Written by Max Parasol
Compiled by: Tom, Mars Finance
Memecoins are not useless: they bypass securities laws, don’t profit venture capitalists, and are also extremely fun.
Memes are the essence of cryptocurrency: social trends, sarcastic humor, and the lure of absurd profits, all wrapped up in a nonfunctional token. They’re not for Warren Buffett, but they are for legions of regular people looking for fun, community, and a break from their fringe environments.
"Memes are leading indicators," said Danny Yang, founder of OnChainMonkey, referring to the wild returns relative to other indicators. Memecoins gamify the investment process, with investors flocking to follow invisible trends from election results or jumping on the latest coin launch within ten minutes of the arrest of the UnitedHealthcare CEO shooting suspect. It's very 4Chan-style.
Building community, social bonding, and having fun are all part of the appeal of memecoins. “Humans are social creatures, and memes are about people finding entertainment in the same things,” Yang said.
The meme itself is irrelevant. It's a social game that requires a large number of players, and the meme is judged by how many people might want to participate in the game.
But beyond silly fun and the opportunity to make money, what are the real use cases for useless memecoins?
PNUT was suppressed, but became stronger as a meme coin. (Elon Musk, X)
Use Case 1: Bypassing US Securities Laws
First, let’s be clear — the uselessness of memecoins is a special use case in itself. They get around the US securities regulations that have suppressed the ICO craze. Furthermore, memecoins specifically would not be covered by ASIC’s proposed expanded crypto powers. Why is that? Because they do nothing.
“In reality, it’s safer today to launch a memecoin with no use case than to launch a useful token,” wrote Chris Dixon, managing partner at a16z Crypto.
US securities law focuses on the Howey Test to determine what constitutes an investment contract. Memecoins represent only a concept and do not promise any return from the efforts of others, so they are not subject to this test. This regulatory friendliness has allowed memecoins to spread like wildfire during the crypto war era (2022–2024).
Memecoins were the biggest crypto narrative in 2024, accounting for 14.3% of CoinGecko’s Q2 market share. Now, with Donald Trump as the incoming president and new SEC head Paul Atkins expected to potentially allow “real” projects to raise capital again through something like Hester Peirce’s 2020 “safe harbor” proposal, will they fade away?
Use Case 2: Political Speculation
In a world where people use technology to create social bonds that they have personally experienced in the past, memecoins allow holders to participate and capture the political zeitgeist. Memecoins have been created to support and oppose candidates in the U.S. presidential election.
Memecoins are for everyone, even Gary Gensler. (X)
Argentina’s liberal president, Javier Milei, also has a memecoin dedicated to his reforms. The social utility of allowing people to express their political views in a monetary manner can be seen as a parallel to the literal donation efforts run by major campaigns.
However, social engagement or utility should be better understood as capturing the “spirit of the times,” argues Daniel Drescher, VP of business development at Sal’Ad Labs, who cites Trump’s new friend and future head of the Department of Government Efficiency (DOGE), Elon Musk, as a prime example in an interview with (Magazine).
“How did Dogecoin become the gold standard in this uncertain Web3 space? They have perhaps the most powerful influencer or key opinion leader of all time — the richest and undefeated man in the world, Elon Musk. He is the inspiration for Iron Man. For Ayn Rand enthusiasts, he is the godlike John Galt who created an engine powerful enough to light up the world.”
Drescher prefers to think of memecoins as “brand coins.” Typically, they require a key opinion leader or a cult figure to drive the coin. Successful memecoins have “a cult following that they live and die for. It’s what gets them out of bed every morning.”
Analogies to the zeitgeist resonate. For example, memes of Kamala Harris proliferated when then-presidential candidate Joe Biden tripped on the stairs and was subsequently removed by the Democratic Party as its nominee.
Political meme coins are popular. (CoinMarketCap)
Use Case 3: Charity Trojan Horse
Memecoins can serve as a Trojan Horse for financing more meaningful projects, such as raising money for charity, launching a casino like Iggy Azalea’s Motherland, or launching an exchange like ShibaSwap.
As Ethereum founder Vitalik Buterin — a man known for donating memecoins to charity — wrote:
“The more interesting coins I’ve seen are those where a large portion of the token supply (or some ongoing fee mechanism) is dedicated to some kind of charity.”
“It felt like there was an untapped opportunity here to try to create something more positive and lasting.”
The Neiro Foundation’s memecoin NEIRO is attempting to become the next Dogecoin by fusing utility with speculative upside.
The question is, who is the Trojan Horse? Is it charitable or speculative?
The memecoin is named after Neiro, a rescued Shiba Inu adopted by Atsuko Sato, the owner of the original "Doge" Kabosu.
Doge vs. Neiro. (X)
The Neiro Foundation is a collective effort to fund the rescue and welfare of Shiba Inu dogs worldwide, providing essential resources and financial support to dog shelters and charities that improve the lives of Shiba Inu dogs. This breed is prone to several common health problems, including hip dysplasia, eye diseases such as glaucoma and cataracts, and progressive retinal atrophy.
SlumDOGE Millionaire, who gained public recognition after converting $180,000 into over 3 million DOGE, a process documented in the documentary (This Not Financial Advice), is now a spokesperson for the coin and said: “While the growing popularity of memecoins has attracted a lot of skepticism, many critics overlook that some memecoins have clear, positive missions.”
Beyond viral humor, certain memecoins support charitable initiatives and therefore gain fervent community support. The best memecoins have a strong narrative foundation that resonates with the growing number of socially conscious Web3 users, while demonstrating the huge potential of DeFi to drive philanthropy.
Use Case 4: Funding the Startup of an AI Agent
AI agents have great potential for utility. Imagine an AI agent that automatically rebalances your crypto portfolio so that profits are automatically transferred to quality coins like Bitcoin, Ethereum, and SOL, saving you from holding 90% of the shit coins.
Sometimes it's hard to tell the difference between a robot and a human. (X)
It seems likely that one day AI agents will actually lead autonomous DAOs. But currently, they are highly concentrated at the endpoints of memecoin bot transactions. Bots like Truth Terminal interact with users on Platform X, creating artificial hype to drive community participation and purchases of memecoins.
Look at Fartcoin, the AI-inspired memecoin that soared to a $900 million market cap via the immutable comedy law of “hot air rises.” It’s quickly catching up to GOAT, another memecoin popularized by Truth Terminal.
The whole concept of autonomous AI agents launching a memecoin is a meme in itself, as many of the “AI agents” are just humans in disguise and the GOAT is made by humans. However, the growth in the number of real agents highlights its potential.
Masa co-founder Calanthia Mei said there’s a “huge difference between a smart AI agent memecoin and a dumb memecoin.” Mei, who was previously a founding member of PayPal’s venture arm, talked about the “sentience of memecoins” — referring to the intersection of AI and memecoins, where AI agents perform tasks, such as conducting transactions.
“Besides making money, a side effect of memecoins is that they make technology cool. They shine a spotlight on technology that only a small group of people care about.”
Memecoin is helping to fund and launch agents on Virtuals Protocol, where AI agents can be programmed to interact with token economic designs. It also allows for code-free AI agent building, tokenization and deployment, as well as more complex designs.
Mei’s company, Masa, is a “decentralized network of data miners” that provides real-time data to support context-aware AI agents that leverage retrieval-augmented generation (RAG) and rely on “emotional intelligence” based on pre-planned prompts. These agents can learn new things and acquire new memories in real time, she told (Magazine).
Hence, in this context, these RAG-based AI agents are equipped with dynamic data retrieval, emotional intelligence, and memory capabilities, making them context-aware and adaptive in real-time.
Mei believes AI agents are an unstoppable use case for trading
Mei is convinced that memes will accelerate experimental connections between AI and crypto. Since the GOAT story appeared, she has received “three times as many inquiries for AI agent development in the past few weeks as before.”
Think about it — creating memecoins of smart AI agents that roam Crypto Twitter, the home for crypto market sentiment. It’s an almost unstoppable investment thesis.
Use case 5: Fair launch of tokens to prevent retail investors from being scammed by venture capitalists
For years, retail crypto investors have been ripped off by venture capitalists. These investors get in early and snap up large amounts of token supply at prices far below the final market price. This leads to absurdly high fully diluted valuations, and retail investors lose out when venture capitalists dump their tokens. No wonder users burned by unfair token economics turn to memecoins, which can — though often don’t — launch fairly.
“For some projects, memecoins provide much-needed funding to develop their technology, escaping the cold VC market and Web3 echo chamber,” said Mei of Masa.
In Murad Mahmudov’s viral Supercycle talk at Token2049, he argued that fully unlocked memecoins mean that tokenized memes are actual products. There are no venture capitalists and no lock-up periods. Since you can’t price the asset because it has no income, this becomes an advantage.
Ultimately, memecoins could be useful for a new type of financing tool, said Zhen Yu Yong, CEO of Web3Auth, a white-label wallet company that builds wallets for Trust Wallet, numerous Fortune 500 companies and has 20 million monthly users.
Of course, most memecoins will fail. But now you can launch a tokenized project without market makers and have a chance to succeed, without the interference of venture capitalists and back-end equity trading.
This lack of venture capitalists backing most memecoins is clearly part of the retail appeal. Veterans who missed out on Bitcoin in 2010, or Ethereum, or any other major coin, can get rich instantly without venture capitalists screwing up in the pre-seed round. It’s an ideological investment thesis — the veteran’s dream.
In summary, memecoins are like cartoon versions of ICOs without the preconceptions of what someone might be trying to build and launch.
The most accurate meme of the ICO era. (LinkedIn)
