What are meme tokens?
Meme tokens are tokens with no practical value at the time of their creation, primarily referring to Internet humor, social narratives or events. In a broad sense, such tools act as a tokenized version of the network effect or public attention to a phenomenon.
Dogecoin is considered to be the first meme token. It was created back in 2013 as a joke on the topic of the rapidly growing number of cryptocurrencies.
Since then, many similar projects have appeared. However, the peak of their popularity occurred at the end of 2023 - beginning of 2024. According to Google Trends, peak interest for memecoin was recorded in November 2023.
Google Trends
The Coinmarketcap dashboard by the end of May 2024 includes more than 2,300 Memes tokens with a total market capitalization of over $53 billion. However, the entire market for these tokens includes tens of thousands of units on various networks that are not tracked by monitoring services.
2. Binance analysts note: the economic attractiveness of meme tokens lies primarily in the fact that the vast majority of such assets have a market capitalization equal to their FDV. This indicates that their creators unlock and release all coins into circulation at once, without suggesting further emission and, therefore, dilution of the value of the tokens.
According to Ethereum founder Vitalik Buterin, there are three main reasons why mass users became interested in such assets
their value is rising;
they are open and democratic;
give pleasure.
Buterin also noted that such cryptocurrencies could become a new way of financing for socially significant projects.
3. The meme token market has attracted not only those who want to earn money, but also those who want to spend on social projects.
The same Buterin in 2021 sent over $1 billion in SHIB meme tokens to fight the coronavirus. Since 2014, the Dogecoin community has raised funds to send the Jamaican bobsled team to the Sochi Olympics, launch two water wells in Kenya, and eliminate the consequences of the floods in Kashmir.
This is just a small part of the initiatives that are based on meme tokens. For example, there are charities whose goal is to help pets. The main drivers of token adoption in this space are efficiency, accountability, affordability, benefits, and growth potential.
Celebrities like Elon Musk, who supported Dogecoin in 2021, influencers and crypto funds played a significant role in popularizing the trend. Many users perceive the memes as a response from retail traders as part of the confrontation with Wall Street, which began in 2020 amid the rise in shares of GameStop.
Well-known cryptocurrency supporter and former MMA fighter Andrew Kang of Mechanism Capital saw meme tokens as a qualitatively new asset class. In his opinion, they carry not only a humorous narrative, but also other values, including identity, lifestyle and political views.
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