The Rise of MEME Token: Shifts in Investment Logic and New Market Landscape

The explosion of MEME tokens in 2024 signifies that the investment logic in the market is changing. MEME has become a favored investment category among investment institutions and market funds, gradually becoming a mainstream investment choice.

Internet culture breeds MEME

The origin of MEME can be traced back to the internet era. Most of the currently outstanding MEME projects originate from the popularity of internet social interactions. For example, Doge, SHIB, PEPE, etc., represent the communication and interaction generated by global netizens through the internet, which is also the root of internet culture, referred to as "grassroots culture".

MEMEs are everywhere, and each MEME has a story behind it. These stories spread across the internet globally, bringing a sense of identity to people, which is a key reason for the popularity of MEMEs. MEMEs sprout and continuously spread through social platforms, chat applications, forums, and other channels. Social media sites are the main battleground for the popularity of MEMEs and an important avenue for people to express opinions and vent emotions, contrasting sharply with the mainstream, rigid online information.

MEME expresses people's thoughts in specific scenarios in a concise way (short texts, innovative words, images, memes, etc.). Its widespread dissemination encourages even those who do not understand MEME to learn about and integrate into it, spreading like a virus. A sense of belonging is the core value of MEME and the main driving force behind the rise in MEME's price.

The Combination of MEME and Blockchain: Redemption in Market Chaos

Blockchain technology has given value to many intangible things, and MEME is no exception. Strictly speaking, the early BTC can also be considered a kind of MEME. After the popularity of BTC, a large number of worthless altcoins emerged, causing chaos in the market, and DOGE was born to satirize this phenomenon. The first wave of DOGE's popularity occurred after the market in 2013, and it can be seen as the MEME 1.0 era.

The proliferation of altcoins during the bull market in 2017 and the subsequent chaos in the market (ICO disorder) laid the foundation for the second rise of DOGE, which is also an important factor for DOGE's renewed recognition in the market in 2021. Even without the endorsement of famous individuals, there may still be other public figures supporting MEME. Dog-themed MEME projects like SHIB have also begun to emerge, marking the entry of MEME into the 2.0 era.

In this round of price increase in 2024, the market chaos has transformed into the overvaluation of VC coins and many "value" projects engaging in PUA towards users, with MEME rising again. The stagnation of the mainstream market reflects, to some extent, the resistance of underlying investors against VC coins and the chaos of harvesting leeks, while the fair distribution and price performance of MEME perfectly address the pain points of many, naturally garnering significant attention, as MEME enters the 3.0 era.

From the development history of MEME, it can be seen that an important reason for the popularity of MEME is the inaction and misaction of the mainstream market. As retail investors at the bottom lack sufficient strength and funds to resist this behavior, they can only turn in the opposite direction. What retail investors lack the least is enthusiasm and the ability to spread, which is also where its value lies, and is a basic factor in our choice of MEME.

Characteristics of Potential MEME

Not all MEME have investment value. Similar to the chaos of mainstream coins, there are also mixed situations in the MEME track, where the behavior of harvesting韭菜 exists everywhere, and this phenomenon may become more pronounced in the future. For ordinary investors, it is crucial to identify potential MEME projects. We can summarize some characteristics by analyzing past successful MEME projects.

DOGE

DOGE is obtained through mining, with a large initial supply and low price, making it suitable for online tipping and supporting multiple social platforms. It has also sponsored some sports events, aligning with the tipping culture abroad. Later, the community slogan "To The Moon" became widely spread, and various MEME images circulated on social media.

SHIB

SHIB, themed around the Shiba Inu, is another extension of Dogecoin. It adopts a fair distribution method and has a large entertainment attribute. It continues to build on its development direction, aiming to become a "value coin" by launching DEX and tokens such as BONE, and it plans to launch its mainnet in 2023 to support the operation of its token economy, becoming an exploration of the transition of MEME into a value coin.

PEPE

PEPE is a cryptocurrency primarily based on the popular internet meme of the cartoon frog Pepe the Frog. In addition to comics, Pepe has expression packs, animations, and a strong user base, making it widely used across major social platforms. The PEPE Token, aside from most of it being used for liquidity pools, also introduces a deflationary mechanism and a redistribution mechanism, attracting the attention of many investors as well as support from market makers and investment companies.

WIF

WIF is a dog-themed MEME Token on the Solana chain, and it is currently the third most successful dog-themed Token in terms of performance. WIF features low cost and fast transfer speed, with the creator's balance set to 0 to ensure the decentralization of the Token. It is endorsed by well-known personalities, standing out among many dog coins. WIF has relatively stronger speculative properties, and the price surge has further increased investor attention.

PUFF

PUFF (PUFF The Dragon) is a MEME project primarily aimed at the mETH (Ethereum re-staking Token) community on the Mantle chain, themed around a dragon in black and gold. PUFF has redefined meme narratives, allowing users to obtain PUFF by using mETH to mint a mysterious potion, after which they can establish AMM pools for free exchange. The actions of well-known traders making large purchases have made PUFF a focal point of attention.

Common Features of Popular MEMEs

From DOGE to PUFF, we can see that the distribution of MEME and its low entry barrier are one of the main factors for success. From hash power mining to fair distribution, allowing community users to participate at a low cost has reserved opportunities for new users to join and has accumulated a large user base, which is also the backbone of MEME's spread.

Additionally, the MEME project has gradually shifted from early internet cultural uses to more value-oriented aspects, such as SHIB's Swap, PEPE's deflation, WIF's low cost and decentralization, and PUFF's value representation centered around mETH. This indicates that pure price speculation does not necessarily lead to the success of popular MEME Tokens; there also needs to be certain application scenarios, and investors still have certain expectations.

Furthermore, behind every MEME there are endorsements and financial support from celebrities, KOLs, or public figures. The celebrity effect has played a crucial role in the success of MEME projects.

Of course, price is also a key factor in the success of the MEME Token. The rise in price has allowed many retail investors to profit, and the increase in the retail base has further enhanced the influence of the MEME Token, thereby attracting the layout of institutions and exchanges.

The development path of MEME is exactly the opposite of that of high-financing VC coins. Allowing institutions to take over from retail investors is an important sign of MEME's success. In contrast, VC coins focus on the profits of the project team and investment institutions, ultimately ending with retail investors taking over. After retail investors complete the takeover, no funds come in, thus serving as the final baton. It is precisely for this reason that we see the current coldness of VC and the surge of MEME.

MEME Coin Development Goals

No high market cap MEME coin has gained attention solely through pure speculation. For investors, the economic model and application scenarios are factors that must be considered for long-term development.

For example, the rewards of DOGE and POW, and the Swap developed by the SHIB team. Since this year, this trend has been further strengthened. Projects like PUFF have further increased the application scenarios and the economic cycle of the token, with a trend towards being closer to ordinary "value coins" in their development direction, where the MEME attribute becomes the main distinguishing factor.

The mETH incentives from PUFF have attracted a significant amount of funds, successfully making it a leading DeFi project within the Mantle ecosystem, greatly promoting the development of the Mantle ecosystem. In addition, PUFF has incorporated GameFi elements into its project planning, with staking and gameplay also becoming important factors in attracting large investors and institutions. This indicates that the MEME project team has begun to focus on the long-term development of the project, rather than just temporary price pumps and mindless speculation.

If investment goes to extremes, it will inevitably backfire. The development path of PUFF tells us that MEME, as an early promotional tool, can quickly attract crowds and funds, but to achieve long-term development, empowerment and planning are unavoidable factors. Moreover, it is also easier for some technically analytical investors to accept. Similar projects, such as the surge of AIDoge, have brought huge traffic and trading data to Arbitrum.

Summary

From the development paths of the five MEME Tokens mentioned above, MEME has gained recognition from numerous investors. Leveraging absurd humor and internet culture as a user base makes it easier to evoke a sense of identification among users. This is a low-cost and rapid way to enter the user market and establish project communities, and it is expected to become a major grassroots project's cold start strategy in the future.

However, projects that rely solely on the MEME concept often struggle to sustain development. Therefore, mid-term technological follow-up is crucial for attracting the attention of institutional investors and exchanges, the "regular army." In this process, chips may gradually shift from retail investors to institutions, thereby promoting the transformation and growth of the project. After gaining profits, retail investors usually develop a greater sense of identity with MEME culture, thereby creating a positive flywheel effect that helps MEME gain more popularity.