Meme Coins: What They Are, Examples, Pros and Cons

Many meme coins are also “scam coins,” which are cryptocurrencies that exist entirely to enrich the creator. Scam coins can take the form of multiple schemes, such as “pump and dump” schemes that call on people to buy a coin in massive numbers. Once the value is sufficiently high, the early owners of the coin will “dump” to make a massive profit. Alternatively, scam coins can be a “rug pull” where developers take all the money and completely abandon a project.

What to Keep in Mind When Buying Meme Coins

So, be careful with those adorable meme coins and watch out for pump-and-dump schemes known as “rug pulls” in the crypto world. Its journey from a pure meme to a solid staple of the crypto market highlights the unpredictable nature of meme coins and their potential for unexpected success. Dogecoin’s rise underscores the importance of community in the crypto market, a factor that can turn a simple joke into a billion-dollar asset. This idea has important implications for understanding market dynamics, where narrative and hype can significantly influence digital asset prices. One social media post from the right influencer can send a meme coin skyrocketing in a hurry — or pop a meme coin’s inflated valuation just as quickly. It doesn’t hurt if your favorite project has a cute mascot, a funny name, or a controversial philosophy.

Meme Coins: What They Are, Examples, Pros and Cons

Some currencies are just an amalgamation of various other memes, such as Dogelon Mars. This coin is a combination of Doge, Elon Musk, and his ambitions to take the human race to Mars in the future. Make sure you’re comfortable with seeing your meme coin values fluctuate wildly — sometimes in the blink of an eye and not always for any obvious reason. Inevitably, barring regulatory crackdowns, the crop of meme tokens looks set to expand, as the tools to make them become ever more accessible. More contentiously, Pump.fun has also served as the launchpad for livestream tokens, with creators taking part in suggestive and even dangerous activities on-camera in order to pump their tokens.

How Do Meme Coins Work?

If you want to delve deeper into the world of cryptocurrencies, our comprehensive articles are the perfect next step. They provide you with well-founded insights into different coins and tokens. Before you buy any coin, you should make sure that you’re buying something legitimate. You prime of prime liquidity provider 5000+ instruments should investigate any potential scams, which meme coins are rife with.

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While many cryptocurrencies like how to buy satoshi Ethereum and Bitcoin tout technical features such as decentralization and anonymity, meme coins are different. Most of these tokens are characterized by a value proposition mostly derived from their association with a meme. There are now hundreds of meme coins all vying for the attention of crypto investors. While many may look legitimate, a majority of meme-inspired cryptocurrencies are simply scam projects designed to capitalize on the growing meme coin trend. You can reduce the risks involved by ensuring that the project is not prone to rug pull scams.

• Surprisingly, the general best practices of meme coin investing aren’t very different from those recommended for alternative investing in general.
• This article originally appeared in Crypto for Advisors, CoinDesk’s weekly newsletter defining crypto, digital assets and the future of finance.
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• When such incidents occur, the investors are left with no means of exchanging a coin that is fast losing its value.
• In the current market cycle, as demand for scalable blockchain solutions grows, SOL’s strong technology foundation makes it a potentially attractive option.
• The project was started to entertain the crypto community and promote creativity within the ecosystem.

While the financial risk of investing in meme coins is high, they’re still an important part of the cryptocurrency market. In fact, the market capitalisation of the top two meme coins, Dogecoin and Shiba Inu, is in the billions. Keeping on top of cryptocurrency trends requires an understanding of how meme coins work and how they’re changing. Solana is a blockchain platform built for speed and scalability, supporting decentralized applications alongside platforms like Ethereum.

While other tokens, such as Cardano’s ADA, promise utility and blockchain tech solutions, meme coins promise a good time. Alternatively, you can refer to the handy list on CoinMarketCap that tracks all meme coins. Do your due diligence before you spend money on a volatile investment like crypto.

Kabosu, the Japanese dog famously known as the subject of the meme, was a Shiba Inu who lived to 18 £27 million lost to bitcoin and other investment scams years old before his death earlier this year. Doge memes could return in 2025 when President-elect Donald Trump takes office after he tapped Musk and entrepreneur Vivek Ramaswamy to lead the Department of Government Efficiency. Musk was one of the coin’s biggest supporters, so much so that in 2023 he even temporarily changed the logo on X, formerly known as Twitter, to the Doge dog logo, triggering a spike in Dogecoin value.

With viral marketing on platforms like TikTok, Bonk aims to be a community-driven cryptocurrency. Shiba Inu (SHIB) was introduced in August 2020, modelled after Dogecoin, and has positioned itself as the “Dogecoin killer”. Shiba Inu has built a large following on social networks and forums, focusing strongly on community development and projects. Shiba Inu, another dog-themed cryptocurrency, is also available on these centralized exchange platforms, however more obscure meme coins can’t be purchased easily this way. Instead, interested investors will have to sign up for newer exchanges or learn how to use decentralized exchange platforms to buy these lesser-known coins.