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Meme coins, shitcoins like the others?

Our opinions

7 min read

You probably know about meme coins, even if you don’t know the definition (yet). Generally, when we talk about meme coins, we’re talking about those tokens that refer to memes. If specifically, you don’t know what “meme coins” are Memes", you say (to summarize) that these are concepts or ideas transmitted by images, gifs or videos. Generally, a "meme" has a strong humorous dimension and it is mainly used on forums or social networks to express an idea in a funny way.

If we talk about "meme coin" in the world of cryptocurrencies, it goes back to the creation in 2013 of the first cryptocurrency of this type, namely dogecoin. The cryptocurrency, originally created following a bet between friends, used the image of the "meme" doge meme, very popular at the time.

Le dogecoin managed to create a community around this cryptocurrency, which was then looking for a kind of cryptocurrency for fun, which had no other purpose.

However, in 2021, the entrepreneur Elon Musk created a buzz among his millions of Twitter followers after tweeting that “dogecoin” was the people’s cryptocurrency. It didn’t take much more for dogecoin’s price to explode and gain wider attention.

Since that event, there have been a multitude of cryptocurrencies that have taken up the concept of the "meme" that have been launched on the market. Some of them have had dazzling success and others have sadly joined the graveyard of useless tokens.

Let's see, here, to what extent we can recognize a shitcoin an meme corner and let's also ask ourselves if they can actually be beneficial to the crypto industry, as some proponents suggest.

What are the particularities of Meme Coins?

A "doge" meme derived from a photo of a shiba inu dog

For a beginner, it can be difficult to do the distinction between the different types of cryptocurrencies. There are differences in the technology used, the way they work, the monetary policy and, above all, the final objective. For example, bitcoin is a cryptocurrency that was created to serve as an exchange currency operating on a decentralized system. The Ethereum cryptocurrency was created to serve as a vector for the creation of decentralized protocols. We could extend the list to countless cases, but let's focus on the memes corners.

The use of meme coins does not go beyond the strict framework of cryptocurrencies and decentralized finance. In other words, real-life use cases are not the priorities of these meme corners. They are intended to be used as tokens in exchange, lending or farming protocols. Concretely, meme coins have no use other than speculation.

In the eyes of the general public, the Shiba Inu And the others memes corner place more value on their community than on their possible practical applications.

This is why in most cases memes have more emphasis on marketing and social media. This is the main place of their expansion. Marketing teams work with influencers who actively practice shillings, or the excessive promotion of tokens by playing on the promise of future gains.

Coin memes survive thanks to their social commitment on the networks. This is a fact specific to many tokens, and it works similarly to certain projects. NFT also…The community is at the heart of the project, it is it which will determine the trust and the price of the token in the future.

So, meme coins have a short lifespan. If their community turns away from the token, then the token loses value. Meme coins only survive for a while, like a fad, they are very quickly overtaken by another meme coin.

If you are interested in the question of social engagement and the value of cryptocurrencies, you can read our article: Is the value of a crypto boosted by social engagement?

Why are meme corners so attractive?

There is no denying the appeal that meme coins have for many investors, whether we deplore it or not. However, there are typical profiles on which there is a stronger appeal:

➡️ Beginners : A person who discovers the world of cryptocurrencies cannot initially sort things out and know how to distinguish the different cryptocurrencies. He is then more likely to invest in the same coin if he hears that this same coin can bring him a return on his investment. This is part of the beginner's mistakes typical. Likewise, a beginner may confuse different concepts and may be put off by complex projects that require concentration and knowledge. Thus, the beginner is more likely to invest in a meme coin because he does not yet have the intellectual background to understand the issues and uses of the token.

➡️ A young audience: Cryptocurrency is an industry accessible to everyone, without restrictions of age, gender or nationality. Thus, teenagers or minors can buy cryptocurrencies relatively easily. Naturally, due to their young age and financial immaturity, they will be more attracted to investing in tokens that have the names of dogs or animals. This is also what explains why many protocols have universes specific to food as well (see Food Tokens) because it attracts more young people. Humor, lightness and simplicity are elements specific to meme corners that target a young audience. If you look at the top 10 memes corners, all of them, without exception, refer to childish themes.

➡️ The "degens" : People who speculate heavily on cryptocurrencies are called degenerates. These are people who are motivated solely by the quick profit and who only seek performance, without seeking to makefundamental analysis on the projects presented. Typically, the of people are investing heavily in memescoin and shitcoins in the same way: hoping to make a quick profit. Indeed, with good dump and dump techniques, meme coins are known to have significant volatility which can make some savvy people win while the majority will lose all their savings.

This is a list of typical meme coin investor profiles, however, there are people who do not fit this type of profile and who are nevertheless interested in meme coins for other reasons.

-Read the article : The Shiba Inu: The token that makes financial degenerates salivate

The subsequent quest for meaning and the search for credibility

The thing about coin memes is to blend in and imitate other projects and cryptocurrencies as much as possible. Thus, meme coins evolve in the best case towards a dynamic ecosystem which on the surface resembles a classic cryptocurrency. Shiba Inu has, for example, established numerous partnerships with DeFi companies and protocols in order to find more use cases for the token.

This is precisely what is sought in the many applications developed which integrate meme coins. They try to find use cases in order to answer the question of usefulness. For example, now the Shiba Inu can be used in some stores for online transactions, or to pay for movie tickets, etc.

All these attempts are certainly encouraging and promising, but the fact remains that the deep sense of Shiba Inu is not yet revealed and it probably never will be.

Can we really create utility ex nihilo? To create a car, it's not enough to just create the body, without thinking about including an engine, right? You will have the appearance of a car but in no way a functional vehicle. So, this is what we can bitterly see with meme coins: they only have the appearance of a cryptocurrency.

Can meme coins benefit the cryptocurrency industry?

This is a legitimate question to ask because many supporters of meme coins claim that there is a beneficial effect for the industry. The beneficial effects would be that it attracts people to the industry and increases the adoption of cryptocurrencies overall.

While some only see " shitcoins » worthless, others believe that a community-run project is a true example of decentralization that will help advance the industry…

This is an argument that can be made, certainly...However, we can retort that this results in a degradation of the crypto industry as a whole. This type of behavior causes investors to lose a lot of money and does not improve the technology itself. That's pretty much the reality. The arrival of new investors of this type in the ecosystem distracts us from the real challenges of decentralized finance.

Noble causes and ethical projects are then completely crushed by projects for teenagers in search of financial freedom.

The industry is increasingly rife with scams and fueling the disappointments of once-enthusiastic investors. Meme corners also lose hard-won credibility within theintelligentsia who only sees a group of apprentice traders who confuse the stock market and the casino.

Finally, coin memes distract from truly humorous cryptocurrencies. Indeed, Dogecoin did not premeditate its success. This is all the difference with the same corners that succeeded it. You don't repeat a joke and it's always less funny when it's repeated...

–> Read thecrazy story of Dogecoin which started as a simple joke.

What is the difference between a meme coin and a shitcoin?

We want to say that there is none.

Quite frankly, there is none or the border is very fine.

Make one more time fundamental analysis and only invest if you are really sure that this project corresponds to your values...Otherwise, you can always buy bitcoin…That makes 14 years that it exists and that its price is on the rise. Even if you have no guarantee that its price will rise over time, you are sure to invest in a cryptocurrency, which at least makes sense…

—> You can read our article on the Shiba Inu : The Shiba Inu: The token that makes degenerates salivate?

Note: This is not investment advice. Always do your own research. All investments involve risks.

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