What is Meme Coin? All About Joke But True Cryptocurrencies

Meme coins, the most popular cryptocurrency category of recent years, enable new investors to join the cryptocurrency market. Crypto investors are curious about the question of what is a meme coin and are doing research to make investments in this field. In this guide, you will learn what meme coins are and learn about the most popular meme coins. You will also find the answer to the question of how to invest in meme coins in this guide.

Introduction The Rise of Meme Coins

Meme coins are a fun and specific building block of the cryptocurrency market. Unlike other cryptocurrencies, meme coins do not offer any projects or technological innovations. Meme coins build a community and seek to gain value through that community. Crypto investors gravitate towards meme coins for the sake of being part of a large community rather than for financial returns. This has evolved into a different situation with the growing number of Solana meme coins. Meme coins are now preferred for financial returns.

The rise of meme coins started with Dogecoin. Dogecoin, which became popular in the crypto world after Elon Musk, CEO of Tesla and SpaceX, said “Doge to the moon!”, revealed the fun side of cryptocurrencies. Elon Musk’s influence on meme coins is quite high. Musk can generate hundreds of millions of dollars of trading volume with a single statement.

What is Meme Coin?

Meme coins are often created from internet jokes, pop culture products, animals or pranks. Peanut the Squirrel (PNUT), for example, gained popularity for being the first squirrel to be euthanized in the US and became a meme coin after Elon Musk’s remarks.

The meme coin represents a specific figure and builds community around that figure. It does not offer technological innovation like Sui, a Tier-1 project, but is driven by a vision of a loyal community.

Differences with Traditional Cryptocurrencies

The biggest difference between meme coins and traditional cryptocurrencies is entertainment and community support. Meme coins are internet jokes and pop culture products. The crypto community can make its meme coins go viral.

Other differences are speculative value and higher risk.Meme coins, unlike traditional cryptocurrencies, are volatile.Meme coins can lose value if they lose community support or if the adopted meme falls behind. Limited technology is also one of the biggest differences. Speculative investments in the cryptocurrency market should be conducted with risk management.

The Role of Community Power in Meme Coins

Cryptocurrencies grow and thrive on community. Building a community is the best way to convince new investors. Crypto projects that build trust and loyalty will attract more investors and thrive.

One of the crypto categories where the community is most active is meme coins. Meme coins use the community as a marketing and advertising method. The community is the best way to communicate what a meme coin aims to do and what it focuses on. The future of meme coins also depends on the community.

Emergence and History of Meme Coins

Meme coins emerged as a joke as a reaction to the serious nature of cryptocurrencies. Meme coins, which marked the beginning of a new era with their interesting and fun structure, enabled millions of investors to approach cryptocurrencies positively.

Meme coins started with Dogecoin. The first meme coin, Dogecoin, was created in 2013 by software engineers Billy Markus and Jackson Palmer. For a long time, Dogecoin was the only meme coin in the crypto market, and Shiba Inu, which was launched as a competitor to Dogecoin, helped to popularize meme coins. While the differences between Dogecoin and Shiba Inu were debated, the way was paved for other cryptocurrencies.

Dogecoin First Meme Coin

Dogecoin was created in 2013 by software engineers Billy Markus and Jackson Palmer as a joke. Although Dogecoin is a Proof of Work (PoW) blockchain like Bitcoin, it was created solely as a fun investment tool. Dogecoin came to the forefront with its community support and social media influence.

Dogecoin, the first cryptocurrency of the meme coin category, managed to attract the attention of billionaire name Elon Musk. Musk praised Dogecoin in the programs he participated in and stated that he invested in it. These statements made Dogecoin no longer a joke and made it an official investment tool.

Dogecoin, which has a limited supply, attracts attention with its high transaction speed and low fees as it has a layer-1 blockchain. The answer to the question “What is a meme coin?” is related to the emergence of Dogecoin.

Shiba Inu and Other Popular Meme Coins

Shiba Inu was launched in 2020 by Ryoshi, an anonymous developer. Entering the cryptocurrency market as a competitor to Dogecoin, Shiba Inu managed to build a large community in a short time. Ryoshi sent half of the SHIB supply to Vitalik Buterin. Buterin’s burning of the supply from the SHIB team caused a big echo. This brought SHIB to the forefront.

SHIB paved the way for alternative meme coins. Floki Inu, inspired by the figure of a dog in a Viking hat, became the third largest meme coin after Shiba Inu and Dogecoin. Floki, which grew on social media, has recently lost traction and dropped from third place. PEPE, launched in 2024 and inspired by the Pepe the Frog figure, took Floki’s throne and became the third largest memecoin.

In 2024, a new era began when Solana was favored by memecoin developers. Creating memecoins, especially through Pumpfun, was made quite simple and dozens of memecoins started to be released per second.

Elon Musk and the Impact on Meme Coins

Elon Musk is one of the most prominent figures in the popularization of meme coins. Being rich and interested in cryptocurrencies through meme coins, he has had a huge impact. Musk has caused significant fluctuations in the cryptocurrency market. The billionaire was especially instrumental in Dogecoin reaching a market capitalization of billions of dollars.

Saying that “Dogecoin is the people’s cryptocurrency”, Musk often mentioned Dogecoin in talk shows and live broadcasts. During the 2020 to 2021 period, Musk actively supported Dogecoin and became one of the architects of a new era.

Musk’s impact on other meme coins was also realized through Dogecoin. Known as a figure that raised the price of Dogecoin, Musk started to create memecoins from every discourse. Especially PNUT coin is among the last examples of the period. The most popular memecoins gained fame by following Musk’s lead.

How Meme Coins Work

The working logic of meme coins is mostly based on speculation. Originating from an internet culture or social media post, meme coins run persuasive advertising campaigns to gain value. Social media platforms are the ideal speculation tool for meme coins.

Social media accounts with high followings, so-called influencers, are at the forefront of speculation. These popular accounts make persuasive posts about the meme coin.

Meme coins, launched at a certain price, start to build a community following speculation. Speculative investments have become widespread in the cryptocurrency market. Therefore, the community is of great importance. The community follows the meme coin’s tokenomics and invests according to its circulating supply.

Meme coins are usually built on blockchains like Ethereum and Solana. Meme coins, which are very close to the Ponzi system, cannot move forward without new investors.

Structure of Meme Coins on Blockchain

The answer to how meme coin projects work lies in blockchains. The token standard is the basic building block of meme coins. If a meme coin is launched on the Ethereum network, it adopts the ERC-20 token standard. On the other hand, meme coins released on the BNB Chain have a token standard of BEP-20.

Created with smart contracts, meme coins, just like other cryptocurrencies, are made up of codes. These codes are used to determine the meme coin’s structure and token supply.

Meme coins have a higher total supply than other cryptocurrencies. The total supply is planned to make speculation easier. Meme coins with a higher supply can be launched at a lower price. This way, investors will think that the price of the meme coin is low.

Other details of the structure of meme coins are their security, reliability and use cases. Meme coins can be transferred in a similar way to layer-1 cryptocurrencies such as Aptos and Sui.

Decentralized Exchanges (DEX) and Meme Coins

Meme coins are launched in a different way than project-driven technological cryptocurrencies. Many cryptocurrencies, such as Solana and Aptos, start with pre-sales and are listed on centralized exchanges. Meme coins, on the other hand, are launched on decentralized exchanges where any investor can participate. PancakeSwap, Uniswap and Raydium are meme coin factories.

Meme coins prefer decentralized exchanges due to less bureaucratic hurdles and the principle of confidentiality. In addition, decentralized exchanges, which operate based on a liquidity system, are platforms where anyone can issue cryptocurrencies, unlike centralized exchanges. It is easier to list new coins on decentralized exchanges where speculation is common.

Tokenomic Structures: Supply and Liquidity Properties

Another answer to the question “What are meme coins?” is tokenomics. Meme coins have low liquidity and high supply. Thus, meme coins have a more volatile price structure and a riskier tokenomics.

The supply structure consists of three stages, respectively: aggregate supply, circulating supply and inflation.

The supply of a meme coin is backed by assets in liquidity and a price is set for the meme coin. Investor confidence, market manipulation and market makers shape the tokenomics of meme coins.

Popular Meme Coins and Features

Although popular meme coins have similar characteristics, there are some differences. While the differences between Dogecoin and Shiba Inu stand out, these differences have paved the way for new meme coins.

Dogecoin is a meme coin with a layer-1 blockchain, while Shiba Inu is a meme coin that has managed to build its own layer-2 blockchain. Another notable difference is the community. While Dogecoin is closer to traditional cryptocurrencies, Shiba Inu is completely community-owned.

Dogecoin (DOGE)

Dogecoin (DOGE) is the most popular and largest meme coin. With a market capitalization of billions of dollars, DOGE is inspired by the Japanese Shiba Inu dog. The majority of dog-themed meme coins mimic Dogecoin.

Dogecoin was launched by Billy Markus and Jackson Palmer. Launched in December 2013, memecoin brought the question of what is a meme coin to the agenda. DOGE, the leader among the most popular meme coins, attracts attention with its limited supply and layer-1 blockchain.

Shiba Inu (SHIB)

Shiba Inu (SHIB), a dog-themed meme coin similar to Dogecoin, was launched with the slogan “Dogecoin killer”. Inspired by Japan’s famous dog Shiba Inu, SHIB was launched in August 2020 by an anonymous developer using the pseudonym Ryoshi.

Shiba Inu’s initial goal was to mimic Dogecoin and become the best meme coin by being community-driven. Vitalik Buterin lit the fuse by burning the SHIB tokens sent to him, and the SHIB frenzy began. It was also noteworthy that Buterin sent a certain amount of SHIB to a foundation for donation.

Shiba Inu breathed new life into meme coin culture with a DeFi platform called ShibaSwap.

Floki Inu (FLOKI)

Floki Inu is a meme coin dedicated to Elon Musk’s dog Floki. Although its developers are anonymous, they managed to gain trust in a short time with the community they created.

FLOKI, which was released in June 2021, has been on the rise after Musk’s tweets. Musk shared a Shiba Inu dog with a name tag that read “Floki”. This post, formerly shared on Twitter, started a new era in FLOKI coin.

Floki Inu later partnered with sports organizations and developed an RWA platform called TokenFi.

Pepe Coin (PEPE)

Pepe Coin is a revolution against dog-themed meme coins. Until the launch of Pepe Coin, almost all meme coins were dog-themed. PEPE is a meme coin inspired by Matt Furie’s popular cartoon “Pepe the Frog”.

PEPE was launched in April 2023 and quickly gained a lot of attention. Unlike dog meme coins such as Dogecoin, Shiba Inu and Floki, PEPE, which features a green frog, has managed to get on the radar of whales. PEPE, which has received millions of dollars of investment, has become one of the best meme coins.

Bonk Coin (BONK)

Bonk Coin (BONK) is different from other meme coins. BONK is the first popular dog meme coin on the Solana blockchain. Launched at a time when Solana was under immense pressure and the SOL price dropped to $9, BONK was used by the Solana community as a means of revitalizing the ecosystem. Many Solana whales made efforts to raise the price of BONK. BONK managed to break the pressure on Solana with increasing trading volume and market capitalization.

Released in late December 2022, BONK adopted the figure of a köepk holding a baseball bat and attracted millions of investors.

Advantages and Disadvantages of Meme Coins

Meme coins have many advantages and disadvantages. The biggest advantage of meme coins is that they create a community and a loyal investor base. On the other hand, the biggest disadvantage is the uncertainty about the future of meme coins. Meme coins are the cryptocurrency category that will be most affected by regulations.

Due to their community-driven nature, meme coins are fast to adopt, low cost and easy to list. Crypto exchanges like Binance and Gate.io can list meme coins with high trading volumes.

Other advantages of meme coins are that they are easy to use, accessible to audiences of all ages and fun.

The disadvantages of meme coins are high volatility and reliability. By their very nature, meme coins have extreme price volatility. A meme coin can change in value by 20 to 100 percent. In addition, the vast majority of meme coins are launched for fraudulent purposes.

Low Price and High Potential Investments

Many of the low-priced and high-potential investments in the cryptocurrency market involve meme coins. By their very nature, meme coins can rise quickly because they are launched with low liquidity. On the other hand, this lack of liquidity also brings the possibility of a rapid decline.

Another reason why meme coins have high potential is that they belong to internet culture. A meme coin can rise sharply when any animal or character it draws inspiration from or uses as a figurehead goes viral.

Meme coins attract more investors due to their low price. Meme coin investors looking for an early entry opportunity will gravitate towards cryptocurrencies they see as having potential. This helps meme coins gain traction across the board.

Community Support and Rapid Adoption

Cryptocurrencies cannot progress without community support. This is because new investors follow the thoughts of the cryptocurrency’s investors to get ideas. In other words, a person wants to know what existing investors think about the cryptocurrency they are going to invest in. Meme coins in particular owe their success largely to community support.

The community ensures rapid adoption and makes it easier to convince new investors. Investors involved in the development process can provide feedback and contribute to the meme coin’s progress. Increasing funding and liquidity day by day is also directly related to community support.

Speculative Structure and Excessive Volatility

Meme coins have high volatility due to low liquidity. When an investor sells 1 million dollars, the related meme coin can drop significantly. Therefore, meme coins have a speculative nature. Wallets with large investments speculate on the meme coin they invest in and buy low and sell high.

Crypto investors should be wary of excessive volatility and manage risk when investing in meme coins. This speculative nature is how meme coin projects work. Whether positive or negative, the price can change with all kinds of speculation.

What to Consider When Investing in Meme Coin

Crypto traders often learn about meme coins from social media platforms. A social media user speculates about the meme coin they are investing in. Investors who are exposed to this speculation turn to meme coins in search of high returns. Investors are advised to be wary of speculation and do their research.

When investing in a meme coin, it is important to consider whether the meme coin will become obsolete. Meme coins created on a tweet or meme coins created on an action are usually short-lived.

One should also be wary of the extreme price volatility of a meme coin. If a meme coin moves between 20 and 50 percent on a minute chart, it is most likely due to a lack of liquidity. Meme coins with low liquidity can create a panic environment and pave the way for selling at a loss.

You should also be wary of the Pump & Dump model. Crypto users with high followings who can reach the masses may pump (rise) and then dump (fall) a meme coin they have identified.

Pump & Dump Risks

The Pump & Dump scheme has become widespread in the cryptocurrency market. Especially meme coins, with their low liquidity, can easily fall prey to Pump & Dump manipulation. Therefore, traders are advised to manage risk and proceed with caution against these schemes. An investor who invests during the Pump can make serious losses during the Dump.

What to Consider When Choosing Meme Coin?

Before investing in a meme coin, the social media accounts of the relevant meme coin should be examined, and projects with bot interaction or projects with constant “It will rise more” comments should be avoided. These meme coins may have a Pump & Dump scheme.

On the other hand, it is important that the liquidity of the meme coin is sufficient and the daily trading volume is high. Otherwise, rug pull (fraud & ponzi) may occur in meme coins.

If the meme coin to be invested in has influencer support, that meme coin may soon be on the rise. High volatility can be seen in a meme coin where speculation has started. Therefore, it may be risky to invest from the top in meme coins supported by the masses.

Finally, it may also be useful to examine the project team of the relevant meme coin.

Long Term or Short Term Investment?

The most popular meme coins can be considered long-term investments, but many newly launched meme coins are disappearing. This is because investor perception of new meme coins is based on making easy money.

High liquidity, a strong community, listing on centralized exchanges and high market capitalization can be useful in identifying long-term meme coins. On the other hand, meme coins that are launched based on a fad or trend can be traded short-term.

How to Buy Meme Coins?

Meme coins can be purchased in various ways. Recently, the most preferred method is to use decentralized exchanges. Since decentralized exchanges are the first platform where meme coins are launched, they can offer low prices. Another method is to buy from centralized exchanges. However, when meme coins are listed on centralized exchanges, they may have already risen.

Binance, KuCoin, Uniswap, Raydium, Jupiter, PancakeSwap and SushiSwap are the most popular decentralized exchanges.

Buying meme coins on decentralized exchanges requires a crypto wallet of the relevant blockchain. These wallets also allow you to trade other cryptocurrencies, such as the NFT and metaverse meme coin projects.

Trading on Centralized (CEX) and Decentralized (DEX) Exchanges

On centralized exchanges, trading is conducted via a market order or a limit order. An investor can set the price at which to buy and sell a meme coin. Purchased meme coins are held in a crypto wallet controlled by the centralized exchange and transmitted to the user.

In decentralized exchanges, on the other hand, trades are predominantly executed through market orders. A buy order to liquidity is met with a sell order from liquidity, resulting in a successful trade. The crypto trader holds the meme coin received from the decentralized exchange in their personal crypto wallet.

Using Binance, KuCoin, Uniswap and PancakeSwap

To use centralized exchanges like Binance and KuCoin, you need to create a membership and authenticate yourself. Centralized exchanges accept users according to their own rules.

There are no requirements to use decentralized exchanges such as Uniswap and PancakeSwap. Traders can trade with crypto wallets that support the respective platforms.

Choosing a Crypto Wallet for Secure Custody

If a purchased meme coin is to be held for the long term, it should be stored in personal wallets. This is because the words of the personal wallet are in the hands of the investor and no one else can access the wallet. On the other hand, meme coins purchased for short-term or trading purposes can be held on centralized exchanges.

Cold wallets are recommended for security. These wallets are Ledger-style disks with a physical structure. Since cold wallets are not easily accessible today, mobile app wallets such as Trust Wallet and Metamask are preferred.

How to Make Money with Meme Coins

Meme coins are inherently high in speculation and volatility, so they offer a variety of monetization potential. However, meme coins also carry the risk of losing money for these reasons.

There are several ways to make money with meme coins. The first is short-term speculation. Traders can take advantage of the momentary trend of the relevant meme coin and turn the price rise into an opportunity.

Another method is the Pump & Dump strategy. Buying can be done after celebrities such as Elon Musk share posts about the meme coin, and profit sales can be realized when there is enough uptrend.

The majority of meme coin investors adopt a long-term investment strategy. Investors who buy at the right place are waiting for the related meme coin to rise.

Airdrop and reward programs can also be a strategy for making money with meme coins. Many meme coins offer airdrops to users who meet certain requirements before they are released.

Day Trading and Short Term Trading

Towards the end of 2024, meme coins were predominantly day traded and short-term trading strategies. This was due to the increasing number of meme coins launched on the Solana blockchain. In day trading and short-term trading strategies, news flow is important. You can follow the influencer posts and news flow about the relevant meme coin, and if there is a bullish expectation, you can day trade. Short-term trading can hold for a few days. This method is usually used during periods when the meme coin will make an announcement or announce a partnership.

Staking and Passive Income Models

Meme coins can be staked just like other cryptocurrencies and earn passive income. For this, you can check the staking programs of centralized exchanges or the staking pages of decentralized wallets. It is also possible to earn passive income from meme coins with liquidity staking on decentralized exchanges.

Early Stage Investments and Presale Strategies

Although this method is not used very often, it is an effective one. Since meme coins have a fair launch process, they do not carry out a presale or early-stage investment. The meme coin is launched on a decentralized exchange and offered to investors. However, there are rare cases of meme coins being launched through presales. At this point, the social media platforms and websites of the relevant meme coins can be followed.

The Future of Meme Coins

As long as the cryptocurrency market exists, meme coins will be a part of it. With easy launch options and effective investor strategies, meme coins are at the forefront of the market, and could host large inflows of money in the future.

In order for meme coins to gain value in the future, some of the popular meme coins may need to make significant gains or a meme coin bull may start. Since meme coins are currently driven by speculation, a long-term planning strategy is not recommended.

Metaverse and NFT Integration

The metaverse, one of the most important trends of 2021, and the NFT category, which is still a popular area, will come to the fore in the coming period. Meme coins are expected to gain a foothold in both of these categories. In particular, meme coins’ mascot NFTs and community interactions with the metaverse may increase.

Artificial Intelligence Powered Meme Coins

The most popular category of meme coins recently is the field of artificial intelligence. Artificial intelligence chatbots or AI Agents (artificial intelligence assistants) created through X are gaining a place in the cryptocurrency market as meme coins. The developing structure of artificial intelligence and the openness of meme coins to speculation may make this trend more effective in the future.

Impact of Regulations

The impact of regulations on the cryptocurrency market is increasing day by day. Meme coins, which are speculative in nature, are the cryptocurrencies that will be most affected by these regulations. For this reason, many meme coins may be banned or the volatile nature of the meme coin market may disappear.

Frequently Asked Questions (FAQs)