Meme Coins 101: What's Behind The New Crypto Frenzy

Imagine you have a sticker that everyone in your school loves, one day your sit mate gives you his biscuit in exchange for the sticker. The next day, all your classmates are gathered around your table offering their biscuits in exchange for the sticker, soon your sticker gains popularity in the whole school. This is how meme coins literally work.

Meme Coins are a type of digital money (cryptocurrency) that people trade, they usually start as jokes. They are a type of cryptocurrency inspired by internet memes and trends. Unlike traditional cryptocurrencies like Ethereum and Bitcoin which have specific use cases, the value of a meme coin comes from their viral appeal. Meme coins don't have any serious technological or financial purpose.

One of the greatest drivers of meme coins is their strong and passionate communities. Social media platforms like Twitter, Telegram, Discord and Reddit are always buzzing with groups promoting their favourite meme coin. These communities use memes, hashtags and influencer marketing to spread awareness and drive conversation.

Dogecoin (DOGE) - The first meme coin was created in 2013. Dogecoin is a parody of Bitcoin The token, featuring a playful Shiba Inu dog as its symbol, unexpectedly rose to widespread popularity, driven by its friendly and humorous culture -much to the surprise of Dogecoin’s founders.

In 2020, the SHIB coin (Shiba Inu) launched, capitalising on the virality of DOGE. The team behind SHIB leveraged the power of social media to create the SHIB Army - SHIB supporters, following the footsteps of Dogecoin.

The hype around meme coins continued to grow. In 2021, new meme coins like Akita Inu, Kisha Inu and SafeMoon launched on the crypto social media space.

Meme coin prices skyrocketed but plunged just as sharply during the 2021 crypto bear market. Environmental concerns, regulatory shifts, and market corrections fueled the decline, while fading social media hype highlighted their volatility.

In 2023, the PEPE token launched, reigniting the meme coin enthusiasm. Inspired by the famous meme character Pepe the frog, PEPE gained vitality and made headlines.

Examples of Meme Coins

• Dogecoin (DOGE): They're the pioneer of the meme coin trend, created as a joke by software engineers Billy Markus and Jackson Palmer, it featured the popular Shiba Inu as its Currently, Dogecoin has a market value of over $39 billion with a circulating supply of 147,930,966,383.705 DOGE.

• Shiba Inu (SHIB): The Shiba Inu is a breed of hunting dog from Japan. The Shiba Inu coin created by Ryoshi, capitalised on the virality of the Dogecoin and gained prominence in the crypto market. They are dubbed as the “Dogecoin Killer”. SHIB currently has a market value of $9.4 billion, with a total supply of 589,253,957,189,569.2 SHIB tokens.

• PepeCoin (PEPE): The mighty Pepe the Frog. Launched in May 17th 2023, Pepe is a meme coin launched in tribute to the famous Pepe Frog, it became a hit in the online cryptocurrency space due to its association with a popular internet meme. Pepe currently has a market cap of $5.50 billion. Like other meme coins, PEPE is highly volatile.

How Do Creators of Meme Coins Make Money?

Oftentimes, meme coins start as a joke, but the revenue they end up generating is no laughing matter. Here's how meme coin creators often make money:

1. Token-presale and ICO’s

Many meme coin projects launch through Initial Coin Offerings (ICOs) or pre-sales, where early investors buy large volumes at very low prices. As the hype builds and the token is listed on exchanges, the price may rise, and early holders cash out, and dump on people who entered late.

2. Liquidity Pool Incentives

Creators earn through decentralized exchanges (DEXs) by providing liquidity to trading pairs. They sometimes take a percentage of every trade via transaction fees.

3. Holding Developer Wallet

Creators allocate a portion of the token supply to themselves. If the coin pumps in value, they can sell their tokens for profit.

Are Meme Coins a Safe Investment?

NO. No investment is safe, and so is meme coin. Meme coins are for people who have a high risk appetite.

Meme coins are volatile and speculative. Their prices are largely driven by hype, trends, influencer tweets, and online buzz. While it's very possible to make big profits, it's also easy to lose everything within a split second.

Risks to consider include:

• Rug pulls and scams

• Market manipulation by whales

• Lack of regulation or oversight

• FOMO-driven decision making

How to Trade Meme Coins

Trading meme coins is relatively easy, especially on decentralized exchanges. Here's a quick guide:

1. Get a Wallet: Use a crypto wallet like Phantom (this is a personal recommendation and not a paid PR).

2. Fund It: Buy Ethereum, Solana, or another base token depending on where the meme coin is listed.

3. Choose a DEX: Use platforms like Uniswap (Ethereum), PancakeSwap (BNB Chain), or Raydium (Solana).

4. Trade Carefully: Always double-check the contract address of the meme coin to avoid scam copies.

5. Track Your Investment: Use app like CoinMarketCap or DEXscreener.

Pro tip: Always start small, and never invest money you can't afford to lose.

Understanding the Prices and Values of Meme Coins

• The value of a meme coin isn't based on fundamentals but memetics; how well the coin captures attention. Key factors influencing meme coin prices:

• Hype & Social Buzz: The more people talk about it, the more demand it creates.

• Influencer Endorsements: Elon Musk tweets about DOGE? Expect a price pump.

• Community Engagement: Active communities create momentum and loyalty.

Is Meme Coin the New Crypto Scam?

Not all meme coins are scams, but many scams disguise themselves as meme coins.

Common meme coins red flags are:

• No whitepaper or roadmap

• Anonymous developers with no history

• Locked or inaccessible liquidity

• High tax fees (e.g., 10% on buy/sell)

• Sudden developer silence or vanished community

If a coin seems too good to be true, it probably is. Stick to known names, verify contract addresses, and beware of pump-and-dump schemes by some idolos.

FAQs

Q: Can I become a millionaire from meme coins?

A: It’s possible, but very rare. Timing, luck, and early entry play a huge role.

Q: What’s the safest meme coin to invest in?

A: No meme coin is truly "safe." However, Dogecoin and Shiba Inu are relatively more stable due to large communities and exchange listings.

Q: Do meme coins pay dividends or rewards?

A: Most don’t, though some newer tokens offer staking or yield farming options.

Q: Should I invest in meme coins long-term?

A: They’re better suited for short-term speculation rather than long-term wealth building.

Q: Are meme coins legal?

A: Owning and trading meme coins is generally legal, but always check your country’s crypto regulation