The meme-coin mania is in full effect in 2024, with cryptocurrency speculators and even serious, large-scale investors getting involved in the space. Yet, not all meme tokens are built the same, so traders and investors must always conduct their due diligence and understand the risks involved.
The term “meme” has been around since the 1970s, but its use in popular internet culture has brought the concept into the financial markets. You may have heard about meme stocks like GameStop (NYSE:GME) and AMC Entertainment (NYSE:AMC), which are volatile assets that have provided rapid returns for some traders but have also quickly lost money for investors who have made ill-timed trades.
Similarly, meme cryptocurrency coins are fast movers in both directions. Consequently, these tokens have drawn many speculators and serious investors into the fold in the 2020s.
With research and patience, you just might find the best meme coins to invest in for the summer of 2024.
The astounding growth of meme coins
Meme coins are different from other cryptocurrencies because of their lighthearted nature. However, the profits and losses from trading them are real, so meme tokens should be taken seriously.
These coins may depict animals and other types of characters or even political figures. Furthermore, meme coins are real attention-getters, and they tend to include an element of humor.
Perhaps most importantly, meme tokens are highly community-driven. As such, the element of investor engagement on social media platforms such as X and Reddit is crucially important.
Thus, intrinsic value and real-world utility may sometimes be de-emphasized with these tokens. Consider Dogecoin (DOGE-USD) as a prime example. Imprinted with a drawing of a Shiba Inu, Dogecoin was the very first meme coin, dating all the way back to 2013.
Few people took Dogecoin seriously upon its initial release. Yet, the token’s total market capitalization stands at a whopping $60 billion as of June 2024.
Dogecoin, which operates as a stand-alone, proof-of-work (PoW) blockchain, remains the most valuable meme coin today. However, it certainly doesn’t stand alone among today’s popular meme tokens.
Indeed, Ethereum (ETH-USD) blockchain-based ERC-20 tokens like Shiba Inu (SHIB-USD) and Pepe (PEPE-USD) have also gained in popularity, collectively growing in market value to over $100 billion in 2021.
Dogecoin and Shiba Inu are similarly themed tokens that both bear images of Shiba Inu dogs. There’s a friendly rivalry going on between the communities of these two fascinating meme coins, and the Dogecoin versus Shiba Inu debate continues to this day on social media.
While not a meme coin itself, Solana (SOL-USD) has played a major role in the emergence of meme coins. This token’s popularity has exploded due to the Solana blockchain’s low transaction fees and the ease in which tokens can be created on the blockchain.
New Solana-based meme coins, including a number of Solana Program Library (SPL) tokens, have emerged recently. Some examples of new meme coins include dogwifhat (WIF-USD) and Jeo Boden (BODEN-USD), which continue to gain traction among crypto enthusiasts.
The old guard versus the up-and-comers
It might seem odd to label Dogecoin and Shiba Inu as old-guard meme coins. Yet, they are two of the more established meme tokens as they’ve been around for a while and have name recognition among cryptocurrency traders.
The idea here isn’t to pit older meme tokens against the up-and-comers. However, there are certain trends and shifts that meme coin traders should pay attention to.
For instance, investors can take note of the open interest, which measures the aggregate value of the current, unrestricted holdings of an asset among all traders/investors, both retail and institutional. Believe it or not, the collective open interest of meme coins has surpassed $3 billion.
Don’t get the wrong idea. Dogecoin is still the top dog among meme coins. In fact, open interest for Dogecoin recently hit a record $1.8 billion.
At the same time, the new kids on the block like Pepe are nipping at Dogecoin’s heels (or paws). In May, open interest for the Pepe coin increased by nearly 50% to a mind-blowing $850 million.
Again, the idea here isn’t to divide investors into old-school versus new-school camps. It’s still a large and growing community among meme-token investors in which one coin’s success can benefit the meme-coin space as a whole.
Indeed, there’s no denying that this is a rapidly expanding space. In March (using a seven-day average) and across centralized exchanges, meme coins reached an impressive $13 billion in spot trading volumes. Consequently, meme tokens’ collective trading volumes surpassed those of non-meme tokens such as ether (ETH-USD) and Solana.
It just goes to show that a sense of community and fun can turn little-known assets into real blockbusters. Thus, while always keeping your position size reasonable, feel free to conduct your own due diligence on the wild and wonderful world of meme coins.
