So far this year, meme coins have become a craze, and they have had a wacky time on the market. After a massive surge at the start of the year, meme coins were shown to be vulnerable to the May Bitcoin meltdown.
If meme coins are dead or will the abnormal price movement continue, what’s the answer to this question?
There are many who are looking forward to the conclusion of this year’s meme craze.
Elon Musk, Dogecoin and the meme coin craze
Elon Musk’s remarks regarding Doge kicked off the whole thing. As soon as Tiktok and celebrities started using it, the meme currency became an overnight sensation.
It was just a couple of days after this tweet that Dogecoin surged 10x, followed by Shiba Inu, Safe Moon, and others until the May collapse that brought them all down.
There are those who believe that meme coins have died and that the mania has ended despite the fact that the whole crypto market has been depressed. Lark Davis, a YouTube crypto specialist, disagrees.
Many think that meme coin season, which some have dubbed “meme coin season,” was detrimental to the legitimacy of cryptocurrencies. This is terrible. According to Lark,
“We have learned nothing!?”.
Assuming this is true, Lark seems to concur that meme currencies are detrimental to the space. There is always a climax to the hype. Meme coins are nothing more than a passing fad, and like all fads, they will eventually go away.
There is no value proposition or use case for meme currencies, thus this trend is pointless.
To have a value proposition, an organization or a currency must address a real-world problem. There are a number of reasons why oracles are important to the safe blockchain. For example, oracles are the linkages to off-chain data for the blockchain. Those are real-world benefits.
Ethereum is a good illustration of this. All transactions on the Ethereum blockchain utilize the ETH currency as a gas fee.
Meme currencies and technology, according to others, are beneficial since they enable users to pay their expenses.
Issues With Dogecoin
Dogecoin’s tokenomics are poor due to the fact that there is an endless supply of tokens. First and foremost, this does not portray cryptography in a positive light.
Crypto is designed to be a replacement for the US Dollar’s infinite inflation. In addition, a single wallet owns almost 30 percent of Dogecoin. Newcomers to cryptography should not use this method.
Because those who are new to cryptocurrency do not consider the concerns of others who have whale wallets. They believe that Dogecoin is a terrific currency that will bring them a lot of money based on what they have heard. Consequently, newbies are often unaware of the dangers of investing in Doge.
A meme coin like Doge is not going to pay everyone’s expenses, which is why it should not be promoted as a panacea. Nobody uses the currency known as Dogecoin as their own.
Investing in Doge has a high level of risk, which newbies aren’t familiar with. When someone sees a tweet like “Dogecoin is heading to $10,” they don’t bother to look into it since their reasoning goes into overdrive and they only think about money.
It’s been an incredible year for Dogecoin, which was established by two coders in 2013 as a “joke” and has risen more than 12,000 percent at one point.
Supporters of the cryptocurrency include Elon Musk, Tesla’s creator, and Mark Cuban, who often tweet about their support for it. Elon Musk’s comments have a significant impact on the price of Dogecoin.
But the cryptocurrency featuring a Shiba Inu dog on its virtual coin is thought to have peaked right before Elon Musk’s much-anticipated appearance on SNL last month.
As a result of Elon Musk’s appearance on SNL, the price of Dogecoin dropped 30% in only a few seconds, perhaps because Musk is aware that his public pronouncements cause large volatility increases. And it’s doubtful that the price will ever return to its pre-event level.
Even when Dogecoin’s price rose to an all-time high of $.7408 shortly before this presentation, its market value surpassed $100 billion. The price of the cryptocurrency, which had been widely promoted on social media, has almost hit the $1 mark.
At $47 billion, Dogecoin’s market capitalization is nearly half of what it was a month ago.
Experts: stay away from Meme Coins
Cryptocurrency enthusiasts have expressed concern that the recent surge in Dogecoin and Shiba Inu is a “death trap” for regular investors who join at present prices.
With an estimated market value of close to $80 billion, these Shiba Inu-based crypto have risen to the top 10 digital assets.
After breaking over the psychological milestone of $0.30 today, Dogecoin’s one-year gain has been nearly 11,000 percent, while its one-month gain has been approximately 50 percent.
However, Shiba Inu has gained 1,000% in the previous 30 days alone. This is a remarkable achievement.
Experts feel that the surge is being fueled by those who believe in these meme tokens, rather than the fundamentals.
These tokens are not based on fundamentals, since they are essentially community tokens. These are speculative pump-and-dump currencies with no practical use.
Crebaco Global’s Sidharth Sogani, founder and chief executive officer, says that Shiba Inu is having a negative influence on the overall crypto market volume because of its impact on Shiba Inu.
According to industry estimates, the trading volume of Shina Inu on certain platforms was three times that of bitcoin.
An earlier surge in GameStop’s stock earlier this year was attributed to similar buzz on social media and online forums like Reddit.
In February, Dogecoin rose over 800 percent in 24 hours when a large number of Reddit users became aware of the cryptocurrency. It’s still 60% away from it’s all-time high of $0.73, which was reached in May 2021, despite the latest rise.