There has been a new crypto meme since last month: it is called Bonk, and it is a token on Solana.
On the official website, it is called the first coin dedicated to dogs on Solana.
“Bonk’s contributors were tired of the toxic tokenomics of “Alameda” and wanted to create a fun memecoin where everyone had a fair chance.”
It is therefore an attempt to replicate the successes of Dogecoin and Shiba Inu, but with a token on Solana.
Bonk, the boom of the new meme crypto
When it was put on the market in late December, Bonk’s initial price was only 0.1 millionths of a dollar.
By the next day it had already risen to 0.2 millionths, so +100% in one day.
After rising to 0.3 millionths on 1 January, it really took off the next day. In fact, on 4 January it had already risen to 2.5 millionths, followed by a new all-time high touched this morning at 9.2 millionths.
In other words, this morning’s high is 9,000% higher than the initial price six days ago.
This is a resounding boom, to say the least, and is almost certainly purely speculative in nature. It is possible that those who are buying Bonk these days are doing so in the hope that it will replicate the 2021 successes of Shiba Inu or Dogecoin.
However, since this is a speculative boom, it is possible that a bubble has already formed on the price of Bonk, and it may even already be ready to burst.
SOL crypto recovers 40% thanks to Bonk meme coin
Even SOL, Solana‘s native cryptocurrency, is benefiting from this boom, not least because fees on Bonk token transactions have to be paid precisely in SOL.
On 29 December, the price of SOL hit an annual low of 2022 at just over $8, but only for a very brief moment. In fact, already the next day it was back near $10.
The fact is that 30 December was also the day of Bonk’s launch, and although it is not clear whether this is just a coincidence of time or the result of a studied strategy at the table, the fact remains that on 2 January the price of SOL began to rise again until it touched $14 yesterday.
It is worth mentioning that this morning Bonk made its new all-time high, while SOL appears to be down from yesterday’s $14.
SOL’s current price is still 95% below the highs of nearly $260 touched in 2021, but it is almost 60 % higher than the 2022 lows touched on 29 December. However, it is still below the $14.7 of 14 December, and far below the more than $35 of early November.
The link between Solana and FTX
The problem for SOL was the collapse of FTX, i.e., a major player in the Solana ecosystem.
It is no coincidence that Bonk’s home page makes explicit mention of Alameda, i.e., the company founded by Sam Bankman-Fried, and part of the FTX group, which was responsible for the collapse of the FTT token.
In fact, there are some who suspect that the Alameda team, or SBF itself, is behind Bonk’s launch.
If you don’t think it’s possible SBF/Alameda is behind $bonk you are intellectually dishonest. I’m not saying it’s guaranteed, but the more I look at it the stronger I believe the possibility is.
They said he wasn’t behind $SUSHI too. He already has done a dog coin $SAMO
— Ben Armstrong (@Bitboy_Crypto) January 3, 2023
Certainly, there were strong ties between Solana on the one hand and FTX, Alameda and SBF on the other. Certainly, there are also ties between Bonk and Solana.
Whereas on the links between the Bonk project and FTX, or SBF, it is fair to have doubts.
Huge speculative bubbles swelled on both FTT, the token of FTX, and SOL in 2021, then they burst in 2022. Bonk is also showing signs of being inflated by a bubble.
In fact, right now according to Orca’s data the BONK/SOL liquidity pool would give an annual APR of over 999%.
Surely this is an unsustainable APR, and it is certainly attracting many speculators. As soon as this absurd level of APR inevitably collapses, sales of Bonk could be triggered, just as purchases were triggered when it began to rise so much and in so few days.
Orca is a decentralized Solana-based exchange, and recently generated over $20 million in trading volume for trading pairs involving BONK, thereby suddenly accumulating thousands of dollars in fees for liquidity providers.
Several Solana-based projects have already integrated Bonk tokens, with burn mechanisms burning more than 1 billion tokens in the last 24 hours alone. However, out of a total supply of just under 100 trillion, this is still little.
Additionally, in the last 24 hours, BONK has recorded by far the largest volume of trades on exchanges in the Solana ecosystem.