Crypto Traders Discuss Why Memecoins Have Been 2024’s Most Profitable Narrative

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As a crypto investor with a background in technology and internet culture, I find the rise of memecoins to be an intriguing development in the cryptocurrency market. Ansem and Kel’s perspectives on the value of memes and their potential profitability resonated with me. In today’s digital age, where internet culture drives many aspects of our lives, it’s no surprise that people are capitalizing on meme virality through memecoins.

In an episode of my podcast, Unchained, I interviewed two prominent crypto traders, Ansem (alias blkoiz06 on X) and Kel (alias Kelxyz). They shared their insights on why memecoins have emerged as the most lucrative investment in the current cryptocurrency cycle. We also delved into potential future developments for this sector.

Is There Value In A Memecoin?

Initially, Shin questioned the traders about the validity of meme-based tokens in the market, which has been a contentious issue. According to Ansem, however, people excessively ponder over the worth of memecoins as investment opportunities. Furthermore, Ansem believes that it is unnecessary to evaluate and compare the value of other altcoins against meme-based tokens.

Why Memecoins Have Been 2024’s Most Profitable Crypto Trade: Ansem and Kelxyz

Dive into the wild world of memecoins with @blknoiz06 and @kelxyz_!

Uncover the intricacies of Ansem and Kel’s memecoin trading: the perks, pitfalls, and their insights into memecoins’ future prospects.

Plus,…

— Laura Shin (@laurashin) May 7, 2024

Ansem elaborates that the cryptocurrency community is heavily reliant on the internet, with its participants being described as “tech-savvy internet users” due to crypto’s inception. Consequently, they possess a strong understanding of financial matters while being deeply immersed in online culture.

The trader holds the perspective that memes and online culture carry worth. Members of the community are recognizing the financial potential of meme popularity and exploring this opportunity through cryptocurrency.

If we had seen this trend back in 2016 when the Drake meme took off, the creator would have become a “bazillionaire” by now, according to Shin’s humorous remark. The host hinted at the enduring popularity of the meme that emerged from Drake’s Hotline Bling music video.

Over the past two decades, I’ve observed that several trillion-dollar businesses have thrived by focusing on capturing and monetizing people’s attention as their primary business strategy.

Trillion-dollar businesses have become influential in capturing and guiding public interest, achieving this feat frequently through the use of memes. Memes can be seen as the driving force behind the entire Internet, given their significant impact.

The Risks And Criticisms Of Memecoin Mania

In Q1 2024, memecoins have emerged as a popular topic among traders. To grasp the reasons behind this trend, they deliberated over the potential risks and counterarguments related to these tokens.

One common criticism levied against meme coins is their inherently risky nature. Given their relatively small market size and absence of backing from financial institutions, these assets can be more volatile and potentially plummet in value with greater ease compared to more established currencies or securities.

In contrast, traders believe that memecoins hold significant appeal for numerous investors, particularly those who are inexperienced, due to their capacity to generate massive returns, up to 100x or even 1000x.

As a crypto investor, I can tell you from experience that losing money isn’t limited to investing in memecoins. To drive this home, Ansem drew an analogy between those who purchased Dogecoin at its peak and those who bought Bitcoin when its price reached $69,000 during the last market cycle before it plummeted to $15,000.

As a researcher studying financial markets, I’d like to offer an alternative perspective on the behavior of traders regarding token prices and memecoins. Instead of attributing excessive price drops solely to investors buying at the top for memecoins, I suggest considering this phenomenon as part of the broader market dynamics. However, it’s essential to acknowledge that there is room for improvement in the criticism and analysis of the crypto sector as a whole.

As a researcher, I recognize the significance of addressing the questionable actions of project teams regarding their token supplies. The potential for creators to manipulate the market by quickly flooding it with tokens or conducting a “rug pull” is a serious concern. To mitigate this risk, I propose implementing a framework that restricts the control over a substantial amount of tokens at the time of launch. This measure could help protect investors from sudden price drops and ensure a more stable market.

As a crypto investor, I’ve come across this perspective in various podcast discussions. The argument goes something like this: “The recent surge in interest and investment in cryptocurrencies can be attributed to the financial despair and scarcity of liquid assets among younger generations. In essence, buying a single coin feels like purchasing a lottery ticket.”

Noteworthy is the observation that traders making a comparison between memecoins and lottery tickets is nothing new. A recent report from on-chain research platform Lookonchain revealed an instance of a trader experiencing a staggering 4,906x profit in just one day by following this approach.

This guy won a 4,906x lottery ticket today, so lucky!
He trades MEMEcoins like buying a lottery ticket, investing 0.1/0.2/0.3 $SOL for each #MEMEcoins.
I made an investment of $60 worth of Solana ($SOL) in Agora ($AGORA) today. Subsequently, I sold a massive amount of $2,000,000 worth of Agora, which translated to a substantial gain of $100,000. Presently, I still hold $959,000 worth of Milk ($MILK), equivalent to approximately $47,000 in value.
So he turned $30…
— Lookonchain (@lookonchain) May 7, 2024

As a crypto investor, I followed the report suggesting an investment of 0.1 to 0.3 SOL in memecoins. Yesterday, my $30 investment transformed into an astonishing $147,000 when I exchanged 0.2 SOL for approximately 2 million AGORA tokens.

What’s In Memecoins’ Future?

When asked about the future of the sector, traders agreed that memecoins will continue to exist. According to Ansem, the public’s engagement with memecoins resembles the enthusiasm surrounding NFTs during the previous market cycle. Investors felt connected to the community and were actively contributing towards its growth.

As a researcher studying the popularity of meme-based cryptocurrencies, I’ve discovered that the shared experience of relating is a significant factor fueling their hype. For instance, within the thriving community of Dogecoin (DOGE), people connect over the shared appreciation for the quirky Shiba Inu meme and the sense of camaraderie it fosters.

Expanding on Kel’s perspective, it is likely that “all memes will transform into digital currencies” within the next decade. Furthermore, the trader anticipates that “the generation of a meme could inherently incorporate financial aspects” by then, given the ongoing trend toward financially valuing and trading various items.

In the long run, he holds the conviction that this industry is just beginning to experience this trend, with the community striving to seize the opportunity presented by memes and financially benefit from them, given how crypto technology has simplified financialization in technical terms.

Crypto Traders Discuss Why Memecoins Have Been 2024’s Most Profitable Narrative

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2024-05-09 00:05