Memes and dogcoins have been an integral part of the ongoing market-wide bull run in the cryptocurrency markets. Among the large number of these tokens that were flooding the market, two of them, memecoin Dogecoin (DOGE) and Shiba Inu (SHIB), gained the most attractive and popular.
Recently, SHIB started to rise on October 23 from trading at $0.000028 to an all-time high of $0.000086 on October 28. Since then, the coin has cooled down to $0.000052. Despite this, the coin has gained 195.5% in the last 30 days and an incredible yearly gain of 72,954,679.8%.
This led to the token briefly appearing at number eight in the list of the top 10 cryptocurrencies by market cap, but due to the drop in price, the token slipped from the top ten to drop to eleventh place with a market capitalization of around $32 billion at the time of writing. this report.
These returns put token investments into the race for “the greatest trade ever” as it was revealed that a single crypto wallet address purchased $3,500 worth of SHIB tokens in August 2020, which has doubled to a value of more than $1.55 billion at the market peak. Another wallet, at one point, held over 13% of the total supply of over 549 trillion tokens. However, this whale wallet transferred $2.3 billion worth of SHIB tokens on November 5 in four equal transactions to four different transactions.
These returns have led to a lot of public interest in and around the token. On the heels of all-time highs, SHIB has started to gain credit for the token’s utility as well. Despite its extreme volatility, Adam Aaron, CEO of AMC Theaters, announced that the company is considering adding the token as payment for ticket purchases. Le Bistrot d’Eleonore et Maxence, a Paris bistro, has begun accepting SHIB as payment.
Momentum from SHIB token carried over to DOGE as well as investors began to distribute their dividend from SHIB to DOGE, resulting in the token gaining 44% in one day on October 28 and reaching a 90-day high at $0.33. This rally led the coin to the ninth place in the top 10 cryptocurrencies by market capitalization. The token is currently trading at $0.25, nearly 65% shy of its all-time high of $0.73, which the coin hit on May 8, propelled by Elon Musk’s tweets. At the time of writing, the market cap is close to $35 billion.
Cointelegraph spoke with Johnny Liu, CEO of cryptocurrency exchange KuCoin, about this phenomenon that has caught the attention of many retail investors. He said, “The popular meme broke out in the top ten and for some time topped the charts in terms of the volume of transactions on exchanges, surpassing even Bitcoin. We can say that the chances of becoming a permanent member of the top 10 clubs are very high.”
So, if some of the most notable tokens are “made”, could other high-risk tokens join their company at the top of the market cap charts, or is there just room for so many tokens?
Meme tokens and dogcoins are flooding the market
After the rise in popularity of Dogecoin, there have been a large number of dogcoins and other meme tokens joining the industry. One of these tokens was SHIB, which has since reached market capitalization in the same DOGE range. The SHIB development team has also developed another code called Doge Killer (LEASH). The token is currently exchanging at $3,256.73, with a return of 130.3% recently.
Another icon trying to capitalize on the constant hype is Dogelon Mars, an icon based on Tesla CEO Elon Musk and his love of space travel. In October, the coin posted a gain of over 3780%, along with being listed on OKEx and Crypto.com on October 29, outpacing SHIB’s 850% gain.
There are many tokens launched on different blockchain networks, sending meme tokens through the crypto ecosystem. For example, the Australian Shephard Secure Token (ASS) is a dogcoin based on the Binance Smart Chain (BSC) and Samoyedcoin (SAMO) is a dogcoin on the Solana network.
Liu stated, “It seems that the more advanced the cryptocurrency, the stronger its position, and it is not easy for beginners to reach the top and take their place under the sun.” He added that having two meme coins makes it in the top ten is more than enough and other meme coins don’t stand a chance. However, he said, “But that’s the beauty of cryptocurrency — anything can happen.”
Justin Trollip, a core team member at Pangolin, a decentralized exchange, told Cointelegraph that the short-term potential of all highly speculative tokens and dogcoins via blockchains is unpredictable:
“We are in a raging bull market, so speculative assets with a massive upside tend to do well. We are in a meme cycle at the moment, so I think there is room to go up on a lot of these coins. Again, it’s about the particular timeframes. You as an investor. Personally, most of the people I’ve seen that have made big gains on meme tokens generally fail to make profits and consider them as long-term assets. I’ll argue, this is a risky strategy.”
Several new meme tokens made impressive gains in October, with SAMO seeing a 2925% gain in October to reach a market capitalization of $389 million, and HOGE from Hoge Finance up 2,923% to currently have a market capitalization of $189.79 million from $15 million. dollars at the beginning of October. But this does not mean that these types of symbols will continue to post such impressive heights.
Related: All hail Shaybah? Rise of Dogecoin pretenders fueled by meme frenzy
Trollip added, “For these tokens to continue to perform well in the top ten over the next few years, they will need to outperform some very cool projects and the class of mature investors in cryptocurrency. I personally believe they will be outperformed over a period of time. longer.” He also noted that the recent trend of meme icons is entirely driven by speculation and in some cases, even social media manipulation. But, as we’ve seen with SafeMoon, he believes there is a limit to where marketing takes a token.
Shillings on social media for meme icons
Social media plays an important role in the increased adoption of these tokens and dogcoins. Elon Musk is one of the market forces that most often indirectly influenced the price movements of DOGE and Floki Inu (FLOKI) through sporadic posts on Twitter.
Floki Frankpuppy pic.twitter.com/xAr8T0Jfdf
– Elon Musk October 4, 2021
However, it can be argued that such activities that directly affect the price of assets can displease financial regulators such as the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC).
From this perspective, Liu opined that “If Elon receives advertising money from the creators of DOGE, he should be held liable because he did not notify his Twitter messages were ads. But if Elon buys tokens and writes that he believes in them, that is his right and there is nothing criminal about this.” .
Related: Crypto’s Charged Relationship with Elon Musk: Ambassador or Responsibility?
Such activities in the traditional financial markets with assets like stocks, commodities, bonds etc. are prohibited by the financial regulators. According to Trollip, opening the doors to this world of cryptocurrencies will lead to the loss of Satoshi’s original vision:
Currently, traditional assets are still pumped out behind closed doors in an orderly fashion. Not that it doesn’t happen, it’s just that within this framework, the winners are already predetermined. I am worried that you are starting to see this hack into cryptocurrency already. With the current obsession with get-rich-quick schemes, most people don’t care about Satoshi’s ethics and only care about money.”
Such a situation is likely to be very detrimental to cryptocurrencies in the long run. This could reflect the progress the industry has made in general over the years towards leading the financial world into a more dystopian future.
However, new meme tokens and dog coins are entering the market every day, and retail investors are tempted to buy in hopes of repeating the gains made by DOGE and SHIB in the past. In fact, the hype over dogcoins has grown so much that it is said to increase demand for real dogs.
While a fluffy Shiba Inu puppy is certainly a good way to ensure the long-term happiness of the owner, meme coins are not a sure bet and should be traded at your own risk. A speculative bet on a low market token may not pay dividends, as would an investment in a well-established Dogecoin since the uptrend and social media sentiment may already be at an all-time high.