Memecoins – A Zero-Game With Only One Winner

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Now, when thousands of memecoins dedicated to cats, dogs and politicians are hitting the market, more traditional crypto assets like Bitcoin or Ethereum seem to be losing their allure.

However, practice shows that it’s not all gold that glitters – in fact, over half of all memecoins are deemed malicious, leaving investors with broken hopes and empty wallets.

Here is why people still keep pumping millions in memecoins, and why such a strategy is mostly doomed.

Why are meme coins still buzzing

While the stellar growth of Elon Musk’s favorite DOGE could be well explained by his media influence, a meteoric rise of other similar tokens seems to be irrational.

Why then do so many people still buy what has zero intrinsic value, except for a funny picture in its narrative?

Meme coins are mostly created for fun or as internet jokes, and their value mostly depends on social media buzz rather than real-world use.

Attracting the mass user to high-risk assets will always be as popular as pyramids.

Besides, there is a large stratum of ‘zoomers’ who can easily be sold to via social networks.

All it takes is a bunch of thought-through marketing efforts, and it works well because of the following.

• Memecoin narrative is comprehensible for an average user, contrary to sophisticated tech ideas behind more substantial assets.
• With memecoins appreciated at a fraction of a dollar, they seem to be a much more affordable investment, compared to BTC and well-established altcoins.
• Promises of times three, times ten and higher rewards just make people put critical thinking aside. Newbies in the Web 3.0 space often believe in the concept of easy money – that’s exactly what attracts them.

Summing up, memecoins are a short-term thing, while human greed will never cease to exist.

There’s only one winner

The main drawback is that memecoins are only good for speculation, not long-term investing. And speculation is a zero-sum game in which most of the players will lose money.

All these magical stories about anonymous users earning millions on memecoins – like this or this – call for logical questions.

Did these traders possess any insider information? How much had they invested in dozens of memecoins before finally hitting the jackpot?

At the end of the day, it’s always the memecoin issuer who wins – it’s either a banal pump-and-dump scheme or the project’s gradual death that leads all other token owners to…