Blog: What is a meme coin?

A meme coin refers to a cryptocurrency that is mostly based on a meme that has spread on the internet and which almost always has a very low unit price. A meme typically refers to an image or phenomenon that has gained great popularity, especially on the internet. There are thousands of different meme coins on the market today, and new meme coins are also coming to the market at a steady pace.

              
One of the most distinctive features of meme coins is their unconventional marketing and community-centric nature. Successful meme coins that stand out from the crowd often get attention especially on social media, especially on Reddit and Twitter, where the community has a significant impact on the coin's price and popularity. Memecoins can fluctuate greatly in value in a short period of time, as they are subject to significant price fluctuations and volatility. This makes meme coins both attractive and extremely risky investments.
Meme coins as a whole can be called a kind of subcategory of cryptocurrencies. Most meme coins are created on top of the most popular platforms in the market, such as Ethereum, Solana or BNB Chain. As an exception, the world's first and most popular meme coin Dogecoin (DOGE) emerges, which operates on its own blockchain.
History of Meme Coins
The history of meme coins goes all the way back to 2013, when Dogecoin, the first meme coin on the market, saw the light of day. Dogecoin's popularity has grown tremendously with internet culture and community support, and over the years it has become something of a phenomenon. Dogecoin's contribution to increasing the visibility of meme coins cannot be ignored either. The visibility of meme coins began to increase for the first time in 2018, when Dogecoin managed to increase its market value to more than a billion dollars for the first time. This is when it began to reach column space for the first time in traditional media as well, and people's interest in meme coins began to grow.
However, 2018 was only a prelude to what was to come later. The year 2021 can be considered the real golden age of meme coins. The spring of 2021 was a positive time both for the wider cryptocurrency market and also for meme coins. At that time, Dogecoin, the largest meme coin in terms of market value, was once again accelerating the rise of meme coins in people's consciousness. At that time, the price of Dogecoin rose from a little over 0.05 euros to its current record price, i.e. around 0.60 euros. In addition to the general bull market, the rise was accelerated by the comments and Tweets of the world's richest person, Elon Musk, about Dogecoin on Twitter, a community and microblogging service at the time. Elon Musk's interest in Dogecoin was by no means limited to tweeting, as Musk also announced in July 2021 that he also owns Dogecoin himself.
The rise of meme coins in 2021 was by no means down to Dogecoin alone, as several other smaller meme coins also managed to increase their market value in Dogecoin's wake. When talking about the history of meme coins, one cannot ignore the cryptocurrency called Shiba Inu (SHIBA). Shiba Inu is based, as its name suggests, on an Internet meme depicting a Shiba Inu dog, like Dogecoin. However, it differs decisively from Dogecoin in terms of its technical implementation. While Dogecoin is located on its own blockchain, Shiba is programmed on the Ethereum blockchain. With a clear conscience, Shiba can be called the biggest riser of the recent bull market, as it managed to increase its market value from absolutely zero to more than 40 billion, at the same time becoming one of the largest cryptocurrencies by market value. In addition to Dogecoin and Shiba Inu, numerous other meme coins also managed to increase their market value considerably during 2021. It can be said with a clear conscience that the year 2021 brought meme coins to the attention of a larger audience at the latest.
Meme coins as an investment
Meme coins have grown in popularity among investors in recent years. The reason for the continued popularity of meme coins is that they have offered investors the opportunity for quick profits. In addition, meme coins have also increased investors' interest in cryptocurrencies and, for their part, inspired people into cryptocurrencies who might not have otherwise found the cryptocurrency market.
Investors should be aware that meme coins are often prone to speculation and many are not based on real technology or purpose, which can make their long-term success uncertain. Therefore, investors should be extra careful and do thorough research before buying any meme coin.
Although various meme coins have enjoyed great popularity among investors over the years, offering investors the opportunity to make quick profits, it is important to keep in mind the extremely volatile nature of meme coins. Meme coins are known in the cryptocurrency market especially for their exceptionally violent price movements. If, for example, the price fluctuations of Bitcoin and Ethereum are terrible, you should think twice before investing in meme coins.
Meme coins can be seen as a very risky investment in the cryptocurrency market. They are therefore not necessarily justified investment targets if the investor wants to minimize his risk. However, it is good for the investor to remember that, just like in investing in general, in the case of cryptocurrencies, return and risk always go hand in hand. Various meme coins have offered investors extremely high returns over the years. However, the flip side here is that many have also managed to lose their money on them.
If you are interested in investing in meme coins, the easiest and safest way to start is by buying the most well-known meme coins on the market, such as Dogecoin. The easiest and safest way to buy Dogecoin is of course to get it from Northcrypto's trading service. Meme coins with a higher market value like Dogecoin have already managed to establish their own position in the market by now, and investing in them cannot be considered nearly as risky as buying newer meme coins with a lower market value.
Summary
Meme coins refer to cryptocurrencies that are mostly based on a meme that has spread on the internet. Meme coins often differ from other cryptocurrencies in that the uses they offer can be very limited. In recent years, meme coins have become more and more aware of the larger public, and this has also been reflected in the growth of the market values of the most well-known meme coins. As an investment, meme coins can be seen as a very risky investment. If you are interested in meme coins as an investment, you should definitely check out Dogecoin, which is the first and most famous meme coin on the market. Dogecoin can also be seen as an investment target, which over the years has managed to establish its position in the cryptocurrency market.

Mikko Soon
Head of Private Banking
            

Last updated: 26.01.2024 15:00