Shina Inu | Encrypted | In this article:

  • What is a cryptocurrency meme?
  • Dogecoin and Shiba Inu
  • DOGE PUMP or how they influenced the rate of meme-cryptocurrency
  • Cons of meme-cryptocurrencies

Literally every week, news about the incredible success of meme-cryptocurrencies appears on the net. Two dog coins in particular are often talked about: Dogecoin and Shiba Inu. The unceasing hype of these cryptocurrencies has led many developers to create similar coins literally on their knees in order to make money on the wave of this popularity. Today we will talk about what causes such popularity, what it is moving towards and why it is still not worth investing in mem-coins.


What is a cryptocurrency meme?

Let’s start with what cryptocurrencies are. As the name suggests, meme tokens are assets that have been created based on internet memes, or inspired by current events, online communities, or individual influencers on the internet. For example, Dogecoin (DOGE), which was the first memecoin, is based on a meme picture of a Shiba Inu dog.

Why are there more and more memecoins? Because the process of creating a cryptocurrency today is quite simple, and new coins can be created at least every day.

And for the success of a meme-coin, it only needs to be associated with some current event or be attached to an Internet star. This is their main feature, most often they are promoted by media personalities – influencers. For example, when Elon Musk tweeted that in the event of a scandal around him, this scandal should be called “Ilongate”. And an hour later, the ELONGATE token was already launched.

Of course, not all of these coins are tenacious and many of them, even despite the explosive growth, subsequently depreciated completely. However, there are those that still not only remain popular, but also continue to grow and create competition in the cryptocurrency market (we are talking about the DOGE and SHIB dog races, and FLOKI on the tail). The key to success in their case is a strong association with influential people. Of course, all projects and cryptocurrencies rely on their user communities and the support of influencers, but it was only after Elon Musk became openly sympathetic to the first meme-cryptocurrency that this gave rise to a wave of new meme-coins, mostly dog ​​ones, that were promoted through social networks. The creators of memecoins strive to get into the news bulletin or light up in any other way, because this is the only way to increase the price of the token.

Dogecoin and Shiba Inu

The most famous coins are Dogecoin and Shiba Inu. We will briefly tell you about them:

Dogecoin (DOGE). Dogecoin was originally created as a joke, a fork of Litecoin far 1920 year, but eventually turned into a full-fledged cryptocurrency, especially after 2019 year Elon Musk began to promote it.

Per 2021 year the coin experienced its heyday, and now it is in the top ten most popular coins on the market. Elon Musk also continues to increase its popularity, each of his tweets throws the token to new record levels. Moreover, he is now collaborating with the developers of DOGE. V 2021 the token outperformed bitcoin in the number of Google search queries. By the way, the issue of DOGE is unlimited.

Dogecoin и Shiba Inu.DOGE PUMP или как влияли на курс криптовалюты.

Shiba Inu (SHIB). ERC standard token- on the Ethereum blockchain Shiba Inu was created in July 2000 of the year as a “decentralized spontaneous community creation experiment”. The value of the meme token began to grow rapidly, reaching its first peak in May of this year. The coin is named after the Shiba Inu dog breed, whose image is the Dogecoin logo. The token is also often called the “Dogecoin killer”, because Shiba Inu owes much of its popularity to it. Just like DOGE, SHIB depends on the words of Elon Musk. Just recently, October token fell by % after Elon Musk tweeted that he didn’t own it.

There are 1 quadrillion SHIB tokens in circulation, users can store billions and even trillions of tokens. % of this amount were handed over to Vitalik Buterin. However, Buterin burned most of it, and the rest % donated to charity. By the way, after that the price of the token fell several times. Now SHIB is one of the fastest growing assets, periodically falling into the top coins.

Like all meme-tokens, Dogecoin and Shiba Inu have a number of disadvantages – this is an underdeveloped infrastructure, and uneven distribution of coin supply. But we will talk about this a little later.

DOGE PUMP or how they influenced the course of the meme-cryptocurrency

Most interesting as Dogecoin, forgotten by everyone with 2015 has become so popular in such a short time. To explain this phenomenon, consider WallStreetBets.

WallStreetBets is a subbred (an online community on the Reddit platform) that was originally created as a serious forum for learning to trade on the stock exchange. However, later it became a place where investors exchange “quick money” ideas, brag about big earnings, or vice versa – proudly demonstrate losses. Earlier this year, the WallStreetBets subreddit was at the center of an online movement to boost the value of GameStop’s stock (which, by the way, rose dozens of times) and several other stocks in an attempt to bankrupt hedge funds that had taken large short positions in stocks. After the Robinhood exchange banned its investors from investing in GameStop due to unacceptable volatility, investors switched to Dogecoin. Since Dogecoin was a joke from the very beginning, without a serious concept, it is not surprising that, among other cryptocurrencies, it was WallStreetBets that fell on it. not affiliated with the WallStreetBets subreddit) there was an entry saying was DOGE ever $1? And while the answer was “no”, the members of the WSB community saw this as a call and decided to try and change that. Also in two other subreddits of this platform: CryptoCurrency and SatoshiStreetBets, users have agreed to buy cryptocurrency so that its price reaches $1. Similar campaign with April was held on Twitter and Discord – users posted posts calling for buying Dogecoin.

Then, at the beginning of the year, the army of Reddit users “brought” the coin to the point that it entered the top by capitalization. This can be considered the first cryptocurrency pump. Elon Musk also joined the wave of take-off. He has repeatedly tweeted niya, which in one way or another affected the mem-coin. In response to this, the token grew in price. For example, in May, he wrote about how cryptocurrency mining is harming the planet, but also mentioned the “potentially promising” work with Dogecoin developers. After Musk’s tweet, the value of the cryptocurrency increased by %. When Dogecoin clones like Shiba Inu (SHIB) appeared, they also became extremely sensitive to Musk’s tweets. -5 largest cryptocurrencies and updated its own maximum. Since then, the token has been in the top .

Such an incredible success, seemingly out of nothing, led users to start looking for similar sources of income. Tokens named after dog breeds or Doge have skyrocketed in value. New similar cryptocurrencies began to be created. This is how other dog coins appeared in different networks: BSC, Avalanche and others. CoinMarketCap refers to meme-coins over 12 projects. All of them are trying to repeat the success of Dogecoin. And some of them succeed (for example, Shiba Inu).

Dogecoin и Shiba Inu.

After such success, not only developers, but also users became more active, who began to look for alternative sources of income. Tokens with dog breeds or Doge in their names have become in demand. This is how the Floki Inu was born, a coin that was created in honor of Elon Musk’s Shiba Inu dog, which he named Floki. As an advertisement for the token, posters with the slogan “Missed Doge? Get Floki.” Elon Musk himself periodically posts photos of his dog on Twitter that affect the price of an asset. There is also a Dogelon Mars coin, the creators of which tried to combine both trends in one name. Dogelon Mars is also completely dependent on the Musk brand. Well, and many others like it. All these coins only sporadically grew in price.

Cons of meme-cryptocurrencies

Yes, we must pay tribute: meme-tokens, and in particular dog coins, have become one of the trends of this year. The total capitalization of all meme-cryptocurrencies has reached incredible levels of $12 billion. Many users buy these assets, however, if you think soberly, this is the most risky and stupid investment. Here’s why:

First, the obvious uselessness. As we mentioned at the beginning, memcoins have no value. These coins are not something new or unique, there is no project behind them that aims to improve technology. In addition, most of these coins are based on other blockchains. By purchasing such coins, you do not invest in either an idea or development, fundamentally there is nothing behind them but a picture.

In secondly, the success of the coins supports the hype, hype and the words of media personalities, but all these are short-term incentives. The price of memecoins is easy to manipulate, and it seems that even Elon Musk openly takes advantage of this. Yes, for some time it will swing the price, but it cannot last long.

Thirdly, rather low liquidity and huge emission. If Dogecoin or Shiba Inu tokens can be purchased on Binance and several other major exchanges, then all others are available only on DEX

.

Again, this is due to the very nature of these assets, which do not inspire the confidence of large sites.

With mem-coins, the risks of withdrawing liquidity from the pool are high, which is why the price drops sharply. There are not many scenarios for such a situation. Developers launch a coin and hold a significant part of it. They wait for users to buy it in the early stages, then quickly sell all their stock and disappear. Accordingly, tokens are rapidly depreciating, and their creators are the only ones who make a profit. This was the case with the SQUID coin, which was created against the backdrop of the popularity of the Squid Game series. The token was purchased about 12 thousands of users until the site and social networks became unavailable, and users were left with nothing.

The high risk of speculation is also due to the fact that the main volume of coins is held by large holders in several wallets. During aggressive marketing, they often sell off these coins. More recently, we have seen such a scenario.

Anonymous holder purchased Shiba Inu for $2022 last August. At the beginning of this month it was about % of the total number of coins. The wallet reached a fortune of $5.4 billion and later 296 days its owner made 4 transactions on trillion SHIB, which at the current rate is $2.7 billion. Against this background, the price of the token fell by 12%. SHIB whales sell their coins in parts, as there is not enough liquidity on the exchanges to carry out large transactions. The same goes for Dogecoin. More than half of all DOGEs are located on wallets. This means that from 25 billion of all coins in in circulation, about 5 billion is stored at one address. And if at least one of the owners decides to withdraw funds, this will greatly affect the price.

And yet, why do users buy in mem coins? It’s simple, as always, they are driven by the desire to make quick and huge profits. However, in the case of such coins, the one who comes last pays. Of course, early investors will earn on such coins as Dogecoin and Shiba Inu. And those who come now will only help them to fix profits. Investing in meme-cryptocurrencies is a lottery, no one knows who will be in the last car of this rollercoaster. Just as it is impossible to predict at what point this car will go again to the very top or only rapidly down. At the same time, even if you are lucky and the winnings pay off your investment, do not forget that most likely you will become a “paper millionaire”, since it is unlikely that you will be able to withdraw funds due to limited liquidity.

DOGE PUMP или как влияли на курс криптовалюты.

Despite all the risks of memcoins, this sector is growing and expanding, exchanges are adding tokens, large companies are giving the opportunity to pay in dog coins ( for example, the AMC movie theater chain in the United States). And yet it is a useless and high-risk investment, as there is nothing fundamentally behind these coins. Yes, dog coins will most likely continue to grow in price, fueled by Elon Musk’s Twitter pictures or any other short-term hype, but this will someday stop moving them. If you believe and expect that SHIB will be $1, then we will now crush your hopes. At this price, the capitalization of the token will exceed $443 trillion. For you to understand, the capitalization M icrosoft: $2,443 trillion, Google: $1,576 trillion, and Bitcoin: $1.2 trillion. Draw your own conclusions.

As soon as the hype for dog tokens ends (and it will end), other meme coins will appear after DOGE and SHIB, so our advice is: do not give in to the general hype, think with your head, before investing.


Frequently asked Questions

What is a meme token?

1643802030977

As the name suggests, meme tokens are assets that have been created on based on Internet memes, or were inspired by current events, online communities, or individual influencers on the Internet. For example, Dogecoin (DOGE), which was the first meme coin, is based on a meme picture of a Shiba Inu dog. For more information about this and the cons of meme-cryptocurrencies, read our full article.

Should I buy Dogecoin or Shiba Inu?

1643802030977Meme tokens are associated with a high risk of speculation , since the main volume of coins is held by large holders on several wallets. During aggressive marketing, they often sell off these coins. Read about other serious disadvantages of such cryptocurrencies in our material.

What determines the exchange rate of cryptocurrencies?

1643801445063Meme tokens, and in particular dog coins, have become one of the this year’s trends. The total capitalization of all meme-cryptocurrencies has reached incredible levels of $12 billion. Many users buy these assets, however, if you think soberly, this is the most risky and stupid investment. Here’s why:

First, the obvious uselessness.Secondly, the success of the coins supports hype, hype and the words of media personalities, but all these are short-term incentives.1643802030977Third, rather low liquidity and huge emission.

Dogecoin и Shiba Inu.

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