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Cryptocurrency News Articles
Decoding the Rise of MEME Coins: Time Test, Community Consensus, and the Celebrity Effect
Oct 22, 2024 at 07:59 am
With an endless stream of MEME coins, players are tirelessly digging for potential "golden dogs." In some MEME groups, players share the CA (contract address) of the MEME coins they just bought.
With an endless stream of MEME coins, players are tirelessly digging for potential "golden dogs." In some MEME groups, players share the CA (contract address) of the MEME coins they just bought. The emergence of new MEME launch platforms has lowered the difficulty of issuing coins, and KOLs continue to drive various MEME projects to dominate the screens.
Although among the thousands of new MEMEs launched daily, only a few succeed, how can one identify potential stocks among the successful MEMEs? Is the rise of leading MEMEs coincidental, and what characteristics are worth noting?
To this end, PANews has sorted out 12 popular MEME coins with high market capitalization on Ethereum and Solana and their market performance (the selected targets are the highest market cap projects with the same name on each chain, as of October 18).
Over 70% of MEMEs Became Popular This Year, Most Require Holding for at Least Five Months for Amazing Returns
According to CoinGecko data, as of October 18, the market capitalization of the MEME sector has surpassed $61 billion, setting a new historical high. Among them, 10 MEME coins have entered the Top 100 of the crypto market, including not only established players like Doge, SHIB, and PEPE but also newcomers like WIF, BONK, and POPCAT.
The 12 popular MEME coins selected by PANews all emerged after 2023, with the vast majority being popular projects this year, accounting for over 70%. In terms of market size, these projects have a cumulative market capitalization exceeding $5.54 billion, accounting for nearly 9.1% of the overall MEME market capitalization, with POPCAT, Neiro, MOG, SPX, and GIGA having the largest market sizes. This sufficiently demonstrates the market participation of MEMEs.
Looking at the time it took for each MEME project to reach new highs, it averages 162.7 days. Projects like BITCOIN (HarryPotterObamaSonic10Inu), MOG, SPX, and GIGA took significantly longer, often requiring at least a year or more, indicating that MEMEs validated over a certain period are more likely to gain community recognition. In contrast, MOODENG, GOAT, and Daram surged to their peaks within a month, with the shortest taking only a few days, which is directly related to the current community enthusiasm.
From the change in the number of holding addresses after the coin price reached new highs, the average increase is 39.3%. Among these MEME coins, APU and MOODENG lead with address growth rates of 135.7% and 119.9%, respectively. In contrast, projects like BITCOIN, POPCAT, and Neiro showed no significant growth, with rates of only 5.3%, 3.2%, and 1.5%, which may be closely related to their listing on mainstream exchanges, prior accumulation of a sufficient user base, and the timing of price increases.
Moreover, these MEMEs have generally brought astonishing returns. According to statistics, the average highest return of the 12 MEMEs exceeds 37,000 times. Excluding the extreme value of GIGA at 245,000 times, the average highest increase of other MEME coins is 18,000 times, with BITCOIN, SPX, MOODENG, and GOAT performing particularly well, while Daram and POPCAT lagged behind. Of course, these return rates are based on market capitalization data backtesting, and very few players can capture all the increases, but some players have indeed gained thousands or even tens of thousands of times in unrealized profits.
Most Experienced Significant Drawdowns, Average Holding Value Reaches Over $10,000
When measuring the risk control ability of coin prices, the maximum drawdown rate is undoubtedly one of the commonly used indicators and a psychological test for holders. From the data, excluding GOAT and Daram, which have just become popular and are still in an upward channel, other MEME coins have experienced varying degrees of drawdown from their historical highs, with an average maximum drawdown rate of about 49.1%. Among them, MICHI, APU, MOG, and MOODENG saw the largest declines, at 87.7%, 87.5%, 71.1%, and 65.4%, respectively, indicating that their holders face significant loss risks if they bought at the peak. In contrast, GIGA, FWOG, POPCAT, and Neiro's maximum drawdown rates are all well below the average.
Additionally, looking at the number of days required for drawdown recovery, these projects average about 23.9 days. Among them, MICHI, APU, MOG, and MOODENG, which had the highest drawdown
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