Meme Coin Craze Soars on Decentralized Exchanges

Over the quiet weekend, several coins gained popularity on decentralized exchanges, with Coinbase's Base chain and Solana-based coins leading the charge. Notably, DeGene, a Base chain meme coin, surged over 230%, while other Base chain meme coins also attracted attention due to Coinbase's focus on developing its own ecosystem. Solana-based meme coins like WIF also saw significant growth, highlighting the rising prominence of these two chains in the present virtual asset market.

Surge in Popularity of Meme Coins on Decentralized Exchanges

Over the past weekend, a notable trend emerged in the cryptocurrency market, with several coins experiencing significant growth on decentralized exchanges (DEXs). This surge in popularity was particularly evident among coins based on the "Base" blockchain network and those built on Solana, which were introduced directly by Coinbase, the largest virtual asset exchange in the United States.

DeGen: The Rise of a Meme Coin

One standout performer was 'degen', a meme coin native to the Base chain. According to CoinMarketCap data, degen witnessed a remarkable 234.26% increase over the past week. This simple meme coin has gained traction due to its integration with Warpcast, a decentralized social network that allows users to reward writers with degen.

Warpcast's Influence

Warpcast's recent surge in popularity has significantly contributed to degen's accessibility and adoption. Within the Warpcast ecosystem, degen has found widespread use as a key currency. The platform boasts an impressive 100,000 monthly active users (MAUs) as of February.

Architecturally, Warpcast resembles Twitter but relies on blockchain technology. Notably, Ethereum co-founder Vitalik Buterin has endorsed the use of Warpcast, further enhancing its credibility and visibility.

Base Chain Momentum

The popularity of degen has propelled other Base chain-based meme coins into the spotlight, including BRETT, TOSHI, and TYBG. The underlying reason for this ecosystem's growth is Coinbase's involvement, as the exchange is actively developing its own chain, known as Base.

Coinbase's status as the world's largest virtual asset exchange gives its initiatives substantial market influence. Its ambition is not limited to a coin exchange platform but encompasses a comprehensive ecosystem for virtual assets, from conversion and creation to value generation.

Base-Based DEX Volume

Data from Dune Analytics indicates impressive growth in the trading volume of Base chain-based DEXs. Daily trading volume has surpassed $1 billion, demonstrating the adoption and momentum within this ecosystem.

Solana's Allure

Solana, on par with Base, has garnered significant attention as a driving force behind this year's virtual asset market growth. Numerous meme coins have emerged on the Solana blockchain, with WIF, which has soared over 2500% year-to-date, being a prime example.

Criticism and Debate

However, the growth centered on meme coins has not been without its critics. Some argue that these investments resemble lottery tickets, with small investments in multiple coins in the hope that a few will yield extraordinary returns, attracting a flood of investors.

Once these coins gain traction on decentralized exchanges, they are often listed on centralized exchanges like Binance and Bybit, leading to larger-scale transactions. This cyclical pattern has sparked a debate about the legitimacy and impact of meme coins.

Industry leaders hold contrasting views on this phenomenon. Joo Ki-young, CEO of CryptoQuant, expresses concern that meme coins overshadow genuine projects and hinder industry development. Conversely, Messari Vice President of Research Matze Bus Messari acknowledges the success of meme coins in attracting the public to blockchain and predicts their potential as a new asset class.

Accessibility Challenges

For Korean investors, accessing these coins poses challenges as they are primarily traded on decentralized exchanges. While degen is available on overseas exchanges like Bybit, it is not listed on any exchange that has officially registered its operations in Korea. Additionally, Uniswap and other decentralized exchanges account for a significant portion of degen's trading volume.

Decentralized exchanges inherently carry the risk of wallet hacking, and users bear the full responsibility for their actions. These factors limit the accessibility and appeal of meme coins for domestic investors.