The Rise of AI Memecoins: A New Category of AI with 100x Growth Potential

The top 10 “AI Tech” tokens have a combined circulating market cap of $30.9 billion as of Q1 2024. On the other hand, the top 10 AI memecoins may have attracted more attention, but have a combined market cap of just $2.54 billion.

The emergence of artificial intelligence (AI) technology has sparked a surge in interest within the cryptocurrency realm. This convergence has given rise to a unique class of digital assets, aptly termed "AI Tech Tokens." These tokens embody the essence of AI technology, offering a diverse range of applications. From enhancing blockchain efficiency to powering decentralized autonomous organizations (DAOs), these tokens are poised to revolutionize the crypto landscape.

Among the vast array of AI Tech Tokens, a select group has managed to amass substantial attention. These tokens are renowned for their exceptional performance, which has seen them outpace even the most well-established cryptocurrencies. Thisといっても, performance comes at a price, as these tokens are often characterized by high volatility and unpredictable price movements.

As of Q1 2024, the top 10 AI Tech Tokens boast a combined circulating market cap of $30.9 billion. This figure serves as a testament to the immense capital that has flocked to this burgeoning sector. In stark contrast, the top 10 AI memecoins, despite garnering widespread attention, collectively account for a market cap of a mere $2.54 billion.

However, I believe that the true potential for outsized returns lies within the realm of AI memecoins. This emerging asset class combines the enduring appeal of memecoins with the cutting-edge advancements of AI technology. As a result, I anticipate that AI memecoins are poised to slowly siphon capital from not only AI Tech Tokens but also static meme coins and VC coins.

To put this into perspective, the total market cap of AI memecoin is currently on par with that of ETHEREUM CLASSIC. This provides a clear indication of the vast opportunity that still remains untapped within this domain.

A Decoding of the DeFi Summer Moment

Those who have been closely following the cryptocurrency markets will likely recall the pivotal role that YFI played during DeFi Summer 2020. This event, which saw a select group of DeFi tokens experience parabolic price surges, ultimately culminated in the emergence of YFI—a token that was "Fair Launched" in July and went on to achieve a market cap of $1 billion within a span of 2 months.

This development served as a catalyst for a large amount of on-chain capital to enter DeFi tokens, as it provided tangible evidence that a fair-launched DeFi token could indeed start from $0 and eventually reach $1 billion.

DeFi was a hot area in the last cycle because it was new, attractive, and gave people the ability to dream. With interest rates at 0%, there were rumors that DeFi would siphon capital from TradFi and become the future of finance. This led to a speculative frenzy on the chain, helping DeFi applications gain TVL and users to test the ecosystem.

When YFI launched, the total DeFi market cap was about $5 billion. It peaked at about $170 billion at the top of the market, an increase of 34 times. If GOAT is similar to YFI, then we are still in the very early stages as the total market cap of AI memecoins is less than $5 billion.

The DeFi cycle combines catalysts/factors internal to crypto (liquidity mining, Ponzi yield farming, speculation) and catalysts/factors external to crypto (interest rates drop to zero → capital enters crypto seeking yield), and bubbles form. AI Memecoin Omegacycle is no exception.

Reflexivity in the new paradigm

Reflexivity theory states that investors make decisions not based on reality, but on their perception of reality. These perceptions trigger actions that have an impact on reality or fundamentals, which in turn affects investor perceptions, which in turn affects prices.

Price is the total market cap of the AI memecoin space, fundamentals based on attention and how big the "dream" is. These are not "pure memecoins" in my opinion. They are closer to the "tokenized AGI" launched by all fair on pumpfun in my opinion. If VC wants to sell heavily, these tokens will be issued at a FDV of $1 billion with a 10% float. But these AI memecoins start at $0, and anyone has the opportunity to get in early.

In my opinion, reflexivity works as follows:

It’s really important to note that all of these tokens started out as pumpfun. It fits with the current zeitgeist, the Memecoin/AI supercycle, and anti-VC sentiment. Elon Musk expects AGI to be achieved in 2025–26, so if you believe in 4-year cycles, the hype peak could coincide with the top of cryptocurrencies in Q4 2025.

My Positioning

Last cycle, the total DeFi market cap reached $170 billion. If the industry reaches these valuations, it would mean about 40x growth from now. But since the total cryptocurrency market cap is much higher, we can easily surpass these levels. The key is to have