Five Key Elements that Enable the Success of Memecoins in the Market: Cultural Foundation, Simplicity with Recognition, Entertainment and Humor, Low Barriers for Remixing, and Influential Figures and Soul Characters Driving the Trend. This article is sourced from an article by defioasis and edited by Wu Shuoququ in the Blockchain District.
(Summary:
What is $PEPE, and how did it become the God of Memecoins with a thousandfold increase? A comprehensive overview of the origin of Pepe the Frog meme, token economics, and controversies surrounding price manipulation.
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(Background:
Analysis of Memecoins: How to Determine Development Stages Using Social and Financial Data? Mastering the Timing of Entry.
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Table of Contents
Cultural Foundation
Simplicity with Recognition
Entertainment and Humor
Low Barriers for Remixing
Influential Figures and Soul Characters Driving the Trend
Note: This article only discusses the meme trend and should not be considered as investment advice or an endorsement of any project.
With the contradiction between venture capitalists (VC) and retail investors, as well as conflicts between project teams and community users in airdrops and anti-sybil measures, coupled with the inadequate liquidity within the industry, memes have become the solution. On Binance, the tokens with the highest trading volume are still MEMECOINS, with BTC, ETH, PEPE, SOL, FLOKI, WIF, DOGE, BNB, BOME, and SHIB ranking in the top ten. Six of them are MEMECOINS.
Recently, I have been thinking about the memes that can achieve higher market value, such as the original DOGE and the current PEPE. The reasons for their popularity cannot be separated from, but are not limited to, these five elements: cultural foundation, simplicity with recognition, entertainment and humor, low barriers for remixing, and influential figures and soul characters driving the trend.
Note: It is necessary to mention that this analysis may not apply to MEME in the 0-1 stage, but may be more suitable for MEME in the 10-100 stage.
The images of Pepe and Doge have long been popular in internet culture and have accumulated a large fan base on various social platforms. The crypto community is often composed of young and active internet users who have grown up with the development of the internet. They are familiar with these memes and are willing to incorporate them into new trends.
For example, the origin of Doge’s popularity in the internet community can be traced back to a photo of a Shiba Inu named Kabosu in February 2010. In December 2010, the Doge meme became popular on Reddit and was combined with broken English phrases. In 2013, various Doge memes were frequently seen, and the influence of the Doge meme had become significant. In December 2013, Dogecoin (DOGE) was born as a joke.
Pepe has an even earlier and more complex origin. It can be traced back to Matt Furie’s comic “Boys Club” in 2005, with the most classic line being “feels good man.” Later, more meanings were added to this phrase, such as the sad Pepe meme “feels bad man.” In 2008, Pepe became popular on the 4chan forum and was made into various memes. Around 2014, Pepe was basically present on all mainstream social media platforms. However, Pepe later gained controversial political connotations, making its image more complex. From 2017 to 2019, Matt Furie and the Pepe community worked to restore Pepe to its original intentions.
In April 2023, the Memecoin PEPE was launched, initially driven by the power of NFT communities such as Milady NFT holders and the Chinese community in Dubai. Later, there were allegations from Not Larva Labs co-founder Pauly against the PEPE team, as well as internal conflicts within the PEPE team and the chaos of the treasury being stolen and tokens being sold. Although PEPE entered the token history much later than DOGE and faced some controversies, it eventually became the third-largest Memecoin after DOGE and SHIB.
When it comes to Doge and Pepe, the memes come to mind immediately. These memes have high recognition and memorable points, making them easy to spread and visually distinguishable from others.
Memes themselves should be humorous and entertaining, and Memecoins should inherit this characteristic. They should not only be for investment returns but also for enjoyment. This relaxed atmosphere can more easily attract users outside the crypto community, newcomers, and young investors. Therefore, in the previous two bull markets, what attracted a large number of users to enter the crypto space was not valuable coins or applications, but Memecoins like DOGE and SHIB.
Assuming there is no price manipulation in the market, the selection of Memecoins should be based on first impressions – whether users can be immediately attracted to the fun and community spirit without much deliberation, and feel happy.
One notable feature of memes is that the barriers for remixing or creating memes are very low, allowing users to quickly spread them and attract a large number of participants to join in the creation and subsequent spread. Most memes have a fixed image or template, and users only need to change a part of the content. There are many free online tools and applications specifically designed for creating and sharing memes, simplifying the meme creation process. Remixing memes is not only a form of entertainment but also a way to convey personal opinions, emotions, and reflect the living conditions of people in different eras.
Each remix gives a new core to the meme, and the reason why memes become Memecoins is their continuous absorption of new cultural elements during their development – incorporating elements of crypto and blockchain, turning culture into a cultural asset transmitted in the financial aspect.
However, due to the ease of meme dissemination, some malicious individuals may label remixing memes with political or extremist tags, which can lead to certain social harm. Addressing these issues requires the joint efforts of influential figures, soul characters, and the community.
Influential figures play an important role in promoting and spreading memes. Whenever Memecoins are mentioned or promoted by public figures such as celebrities, internet personalities, and public figures from various traditional industries on social media, it quickly attracts market attention and speculation.
For example, Musk’s repeated mentions of Dogecoin on Twitter directly affected its market price and popularity. There was even a time when Musk was accused of market manipulation. When Musk posted a picture of a dog wearing a hat on Twitter, it caused a surge in WIF.
In addition, the spread and success of memes in some cases are driven by individual key figures or so-called soul characters. These soul characters are similar to the leaders of certain sects. For example, Roaring Kitty, the soul character in the “Retail Investors vs. Wall Street” battle, suddenly became active on social media after nearly three years of silence, causing a surge in GameStop and triggering six circuit breakers. Matt Furie, the creator of Pepe, may not have intentionally pushed Pepe to become a meme’s main driving force, but in the “Save Pepe” movement from 2017 to 2019, Matt Furie played an irreplaceable role in maintaining and reshaping the image of Pepe. Ansem’s continuous marketing and output of WIF.
The combination of internet popular culture and crypto has significantly influenced memes in the financial aspect. Meme culture brings entertainment into investment behavior, allowing more users who resonate with meme culture to enter the crypto world at a lower cost. However, it is still important to note that Memecoins are high-risk and highly volatile assets. While a sense of identification may be a prerequisite for investment, it is not a guarantee of investment returns. Investors are advised to approach Memecoins rationally.
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