Crypto Traders Discuss Why Memecoins Have Been 2024’s Most Profitable Narrative
May 08 2024 - 5:00PM
NEWSBTC
Journalist and host Laura Shin interviewed crypto traders Ansem and
Kel, known on X as blkoiz06 and Kelxyz, for her Unchained Podcast.
They discussed why memecoins had become the most profitable
crypto trade this cycle and what the future might hold for the
sector. Related Reading: Is The PEPE Dream Over? Dissecting The
Factors Behind The Meme Coin’s Price Tumble Is There Value In A
Memecoin? To begin with, Shin asked the traders whether there was
substance in tokens based on memes, as it has been a big argument
against them. To Ansem, people “think too hard” about the value of
memecoins as projects. Moreover, he considers there’s no real gain
in comparing whether other altcoins deserve or have more value than
meme-based tokens. Why Memecoins Have Been 2024’s Most Profitable
Crypto Trade: Ansem and Kelxyz Dive into the wild world of
memecoins with @blknoiz06 and @kelxyz_! Discover how Ansem and Kel
trade memecoins, 🎢 the risks and rewards, and their predictions for
the future of memecoins 🚀 Plus,… pic.twitter.com/QovysNwAGP — Laura
Shin (@laurashin) May 7, 2024 Ansem further explains that the
crypto community is “very internet-centered,” with its members
being “internet people” since crypto’s origin. As a result,
the community is knowledgeable about the financial aspect but is
also knees-deep in online culture. The trader believes “there’s
value in memes and culture on the internet.” People in the
community are “financializing” meme virality and realizing that
it’s a possibility with crypto. Shin jokingly added that if this
trend had been popular in 2016, the Drake meme creator would be a
“bazillionaire” by now. The host seemingly referenced the
still-popular meme that originated from Drake’s Hotline Bling music
video. Agreeing with this argument, Kel asserted that, over the
last 20 years, many trillion-dollar businesses have capitalized
attention as their “winning trade businesses idea.” All these
trillion-dollar businesses (…) facilitate directing attention and
the way they’ve done that successfully has been, oftentimes, via
memes. One could even make the argument that memes are the core
engine of the entire Internet. The Risks And Criticisms Of Memecoin
Mania To understand why memecoins have become the narrative of Q1
2024, the traders discussed the risks and arguments against the
tokens. One of the biggest criticisms of memecoins is their
high-risk nature. Because they are much smaller and not backed by
institutional money, they can “be riskier” and “more easily go to
0.” Despite this, traders consider that many investors, especially
new ones, find memecoins attractive because they have the potential
to give 100x to 1000x returns. Moreover, losing money is not
exclusive to memecoins. To illustrate his point, Ansem compared the
people who bought Doge’s top to those who bought Bitcoin at $69,000
last cycle before it fell to $15,000. To the trader, how much a
token can drop and investors buying the top is part of the general
market dynamics instead of a characteristic of memecoins. However,
he clarifies that there is better criticism of the sector. Ansem
considers the shady behavior behind the projects’ teams a crucial
issue to address. To him, a framework could prevent creators from
controlling a large supply of the tokens and dumping them
immediately after launch or rug-pulling investors. In the replies
to the podcast, a user argued that the reason behind the recent
frenzy is driven by “the Financial nihilism and the lack of
liquidity that the youth has.” Adding that investors are “Buying a
mere coin is like a lottery ticket.” It is worth mentioning that
trading memecoins like lottery tickets is not an unseen phenomenon.
On-chain research platform Lookonchain recently reported a trader
seeing 4,906x gains in one day by precisely doing that. This guy
won a 4,906x lottery ticket today, so lucky! He trades MEMEcoins
like buying a lottery ticket, investing 0.1/0.2/0.3 $SOL for each
#MEMEcoins. He invested 0.2 $SOL($30) in $AGORA today, then sold 2M
$AGORA for $100K, with 959K $MILK(worth $47K) left. So he turned
$30… pic.twitter.com/fnJDQnavfI — Lookonchain (@lookonchain) May 7,
2024 Per the report, the trader invests 0.1/0.2/0.3 SOL for each
memecoin. Yesterday, the investor turned $30 into $147,000 by
turning 0.2 SOL into 2 million AGORA. What’s In Memecoins’ Future?
When asked what is in store for the sector, both traders concurred
that memecoins are not going away. To Ansem, the community behavior
towards memecoins is like that of NFTs last cycle. With NFTs,
investors felt like they were part of a community and were working
towards developing it. The shared experience of relating is another
crucial factor in the craze of meme-based tokens, as seen in
communities of tokens like Dogwifhat (WIF). Adding to that idea,
Kel asserted that “all memes will become coins” in the next ten
years. Moreover, the trader wouldn’t be surprised if “the
creation of a meme was natively financialized” by then, as the
trend of financialization of things continues to increase.
Ultimately, he believes the sector is in the early stages of this
trend as the community tries to “capture the moment of a meme” and
capitalize on it now that crypto has made financialization “trivial
from a tech perspective.” Related Reading: Dogecoin on the Rise:
Over 5 Million Wallets Now Profitable As Potential Surge Looms
Total crpto market is at $2.22 trillion on the weekly chart.
Source: TOTAL on TradingView Featured Image from Unsplash.com,
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