Did MEME COINS Ruin Bitcoin Potential? (WORST Cryptocurrencies Of 2021)
Memecoins got a ton of attention during the first portion of this bull cycle, but people are apprehensive about diving back into these risky investments after the downturn we just had. And the excitement seems to have died down a little bit. The truth is a lot of people lost money buying the tops of memecoins earlier this year, and they didn’t need to be taking those risks. Believe it or not, the top crypto assets in the market actually outperformed the most popular memecoins over the past year.
Let’s get it! Welcome to BitBoy Crypto! Home of the BitSquad The largest and greatest crypto community in all the Interwebs My name is Ben. Everyday on this channel, I show you how to make money in crypto. If you like money and crypto, then make sure to hit that subscribe button. In this video, we’re going to take a look at the impact that memecoins have on the broader crypto market and see how the financial returns from these projects compare with the leaders of the industry. Before we get started though, make sure to sign up for the 5 ETH to 5 Million giveaway. Click the gleam.io link in the description to enter for a chance to win 5 Ethereum and thousands of dollars in other altcoins. Memecoins though are among the most controversial projects in the space. You either love them or you hate them. It’s true these silly coins bring a lot of newcomers into crypto, and in the long run, that can be a very positive thing, but sometimes people can have very bad experiences in these investments, too. Let’s face it.
The vast majority of these projects are pump-and-dump tokens that were only created to get their founders rich. This can give people the impression that the entire crypto market is just one big casino, and it also gives the media plenty of ammunition when it’s time for them to open up the FUD gates. Not to mention the fact that these projects take billions of dollars away from legitimate crypto assets and teams that are building something of value. We would probably be looking at a six-figure Bitcoin right now if these memecoins weren’t out there taking up so much attention and market activity. This is nothing new to crypto, but it seems to be getting worse with every cycle. This year, we saw the surprise success of Dogecoin that inspired countless derivative projects that flooded the market claiming to be the next big opportunity.
Shiba Inu was the most popular spinoff dog token to launch during this memecoin frenzy, but there were hundreds if not thousands of others, and they were all gathering significant investments until the market cooled off. Then it all came crashing down. Shiba held relatively strong but is now a fraction of its former market cap. And the same can be said for DOGE, which held up a little bit stronger even, but the rest of them have been entirely forgotten. It was frustrating for many of us to watch new investors stumble into such questionable projects, and one of the most respected teams in DeFi decided to do something about it. At the height of the dog money craze, some of the developers at Yearn.finance, one of the foundational platforms in Ethereum’s DeFi ecosystem, issued a memecoin of their own. They played along with the dog theme and called their token Woofy. But this was more than just a meme. Woofy was a re-denominated version of Yearn’s powerhouse YFI token. It just had a different name in smaller units. This means that people who put money into Woofy were actually investing in Yearn.finance, a DeFi platform with strong fundamentals.
In addition to the dog trend, the team realized that people were being drawn to memecoins because of something called unit bias. The YFI token has a very low circulating supply, so the unit price or price for one unit of a currency is very high, trading in the tens of thousands of dollars similar to Bitcoin. This high number is a bit of a turnoff for newer investors, even if they know they can buy these coins in fractions. It just seems like there’s less upside when the price is already so high. New projects like SafeMoon capitalized on this bias by launching their tokens with trillions of tokens in the supply. SafeMoon had a circulating supply of 580 trillion and a total supply of 1 quadrillion, which made the price very low and made it very easy to buy millions of tokens. Everyone had this idea that if only SafeMoon would reach $1 or even one penny, they can be rich. But the huge supply made this mathematically impossible. SafeMoon wasn’t really offering all that much underneath all the hype, so most of the money flowed out of this project as soon as uncertainty hit the markets. I get it. Memecoins are attractive because it seems like they have a lot more upside potential than more established crypto assets. But if you really dig into the numbers, it’s not actually true. This isn’t the case. Dogecoin made headlines throughout the year because it rallied from under a penny all the way up to 68¢ before crashing down to about 25¢ where it is today. This is certainly an impressive run, but it didn’t outperform everything else in the market as the suits on TV would have you believe. In fact, if you would have done some research during the past bear market or even the initial stages of this bull market, you would have found some incredible opportunities to put your DOGE gains to shame. For example, until the very beginning of this year, Polygon, formerly known as MATIC, was priced somewhere around a penny, and now it’s holding strong well over $1 after hitting an all-time high of nearly $2.50. These kinds of opportunities are everywhere in this industry. If you do enough research, you will find one of these gems every once in a while. Cardano had a very similar run from sitting under 5¢ for over a year to ranging between $1 and $2, with much more room to grow. If you like growth and gains though, make sure to click on that like button and subscribe to the channel. It helps us out and keeps you in the loop on the latest in crypto. But look at something as large as Ethereum, which has gone from under $100 during the bear market to over $4,000 in its recent highs. It’s more than a 40X. You don’t need to invest in jokes to make crazy gains in this industry. Plus, we all know that I got the market cornered on jokes anyways, am I right? In addition to having more potential upside, assets with real utility are much safer than these memecoins as well. Crypto markets are volatile and risky. This is part of the deal that we sign up for. But when the bear market comes, the memecoins usually get hit the worst. I covered this in a recent video where we reviewed some of the worst coins to hold during a bear market. Click up here to check that out. When retail investors end up getting wrecked in these assets, regulators start sniffing around and looking for excuses to get involved. Celebrities seem to make matters worse by promoting the most sketchy projects out there. Kim Kardashian and Floyd Mayweather brought some bad attention to the industry earlier this year with their promotion of a project called Ethereum Max. Despite its official-sounding name, it was nothing more than a memecoin. And the celebrities who endorsed it? Well, they were quickly called out for the obvious and undisclosed paid promotion. Memecoin degenerates will say that these projects are about the power of the community. It’s true to an extent. But a tradable token with no utility is not the best way to build and sustain a digital community. Just in the past few months, we’ve seen narratives around communities on the blockchain shift from memecoins to social tokens and NFTs. With the rise of the Bored Ape Yacht Club, we’ve seen a much more productive and healthy example of a blockchain-based community which allows its members to tap into a popular brand and exclusive club. In the coming years, social tokens will start to give creators the tools to finally harness the power of their communities and support themselves better than ever. The community aspect of these projects is very real. But with each passing day, this industry is giving us better tools to build these communities, and as this happens, memecoins will slowly become a relic of the past. That’s all I got. Be blessed. BitBoy out.