Memecoin frenzy in numbers: the phenomena of 2024 pre-halving bull run | Opinion
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For the second time in the crypto market history, memecoins spearhead the new bull run while demonstrating unprecedented growth. Some slam meme tokens for having “zero value” and being harmful to the industry, but others praise them for engaging communities and attracting new users to crypto. Meanwhile, the latest memecoin boom has sparked a surge in transaction volume in web3 wallets, defining new leaders in the crypto storage landscape.
Regardless of what anyone thinks about the value of memecoins, their influence on the crypto market right now is hard to overstate.
The new rise of dog coins
The soar of meme tokens marks the emerging bull run. By the end of March 2024, the capitalization of top meme coins reached $80 billion, which is close to the all-time highs seen during the previous rally in 2021. At the time of writing, the total value has corrected to nearly $55 billion.
The top memecoins by market cap are Dogecoin and Shiba Inu, well-known from previous alt seasons, but new leaders have also popped up. Among them are BONK, “The Dog Coin of the People,” and Book of Meme (BOME)—a Solana-based token that skyrocketed 457 times since its listing on Binance on March 16, only to plummet by 50% later.
Another leader in the race is Dogwifhat (WIF), also based on Solana. As the token has gained 22X since January, its supporters managed to raise 690,000 USDC to showcase the project’s mascot at Sphere in Las Vegas.
How the current meme rally is different
Analysts note how “weird” the current rally is compared to previous market cycles. Zach Rynes, the community liaison at Chainlink, points out that the market skipped several stages—liquidity shifted from Bitcoin directly into memecoins, bypassing several intermediate steps such as Ethereum and other high-cap coins.
The market capitalization of memecoins has already approached its all-time high level of 2021. But this time, this is perhaps only the beginning of the rally—the Bitcoin halving hasn’t even happened yet, while market peaks typically occur within one year after the event.
Web3 wallet activity spikes
We are now witnessing a sharp increase in the crypto wallets’ transaction volume, which can be at least partially attributed to the memecoin frenzy. Among the top five web3 wallets, one saw growth of 18% in weekly active users, while two others experienced an increase of almost 50%.
What stands out is the transaction count: the weekly figures in two wallets have surpassed those of MetaMask, one of the most widely used web3 wallets that gained recognition in previous market cycles. Leading the list is Bitget Wallet—a solution by a crypto exchange Bitget that acquired the BitKeep wallet last year and has been developing it under its own brand since then. The wallet recently listed trading pairs with BOME and BONK, which could have contributed to the surge in transaction volume.
Another chart clarifies how the web3 landscape has changed in recent months and weeks: the percentage of transactions processed by MetaMask dropped from 100% to nearly 19%, giving way to new players.
“Think twice before calling it stupid”: what experts say about memecoins
Market experts have directly opposite opinions on memecoins. Among those articulating a popular point of view is Franklin Templeton, an American trillion-dollar asset management firm. The company notes that meme coins have appealed to many traders due to low fees and the potential for quick profits. Experts warn that tokens originating from internet memes “have no inherent value or utility.” “Meme coins harm the crypto industry,” adds Ki Joung Ju, the founder and CEO of the blockchain analytics firm CryptoQuant. He continues:
“It’s frustrating to see billion-dollar-cap meme coins overshadow hardworking teams building legit products to advance this industry. Easy money can’t drive industry-wide progress.”
However, many market participants argue for the opposite. It’s crucial to think twice before labeling memecoins as “stupid and valueless” since they can benefit blockchain ecosystems by attracting new users and developers, says crypto entrepreneur Arthur Hayes.
Memecoins will remain a vital part of the crypto industry and potentially evolve into a new asset class, believes Maartje Bus, VP of research at Messari. They “inadvertently” introduce newcomers to web3 basics, including decentralized exchanges and crypto wallets, and bring people together in the blockchain space.
The evolution of memecoins
Like many crypto phenomena, memecoins have the potential to evolve and become more than just a tool for short-term gain. Vitalik Buterin suggests that meme tokens can contribute positively to society, serving as tools for funding public projects.
Whatever memecoins may become in the future, they are transforming the market right now. In the current market phase, meme tokens drive up the value of L1 chain coins such as Ethereum and Solana and reshape the web3 wallet leaderboard. The upcoming rally will show further changes that meme coins will bring to the crypto market.
