According to recent research by a well-known crypto exchange platform, a large chunk of the existing memecoins was generated last year.
The study illustrated the astounding rise of the digital token as the rest of the cryptocurrency world experienced massive transformation in the past few years.
Memecoins Surged In 2024
A report published by Binance Research stated that 75% of all existing meme coins in circulation were made between 2023 and 2024.
Data showed a surge in the deployment of the digital coin in the market, from only 92 created coins in 2021 to a staggering over 3,000 meme coins this year, a 3,161% increase in only four years.
The study explained that the main driver of these coin’s growth is the rising money supply which allowed people to dip their funds into riskier digital assets such as meme crypto.
The report also noted that token supplies is one of the reasons why meme crypto were able to attract investments, saying that altcoins and meme coins have the potential to rally communities on a common belief.
It also stated that one positive quality of meme coin is accessibility.
Growing incomes made it possible for people to invest in digital assets like meme cryptocurrency. Image: Jan Scheele
Market Capitalization Tripled
The Binance report also highlighted the meme coin’s market capitalization to altcoins has climbed up by nearly threefold. According to the data, the coin’s market capitalization in 2022 was 4% which went up to 11% this year. However, the report noted that the meme coin has not yet matched its peak of 12% in 2021.
In 2021, Dogecoin reached a market capitalization of $80 billion while Shiba Inu attained $39 billion.
The research said that some investors are being pushed to meme tokens because regulatory authorities have discouraged traders from taking Initial Coin Offerings (ICOs).
New digital currency projects depend on private venture capital funding, an approach that only allows a small number of tokens in public trading while the total valuation is high.
Are Memecoins Dead?
Meanwhile, the report stated that 97% of the coins are “dead”, meaning the trading volume of these tokens is $0. So far, only Dogecoin and Shiba Inu have retained traction in their years of existence.
What’s Next For Memecoins?
According to researchers, memecoins would still flourish in the industry but they believed that upcoming tokens should have “unique narratives and ideas that have long-term appeal” to investors.
They pointed out that coins that surpassed the long-standing dog-themed narratives and can move to other niches have greatly increased their traction.
An excellent example is the monkey-themed Pepecoin and feline-themed POPCAT which both went up during their market debut.
Moreover, the report said that meme currencies can ensure their long-term relevance by improving their use cases, urging the development of coins with innovative technologies.
Featured image from Unsplash, chart from TradingView
