In other words, if you had put $1,000 in FLOKI in early October, your investment would now be worth around $4,000.With a market capitalization (cap) of about $2.5 billion, it ranks among the top 3,000 cryptocurrencies.
This year has so far witnessed lucrative returns in dog-centric meme tokens and in most cases, Elon Musk’s words on Twitter (NYSE:TWTR) have been the catalyst behind the moves. First came Dogecoin (CCC:DOGE-USD), which is up about 5,900% year-to-date (YTD). Then came the Dogecoin-killer Shiba Inu (CCC:SHIB-USD). Both cryptos have become darling meme coins, bringing significant returns to early investors.
Thanks to the recent surge, the new member of the pack, FLOKI-USD, is getting increased attention. Yet, given the high volatility and risks that come with meme tokens as well as most cryptos, retail investors could wonder whether now is a good time to invest in Floki Inu. Let’s take a look.
Floki Inu is Gaining Popularity
Created in June 2021, following Elon Musk’s tweet regarding his Shiba Inu puppy, FLOKI was “birthed by fans & members of the Shiba Inu community.” It is currently available on the Ethereum (CCC:ETH-USD) blockchain and Binance Coin (CCC:BNB-USD) Smart Chain. Moreover, FLOKI fans, so-called Floki Vikings, are signing a petition to have the token listed on Coinbase (NASDAQ:COIN).
According to its whitepaper, FLOKI claims to be more than just another meme stock. Positioning itself as a community-owned
revolutionist cryptocurrency,” and aiming to become one of the most-used cryptos, the token is working on three flagship utility projects: a non-fungible token (NFT) gaming metaverse called Valhalla, an NFT and merchandise marketplace called FlokiPlaces, and an educational platform called Floki Inuversity.
FLOKI has 10 trillion coins in total. Crypto fans note that this is a small quantity compared to the 1 quadrillion total of SHIB. Moreover, as a result of the buyback and token burn system, a small percentage of Floki tokens are permanently removed from circulation with every transaction via the burn wallets on Ethereum and Binance. As the token supply declines, the token price is expected to increase accordingly.
Shortly after its launch, Floki Inu made its first non-utility-based partnership with community gardening charity Million Gardens Movement, which belongs to Elon Musk’s brother Kimbal Musk. Other strategic partnerships with the crypto e-commerce marketplace CryptoCart and Shopping.io (CCC:SPI-USD) opened the e-commerce doors. As a result, customers can now use their FLOKI tokens to purchase products from Amazon (NASDAQ:AMZN), Apple (NASDAQ:AAPL), eBay (NASDAQ:EBAY), Etsy (NASDAQ:ETSY), Home Depot (NYSE:HD) and Walmart (NYSE:WMT), among others.
However, these partnerships and projects were not the necessarily behind the run-up in the Floki Inu price. Rather the market has been mainly influenced by the hype surrounding Elon Musk’s tweets and general interest in meme coins.
The Bottom Line on Floki Inu
In order to keep the current positive momentum going, Floki team has launched an aggressive marketing campaign throughout Europe. The aim is more recognition and having influencers join the bandwagon. The campaign is anticipated to cost around $1.5 billion. The London leg focuses on the city’s public transport and uses the slogan “Missed Doge? Get Floki.”
Another tweet announced a large-scale U.S. campaign as well. It is expected to run through the end of the year. In addition to recent promotional operations, the market heard the news that an anonymous Binance Smart Chain (BSC) whale acquired eight billion FLOKI tokens, worth around $3.6 million.
Despite attractive gains and increased popularity of altcoins, interested readers should be cautious with the hype-based rallies and possible pump-and dump schemes that are part of the crypto space in general. Although Floki Inu could still create utility and become a long-term name, it is important to remember that of the thousands of digital coins, only a handful are expected to stay around in the long-run.
According to Cryptorank, FLOKI-USD has a volatility ratio of over 93%, ranking it among the highest 200 cryptocurrencies in a universe of over 12,000 cryptos. Thus, if you decide to buy the crypto, make sure you can handle stomach-churning daily swings.
Meme coins have been soaring on hype-rallies as well as the fear of missing out (FOMO). So far, FLOKI, hasn’t done much other than being a meme coin. In other words it has been named after a billionaire’s dog, playing to investors’ emotions (i.e., fear and greed), and pouring pots of money for marketing campaigns.
It still has to a long journey to prove itself as a reliable investment option. Therefore, interested crypto fans should realize that they could lose a significant portion of their investments in such meme coins.
On the date of publication, Tezcan Gecgil did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Tezcan Gecgil, Ph.D., has worked in investment management for over two decades in the U.S. and U.K. In addition to formal higher education in the field, she has also completed all three levels of the Chartered Market Technician (CMT) examination. Her passion is for options trading based on technical analysis of fundamentally strong companies. She especially enjoys setting up weekly covered calls for income generation.