A derivative of something weak that is a derivative of something that is also weak can be great can’t it? That’s what Floki Inu (CCC:FLOKI-USD)) fans want you to believe.
But Floki Inu isn’t great. It’s simply a trader’s tool. It’ll attempt to build use cases in order to justify a legitimate future. Don’t be fooled by that. That is the lineage of Floki Inu. What do I mean by that?
I began by referring to Floki Inu as a weak derivative of a weak derivative. It was created out of Shiba Inu’s (CCC:SHIB-USD) meteoric rise.
But Shiba Inu is hardly strong. I’d characterize it as another attempt to fool investors into believing that the project will create real utility after gaining fame unpredictably.
That’s the pattern. Shiba Inu was created on the coattails of Dogecoin (CCC:DOGE-USD), which arose out of meme fame. It doesn’t have any real utility either. Floki Inu simply followed suit. The whole dog-inspired coin t can be aptly characterized as a strange phenomenon.
Anyway, the point I’m attempting to make is simple: Dogecoin led to Shiba Inu, which in turn led to Floki Inu. Each caught on and made some individuals serious amounts of money. Traders profited. But each meme coin is now trying to convince followers that they are to be taken seriously.
In the case of Floki Inu that is being done through philanthropy.
The team behind Floki Inu recently announced that it is building a total of three schools in Nigeria, Guatemala, and Laos.
The schools are being built through partnerships with the Tabitha Cumi Foundation and Pencils of Promise according to the article. Those particular organizations have helped build hundreds of schools over their existence.
It’s certainly a commendable effort, and Floki Inu should be lauded for it. However, it also does little to answer the pressing issue of utility. Since my issue with Floki Inu is utility, I’ll take a bit of a cynic’s view here in regard to the school construction and simply note it doesn’t improve utility. I hope the schools help students, but that is irrelevant to utility.
To be clear here, I’m not saying that Floki Inu has intentionally scammed any users. Rather, I just think the premise behind it has little of value. If it builds any significant utility, it will be a minor miracle.
However, scammers are using Floki Inu’s fame to scam investors. SnowFlake Floki, a Floki Inu knockoff, has recently been identified as a honeypot scam. A honeypot scam is one in which purchasers cannot sell their coins.
That kind of activity isn’t exactly new. Investors likely heard of a similar story in relation to Netflix (NASDAQ:NFLX) hit Squid Game. While it may not be new, it does highlight the danger in investing in the next meme coin derivative.
Anyway, let’s get back to why Floki Inu makes little sense.
The premise of Floki Inu is based around memes. In fact, memes are one of the three pillars of the project: “Our community loves and lives for the memes, and we strongly believe that the only way to truly take cryptocurrency mainstream and ensure mainstream adoption is by leveraging the power of memes.”
I truly believe that meme coins aren’t worthwhile. Again, they can be a great traders tool, but little more. The other pillars include utility. Again, I don’t believe there is much there outside of vague promises.
The third pillar is charitability. The school building example lends some credibility to this at least.
What to Do
I’ve never been a fan of Floki Inu or any dog-inspired coin. Building utility in the world of crypto is difficult. It must be done first. It is the number one success factor. Meme fame can’t determine ultimate success.
On the date of publication, Alex Sirois 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.
Alex Sirois is a freelance contributor to InvestorPlace whose personal stock investing style is focused on long-term, buy-and-hold, wealth-building stock picks. Having worked in several industries from e-commerce to translation to education and utilizing his MBA from George Washington University, he brings a diverse set of skills through which he filters his writing.