It’s not just Bitcoin (BTC-USD) that has rallied this year. The entire cryptocurrency sector has been buoyant, including meme coins, which are cryptocurrencies based on popular internet memes. Unlike other crypto, such as BTC and Ethereum (ETH-USD), meme coins serve no practical function or purpose. While the market has cooled off some, market data shows that trading in meme coins such as Shiba Inu (SHIB-USD) rose 61% in February as more than $6.4 billion worth of the digital assets changed hands.
The rally in meme coins has coincided with the price of Bitcoin hitting an all-time high of just under $74,000 in mid-March. At the same time, venture capital fundraising for various cryptocurrency projects and investments grew by more than 50% in March of this year as digital asset prices rallied and the entire crypto market rose. However, there are signs that sentiment is shifting. Inflows to new spot Bitcoin exchange-traded funds (ETFs) have slowed, prices for various digital assets have softened, and a growing number of hedge funds are betting that Bitcoin’s price will continue to slump in coming weeks.
Here is market meltdown: three meme coins to dump before they collapse.
Dogecoin (DOGE)
The price of Dogecoin (DOGE-USD) has been on a tear this year, having gained 119% since the start of January. Over the last 12 months, the price of DOGE has risen nearly 150% as investor speculation in meme coins has been reignited. The popular dog themed meme coin has also risen more than 20% in recent weeks on news that cryptocurrency exchange Coinbase (NASDAQ:COIN) now offers DOGE futures. Coinbase, which is one of the biggest crypto exchanges in the world, said in a regulatory filing that Dogecoin is beyond a “joke” in the current investing environment and a legitimate cryptocurrency.
“Dogecoin’s enduring popularity and the active community support suggest that it has transcended its origins as a meme to become a staple of the cryptocurrency world,” said Coinbase in a written statement. Some investors have speculated on social media that the listing on Coinbase could pave the way for an eventual spot Dogecoin exchange-traded fund (ETF), similar to Bitcoin. Dogecoin features the image of a cartoon dog and its creator says he launched the cryptocurrency as a joke back in 2013. Since then, the meme coin has taken on a life of its own.
Pepecoin (PEPE)
If there’s one meme coin that has outperformed all others amid the current rally it is Pepecoin (PEPE-USD). The meme coin that features the image of a cartoon frog has risen 10,250% in the last 12 months to currently trade at $6.12 per digital token. Pepecoin’s price has increased nearly 1,000% since January of this year when it started off 2024 trading at just 64 cents. The gains in PEPE have blown past all other meme coins, and any asset class for that matter.
Pepecoin has seen its trading volumes spike above $3.50 billion in a single day this year as investor speculation intensifies. The rise in Pepecoin is being driven by individual investors who are placing larger bets on riskier assets such as meme coins. Pepecoin is now among the largest meme coins with a market capitalization of nearly $820 million. While the rise in PEPE might seem surprising to some, it comes as investors embrace meme coins of all stripes.
Bonk (BONK)
While its gains haven’t been as impressive as Pepecoin, meme token Bonk (BONK-USD), which is also a dog-themed image, has seen its price rise 4,270% in the past 12 months amid a broader rally in meme assets. Bonk is one of the newer meme coins having only launched in December 2022. But it has been a strong performer since the current crypto rally began in earnest last year. Despite its big rally though, BONK currently trades at a fraction of one cent.
The rally in BONK really took off last fall on news that it too would be listed on several crypto exchanges, including Coinbase and Crypto.com. While some analysts dismiss Bonk as a knock-off of legitimate cryptocurrency Solana (SOL-USD), the meme coin’s trading volume spiked above $1 billion a day last December, making it one of the most widely traded cryptocurrencies. Most analysts agree that Bonk’s growth is due, in part, to a resurgence of interest in the cryptocurrency Solana on which it is based.
On the date of publication, Joel Baglole 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.
