Definition and Essence of MEME Coin

MEME Coin, or meme coin, is a type of cryptocurrency created based on the phenomenon of internet meme culture. In the internet context, memes refer to cultural elements that spread rapidly among online user groups through imitation and replication, encompassing funny images, jokes, short videos, and more. MEME Coins incorporate these highly viral meme elements into currency design, using them as the core driving force for value conveyance and propagation, making the currency itself a new carrier of internet cultural dissemination. For example, Dogecoin (DOGE) adopted the image of a cute Shiba Inu dog as its logo. This image already had high virality and likability on the internet. When cleverly incorporated into Dogecoin, it quickly attracted a large number of users, becoming Dogecoin’s unique cultural symbol and propagation icon.

Image source:https://coingape.com/markets/4-dogecoin-rival-meme-coins-to-buy-for-100000-profit-in-may/

Compared to traditional cryptocurrencies like Bitcoin and Ethereum, MEME Coins show obvious differences in many aspects. From a technological innovation perspective, Bitcoin pioneered the decentralized electronic cash system, and its blockchain technology provided the foundation for secure, anonymous peer-to-peer transactions. Ethereum, on the other hand, built a platform for developing decentralized applications (DApps) through smart contract technology. However, most MEME Coins are not technology-driven; they are usually created based on existing mature blockchain platforms such as Ethereum, Binance Smart Chain, etc. In terms of application scenarios, traditional cryptocurrencies have relatively clear uses: Bitcoin for value storage and cross-border payments, Ethereum for executing smart contracts and decentralized finance (DeFi) applications. In contrast, MEME Coins usually have vague application scenarios, relying more on community consensus and market speculation, lacking substantial commercial application support. For instance, Shiba Inu Coin (SHIB) mainly derives its value from price fluctuations in the trading market rather than applications like actual goods or service payments.

Origin and Development of MEME Coin

(1) Dogecoin: The pioneer of MEME Coin

The origin of MEME Coin can be traced back to the birth of Dogecoin (DOGE) in 2013. Software engineers Billy Markus and Jackson Palmer created Dogecoin with the intention of adding a touch of lightness and humor to the serious cryptocurrency market. Taking Bitcoin as a technical blueprint, they chose the widely circulated Shiba Inu ‘Doge’ meme as their logo, incorporating its unique humor culture. Dogecoin initially circulated in niche circles on the internet, used for online tipping, small transactions, and other scenarios. However, with the active promotion of the loyal user community known as the ‘Dogecoin Army,’ it gradually spread through social media, cryptocurrency forums, and other channels, entering the mainstream view. In the early days, Dogecoin’s price remained low and trading volume was small, but as the community’s influence expanded, especially with attention and promotion from celebrities like Tesla CEO Elon Musk on social media, Dogecoin’s price began to fluctuate significantly, and its market value quickly rose, becoming an undeniable force in the cryptocurrency market, laying the foundation for the emergence of various MEME Coins.

Image source:https://x.com/dogecoin

(2) Important stages and representative coins in the development process

After Dogecoin, MEME Coin ushered in a period of rapid development. 2021 is an important node in the development of MEME Coin, and this year Shiba Inu (SHIB) has sprung up. With the goal of challenging Dogecoin’s position in the MEME Coin space, Shiba Inu has similarly adopted the Shiba Inu image as its logo, attracting a large number of investors through a well-planned community marketing campaign. In just a few months, Shiba Inu’s market cap has grown phenomenally, making it the top cryptocurrency by market capitalization. For example, in May 2021, the price of Shiba Inu skyrocketed, with a market capitalization of more than billions of dollars, and the number of its community members also exploded. In the same year, PEPE (Sad Frog Coin) was also successfully launched with the help of the popular “Pepe the Frog” meme on the Internet and achieved significant market value growth driven by specific communities.

Image source:https://www.pepe.vip/

In January 2025, the newly elected US President Trump launched a MEME Coin called ‘TRUMP’, which saw a significant price fluctuation shortly after its listing, with a peak increase of over 15000%. This sparked widespread attention from the cryptocurrency market and the public, once again bringing MEME Coin to the center of public opinion. These representative coins at different stages continue to enrich the ecosystem of MEME Coin, driving its growing influence in the cryptocurrency market.

TRUMP spot trading address on Gate:https://www.gate.io/trade/TRUMP_USDT

Analysis of MEME Coin Characteristics

(1) Low Market Capitalization and Low-Cost Investment Characteristics

MEME Coin generally has the characteristic of low market value. Compared to mainstream cryptocurrencies such as Bitcoin and Ethereum, which have market values of tens of billions of dollars, many MEME Coins have market values in the initial stage or development process only in the range of several million or even tens of thousands of dollars. This low market value makes them more easily affected by capital leverage in the market, resulting in larger price fluctuations. For example, some newly launched MEME Coins may experience a substantial price increase in a short period of time with only a small amount of concentrated buying. At the same time, the transaction costs of MEME Coins are relatively low, and the threshold for trading is low, allowing ordinary investors to participate in purchasing and trading with less capital. This enables investors with limited funds to participate in the cryptocurrency market, reducing the capital threshold for investing in cryptocurrencies and attracting a large number of retail investors. For example, investors may only need to spend a few dollars or even a few cents to purchase a certain amount of certain MEME Coins.

(2) Strong Community-Driven Nature and High Virality

Community-driven is the core driving force behind the development of MEME Coin. The community members of MEME Coin are not only investors but also active promoters and builders of the project. The community continuously strengthens the consensus on MEME Coin by creating interesting content, organizing online and offline activities, and promoting on social media. For example, the Dogecoin community often holds various online creative competitions, encouraging members to create interesting images, videos, and other content related to Dogecoin, which are widely spread through social media to attract more attention to Dogecoin. At the same time, MEME Coin leverages the viral nature of internet memes to spread easily on social media, cryptocurrency forums, and other platforms. An interesting concept, image, or marketing campaign can quickly spread globally through user sharing and discussion. For example, based on the popular sad frog meme on the internet, PEPE Coin, driven by a specific community, attracted a large number of new investors’ attention and participation through widespread dissemination on social media, achieving rapid market value growth in a short period. Once the community’s enthusiasm for a particular MEME Coin wanes, or if there is division or negative events within the community, its price may sharply decline, demonstrating the double-edged sword effect of community-driven initiatives.

(3) Large Price Fluctuations and High Speculativeness

MEME Coins experience extremely large price volatility, and their price trends are often difficult to explain and predict using traditional financial theories and market analysis methods. Taking Dogecoin as an example, throughout its development, its price has doubled or halved multiple times within short periods. Such dramatic fluctuations bring the possibility of high returns but also come with significant investment risks. MEME Coin prices are influenced by market sentiment, social media buzz, celebrity effects, and more. Investor psychology and behavior play critical roles in these price fluctuations. For example, when a well-known figure posts a positive comment about a MEME Coin on social media, it can trigger a buying frenzy among investors, quickly pushing the price upward; conversely, negative news can lead to rapid sell-offs and price crashes. Due to their large price volatility and lack of substantial value support, MEME Coins possess high speculativeness, attracting a large number of speculators seeking short-term high returns. These speculators frequently buy and sell in the market, further exacerbating price volatility.

Risk Warning

MEME Coin is different from traditional cryptocurrencies such as Bitcoin and Ethereum, the latter of which have certain technological innovations and application scenarios as value support. Bitcoin aims to achieve a decentralized electronic cash system, solving trust and security issues in traditional currency transactions through blockchain technology; Ethereum provides a platform for applications such as smart contracts, promoting the development of decentralized finance and other fields. However, most MEME Coins lack substantial application value, and their value is mainly based on community consensus and market speculation. Taking some MEME Coins based solely on a popular internet meme as an example, they lack a clear business model, sources of profit, or technological breakthroughs. Once the market hype fades and community consensus collapses, they are likely to become worthless, leaving investors facing significant losses. For example, some MEME Coins launched during a specific internet trend rapidly plummet in price once the trend passes, leaving many investors empty-handed. This lack of actual value support makes MEME Coins face a higher risk of going to zero in market fluctuations.

Additionally, due to the small market value, large price fluctuations, and relatively irregular trading of MEME Coin, it is easy to become a target of market manipulation. Some large investors or project teams may take advantage of concentrated funds to buy or sell large amounts of MEME Coin in the short term, manipulate price trends, create false market prosperity or panic to attract other investors to follow suit, and thus achieve their own profit goals. For example, some project parties may sell a large amount of tokens held in the early stages of the project, exit after making huge profits, causing a sharp drop in prices, and causing ordinary investors to suffer losses. In addition, some criminals may also use MEME Coin for fraudulent activities, such as false advertising, pyramid schemes, etc. They attract investors to participate by exaggerating project prospects, promising high returns, etc., but actually deceive investors’ funds. In some MEME Coin projects, there are cases of project parties fabricating project backgrounds, forging technical strength, etc., further increasing market risks. Such market manipulation and fraud risks seriously harm the interests of investors, disrupt market order, and investors need to be vigilant against risks.