Opinion: Unveiling the 2024 pre-halving bull run – An exploration of the numerical frenzy behind Memecoin phenomenon
Disclaimer: The opinions expressed in this article are solely those of the author and do not represent the views and opinions of crypto.news’ editorial team.
In a remarkable turn of events, memecoins are once again leading the charge in the crypto market, experiencing unprecedented growth. While some critics argue that meme tokens lack value and are detrimental to the industry, others commend them for their ability to engage communities and attract new users to the world of crypto. Additionally, the recent memecoin boom has resulted in a surge in transaction volume in web3 wallets, reshaping the landscape of crypto storage.
Regardless of one’s opinion on the value of memecoins, their current influence on the crypto market cannot be underestimated.
The rise of meme tokens signifies the emergence of a new bull run. By the end of March 2024, the market capitalization of top meme coins had reached $80 billion, approaching the all-time highs seen during the previous rally in 2021. As of now, the total value has corrected to nearly $55 billion.
Leading the pack in terms of market capitalization are Dogecoin and Shiba Inu, both well-known from previous alt seasons. However, new leaders have also emerged, such as BONK, known as “The Dog Coin of the People,” and Book of Meme (BOME), a Solana-based token that experienced a staggering 457-fold increase since its listing on Binance on March 16, only to later plummet by 50%. Another contender in the race is Dogwifhat (WIF), also based on Solana, which has seen a 22-fold increase in value since January. Its supporters even managed to raise 690,000 USDC to showcase the project’s mascot at Sphere in Las Vegas.
Analysts have noted that the current meme rally differs from previous market cycles in a peculiar way. Liquidity has shifted directly from Bitcoin to memecoins, bypassing intermediate steps like Ethereum and other high-cap coins. This deviation from the norm has caught the attention of industry experts.
The market capitalization of memecoins has already reached levels comparable to the all-time highs of 2021. However, this may just be the beginning of the rally, as the Bitcoin halving is yet to occur. Typically, market peaks occur within a year after this event, indicating that there may be further growth to come.
The surge in memecoin popularity has also resulted in a significant increase in transaction volume in web3 wallets. Among the top five web3 wallets, one has experienced an 18% growth in weekly active users, while two others have seen a nearly 50% increase. What is particularly noteworthy is the transaction count, with two wallets surpassing MetaMask, one of the most widely used web3 wallets in previous market cycles. Bitget Wallet, a solution developed by crypto exchange Bitget, has emerged as a leader in this space. The wallet recently listed trading pairs with BOME and BONK, possibly contributing to the surge in transaction volume.
The dynamics of the web3 landscape have changed in recent months and weeks, with MetaMask’s percentage of transactions processed dropping from 100% to nearly 19%, making room for new players.
Opinions on memecoins within the market are polarized. Franklin Templeton, a trillion-dollar asset management firm, argues that meme coins appeal to traders due to low fees and the potential for quick profits, but warns that they lack inherent value or utility and harm the crypto industry. Ki Joung Ju, the founder and CEO of blockchain analytics firm CryptoQuant, shares this sentiment. On the other hand, crypto entrepreneur Arthur Hayes emphasizes the importance of not dismissing memecoins as “stupid and valueless,” as they have the potential to attract new users and developers to blockchain ecosystems. Maartje Bus, VP of research at Messari, believes that memecoins will remain a vital part of the crypto industry and may even evolve into a new asset class. She highlights their role in introducing newcomers to web3 basics and fostering a sense of community in the blockchain space.
As with many crypto phenomena, memecoins have the potential to evolve beyond their current state and serve a greater purpose. Vitalik Buterin suggests that meme tokens can be used as tools for funding public projects, contributing positively to society.
Whatever the future holds for memecoins, they are undoubtedly reshaping the market at present. In the current market phase, meme tokens are driving up the value of L1 chain coins like Ethereum and Solana, and redefining the web3 wallet leaderboard. The upcoming rally will likely bring further changes that memecoins will introduce to the crypto market.
Read more: From Hollywood to HODL: how celebrity adoption is catalyzing the growth of memecoins
