"Memes and Money": Meme Coins

What are they?

Micah Shin - Senior Correspondent, USA

12.00AM, January 12, 2022

What are Meme Coins?

Meme coins cryptocurrencies that are based on memes and jokes found on the internet. You may have heard of coins like Dogecoin. Dogecoin, like Shiba Inu, Samoyedcoin, and MonaCoin, was created as a joke. The valuation of meme coins increases as more people purchase them, “buying-in” on the joke. Characteristics of meme coins include unlimited supply and low prices. These cryptocurrencies require minimal effort to create. An incentive for investing in meme coins is that anyone can purchase a large number of coins in a short period of time. For example, one Dogecoin is equivalent to 0.15 USD. Unsurprisingly, meme coins carry a considerable amount of risk. The value of a meme coin is incredibly volatile, as it relies on its relevance in online communities and erratic outside influences. In addition, there have been countless instances where people have created viral coins to scam others out of their money (see article Squid - The Catastrophic Fall of the Squid Game-inspired cryptocurrency). Nearly all meme coins are not built on a blockchain, and most have no value outside of the world of cryptocurrency. Lastly, meme coins are notorious for their association with pump and dump schemes. When members of r/WallStreetBets inflated Gamestop’s stock price, they also encouraged pumping up the value of Dogecoin.

Therefore, you should act with prudence and avoid investing in meme coins; in the end, their consequences outweigh the momentary hype.