Cryptocurrency fields grow daily and at a fast pace. Alongside established giants like Bitcoin and Ethereum (ethusdt), a new breed of digital assets has emerged: for instance, Dogecoin (doge usdt) and Shiba Inu. These meme coins are normally decentralized cryptocurrencies that were developed as a joke and mostly reflect culture, the community gets interested in the trends meant for day traders, and confusing to those who have been in the game for a long time.

In today’s article, we will be discussing the trends, communities, and investment considerations associated with meme coins.

What is the most popular memecoin?

Meme coin’s popularity has risen sharply, such coins as it is well-known have created real competitors. Some of the most popular meme coins include:

Dogecoin (DOGE): Mined or introduced as a lighthearted counterfeit of Bitcoin, Doge has started to get huge popularity because of its loving community and cheerful face.

Shiba Inu (SHIB): Initially, Dogecoin had succeeded and then the idea of Shiba Inu was conceived and it too adopted a similar Shiba Inu dog as the meme coin. The Dex attracted attention for its community approach and the creation of a self-contained environment for tokens such as LEASH and BONE.

Safemoon (SAFEMOON): Safemoon is worth mentioning as it has unique tokenomics. a static reflection mechanism and a pool of liquidity. It discourages the early selling of stocks by the sellers by making them pay a penalty.

DogeFather (DOGEFATHER): One of the meme coins DOGEFATHER has its motto on Dogecoin. It came back by tying on the popularity of the previous series.

This popularity has been built based on the market cap size, media exposure, and community support.

Trends Under the Shed of the Meme Coin Boom

Here are a few trends:

Social media hype

Owing to the virality of platforms like Twitter and Reddit, the influence of people on it can’t be underestimated. A memorable name, an amusing meme portraying an adorable canine or grumpy cat like those Doge Coin and Graceful Catcoin are respectively, or a sign of a celebrity with a huge social media following like revolutionary words of Elon’s tweeting on Dogecoin can bring up a meme coin’s popularity. The pace at which information spreads in cyberspace can propagate an information effect that a single positive comment can lead to a buying frenzy and it snowballs into a large market share.

Retail investor enthusiasm

Many of the meme coins have a low bar for entry against the crypto-cryptocurrencies with an established presence in the market, which is bound to attract those new to investing in crypto in the bid to own some of the crypto-pie. This, among other things, like meme coins trading on popular meme-friendly exchanges leads to a further increase of enthusiasm towards them. For numerous fresh investors, meme coins are seen as a low-risk initial investment that would allow them to buy a little piece of a mysterious, but promising cryptocurrency market. Furthermore, the belief of being the next millionaire through only a small initial investment is an opportunity not to be missed.

The “fear of missing out” (FOMO) effect

People get a feeling of being left out when a meme coin gets a price boost through social media craze or celebrity engagement. Most of them would then buy the meme coin, only to make its value get pumped further. Consequently, such a process gives rise to a self-regulation mechanism, as the increasing number of market participants brings more money to the market and the price goes up.

Market manipulation

In several examples, social media cooperation can turn out to be the reason for the issue of demand whereas the large stocks jumping over the price bar can create a frenzy. This can entail using several accounts to present bullish sentiments or running bots for conducting very fast trading transactions that show the public that there is a high trading volume. Therefore, you must guard yourself against these ​​​​deliberate strategies of disinformation and conduct due diligence before making any investments in a new coin.

Meme Coin Communities: A Dual Nature

The meme coin communities or the community power of this particular asset class can be labeled as special traits. These virtual clans typically straight up on Telegram and Discord, are great at building a sense of companionship and common goals. They are well-known as cradles for memes, and sets of marketing schemes, and can impact the price drastically with a united action.

But alongside the positives, the respective predetermined types of these communities can also prove a weakness. They tend to attract like-minded individuals, resulting in “echo chambers” that reinforce the positive sentiment and discourage any critical inquiry. Moreover, their passion for this business is not always rational enough to comprehend rational reasons, and this is why sometimes customers can make impulsive moves and wrong investment decisions.

Investing in Meme Coins: A Risk Calculated

Investing in a meme coin gives you the opportunity for quick profits, but the risk is very high. Here are some key considerations for investors:

Volatility

As far as the meme coins go, these are known to be rash in movements also reacting wildly to the balloons sums and hype-being, not the fundamentals.

Limited usability

Unlike some stable cryptocurrencies, meme coins possess few practical uses outside of the market, making their future entrance and stable value questionable.

The rug pull risk

The worst thing that can happen is that a creator can run away with the money after hyping up the price, leaving investors with nothing. Such a creator will be described as a ‘Rug puller.’

Conducting Due Diligence Before Investing

Meme coin investing is also both time-consuming and research-intensive. Here are some essential steps to take:

Dive into the coin’s origin story: That requires us to figure out the one most influential coin maker who would take the primary responsibility for the drive. What is the problem that comforts people to work on it?

Evaluate the community sentiment: Is the community friendly and informative or otherwise, is it accompanied by some pretty big red flag such as the automatic manipulation of unprovoked positive attributes peeking from all the corners or the lack of interest in the criticism?

Assess the tokenomics: What number of coins are, then, we sure of having at the present? This expenditure is referred to as the “seigniorage,” which means what the mint mints (the minting process). However, there is a question that the world ought to ask itself – would the creators face difficulties in controlling them or it may be a case of the creators (ownership) inflating the total supply?

Consider Alternatives

Potential cryptocurrency investors who want to gain exposure to the market may consider mature projects whose mining is well-used cases and have demonstrated records for their community-driven developments like Bitcoin (btc usdt) and Ethereum (ethusdt). On the other hand, a company like Toobit offers a diverse range of futures contracts such as SEI USDT (sei usdt) which are more connected to the underlying market movement rather than the unnecessary volatility caused by a meme coin.

Conclusion

Meme coins are an eye-catching phenomenon that may be accidentally fueled by social media channels, ardent communities, and by rumors which are many. They may give you an enormous profit, but they can, also, lead you to suffer massive losses. Speaking to investors, they should thoroughly screen for potential meme coins. Having an understanding of the market and the potential volatility can help one join the meme coins culture. 

The meme coin market is very high-risk and unpredictable. As an alternative to cryptocurrency exposure, mature projects such as Bitcoin or Ethereum, or investing in older coins, are more advisable. On Toobit, there is a wide selection of futures contracts such as SEI USDT that allows for synchronized market moves without the unwanted volatility you can get otherwise as a result of meme coins.