Dogecoin & Other Memecoins: How Jokes Became Top Dogs
While having declined from its record peak price in May, as at time of writing, Dogecoin remains at the top of the pile, as the eighth most valuable cryptocurrency in the world, and recognizably one of the most popular.
Standing at the helm of what is one of the largest waves of crypto adoption to be seen in a long time, memecoins continue to hold an undeniable appeal.
It makes one wonder, when did the first meme tokens come around and what exactly makes them so attractive?
Dogecoin: a Brief History
Way before the first memecoin, Dogecoin, was conceived, Bitcoin had been around. Bitcoin, the first and still leading cryptocurrency, was created in 2008.
Bitcoin’s ascent to adoption, although slow, was pretty steady, and by 2011, when Bitcoin first crossed over $1000 per coin, a lot of imitations began to spring up. Several developers started to create something similar hoping to encounter the same kind of success. This marked the beginning of alternative coins, generally known as altcoins. The coins were accepted to be copies of Bitcoin with no notable difference besides a change of name and logo in the hopes of drawing in investors looking to make easy profits. Of course the meaning of “altcoins” have since evolved, with many coins other than Bitcoin offering equally brilliant projects.
IBM software developers, Jackson Palmer and Billy Markus, saw the rage of clone coins populating the crypto market, and thought it was funny. They decided then to create a coin of theirs, too. However, instead of being all serious, and salesy, and branding themselves to attract top investors, they decided to do the complete opposite: call themselves a joke.
"The original intent was a parody of all the 'serious' [Bitcoin] clone coins that were trying so hard to differentiate themselves, but all seemed the same," – Dogecoin co-founder, Billy Markus, told Business Insider in April 2021. "Dogecoin was just another clone coin, but instead of taking itself seriously, it was just Dogecoin."
Palmer and Markus created and released Dogecoin in December 2013.
At the time, one of the most famous memes in the history of the internet was at the peak of its fame: a curious picture of a Shiba Inu dog named Kabosu adopted by a teacher from Japan whose blog gave rise to a host of memes. The general theme of most memes was a cute picture of Kabosu accompanied by bright neon text in Comic Sans font written in deliberately nonsensical English as some sort of internal “dog” monologue. The catchphrases were impossible as they were catchy, with words like “much wow” and “such amaze” floating about the internet.
The viral memes became the logo for the ultimate Bitcoin parody: Dogecoin.
After DOGE was released, crypto enthusiasts began trading the currency for fractions of a penny, with the first Dogecoin ever to be traded at 0.001540753 USD per coin in early 2014.
Fast forward a few years, and here we have DOGE recording an ATH of $0.73 per coin. Dogecoin has developed a massive online support base of its own, even often serving as the first cryptocurrency multiple market newbies have come in contact with.
Why Are Memecoins So Popular?
First, what is most obvious about Dogecoin and other memecoins popularity is their entertainment value: they are easy to laugh about, to share, a perfect stress relief for an industry that can be straining.
However, aside from this obvious reason, meme tokens are popular for a bunch of other reasons.
Alongside NFTs, which were all the rage in the early months of 2021, memecoins just might be one of the greatest contributors towards mainstream adoption for the crypto industry generally.
DOGE reached its first major all-time high in April, 2021, a few days to the 20th which has been set aside as “Dogecoin Day”. Quite different from the bantering Bitcoin Pizza Day, Dogecoin Day called for massive support and involvement from members of the token's community. Dubbed the Dogecoin Army on social media, DOGE devotees were tasked with making preparations for the first stages of a bull run. This again outlines the biggest strengths of Dogecoin and other memecoins: community.
Memecoins are often driven by large, committed communities, on popular media like Twitter and Reddit, who push price movements and engagements as much as possible. However, before the communities, before the rave, what made memecoins attractive enough, famous enough? Here are four other major reasons why memecoins have become very famous.
#1 Who Doesn’t Love the Underdog?
More than a play of words, DOGE became the top dog by being exactly the opposite of what other coins claimed to be: the next big thing.
Dogecoin, like other memecoins it has inspired, does not claim to be the next groundbreaking innovation, or the next coin capable of flippening Bitcoin or anything at all. It does not claim what it is not. It is just dogecoin: a joke.
Dogecoin has managed to outperform many cryptocurrencies by not taking itself seriously. In a space of profits and losses and tension, Dogecoin and other memecoins thrive by making light of these issues, thus connecting with even more audiences less receptive to the crypto industry. Everyone loves jokes. Everyone loves a laugh, and who’s to say you can’t have fun while you invest?
#2 Anyone Can Afford Them
Meme coins are super cheap: compared to other more serious currencies, their prices are considerably lower – they're almost laughable to a newbie. This is yet another reason why they are popular among beginners. In contrast, Bitcoin trades at about $44, 626 at press time. The second-biggest cryptocurrency Ethereum is priced at $3,224 per coin. Dogecoin, on the other hand, trades at 23 cents despite thousands of percentage increase over the years, while one SHIB coin only costs a small fraction of this.
The reason DOGE trading is on the rise extends beyond the coin's fun nature and its huge community. Its easy access and cheap prices play a pivotal role in piquing interest. Simply acquiring one or two Dogecoins is enough to make you a Doge trader: an encouraging perk for people who are new to the market as it helps them get acquainted with the crypto industry and test out risky trading strategies with little at stake.
#3 Reverse psychology
Reverse psychology works on the principle that if you want people to do certain things, you suggest otherwise. Human beings are complex creatures who relish giving orders rather than following ones. Reverse psychology works because no one likes being ordered around. This is also quite evident in the way a lot of new traders band up to hike up prices of meme stocks and memecoins: they have a say, for the first time they can influence the market.
After the release of their product in December 2013, the founders of Dogecoin did all they could to make the coin as unappealing as possible.
The first step was making sure there was an infinite supply of Dogecoins in circulation, an obvious step in the opposite direction of BTC, which is quite deflationary. Dogecoin developers hoped to discourage people who wanted to store the coin.
After that, they introduced the Lucky pool consensus mechanism, which randomly gave miners rewards and was created to drive down mining participation in the Dogecoin network. Regardless of its distraction tactics, DOGE has thrived and survived, and non-deflationary coins with no empty promises that have since sprung up have also been successful.
#4 Celebrity Influence
Celebrities have undeniably played the biggest role in contributing to the success of meme tokens. For Dogecoin, Tesla founder Elon Musk has been a pivotal influencer. Before Musk's public endorsement and influential support, Dogecoin’s marketcap was about $15 million. Barely a year after Musk took to DOGE, the coin spiked up by over 2500%.
The billionaire’s influence on the coin is termed “The Musk effect,” and it is nearly impossible to research Dogecoin without running into the name of the Tesla and SpaceX founder.
Musk is not the only one who has influenced DOGE with cryptic tweets like “barking to the moon!”; celebs like Snoop Dog and Mark Cuban have also jumped on the train in the past, introducing the coin to newer audiences.
There is the video of popular rapper Snoop Dogg , who referenced himself at the helm of a spaceship alongside a Shiba Inu dog draped in purple. Humorously named Snoop Doge, together they leave earth on a quest for the domination of another planet.
Hey thanks @elonmusk for the space ship. 🚀 Happy 420. 🎥 cred: @Jessewelle @SamMacaroni pic.twitter.com/bzxvYwaR4a
— Snoop Dogg (@SnoopDogg) April 21, 2021
Do Memecoins Have Any Caveats?
While meme coins offer a lot of positivity to the crypto market and are also brilliant tools for driving crypto adoption, they come with their own flaws.
Lack Of Innovation
Without any substantial utility, memecoins simply remain a way to make a quick buck and have little future guarantee. Unlike Bitcoin and Ethereum, they do not aim to solve any real-world issues.
Association With Scams
A lot of memecoin users aren't very familiar with the crypto industry and are simply out to make some money (and fast, too). Their lack of knowledge makes them easy prey for pump and dump schemes.
Celebrities Hold A Bit Too Much Sway
This is hardly in tune with the one of the core ideals of cryptocurrencies, which is decentralization.
A celebrity like Elon Musk having such massive influence doesn’t bode well for a cryptocurrency. Aside from this, while celebrity influence can sometimes lead to positive results, it can just as easily go sideways, as seen with Dogecoin’s decline after Musk’s SNL appearance. Or with SHIB, after Vitalik Buterin dumped his store of the meme coin causing it to lose more than half its price.
This is not to say memecoims do not have strong perks.
For one, they are a brilliant choice for day trading. The volatility of their prices makes them perfect for short-term traders. Knowing exactly how to use the constant fluctuation to one’s advantage could make a person quite some profit.
Memecoins can also be charitable. DOGE and HOGE has been used to tip a large number of people and has also been used in fundraising for charity. Shiba Inu (SHIB) tokens were also donated to an Indian Covid Relief foundation by Vitalik Buterin, the founder of Ethereum.
Popular Memecoins in Circulation
While Dogecoin is the leading memecoin worth 80 billion USD by market capitalization and standing as the 4th largest digital currency, there are lots of other humor-themed tokens out there, slowly making their way to the top. Here are some of them:
Also known as the Shiba token and sometimes the "Dogecoin Killer", this particular meme token was created as a parody of DOGE. It is an ERC-20 token and has a market cap of over $2.5 billion presently.
New to the game as it was created in March this year, Safemoon has grown in value so quickly as a result of the support it has received from various celebrities such as Logan Paul and Lil Yatchy. The meme coin currently has a market cap of over 2 billion US dollars.
Approved by Japan's Financial Service Agency, this token was created in 2013 as well. It is named after a meme based on a cat-like figure created using ASCII characters. It has a market cap of about $100 million and a maximum supply of 105 million.
HOGE is a token that combines the concept of memecoins and yield farming. For every transaction, a token burn is carried out and HOGE holders are rewarded with a share of the transaction.
Yet another coin with ties to dog-based memes, KISHU receives its name from the Japanese dog breed Kishu Inu. Kishu was released in early 2021, and thanks to endorsements from public figures such as rapper Young Thug, Kishu Inu has a market value of more than $69 million.
Other unlisted meme tokens include Pepe Cash, Dogelon Mars, Memecoin, CUMROCKET, and lots more.
While they aren't exactly a great choice of currencies to store for the future, memecoins are a great way to navigate the testy waters that make up the crypto economy. They are also a great introduction to the cryptocurrency industry. In an industry filled with thousands of coins and projects, meme coins have effectively created their niche and might stay around longer than we would think, even in newer versions we yet cannot imagine.
You can buy or trade any of your preferred tokens for DOGE or any other memecoins here on ChangeNOW without any registration.