Meme coins originate from the internet meme culture, representing a way to transform online trends and social media buzz into tangible investment assets. The first well-known meme coin, Dogecoin, was created in 2013 by two engineers as a joke. Unexpectedly, this lighthearted creation ignited what would later become a meme coin frenzy.

Thanks to viral social media exposure and celebrity endorsements, Dogecoin — originally intended as an internet joke — saw its price skyrocket. At its peak in 2021, Dogecoin’s market cap surged to approximately $80 billion. Following the meteoric rise of Dogecoin and other meme-based cryptocurrencies like Shiba Inu Coin, some investors began to view these assets as lucrative short-term trading opportunities.

Meme coin prices experience dramatic fluctuations within short periods (source: gate.io)

What is a Meme Coin?

A meme coin refers to a type of cryptocurrency created as a joke or inspired by popular internet memes. The term meme originally described cultural elements — such as viral images, videos, or catchphrases — that quickly gain widespread attention. By combining these viral elements with blockchain-based tokens, meme coins are born.

Unlike mainstream cryptocurrencies like Bitcoin, which are designed to address specific technological or financial challenges, meme coins typically lack practical applications or innovative technology. Instead, their value relies heavily on community consensus and trending topics. Due to this lack of intrinsic value, meme coins often experience far greater price volatility than traditional cryptocurrencies. Their prices can skyrocket or plummet rapidly, heavily influenced by social media trends, celebrity endorsements, or sudden shifts in market sentiment.

Furthermore, many meme coins intentionally adopt exaggerated token supplies to attract attention. This design often results in extremely low individual token prices — in some cases, just a few dollars can buy millions of tokens. While this low entry barrier attracts casual investors, it also fuels speculative excitement, as buyers imagine earning massive returns if the coin’s value spikes.

Market Trends and Impact of Meme Coins

The meme coin market has witnessed several waves of remarkable frenzy in recent years. One of the most notable instances occurred in 2021 when Dogecoin (DOGE) experienced a massive price surge, sparking a flood of dog-themed meme coins in the market. During this period, Dogecoin’s price skyrocketed nearly 100-fold. Meanwhile, Shiba Inu (SHIB) — dubbed the “Dogecoin killer” — achieved an even more astonishing rise. According to CoinGecko data, SHIB’s price was less than $0.0000000001 at launch in 2020, yet surged to over $0.00008 at its peak in 2021 — an extraordinary increase of several hundred thousand times.

Community-driven promotion, celebrity endorsements, and hype slogans like “100x coin” and “1000x coin” fueled investors’ FOMO (Fear of Missing Out) mindset, causing many to jump in at high prices. However, as the excitement faded, the vast majority of newly created meme coins during this Dogecoin boom eventually crashed to zero, with most projects disappearing entirely. Only a few major players like Dogecoin and Shiba Inu survived in the market.

Despite the cooling of the initial Dogecoin and Shiba Inu craze, the meme coin trend persisted. In April 2023, a new meme coin named Pepe Coin ($PEPE) — inspired by the iconic internet frog meme — skyrocketed in popularity. Within just a few weeks of its launch, its price soared dramatically. After a brief slump, PEPE surged again, reaching a market cap exceeding $10 billion by the end of 2024.

Pepe Coin’s Market Cap Volatility (Source: gate.io)

This pattern of meme coins rapidly gaining popularity and inflating valuations once again demonstrated the powerful impact of monetizing online attention. However, as with most meme coins, PEPE’s price plummeted soon after the initial craze. The situation worsened following reports that the development team had transferred significant funds, sparking concerns of an exit scam. Adding to the turbulence, PEPE’s official X (formerly Twitter) account was reportedly compromised by hackers in March 2025, further fueling doubts about the coin’s stability. This cycle of meteoric rise followed by sharp decline highlights the highly speculative nature of the meme coin market, contributing to significant volatility in the broader investment landscape.

Pepe’s Official X Account Hacked (Source: Pepe Official X Account)

The meme coin frenzy has had a dual impact on the cryptocurrency market. On one hand, it attracted a wave of young retail investors, boosting overall trading volume and media attention. According to CoinGecko data, billions of dollars are exchanged daily across various meme coins. Currently, Dogecoin remains the 9th largest cryptocurrency by market cap and boasts the second-largest user base after Bitcoin, keeping it firmly in the spotlight of mainstream media.

On the other hand, this excessive speculation has raised concerns among regulators. Some countries have imposed restrictions on meme coin trading. For instance, in early 2021, Thailand’s Securities and Exchange Commission (SEC) issued a ban on meme coin transactions.

In conclusion, the rise of meme coins has had a polarizing impact on the investment landscape — creating astonishing wealth and media buzz while also introducing heightened risk, extreme volatility, and potential fraud concerns.

Core Logic of Meme Coin Monetization

As a type of asset built on humor and viral marketing, meme coins are often born from trending topics on social media. Unlike cryptocurrencies that derive value from technological innovation, meme coins’ value stems from mass user engagement and speculative hype, making them highly sensitive to market sentiment and online trends.

The Meme Coin Lifecycle

The meme coin market typically exhibits clear cyclical behavior, driven by news, community sentiment, and online buzz. This cycle can generally be divided into the following key stages:

1. Hype Explosion Phase
   During this stage, viral memes, humorous videos, or celebrity tweets capture widespread attention, prompting large inflows of capital that drive meme coin prices upward. Although this period can seem highly attractive, the overheated market poses significant risks. Since price gains may have already peaked, this phase is often not ideal for new investors to chase rising prices.

2. Capital Inflow Phase
   At the height of market sentiment, widespread community discussions and hype sustain price momentum. However, this phase is typically accompanied by growing signs of a market top, increasing the risk of a correction. Investors who can identify the onset of a potential “bubble” and exit early to secure profits — while waiting for the next market dip — stand a better chance of maximizing returns.

3. Market Correction Phase
   Prices tend to fall rapidly as market excitement fades or negative news surfaces. During this phase, some meme coins may experience sharp declines. For long-term investors, this presents an opportunity to accumulate quality meme coins at a discount. The key lies in selecting coins with strong underlying fundamentals, solid community support, or promising transformation potential — rather than relying solely on hype-driven tokens that may quickly vanish.

4. Potential Revival or New Growth Phase
   Following a correction, some projects may successfully regain momentum through strategic adjustments, brand rebranding, or introducing new features. If these efforts manage to reignite investor interest, the coin may experience a fresh upward surge. However, some meme coins may fail to recover, ultimately crashing to zero. As a result, careful evaluation is crucial during this stage.

A prime example is the Slerf Coin project. After its presale, a mishandling error accidentally burned many of its reserved tokens. Surprisingly, this incident sparked intense community discussions, driving the coin’s price up. However, the surge was followed by a sharp decline. Subsequently, the project’s team launched a fundraising initiative to compensate investors, attracting support from influential KOLs (Key Opinion Leaders) and driving the coin’s price back up. This case illustrates how meme coin prices can fluctuate dramatically based on market sentiment and viral narratives.

How to Choose Meme Coins Based on Market Cycles and Profit from Price Swings

Monitoring meme coin market cycles is crucial for identifying optimal buying opportunities. The key to success lies in waiting for a market correction, selecting meme coins with strong fundamentals and solid community support, and leveraging price rebounds to secure profits. Naturally, this process comes with extreme volatility and inherent risks, making it essential for investors to implement strict risk management strategies. The following steps provide a structured approach:

1. Data Analysis and Market Sentiment Tracking

Use on-chain data analysis tools (e.g., AVE.ai) to track the flow of major investors’ funds and monitor changes in their holdings. Identifying meme coins that attract significant inflows during corrections can signal potential recovery candidates.

Monitor social media platforms such as Twitter and TikTok to assess discussion trends. A decline in online hype often suggests the market is shifting from a peak phase into a correction period.

Check trading volume and liquidity data regularly to ensure that the chosen meme coin maintains sufficient market depth. Adequate liquidity is crucial to avoid issues when entering or exiting positions.

2. Choosing the Right Entry Point

During a market correction, when most meme coins have fallen to relative lows and show signs of a potential rebound, focus on selecting meme coins with strong fundamentals, such as robust community support, recognizable brand identity, and clear future development plans.

Consider setting automatic take-profit and stop-loss orders to minimize losses or secure gains in the event of sudden market volatility.

3. Implement a Staged Buying Strategy

Divide your investment capital into multiple tranches to minimize the impact of sudden price fluctuations and improve overall entry timing.

For example, if the market clearly corrects to a specific price range, consider buying a small portion first. Gradually increase your position as the trend stabilizes, ultimately expanding your investment during the early stages of a potential price rebound.

4. Continuous Adjustment and Flexible Operations

Monitor your portfolio regularly and rebalance based on market trends. If certain coins show promising signs, consider gradually building your position. Conversely, if a coin’s prospects look dim, promptly reduce your exposure to mitigate potential losses.

Stay attuned to shifts in market sentiment and be ready to adapt your strategy accordingly. This flexibility allows you to capitalize on short-term price movements effectively.

The Future of Meme Coins: Bubble or Opportunity?

Regarding the long-term outlook for meme coins, they are often dismissed as purely speculative bubbles with little fundamental value, destined to burst like the infamous Tulip Mania. Historically, most meme coin projects have ultimately failed, with their prices crashing to zero once the hype subsided. Even major survivors like Dogecoin and Shiba Inu have seen their valuations drop significantly from their peak levels, underscoring the difficulty meme coins face in sustaining long-term momentum. Due to their weak long-term investment prospects and heavy reliance on market sentiment, meme coins struggle to be considered as stable investment assets.

However, the extreme price volatility of meme coins also presents potential opportunities for substantial short-term gains if investors can identify promising projects at the right time. Additionally, meme coins with large and loyal communities may explore transformation strategies to add practical utility to their tokens, potentially enhancing their longevity. Here are some notable transformation paths and application scenarios:

Integration with DeFi Ecosystems and Decentralized Exchanges (DEXs)

For example, the Shiba Inu team has actively developed its own decentralized exchange, ShibaSwap, to introduce real utility to their token and support long-term growth. ShibaSwap offers features such as liquidity mining, staking rewards, and token swapping services. Moreover, the platform includes a dedicated Launchpad, designed to help emerging projects raise early-stage funding. This approach not only expands the token’s practical use cases but also incentivizes token holders to adopt a longer-term investment mindset, gradually shifting the market away from purely speculative behavior.

Integration with Metaverse and Gaming Applications

Beyond DeFi, the Shiba Inu team has also ventured into interactive gaming and metaverse experiences, enabling investors to earn additional rewards by participating in virtual activities. This combination of gaming mechanics and crypto incentives helps strengthen existing communities while attracting a broader range of new investors.

Metaverse game developed by the Shiba Inu team (Source: Shib the METAVERSE)

Integration with Payment Platforms

As blockchain technology matures, meme coins are increasingly being integrated with mainstream payment platforms, e-commerce sites, and social media networks, serving as a low-barrier tool for tipping, shopping, or cross-border payments. For instance, Dogecoin, thanks to long-term support from high-profile figures like Elon Musk, has secured a partnership with Tesla. Customers can use Dogecoin to make purchases on Tesla’s online store — indicated by a Dogecoin symbol next to the product’s “Order” button, signaling that Dogecoin is accepted as a payment method.

While most speculative bubbles are destined to burst, a select few projects with strong community foundations or successful transformation strategies may survive once the hype fades — and potentially reach new highs in future market cycles. For investors, the ongoing challenge lies in distinguishing between fleeting bubbles and genuine opportunities — maximizing gains while avoiding pitfalls.

How to Buy Meme Coins?

Buying meme coins is quite similar to purchasing other cryptocurrencies. Beginners can follow these steps:

Using Centralized Exchanges (CEXs)

For well-known meme coins with larger market caps (such as DOGE and SHIB), most major cryptocurrency exchanges — like gate.io — offer trading pairs for them.

To get started, create an account and complete the required KYC (identity verification). Then deposit a stable cryptocurrency like USDT into your exchange account to fund your purchases.

Once funded, simply search for your desired MiniCoin’s symbol (such as DOGE or SHIB) on the exchange, enter the amount you want to buy, and place your order at the current market price. You can view your purchased MiniCoins in your wallet after the transaction completes.

Most mainstream meme coins can be directly traded on centralized exchanges (Source: gate.io)

Using decentralized exchanges (DEXs)

If you want to purchase meme coins that are not yet listed on centralized exchanges, you must use a decentralized exchange (DEX). A DEX is a cryptocurrency trading platform that operates without a central authority. Unlike traditional exchanges, DEX transactions are executed directly through smart contracts on the blockchain. Users do not need to deposit funds into the exchange; transactions are conducted directly from their personal crypto wallets.

For example, when using platforms like Uniswap or PancakeSwap, you must first prepare a compatible crypto wallet (such as MetaMask) that supports the relevant blockchain network. Additionally, you’ll need the network’s native cryptocurrency as a medium of exchange — for instance, ETH to swap for Ethereum-based meme coins.

When exchanging tokens via a DEX smart contract, verifying that you’ve entered the correct contract address is crucial to avoid purchasing counterfeit tokens or scam projects. Taking this precaution helps ensure you are investing in the legitimate meme coin you intend to buy.

Buying meme coins from a decentralized exchange (Source: Uniswap )

Storage and Security

After purchasing meme coins, you can keep the tokens in your exchange wallet or withdraw them to a personal crypto wallet (such as a hardware wallet or a mobile app wallet) for self-custody. If you opt for self-custody, it’s crucial to securely store your private keys and seed phrase to ensure the safety of your assets. Additionally, it’s recommended to review your account security settings regularly. Enabling features like two-factor authentication (2FA) on exchanges can provide an extra layer of protection and help mitigate potential risks.

What are Some Notable Meme Coins?

The meme coin market is filled with numerous projects, but only a handful have managed to stand out. In addition to the well-known DOGE, SHIB, and PEPE, here are some other notable meme coins:

Floki Coin

Named after Elon Musk’s pet dog, Floki coin emerged following the Dogecoin craze as another dog-themed meme coin. The project gained attention through aggressive marketing tactics, such as advertisements in the London Underground, which even drew scrutiny from UK regulators over compliance concerns. Despite this, Floki Coin leveraged strong community support to secure a spot among the top meme coins by market cap, maintaining a presence in the meme coin sector.

Floki is another dog-themed miniature coin (Source: Floki official website)

Nyan Cat Coin

Inspired by the viral Nyan Cat meme from 2011 — famous for its rainbow cat animation and catchy music — Nyan Cat Coin briefly gained market traction. Although the token lacked practical use cases, it capitalized on the meme’s original popularity and humor, attracting early meme coin enthusiasts. However, unlike mainstream meme coins, Nyan Cat Coin experienced a rapid rise and equally swift decline in popularity.

Nyan Cat coin is inspired by the rainbow cat meme (Source: Nyan Cat official website)

Baby Doge Coin

Baby Doge is a derivative of Dogecoin, featuring an adorable Shiba Inu puppy theme. With its low price and high token supply, Baby Doge emphasizes affordability and ease of trading. The project gained rapid popularity through charity donations and community-driven marketing, especially resonating with younger investors. However, due to its massive token supply and limited practical use, Baby Doge is generally considered a short-term speculative asset with higher investment risks.

A derivative of Dogecoin, Baby Doge Coin (Source: Baby Doge Official Website)

WAIT Coin

WAIT Coin originated from a viral TikTok dance trend that sparked a global wave of imitations, resulting in millions of related videos within a short time. Built on the Solana blockchain, WAIT Coin experienced a rapid surge in market cap but lacked strong cultural significance or a dedicated long-term development team. As a result, its market value remains highly volatile, and most participants view it as a heavily speculative asset.

WAIT Coin emerged from a viral TikTok dance trend (Source: TikTok )

Risks and Recommendations for Investing in Meme Coins

Investing in meme coins carries significant risks. Firstly, extreme price volatility is common. Sharp price swings of dozens of percentage points within a short period are normal[1], and instances of meme coins surging or crashing by over 100% in just 24 hours have occurred. Due to the lack of intrinsic value, meme coins can rapidly lose half their value or even drop to zero when online buzz fades or market sentiment shifts.

Secondly, the meme coin space is filled with speculative traps and scams. Unscrupulous teams frequently exploit trending topics to launch imitation meme coins, luring investors with exaggerated profit promises before suddenly cashing out and disappearing. A common scam tactic is the Pump and Dump scheme: project teams or large investors accumulate tokens at low prices, create artificial hype to push prices up, and then sell off their holdings in bulk — causing prices to crash. In contrast, unsuspecting retail investors bear the losses. Another common trick involves fake tokens that mimic popular meme coins, copying their names, logos, or even smart contract addresses to deceive investors into buying counterfeit or clone tokens.

A notable example is the “Squid Game Coin” scam in 2021. Promoted as a token linked to the hit Netflix series Squid Game, the project gained rapid traction through viral social media marketing. When the token reached its peak price, the developers abruptly sold off their holdings and vanished with investors’ money, resulting in the token’s value plummeting to zero — leaving most investors with devastating losses.

Overall, meme coins present far greater risks than conventional cryptocurrencies. Their prices depend highly on market sentiment, project lifespans are often short, and their speculative nature introduces extreme uncertainty. Furthermore, meme coins generally lack regulatory protection, meaning investments can vanish instantly if conditions turn unfavorable.

Given the high-risk, high-reward nature of meme coins, investors should adopt careful strategies to manage risks effectively:

Control Your Investment Amount

Invest only with disposable income — funds you can afford to lose — and never commit more than your financial comfort allows. It’s wise to treat meme coin investments as a small, high-risk portion of your overall portfolio rather than making them your primary focus. Avoid going all-in on speculative assets.

Conduct Thorough Research

Before purchasing any meme coin, conduct detailed research to understand the project’s background, community engagement, tokenomics, and development team. If possible, review the project’s whitepaper, community discussions, and even its source code to assess authenticity and feasibility. Avoid blindly following trends and steer clear of tokens with little transparency or those relying solely on rumors and hype.

Beware of Scam Traps

Be especially cautious when dealing with unknown meme coin projects, particularly those claiming celebrity endorsements or ties to popular IPs. Scammers frequently impersonate influencers on social media to build false credibility or entice investors with fake airdrop campaigns. Their ultimate goal is typically to drive prices up and cash out at investors’ expense. If a project claims “guaranteed profits” or lacks credible official information, it’s best to avoid it altogether.

Diversify Your Investments

Avoid concentrating all your funds into a single meme coin. Spreading your investments across various asset types — such as mainstream cryptocurrencies alongside meme coins — can reduce the impact of a single project’s failure. Additionally, within the meme coin sector itself, consider diversifying between well-established meme coins and smaller emerging projects to balance potential risks and rewards.

Establish a Disciplined Strategy

Given the allure of fast profits, it’s crucial to stay disciplined. Set clear take-profit and stop-loss points before entering a trade. When achieving your profit target, secure your gains rather than holding out for more. Likewise, if your investment moves in the wrong direction, adhere strictly to your stop-loss limits to minimize further losses. Avoid emotional trading driven by greed or frustration, and never let social media rumors dictate your decisions.

Treat Meme Coin Investing with an Entertainment Mindset

Finally, it’s important to approach meme coin investments with a sense of fun and entertainment. After all, meme coins originated as jokes, and their investment nature resembles speculative gambling or community-driven social interaction. Enjoying the process and learning from the experience is far healthier than obsessing over the dream of overnight wealth.

Before investing, accept the possibility that your investment could go to zero. By maintaining low expectations and embracing the unpredictable nature of the meme coin market, you improve your chances of surviving — and potentially thriving — in this volatile space.

Meme coins have successfully turned viral internet trends into monetizable opportunities in the financial market, creating tempting yet risky investment prospects. This double-edged sword requires investors to recognize its profit potential and inherent volatility. By thoroughly understanding what meme coins are, and implementing strict risk management principles, investors can make more rational decisions when navigating the meme coin craze. As the crypto market matures, the meme coin ecosystem will likely continue evolving. Investors who learn to balance excitement with rationality will be better equipped to seize opportunities — and avoid pitfalls — in this rapidly shifting landscape.