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Why Meme Coins Need Quality Market Makers With Advanced Algorithms Rather Than Token Dumpers
It was bound to happen. As society became more and more interconnected with social media and finance became more and more tech-savvy, the intersection of pop culture and finance was bound to intersect. Instead of a beautiful synergy of two ideas, it felt more like a head-on collision and meme coins were born. While the first meme coin to achieve widespread fame was Dogecoin (DOGE), many have followed in its wake. In the case of DogecoinWhat started as a prank to make fun of cryptocurrency has turned into a cult following, which has morphed into the same passionate community that raised money for the Jamaican bobsled team to compete in the 2014 Olympics. Since this surprising success, many others have followed, with the trend even trickling back into mainstream finance with the “meme stock” that was Gamestop. But why have meme coins taken on a life of their own, why have they created so much controversy, and what role can they play in legitimate finance? Let’s find out.
Why are meme coins a part of today’s society?
The idea of a meme coin is both absurd and more honest than many financial instruments and collectibles. Creating value from what is essentially a meme, or a short-lived joke, is similar to any other fad. Tickle-Me-Elmos, POGs, fast fashion trends. These are all money-making ideas that arose from a spike in popular interest and nothing more. What is interesting about meme coins is the intersection with legitimate financial instruments. The world of cryptocurrency has democratized our ability to create a digital, fungible currency with a fixed mintage and circulation. Instead of having to quickly design and mass produce a product that leverages a rapidly evolving meme, teams can create a meme coin overnight to capitalize on its popularity quickly and at very low cost if the team has the right talent. At the other end of this trend is the collectible element. Meme coins can act as a type of currency, yes, but they also act as a limited edition collectible, and that is what can help drive up prices, especially in the short term as popularity increases. Everyone wants to get in on the action, so the prices of limited supplies go up. However, it is what the development team does next that can determine whether that stock crashes and disappears forever, or stabilizes and grows beyond a meme to become a legitimate cryptocurrency with a long-term community of support. This is perhaps the most frustrating part of meme coins in today’s environment. Teams with bad intentions may intentionally launch a coin for a pump and dump scheme, which will inevitably hurt those who want to be involved. However, beyond being bad form and bringing disrespect to the cryptocurrency industry, more and more teams are seeing that this is a short-sighted move for meme coins because they have a place in the longer lifecycle of cryptocurrency markets. With the right TGE guidance and MEV market creation tools (organizations like Peanut trade specialized in these services, even for meme coins), meme coins can be successful in the long term.
Scams and Scandals
Meme coins have long been, and still are, a source of speculative investment and potential pump-and-dump schemes when they launch. There are several signs to look for to determine if a meme coin is a scam, although there are no guarantees either way. Coins with little community presence that suddenly gain popularity, especially from certain influencers, may be on the rise only to crash shortly thereafter. Market volume and uneven liquidity are bad signs, as is a lack of transparency and online presence from the development team itself. White papers and detailed roadmaps, on the other hand, show a purpose for the coin and indicate a long-term plan. However, with any meme coin as with any investment, never invest more than you are willing to lose.
Strategies for Aligning Platforms and Investors
For development teams aiming to launch a legitimate meme coin, you need to be aware that there are predators looking to take advantage of your token launch even if you have the best intentions. Being able to combat those who seek to artificially inflate prices when the coin is launched to dump it is critical. Teams need to have tools in place to safeguard liquidity from Third party arbitrage botsbut they need to design their tokenomics and smart contracts to be robust and long-term focused from the start. As mentioned above, there are organizations like Peanut Trade that offer end-to-end services to guide this process, and teams may find an advantage if they are looking to build a long-term community focused on stability and passive profit for their project’s treasury.
Successfully launching any token, but especially a meme coin, over the long term requires strategy and commitment well before launch, but it also requires a strong hand (and automated tools) on launch day, with management tools working to keep things fluid until the coin stabilizes on its own. Once that happens, the few that are well managed can last for years and grow their communities into global forces.
This is the weirdness of our modern world. The ability to create your own cryptocurrency, where things like Dogecoin started as a joke and became a billion-dollar wealth fund, where a borderless community around the world can unite around any idea they want and develop something together for the long haul. It’s a weird world, but it’s pretty amazing.
Disclaimer: This content is informational and should not be considered financial advice. The views expressed in this article may include the personal views of the author and do not reflect the views of The Crypto Basic. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
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