Memecoins: Fleeting Trend or Crypto Evolution? - TOKEN2049 Singapore 2024

GM GM everyone uh very excited to be hosting this panel on mem coins um meme coins have been a very talked about topic this year not only this year but you know throughout the history of like crypto being a thing uh just wanted to give a great a quick introduction and we'll move on to the rest of the panelists to give a quick introduction as well so my name is Sandra um I work in kaido AI uh we're building a search engine for web 3 essentially indexing Twitter Discord foraster and all the information uh so

we're trying to build a information uh tooling hub for crypto we'll move on to Mad hey guys um my name is Morad been in crypto for a while um investing trading building um doing a bunch of different things Mike dudis uh founder of the block and currently managing director of six-man Ventures early stage investors and a bunch of phenomenal companies uh in the mem coin space you know pump uh Magic eatting and really excited to be here Zion Thomas uh you guys probably know me as anom been in crypto since 2017 I would say um

trading investing building do all of it hey guys uh my name is Andre gr okay yeah I in crypto since 2017 um we do Market making investing yeah and a lot of other things on the crypto Market thanks yeah I think we can start the panel with a bit of a history lesson uh just dating back to the evolution of mcoins uh what you think of you know the developments of the space um and you know were there anything that shocked you about you know how meme coins have evolved over time maybe we can start

with anom um yeah I think mem coins have gotten a lot of focus this but they've definitely been in crypto since its Origins I would say like if you look at the top 50 altcoins year-over-year from 2012 all the way to like 2024 it changes very very very frequently but one of the coins that always comes back Psy after cycle is Dogecoin um and doge is like one the most well-known I would say meme meme coin in crypto so like that's been consistent um I think throughout our our time pretty consistently this cycle I think

it's been even more evident about how easy it is for crypto to financialized things that already exist on the internet that's one of crypto superpowers in my opinion um and with how much people are online now there's memes that go go viral on Tik Tok Instagram like Twitter all these different places and these memes are known by a very wide like distribution of people so when you financialized those memes in the same way that you financialized attention with businesses in web too um that's how they end end up going to such high prices Mike do

you want to touch on some points yeah so just if I were to Super simplify meme coins and and their importance if you look any given day uh at the top you know 30 coins by trading volume you'll have at least 10 meme coins in that number uh and that's not changed for a number of years right that's been pretty consistent and in fact the share is increasing uh going as far back as Dogecoin you more more than a decade ago so a critical critical part of the crypto ecosystem and in fact I think even

more so as people become increasingly confused about why the coins that are being introduced these days need do exist so meme coins are critically important in in my opinion and almost I think empirically to the future of crypto yeah mad do you want to touch a little bit on um you know what you think the evolution has been you know you've been a very early sort of Bitcoin adopter and you kind of transition to more of a meme coin Advocate currently yeah so in 2017 during the parabola right we had one mem coin it was

Dosh in 2021 there was a very famous dog season and we had like a th000 a th000 dog coins and I believe four of them went above 5 billion right this time around it's growing exponentially I believe we already have over several million meme coins technically speaking and I believe that in 2025 meme coins will continue to outperform uh everything pretty much um if you study past cycles and if we assume that this cycle and 2025 specifically is going to be similar even remotely similar then you will see that the assets that out perform in

year three of a cycle go ballistic in year four and if you look at the top three pages of coin market cap AKA top 300 coins only 42 of them have outperformed BTC since the beginning of the year um and you have 13 of the top 20 being memes you have like a good chunk of AI in the middle and a bunch of sex coins like at the bottom right and I think the bitter truth is that people are realizing that the token is the product in crypto more so than software itself not always but

in many cases and I think the world outside of crypto is changing in the sense that the global money supply is like growing exponentially and I think that has an effect on people like mental health and so they're essentially being forced further down the risk curve so it makes sense that in 2017 we had like altcoins and icos and then in 2021 we had like defi gamei a lot of like Ponoma before 2017 and just outside of crypto bubbles always happen with assets that are difficult to value in like Microsoft Excel and I think meme

coins like not having revenues not having utility like not having any metrics essentially is extremely bullish because they can go as as high as possible and in the consciousness of the market we've already seen like Pepe go high with go high we've seen Doge and ship go to 50 100 billion so retail knows that this can happen and the amount of unlocks that you have on the tech side is like over 155 billion over the next four years so there's like a lot of headwind on like the tech stuff and there's like no headwinds on

the memes they're fully circulating so I think like the best among them are going to go crazy that's what I believe and so I'm essentially trying to evangelize that idea y you've been pitching like the meme coin super cycle idea for a bit on Twitter um maybe last person Andre do you want to talk more about like your investor perspective for mem coins no first of all uh from investors perspective in mem coins they give uh you a feedback if if your investment is successful or not much faster than uh utility tokens because there is

uh no wasting no development time nothing you invest it you see your result you have money or you don't have money but statistically uh there is also like quite quite large risk right as morat said right and this year millions of MIM coins have been launched but uh how many successful ones have been launched just a few uh and nobody talks about those millions and someone launched it someone bought it someone sold it and a lot of money was burned just a lot and that's why I would say that from investment perspective it's very important

what kind of uh narrative this mcoin follows what kind of uh character the mcoin uh uses and how many people can follow it and follow it and what kind of influencers support it because mem coins from investment perspective and From mcoin perspective it is not just something random of course some Randomness is happening and even uh single Miner with one mining machine has a chance to win a reward for a Bitcoin block but this chance is way less than uh mining Factory that has like millions of uh mining machines same here mcoin mcoins are a

proper business when you need to structure everything from the beginning to the success and without this it is purely gambling and I would say that with very very high de rate but if you found something good with good team with good narrative that can perform can involve good influencers good Community it usually outperforms the market you could take a look at top meme coins in the market and compare it with any of top wec coin on the market in a large scale let's say 3 five years no one can compete with m coins yeah I

think another good point to touch on is um how meme coins are successful and why they're successful um I think there's a lot of criterias that goes into you know what makes a mean Point viral and we've seen examples where you know anom you were very drawn to like the whiff Community uh mad with like the popcat Giga Community uh mad with like Bon and some others and Andre with like not coin and you know some other uh ton coins as well so I guess wanted to touch on what you guys think are like the

secret recipes of what makes a meme coin successful maybe we can start with um Mike yeah so there's no one recipe the the cool thing so basically in what 2021 22 we had the sort of nft craze it became clear that people would sort of speculate around these images and they sort of tried to pretend that the fact that they were non fungible was what was interesting but it it was really just like Hey we're enjoying these communities and we're speculating on them and we're having a lot of fun and we identify and then we

move on to the next one so meme coins I believe are like an advancement of that so the ones uh that do best you know Foster a community you know different types right so mad talks a lot about cults I'm sure a whole he'll talk about that after me um but we'll use you know Bon as an example that was you know at the bottom of the last bare Market salana not a lot of onchain activity you know Bon launched airdrop to developers to you know anybody who had basically transacted on chain and said hey

let's rally around this coin and let's you know get folks excited about the fact that maybe there's some value we can identify we can rally together and it was anybody could participate you could go to hundreds of thousands of people versus nft which could only go to like a thousand or a few thousand um so that has worked out pretty well they partnered with like a bunch of different projects in the community and it became sort of a you know resurgent brand in the salonic community whiff then came along and I think you know accelerated

that and maybe put it on steroids in in a good way and you know we've seen what's happened since but the point is it took a lot of those early principles of community fun doing things together and made it sort of more divisible expandable to more people um and it's basically taken it to its like logical extreme at this point where we're launching tens of thousands maybe hundreds of thousands you know some days of coins it gets back to the old you know there's a million tens of millions of YouTube videos launched per day um

but the principle stand uh which is that anybody can launch these things now to stand out you have to matter and have meaning uh and have like some principle underlying why you should exist and anybody can participate it's permissionless it's fun and nobody should make you feel bad about enjoying meme coins I say that as like a very serious VC yep anim do you want to touch on what made you very drawn to like the whiff Community um the whiff story is actually pretty funny I think generally there's a few different attributes that you can

look at when you're talking about meme coins um the first one which I think is the most important is relatability so if you think about your average persones doesn't know anything about crypto Finance anything if they can identify a meme coin to something they relate to or something they they know already in their life um then that Meme is a lot more likely to go viral than anything else um like one of the reasons that Doge did so well last cycle um is because people didn't need to know what a blockchain was like what a

L1 L2 like they weren't didn't need to know what defi was or how it worked um but they were able to connect dog a dog and coin like it's that simple to people um same way with whiff like dog with a hat I think the second um thing is like Varity so you have these memes that either exist on the internet already or are created by some some group or some group of devs um but you need a way to get them widespread to a lot of people so how is this meme coin going to

go viral it can be that it's connected to something that's already very popular or like I think people with a lot of followers on social media are actually really pivotal in the early stages of these mem coins because they just have so much Outreach to people um so the virality is another big thing and then distribution is also a really big part of memes um so early stages when you first launch a coin if you have like one person or a few people who have a ton of the supply that can be really bad because

it can put a cap on how high the me can go if something goes to 10 million one person has 10% of the float and like that's a million in upnl for them um you're typically going to have a cap but if you have more distribution as in like a ton of holders who have a smaller percentage of Supply um that's typically better for the memes in early stages because then you also have an army of people who are rallying rallying behind the meme all at the same time that's what happened with whiff like when

I first saw whiff it was around 100K market cap um I think like late November December um and I have this telegram chat which is like all the people I'm just talking about trades on salana eco with and it was getting spammed in my telegram chat like non-stop non-stop non-stop every single week they're back back back on it um so I had a ton of people who didn't have a lot of like capital in in the coin but it was a a ton of people like in with um and so when like I sparked it

when it when it um went viral on Twitter you always had that that really strong Community early on that was really important um I think the last thing is like extensibility so whiff one of the really cool things about whiff is that the Hat you can put on anything that is already on the internet so you can meme other things that people are that already go viral or people already um relate to and attach with to that so if you can attach the meme coin to something outside of just itself really well um that's another

way that things go go really viral yeah I think Morad you also mentioned a very interesting point where in order for mcoins to be successful it has to be a cult of some sort do you want to touch more on like your ult um versus Community thesis yeah yeah so um a very important concept to understand I think for the coming year is the rate of daily mem coin production so um in December 2023 in January 2024 like the nature of the mcoin market was completely different from March 2024 and even today right but generally

uh back then you had I don't know 20 mem coins being created per day right now you have 10,000 mem coins created per day I wouldn't be surprised if next year we'll reach a point where 500,000 m coins get created per day right so let's you need to essentially sit down and do an extreme thought experiment you need to assume that in the future there's going to be a meme coin for every animal every word every number every country every person essentially like every Concept in existence is going to be turned into a meme coin

right and you need to ask yourself in that environment what is going to win and what is going to lose right and I think what's happening right now and um like launch pads like pump fun are accelerating this process greatly is the mcoin industry is ESS essentially splitting into two one which we refer to as like PVP AKA hyper gambling which is like much more short term intra day intra week at most um just kind of like in and out like quick flips Etc right and the other is PVE which has more to do with

like cult building Community Building um for a lack of a better comparison like trying to build the next Doge at least attempting to be multicycle and just like having more substance about it right and um in order to identify the latter and I believe like the majority of the world the majority of retail and I think even the majority of people here in the audience they don't want to like rotate multiple times a day they don't want to like scalp trade multiple times a day I think like the vast majority of people they want to

find something they like Buy and Hold like Buy and Hold for a few months right and I think you need to figure out this is why it's getting much more competitive right obviously because when whiff came out it was a completely different Market when other stuff come out it was a completely different market like when Pepe was like the only coin at the time right this cycle then whiff there was already like 100 coins now there's Millions so you need to be you need to Now find like Diamonds in the Rough and fundamentally it's meme

coins are Supply divided by Demand right or I should rather say demand divided by Supply and so when we talk about cults we're focusing on the supply part what does what does that mean Cults mean people are not going to sell right and a lot of this stems from like the average holder where do they think the market is going right if you look at a lot of like pump fund launches and in the in the trenches or whatever people are like trying to sell at like 10 million 20 million 100 million right but then

there there's a handful of communities where their holders genuinely no matter how delusional that sounds they genuinely believe this is going to like 10 billion 50 billion 100 billion Etc right so you need to find those communities because holding is a function of belief right that's like the that's like the supply side so the other side is if people don't sell and then the demand eventually comes in then like the green candles are going to end up being longer because like there's no there's no sell pressure because those guys believe we're going to 100 billion

if they genuinely believe that they're just like not going to touch the coins so it's just Demand only that's why I think TRS are going to happen in memes last thing if it's a true cult then even while you're asleep you essentially have like an army of Obsessed skidos who are like working for their bags working for your bags right so a lot of people right now A they're making the mistake of thinking that Meme coins are dangerous I actually think if you identify culty ones they represent safety they represent emotional safety precisely because if

it legitimately is a called people are not selling right right second thing is if when when you tell a random person the word meme coin they think like dogs and cats like funny pictures but my thesis is that as years go by we're going to start seeing a transition from funny mem coins to serious ones right that they don't need to be a joke like it could be a serious thing and so the way I see it is we're going to have billions of meme coins that's totally fine I think we're going to have like

a 100 meme coins that are based on real memes that are going to be legit I think we're going to have like 20 Cults and I think within those 20 Cults you're going to have like hardcore movements or like Mission coins as I call them and like those three four like Mission coins I think they're going to go to the highest market caps and essentially if you're trying to find like the next big winner you want to find like the next mission the next movement because when you wake up in the morning at like 6:00

a.m. right an animal coin like doesn't really inspire you that much but if it's a mission coin people are really going to hustle like crazy so yeah yeah I think this is a good segue to start talking about pump. fun um you know it's one of the most Innovative uh crypto applications that has come out this in the cycle um maybe uh Mike do you want to touch a little bit on the implications of pum do fund um you know there are two extremes where people are like okay pump up fund is very bad for

retails um you know like only 1% of the retails are making money from pump up fund for example and then the other side of the coin where people love pum up fund um you know it's a way to any for anyone to launch a token so I think it's um you know two sides of the spectrum if you want to touch on it yeah so obviously a bit biased as an investor in pump uh you know it gets to the Chris Dixon you know everything important starts out looking like a a toy what pump did

is they basically made the creation of coins you know me we can call them meme coins but there's all types of coins that are launched on pump uh and even mirab is getting towards the point that we call everything meme coins but there's millions of different types of coins launched but anyway they've pump reduced the cost the uiux to basically zero now uh to launch a coin so I think that's a good thing allows anybody to create something of value put it out there promote it in the same way that 5 10 years ago people

first started to be able to put well many years ago text out there and then video and with Tik Tok you know we have endless distribution so we're at the very earliest stages of people being able to with no hurdles distribute something that has potential value right it was like Mark Andre's dream when you invest the browser like money could flow uh between you know people on any you know web page and it would be part of the protocol and it would literally be part of the core internet we're now getting there in sort of

a hacky way what 30 something years later um I'm not maybe that's I'm sounding like a VC now all right so that's too maybe overstating what's happening but the cool thing is anybody can launch something that anybody else in the world can ascribe value to and pump is doing it uh and there are other really cool companies doing it and I think really cool ways but pump's doing it in a way where there's incredible social features around it chat you know live stream now multiple live stream that looks like you know Twitter live chats uh

and they're just constantly iterating and it's sort of like mixing Tik Tok and social with money where it is today if you look at it um and if you kind of snapshot some of the stats uh the stats that 99% of people lose money dead wrong right like you can't see what's happening when the coins are on the bonding curve where people are generally making losing money but the cool thing is they've opened it up they've uh clearly made people extremely interested in this fact that we can launch a coin we can create an instant

community and it's accessible to everyone question is where do we go from here uh and what we're seeing and I'll leave it at this so other folks can talk is uh you see sort of adjacent projects doing hey live streaming live Bing um you know social streaming and bedding and sort of opinion markets and live prediction markets so we're sort of starting to I think Foster this really cool thing where people can not only speculate but like put a real opinion and maybe stake a little bit of money and value behind things that are happening

in real time and that like is human I mean that's like what people are doing on the streets like all the time that's what we're doing with our friends when we hang out and watching a sports game we're playing a game in our house and now we're just bringing it out and we can do with anybody in the world I think it's an incredible you know it's an incredible zero to one change yeah I think maybe um since we are we have 10 minutes left of the panel uh maybe a more interesting discussion is are

meme coins cap to the potential of their l1s because you see a lot of um people entering salana because they are investing in Bonk or whiff or any other uh salana meme coins um you know you've seen other uh chains launching their own meme coins um so what do you think like our you know the potential of meme coins cap to the price of their um l1s or can they actually outperform the L1 itself definitely uh that Meme coins are very good uh user acquisition tool for almost any CH not only for l1s but also

for l2s we can see a lot of examples how mem coins push these chains right you mentioned Solana after Bon 100 of thousand mem coins were launched uh even before pump fun then Millions after pump fun uh then say last year it was not tvl not reading volume in January some nice m coins was launched volume spiked tvl spiked user wallet spiked of course people want to have something to play with people want something to gamble people want something for entertainment and mem coins is the easiest way to attract these people definitely it's important and

then when uh and if distribution of these meme coins is really nice and if covers like really huge audience huge amount of PE huge number of people then these people when they sold this meme coins or when they hold this mem coins it doesn't matter they could try to do something else especially if they sold let's say if they sold I don't know not coin a drop and now I have 20 bucks it didn't change my life right but I could try to buy something I could try to start I know trading on centralized exchange

and de centralized exchange I can exchange the parts to the L1 native token of course this is nice and boarding and then I can think Beyond and from this point of view mem coins I would say they're not only important for the crypto for for for certain layer one but also for the industry because they can help the they help un board more people in the crypto in J yep I think um we can also touch a little bit on Celebrity coins um it's been it's been quite a heated debate um so anim do you

want to maybe take this off sure I can I can speak to the cele coins um yeah my my idea on the celebrity coins is we kind of have made the the stack of launching and trading me coins a little bit more efficient with pump fund I think it made it a lot more efficient like how easy it is for people to launch coins the piece of the puzzle or one of the pieces of the puzzles that has not been solved yet is the trust aspect so for the meme coins that do end up doing

really well they usually have um like people who are Champion them championing them and I have like a ton of followers online or influence in other ways like Elon with Doge was a big part of that uh you have people like DWF Labs who's working on on the uh trading and Market making side of things um there's really not a solved way to like know who all the different pieces are behind these teams Behind These meme coins and one of the issues with the Celeb coins is the teams behind them a lot of them had

bad intentions but they had all of the attention from either web 2 or other areas and it was like a mismatch there my idea on SB coins and why they make sense is the amount of influence um um and like Social Capital that celebrities athletes artists have in other areas if used in the right way can also be um used to direct attention to some product some coin something um but the issue is you have a lot of Bad actors and when you have a lot of Bad actors it kind of can paint a a

bad picture for the entire um idea or thing yep do you guys have any thoughts on Celebrity coins I think it's early like to date uh they've most have failed like I think Iggy's here and mother's doing pretty well it's like any other sort of startup or new project like most of them are going to fail uh in this case as anom said we had a lot of Bad actors but um I think there's no question if we do this right um again the notion of like putting out tokens that have value tied to your

identity tied to your Humanity um and tied to your community that you connect with are going to matter um but yeah that doesn't mean like hey launching you know a coin uh with a send money to this address and then sort of sniping it and dumping it so I think unfortunately there were a few folks who got involved early and sort of screwed up for most folks who are interested um and I think mad's got it right the the folks who sort of do it natively are in the trenches um probably are the ones who

are going to be most successful not SBS right now y I think we've touched a lot on sort of the current landscape of mem coins uh maybe now we can look a little bit into the future um you know what do you guys uh speculate are going to be new Innovations in the mcoin space if there's any um I think that the way I look at the current uh pump fun I look at it as like a mini game that people play um and people have kind of wrote off gaming in crypto I think pretty

actively uh this cycle um I think that's going to be wrong I think that there's going to be a lot of ways that you set up similar mini gamess to pump fun with coins nfts um all these different things that people can play um with like um like high high expectations of winning even though it's like low percentage of winning they're trying to hit a 10,000x I think that people are going to try like do creative ways creative things with gaming um around like coins and nfts one of the um things that hasn't been touched

on as much this cycle as I've expected is the hybrid um like the 404s which is nfts that can be fractionalized um into coins um I'm actually really surprised we haven't seen more projects do that in interesting ways so I think that's going to happen as well yeah one other one I'll say is like when I uh you know have an initial conversation with Founders and they plan a lot a token I I often ask them even if it's a serious project like do you actually think that your token is going to have fundamental value

or do you think it's going to have like M mtic value I mean if you look out in the market today and you try and do uh you valuation or like any sort of fundamental cash cash flow analysis on most you know defi tokens dpin tokens you're just not going to get to anything that would make you buy most of these tokens relative to purchasing Equity you know in in the larger uh public stock markets so I think one thing that's going to happen in in the future is a recognition that crypto one of its

massively I think amazing and wonderful attributes is that EV virtually everything that has value today Bitcoin ethereum salana has bootstrapped immense amounts of its overall value that's acred to date via mtic value right you know Bitcoin as a sort of emerging store of value when it was you know not that many people mining it many years ago and I think that's so critically important helium you know bootstrapping dpin before there was any Revenue but getting folks involved in this network caring about it so I just think mimetic value is going to pair much more with

virtually every project in crypto uh especially as we hear about things like Ai and crypto and some of these themes that we were talking about earlier uh that I believe actually will get investors really interested in buying these themes and these names and really riding with them for four five six years uh until they start to return call it again real utility or underlying fundamental value yeah I think if we're wrapping up right now so maybe a spicy question to end um if you were to pick three meme coins to hold for the next cycle

uh what would your pick B we'll start with Andre what m coins would I hold to hold yeah I prefer to not give any advice I made at Vally today and yeah I don't want say advises anymore um I'll say with M and probably Mei I think three yeah so I can't give Financial advice I'm a registered investor advisor but I'll just talk about you know Meme coins that I like you know BTC soul and usdc um the three highest conviction picks I have right now are SPX 6900 Giga and popcat do you want to

go into why you pick those three options yeah for sure so first first of all everything I mentioned is a cult but then you need to start asking yourself like what's after Cults because like all of the top 20 are going to be hardcore Cults so how do you like take it to the next level and um SPX 6900 for example and Giga to an extent as well I feel like they have a potential to evolve from a cult to the next stage which is a movement right so if meme coins originally started as like

pretty much tokenizing pictures and memes we are now going to evolve to a more serious level which is tokenizing ideology or tokenizing philosophy tokenizing like extremely abstract like political ideals and I think those things if they really really go viral they can go to ridiculous valuations and I will make even a concrete prediction that we will see one or two meme coins go above Doge alltime high of 95 billion I would probably give some without naming mem coins right but just in general if we talking about meme coins to hold for next cycle or for

this year I would take a look at memes that have FD up to above 20 mil uh with the small exchanges Perpetual markets but with no binance Perpetual markets then your risk is kind of less than to buy something on pum fun because when it is listed somewhere it had it could be crashed but not immediately right but your potential upside if it gains traction could be like 10 times 20 times or more that's in general advice like this and we make decisions we make decisions like this yeah yep I think with that we'll wrap

up the session for today thank you guys for coming and hope you enjoyed the session