Why Did Memecoins Go On Bull Run Last Week Amid Market Downfall?

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Why Did Memecoins Go On Bull Run Last Week Amid Market Downfall?

The past few weeks have been quite volatile for the cryptocurrency market, with many coins experiencing significant price fluctuations. One trend that has been particularly interesting to observe is the sudden rise in popularity of so-called “memecoins” during a period of a market downturn.

Memecoins have grown in popularity over the past several years due to their distinct personality and connection to a specific trend. Since meme currencies typically don’t have a clear purpose, the value of such coins depends on the buzz and community devotion.

Memecoins, exactly like how their name sounds “more of a joke and mimic” have little to no value to deserve a significant market share. Public opinion is consistently positive towards cryptocurrency assets with compelling use cases and value propositions.

The year 2022 was a terrible time for all coins, including Shiba Inu (SHIB), but 2023 has provided new hope for these coins. When traders return to their preferred locations, the price of cryptocurrency tokens increases. As a result, SHIB has been picking up steam during the past week. 

What Sent the Memecoins’ Price Up the Hill?

One possible explanation is that investors are turning to meme coins to make quick profits during a market downturn. Investors may look for alternative investment opportunities when traditional cryptocurrencies like Bitcoin and Ethereum experience a decline in value. Memecoins, with their low price point and high volatility, can be attractive to investors looking to make a quick profit. 

Another possible explanation is that memecoins have become a cultural phenomenon. These coins are often associated with internet memes and have gained a cult following among certain online communities. The popularity of meme coins like Dogecoin and Shiba Inu has grown beyond just the cryptocurrency community, with mainstream media outlets and celebrities like Elon Musk talking about them on social media. This increased exposure and cultural relevance may be driving up demand for meme coins, even during periods of a market downturn. 

Memecoins: Quick Overview

A memecoin is a formal type of cryptocurrency that is often based on a meme or internet trend. Examples of meme coins include Dogecoin, Shiba Inu, and Safemoon. These coins typically have no real-world utility and are not backed by tangible assets or technology. Instead, their value is based on their popularity and the willingness of people to buy and sell them. 

Top 3 Memecoins to Buy in 2023

  • Dogecoin – The first meme coin to be released in 2013 was Dogecoin. A hard fork of Litecoin created the Dogecoin network. Up until 2021, the token with a dog theme had fallen. Elon Musk heavily pushed it when it started to soar in 2021, soaring more than 20,000% in a single year. In addition, the top Cryptos by market valuation, DOGE is #1 among the current top 5 meme currencies! Its supply is practically endless, but that is a subject for another day. The best-performing cryptocurrency in 2021 wasn’t DOGE. 
  • Shiba Inu – Another community-driven coin with a dog theme is the self-described “DOGE killer,” the second biggest meme currency on our list. SHIB is referred to as “an experiment in decentralized spontaneous community building” on its official website. There are 1,000,000,000,000,000 SHIB tokens in circulation overall (or 1 quadrillion). The Shiba Inu is a Japanese hunting dog breed that inspired this project’s name. It is built on the blockchain of Ethereum. 
  • Safemoon – The motto of SafeMoon, “Safely to the Moon,” was introduced in March 2021 and was derived from the idiom “to the moon,” which means “to rise in value fast.” The CEO of SafeMoon is John Karony, a former analyst for the US Department of Defense. Soon after its launch, SafeMoon quickly surpassed one million Crypto holdings. One of the meme coins with the biggest potential today is SafeMoon. 

Conclusion

The sudden rise in popularity of meme coins like Dogecoin and Shiba Inu during a period of the market downturn may be due to investors looking for alternative investment opportunities or the coins’ growing cultural relevance. However, it’s vital to remember that investing in meme coins comes with significant risks and should be approached with caution.

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