1. The era of synchronized growth in crypto assets has ended.

2. The Memecoin supercycle has begun, and the time is now.

3. Any crypto asset that does not allocate cash flow to your wallet or serve as a store of value is a Memecoin.

4. The cryptocurrency industry is not technology-driven but asset-driven.

5. Memecoins are not a parasitic attack on crypto technology; they are a counterstrike against traditional crypto tokens.

Memecoins have stirred up a frenzy in the cryptocurrency market, making the Memecoin supercycle not just a prediction for the future but a reality that is already unfolding.

When we review the performance of all major cryptocurrency categories so far this year, you’ll find a mixed bag with many disappointing tokens. However, as shown in the chart above, Memecoins have performed exceptionally well. Currently, older Memecoins are doing well, while newer ones are showing extraordinary results. The era of synchronized growth across all crypto assets is over, and the sentiment of “we will succeed” is now outdated. This is a natural progression in the development of the crypto space.

As shown in the chart above, you’ll find that only 43 tokens have outperformed Bitcoin so far this year, and 13 of the top 20 performing tokens are Memecoins.

# Why does the meme coin cycle occur?

There are two driving forces behind the Memecoin cycle: one internal to the crypto space and one external. Let’s first look at the internal factors within the crypto space.

1. Token Overproduction: By April 2024 alone, over 600,000 new tokens had been launched, with more than 5,500 new tokens added daily. This overproduction has flooded the market with new tokens, leading to severe dilution of many projects’ value.

2. Severe Inflation in Altcoin Valuations: When these tokens get listed on centralized exchanges, their valuations are artificially inflated. Founders acquire tokens at almost zero cost, while VCs and angel investors purchase large amounts at very low prices. Then, centralized exchanges, market makers, Twitter influencers, Telegram group callers, YouTubers, and others promote the projects in exchange for tokens or money. Retail investors ultimately become the liquidity exit for these projects. When you launch a project with a $10 billion valuation, retail investors are the ones left holding the bag.

3. Price Surge in the Private Sale Phase: The vast majority of altcoin price surges occur during the private sale phase. By the time tokens are publicly listed, their valuations often reach $500 million, $1 billion, or even $1.5 billion, leaving retail investors with little opportunity to profit. Instead, they are lured into a bubble at the peak price of these tokens.

I firmly believe these tokens are deliberately pushed into the market with excessively high initial valuations. Even if the token inevitably drops by 90% early on, seed investors can still make hundreds of times their initial investment, while retail investors are misled into thinking these tokens are being sold at a “discount.”

In 2024, all newly launched tokens on Binance, with two exceptions, have seen declines. One exception is Whiff, which has shown almost no growth since its listing, and the other is Jupiter, which is closely tied to Memecoin trading infrastructure. These facts send a strong signal: most newly issued altcoin projects have not performed well.

# Problems within the industry

Without the inflow of retail funds, the entire token market cannot be sustained, but the vast majority of retail investors never care about the underlying technology.

Even though we’ve been using smart contract technology for over a decade, successful non-speculative decentralized applications (dApps) in this industry remain rare. If you look at projects like Uniswap, dYdX, GMX, and Solana, these are probably the ones with the best product-market fit in crypto history, yet they still largely depend on speculative activities. 99% of altcoins are not worth their valuations, and many projects do not distribute dividends, often citing regulatory reasons, when in reality, it’s simply not in their interest.

Some projects generate as little as $500 in daily fees, yet they are valued in the billions of dollars. This phenomenon is very common, and these infrastructure tokens clearly won’t serve as a store of value for money. The value of these tokens often depends on narratives, imitation effects, and market hype, rather than being evaluated based on actual revenue.

# The unique advantages of meme coins

In contrast, Memecoins have unique advantages. They do not need to rely on complex valuation models or actual revenue to support their market capitalization like traditional tech tokens. Their strength lies in their simplicity and directness—the token itself is the product. Memecoins are not an attack on crypto technology; rather, they are a counterstrike against crypto tokens. Both Memecoins and altcoins are essentially promoting the same thing—the token itself, rather than the underlying technology.

Memecoins are the spiritual embodiment of the 2017 ICO wave, but they have emerged in a completely new form and are more pure. They represent a more straightforward community economy that does not depend on complex technical narratives, instead attracting the market with easily understandable concepts.

Many venture capital-backed tech projects are overvalued and lack genuine community support. In contrast, Memecoins leverage community to build strong brands and loyalty, allowing projects to sustain operations. While venture capital projects rely on private sales and high valuations to drive the market, Memecoins harness the power of community to enable participants to profit and become loyal advocates.

# Promoted by external environment

In addition to internal industry factors, external environments are also driving the development of Memecoins. Today’s global economy is vastly different from what it was four years ago. Inflation is soaring, and the prices of everyday goods continue to rise. The rapid advancement of artificial intelligence even threatens job opportunities in traditional STEM fields, while wealth inequality has reached historic highs, particularly in regions outside developed countries.

The increasing feelings of loneliness, sexual repression, and mental health issues have led more individuals to turn to the virtual world in search of belonging and meaning. Against this backdrop, Memecoins have become a popular choice. People are not only seeking wealth in Memecoins but also looking for fun, identity, and a sense of community.

#The power of narrative and culture

Memecoins are essentially a Swiss Army knife, offering a range of products that provide identity, culture, escapism, reduced loneliness, community, hope, and much more. I believe the influence of religion in the world is waning, while brands, experiences, and communities are filling that void. You can see this reflected in video games, music festivals, yoga, DMT retreats, CrossFit, SoulCycle, ketogenic diets, and, of course, financial assets.

The formation of trends requires narratives for support, and the success of Memecoins is driven by stories of people achieving massive gains through simple means, which continuously spread throughout the industry and social media. For example, Pepe, Bonk, and Whiff have become successful case studies in this cycle. These stories breathe new life into Memecoins, propelling the ongoing development of the market.

History shows us that assets that perform well in the first half of a cryptocurrency cycle often continue to do well in the second half. For instance, Ethereum surged in 2016 and spiked again twice in 2017; Verge rose dramatically in 2016 and then again in 2017; Solana soared in 2020 and rebounded strongly in 2021. Therefore, I believe the Memecoin craze we experienced in March 2024 is just the first wave of three upward trends, with two larger surges expected in 2025.

# Market positioning of meme coins

The success of Memecoins is not solely due to speculative behavior. They represent a more organic market model that allows ordinary investors to gain wealth simply by holding the tokens. Memecoins have transformed those who struggled to profit in other markets into loyal advocates, driving the spread of the entire project.

The future of Memecoins lies in their potential to be more than just speculative tools; they embody a new economic form—tokenized communities. The best Memecoins will evolve into enduring brands and cultural symbols, representing not only wealth but also a sense of identity.

The future of #memecoins

The Memecoin supercycle has begun and will continue to evolve. I predict that the market capitalization of Memecoins will reach $1 trillion, with a quarter of the top 20 on CoinMarketCap being Memecoins. Over time, utility tokens and venture-backed altcoins will continue to underperform, while Memecoins will dominate the market.

Memecoins are not just a market phenomenon; they represent a new model of community economy. Their simplicity, clarity, and high level of engagement make them some of the most vibrant and promising assets in the cryptocurrency industry. If you want to seize the next big opportunity, Memecoins are undoubtedly a space worth watching.

In summary, Memecoins are simpler than tech altcoins, more liquid than NFTs, and safer than DeFi. They lack inflation, unlock periods, and the pressure of venture capitalists pushing them onto you. Your odds of success are better than sports betting or casino gambling, with greater volatility (which means more excitement). They present a fresher narrative, offering retail investors a chance to win, and the community is more enthusiastic than in any other crypto asset class. The best crypto products do not need tokens, and the best crypto tokens do not require products.

Again, the Memecoin cycle is not a prediction; it is already happening, and Memecoins dominate across every metric.

So here are the predictions: the market capitalization of Memecoins will reach $1 trillion; we will see two Memecoins with market caps exceeding $100 billion; ten Memecoins will surpass $10 billion in market cap; a quarter of the CoinMarketCap homepage will be occupied by Memecoins; Memecoins will command a 10% market dominance; utility and venture-backed altcoins will continue to perform poorly; the “Fat Protocol” theory will gradually fade as establishing value storage and gambling (ranks four and five) becomes increasingly difficult; venture capital firms will purchase blue-chip Memecoins, and savvy VC firms have already started doing this; traditional finance will invest in Memecoins, and astute traditional finance entities have already begun this process; we will witness Super Memecoinization before Super Bitcoinization; and many will discuss faith economics, the tokenization of faith, and the financialization of new religions.

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