The cryptocurrency landscape has always been defined by extremes: serious decentralisation projects, complex financial protocols and a chaotic undercurrent of irreverence. At the heart of that chaos is the memecoin ecosystem, a phenomenon that blends internet culture, speculative trading and community dynamics into a digital theatre of humour and high-risk finance. From Dogecoin’s light-hearted beginnings to the rise of PEPE, FLOKI and WIF (even Trump has issued one), memecoins have carved out a distinct, influential niche in the broader digital asset market. Significantly, the memecoin sector is worth approximately $76billion currently with memecoin market cap having grown by 500% on 2024.

Source: TeamBlockchain (CoinMarketCap)

Arguably, the memecoin revolution began with Dogecoin, launched in 2013 as a tongue-in-cheek parody of crypto hype. Featuring the iconic Shiba Inu from the “Doge” meme, it was never meant to be taken seriously. Yet a passionate community and high-profile tweets from Elon Musk helped push Dogecoin to a market cap of around $26 billion to date, turning a joke into a juggernaut. Shiba Inu (SHIB) followed in its pawprints, branding itself as a “Dogecoin killer”. But although it introduced basic DeFi tools such as ShibaSwap, its momentum came largely from viral marketing, meme culture and massive token burns rather than ground-breaking innovation; SHIB peaked with a market cap of roughly $7.9 billion. More recently, memecoins such as Pepe (PEPE), Floki (FLOKI) and dogwifhat (WIF) have pushed the genre even further into absurdity. PEPE, built around the controversial cartoon frog meme, has reached a valuation of approximately $3.6 billion. Floki (FLOKI), inspired by Elon Musk’s dog, has gained traction with a market cap of around $820 million and WIF, centred on a Shiba Inu wearing a knitted hat, has surged to an astonishing $610 million. In this space, utility is often an afterthought - instead, value is driven by viral appeal, meme fluency and the speed of digital tribalism.

What distinguishes memecoins from other altcoins is not tech or innovation, but culture - communities form quickly around memes, jokes, lore and the simple joy of being in on something absurd. The typical memecoin community lives across X (formerly Twitter), Discord servers, Telegram channels and dedicated meme pages. These spaces become echo chambers where users celebrate price pumps, roast rivals and rally around shared in-jokes. Loyalty in these communities is less about long-term vision and more about “vibes”, i.e. the mood, humour and camaraderie they share. It is not uncommon for holders to refer to themselves as a “cult”, embracing irrationality as a feature rather than a bug. This can create astonishing momentum and market movement driven almost entirely by narrative and community sentiment. The memecoin ecosystem also thrives on accessibility and speed. Most coins launch without the need for deep infrastructure thanks to decentralised exchanges (DEXs) such as Uniswap and PancakeSwap, which allow for instant token creation and trading. A memecoin can go from idea to market in under an hour, often supported by launchpads or “token factories” that provide templates and automation. Smart contracts for memecoins are typically minimal, often simple ERC-20 scripts with no burn or tax functions. The simplicity lowers the technical barrier, allowing anyone with basic skills to create and deploy a memecoin.

However, these markets are far from fair. Trading bots, especially sniping bots, dominate the early action; these bots monitor liquidity pools and front-run human traders to secure the best entry prices. This results in extreme volatility during the first few minutes or hours after launch, often leaving retail investors at a disadvantage. But memecoin markets are not for the faint-hearted. Traders known as “degens” chase early access to coins that can yield 10x, 100x or even 1,000x returns. And the degens strategy is brutal and fast: identify a hot narrative, buy early, ride the pump and exit before the inevitable dump. Information travels through “alpha groups” - private Telegram or Discord circles where early tips and insider leaks are shared. Furthermore, influencers often act as signal boosters - a simple tweet, emoji or meme from a well-followed account can send a memecoin’s price into a frenzy. Unsurprisingly, these traders are not typically loyal - their interest is fleeting, fuelled by charts, hype and the dream of hyper returns. Therefore, this creates an environment where liquidity can evaporate as quickly as it arrives. Memecoins are, above all, storytelling machines. Their narratives are not built in whitepapers, but in memes, threads, stickers and jokes. Influencers, meme lords on X and Telegram administrators craft stories that feel inclusive, rebellious or irony and nostalgia, pop culture and controversy are often repackaged as rallying cries. Whether it is a coin based on an old video game character or one parodying a political figure, the storyline matters more than the fundamentals. So when a coin captures the collective imagination, it spreads like wildfire. Yet these cycles are short-lived - what is viral today is forgotten tomorrow, which means memecoin projects are in constant pursuit of relevance. You could almost think of them as newspapers today, ‘fish and chip paper’ tomorrow.

Essentially, most memecoins operate using standard token protocols - on Ethereum, this means ERC-20; on Solana, SPL; and on BNB Chain, BEP-20. These tokens usually have minimal features sometimes no more than a name, symbol and supply figure. Bridges and token deployment tools such as Remix or Thirdweb allow for rapid multichain launches, further boosting reach and volume. Many new memecoins are deployed across multiple chains, simultaneously, to increase accessibility and speculation opportunities. Interestingly, whilst technical complexity is low, creative branding and smart community management often make up for it. The easier it is to deploy a token, the more the differentiator becomes culture, not code. However, when addressing memecoins, it is important to include the prevalence of scams and pump-and-dumps. Many projects vanish within weeks, either due to liquidity drains, developer disappearances or outright rug pulls which occur when developers withdraw all liquidity, leaving token holders with worthless coins. Moreover, given the low cost and speed of launching memecoins, bad actors frequently exploit the ecosystem to run exit scams. Predictably then, in response, a cottage industry of whistleblowers and rug trackers has emerged. These tools audit smart contracts, scan for suspicious patterns and provide real-time risk indicators, and whilst they cannot eliminate bad faith, they serve as essential resources for cautious investors navigating an unpredictable landscape.

Why memecoins matter

It is easy to dismiss memecoins as a distraction from “real” crypto development, but they do serve as a lens into the emotional and cultural side of Web3. Where traditional tokens aim for utility or governance, memecoins embrace chaos, humour and collective psychology. They often onboard new users in a way that feels native to internet culture - a teenager who buys a meme token because of a funny tweet may later explore DeFi, NFTs or staking. Memecoins are not merely speculative assets, they are gateways to digital participation. In May 2023, KuCoin conducted a survey with 500 adult crypto investors aged 18 to 60. The results showed that Gen Z (18-25 years old) represented 19% of crypto investors in France, highlighting a significant presence of younger participants in the market. Moreover, memecoins challenge our assumptions about value - i.e. Is value defined by tech, or by belief? If thousands of people choose to believe in the power of a frog, dog or banana-themed token, then that collective belief becomes a force to reckon with.

The memecoin ecosystem is a strange paradox. It is unserious in form, yet deeply serious in function. It moves billions in volume, commands vast online audiences and continually reshapes how people relate to money, identity and culture in digital spaces. For every rug pull and crash, there is also a moment of genuine community, unexpected creativity or viral success. The line between comedy and commerce continues to blur, making memecoins a uniquely Web3 phenomenon - one where laughter, risk and tribal identity co-exist. Whether you love them, hate them or quietly hold a bag of WIF “just in case”, memecoins are not going anywhere. As long as people are online, laughing and speculating, no doubt there will be a new meme ready to ride the next wave.

This article first appeared in Digital Bytes (19th of August, 2025), a weekly newsletter by Jonny Fry of Team Blockchain.