Why Meme Coins Lack Sustainable Growth

The rise of cryptos has seen changes envelop the world and revamp the global financial sector. This growth has seen different types of cryptocurrencies being developed in the digital financial system. Meme coins are one of the most popular categories of cryptocurrencies in the modern world and are widely used by the crypto community. These coins are typically tokens that bank on the popularity of pop culture references or internet jokes as the basis of their growth.  In the modern world, many different meme coins exist, Dogecoin being the first and most valuable of the lot. Following its inception in 2013, Dogecoin brought forth a wave of users as people swarmed to use the tokens with the pooch. The relevance of these tokens has thus spurred the growth of the category. However, while meme coins have been renowned for their explosive growth, they lack sustainable growth, an aspect that will be explored below. How Meme Coins Work Meme coins are products tied to internet jokes created to make fun of digital finance developments. These tokens often emerge from videos, pictures, or funny statements and are widespread across social media channels. The popularity of these coins makes them valuable as the coin prices explode quickly, earning significant profits.  These coins are seen as viable investments for experimentation as individuals jump onto the hype. Thus, investors use the meme-themed tokens in the market without incurring the risk posed by higher-priced stable coins like bitcoin. This process is visible from the rise of Dogecoin and other doggy-themed coins that came after its success. What Makes Meme Coins Lack Sustainable Growth? Meme coins have explosive potential given their relatively low pricing. However, they also pose significant risks to users as their traits make them susceptible to adverse outcomes. These unique traits impeding the sustainable growth of the coins include: Lack of Developer Communities In the world of digital finance, cryptos projects are associated with their unique communities. These communities are social clusters made up of any number of individuals. The clusters are united by sharing interests, ideas, and pursuits. Any tokens using blockchain technology usually have communities on social media platforms such as Telegram and Viber in the crypto world. These communities help create a sense of induction, build trust and allow community members to communicate. The community also helps new people to understand more information about their investments. However, in the case of meme coins, these communities are either non-existent or unstable. The lack of stability poses a great risk to the tokens as they become very volatile and may lead to more issues.  Limited Ownership For most cryptos, ownership of tokens is often widespread across different parts of the world. This ownership allows individuals to either buy or sell the tokens. Ownership is widespread for the most stable cryptos, with many people owning small amounts of the tokens. This type of balance creates security while limiting volatility. However, in the case of meme coins, ownership is often limited to a small group of people. These individuals often hold quantities of tokens that can affect the market. The owners can also tip the market in any direction due to the low liquidity of tokens.  These features make meme coins volatile as negative actions by the small groups cause havoc and losses for other small users. This kind of risk causes limited trust and wards off many investors.  Use of Copied Code For the blockchain network to function, it must develop suitable code. The code can then be updated or upgraded to enhance the network’s performance or its security. In the case of many cryptos, the community behind it is in charge of developing and maintaining the functions of the blockchain network.  However, the code used is copy-pasted from other networks for meme coins. These coins suffer from limited development, and in many cases, code development comes to a standstill. As a result, the blockchain network becomes stale, and the community and interest cease growing.  Author’s Take  Meme coins mainly grow due to hype being the internet jokes. Therefore, following the loss in popularity of the inside jokes, the hype behind the coins drops. This drop causes ripples across the community and often cuts down interest and investment into such crypto tokens. In the digital finance, meme coins are a marvel that was created in 2013. Using internet jokes and existing code, the developers created a crypto token category with the global community buzzing. These coins rode on the popularity of the jokes to become assets.  However, due to their unique traits, the tokens have limited growth. The loss of hype and use of copied code make the growth of these coins hard to continue. The absence of stable developer communities and limited ownership makes cryptos difficult for investors. Thus, these features collectively impede … Continued

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