
Meme coins, the new financial vitamins?
Re:
https://www.axios.com/2025/01/18/trump- ... 25-billion
"Trump launches meme coin, apparently makes more than $25 billion overnight"
"Trump has warmly embraced cryptocurrency as a concept and an industry, to the point that
he is reportedly considering designating it a "national priority" as soon as this week,"
Q: What is a cryptocurrency meme coin?
(Perplexity) A cryptocurrency
meme coin is a type of digital currency that is typically based on internet memes,
popular cultural phenomena, or humorous themes. Unlike traditional cryptocurrencies that focus on technical innovations
or underlying blockchain networks, meme coins
derive their value primarily from their virality, social media presence,
and community support.
Key characteristics of meme coins include:
- Cultural inspiration: They often reflect viral trends or popular internet memes.
- Community-driven: Meme coins create strong, often humorous communities that celebrate the coins and associated memes.
- Speculative nature: Despite their humorous origins, some meme coins are seen as investment opportunities with high volatility.
- Low entry barrier: They often allow people without deep cryptocurrency knowledge to participate in the market.
- Limited utility: Many meme coins lack practical uses beyond being tradable tokens.
Examples of well-known meme coins include Dogecoin, which was created in 2013 as a joke but gained significant popularity, and Shiba Inu.
These coins have shown the potential to reach substantial market capitalizations, despite their unconventional origins. It's important to note
that while meme coins can be profitable investments,
they are highly speculative and carry significant risks due to their volatility
and often limited practical applications."
(Perplexity) "Cryptocurrencies like Dogecoin, despite being created as jokes, remain popular for several reasons:
- Community support: Dogecoin has built a passionate community that appreciates its fun and lighthearted approach to cryptocurrency.
This strong community has been involved in various charity projects and online events, contributing to its popularity.
- Celebrity endorsements:
High-profile figures like Elon Musk and Mark Cuban have promoted Dogecoin,
leading to significant price surges and increased public interest. Musk's tweets referring to Dogecoin
as "the people's crypto" have had a profound effect on its value.
- Accessibility and low cost: Dogecoin's low price per coin makes it accessible to a wider range of investors,
especially those new to cryptocurrency. Its presence on popular platforms like Robinhood has also increased its accessibility.
- Practical uses: Despite its origins, Dogecoin has gained some practical applications. It's accepted as a form of payment
by various online merchants and businesses, including the Dallas Mavericks for ticket and merchandise purchases.
- Market dynamics:
The cryptocurrency market is not always rational, and the popularity of meme coins
demonstrates that fundamentals are not the only factor driving value in the crypto space.
- Social media trends: The virality of meme coins on social media platforms has contributed significantly
to their popularity and price movements.
- Potential for high returns: The volatile nature of meme coins like Dogecoin has attracted traders
looking for quick gains, despite the high risks involved.
While the
long-term sustainability of meme coins remains questionable due to their lack of strong fundamentals
and development, their popularity persists due to a combination of community support,
celebrity influence,
and the broader cultural phenomenon they represent in the cryptocurrency world."
(Perplexity) "The
Greater Fool Theory strongly applies to cryptocurrency meme coin investing!
Meme coins often lack fundamental value or utility, relying heavily on speculative behavior
and expectation that someone else will buy them at a higher price.
This investment approach in meme coins aligns with the Greater Fool Theory's core premise:
investors buy overvalued assets, disregarding fundamentals, believing they can sell to someone else
at a higher price later. The recent meme coin boom exemplifies this, with
prices driven more
by speculation and hype than intrinsic value."

Since popularity is often the primary support of cryptocurrencies,
meme coins now seem another reminder to "Buy low! Sell high!"
Rod
