Meme coins still generate profits, but not for everyone. Investors told crypto.news how much they were able to earn from the meme coin hype.
Meme coins recorded a surprising performance of 1,313% on average in the first quarter. And this sector does not even think about stopping its growth, which generates millions of dollars in profits for merchants.
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It is natural for huge positive price surges to occur in a matter of days or weeks. But what is all this about?
What are meme coins?
Memecoins are a type of cryptocurrency whose popularity is directly related to Internet memes and viral marketing on social media. Typically, they are initially created as a joke with no practical function.
The first and most famous token was Dogecoin (DOGE), launched in 2013 based on the popular Shiba Inu dog meme. Initially, DOGE was intended to be a parody of bitcoin (btc). However, over time, this asset obtained a capitalization of one billion dollars.
The main difference between meme coins and traditional cryptocurrencies like ethereum (eth) or bitcoin is the lack of intrinsic value and issuance restrictions. Their cost depends entirely on demand amid the Internet boom and, because of this, meme coins are characterized by higher volatility.
However, recently there has been a trend to give meme currencies greater practical importance. For example, the developers of Shiba Inu (SHIB) and FLOKI are creating their own metaverses, nft platforms, and educational ecosystems based on these assets.
Millionaire profits: this year's trend
The number of meme tokens issued grows with enviable regularity and traders manage to make fortunes from them. However, that success is usually short-term and random. In the long term, as the popularity of the Internet declines, the value of most meme coins tends to zero.
Presumably, those who make millions of dollars from meme tokens have inside information. Otherwise, how would these traders and investors know that the prices of certain meme coins would show rapid growth? crypto.news editors spoke with traders who could make profits on condition of anonymity.
Frog Investments
Members of the Pepe (PEPE) crypto community are celebrating the new all-time high for the frog token. In the midst of this, one user said that he turned just $90 into $1.4 million thanks to PEPE.
In mid-April 2023, a trader bought almost 6.5 trillion PEPE on the Uniswap crypto exchange just for fun. Since the initial investment amount was small, the trader did not sell the tokens and decided to see what would happen to them.
This decision turned out to be the most correct: in May 2024, 6.5 billion PEPE turned the anonymous trader into a dollar millionaire. However, a user with the nickname Mina said that she has no intention of selling PEPE and now believes that one day the price of the frog coin will exceed the dollar.
“Sometimes I want to sell my PEPE, but I keep it as a reminder not to rush. The meme coin market has not finished conquering the peaks yet, and it is likely that my PEPE will make me a billionaire in a year.”
Mina, anonymous trader
Strong belief in dogs and love of hats.
A trader from the meme coin Telegram community shared an impressive profit story with the Dogwifhat coin (WIF). However, this case is not like the inspiring stories of traders whose coins grow 1000 times in an hour.
The anonymous trader used a different strategy: HODL. He purchased WIF in December 2023 and analyzed the overall activity on the Solana network and the growth prospects of the crypto market.
After weighing all the risks, the trader bought approximately $500 worth of tokens, hoping for further growth. As a result, he earned around $15,000 simply by holding assets on his balance sheet.
“I've heard stories of traders making billions of dollars in profits starting with just $100. However, as an active participant in the crypto community, I consider these stories to be the exception to the rule. The meme coin market is still very opaque and confusing, so inspirational stories about traders are probably simply insider trading.”
Coin meme community member
More conservatism
Another member of the crypto community with the nickname Andilet urged caution when investing in meme coins and shared his strategy for diversifying assets. He advised dividing the cryptocurrency portfolio by risk level, with 10% of the portfolio made up of volatile and high-risk currencies, including meme coins.
Despite the high risk, allocating part of the portfolio to meme coins seemed appropriate since meme coins are more likely to provide significant profits.
“In general, it is difficult to predict in the long term how the meme coin market will behave, because in memes everything depends largely on hype, the level of which is also difficult to predict.”
Andilet, SHIB investor
He invested in Shiba Inu in the summer of 2023 and spent around $5,000 to purchase coins at a price of $0.0000077. Now, with a SHIB rate of $0.000025, his assets are worth around $50,000.
“I think that in the case of meme coins, an individual approach to each project is important. “You can guess the short and medium term trend if you study the project carefully.”
Andilet, SHIB investor
In short: to invest or not to invest?
Investing in meme cryptocurrencies is a considerable risk. This can lead to solid profits due to speculation, successful exit timing, and a complete loss of capital. The main thing is to monitor social media, read the news, be able to search for information and the first time a media personality mentions a meme coin, try to get it.
