As Exciting as Meme Coin, Blockchain Solana Becomes the Main Home
6/14/20244 min read
In the midst of the increasing popularity of meme coins in 2024, the Solana blockchain turned out to be the main home for most of the meme-based cryptocurrencies.
Galaxy Digital's research results also reveal that the popularity of meme coins can continue, because they are a new medium of expression of contemporary internet culture, and in particular are an important foundation of the crypto economy.
Meme coins are a type of cryptocurrency created or issued on a blockchain based on famous internet memes or humorous concepts. These coins are a representation or tokenization of viral ideas, often featuring humorous or satirical themes, often even absurd.
Unlike regular cryptocurrencies, such as Bitcoin (BTC) and Ethereum (ETH) which are known for their technological innovation, meme coins usually have no intrinsic utility or practical use. Instead, the popularity of meme coins derives their value and popularity from viral appeal, community support, and the speculative nature of crypto trading, both on centralized crypto exchanges (CEX) and decentralized crypto exchanges (DEX).
An example of a well-known meme coin with the highest market value in this sector is Dogecoin (DOGE), which was originally created as a parody of Bitcoin in 2013, but has since gained significant market value and popularity, thanks in part to Elon Musk.
Another popular example is Shiba Inu (SHIB) on the Ethereum blockchain, which has the same theme as the Shiba Inu dog Kaboshu from Japan and is narrated as an opposition to DOGE. There is also Pepe Coin (PEPE), themed on the popular internet meme Pepe the Frog by Matt Furie and others, which provides returns of up to thousands of percent in a short time.
In fact, recently there have been many meme coins that carry celebrity themes, including presidential candidate Donald Trump. Trump himself has enriched his campaign program through the issuance of NFTs.
Meme Coin is Vibrant, Its Market Capitalization Reaches US$ 60 Billion, Blockchain Solana Dominates
“Dogecoin is recognized as a pioneering meme coin, but in recent years the popularity of meme coins has become increasingly popular. We estimate that meme coins on permissionless blockchains currently have a total market capitalization of over US$60 billion. "The growth of meme coins is based on shared monetary relationships among non-fungible token (NFT) project holders and suggests that communities, cultures, groups, and trends may increasingly rely on monetary instruments for speculation," stated Galaxy Digital's research note.
The market value is quite tasty, based on Galaxy Digital's records, Solana will become the main blockchain for a large number of meme coins in 2024. The reason is that the low transaction fees on Solana reduce barriers for users who want to create and trade meme coins.
"In addition, the fast transaction confirmation speed makes the experience of using this blockchain equivalent to uploading meme content via a browser on the internet," explained the company.
The end of 2023 will be a turning point for the existence of memes on the blockchain. Averaging around 9K new tokens per day between August to November 2023, Solana is now averaging more than three times that at around 28K tokens per day. At its peak, it reached 100,000 new tokens per day using a 30-day moving average (670,000 live).
"While not all of these tokens are meme coins, the large meme culture that exists on Solana allows this blockchain to become a proxy for the creation of meme coins in general in the crypto market," explained Galaxy.
The top Solana blockchain-based meme coin by market capitalization has averaged between US$91 million and US$109 million in on-chain swap volume over the past 30 days. Bonk and WIF, the two largest Solana meme coins by market capitalization, have averaged 59 percent of volume during that period.
As the volume increases, the user base also grows. Ten of Solana's leading meme coins have more than 1.136 million unique holders combined. Please note, this figure counts addresses holding more than one of the meme coins included as one holder. This trend highlights the reach that meme coins have achieved and the speed with which this trend has gone viral.
The World's Largest Home Ethereum Blockchain Outside of Dogecoin
Meme coins didn't start on Solana. DOGE is one of the first and most valuable meme coins in the crypto market, launched in 2013 and now worth US$24 billion as of May 29, 2024.
Outside of Dogecoin, Ethereum is the leading blockchain for meme coins in the 2020–2022 crypto bull cycle. Serving as the home to iconic memes such as SHIB, and more recently PEPE and Harry Potter Obama Sonic 10 Inu, Ethereum played an important role in memes finding a foothold on the blockchain. Although activity on Ethereum has migrated to other blockchains, Ethereum still holds the second and third largest meme coins in SHIB and PEPE, as part of the meme coin boom.
“As the number of meme coins increases, their market size also increases. The top meme coins as of May 29, 2024, had a combined value of US$57 billion, up 3.5 times from the same day a year earlier and 4.8 times from the bear market's low point. An interesting characteristic of this data is that four of the seven meme coins depicted were created in the last 511 days of May 29, 2024; with two of the seven launching within 160 days. "This highlights the fast-moving nature of meme coins and their lack of staying power as human culture and the internet continue to evolve rapidly," explained Galaxy.
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