「Speculation」 to「Investment」, Is Meme No Longer Just PvP? | 100x Retrospective

The "Speculative" Era of Memecoins

Many people say that this cycle's Solana is equivalent to the previous cycle's Ethereum. A key piece of evidence is the wealth effect brought about by this cycle's Pump.fun, which mirrors the wealth effect brought about by Ethereum's ICO in the previous cycle. We have seen many coins achieve a thousand-fold or even ten-thousand-fold increase in value within a few days.

Everyone can now launch their own Memecoin on Pump.fun, undoubtedly attracting funds to the blockchain. This has attracted many the Web3 held in centralized exchanges (CEX), as well as a significant amount of Web2 incremental funds. There has even been the introduction of Moonshot, a fiat currency trading platform that perfectly bridges the last mile between Web2 and Web3 Memecoins.

Related reading: "After bridging the "last mile" of Meme coins, does Moonshot also have a listing effect?"

Perhaps it is precisely because of this "sudden wealth" effect and the very low barrier to token issuance that many people are just "grabbing and running." Many people believe that investing in Memecoins has turned into a speculative activity akin to "passing the parcel." Many Memecoin players believe that the key to riding meme trends is to "run fast."

This wealth effect has attracted many new on-chain users, and the market capitalization of most Memecoins is inflated. Various "hard-to-find angles" can bring about FOMO for many people, rapidly driving up the market cap. Once the market cap nears $20 million, many quickly take profits, leading to a rapid collapse after early holders or project teams exit in a stampede. Many "narrative-based" Memecoins experience a brief surge before gradually entering a "zeroed-out" state.

Interestingly, in Web3, a realm where information transmission is traditionally very fast, it takes a long time to reach consensus for value discovery. Many Memecoins that now appear to have broken out have gone through this process. For example, GOAT quickly reached a market cap of around $20 million after token issuance, then swiftly fell back. It went through a long period of consolidation around $10 million before value was discovered, leading to further price increases. Another example is Ban, which reached a market cap of around $5 million shortly after token issuance, then plummeted by over 80% amid PVP and community FUD. After more than 20 hours, it finally reached community consensus, rapidly driving up its market cap. Coins like ACT, Pnut, which have also experienced "project team betrayal," are no exception.

Why do narrative-angle Memecoins like this take so long for price discovery? Undoubtedly, this is highly related to the deeply rooted PVP logic. Speculators are afraid that early chip holders will "crash the price for profit" and quickly go to zero, always remaining in the "PVP" logic.

However, all of this has recently undergone a new change.

The Age of "Crypto Gold" Memecoins

Trump's election as U.S. President ushered in the era of "crypto gold" memes.

This not only represents the mainstream recognition of cryptocurrencies represented by Bitcoin in the market, the political endorsement of BTC ETF will attract more U.S. stock investors to invest in the cryptocurrency market, but also represents a relaxation of U.S. political regulation on cryptocurrency. DeFi tokens are seen as "securities," reducing the possibility of regulation, and meme coins can enter the investment landscape of U.S. investors.

Coinbase added Pepe to its listing roadmap, Binance launched ACT and Pnut, combined with Elon Musk's multiple endorsements of the squirrel Peanut on social media, stating his intention to establish a government efficiency department named after the Dogecoin, solidifying the influence of meme coins. Undoubtedly, Elon Musk is a staunch supporter of meme coins, saying, "America is saved by a squirrel and a meme coin."

As Murad once said, "We are at the beginning of the Meme Supercycle." The average market capitalization of meme coins is also continuously rising. After Coinbase listed Pepe, Pepe's total market cap once exceeded $10 billion, and after Binance listed Pnut and ACT, Pnut's market cap reached a high of $25 billion, currently at $18 billion, ACT's market cap is close to $10 billion, Goat's market cap is around $1 billion, Doge's total market cap ranks in the Top 5. It is visibly evident that the market's acceptance of meme coins has increased significantly.

On November 13, Moonshot stated on its social platform that the platform's fiat inflow set an innovation record. "Non-crypto native users are flooding in."

The "Investment" Era of Memecoins

Binance is also making efforts to contribute to the development of Memecoins. The logic behind listing Memecoins on a centralized exchange (CEX) may have originally been based on market cap, supplemented by a so-called "Listing Fee." However, Binance listing ACT and Pnut has signaled a new beginning for CEX support of Memecoins.

For Memecoins, what's important now is not just market cap, but rather community and narrative. After all, even a project like ACT with a total market cap of twenty million US dollars can be listed on a top-tier CEX. Following the announcement, a significant wealth effect was generated. Currently, ACT has a market cap of eight hundred million US dollars, and individual investors have been able to achieve over a 10x return through manual arbitrage leveraging information asymmetry.

This wealth effect not only demonstrates Binance's recognition and support for the Memecoin industry but also sets a direction for Memecoin communities. Memecoins with outstanding narratives and perspectives and excellent community cultures have a good chance of being listed on a CEX. Recent projects listed on Binance indicate that nearly half of the newly listed projects are Memecoins, spreading Memecoin culture through CEX channels to better develop Memecoin culture.

For individual investors, the investment perspective in Memecoins has shifted. It's no longer just about rushing into meme projects for internal competition, as narrative-lacking meme coins are no longer as popular. Some top-tier investors believe that this shift is actually more beneficial to the market. There's no longer a need to "pan for gold in shit," throwing money into a bunch of internal projects that can't even launch, consuming capital in internal competitions. Instead, the focus is more on perspectives and narratives, followed by community building and project promotion to get listed on exchanges. This shift embodies the essence of Memecoins, no longer solely relying on "early pumps and quick exits" to make money.

The market's imagination regarding Memecoins has widened. The scenario where a market cap close to $20 million would quickly lead to profit-taking and trigger a mass exodus resulting in almost "zeroing out" has diminished. The previous delineation in the market as to whether a coin is a "sh*tcoin" was a market cap of $20 million, and many "semi-sh*tcoins" fell before the $20 million threshold.

Now, Pepe is preparing to be listed on Coinbase with a market cap exceeding $10 billion, ACT is listed on Binance with a market cap exceeding $500 million, GOAT has a powerful AI meme narrative platform behind it with a market cap exceeding $1 billion, and after Elon Musk's frequent endorsements, Pnut has a market cap exceeding $1.5 billion. The market's anticipation and admiration for "big sh*tcoins" above $1 billion are once again growing. The market is gradually understanding Murad's statement that "the trajectory of the Memecoin supercycle is for 7-8 Memecoins to become digital tribes valued at over $200 billion."

For the DEV issuing a Memecoin, the pricing of the Memecoin market cap has been raised, reducing the "pump and dump," focusing more on community development, enhancing the cultural aspect, and improving the integration process with CEX.

And this is also good news for individual investors. Investing in Memes has become more like a true investment. From the perspective of research and community, look for meme coins that are still in the early stages, wait for price discovery, get listed on CEX to target a broader Web3 audience or the Moonshot Web2 audience.

There are now many "diamond hands" voices in the market, positioning meme coin market cap in the billions or even tens of billions of dollars. Many people say, "Either Pnut goes to 4B, or it goes to zero, but absolutely no selling in between!" The PVP logic seems to have changed, where early buyers of Pnut in the primary market have now made over 210,000 times in profit, with a cost of 0.1 SOL, acquiring over 4 million U.S. dollars in profit, but they still hold firmly.

As of the time of writing, many "almost-golden" projects that had once shown promise but ultimately did not fully take off have seen significant increases in their market cap.

Many Memecoin projects that we once thought had "gone to zero" have had their value rediscovered. Their value may be unearthed in the expectation that they may be "Listed on CEX" in the future. Moreover, many memecoins that truly represent a community culture have been released, returning to the original cultural value of Memecoin. Behind them may be an AI proxy robot, a new "internet-famous animal," or an eagle that needs to be set free.

As Murad said, "Meme coins are a test. Considering them as jokes and funny pictures is a failure. Understanding them as unstoppable tokenized communities is true comprehension." We have seen signs of the Meme SuperCycle gears slowly beginning to turn, with Meme culture stepping out of PVP and opening a new chapter.