Meme Coin Demand Is Stronger Than Ever, Crypto Analyst Says

According to analyst Crypto Coryo, CoinMarketCap recorded a record 138 meme coins in April.

Fast money is after PEPE and WIF.

Meme coin season continues to roll forward, unaffected by Bitcoin’s {{BTC}} stalled rise.

Data tracking site CoinMarketCap listed a record 138 meme coins this April, further extending the parabolic rise from just 18 in April 2023, according to pseudonymous analyst Crypto Coryo. This number could be much higher, as CoinMarketCap reportedly lists only 10% of all tokens. Crypto Coryo said on X.

At the time of writing, 2,229 meme coins were listed on CoinMarketCap, with a total market cap of over $50 billion; It nearly matched the market capitalization of investment banking giant JPMorgan (JPM) and U.S. electric car maker Tesla (TSLA).

This is an impressive feat, as meme coins are often criticized for their lack of utility or real use case and are considered a proxy for pure speculation.

“In principle, people participate in meme coins because (i) the value can increase, (ii) they feel democratic and open to everyone’s participation, and (iii) they are fun,” said Vitalik Buterin, founder of the leading smart contract blockchain. It was stated in a blog post that Ethereum, which is also home to many popular memecoins.

Arthur Hayes, co-founder and former CEO of crypto exchange BitMEX and chief investment officer of Maelstrom, supports a deeper understanding of meme coins as a driver of blockchain ecosystem growth.

“You can call these things silly and worthless, but if it attracts attention and brings more engineers into the space, that would be a positive asset for the chain itself,” Hayes said in a March 30 interview with Real Vision.

Number of memecoins registered monthly on CoinMarketCap by chain. (Crypto Coryo)

Programmable blockchain Solana, which is cheaper and faster than its rival Ethereum, has become the new home for these tokens since late last year. At one point in the first quarter, the meme frenzy led to record network activity on Solana, pushing the price of SOL above $200 for the first time since November 2021.

“Due to high gas fees, degen activity has (partially) moved away from Ethereum. We saw this with Bonk on Solana and Bald on Base. But Solana is now the home of meme coins,” Crypto Coryo said. said.

Fast money chasing PEPE

Bitcoin’s recent sharp price movement has caused speculators to pursue the popular meme token pepe (PEPE). The token rose nearly 17% in seven days, making it the ninth best-performing cryptocurrency on the CoinMarketCap list.

It also has the second-highest perpetual futures open interest (OI) ratio relative to market capitalization, according to data tracked by Paris-based Kaiko. Dogifwhat (WIF), which is also a meme coin, has the highest OI-to-market cap ratio.

The story continues

“Pepe (PEPE) and Dogwifhat (WIF) exhibit ratios that are twice as high as other altcoins. A higher ratio indicates that an asset’s derivatives market positioning is large compared to its market cap, causing price discovery for these tokens to be more intense in perpetual futures , markets,” Kaiko said in the weekly newsletter.

Notional open interest refers to the dollar value locked in the number of active or open futures contracts.

Open interest/market cap ratio of top cryptocurrencies. (Kaiko)