Meme coins have been ranked among the most popular cryptocurrency narratives of 2024, creating a gap among cryptocurrency tokens. Bitcoin stands out among the top cryptocurrencies with 125% year-to-date gains, and the category of memes, or “other tokens,” has achieved a major milestone, surpassing a market cap of $100 billion.
Dogecoin (Doug), Shiba Inu (Gray) and baby (baby), where the three most important meme currencies lost between 11% and 13% of their value in the past week. Bitcoin is consolidating near $95,000, roughly 12% below its all-time high of $108,353.
Bitcoin vs. meme coins, the most popular narrative of 2024
Memes have captured the attention of most cryptocurrency traders and emerged as a trending narrative this year. A CoinGecko report updated on Monday indicates that the meme has captured 30.67% of global investor interest.
The report highlights that nearly a third of interest in cryptocurrency narratives this year focused on speculative gains from memecoins. Traders focused less on fundamentals and shifted their attention and capital toward dog and cat-related memes, pop culture references, and personalized online tokens.
Meme coins have enjoyed a 6% year-over-year increase in interest from cryptocurrency market participants. While Bitcoin gained institutional attention and capital allocation following the approval of Spot BTC ETFs in the US, four meme-based trends ranked among the top 20 crypto narratives.
Solana (Sol), cryptocurrencies, artificial intelligence, and cat-themed meme coins received between 14% and 8% of interest among cryptocurrency narratives.
As meme coins consolidate their place as a popular token class and the trend of this cycle, catalysts such as institutional allocation and ETF approval could pave the way for further gains for holders.
Base, Solana, and XRP memes dominate the premium memes in speculative gains
In the first week of December, XRP-based memes generated gains for holders amid growing importance and demand for the XRP Ledger and its native token XRP. Likewise, meme coins based on Solana and Base ranked among the top 20 cryptocurrencies of the year and dominated the popularity of premium meme coins.
Dogecoin, SHIB, and PEPE are typically considered blue-chip memes, with a market capitalization between $7 billion and $46 billion, as shown on CoinGecko. The top 3 meme coins noticed a significant spike in active addresses and activity from traders during the first two weeks of December.
In the past seven days, the top 3 coins have erased double-digit value, according to CoinGecko data. Several other tokens have accumulated double-digit losses, with the exception of Pudgy Penguins (PENGU).
Institutional coin holdings have tripled this year
The wave of meme adoption has prompted institutions to reduce their holdings in this category. From February to March 2024, institutional investors' spot holdings of memcoins rose from $62.5 million to $204.8 million.
This represents a 226% increase, a significant spike in interest in the memecoin market, according to Bybit. a report On institutional investing in meme currencies.
In the Bybit report, Eugene Cheung, President of Bybit Enterprises, was quoted as saying:
“Our ‘Beyond the Hype’ report shows that institutional and retail investors are actively taking advantage of the opportunities presented by the memecoin market. The strategic flexibility of institutions and dynamic management by retail investors reflects an evolving engagement with these assets. We invite everyone to dive into the full report to understand these dynamics.” task better.
Possibly a Dogecoin ETF in 2025?
The growing institutional adoption has raised questions about the possibility of US financial regulator, the Securities and Exchange Commission, approving meme ETFs. Nate Geraci, president of ETFStore, expressed shock that the issuer has not yet applied for a Dogecoin ETF, both inside and outside the US.
Geraci believes the only potential downside to such a filing is that it would represent a futile endeavor and end up as a marketing expense for the issuer. The head of ETFStore commented on the “DOGE” ticker since it is an indicator of the largest meme coin and is likely to carry the highest importance and demand among issuers in the future,
Since the SEC has given the green light to the hybrid Bitcoin-Ethereum exchange-traded fund, DOGE traders are hoping for the Dogecoin ETF to get approval in 2025.
The divide between bitcoin and meme currency is deep
Ruslan Lenka, Head of Markets at YouHodler, told Crypto.news in an exclusive interview:
“Dogecoin's recent performance appears primarily speculative, driven by its association with Elon Musk, rather than any underlying fundamentals, as it still lacks significant real-world use cases. However, a potential benefit could develop in the future.”
Lienkha comments on what differentiates Dogecoin and similar meme currencies from Bitcoin. While Bitcoin has gained acceptance as “digital gold” and a hedge against the decline in the value of fiat currency, Dogecoin and the like are considered speculative tokens.
The divide between Bitcoin and meme coins is deep and could impact the approval of meme ETFs, more investment from institutional investors and retail participation in this category in the second phase of the bull market.
A pullback in Bitcoin typically triggers a sharper market-wide correction, erasing recent gains from memecoins and hitting the market cap of the category negatively. The correlation with Bitcoin can continue to drag down cryptocurrencies, and in each case, the largest cryptocurrencies crash or react to a market-moving event during this cycle.
Disclosure: This article does not constitute investment advice. The content and materials contained on this page are for educational purposes only.
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