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Cultural Memecoins Could Surpass Traditional Tokens in Profitability, Says Mechanism Capital Co-Founder

Algoine News
Summary:
Andrew Kang, co-founder of Mechanism Capital, predicts that "culture coins" or memecoins centered around cultural values like politics, religion, and lifestyle could surpass traditional meme tokens in profitability. He cited examples like Solana-based tokens Jeo Boden and Doland Tremp, which cater to communities with strong right-wing views. Kang also highlighted consumer brand-based memecoins like ZYN and MOUTAI which could leverage their associated brands' lifestyles for additional virality. Despite mixed opinions, memecoins notably influenced the Q1 2024 crypto market, with the top ten memecoins providing 1,312.6% average gains for their holders.
Andrew Kang, a co-founder at Mechanism Capital, suggests that "culture coins" which cater to specific cultural values like religion, politics, brands, and lifestyle will potentially yield more profits this cycle than conventional meme-based tokens that revolve around comedic or animal-related themes. On April 7, he stated that culture-based memecoins are inherently more likely to go viral, surpassing the fame of memecoins such as Dogecoin (DOGE) or Shiba Inu (SHIB) from the previous cycle. Kang observes that communities with ingrained identities and values naturally aim to sway others to their ideologies, displaying their preferred lifestyle with pride, which makes them inherently viral. According to Kang, these value-based communities can solely focus on politics, religion, sports, lifestyle, consumer goods, or a combination of these factors. Kang pointed out two specific examples of culture coins that emerged on the Solana blockchain — Jeo Boden (BODEN) and Doland Tremp (TREMP) — which quickly amassed followers holding "anti-woke, anti-Biden, and right-wing views." BODEN, since its first launch on March 9, has seen exponential growth, boasting a whopping increase of over 700,000%. Currently, Boden's market value stands at $473 million, ranking it the 191st largest token by overall value, according to CoinGecko data. In contrast, the Donald Trump parody coin, TREMP, launched on February 27, didn't gain as much momentum as BODEN, with a market cap of $73 million, according to Birdeye data. Kang also highlighted memecoins that are inspired by successful consumer brands, namely ZYN and MOUTAI - his firm's investments. He noted these tokens could leverage the lifestyle associated with these brands for heightened virality in a "circular economy" of gains. Despite the debated impact of memecoins on the crypto sector, with views ranging from BitMEX co-founder Arthur Hayes's positive endorsement to criticisms stating they betray the founding values of blockchain technology, memecoins have significantly influenced the crypto market dynamics. A CoinGecko market report reveals memecoins were the most profitable sector in Q1 2024, with the top 10 largest memecoins yielding an average gain of 1,312.6% for their holders. "The memecoin narrative was 4.6 times more profitable than the next best-performing crypto narrative of tokenized real-world assets (RWA), and 33.3 times more profitable than the layer 2 narratives with the lowest returns in Q1 this year,” stated CoinGecko analyst Lim Yu Qian.

Published At

4/8/2024 8:26:00 AM

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