This year, the memecoin market has been booming, even as Bitcoin remains stagnant. However, despite the popularity of memecoins, there are serious questions about their long-term sustainability.
Popularity of Memecoins
Memecoins, such as Dogecoin and Shiba Inu, have achieved significant success due to their light-hearted and entertaining nature. They have become the crypto equivalents of meme stocks like AMC and GameStop. As of March 2024, there were about 2,000 memecoin projects, with roughly 1,000 having trading volumes higher than zero. By August, around 1.7 million tokens had been launched on the PumpFun platform.
Analysis of Memecoin Sustainability
Memecoins attract substantial investment through short-term speculation. According to Binance, memecoins saw a nearly 600% increase in value in 2024. However, only 3% of created memecoins continue to exist, with about 2,000 disappearing monthly. This creates a risk for the long-term sustainability of this sector.
Alternative Investment Directions
For long-term cryptocurrency market growth, more promising directions might include tokenization of real-world assets (RWA) and artificial intelligence (AI). Tokenization allows real assets, such as real estate and art, to be transferred to the blockchain, creating more stable sources of liquidity. Additionally, the AI market, predicted to reach $297 billion by 2027, can significantly contribute to the industry's development.
Despite the impressive growth of memecoins, more reliable sources of liquidity are essential for the sustainable development of the cryptocurrency market. Sectors related to tokenization of real-world assets and artificial intelligence represent promising directions for future investments.
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