The Risk and Reward of $PEPE, Dogecoin and more

With NFT sales volume falling steadily since January 2023, memecoins – such as $PEPE, $DOGE and $TURBO – have emerged as the center of attention in the crypto space. Unlike conventional cryptocurrencies such as Bitcoin and Ethereum, memecoins are used primarily as trading instruments and lack any specific tools related to particular blockchain functions, such as Ethereum’s use of Dapps and DAOs.

While memecoins offer traders an opportunity to make large amounts of money in short periods of time, they are also highly volatile and unstable. As such, they should be approached with caution.

Here’s what you should know about memecoins, how they became popular, the risks and how to buy them yourself.

What is a memecoin?

So, what exactly is a memecoin? Memecoins – AKA “shitcoins” — is a cryptocurrency created and promoted around a popular internet meme or cultural trend. The appeal of memecoins lies in their fun and cheerful nature, as well as their potential for significant profits.

Memecoins are often created as a joke or a way to mock the serious nature of traditional cryptocurrencies, but they can still have significant value if they catch on. This has led to a large increase in trading and investing in memecoin, with some investors seeing great returns.

What are some examples of memecoins?

Two of the most popular memecoins are Dogecoin and Pepe Coin. Dogecoin was started as a joke in 2013 by Billy Markus and Jackson Palmer, but it has since grown into a significant player in the cryptocurrency space. In May 2021, it rose to an all-time high of around $0.74, with a market capitalization of over $80 billion at its peak.

Inspired by the popular internet character Pepe the Frog, Pepe Coin recently made headlines when it reached a market cap of $1 billion and entered the market’s top 100 cryptocurrencies – all just three weeks after launch. The contract for the token was distributed by an anonymous user and initially became popular through posts on it official Twitter.

Other notable memecoins include Shiba Inu (SHIB) and Akita Inu (AKITA).

Why are memecoins so popular?

One reason for the recent popularity of memecoins is the rise of social media and internet culture. Memes have become a significant part of online communities, and memecoins are a natural extension of this trend. The rise of Reddit communities, Discord channels, and other online forums has made it easier than ever for memecoins to gain traction and attract investors.

Another reason for the popularity of memecoins is the desire for quick profits. While other coins like Ethereum and USDC can take time to increase in value, memecoins can see significant gains in a short time. According to Watcher Guru, if someone invested $1,000 in $PEPE on April 17, 2023, their tokens would be valued at $36,541 by May 3.

How to buy memecoins

Certain memecoins are not listed on exchanges. As a result, buying them can be difficult for those new to the space. Fortunately, the process of buying them is pretty much the same from coin to coin. To illustrate, we use $PEPE as an example.

First, make sure you have a wallet like Metamask or Coinbase Wallet. Then, if you don’t already have any, you can buy Ethereum or transfer it to your wallet via another exchange. After you have the amount you want to exchange in ETH, open Uniswap.com and connect to your wallet.

Copy and paste $PEPE’s token address 0x6982508145454Ce325dDbE47a25d4ec3d2311933 and select Pepe Coin. Double check to make sure you have the correct coin and sign the transaction. Then enter the amount of ETH you want to exchange and the amount of $PEPE will be displayed. Click “Swap” and sign the transaction.

Then, after a few moments, Pepe Coin should be in your wallet.

The same process applies to different memecoins; all you need to do is exchange the token’s contract address. For example, if you were to buy $TURBO, you can access the contract on etherscan.

Alternatively, certain memecoins, such as $SHIB or $DOGE, can be purchased directly on exchanges such as Coinbase. Likewise, you can buy $PEPE through OKX or Binance.

Risks and concerns

Ready to buy? Before doing so, it is important to remember that while memecoins can lead to quick profits, they are also prone to sudden price fluctuations. This can make them risky investments and may not be suitable for everyone, especially those who are risk averse.

For every story you hear about someone making hundreds of thousands on a memecoin, there are also others who have lost large amounts but just don’t announce it on social media. In a thread of NFT_Doctor33dozens of traders chimed in with their losses to demonstrate that the crypto space is not only about constant gains and victories, but also setbacks.

As these memecoins continue to develop, it will be interesting to observe their impact on the broader cryptocurrency market. Whether coins like PEPE maintain long-term success or eventually give way to another trend, they have already secured a place in NFT history as a significant contributor to the crypto ecosystem.