Building real-world projects using meme-inspired strategies

For most of 2024, crypto markets were maintained by trading memecoins. According to CoinGecko, memecoins will be the most popular cryptocurrency in the second quarter of 2024, accounting for 14.3% of the market share. The numbers were very similar in the first quarter. These cryptocurrencies rely on fun communities and a brand of humor known as memes to attract users and traders. Through these memes, people from all walks of life can come together for a common goal and jokes, with the promise of monetary rewards by trading memecoins.

The market capitalization of memecoins — more than $50 billion as of October 8 — shows how massive and fast meme-inspired communities can grow. The lack of centralization in the niche makes the community unique proponents of blockchain technology. These communities ride on the back of their representatives' tokens and go viral within minutes as fuel. Most of these tokens are traded internally, which results in a large amount of pumping and dumping. And as the noise subsides, the community begins to quiet down.

Over the past couple of years, the influence of meme-inspired communities has grown exponentially. And they highlight the obvious power of an active community behind projects. A crypto project with real-world utility has a relatively high chance of going viral if it has a strong community like those in the memecoin ecosystem.

Related: Pick up memecoins – you won't fuel the next bull run.

The best crypto companies and projects should be built on the back of meme-inspired communities and projects. In the following paragraphs, I will explain how this strategy works.

Using hype for growth

At the heart of meme-driven communities and their rapid expansion is the presence of heavy humor, herd mentality, celebrity endorsements, and massive FOMO. Communities like Dogecoin, Shiba Inu, and most recently PEPE have seen huge growth because of these features. After an influential person publicly endorses or validates Memecoin, the fear of missing out on the opportunity to make a quick profit (FOMO) often results in investors abandoning the project as a blanket. These supports provide legitimacy and excitement to these memecoins and their communities, creating and sustaining a meme-inspired hype.

Influencers and celebrities use their popularity through social media to gain interest in memecoins. Elon Musk has repeatedly tweeted about Dogecoin, causing its price to reach record highs. In the year This year we've seen celebrities like Iggy Azalea, Jason Derulo, and Hulk Hogan publicly talk to their followers about mom, Jason, and HULK. In most cases – as mentioned above – these memecoins end up as pump-and-dumps. Take the ORC coin, for example, memecoin, endorsed by crypto fame DaVinci Ermey, which is widely recognized in 2011 when it bought Bitcoin for less than $1. No resource, no real story. As a result, the project has been stalled for some time.

Celebrity endorsements lead to strong meme communities, which will do wonders for the project, especially in the short term. As the community grows, its visibility increases, and other investors and backers/supporters join. The more people in the community, the higher the number of users investing in the project. At its peak in 2021, approximately 3.6 million addresses will hold DOGE. In just over a month since its launch, SUNDOG has amassed nearly 150,000 followers on social media, with a market capitalization of $339 million. The project has a 99% positive vote in the Community Trust Department's decentralized research and trading platform DEXTools. This represents the community's trust in the project. NEIRO is another such project with an amazing community. Above all, it's brand loyalty. In the short term, with no real utility, these memes create a user-to-meme connection that goes beyond profit. This kind of brand loyalty cannot be bought.

Transforming memecoin communities into strategic launchpads using vampire attacks

I know the obvious question here is: What is a vampire attack?

A vampire attack is a technique used by a new crypto project to extort users and to extort funds from the project that controls its position. In most cases, the latest project is usually a fork of an existing project and attracts users by offering a better user experience, improved product/service, higher financial incentives and better benefits. This aggressive project can develop growth strategies from where it can exploit competitive advantages.

Examples of some popular protocols that have faced vampire attacks include OpenSea, Uniswap, Cream Finance, etc. By 2022, OpenSea is the industry's leading NFT marketplace while LooksRare, another NFT marketplace, begins to attack its users. LooksRare has issued over 120 million LOOKS tokens to active users who had to migrate to LooksRare before claiming free tokens.

In September 2020, Uniswap experienced the vampire attack as Sushiswap tapped Uniswap's open source code to open a decentralized exchange (DEX) platform. To improve on what Uniswap has, SushiSwap has introduced a revenue sharing feature powered by its native SUSHI. Before the attack, Uniswap had more than $1.5 billion in locked assets, which fell to $400 million after the attack, and SushiSwap had $1.35 billion. This damaged Uniswap's position as a leading DEX, so it had to follow in the footsteps of Sushiswap's revenue sharing and launch its native UNI.

Related: Estonia Shows AI-Powered Decentralized Networks Could Change US Policy

A version of this attack can be adapted to start a new project on an existing community activity. Memecoin communities to be exact. Builders in the industry can create memecoin and that meme market instead of directly trying to build a crypto community for their project. Once the community has grown in all important parameters, they can carry out a vampire attack and start a solid project based on that.

This way they can attract a large community to their new project without building from scratch and maintain a high market capitalization. It also provides a better long-term future for memecoins and a way to quickly grow communities for new projects – you could almost say ready.

Building a sustainable project beyond the applause

The next steps are how to build a sustainable project that goes beyond initial motivation.

Emphasis should be placed on developing a project with real-world utility. The project should have a compelling value proposition that involves creating a unique user experience, solving a problem, or providing new features. Tokinomics should encourage long-term engagement while encouraging speculation. Factors such as utility, distribution and mitigation strategies must be considered. A transparent governance system should be established that empowers community members to participate in project decision-making. A clear roadmap should be developed that describes the future activities of the project. This step shows commitment to the long-term success of the project.

Last word

While a meme-inspired strategy can be effective, it is important to consider potential ethical implications such as unfair launches, misleading/misleading marketing, regulatory compliance, and community safety. With a meme-inspired approach, builders can build communities and launch robust Web3 projects, leveraging the power of inspiration and community.

However, this must be balanced against the underlying cost and utility of a sustainable project. By mitigating risks such as competition (the memecoin space is highly competitive) and over-reliance on hype, this strategy ensures the long-term success of your project.

Ivan Lutra is a guest columnist for Cointelegraph and a crypto entrepreneur. At the age of 17, he sold his first company, StudySocial, for $1.7 million, and developed more than 30 mobile applications before he turned 18. In 2014, he got involved in cryptocurrency and is currently building CasaNFT. He has invested in more than 400 crypto projects.

This article is not intended for general information purposes and should not be construed as legal or investment advice. The views, ideas and opinions expressed herein are solely those of the author and do not necessarily represent the views and opinions of Cointelegraph.