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Do traders still make millions with meme coins?
Meme coins still bring profit, but not for everyone. Investors told crypto.news how much they managed to gain from the meme coin hype.
Meme coins posted an astonishing return of 1,313% on average in the first quarter. And this industry does not even think about stopping its growth, bringing traders millions of dollars in profits.
Source: CoinGecko
Huge positive price waves within days or weeks are natural. But what is it?
What are meme coins?
Meme coins they are a type of cryptocurrency whose popularity is directly related to Internet memes and viral marketing on social networks. Typically, they are initially created as a joke without any practical function.
The first and most famous token was Dogecoin (DOGE), launched in 2013 based on the popular Shiba Inu dog meme. DOGE was initially supposed to be a parody of Bitcoin (Bitcoin). However, over time, this business has gained a capitalization of billions of dollars.
The main difference between meme coins and traditional cryptocurrencies like Ethereum (ET) or Bitcoin is the lack of intrinsic value and restrictions on emissions. Their cost depends entirely on demand in the context of the Internet boom, and for this reason, meme coins are characterized by increased volatility.
However, recently, there has been a tendency to give meme coins greater practical significance. For example, the developers of Shiba Inu (SHIB) and FLOKI are creating their own metaverses, NFT platforms, and educational ecosystems based on these assets.
Millionaire profit: this year’s trend
The number of meme tokens issued grows with enviable regularity and traders manage to earn fortunes from them. However, such success is usually short-term and random. In the long term, as the popularity of the Internet declines, the value of most meme coins tends towards zero.
Allegedly, those who make millions of dollars with meme tokens have inside information. Otherwise, how would these traders and investors know that the prices of some meme coins would show rapid growth? The crypto.news editorial team spoke to traders who could make profits on condition of anonymity.
Frog investments
Members of Pepe (PEPPER) the crypto community is celebrating the frog token’s new all-time high. In all this, one user claimed to have turned just $90 into $1.4 million thanks to PEPE.
As of mid-April 2023, a trader purchased nearly 6.5 trillion PEPE Uniswap trading cryptocurrencies just for fun. Since the initial investment amount was small, the trader did not sell the tokens and decided to observe what would happen with them.
This decision turned out to be the most correct: in May 2024, 6.5 trillion PEPE made the anonymous trader a dollar millionaire. However, a user with the nickname Mina said that she does not intend to sell PEPE and now believes that one day the price of the frog coin will exceed 1 dollar.
“Sometimes I want to sell my PEPE, but I keep it to remind me not to rush. The meme coin market is not done conquering the heights yet, and my PEPE is likely to make me a billionaire in a year.”
Mina, anonymous trader
Strong trust in dogs and love of hats
A trader from the Telegram meme coin community shared an impressive story of earnings on Dogwifhat (WIFE) currency. However, this case is different from the inspiring stories of traders whose coins grow 1000 times in an hour.
The anonymous trader used a different strategy: HODL. He purchased WIF in December 2023 and analyzed the overall activity on the Solana network and the growth prospects of the cryptocurrency market.
After weighing all the risks, the trader purchased tokens worth around $500, expecting further growth. As a result, he made about $15,000 simply by keeping the assets on the balance sheet.
“I’ve heard stories of traders making billions of dollars from just $100. However, as an active participant in the crypto community, I find these stories to be the exception to the rule. The meme coin market is still very opaque and confusing, so inspiring stories about traders are probably simply insider trading.”
Member of the meme coin community
More conservatism
Another member of the crypto community with the nickname Andilet urged caution when investing in meme coins and shared his strategy for diversifying assets. He recommended dividing the crypto portfolio by risk level, with 10% of the portfolio made up of volatile and high-risk coins, including meme coins.
Despite the high risk, allocating part of the portfolio to meme coins seemed appropriate since meme coins are more likely to provide significant profits.
“In general, it is difficult to predict in the long term how the meme coin market will behave, because in memes everything depends heavily on hype, the level of which is also difficult to predict.”
Andilet, investor of SHIB
He invested in Shiba Inu in the summer of 2023, spending approximately $5,000 to purchase coins priced at $0.0000077. Now, with a SHIB rate of $0.000025, his estate is worth about $50,000.
“I believe that in the case of meme coins, an individual approach to each project is important. You can guess the short and medium term trend by studying the project closely.”
Andilet, investor of SHIB
In summary: to invest or not to invest?
Investing in meme cryptocurrencies represents considerable risk. This can bring a solid profit due to speculation, successful exit times and a complete capital loss. The main thing is to monitor social networks, read the news, be able to search for information, and the first time a media personality mentions a meme coin, try to get it.