“Zoo” sucks blood, Meme coin “disenchants”

After several adjustments, the mainstream currency began a slight correction yesterday. Unlike all the previous ones, in the analysis of the reasons for this correction in the community, most people mentioned the “zoo blood sucking” boom.

The “zoo” series of currencies have occupied the center of recent market public opinion. In just a few months, the Meme currency represented by Dogecoin has become a part of the diverse culture of the crypto community.

Under the spread of emotions, Dogecoin’s “Imitation” SHIB has increased by 530 times in the past 30 days, and at the same time it has logged on to trading platforms such as OKEx and Huobi, and the popularity remains high.

At the same time, various altcoins derived from “animals” and “stalks” were also exploding. In the non-small cryptocurrency market platform, in the “Dogecoin Concept” section, altcoins such as Akita (AKITA), Pig Coin (PIG), Dog Coin (DOG), Loser Coin (LowB) have been listed Into it.

Due to some extremely gimmicky currencies represented by SHIB, some investors have obtained several times, dozens of times or even hundreds of times the book income, and market sentiment has been magnified again by FOMO sentiment.

Innovative DEX meets copycat Meme outbreak season

Under the influence of technological innovation, the currency issuance process has been simplified again.

In peer offerings, fundraising is always one of the most important parts. In the innovation brought by DeFi to the market, the decentralized issuance method of IDO (Initial DEX Offering) has become a turning point. Through IDO, Token issuers use the on-chain decentralized platform to raise funds without permission and marketization.

In the previous IDO releases, Uniswap, Balancer, Polkastarter, etc. are all unique IDO platforms.

On the well-known Uniswap platform last year, after developers created ERC20 Token on Github, they can log in to Uniswap for currency listing and pricing in the next step. Any project can open a new fund pool, and users only need to have a chain that does not need to be reviewed. Wallet and principal (digital assets) can be exchanged for new coins on Uniswap, and the threshold for issuing and listing coins has been greatly reduced.

This method bypasses the various audit and participation thresholds that were previously strictly limited to exchanges. According to the documents, IDOs at this stage, developers and users’ participation on the chain, still need to update the code, technical experience, and technology. The threshold is compressed. At the same time, this method has tested the user’s ability to identify projects and risk tolerance.

With the further improvement of the DeFi infrastructure, the current development tools available to developers have been further updated, and the “coin issuing” has been compressed to the “minimalist model” again. Blocklike noticed that a quick token issuance strategy sparked discussion in the community. This strategy showed the whole process of decentralized currency issuance under the “minimalist model” and triggered many investors to try it.

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The platform mentioned in the guide is the currently well-known decentralized trading platform DODO as an example. On this platform, the entire process is briefly summarized into two steps, namely: input token parameters to issue tokens and add liquidity.

In addition, due to the recent fire in the Meme currency, the first step in the “Strategy” is defined as: writing a good story.

There are many such extremely simplified “one-stop” currency issuance platforms, including BSC, HECO, etc., which gradually reveals the latecomer advantages of smart public chains and innovative DEX trading platforms.

Taking the BSC smart chain as an example, the platform also provides a “one-click currency issuance tool” to reduce the difficulty of operation and attract developers to participate and project parties to transfer. From the data provided by EherScan, in late April, the daily transaction volume of BSC once rose to 5 times that of Ethereum, and PancakeSwap’s daily transaction volume of more than 2 million BSC became one of the main reasons for promoting the daily transaction volume of BSC.

The continuous influx of users has also made the platform the first choice for many developers to issue Meme coins.

On May 10, when trading platforms with a large number of users such as Matcha and Gate launched altcoins such as Lowb and PIG, the platforms experienced varying degrees of downtime due to excessive traffic. At the same time, because many “animal” altcoins were basically built on BSC, there was serious congestion in BSC at that time, and a large number of transactions could not be executed.

With the rapid development of many platform technologies, if Uniswap has greatly reduced the threshold for issuing and listing, then many innovative DEX trading platforms have once again reduced the language, interaction, user habits, and cross-platform details. The problem is that the “one-stop” method of issuance allows more people to participate in it at a lower threshold. Technology inclusiveness is one of the directions for all platforms at this stage.

With the gradual improvement of the DeFi ecological infrastructure, the currency issuance process has been simplified again. If you want to issue your own Meme currency, the whole process takes only 5 minutes. Under such circumstances, the endless stream of “animal” imitation plates and cottages may have gradually deviated from the track of normal project operation.

“Zoo” or the warning signal is now

Meme is currently widely understood as “stalker” or “dictionary”. Dogecoin has shown more and more people in the market: the idea of ​​spreading in the community, as well as the recognition of a certain shared subculture or the recognition of reality , Can generate tremendous power. The marketing of the Meme currency defeats technology.

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Under this circumstance, when the minimalist currency issuance process meets the outbreak season of the “Altary Meme” currency, the new Meme currency that users pay attention to and actively snapped up in the community every day is likely to be caused by unknown developers in just 5 months. A real “joke” made in minutes.

The community has also heatedly discussed the “Quick Issuing Strategy”. Due to the low cost of issuing coins, project insiders with a large number of tokens may not have long-term management ideas for projects that only take a few minutes to create.

Some analysts pointed out that although the “currency issuance” process has been greatly reduced, the biggest problem facing the Meme currency is how to make the currency recognized and how to make the issued currency have long-term value. After the FOMO sentiment ebbs, some Meme currencies are likely to become the carnival of a small number of early gainers. Even if the issuer uses the most common airdrop method for publicity, the consumed ETH Gas fee is far greater than the Token issuance cost. How does the project value reflect?

If Dogecoin is a Meme currency that has withstood the test of time, but the hottest batch of currencies following the trend has not. From an investment perspective, the Meme currency has benefited the most from the first batch of participants. Under the circumstance that the quality of the issuer or the team cannot be guaranteed, most of the investors who bought “small animals” in the middle and late stages are now Give birth to a new batch of “casinos” in the market

The influx of fake Meme coins into the market is not an optimistic phenomenon. This kind of “animal” currency speculation model, which is gradually going crazy, has evoked many investors’ memories of the previous round of bull market.

The influx of Meme coins started the Dogecoin boom from March to May 2020. This time period is associated with the altcoin boom in 2013, the 1CO boom in 2017, and the DeFi boom in 2021.

Looking back at the 1CO period in 2017, the method of issuing coins in the white paper broke the traditional fundraising methods, but what followed was the explosion of air coins, MLM coins, and capital markets. In 2020, the emergence of innovative DEX such as Uniswap has once again reduced the difficulty of listing for emerging projects, and finally a large number of “earth dog”-style low-quality projects have appeared. Even now, the Meme currency is even reduced to a “story” or “joke”. The risks behind it will inevitably intensify, and the farce of “Drumming and Passing Flowers” will still be staged.

Wu said that the author of the blockchain, Colin Wu, compiled and analyzed the similar logic that can be followed in the current animal frenzy:

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1. Do not make any innovations in technology, plagiarize the open source code of existing mature projects;

2. The community community is the core, and various communities are spreading wildly. Except for a very small number of communities such as Lowb, which has a community culture, the others rely on the effect of making money;

3. Waiting for the exchange to go online, the project “turns positive” and the price bursts. (The exchange is the last and most important link, and even collusion between the exchange and the project party is not ruled out)

Among many viewpoints and analyses, various types of “animal coins” have become popular, and they have already had a blood-sucking effect on mainstream coins such as Bitcoin. In this pull between the zoo and mainstream currencies, BTC’s current decline has been supported. Although the market outlook is still unclear, there are signs that funds may begin to return to mainstream currencies.

According to Gate.io global transaction data market analysis, the current market is still in a high range of fluctuations. BTC has not yet risen above the US$60,000 mark. The main reason is that popular small currencies such as SHIB are further absorbing funds in the market, and there is still a risk of correction in the short term.

In any case, the exaggerated development of the “animal coin” hype has already given the entire market a sign of vigilance. Fair issuance and lower thresholds have brought innovations in business models to the market, but have also led to increased reproducibility. At present, the more abrupt follow-ups, the more market feedback has shifted. Some analysts believe that once the imitation of animal coins blows out and the amount of retail funds is limited, market funds will be quickly diverted, and the wealth-making effect will disappear. The sustainability of animal coins that are pushed to high prices is difficult to maintain, and investment is still needed. Be more cautious.

Author/ Translator: Jamie Kim
Bio: Jamie Kim is a technology journalist. Raised in Hong Kong and always vocal at heart. She aims to share her expertise with the readers at blockreview.net. Kim is a Bitcoin maximalist who believes with unwavering conviction that Bitcoin is the only cryptocurrency – in fact, currency – worth caring about.