Author: MONK
Compiled by: TechFlow
1. $DOGE -> Medium-sized Market Cap Meme Coin Rotation
In my opinion, the performance of meme coins cannot be separated from DOGE. With the election approaching and $DOGE receiving renewed attention, I thought it would be interesting to analyze how the value in the meme coin category is dispersed. Here are my thoughts. Discussion follows:
2. I think it is increasingly difficult to drive Meme coin market share without a significant rise in $DOGE/$SHIB. In 2024, the total market value of the overall Meme coin market has risen sharply and is close to the historical high (ATH) in 2021:
3. Most of the value growth this year came from the explosive growth of non-$DOGE/$SHIB Meme coins. Currently, the market dominance of DOGE and SHIB has dropped to about 57%:
4. Despite this, Memecoin’s market share in cryptocurrencies is still lower than when $DOGE reached its ATH in 2021. The impact of DOGE cannot be ignored. This week, the total market value of the asset increased by $7 billion, which is basically equivalent to one $PEPE + $WIF.
5. I think the outlook for $DOGE is interesting even without new retail interest. I expect $DOGE/$SHIB dominance to gradually recover. There is a lot of capital sitting on the sidelines in this meme rally...
6....These are the middle investors who are skeptical of the legitimacy, sustainability and impact of this category. Or they may not want to participate in low liquidity and high turnover transactions. Therefore, many failed to seize the opportunity of $WIF, $PEPE and $BONK.
7. However, sentiment regarding meme coins has changed significantly. Interest in this category is now much greater than it was a few months ago, with the $GOAT coverage being a good example. Even self-proclaimed intermediate investors are starting to change their tune:
8. I think these players could be bidding for another rally in $DOGE. This is the trend I see driving meme coins and crypto market share to new heights. Any news could be a catalyst, whether it’s a new government agency, Elon Musk, Trump, or something else.
9. Most of the funds may come from other crypto fields. Retail investors may be helpful because I think $DOGE is even more recognized than $SOL in the minds of ordinary people, but the current liquidity environment has changed significantly compared to 2021.
10. So, what happens after $DOGE bounces? I think any strong move in $DOGE/$SHIB will bring additional value to the new "Meme Coin Middle Class" and unlock potential for assets like $WIF, $PEPE, and $POPCAT.
11. For intermediate investors, the relative attractiveness will be higher. $WIF will be more attractive when $DOGE has a market cap of $100 billion, not $30 billion. As the number of meme coins with investable assets above $1 billion increases, the risk-return ratio of stablecoins will also look less attractive in this post-$DOGE scenario.
12. As Meme coins gain greater recognition as a space, the theory of middle-class re-rating will also attract new potential buyers. These assets ($PEPE, $WIF, etc.) are more liquid, less volatile, and easier to manage than small-cap coins.
13. They also have greater upside potential after $DOGE rebounds, and I think intermediate investors will eventually seize the opportunity and bid the prices of these assets higher, which is necessary in the current situation. I don't think $PEPE can reach a $10 billion market cap in a stagnant $DOGE market.
14. Therefore, consider $DOGE as the $BTC in the meme coin, and further gains in assets such as $PEPE, $WIF, $POPCAT need to come before $DOGE rebounds. I think there is no obvious benefit to stablecoin investors, and small-cap coins are still in the rotation stage because the entry barrier is still high.
15. I also see some potential for the middle class to upgrade to large-cap stocks ($PEPE has basically reached this level). Capital will naturally be disproportionately concentrated in large-cap assets because investors are mostly lazy and like to look for confirmation bias.
