The Solana blockchain has emerged as a center for the launch of new memecoins as the latest bull market takes off, with several of these memecoins quickly reaching market capitalizations in the billions of dollars within days of their release.
One particular memecoin that has caught the attention of the crypto community is Slerf. The creator of the project accidentally burned over $10 million in Solana tokens before the launch. Despite this setback, the memecoin was still launched successfully and reached a market cap of $500 million within hours.
A developer who raised 535,000 SOL tokens to launch a memecoin with the same name revealed that they mistakenly burned $10.4 million worth of Solana tokens while attempting to clear their wallet.
The memecoin frenzy has drawn comparisons to the 2017 Ethereum initial coin offering (ICO) bubble, where numerous crypto projects raised millions of dollars but failed to deliver on their promises.
Memecoins are cryptocurrencies that originate from internet memes or possess other humorous characteristics. However, they lack any real-world use case aside from being a reference to pop culture. These cryptocurrencies are highly speculative and are supported by enthusiastic online communities.
Dogecoin (DOGE) is considered the original memecoin and gained support from Elon Musk during the 2021 bull market. In 2024, several memecoins, some of which are only a week old, have achieved market capitalizations in the billions, creating new crypto millionaires at a rapid pace.
The recent comparison to the ICO presale era of 2017 comes as many influencers manage to raise millions of dollars in presales to launch new memecoins.
Users on X, a platform, compare the current memecoin offerings to the Ethereum ICO bubble in 2017, where several crypto projects made promises but disappeared after raising funds. A report from 2018 indicated that over 90% of ICO projects failed.
Similarly, there have been instances where influencers have absconded with the presale funds or immediately dumped them on the market after the launch.
One user on X remarked that the memecoin mania is a more transparent version of the 2017 ICO craze and the 2021 nonfungible token/crypto-art bubble, as projects no longer have to pretend to deliver on a fake white paper and investors no longer have to pretend to be interested in the art.
Stories of a few traders making millions of dollars in just a few days often inspire many others to try their luck. However, more often than not, these individuals end up losing a significant portion of their investment.
Crypto enthusiasts argue that the memecoin bubble will eventually result in the loss of funds for many new users who blindly invest in technology that lacks utility.