Messari: Memecoins kill retail investors
TechFlow Selected TechFlow Selected
Messari: Memecoins kill retail investors
Memecoins are a zero-sum game, where value is not only redistributed but also destroyed.
Navigating Web3 tides with focused insightsAuthor: Mike Kremer, Data Engineer at Messari
Translation: 0xjs, Jinse Finance
Since the ICO boom, the meme coin craze may be the most predatory phenomenon in crypto. Unlike previous cycles—where tokens were typically backed by real projects with tangible value—the rise of meme coins marks a shift toward a more destructive dynamic. To understand this, let’s compare the value flows during DeFi Summer to what we see today.
During DeFi Summer, projects like Uniswap Labs launched protocols that provided genuine utility to the crypto economy.
Users participating in these platforms typically received token rewards—tokens representing a share of the value created by the protocol. When the speculative frenzy faded, these tokens still held underlying value because they were tied to functional, valuable services.
Contrast this with the current meme coin trend.
Here, insiders or cartels create tokens like supercumrocket69, hype them up, and lure retail investors into bidding on these "revolutionary" new assets. Once prices rise, the insiders dump their holdings, effectively extracting wealth from retail participants and leaving behind tokens with no real value or utility. The entire process is a zero-sum game—value isn't just redistributed, it's destroyed.
The impact on retail investors is clear. Look at projects like Friend.Tech and Ore Supply.
Despite implementing retail-friendly distribution mechanisms—FRIEND was fully airdropped to its community, ORE mined via a fair CPU-based algorithm—both tokens have seen massive price depreciation.
This shows that retail buyers have been ruthlessly drained by meme coins, leaving them without capital to support the market caps of more legitimate projects. Meanwhile, meme coins survive at best through questionable market activities and retail naivety.
The sad truth is that while speculative bubbles have always been part of crypto, they previously left behind some residual value in the form of legitimate projects. However, the meme coin bubble is purely speculative, draining value from the ecosystem and leaving retail investors worse off than before.
Disclosure: The author suffered significant losses on FRIEND and is now experiencing substantial losses holding and mining ORE. This article was inspired by personal financial loss and the widespread frustration among meme coin sellers and buyers.
Join TechFlow official community to stay tuned
Telegram:https://t.me/TechFlowDaily
X (Twitter):https://x.com/TechFlowPost
X (Twitter) EN:https://x.com/BlockFlow_News
Messari
