Memecoins and Their Future in the Crypto Market

"Memes have existed since the beginning of man, scratched on cave walls," declared Mike Dudas, founder of 6th Man Ventures, at The Block's Emergence conference in Prague during a panel discussing the current state of memecoins.

The Longevity of Memecoins

Each panel expert agreed that memecoins are unlikely to disappear from the crypto market anytime soon, although they debated whether memecoins should market their utility, potential competing ecosystems to Pump.fun and Solana, and how to evaluate a memecoin's long-term success.

Chris Newhouse, Director of Research at Cumberland Labs, stated, "Being able to add utility to memes and generate revenue off the back of [memecoins]…is a factor that can’t be overlooked."

On the contrary, Genia Mikhalchenko, leading business development at Douro Labs, said, "Utility is turbo-bearish…people aren't using discounted cash-flow models when they buy a picture of a hippo or a frog."

Mikhalchenko mentioned outliers like BONK, which he described as having "party in the front, business in the back", successfully utilizing its protocols to enhance the memetic value of the token.

Dudas queried token founders, "When you launch a token, is it going to trade on fundamental value or memetic value?" He preferred the answer indicating a strong initial memetic value followed by utility development over time.

Nicolai Søndergaard, a researcher at Nansen, noted, "Not every meme makes a good memecoin. For long-term popularity, a meme must be shareable and alterable."

Future Competition: Will Pump.fun and Solana Be Dethroned?

The discussion shifted to potential dominant blockchain networks in the memecoin space. Chris Newhouse pointed to Base as a competitor to Solana.

"Base is where a lot of the next wealth effect is going to be, particularly the AI-driven stuff, which is a pretty hot narrative now," said Newhouse.

K33 Research reported that AI-driven token generation tools, like Clanker, seamlessly integrated into Coinbase’s infrastructure, are facilitating Base's success and activity similar to Solana’s Pump.fun platform.

Mike Dudas noted Base still has hurdles to overcome, mentioning it lacks a sufficient number of tokens to compete effectively. However, he believes Base will eventually become a competing chain.

Recent data from The Block revealed Solana accounted for around 348,000 of the 375,000 new tokens launched across all tracked chains in November, indicating Solana’s strong position in the token creator space.

Base's Total Value Locked (TVL) recently surged to $3.89 billion, reflecting significant growth and the attraction of funds from other layer-2 networks, while Solana also experienced net-positive inflows, posting a TVL rise to $9.32 billion over the past month.