NFTs vs Memecoins in Community Building

Despite the memecoin culture, Pudgy Penguins CEO Luca Netz stated that NFTs are unparalleled in creating community engagement during the Solana Breakpoint conference in Singapore.

“With memecoins there isn’t this profile picture in which you can easily identify on the internet, somebody that shares [your] values, and it’s almost like a chain reaction effect that I think only NFTs can create,” Netz emphasized. He highlighted that NFTs carry a symbolism that memecoins cannot replicate.

Netz explained that NFTs have a hierarchical structure distinguished by price and period of purchase, symbolizing power and status within the community. “[Holders] want to be, the word I want to say is not appropriate, but like the top dog in the room,” he stated.

While the NFT market has seen a significant downturn since its peak in early 2022, where monthly sales volume reached $17 billion, recent figures from CryptoSlam show only $347 million in volume over the past 30 days.

In contrast, memecoins have surged as the leading cultural and community force in Web3, with Solana’s memecoin market cap now at $7 billion and $1.82 billion traded in just the past 24 hours, according to CoinGecko.

Netz acknowledged the prevailing concerns regarding the declining NFT market. He noted, “Why I think NFTs are seeing a bad time at the current moment is, I think the successful NFTs are too illiquid for whales and priced out of retail.”

However, he remains optimistic, stating that crypto operates in cycles and that NFTs will emerge even stronger in the next round with improved infrastructure built since the previous cycle.