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Are Memecoins the New NFTs?

By Evan Jones05/01/2024

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During the last bull run, non-fungible tokens, or NFTs, were the hottest assets within the cryptocurrency sector. Owning a Bored Ape Yacht Club (BAYC) NFT, a CryptoPunk NFT, or a team of Axies to play Axie Infinity meant that you were likely experiencing significant gains in your portfolio. While these NFT projects haven’t died completely, they certainly aren’t even close to as prevalent and popular as they were in 2021. 

Memecoins like Dogecoin (DOGE) and Shiba Inu (SHIB) didn’t exactly do poorly during that bull run either, as they saw their all time highs during that time. But since then, more memecoins have been popping up and making headlines, leading many to wonder if memecoins are the new NFTs. Will they be worth holding onto, or should you consider taking profits like many who had valuable NFTs should have? Let’s dive in. 

Memecoins vs NFTs

Fundamentally, memecoins and NFTs are very different. Memecoins tend to have an enormous supply of tokens, while NFTs are individual, unique tokens. The only real similarity between the two is the use of some sort of identifiable art as the image for memecoins, such as Pepe for PEPE, or the Dogecoin Dog.

What makes people compare memecoins to NFTs is their ability to quickly generate and foster a community around a project. Memecoins projects often have vehement supporters just like the bigger NFT projects did, which gives more strength/stability to the price than otherwise. 

Flash in the Pan?

Though the NFT projects mentioned in this article thus far are still alive and have sales, they aren’t close to comparable to what they were at their peak. NFTs weren’t exactly the best ideas as long-term investments, at least in the form of pixel art images. Anyone who had a BAYC or CryptoPunk and sold is likely a lot happier than someone who either held or bought one to flip only to watch the value fall over the past few years.

Could memecoins suffer the same fate of a fast rise in value only to never reach those levels again? It certainly seems possible. However, when you look at the recovery of Dogecoin and Shiba Inu in 2024, it may not be as easy to dismiss memecoins as a flash in the pan as certain NFT projects can be.

Why Memecoins Are Better than (Art) NFTs

Though it’s possible that many, if not all, memecoins could end being losing investments over the long term, the original ones have shown some resilience. Dogecoin, despite being down many exponentials from its all time highs, is still at a higher price than likely anyone would have expected before 2021, as it’s still trading around 14 cents US in 2024 despite having spent the first seven plus years of its existence trading at less than 1 cent. Shiba Inu (SHIB) is a similar story though with a shorter timeline.

Overall, memecoins are better than art NFTs because they have more utility than an NFT. Though some NFTs may provide a user various benefits, they aren’t easily tradeable or convertible into another crypto asset unless you find a buyer or want to sell under market. 

Work is being done on the Dogecoin ecosystem while the Shiba Inu developers have long stated their desire to create a SHIB ecosystem and already have various components such as a decentralized exchange.

Closing Thoughts

NFTs and memecoins have experienced similar rises to relevance in the cryptocurrency sector, but other than their status as hot topic buzzwords for mainstream media and new participants, they aren’t very similar at all. While neither is guaranteed to be a good long term investment, the communities that surround memecoins, and the general ability to use memecoins for a variety of purposes, makes them distinct from NFTs. Just remember that buying either is a gamble that could end up being a losing bet.

Article tags

cryptocurrency
investing
memecoins
NFTs
Evan Jones

Author

Evan entered the crypto scene in 2017, attracted to the many disruptive possibilities that blockchain could have on current world systems. He has a keen interest in decentralized services, payment processing, and viable NFT use cases such as event ticketing. He spends his days writing with his dog Kobe under his feet, if not on his lap.

Further reading

What’s the Best Way to Deal with Extreme Fluctuations in Crypto? image
What’s the Best Way to Deal with Extreme Fluctuations in Crypto?07/04/2023
Why Do Gamers Hate NFTs So Much? image
Why Do Gamers Hate NFTs So Much?10/03/2023
What’s the Best Hands-Off Approach to Investing in Crypto? image
What’s the Best Hands-Off Approach to Investing in Crypto?04/03/2024
DOGE, SHIB or Bonk? What Meme Coin Has Performed Best in 2024? image
DOGE, SHIB or Bonk? What Meme Coin Has Performed Best in 2024?04/19/2024

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