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February 4, 2025 by Usman Zafar
- Memecoins stress-tested blockchains, driving innovation and resilience.
- They helped onboard more users to on-chain ecosystems, fostering adoption.
- DEXs now rival CEXs in volume and price discovery, with memecoins playing a role.
Ignas, a well-known DeFi commentator, recently took to X to reflect on the legacy of the memecoin mania that took over the crypto space. According to him, while crypto bubbles are predominantly fueled by gambling, wasting resources, and speculation, there’s a small silver lining: the remaining 5% that contributes to true innovation. The rise and fall of memecoins are a prime example of this trend.
Memecoin mania legacy is ugly.
Crypto bubbles is 95% gambling and wasting resources, but the remaining 5% fuels innovation.
• Most ICO tokens died but Chainlink, Filecoin, Brave browser survived
• DeFi summer yield farming ponzis gave us Aave, Compound, Yearn Finance,…
Memecoins: Value Extraction, Not Innovation
Memecoins have largely been seen as a way for early adopters to extract value with little to no meaningful contribution to the crypto ecosystem. However, Ignas notes that these tokens did, in some cases, test blockchains under pressure.
Coins like Dogecoin and Shiba Inu may not have added much value, but they did expose weaknesses in networks like Solana, including flaws related to low-float, high FDV tokens. Despite this, they left behind no significant innovation of their own.
The Role of DeFi in the Evolution
Its mania has undeniably played a part in shaping the decentralized finance (DeFi) landscape. While the ICO boom and DeFi summer were riddled with ponzi schemes and scams, they ultimately gave birth to successful projects like Aave, Compound, Yearn Finance, and Uniswap. By contrast, it seem to have only led to value extraction and offer little in terms of actual innovation. Still, they served a critical function in testing DeFi’s scalability and resilience.
Memecoins: A Controversial Future
As the memecoin controversy rages, a part of them have a rosy future in store, in their view. With a fair launch mechanism, a part of the coins, specifically ones that have been started on Bitcoin (e.g., BRC-20 tokens), have been developed, in their view.
Sir I got rekt on Runes
I though they would pick up because of their novelty
But Bitcoin is too slow and expensive. Degens want to know if they lost or made money.
Rune slow trading lead to low volumes and CEXs seeing such low volumes didn't list them
This is seen as a potential direction for equitable token distributions, in contrast with memecoin pumpphony and dumpculture. Moreover, these coins brought in users onto on-chain culture, teaching them about wallets, DEXs, and bridges.
Others, however, have an opinion that memecoins will make a lasting contribution in the crypto community, even when near-term ramifications will appear to have a damaging impact.
A Modest Yet Lasting Legacy
While it’s hard to imagine memecoin madness being nostalgically seen in years to come, its presence cannot be refuted. What will mold the future of crypto, nevertheless, is lessons learned, testing of blockchains, and growing use of decentralized technology. These coins madness, in its ugliness, prepared a future for a strong and decentralized environment.
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