While 95% of current cryptocurrency investors still choose BTC, meme coins were quite popular in 2021 and continue to attract investors despite their increased volatility
Since the birth of Bitcoin (BTC) in 2009, the cryptocurrency market has evolved dramatically, giving investors access to more than 20,000 different crypto tokens.
While 95% of current cryptocurrency investors still choose BTC, meme coins were quite popular in 2021 and continue to attract investors despite their increased volatility.
The crypto markets, however, have been in a protracted bear trend since reaching an all-time high in November last year, when it had a market capitalization of over $3 trillion.
Investors might find it interesting to note how various parts of the crypto ecosystem have reacted compared to the larger market.
These categories include Bitcoin (BTC), Ethereum (ETH), altcoins, stablecoins, and meme coins.
Let’s focus on how the top blue-chip tokens have fared in comparison to the biggest meme coins through the prolonged crypto winter.
Bitcoin and Ethereum
BTC and ETH have consistently held the top two positions in the cryptocurrency market, collectively making up almost 60% of the total market cap of all listed cryptocurrencies.
In reality, they have both shown similar price behavior, with BTC and ETH declining by 65% and 63%, respectively, from their record highs (ATH).
Long-term investors would still be sitting on a substantial profit, though, given that both cryptocurrencies continue to trade at levels that are far higher than they were before to COVID.
Every previous bear cycle has had a similar pattern, with both BTC and ETH finally rising to a new ATH.
Tether, USD Coin and Binance Coin
Some unexpected winners may be found in the other three slots of the top five cryptocurrency list.
While Binance (BNB) is a cryptocurrency that is native to the Binance chain, USD Coin (USDC) and Tether (USDT) are stablecoins that are tied to the US Dollar.
Stablecoins now hold the third and fourth positions, which is indicative of their rapid uptake in the cryptocurrency community.
Stablecoins are distinguished from BTC and ETH by their reputation for price stability, and they appreciate in value in tandem with the US Dollar.
In reality, USDT and USDC rise in value in tandem with the US Dollar’s ongoing advances versus a basket of fiat currencies.
Even if Bitcoin, Ethereum, and other altcoins plunged sharply from their November 2021 peaks, the market capitalization of both of these stablecoins increased.
On the other hand, BNB has had a significant price correction, while doing better than BTC and ETH.
The BNB coin is presently selling for around 52% less than its all-time high, which it reached on May 10, 2021, at $686.
The coin, whose market capitalization at the moment exceeds $50 billion, is a reference to the growing number of transactions and advancements occurring inside the Binance ecosystem.
The Binance Chain, Binance Smart Chain, Binance Academy, and Trust Wallet are just a few of the blockchain-based initiatives that use the BNB coin.
Based on daily trading volume, parent firm Binance is the largest cryptocurrency exchange globally and is committed to introducing new-age money to the globe.
Are meme coins riskier?
Meme coins, characterized as cryptocurrencies that draw their influence from memes, first appeared in 2021.
Dogecoin is the most well-known meme coin and has the highest market valuation among cryptocurrencies in this category (DOGE).
The Shiba Inu dog picture that served as the inspiration for DOGE’s design was a popular internet meme. Elon Musk, who is sometimes referred to as the “DOGEfather,” also supports the project.
Since its ATH of $0.73 on May 7, 2021, DOGE’s values have fallen by more than 90%. However, the meme coin is quite well-liked in the cryptocurrency world, particularly among Gen Z investors.
Shiba Inu (SHIB), which has a market valuation of $6.8 billion against DOGE’s $9.5 billion, is the second-largest meme currency.
Along with DOGE, the SHIB token has lost around 85% of its value from its all-time high of $0.000086, which it hit on October 27, 2021, and has contributed to the loss of billions of dollars in investor capital.
Dogelon Mars (ELON), Baby DogeCoin (BabyDoge), and Samoyedcoin (SAMO), which all have far lower market capitalization than DOGE or SHIB, occupy the following three positions on the list of the top meme currencies.
However, the values of these tokens have decreased, with ELON’s price dropping by 99%, SAMO’s by 92%, and BabyDoge’s by 82%, respectively.
Unsurprisingly, the entire class of meme currencies has performed far worse than other altcoins and presents a riskier investment opportunity for cryptocurrency enthusiasts.
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