The Hottest Track in 2024, MEMECoin Takes the Lead
In 2024, the hottest track in the market is undoubtedly MEMECoin. This cryptocurrency has quickly become the darling of the market due to its unique internet culture background and passionate community support. According to research by Biteye, MEMECoin has outperformed all others in the first half of 2024, with an astonishing return rate of 1834.22%, leaving the second-place far behind by nearly 8 times.
In another report by KuCoin, researchers also noted the significant growth of the cryptocurrency market in May 2024, particularly the MEMECoin, which attracted a lot of attention and investment related to celebrities and hot topics. Speaking of this, one cannot help but mention the celebrity effect. You may have heard of Tesla CEO Elon Musk, whose tweets have caused significant fluctuations in the price of Dogecoin. However, who could have imagined that it was originally just a crypto joke?
MEMECoin’s Origins
Let’s go back to 2013 when Dogecoin dramatically emerged. At that time, its founders Jackson Palmer and Billy Markus created this token as a joke to mock the escalating cryptocurrency craze, thus creating the widely popular MEME Shiba Inu. However, the joke gained significant influence and evolved into a cultural phenomenon within the community.
Another typical MEMECoin is Shiba Inu Coin, which was launched in 2020 and branded as the “Dogecoin Killer.” Through extensive social media and community activities, it quickly gained a large following and even became one of the top 20 cryptocurrencies by market value. With the launch of Arbitrum in 2023, more MEMECoin projects emerged, propelling old MEMECoin projects like PEPE, FLOKI, and BONK to become favorites in the crypto circle, attracting both users and Web3 professionals to this track.
However, for some newcomers to Web3, distinguishing between MEMECoin and NFT can be a bit confusing. Why? Because they are very similar! Both represent PFP (Profile Picture) images, rely on crypto community culture, and their prices are mostly driven by FOMO. A typical example is BOME (Book of MEME), a project that stores MEMECoin cultural images in IPFS and encapsulates this data into each BOME Token, making it both a PFP and a valuable NFT. Another example is Inscription, with each inscription having its specific storage location and content on the blockchain, including text, images, or other forms of information.
So, how can investors and developers differentiate between MEMECoin and NFT?
Differences Between MEMECoin and NFT
Indeed, both MEMECoin and NFT share commonalities in terms of technology, community attributes, and symbolism. However, they differ significantly in terms of technical standards, nature, purchasing motivations, and issuance mechanisms.
Technical Standards
MEMECoin: The most common MEMECoin uses the ERC-20 standard on the Ethereum blockchain.
NFT: The basic NFT standard is ERC-721 to ensure each NFT is a unique asset, but some NFTs may use ERC-1155 for greater flexibility in creating both NFTs and fungible tokens.
Nature
MEMECoin: It is a digital currency based on blockchain technology, primarily used for trading and investment, with its price changes depending more on speculation and market FOMO.
NFT: Represents a unique digital asset, typically used for digital artworks, music, in-game items, etc., with its value often tied to rarity and artistic value.
Purchasing Motivations
MEMECoin: Mainly used as a speculative tool, with participants hoping to profit from price fluctuations, often driven by social media and celebrity effects, as seen with Dogecoin and Shiba Inu Coin.
NFT: Primarily used as proof of digital assets for collecting, showcasing, and trading, attracting attention from artists and collectors due to its brand value, scarcity, and uniqueness.
Issuance Mechanisms
MEMECoin: Usually issued through ICOs (Initial Coin Offerings) or IDOs (Initial DEX Offerings), which can be simple but prone to various issues such as fraud and market manipulation due to lack of regulation.
NFT: Typically issued directly by artists or creators on specific platforms, relying more on the reputation of the creator and the uniqueness of the work, making it relatively more standardized and transparent.
In conclusion, despite MEMECoin appearing similar to PFP, its differences with NFT are quite evident, especially in its nature as a token, the volatility of its price, and the motivations of its users, which often lead to disputes and compliance issues.
Compliance Issues with MEMECoin
The low entry barrier, high risk, high returns, and strong community-driven force have contributed to the popularity of MEMECoin. However, regulatory issues need to be taken seriously.
In China, the government prohibits digital currency trading and ICOs, meaning direct issuance of MEMECoin is not allowed, but there is a relatively open attitude towards blockchain technology and NFT. In this scenario, the innovative combination of MEMECoin and NFT, such as the Inscription model, may provide developers with another possibility. However, careful attention to legal and compliance issues during issuance is necessary, considering current laws and regulations in China related to NFT issuance, including intellectual property issues, comprehensive information disclosure, consumer protection, and taxation obligations.
Furthermore, in the United States, many MEMECoin may be considered securities and must comply with the regulatory requirements of the U.S. Securities and Exchange Commission (SEC), Financial Crimes Enforcement Network (FinCEN), and Internal Revenue Service (IRS) for AML, KYC, and tax reporting and payment.
Similarly, in Japan, all cryptocurrency exchanges must register with the Financial Services Agency (FSA) and comply with AML, KYC, and tax regulations.
In the European Union, a unified cryptocurrency regulatory framework is being established, including the phased implementation of the Markets in Crypto-Assets Regulation (MiCA), requiring compliance with AMLD, strict KYC and AML procedures, and tax compliance according to the regulations of each member state.
In addition, regardless of MEMECoin or other Web3 projects, any issuance of tokens will face issues of market manipulation and fraud, necessitating the establishment of internal controls and risk management mechanisms to monitor and prevent such behaviors.
In conclusion, while MEMECoin is the hottest track, legal compliance issues loom large, and issuers must fully understand and comply with relevant laws and regulations to protect themselves while reaping the benefits.
In summary, as the MEMECoin market continues to evolve, the regulatory environment will also continue to change. Only by operating on a legal and compliant basis can MEMECoin achieve sustainable development and bring more value and opportunities to investors and society. If you encounter any legal issues during the issuance or investment process of MEMECoin, please feel free to consult our professional legal team. We will provide you with the highest quality legal services and support.
