Deconstructing Memes: Why are MEMEs doing so well this cycle?

Student author | @shaofaye123

Instructor | @CryptoScott_ETH

First time | 2024.5.31

1. Module Because it spreads through imitation. Any piece of information can be called a meme as long as it can be copied through imitation; information in the form of words that spreads is a variety of memes; its expression can be in many forms, such as music, thought or style, etc. . The meme transmission process is consistent with the life cycle theory, and the transmission method is suitable for the infectious disease model, but its strong meme standard is still difficult to quantify.
2. MEMEs appear in different forms in each cycle. As the cycles change, their characteristics, mechanisms, etc. are different. MEMEs can reflect the mentality of investors and market hot spots in different periods to a certain extent, including the outlook for current new technologies and the direction of narratives.
3. This wave of bull market MEMEs is influenced by society, psychology, economy and technology. At this stage, the types of MEMEs can be roughly classified from aspects such as mechanism innovation, market narrative, market sentiment, meme culture, celebrity effect, and hot imitation disks. Its gameplay mechanisms are diverse, and you need to establish a reasonable strategy to make a profit.
4. The future of MEMEs is highly controversial, with institutional and retail KOLs having different opinions. MEMEs must be interesting and meaningful, and cannot be reduced to a tool for speculation.

#From Ethereum to Solana, MEMEs never lack for myths of benefit. According to a CoinGecko report, MEMEs were the most profitable cryptocurrencies in the first quarter of 2024, with the top token posting the highest average return of 1,312.6%.

PANews once interpreted the investment return of MEMEs from the perspective of the Kelly formula. By calculating the daily number and winning rate of coins issued on the Ethereum and Solana chains, we found that their winning rates are extremely low. Ethereum’s winning rate is 3.28%, and Solana’s is even lower, only 1.6%. They will eventually become a slaughterhouse for players to lose forever. .

MEMEs as a high-risk, high-reward investment game. How does it engage the public and spread? Value coins vs MEMEs, what is the future of MEMEs?

"When we leave this world, there are only two things left, one is genes and the other is MEME."

——Richard Dawkins

MEME, also known as meme, meme, Mi, Mimi, Meme or meme, is the abbreviation of mimeme (derived from the ancient Greek μíμημα) , its original meaning is to imitate or copy. The concept of MEMEs originally originated from the book "The Selfish Gene" written by British evolutionary biologist Richard Dawkins. It describes memes as "units of cultural inheritance that reproduce themselves in a meme pool through... (broader) imitation".

The concept of memes has been tinged with biological analogies since its inception. This analogy equated memes with genes (both capable of self-replication, inheritance, mutation, and response to selective pressures) and gave rise to a new discipline—memetics.

The classification dimensions of memes are diverse. From the perspective of pros and cons, they can be divided into beneficial memes and harmful memes. According to the expression form, they can be divided into compound memes and simple memes. From an evolutionary perspective They are divided into symbiotic memes and parasitic memes, and can be divided into strong memes and weak memes according to their replication ability.

Currently there are various interpretations of the concept of memes. The more generally accepted definition is mainly based on the synthesis of Dawkins and Blackmore, that is, memes spread through imitation; any one Information, as long as it can be copied through imitation, can be called a meme; information in the form of words that spreads is a variety of memes; memes can be expressed in many forms, such as music, ideas or styles, etc. .

The definition of MEMEs is even more different. There are big differences in how MEMEs are perceived by different people. BTC is perhaps the biggest MEMEs in the eyes of Web2. In the eyes of mainstream currency players, altcoins may all belong to MEMEs. But summing up their common points, it can be found that MEMEs refer to those Tokens that have no actual use in the eyes of investors, only exist for speculation, and rely on market sentiment for pricing.

The meaning of a meme "being imitated and spread" means its own iteration. Without the act of spreading, it would not constitute a meme.

It can be seen that the successful replication of MEMEs is inseparable from communication. How do MEMEs spread?

A MEMEs is expressed (E), transmitted (T), assimilated by the recipient (A), and finally saved (R) by the recipient in the brain’s memory system. After completing these four steps, MEMEs find a new The host completes a life cycle of MEMEs communication.

#The mode of transmission is similar to that of viruses, and the transmission path can be well revealed from the infectious disease model. The infectious disease model divides the population into susceptible, exposed, infected and recovered to simulate the transmission mechanism. Due to the short incubation period, the spread of MEMEs is usually deconstructed from the SIR model. The number of susceptible people decreases, the number of recovered people increases, and the number of infected people first increases and then decreases, and there is a peak. This peak is the vertex of MEMEs. Opinion polarization, opinion leaders and emotional contagion will all have different impacts during the communication process.

In addition, the transmission mechanism of Internet memes is also related to the social identity theory of psychology. Spears and Lea (1992) found that due to the anonymous nature of the Internet, members of virtual communities cannot effectively display personal traits and identities. People must rely on society's definitions of certain decisions and organizations to help define themselves and their relationships with others. interactive relationship between. Therefore, in the process of spreading, memes are also shaping the sense of identification with community organizations. The community agrees that the stronger the identity, the more powerful the meme spreads.

An interesting phenomenon worth mentioning is that in the Solana chain pump gameplay, MEMEs holders are worried that serious project parties cannot withstand the decline and Rug, and will encourage and support Dev in the community. On the other hand, it reflects that a good community atmosphere will promote both parties, thereby strengthening community identification and making MEMEs more likely to leave the circle.

Source: https://zhuanlan.zhihu.com/p/103974270

Strong meme indicators have It has strong guiding significance and can not only help individual traders determine whether the meme can be successfully spread, but also at what stage of the life cycle it is at? It can also help project parties create more out-of-circle MEMEs.

From the perspective of biological evolution, Dawkins (1998) proposed three indicators to measure successful memes:

1. Copying-fidelity: The more copies The more faithful it is to the template, the more likely it is to maintain its inherent characteristics after several rounds of replication.
2. Fecundity: The faster the replication speed, the wider the copies spread.
3. Longevity: The longer the entity's replica template lives, the more copies it will make.

Successful memes require all three. Powerful memes go viral largely because they are easy to remember, not because they are important or useful. Therefore, effective memes should be those that evoke a high degree of authenticity and preserve memories for a long time.

From a communication perspective, Heylighen more specifically described 10 selection criteria such as coherence, novelty, and simplicity. Thus, a simple formula for meme fitness was designed.

F(m)=A(m)x R(m)x E(m)xT(m)

F(m) represents the average of MEMEs in a certain time unit t The ratio of the number to the average number of MEMEs in the previous time unit t-1.

A (m) represents the ratio of the assimilation rate before and after the moment;

R (m) represents the maximum storage time ratio of the assimilated MEMEs before and after the moment;

E (m) represents The ratio of expression times of a MEMEs saved by the host at the preceding and following moments;

T (m) represents the ratio of the number of copies of expressions propagated to the host at the preceding and following moments.

At a certain moment, A ≤ 1, R ≤ 1, and E has no upper limit. You can express a MEMEs 10 times, 20 times, or hundreds of times; T also has no upper limit. , if through broadcasting, assuming there are 10,000 listeners, it is equivalent to copying 10,000 copies of MEMEs each time. As long as any factor in the above formula is zero, its product must be zero. To make the fitness F>1, one of the strategies is to make E>1 or T>1.

By observing the propagation trends and rough statistics of most memes, Heiligan research found that if a model meets certain criteria in the above table, it is possible to successfully implement the model. The life cycle of the gene causes it to be copied and spread to become a powerful meme.

But whether from the perspective of communication or biological evolution, it is difficult to accurately determine to what extent memes that meet which criteria are strong memes. Combined with finance and mathematics-related disciplines, the winning rate of secondary trading indicators on MEMEs is about 30%, and there will be certain errors. Liquidity, the proportion of the top ten positions, the number of project Rugs, etc. will all have an impact on measuring MEMEs. However, it is difficult to accurately quantify the actual indicators. Combining AI large model analysis may be helpful.

Since the birth of Bitcoin, MEMEs have existed and performed well in every cycle. From Litecoin to Dogecoin to NFTs and Zoo MEMEs. MEMEs are presented in various ways, and their characteristics, mechanisms, etc. are different as the cycle changes. Sorting out its development and current situation will help to better discover version answers.

Source：https://dogecoin.com

The concept of MEMEs did not trigger a market craze when it was first born. It was not until Dogecoin (DOGE) in 2013 that MEMEs entered the public eye. .

Doge is a type of MEMEs featuring the Japanese Shiba Inu, originating from a picture of the Japanese Shiba Inu Kabosu that appeared in 2010. After Billy and Jackson launched Dogecoin (DOGE), it received widespread attention on sites such as Reddit and was used as a currency for tipping. Just 2 weeks after its birth, daily transaction volume exceeded that of Bitcoin.

In 2014, doge was selected as one of Time’s top MEMEs of the year and has appeared in mainstream culture. In 2021, the price of Dogecoin skyrocketed following multiple pushes from Elon Musk. The success of Dogecoin (DOGE) created the foundation for MEMEs to flourish, bringing new currencies. These new currencies were initially launched on Bitcointalk’s “Alternative Cryptocurrency” sub-forum in a proof-of-work (PoW) manner.

Subsequently, different MEMEs will emerge in each period. Looking back at the ICO craze in 2017, most projects would provide detailed white papers to attract investment with the potential of technological innovation. Most of the MEMEs during this period were more serious and their vision was to make practical innovations beyond MEMEs.

Under the Defi craze, projects are more focused on elaborating on economic and liquidity advantages to attract participants. At that time, MEMEs were mainly animals, food, etc. In addition, NFT projects were also considered to belong to MEMEs in the early days. Some of the most representative NFTs include: CryptoPunks, Bored Apes, Pudgy Penguins, etc.

The current craze of MEMEs relies more on emotional promotion. The project no longer pursues technological innovation, but focuses more on narrative direction and market hot spots. This phenomenon may reflect some degree of market weakness, as investors gradually begin to seek more IQ50 ways to participate in the market after a long period of technical orientation. Pump emerged under this model, and the instant and low-cost method attracted a large number of players to participate.

Tracing back to the development of MEMEs, the characteristics of MEMEs can reflect the mentality of investors in different periods and current market hot spots. MEMEs include the outlook on current new technologies and the capture of hot topics.

Source：https://www.MEMEsrace.xyz/

MEMEs can bring prosperity to the public chain. From Doge to Bome, MEMEs have become a unique cultural symbol of Web3 and communication style. MEMEs have a place in all major public chains.

Currently, some MEMEs with high market value are mainly deployed on chains such as Ethereum, Solana, Base, and Bitcoin (BRC20, etc.).

Among the top 500 MEMEs by market capitalization, most are deployed on the Ethereum and Solana chains. This reflects the prosperity of Solana chain’s MEMEs ecosystem in this bull market. Judging from the types of rise of MEMEs, since most of the Ethereum chain is early MEMEs, such as PEPE, SHIB, etc., the reason for the rise of its head MEMEs still belongs to the early narrative logic.

Solana chain MEMEs In addition to DOGE, the types of animal MEMEs are more diverse, and their gameplay is also more susceptible to market sentiment due to the emergence of BOME. The MEMEs that emerged from the Base chain are more inclined to capture technological trends and revolve around social ecology.

Source：Coinmarketcap

Innovative advantages of gameplay mechanism

Representative cases include PEOPLE and SLERF. Web3 consensus is king, MEMEs pays more attention to consensus. PEOPLE gathered nearly 20,000 people from all over the world through a ConstitutionDAO at that time, which was an in-depth experiment of DAO by MEMEs.

Curated by innovators Graham Novak and Austin Cain, it aimed to auction off a printed copy of the 1787 U.S. Constitution, becoming the first crowdfunded project to preserve a world historical document, and therefore a major success at the time. Create a hundredfold profit. For SLERF, due to operational errors by the project side, the founder was forced to repay the loan, achieving a completely fair sale and triggering a boom.

Capture the direction of market narrative

There is a certain time difference between the primary market and the secondary market. And MEMEs themselves can reflect the pursuit of new technologies. When the current narrative of the secondary market is about AI, it can be seen that AI MEMEs are also soaring rapidly, and AIDOGE, AIBB and other AIs have soared one after another.

In addition, festivals such as Women’s Day and Spring Festival will also cause the increase of related tokens such as LADYS; NVIDIA conference and CZ court will also trigger the issuance and fluctuation of tokens such as NVEDUA and FREECZ. However, such MEMEs Most quickly return to zero after the event is over.

Elusive market sentiment

This type is difficult to judge, but most of them trigger people's consensus and ignite market enthusiasm. For example: the founder of BOME added a pool to the operation, and its large-scale pattern quickly detonated the market.

STRONG MEME CULTURE

DOGE became popular before the token was released, and PEPE’s emoticons were widely spread before the token was released. These are all strong memes that came first. Here comes the token example again. In addition, MEMEs with artistic characteristics tend to be stronger, possibly because artworks are inherently more unique during the assimilation stage.

The influence of celebrity effect

Musk called for Dogecoin, triggering “DOGE to the moom”. Anatoly Yakovenko, founder of Solanaana, launched SILLY during Halloween, which also performed extremely well. In less than two weeks since its launch, the market value has reached US$70 million, with more than 8,600 currency-holding addresses and an on-chain pot of US$1.2 million. Due to the Summer Olympics on the chain, national tokens have also emerged one after another. Musk only mentioned Argentina in a tweet, and smart money on the chain immediately discovered it and bought it to gain huge profits.

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