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Cardano Drops Out of Top 10 With Memecoins Rising to the Top: Fun Over Function?

Last Updated May 29, 2024 2:39 PM
Giuseppe Ciccomascolo
Last Updated May 29, 2024 2:39 PM
Key Takeaways
  • Memecoins like Shiba Inu and Pepe have experienced a significant surge, disrupting the established cryptocurrency rankings.
  • Cardano has thus fallen out of the top 10 cryptocurrencies by market cap, overtaken by Shiba Inu.
  • This memecoin rally is attributed to a growing speculative frenzy and a gambling mentality within the crypto community.
  • The rise of memecoins highlighted a shift in investor preference towards high-risk, potentially high-reward opportunities.

Shiba Inu has dethroned Cardano from the top 10 rankings by market capitalization, reflecting a broader trend: memecoins are on a tear, with PEPE and Dogwifhat also reaching new highs.

Cardano, once a high-flyer, is now struggling, highlighting the market’s volatility  and raising questions about the growing popularity of memecoins, often seen as more speculative and less focused on real-world applications. Is this a sign that “fun” is overtaking “function” in the crypto space?

Cardano Exits Top 10 Coins

The recent surge in memecoins has propelled Shiba Inu to overtake Cardano in the top-10 crypto rankings by market capitalization.

The memecoin market has experienced a significant bullish run over the past few weeks, with notable coins like Shiba Inu, Pepe, and Dogwifhat reaching new all-time highs. This surge has allowed several memecoins to surpass established cryptocurrencies in market rankings.

Shiba Inu (SHIB) has seen its market cap rise to $16.4 billion, edging out Cardano (ADA), which now has a market cap of $16.3 billion.

This shift places Shiba Inu in the top 10, while Cardano has slipped to 11th place. Cardano, once the third-ranked cryptocurrency during the 2020-21 bull run, is currently trading at $0.45, which is more than 80% below its all-time high of over $3.10. Despite the broader recovery in the crypto market, with Bitcoin and other altcoins hitting new all-time highs, Cardano remains relatively stagnant, similar to Ripple.

Shiba Inu dethrones Cardano
Shiba Inu dethrones Cardano as the 10th largest crypto by market capitalization.

Among the rising memecoins, PEPE has shown impressive performance, contributing to the broader trend of significant gains in this category.

The approval of spot Bitcoin Exchange Traded Funds (ETFs) earlier in 2024 has further fueled this rally. Currently, PEPE ranks as the 19th largest cryptocurrency by market capitalization, reflecting its strong market presence.

Cardano influencer Chris O criticized  Solana’s embrace of memecoins on X, labeling it a “web3 casino.” In contrast, he praised Cardano’s approach, asserting that it “was built to solve real-world problems and positively impact society.”

Fun over Function

Chris O’s post highlights a significant shift in the cryptocurrency market dynamics. The recent surge in memecoins has indeed reshuffled the crypto rankings, underscoring the market’s volatility and rapid changes. Shiba Inu’s rise and Cardano’s fall illustrate the fluid nature of the crypto landscape, where newer coins – and those with less serious projects – can swiftly climb the ranks, driven by shifting investor interest and evolving market trends.

The positive momentum behind memecoins reflects a broader sentiment within the crypto community that favors speculative and high-risk investments.

This trend towards memecoins and what Chris O describes as “web3 casinos” indicates a growing appetite for gambling-like opportunities in the crypto space, often overshadowing projects that focus on long-term utility and real-world applications.

Cardano’s mission to solve real-world problems and create a positive societal impact represents a different approach compared to the speculative nature of memecoins. This shift underscores the evolving nature of investor preferences within the crypto space. Where the allure of meme-driven tokens and the excitement of potential gains contribute to market dynamics.

This dichotomy in the crypto market also highlights traders’ diverse motivations and the varying philosophies of different blockchain projects. As the market evolves, it’s worth observing how these dynamics play out. And whether the speculative frenzy around memecoins will give way to more substantive, utility-driven investments in the long run.

While genuine interest and potential utility may play a role for some memecoins, a significant portion of this momentum likely stems from a speculative frenzy and a gambling mentality within the crypto community.

It’s Not Roaring Kitty’s “Responsibility” Only

As said, PEPE and SHIB increased notably over the last few days. But this upswing is part of a broader memecoin rally, with most meme-based cryptocurrencies experiencing gains. Interest in this sector spiked in recent weeks after the trader and investor Roaring Kitty reemerged into the trading scene following a three-year hiatus.

On Monday, May 13, Roaring Kitty – whose real name is Keith Gill -, made a notable return to Twitter, posting a series of characteristically playful videos. Gill, widely credited with initiating the 2021 GameStop short squeeze, sparked a memecoin rally with his reappearance.

But it’s relevant to note that the number of addresses holding memecoins for less than 30 days hit a record high last month. This signaled a significant influx of new traders into the market prior to Roaring Kitty’s comeback.

Traders have been viewing PEPE, MOG, and other memecoins as leveraged means to gain exposure to Ether. In particular after the US Securities and Exchange Commission (SEC) approved an ETH exchange-trader fund (ETF). The surge in these tokens commenced exactly when analysts raised the likelihood of ETH ETFs being approved for trading in the US.

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