How Are Meme Coins Created?

By George
8 Min Read
Source: Unsplash

A cryptocurrency is a type of virtual currency that employs the usage of encryption in order to keep financial transactions private. On a computer system, it is intended to function as a medium of trade, but its management is not dependent on any centralised authority, like a governing body or a financial institution. Because cryptocurrencies lack a centralised issuing or governing body, the recording of activities and the distribution of new units are both handled through a decentralised system. Blockchain technology is what cryptocurrencies are built on.

Mining is the process of producing new units of a cryptocurrency by using computer hardware to resolve challenging maths problems in order to make coins. Mining is also known as “cryptocurrency mining.” There is a wide variety of cryptocurrencies available today, including Dogecoin, Bitcoin, and a great number of others.

Keep yourself Up To Date

In this day and age, it is always important for investors to keep a tab open on any potential investment opportunities. So if you are looking to find the next meme coin to explode, then make sure to go and check this out as you will be able to keep yourself updated on a daily basis. This will surely help you find the next big thing!

How can people get their hands on cryptocurrency?

Mining is the process that generates new units of a cryptocurrency like bitcoin or ethereum. Mining is the act of verifying exchanges using a cryptocurrency and making new units of the cryptocurrency at the same time. In order to generate coins, the mining process involves the use of powerful software and hardware to work through difficult mathematical problems.

Blockchain technology is what cryptocurrencies are based on. Therefore, anytime a cryptocurrency transaction takes place, miners for cryptocurrencies (who also serve as nodes on the blockchain network, which is the location of such kinds of cryptocurrency transactions) attempt to decode the block that contains the transaction details. Not only does the block verify the transaction, but it also offers information on who transmitted how much bitcoin to whom, when the transaction occurred, and on what day it occurred.

A new block will be added to the blockchain as soon as it has been encrypted and validated as genuine by the majority of the nodes that make up the blockchain network. The verification system requires a significant amount of processing power, making it a particularly resource-intensive operation. Because of this, single cryptocurrency miners frequently find the process to be unprofitable. As a result, miners frequently join mining pools in order to share the computer power required for mining.

Tokens and Coins

In a general sense, cryptocurrencies may be broken down into two categories: coins & tokens. A cryptocurrency programme known as a coin operates on its very own blockchain, which is the decentralised ledger on which all transactions are recorded. Tokens, on the other hand, are digital assets that operate on pre-existing blockchain architecture and are often utilised for digital services, smart contracts, and other types of tangible assets.

How Does the Meme Coin System Operate?

Meme coins have extremely minimal entrance requirements compared to other digital currencies.

Because the blockchain technology that underpins such cryptocurrencies is accessible, it enables new cryptocurrencies to be created by simply “forking” established cryptocurrencies, which involves primarily copying and pasting the underpinning blockchain, and launching them online with only minor modifications, such as changing the name or the logo.

“A meme coin is merely a cryptocurrency so that they can be made quickly with a few lines of code,” says Tauhid Zauman. “Meme coins are becoming increasingly popular as a result of their ability to be used as a form of humour.” “The currency is capable of either creating its very own blockchain or living on an already existing blockchain.”

According to Zauman, the developers of meme currencies typically advertise their creations on social media platforms in order to generate early enthusiasm and push up the price of the meme currency. After then, there is a chance that the price will continue to rise if the currency is successful in developing a sizable community support base.

A great number of meme coins were issued in an effort to make money off of the frenzy that was caused by the bull market euphoria, which drove prices up throughout the market.

Should You Put Your Money Into Meme Coins?

There are a great number of other meme currencies, like Dogecoin, that have put individual investors in a very precarious financial position.

Even Dogecoin has lost 91% of its value since it reached an all-time high, while Shiba Inu has lost 84%. Both companies still have market valuations of around $6.5 billion and $8.7 billion, correspondingly.

Meme currencies often have a huge quantity, or even a limitless supply, in contrast to Bitcoin, which has a limit of 21 million coins.

There are currently more than 135.5 billion circulating coins for Dogecoin (DOGE), and a successful miner earns around 10,000 Dogecoin (DOGE) per minute. One Dogecoin now has a value of approximately $660. When contrasted to Bitcoin, where around 6.25 BTC, which is equivalent to approximately $143,000, is mined every 10 minutes, this is a remarkable disparity in terms of the amount of coins issued.

Because meme currencies often do not contain processes like “burns” that remove coins from circulation, the total number of coins that are now in circulation is continuously increasing. For example, as of the time that this article was written, the Shiba Inu monetary system has over 590 trillion coins in circulation.

Both Shiba Inu & Dogecoin have been hailed as successes within the meme coin community. The reality is that the vast majority of meme coins are forgotten over time.

According to Jonathan Zeppettini, the global operations director at Decred, “Nobody recalls the identities of Dogecoin’s peers from 2013-2014,” which are cryptocurrencies that did not trade anywhere at the time and have since “eviscerated unimaginable sums of speculative money.”

“We have a propensity to dismiss the fact that the winners are severe outliers in favour of concentrating just on the winners.”

Although the data seems to be stacked against joke coins becoming the next Dogecoin / Shiba Inu, the intense “fear of losing out” and salivating upside were most visible during last year’s bear market mania.

However, this does not stop retail investors from attempting to improve their financial situation. However, it is critical to keep in mind that they are, first and foremost, gambles and not investments.

By George
George is a passionate writer and technical lead in a reputed company, he is contributing since 1997 to the web, and he has worked in the top 500 fortune companies and made his remark.