{"id":39977,"date":"2025-01-29T11:25:37","date_gmt":"2025-01-29T11:25:37","guid":{"rendered":"https:\/\/mycryptomania.com\/?p=39977"},"modified":"2025-01-29T11:25:37","modified_gmt":"2025-01-29T11:25:37","slug":"the-rise-of-shitcoins-excerpt-from-magic-money","status":"publish","type":"post","link":"https:\/\/mycryptomania.com\/?p=39977","title":{"rendered":"The Rise of Shitcoins | Excerpt from \u201cMagic Money\u201d"},"content":{"rendered":"

The following is an excerpt of the first chapter from my book \u201cMagic Money: The Rise of Crypto Degens, Rug Pulls, and a Digital Revolution\u201d
Purchase now:
Paperback: <\/em>https:\/\/geni.us\/Magic_Money_Paperback<\/a>
ebook: <\/em>https:\/\/geni.us\/Magic_Money_ebook<\/a><\/p>\n

*******<\/p>\n

Chapter 1: The Rise of Shitcoins<\/strong><\/p>\n

\u201cA cryptocurrency with little to no value or a digital currency that has no immediate discernible purpose.\u201d<\/em>\u200a\u2014\u200aInvestopedia\u2019s definition of a\u00a0shitcoin<\/p>\n

Times Square is a living embodiment of American capitalism, plastered with advertisements from global brands like Coca-Cola, McDonald\u2019s, and Nike. However, if you walked through Times Square in March 2021 you would have seen a very different advertisement\u200a\u2014\u200aa billboard displaying the word \u201cSafeMoon\u201d accompanied by a logo of a moon with a rocket in the center. The billboard reads: \u201cSafeMoon the world\u2019s fastest growing cryptocurrency\u2026 sponsored by Reddit.com\/r\/SafeMoon.\u201d<\/p>\n

Simultaneously, \u201cSafeMoon\u201d was trending on social media platform X, propelled by tweets from celebrities such as the Backstreet Boys member Nick Carter, rapper Lil Yachty and Youtuber Logan Paul. A \u201cSafeMoon army\u201d has formed, consisting of diehard SafeMoon investors. They stand ready to shut down anyone online who dares spread FUD (crypto slang short for \u201cFear, Uncertainty, and Doubt\u201d) about SafeMoon. A SafeMoon army fanatic gets a SafeMoon logo tattoo on his leg, and naturally posts it online for all to see. Their actions are reminiscent of rabid football fans supporting their beloved team. And yet the commotion is centered around the cryptocurrency SafeMoon, kick-starting one of the most insane periods in crypto market\u00a0history.<\/p>\n

The hype around SafeMoon was due to its explosive increase in price in a short period. At its peak, SafeMoon reached a market capitalization of $5.75 billion in the space of just three months from launch. To put this into perspective, if you bought one dollar\u2019s worth of SafeMoon at launch (trading at the measly price of $0.0000000010) and sold at its peak, you would have made nearly $580,000. Was this staggering amount of value creation in such a short space of time the result of a new innovation in crypto? Or was it a unique revenue model, generating massive returns for\u00a0holders?<\/p>\n

The short answer is\u00a0no.<\/p>\n

SafeMoon\u2019s success boiled down to one thing: a catchy motto. Leveraging the crypto meme \u201cgoing to the moon\u201d, SafeMoon augmented this in its now-famous motto: \u201cJoin us on our journey safely to the moon.\u201d Who could resist the promise of safe money? The journey, as it turned out, was not safe at all. Following its peak in May 2021, SafeMoon has crashed by 99.98% (at the time of writing).<\/p>\n

Although possibly the most dramatic, SafeMoon was just one of many examples of shitcoins that characterized the so-called \u201cshitcoin era\u201d from 2020\u20132021. The shitcoin era gave birth to many crypto millionaires (a number of whom subsequently lost it all), an almost daily cadence of scams and rug pulls, and a legion of degens who swarmed onto the next shitcoin that they hoped would be the new SafeMoon.<\/p>\n

How did this madness happen? And what actually is a shitcoin?<\/p>\n

Crypto 101<\/strong><\/p>\n

Before diving into the world of shitcoins, it\u2019s essential to understand what exactly terms like \u201ccrypto\u201d and \u201cblockchain\u201d mean. By now, most would have at least heard the terms, most likely from news stories featuring Bitcoin or infamous industry players like the disgraced Sam Bankman-Fried (covered in Chapter 9). However, when pressed, most of us would struggle to explain what the terms actually mean. Unsurprisingly, these concepts are often highly technical or rooted in jargon\u200a\u2014\u200amuch like the internet. Despite being used by billions of people each day, if you were to ask how the internet works, you would likely be met with a blank\u00a0stare.<\/p>\n

Cryptocurrency, or crypto, has become a catch-all term to relate to a broader industry that has developed around blockchain technology. There are many different definitions of what blockchain is, but I favor the definition as simply being a \u201cfancy database.\u201d All innovations that flow from the technology center around the advantages and opportunities unlocked by having a fancier database.<\/p>\n

Let\u2019s say, for example, you deposit $1,000 into your bank account today. You log into your online banking app and see that your bank balance has increased by $1,000. What you don\u2019t see are the operations behind the scenes for that $1,000 to be reflected in your app. At the back end, the bank has a large database (called a \u201cledger\u201d) that it continuously updates and reconciles. Every time a transaction is made, the bank will update its database to reflect it. The issue with this kind of database is that it is private, not transparent, costly, and clunky to maintain (with many bank databases using code from more than 30 years\u00a0ago).<\/p>\n

Blockchain technology, at its core, is just a new type of database, using a combination of complicated cryptography and mathematics to ensure its accuracy. The main benefit of blockchain technology is that it allows for a public, trustless system, and a decentralized database. It does not have to rely on a trusted party to maintain the accuracy of the database (e.g., a bank continually updating and reconciling its database). This is why blockchain technology has the potential to revolutionize finance, as it can replace many of the operations of financial institutions with something significantly better.<\/p>\n

Blockchain is necessary for cryptocurrencies to exist. A cryptocurrency needs a blockchain to store it. For example, Bitcoin is stored on the Bitcoin blockchain. Every time a Bitcoin is transferred from one person to another, the Bitcoin blockchain is updated. Unlike banks, every single transaction on the Bitcoin blockchain is visible for everyone to\u00a0see.<\/p>\n

The key to understanding cryptocurrencies is to think of them as a combination of shares and currency. Like shares, they trade in public markets with prices constantly changing (often quite rapidly). However, unlike shares, they have characteristics of currency\u200a\u2014\u200athey can be used to pay for things or perform specific actions. Each cryptocurrency will vary in what it can or cannot do, but the critical thing that binds them all together is that they are stored in a blockchain database. When referring to cryptocurrencies, the terms crypto, \u201ctoken\u201d and \u201ccoin\u201d can all be used interchangeably. Purchasing crypto is straightforward as well. Many currency exchanges as well as payment providers allow you to directly exchange currency (e.g., US dollars) for crypto, and vice\u00a0versa.<\/p>\n

Okay, so what is a shitcoin then? This is where the fun starts. Most of the largest cryptocurrencies have clear utility (e.g., can be used to pay for services) linked to the innovative potential of blockchain technology. Take, for example, Ripple Lab\u2019s cryptocurrency \u201cRipple\u201d (trading under the ticker \u201cXRP\u201d). XRP is designed to enable secure, instant, and nearly free global financial transactions of any size. Overseas money transfers can be very time-consuming and costly, but Ripple Lab has designed a way to use the benefits of blockchain technology to radically improve this experience.<\/p>\n

While companies like Ripple Labs are structured like a typical tech company (e.g., teams of engineers, designers, and product managers) trying to crack a complex business problem, others see the potential of blockchain technology in a different light. And it\u2019s a much easier path than putting in the effort to create a viable product. What these people see is an ability to exploit the powerful human desire to get rich. And get rich\u00a0quickly.<\/p>\n

This is how shitcoins were born. The term shitcoin dates back to the early 2010s, only a few years after Bitcoin was created. It was originally a derogatory term used to describe \u201caltcoins\u201d (i.e., alternative coins to Bitcoin), with the earliest mention coming from the poster \u201cribuck\u201d on the forum Bitcoin Talk in November 2010. In an almost prescient post, ribuck\u00a0wrote:<\/p>\n

if bitcoin really takes off I can see lots of get-rich-quick-imitators coming on the scene: gitcoin, nitcoin, witcoin, titcoin, shitcoin\u2026Some of them are sure to attract users with promises like \u201cWhy use bitcoin, where you can only generate 50 bitcoins every few months? Use shitcoin instead, and you\u2019ll get 51 shitcoins every 2 minutes\u201d. Of course the cheap imitators will disappear as quickly as those 1990s \u201cinternet currencies\u201d like flooz and beenz, but lots of people will get burned along the\u00a0way.<\/p>\n

The term did not gather widespread usage until the 2020\u201321 bull market, at which point it entered the mainstream. During this period, shitcoins took on a life of their own, devolving into pump-and-dump schemes, straight-up scams, and rug pulls. While shitcoins are usually clearly a case of \u201cyou know it when you see it,\u201d they typically share the following three characteristics:<\/p>\n

1) cryptocurrencies with no definable use cases or vague\/illusory promises of future\u00a0utility;<\/p>\n

2) branding and marketing centered around a meme or gimmick (e.g., Trump Coin);\u00a0and<\/p>\n

3) underlying code that tends to be wholly recycled from other projects (with little to minor\u00a0tweaks).<\/p>\n

But the most striking thing about shitcoins is the absolutely crazy amount of money people can make from them\u200a\u2014\u200atheir investment often going from a value of $0 to millions in a matter of a few days. This, of course, is matched by the large number of investors who subsequently lose their money when the shitcoin\u2019s price collapses. The glory days of shitcoins can be traced to the COVID-19 era of 2020 to 2021, led from the front by SafeMoon.<\/p>\n

Crypto bubbles\u200a\u2014\u200athe genesis of shitcoins<\/strong><\/p>\n

Like other financial markets, crypto has seen many boom-and-bust cycles. In 2017, crypto prices exploded. Bitcoin was trading at around $1,000 at the start of the year but climbed to nearly $20,000 towards the end of the year. When Bitcoin\u2019s price increases, it typically coincides with the entire market rising with it. During this bull run, the previously mentioned XRP token led the way\u200a\u2014\u200aincreasing by around 36,000% (a $1,000 investment at the start of the year would be worth nearly $36 million by the end of it). And these types of returns were not simply on paper\u200a\u2014\u200aone could quite easily sell this cryptocurrency (or any cryptocurrency for that matter) in minutes for US dollars, and get ready to retire on a beach in a tropical location.<\/p>\n

While many legitimate cryptocurrencies saw explosive growth, an exuberant market can result in heavy speculation in more dubious cryptocurrencies. As more capital and awareness came to the market, speculators turned to more and more fringe projects. As the saying goes, \u201ca rising tide lifts all boats\u201d, hence even shitcoins experienced price rises in these periods as\u00a0well.<\/p>\n

Asset bubbles are, of course, not a new phenomenon in markets. Rewind to the 1600s in the Netherlands: from 1634 to 1637, the price of tulips exploded. First introduced by the Ottoman Empire, tulips became a prized possession in the Netherlands, eventually leading to wild speculation. Labeled \u201cTulip Mania,\u201d a single tulip at its peak was sold for the price of a luxurious mansion. The bubble in many ways was very modern, seeing the use of sophisticated financial instruments that are commonplace today, such as futures trading. These futures contracts allowed people to trade on the price of tulips at a future date, without the need to actually hold the tulips themselves. This meant that speculators could leverage their investments up through these contracts, increasing their potential return but simultaneously increasing their risk. These innovations in part allowed for prices to run well above their \u201cfundamental value.\u201d The bubble finally burst in early 1637, but it set a pattern for financial asset bubbles that we\u2019re still witnessing today.<\/p>\n

A more recent example is the dotcom bubble from 1995 to 2000. In a similar arc to crypto markets, the dot-com bubble was driven by the revolutionary potential of the internet. Market participants quickly realized the revenue opportunities possible through the internet, and massively boosted investment into internet companies. While investors\u2019 central thesis that the internet would radically change the world proved correct, the price paid for these investments became utterly divorced from their fundamental value. Internet companies at the time generally had little to no income or positive cash flows, meaning their entire valuation was based on forward-looking estimates. Investors could \u201cchoose your own adventure\u201d on valuation, inputting whatever numbers they liked into their spreadsheets to justify their investment. As more investment capital piled into the market and speculation grew, prices rapidly increased in\u00a0tandem.<\/p>\n

During this period, the NASDAQ stock index rose around 800%. In a frenzy, seemingly any company that added a \u201c.com\u201d to their name saw the value of their shares rise dramatically. Perhaps the most famous example of exuberance was Pets.com. The company grabbed attention by using a dog sock puppet in advertisements (including during the 2000 Super Bowl). Its business model was simply selling pet supplies directly to retail customers online. The challenge for Pets.com was that it could not sell supplies for a profit, losing money on each sale due to high shipping costs for large items and intense competition with bricks-and-mortar pet stores. Undeterred, markets poured huge capital into the business\u200a\u2014\u200aincluding $82.5 million during its NASDAQ Initial Public Offering in early 2000. The company went on to lose around $147 million for the next nine months post-listing before collapsing.<\/p>\n

The dotcom bubble ended in 2000, with the NASDAQ falling more than 75% over the next two years\u200a\u2014\u200awiping out more than $5 trillion in market value. While the dotcom bubble led to money flowing into unsuccessful businesses, many modern-day behemoths, like eBay and Amazon, started around this period. In many ways, the dotcom bubble has parallels with crypto market bubbles. The base foundation is an innovative technology with genuine potential, leading to these capital inflows\u200a\u2014\u200abut eventually turning a corner into wild speculation.<\/p>\n

GameStop and the birth of shitcoins<\/strong><\/p>\n

Following the boom and bust of crypto markets in 2017, there was relative calm. Referred to as a \u201cbear\u201d market, these periods typically focus on legitimate projects continuing to build and refine their products and services. However, by late 2020, things started to turn. With the global economy in recession in the wake of the COVID-19 pandemic, governments and central banks coordinated to pump stimulus into the economy. Led by the Federal Reserve, the US Central Bank cut interest rates to zero and embarked on a \u201cquantitative easing program\u201d (banker jargon for printing money). With excessive capital circulating and many people staying inside and therefore online due to the pandemic, conditions were perfect for another crypto bull\u00a0market.<\/p>\n

Cryptocurrency prices started a significant upward trend from mid-2020. The northern hemisphere summer of 2021 kick-started the rise of shitcoins. The surge had an unlikely source: the bricks-and-mortar gaming store GameStop. The increase in digital distribution of games disrupted GameStop\u2019s business model. This resulted in a steadily decreasing share price hovering around $1 at the start of 2020. It still had an air of nostalgia around it, with people having fond memories of going into their local GameStop store to buy their favorite video game in their\u00a0youth.<\/p>\n

Momentum around GameStop\u2019s shares started to build on the subreddit forum (a sub-community on the social media platform, Reddit) \u201cWallStreetBets\u201d. These posts focused on shares and options trading\u200a\u2014\u200abut it was nothing like a traditional forum. WallStreetBets\u2019 users called themselves \u201cdegenerates\u201d seeking \u201ctendies\u201d (i.e., profits), likening the share market to a casino. Users were infamous for posting so-called \u201closs porn\u201d\u200a\u2014\u200atypically consisting of a screenshot of the user\u2019s trading account down an enormous amount of money. Users tended to be surprisingly stoic and supportive of each other in the face of such\u00a0losses.<\/p>\n

WallStreetBets propelled GameStop to become the first-ever \u201cmeme share\u201d. Many institutional investors had a negative view of the long-term prospects of GameStop and tried to profit from this view by \u201cshort selling.\u201d Short selling, in essence, involves borrowing shares in a company and then selling them on the market. Short sellers are betting that the share price will fall, at which point they will buy back the shares at a lower price and return them to the lender. Cutting through the jargon: short sellers make money when the share price falls and lose when the price goes\u00a0up.<\/p>\n

Through a series of so-called \u201cdue diligence\u201d posts on the positive prospects for GameStop, it became more popular amongst the more than 10 million WallStreetBets subscribers. The public face of WallStreetBets became Keith Gill, better known by his YouTube account name \u201cRoaring Kitty\u201d and Reddit username \u201cDeepFuckingValue\u201d. Gill, a former financial analyst in the US, started his YouTube channel with videos and livestreams about his investment philosophy, research tools, and methods for assessing stocks. Gill\u2019s early videos were quite technical, covering complicated valuation metrics he used to research and compare stocks. Despite the subject matter often being quite dry, Gill\u2019s laid-back and charismatic personality shone through\u200a\u2014\u200aenhanced by frequently appearing in a bright red bandana with assorted colorful t-shirts displaying cats. Gill could have easily been relegated to one of many semi-popular financial YouTubers, garnering a solid following posting videos about stocks. It was his posts on WallStreetBets that catapulted him to international fame and led him to testify in front of Congress.<\/p>\n

Gill frequently posted on WallStreetBets about his GameStop \u201cYOLO\u201d investment (taken from the abbreviation for \u201cyou only live once,\u201d meaning a large extremely risky investment), first posting a screenshot of his call options (giving him the option to buy at an agreed price) on GameStop in 2019. Gill had purchased nearly $54,000 worth of shares and call options, which at the time were already at an almost $46,000 profit. Call options are a type of derivative, of which value is derived from the underlying value of the share (being GameStop in this instance). Gill purchased call options with a strike price of $8 (expiring in January 2021), meaning that if GameStop\u2019s share price did not go above $8 by January 2021, his call options would be worth $0. However, if the share price rose above this, he would return many multiples of his investment, as call options give the holders higher leverage than simply owning the shares. Given that call options can often result in a complete investment loss, they are risky. However, with high risk comes the chance of high\u00a0returns.<\/p>\n

With high conviction in GameStop (which trades under the ticker \u201cGME\u201d), Gill held onto his investment, making monthly update posts on WallStreetBets titled \u201cGME YOLO month-end update\u201d. Gill\u2019s posts earned him rapport from other users, seeing him as a fellow degen. By July 2020, Gill increased his investment in GameStop call options and shares to nearly $150,000, but was sitting at a loss of around\u00a0$40,000.<\/p>\n

On July 28, 2020, Gill posted a now infamous video on GameStop titled \u201c100%+ short interest in GameStop stock (GME)\u200a\u2014\u200afundamental & technical deep value analysis.\u201d Sporting a t-shirt with a cat wearing aviator sunglasses, Gill presented a detailed bull case for GameStop shares. In the nearly one-hour video, Gill addressed the major negative market commentary on GameStop and gave a detailed financial analysis, positing that it was massively undervalued at the $4 price it was trading at. In this video, Gill identified the chance that a \u201cshort squeeze\u201d could occur for GameStop shares, stating, \u201cI\u2019m not betting on a short squeeze, but it seems like something that could take place.\u201d A short squeeze refers to a situation where short-sellers race to buy shares on the market to cover their position in the face of rising prices. Their purchases then lead to the share price rising (as demand increases), often resulting in a spike in\u00a0price.<\/p>\n

By September 2020, Gill\u2019s luck changed. Posting a screenshot in WallStreetBets, his GameStop position was now worth nearly $830,000. The top upvoted comment reflected the forum\u2019s unique humor, with user \u201cLesath213\u201d posting:<\/p>\n

Now that people see your gains they\u2019re just going to FOMO it up to $15 a share, you will be the Game King or something stupid and then it will drop 20% and everyone will blame you for ruining their lives. But you won\u2019t care, you\u2019ll be sitting on 2.5m in mattresses and buying lambo\u2019s for your boyfriend and his\u00a0wife.<\/p>\n

Over the next few months, Gill\u2019s investment continued to rise in value, with hype building around GameStop from WallStreetBets and retail investors more broadly. This reached a crescendo in January 2021. With retail investors buying large volumes of shares, GameStop\u2019s share price rose sharply. As foreshadowed by Gill, this led to a short-squeeze, with hedge funds that had shorted GameStop shares, like Melvin Capital, experiencing heavy losses. Melvin Capital was supported by other hedge funds, like Citadel Capital, which were able to (at least temporarily) backstop Melvin Capital. Citadel Capital\u2019s founder and billionaire Kenneth Griffin became a major antagonist in the drama and was famously portrayed by Nick Offerman in the movie Dumb Money<\/em>. WallStreetBets viewed Melvin Capital\u2019s support by billionaires like Griffin as elites looking after other elites, while the retail traders were left to suffer their losses. This began to reposition the entire GameStop saga as a David vs Goliath battle of retail investors vs large and powerful financial institutions.<\/p>\n

This resulted in the share price increasing from a low of $2.57 to a peak of $483 on January 29, 2021. Many initial investors became extremely wealthy, with Gill\u2019s investment sitting at $46 million. With posts flooding WallStreetBets of huge gains, the \u201cmeme share\u201d era of the share market had begun. For the moment, large institutional investors like hedge funds didn\u2019t dictate share prices\u200a\u2014\u200ait would be the retail investors moving the\u00a0market.<\/p>\n

On February 19, 2021, Gill was hauled before a House Committee to testify on the GameStop saga. Appearing in a suit and tie (with a picture of a cat in the background with the text \u201chand in there\u201d), Gill defended his involvement in GameStop against allegations he solicited others to buy the stock for his own profit. He ended his testimony justifying his investment decision by stating, \u201cin short, I like the stock.\u201d With his testimony complete, Gill disappeared from public view, posting a final update on WallStreetBets showing a screenshot of his GameStop position of $34\u00a0million.<\/p>\n

With meme shares as front-page news, many retail investors turned their attention to cryptocurrencies. Crypto markets became fertile ground for memes and shitcoins, and had some inherent advantages over traditional equity markets for speculation. Firstly, a person can create a cryptocurrency in under 10 minutes. Boilerplate code is available online and can be easily used with minimal adjustments to launch a cryptocurrency. Even those without any coding skills can launch a cryptocurrency, with several code-free cryptocurrency launchpads available. This allowed almost instantaneously the creation of meme cryptocurrencies. Secondly, limited regulatory barriers to listing cryptocurrencies on exchanges enabled widespread access. Finally, given the relative anonymity that came with cryptocurrency creation, there was limited fear of repercussions for scams or rug\u00a0pulls.<\/p>\n

Taken together, crypto markets had perfect conditions to create a series of memes and shitcoins to rival GameStop and traditional equity markets. The fuse was first lit with the rise of the meme coin \u201cDogecoin\u201d (covered in Chapter 4). Dogecoin had traded well under one cent in late 2020 but rapidly increased in value shortly after GameStop\u2019s price multiplied in January 2021. Crypto traders quickly realized a flood of capital was coming for meme coins, with SafeMoon to be one of the first recipients.<\/p>\n

SafeMoon is\u00a0born<\/strong><\/p>\n

Just a few months after the GameStop saga, SafeMoon was created. The creator of the project elected to remain anonymous, using only the name \u201cKyle\u201d. Kyle had previously launched a token called \u201cGive Me Your Money (GMYM)\u201d, which unsurprisingly failed to get any traction. Kyle appointed Braden John Karony as the CEO of SafeMoon, with Karony acting as the public face of the company. Karony had limited experience in business, with his professional work experience solely consisting of six years as an analyst at the US Department of\u00a0Defense.<\/p>\n

The project itself had no utility or use-case when it was launched\u200a\u2014\u200aonly vague promises of some future utility. This did not transform the financial system or push the limits of blockchain technology. The very source code for SafeMoon was based on \u201cBee-Token\u201d\u200a\u2014\u200aitself a cryptocurrency that was a rug pull. The real purpose of the project itself is hinted at by its design. SafeMoon employed a mechanism that directly encouraged people to \u201cHODL\u201d. HODL is a deliberate misspelling of \u201chold\u201d\u200a\u2014\u200astanding for \u201chold on for dear life.\u201d The logic is that if everyone HODLs the cryptocurrency and doesn\u2019t sell, then the price would rise, making everyone\u00a0rich.<\/p>\n

The mechanism SafeMoon used to encourage investors to HODL was a huge transaction fee for selling\u200a\u2014\u200asitting at 10%. Half of this fee was redistributed to SafeMoon holders, with the other half going to a crypto wallet in a different cryptocurrency (Binance Coin) that was used to provide liquidity for trading of SafeMoon. The intent is clear: you get rewarded for HODLing and penalized for selling. This would be essential to SafeMoon\u2019s rise after it launched, with a supply of 777 trillion tokens priced at $0.000000001 each.<\/p>\n

While other shitcoins employed similar mechanisms, the marketing of SafeMoon set it apart. There was catchy branding, journeying \u201csafely to the moon\u201d\u200a\u2014\u200abut a clever name and slogan are not always enough to become a successful shitcoin. You need to reach a wide audience. Who better to leverage than famous influencers?<\/p>\n

SafeMoon engaged numerous celebrities to spread the word. With Dogecoin\u2019s rapid price rise, rapper Lil Yachty tweeted, \u201c#safemoon is the new dogecoin.\u201d YouTuber and professional boxer Jake Paul tweeted a reply a day later saying, \u201cfactsss.\u201d Paul, who initially rose to fame on the now-defunct social media video platform Vine, is suspected to have been paid nearly $190,000 for his endorsement (based on blockchain analysis of a payment from SafeMoon to his personal\u00a0wallet).<\/p>\n

A few weeks later, Backstreet Boys member Nick Carter tweeted, \u201cit\u2019s time for blast off [rocketemoji] #SAFEMOON.\u201d The combined impact of celebrity influencers, SafeMoon\u2019s marketing, and the meme potential of the coin, sent the price skyrocketing. Those who invested $1,000 near launch would be sitting on a million-dollar investment in little over a few\u00a0months.<\/p>\n

The growth trajectory and the number of investors with huge financial gains quickly made SafeMoon a crypto legend, further driving its value. On May 10, 2021, a billboard display in Times Square went live, promoting the token as the \u201cWorld\u2019s Fastest Growing Cryptocurrency.\u201d Karony then announced SafeMoon was talking with the Government of the West African country, the Republic of Gambia, to use SafeMoon \u201cfor innovation and learning purposes.\u201d The vaguely-worded project also apparently purported to bring wind turbines to households in\u00a0Africa.<\/p>\n

SafeMoon was trending on CryptoX and occupied the front page of the sub-reddit SatoshiStreetBets. SatoshiStreetBets is a cryptocurrency-focused offshoot of WallStreetBets, named after the anonymous founder of Bitcoin, Satoshi Nakamoto. With more than 500,000 subscribers, SatoshiStreetBets was the go-to place on Reddit to discuss shitcoins and YOLO crypto investments\u200a\u2014\u200awith SafeMoon featuring heavily. Posts flooded SatoshiStreetBets, in a bid to increase the price of SafeMoon, such as the following by user \u201cGMEandAMCbroughtme\u201d:<\/p>\n

Consider this the official announcement of a community driven campaign to pop off the biggest squeeze of all time. This will be the crypto version of Gamestop and AMC but way bigger. We aim to take the power from the banks and transfer it to the people. Why Safemoon? Because it\u2019s fkn sexy, it has a cool name, and we like the fkn moon. It\u2019s time to make #SafeMoonSqueeze go viral. Start tweeting it. Let the world\u00a0know.[1]<\/a><\/p>\n

The post ended with (as per usual in crypto), \u201cI\u2019m not a financial adviser and this is not financial advice.\u201d<\/p>\n

Speculation across X and SatoshiStreetBets was now about how high the price could go. The self-titled \u201cSafeMoon Army\u201d, consisting of SafeMoon holders, was out in full force with a simple objective: pump up the price in whatever way possible and suppress any opposing viewpoints (i.e., FUD). This was a distinctive and unsavory aspect of the crypto community at the time\u200a\u2014\u200aself-interested individuals seeking to suppress debate and legitimate critiques of projects for fear it could result in their investment declining in\u00a0value.<\/p>\n

Despite the SafeMoon Army\u2019s attempt to keep the price rising, inevitably, its bubble burst. With no utility for the token and its value solely the function of speculation, SafeMoon\u2019s price relied on new investors providing fresh capital to support it. Existing holders started to cash out their investments to shift to new shitcoins, causing the price to fall. As the hype subsided, the well of new investors began to run dry. Following its peak in April 2021, the price spiraled downwards (notwithstanding some occasional pumps) to sit more than 99% lower at the time of writing. This had a devastating impact on many investors, who bought in wholeheartedly to SafeMoon\u2019s narrative. In a Reddit thread, user \u201cTNGsystems\u201d posted a message from a former Reddit SafeMoon \u201cmaxi,\u201d who\u00a0stated:<\/p>\n

For me, safemoon was my first crypto. I was working at a school board at that time and was completely burnout and hating my life, it gave me hope that I could exit the job and become financially free, and bought into the misinformation and blatant false project potential. I understand and sympathize with people that are still maxis as they are trying to protect their declining investment, regardless of the signs. As more people left the \u201ccompany\u201d and continual articles and videos were released about the fraud and money stolen from the LP I started to wake up. The fact that John [Karony] never came out and made a statement raised my suspicions and then I finally dug deeper, it was obvious the whole time. I feel like an idiot haha, all good though lesson\u00a0learned.<\/p>\n

The SafeMoon team itself faced a class action lawsuit alleging SafeMoon engaged in a pump and dump scheme, deliberately misleading investors so the project creators could sell their holdings at a profit. Fraud allegations surfaced, with prominent independent researcher and YouTuber Stephen Findeisen (better known by the name of his channel \u201cCoffeezilla\u201d) first accusing them of misappropriating millions of dollars of funds. Coffeezilla has built a following of more than 3 million subscribers on YouTube through his detailed investigations of scammers across the internet and (more recently) in the crypto space. His videos feature him in front of a microphone with a white shirt and suspenders, reminiscent of a neo-noir private investigator. Inspired to shed light on scammers after his mother was sold \u201csnake oil\u201d following a cancer diagnosis, Coffeezilla\u2019s video on SafeMoon garnered over 4.5 million views. Based on blockchain transaction data research, Coffeezilla and his team concluded that SafeMoon\u2019s founder, Kyle, had transferred around $10 million worth of SafeMoon to his personal\u00a0wallet.<\/p>\n

The CEO, Karony, would go on to win Utah Business\u2019 CEO of the year in 2022, much to the ire of investors who lost money on their investment. As hype in SafeMoon subsided, the company attempted to market itself as more than a shitcoin, with Karony stating, \u201cWhile memecoins might have a different purpose, SafeMoon isn\u2019t a memecoin. We have a real mission behind us for a tech company. And again, our plan is to bring the future to\u00a0now.\u201d<\/p>\n

SafeMoon\u2019s founders and executives, including Karony, face fraud charges by the US Securities and Exchange Commission (SEC). It alleges millions of dollars were misappropriated to buy extravagant items like McClaren cars and luxury homes. Despite the eventual collapse of SafeMoon, one thing stood out in the minds of crypto investors. If I can get into a shitcoin project like SafeMoon early and get out at the right time, I could make millions. If it can happen to SafeMoon, it can happen with other cryptocurrencies.<\/p>\n

Other shitcoins rise<\/strong><\/p>\n

Imitators of SafeMoon quickly sprang up. A spiritual successor came in the form of \u201cSafe Mars.\u201d Why simply go to the moon when you could go to Mars instead? In a similar arc to SafeMoon, SafeMars experienced a rapid appreciation in price. The value of the project went from $0 to a peak of $427 million. Unsurprisingly, the project is now back to being worth almost\u00a0nothing.<\/p>\n

During this period, I invested in \u201cMoonJuice\u201d, a project which marketed itself as \u201cthe first ever crypto-powered energy drink.\u201d The precise intersection of blockchain technology and energy drinks was unclear then (and still is today). At the time, I was passively following a small telegram group discussing shitcoins. A prominent poster in the group (self-titled the \u201cshitcoin whisperer\u201d) had posted about MoonJuice being the next big shitcoin. He had established his credentials in the group through a series of successful shitcoin investments netting him over $500,000. Having been laid off due to the COVID-19 pandemic, he had taken to shitcoin investing full-time, posting at all hours of the day and night. He would often brag about how much he had lost to rug pulls (over $100,000) and preface his investment recommendations to the group, saying, \u201c90% chance this is a rug pull,\u00a0but\u2026\u201d.<\/p>\n

As was the pattern with most shitcoins, the price of MoonJuice experienced a brief pump, followed by a savage dump, with the price of their token \u201cMOJO\u201d worth nearly nothing today. The project stopped all updates in mid-2021.<\/p>\n

In a test of just how ridiculous names could get, the project \u201cCumRocket\u201d was launched with the token name \u201cCUMMIES.\u201d This token caught the attention of Elon Musk, who tweeted a series of graphics translating to \u201cCumRocket to the moon.\u201d This promptly sent the price of CUMMIES soaring more than 400% in the ten minutes following the tweet. The project intends to \u201cbring web3 to the adult industry\u201d and is still in operation despite the token dropping from a peak of $290 million to around $4 million at the time of\u00a0writing.<\/p>\n

Some shitcoins didn\u2019t pretend to be anything but a shitcoin. Such an example was the \u201cDogshit\u201d token, with one of its catchy marketing tweets as follows: \u201cLost all your gains due to the market SHITTING the bed? Invest in DOGSHIT now to recoup these lost gains and realize your own financial freedom!\u201d Others saw how ridiculous the whole situation was. This included the creator of the ironically titled \u201cSafe Crypto And Money\u201d cryptocurrency, giving it the acronym \u201cSCAM\u201d. While the SCAM coin community on Reddit is no longer active, you can still get SCAM tokens for the bargain price of\u00a0$0.007.<\/p>\n

Money started to flow to other projects that were not even set up to be a meme. Take \u201cOmicron coin\u201d, launched as a decentralized finance project (referring to crypto projects aiming to replace traditional financial services). The cryptocurrency garnered limited attention but when the World Health Organization named the latest COVID variant from South Africa \u201cOmicron\u201d, the price of the token rose nearly\u00a01,000%.<\/p>\n

Rug pulls and scams\u00a0begin<\/strong><\/p>\n

As money was cycled from one shitcoin to the next\u200a\u2014\u200aopportunities abounded for scammers to enter the space and ruthlessly exploit the information asymmetry between\u00a0parties.<\/p>\n

Cryptocurrencies are governed and issued using smart contracts (simply lines of code that automate actions). Most investors do not have the technical expertise (or time) to properly understand smart contracts, which can allow scammers to include malicious code in them. Often referred to as a \u201chard rug pull\u201d, scammers can build different loopholes in the code to steal cryptocurrencies from investors. An example of this was AnubisDAO. The project was named after the Egyptian deity Anubis, typically depicted as a man with the head of a dog. Many investors immediately saw the meme potential of the coin, with dog-related cryptocurrencies at the time performing strongly (e.g., Dogecoin and Shiba Inu). In total, around $60 million of investor funds poured into the cryptocurrency only for the project to be rug pulled using an exploit in the code. The scammer (suspected to be a project development team member) absconded with the\u00a0funds.<\/p>\n

One such victim of a rug pull was Julian Mangione, an accountant in Australia. Mangione, through his commerce degree at the University of Melbourne, had long been taught a \u201ctraditional\u201d approach to investing, mainly focused on a long-term buy-and-hold strategy in Australian equities. Over time, Mangione grew frustrated by his relatively low returns from this strategy, which were compounded when a close friend, Michael Cardamone, rang him with the news he had made $40,000 from a shitcoin in under a few\u00a0weeks.<\/p>\n

Cardamone, a HR worker, had seen a post for the shitcoin \u201cPOODL\u201d trending on the front page of SatoshiStreetBets. POODL was one of the many dog-themed shitcoins that were popular following the success of Dogecoin. Cardamone decided to, as he described, YOLO (go all in) a $500 investment in POODL. Forgetting about his investment for a few weeks, he checked his account and was astonished to see that it was worth $40,000, nearly an 8,000% return. Cardamone cashed out half of his investment, which he almost immediately regretted, as POODL continued its price rise (his investment would have been worth more than $100,000 if he had held for just a few more\u00a0weeks).<\/p>\n

Entranced by the possibility of life-changing returns, Mangione dipped his toes into this strange world. Mangione was admittedly a novice to cryptocurrencies, at this point only holding some Bitcoin (which he had rather humorously attempted to transfer to an email address, not entirely understanding how addresses work in crypto\u200a\u2014\u200abeing a unique set of characters to send and receive crypto). These types of investors were prime targets for rug pulls and scams. Mangione recounted his initial sense of excitement in the risk and possibilities of shitcoins, which would be a temporary reprieve from the mundanity of COVID-19 lockdowns. Cardamone recommended he invest in a shitcoin called \u201cPablo\u201d, a name that immediately resonated with Mangione due to the notoriety around the Columbian drug lord Pablo Escobar. Needing no more convincing, he invested $8,000 into Pablo. His excitement would be short-lived.<\/p>\n

Mangione went to sleep and awoke to check the price of Pablo. To his dismay, Pablo had been rug pulled, with the token now worthless and his entire investment erased. It was a devastating experience for Mangione. Money that he had spent months toiling at work to save, evaporated in an\u00a0instant.<\/p>\n

While tokens like Pablo took the form of a hard rug pull, other rug pulls took a more traditional route in the form of organized pump and dump schemes, which can often proliferate in penny stocks in equity markets (best illustrated in the 2013 film The Wolf of Wall Street<\/em>). Pump and dump schemes are either led by the project team or an organized pump and dump group. This was typically the primary modus operandi for a large number of shitcoins. Normally, the project team took a large allocation of cryptocurrency when the shitcoin was created. It would then embark on aggressive marketing tactics, spamming the social media platforms X, Reddit, and Discord about the cryptocurrency. It often also paid influencers and celebrities to promote\u00a0it.<\/p>\n

This became the primary lever to increase the virality and, subsequently, the price of the shitcoin. The more people talk about how it will be the next SafeMoon, the more buyers there are, and the higher the price goes. Importantly, pump and dump schemes are intended to increase the liquidity (i.e., trading volume) of the cryptocurrency. The inflows of buying volume allow the project team to be able to sell a large number of tokens without crashing the\u00a0price.<\/p>\n

Shitcoin project teams often directly paid influencers to tweet and promote a shitcoin, meaning the influencers would be directly incentivized to increase the price. This, of course, is nothing new in the world of influencers, whose livelihoods are almost entirely made from promoting goods and services. However, it is one thing to promote skincare products and entirely another to promote a shitcoin.<\/p>\n

There are some egregious examples, including the American YouTuber Tana Mongeau, famous for her \u201cstory time\u201d videos involving exaggerated stories of her life as an influencer. Mongeau posted a video to Instagram to her more than five million followers, promoting the cryptocurrency \u201cTitscoins\u201d. In the video, Mongeau stated, \u201cCan you believe my ownership in Titscoin just bought me this beautiful Rolls Royce?\u201d as the camera pans to show the car\u2019s interior, \u201cGet yours now,\u201d she adds. Titscoin\u2019s price eventually plummeted, even with Mongeau\u2019s endorsement.<\/p>\n

Kim Kardashian was paid $250,000 by the creators of EMAX for a post to her more than 250 million Instagram followers: <\/em>\u201cAre you guys into crypto????.. This is not financial advice, but sharing what my friends told me about the Ethereum Max token! A few minutes ago, Ethereum Max burned 400 trillion tokens\u200a\u2014\u200aliterally 50% of their admin wallet giving back to the entire E-Max community.\u201d The price of EMAX eventually plummeted by approximately 97%, and the SEC rewarded Kardashian with a fine of $1.26 million for not disclosing to her followers that she received money for the promotion.<\/p>\n

Adin Ross, a Twitch streamer, went live promoting MILF token. MILF token was a project that aimed to create a vibrant \u201cmeme ecosystem\u201d that tied together both tokens and NFTs (non-fungible tokens, essentially verifiable unique digital assets), which included launching an NFT project called \u201cCyber MILFs\u201d. In a live stream, Ross spent 15 minutes buying MILF tokens. It is estimated he was paid nearly $200,000 for the promotion (which he disclosed during the video, saying, \u201cI\u2019m getting paid for this\u00a0shit\u201d).<\/p>\n

Later, Ross said in a video, \u201cBy the way, that MILF Token shit I did a while back? I already told you guys don\u2019t buy that shit\u2026. I got paid a bag to do that shit. Like, I don\u2019t give a fuck. I hope none of you guys actually bought.\u201d MILF coin would subsequently crash in price to be trading near $0 at the time of\u00a0writing.<\/p>\n

The rapper Soulja Boy, famous for his debut single \u201cCrank That Soulja Boy,\u201d was paid to promote the shitcoin \u201cSaferMars\u201d (not to be confused with SafeMars). Soulja Boy was supposed to tweet to his more than five million followers: \u201cFound an interesting project @safermars<\/a>\u200a\u2014\u200alooks moon worthy. $SFM<\/a> Presale is now live on @dxsale<\/a>.\u201d However, he accidentally botched the tweet, including details of how much he would earn if the project successfully raised funding, stating: \u201cThey raising 240k, if they raise it after your tweet\u200a\u2014\u200awill get you\u00a024k.\u201d<\/p>\n

Soulja Boy quickly realized his mistake and deleted the\u00a0tweet.<\/p>\n

Organized pump and dump\u00a0groups<\/strong><\/p>\n

Organizing pump and dumps wasn\u2019t the sole domain of project teams. With shitcoin after shitcoin following a boom-and-bust cycle, it seemed like buying a shitcoin was like buying a lottery ticket. You would either win big or lose it all. But what if you could rig the game to buy the winning\u00a0ticket?<\/p>\n

This was the genesis of several large pump and dump groups that sprung up between 2020\u20132022. Typically organized through the Telegram messaging app, the group would function as follows: One of the group\u2019s administrators would select a shitcoin to invest in. The group would then accumulate a holding in the cryptocurrency and go out \u201cshilling\u201d the cryptocurrency across social media networks. Shilling would often involve the spread of false information about the cryptocurrency (e.g., the project is in negotiations for a deal with Microsoft) or low-effort tweets and posts like \u201cthis is going to the moon\u201d with a few rocket emojis added for good\u00a0effect.<\/p>\n

The goal of the group was straightforward. Spread the word about the shitcoin and hope unsuspecting individuals invest in the cryptocurrency\u200a\u2014\u200araising the price and volume traded (the \u201cpump\u201d). Once the shitcoin had pumped, the group would collectively sell the token on the market, causing the price to collapse. This would leave the investors holding onto \u201ca bag\u201d\u200a\u2014\u200acrypto parlance for holding tokens that have lost almost all their value. These groups could have a tremendous impact on price and volume. In a report to the Australian Securities Investment Commission, University of Technology Sydney crypto researcher Professor Talis Putnins gave an example where pump and dump groups increased the price of a token by 90% in less than a minute. These schemes distorted around 65% of price trends on average, with abnormal trading volumes and unfair wealth transfers across investors.<\/p>\n

Pump and dump schemes are illegal, being a form of market manipulation. What is most interesting is how openly these groups operate, allowing anyone to enter and even calling themselves a \u201cpump group\u201d. Those who join often think they are getting an edge on the market. However, the structure of the group can mean these joiners get scammed themselves.<\/p>\n

Many pump and dump groups operate in a hierarchical structure\u200a\u2014\u200awith an inner group and an outer group. The inner group typically consists of a small number of founding members, responsible for deciding which shitcoin the wider group will buy. What is not disclosed to the outer group is that the inner group will quietly acquire the shitcoin before publicly posting about it. The inner group, therefore, acquires the shitcoin at a lower price, and when the outer group starts purchasing the shitcoin, the inner group can start dumping on them. In effect, it\u2019s the creation of a pump-and-dump scheme within a pump-and-dump scheme.<\/p>\n

Shitcoins morph into real-life squid\u00a0games<\/strong><\/p>\n

In the smash hit Netflix series Squid Game<\/em> released in 2021, a group of players accepts an invitation to compete in a series of children\u2019s games to win a large cash prize of $35 million. Unbeknownst to the contestants, the games are a life-and-death scenario. But for every death, another $80,000 is added to the prize pool. After the first game, the players narrowly vote in favor of sending all contestants back home without any prize money. However, after a short period, most of the contestants decide to return to the game. They know the odds are stacked against them but choose to roll the dice\u00a0anyway.<\/p>\n

Squid Game<\/em> formed an interesting parallel to the shitcoin era. While many unsuspecting investors were convinced to purchase worthless cryptocurrency, a large contingent knew precisely what they were buying. The self-styled degens knew they were playing a form of squid game. Many would even openly brag about how much money they had lost (posting loss porn pics) or joking on Telegram how many rug pulls to which they had fallen victim. Losses and rug pulls became a badge of honor in the community. These degens treated shitcoins as a casino\u200a\u2014\u200ayou win some and lose some\u200a\u2014\u200aall with the hope that the next shitcoin they purchased would be the next SafeMoon, and they could retire\u00a0early.<\/p>\n

The analogy to Squid Game was not lost on some. In late 2021, a cryptocurrency inspired by the show was launched, called \u201cSquid.\u201d The project promised to create a crypto game at some point in the future. Of course, investors immediately rushed in, with the price rising from one cent to a touch under $3,000 in less than a week. To put that in perspective, if you had invested $100 in that coin on Monday, by Sunday, you could have quit your job and bought a penthouse in the Bahamas with a nearly $30 million\u00a0return.<\/p>\n

True to its inspiration, the shitcoin, of course, ended up being a rug pull. The project developers were able to make off with an estimated $3.38 million, crashing the price of the token in the process by\u00a099.99%.<\/p>\n

The end of the shitcoin\u00a0era<\/strong><\/p>\n

Squid, in retrospect, became one of the closing chapters in the 2020\u20132021 shitcoin era. Shortly after the Squid rug pull, Bitcoin would hit approximately $64,000\u200a\u2014\u200arepresenting the top of the crypto market. As 2021 drew to a close, the era of cheap (mainstream) money that spurred on the shitcoin bubble was also ending. The central banks\u2019 rapid increase in money supply through quantitative easing in traditional money markets, and near-zero interest rates, combined with a range of pandemic-related supply constraints to unleash an inflationary storm around the\u00a0world.<\/p>\n

For years, the near-zero interest rates had encouraged a mad dash to speculative investments. With interest rates on savings accounts next to nothing, investors searched for yields in increasingly risky assets. With inflation starting to rise by the end of 2021, central banks inevitably had to respond by raising interest rates and ending quantitative easing programs.<\/p>\n

This coalesced into a \u201crisk off\u201d mentality amongst investors, leading to falls in tech shares and crypto more broadly. With prices falling, the fear of missing out (FOMO) that had driven so much speculation in shitcoins started dissipating. Increasingly, investors were more concerned with the fundamentals of the project in which they were investing, reallocating capital to legitimate crypto projects. As investor Warren Buffett said, \u201cOnly when the tide goes out do you learn who has been swimming naked.\u201d Shitcoins had been swimming naked, and when the music stopped, all that was left of these projects was a worthless number of tokens sitting in investors\u2019 wallets.<\/p>\n

The aftermath<\/strong><\/p>\n

In retrospect, it is easy to look back at the shitcoin era in 2020\u20132021 and conclude that the market was irrational. In many senses, this is a correct interpretation\u200a\u2014\u200awhen SafeMoon can reach a market capitalization of more than $5 billion, it\u2019s clearly not a sustainable market. The price of coins like SafeMoon are dictated by the marginal buyer. At some point this demand will dry up, and in the absence of any fundamental value, the price will inevitably fall from astronomical valuations.<\/p>\n

Many investors lost money from scams and rug pulls, as well as investing in shitcoins at the peak of their valuation. However, a large number of these investors viewed their investments as completely rational. They were not content with a steady 8% return on the S&P 500 index fund\u200a\u2014\u200athey wanted generational wealth. Instead of gambling at a casino, they gambled with shitcoins, rolling the dice and hoping their next investment would be the new SafeMoon. Viewed from this angle, what other investment could potentially return over 1,000% in the space of just a few\u00a0days?<\/p>\n

Notwithstanding this view, the shitcoin era can hardly be considered a high point for the crypto space. Shitcoins and rug pulls and the many investors who were burned during this period have left the nascent industry grappling with the perception that the entire technology is a scam. Nevertheless, the power of the \u201cmeme\u201d in crypto would endure. As crypto market conditions improved in late 2023, investors would once again flock to meme coins. While not quite reaching the highs of the 2021, a new class of meme coins would\u00a0appear.<\/p>\n

On the Solana blockchain network, a class of political meme coins emerged, tracking the US election. Influenced by the \u201cDoland Duck\u201d meme, meme coins were created for US presidential candidates. This started with \u201cDoland Tremp\u201d and \u201cJoe Boden\u201d giving buyers a de facto bet on their preferred presidential candidate. The meme coins would move roughly in sync with their candidates\u2019 chances\u200a\u2014\u200awith the Doland Tremp coin rising rapidly after Donald Trump survived an assassination attempt. Conversely, the Joe Boden coin collapsed once Joe Biden announced he would no longer be running. This then caused the \u201cKamala Horris\u201d meme coin to spike when she became the Democratic nominee for president.<\/p>\n

Other dog-themed meme coins also reaching staggering valuations, including the \u201cdogwifhat\u201d coin\u200a\u2014\u200aa variant of the dog meme, this time equipped with a hat. Another dog-themed meme coin \u201cBonk\u201d emerged, rising to a more than 1 billion valuation. With the price of Bonk rising, this created a strange arbitrage opportunity in the market. People could buy and sell in different markets to take advantage of price variations.<\/p>\n

The aforementioned Solana chain released a crypto-focused smart phone called \u201cSaga phone\u201d which had a preinstalled crypto app and a specific crypto-related app store. The Saga phone had lackluster sales, only selling around 2,500 units up until early December 2023. Not even a price drop in August 2023 from $1,000 to $599 could boost sales. However, fortunes quickly turned. Saga phone holders were eligible to receive 30 million $BONK tokens by downloading an app on the phone. In June 2023, the 30 million $BONK tokens were worth roughly $10. As the price of $BONK started increasing in December, the value of the tokens surpassed $1,000. This meant in effect that you would make money if you purchased the phone. Savvy individuals quickly capitalized on this opportunity, with Saga quickly selling out (including nearly 15,000 units selling in just one day). The sold-out phones quickly appeared on eBay for almost 10 times their sale price. Phone buyers were also the recipients of other, free tokens and NFTs, equating to more than $30,000 in\u00a0value.<\/p>\n

While most investors might view these coins as a gamble, one cannot discount the community aspects that emerge from meme coins. People can directly participate in their preferred candidate\u2019s election bids, or the opportunity to own a piece of a new social trend, or simply to have a group of people to chat to on the meme coin\u2019s Discord or social media channel. For better or worse, shitcoins and meme coins appear to be a permanent part of the crypto landscape.<\/p>\n

*******<\/p>\n

Purchase Magic Money now:
Paperback: <\/em>https:\/\/geni.us\/Magic_Money_Paperback<\/a>
ebook: <\/em>https:\/\/geni.us\/Magic_Money_ebook<\/a><\/p>\n

The Rise of Shitcoins | Excerpt from \u201cMagic Money\u201d<\/a> was originally published in Coinmonks<\/a> on Medium, where people are continuing the conversation by highlighting and responding to this story.<\/p>","protected":false},"excerpt":{"rendered":"

The following is an excerpt of the first chapter from my book \u201cMagic Money: The Rise of Crypto Degens, Rug Pulls, and a Digital Revolution\u201d Purchase now: Paperback: https:\/\/geni.us\/Magic_Money_Paperbackebook: https:\/\/geni.us\/Magic_Money_ebook ******* Chapter 1: The Rise of Shitcoins \u201cA cryptocurrency with little to no value or a digital currency that has no immediate discernible purpose.\u201d\u200a\u2014\u200aInvestopedia\u2019s definition […]<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-39977","post","type-post","status-publish","format-standard","hentry","category-interesting"],"_links":{"self":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts\/39977"}],"collection":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=39977"}],"version-history":[{"count":0,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts\/39977\/revisions"}],"wp:attachment":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=39977"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=39977"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=39977"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}