What exactly is a meme coin? Casino chips, cultural totems, or a financial truth detector?

From the billion-dollar myth born from Shiba Inu meme packs to Elon Musk’s casual tweet causing Dogecoin to surge 30%, Meme coins are truly a love-hate phenomenon. You might say they are bubbles, and indeed, they have enabled many early investors to achieve financial freedom; you might say they have value, but most projects ultimately end up zeroed out.

Today, let’s look at it from a different perspective—comparing Meme coins within the framework of traditional finance, perhaps we can find some insights.

From a Market Perspective: It’s a High-Grade Lottery

Frankly, buying Meme coins is psychologically similar to playing the lottery.

Spending tens of dollars on a ticket, betting on a tiny chance to hit 5 million; throwing hundreds of dollars into a newly launched Meme coin, betting it will rise 100 times. The difference is, a lottery draws a single winning number, while Meme coins have ongoing “draws”—today a KOL endorses it, tomorrow the community burns tokens, the day after it gets listed on an exchange—each event could be a trigger for a price surge.

Essentially, it’s a gamble on fools. Most people buying Meme coins don’t care about technical roadmaps, use cases, or team backgrounds (many projects are completely anonymous). The core logic is simple: will someone buy it at a higher price from me?

Some might say, isn’t this just like “penny stocks” or “junk bonds”? On the surface, yes, but the risk dimensions are entirely different.

Penny stocks in Hong Kong, at least, are backed by real companies with assets and operations, even if wildly overvalued, they are still under regulatory oversight. Junk bonds have high default risk but can be analyzed through credit ratings, collateral, and cash flow forecasts.

Meme coins? Most have no whitepapers, smart contracts may contain fatal vulnerabilities, and founders can “pull the rug” at any time—these systemic risks have no equivalent in traditional finance.

From a Cultural Perspective: It’s a Pass for Identity

If Meme coins were just gambling tools, they would have died long ago. What keeps them alive is their cultural attribute.

Remember the “GameStop” saga in 2021? Retail investors on Reddit banded together to short Wall Street, turning GME stock into a “symbol of resistance.” Holding GME was no longer just an investment; it was a declaration of identity: “I am part of the WSB community, fighting against the financial elites.”

Meme coins take this play to the extreme.

Take Dogecoin, for example. Starting as a joke mocking Bitcoin in 2013, it has evolved into a symbol of “people’s currency” with a global community. Shiba Inu is even more exaggerated, creating the “SHIB Army,” using ShibaSwap, NFTs, and metaverse narratives to maximize holders’ sense of belonging.

In this system, investing isn’t cold data analysis but a warm community-building activity. Early adopters of promising tokens can not only profit but also accumulate “social capital”—people think you have good taste, are trendy.

This social capital can even drive the price in reverse. Community members create memes, do creative content, and generate buzz—all for free, injecting “cultural valuation” into the project. So the value cycle of Meme coins looks like this:

Community culture creates attention → Attention attracts capital → Price rises reinforce belief → Belief spurs more cultural output

This bottom-up value creation is almost impossible in traditional finance.

From a Historical Perspective: Another Tulip Bubble

Speculative bubbles are nothing new in financial history. Meme coins are simply a reenactment of this script in the blockchain era.

In 17th-century Holland, tulip bulb speculation saw prices where one bulb could buy a house, driven by narratives of rarity and status; in 2000, the dot-com bubble valued companies based on user growth rather than profits, fueled by “new economy” narratives; today’s Meme coins are entirely built on “community power” and “cultural symbols.”

Elon Musk’s tweets outperform any earnings report. What does this tell us? Human nature hasn’t changed—we’re always attracted to compelling stories and dreams of quick riches.

Every bubble shares a common trait: the frenzy of “FOMO” (Fear of Missing Out). When you see peers getting rich overnight from Meme coins, rational thinking quickly gives way to anxiety. In the 24/7, information-saturated crypto markets, this emotion is amplified to the extreme.

And each era finds reasons to say “this time is different.” Tulip mania claimed the demand for beauty was infinite; the internet era argued traditional valuation models no longer apply; the Meme coin era claims community is value, and decentralization changes everything.

But history repeatedly shows: music stops, narratives collapse, prices revert to intrinsic value—most Meme coins’ values are approaching zero.

What’s Truly Different

While many analogies exist, Meme coins leverage blockchain technology to innovate in some ways.

Incredibly low barriers. Traditional finance requires underwriters, regulatory approval, complex procedures, high costs. On-chain? You can create a coin with just a few dollars in gas fees, in ten minutes. This ultra-low barrier fuels wild market growth and results in a mix of projects—some legitimate, many scams.

Global liquidity. While OTC penny stocks in the US may have days with no trading volume, top Meme coins listed on decentralized exchanges or major CEXs are traded 24/7 worldwide. This deep liquidity provides perfect conditions for high-intensity speculation.

Regulatory vacuum. Traditional finance has strict investor protections; in crypto, often it’s a “lawless zone.” Lack of regulation fosters innovation but also enables market manipulation and scams—“buyer beware” is pushed to the extreme.

Final Thoughts

Meme coins are like a mirror reflecting the underlying elements of the financial system—speculative desire, tribalism, herd mentality. They turn Wall Street’s high-frequency game into a全民狂欢, and elite social networks into global digital tribes.

Rather than simply condemning them as “scams” or praising them as “revolution,” it’s more accurate to see them as a complex, multifaceted phenomenon:

• For gamblers, they are digital casinos
• For young people, they are cultural identities
• For scholars, they are living experiments in behavioral finance
• For regulators, they are gray areas in urgent need of regulation
• For society, they are modern parables about technology, human nature, and greed

Most Meme coins may eventually vanish like bubbles of the past, but the lessons they reveal—community-driven value creation, cultural narratives influencing finance, technological advances promoting financial inclusion—may long influence our understanding of “finance.”

In the ongoing collision and integration of traditional and crypto finance, the seemingly absurd spectacle of Meme coins might just be that sharp, unmistakable note—dissonant but impossible to ignore.