If you want to understand memecoins, you have to start by accepting that they exist for the same reason conspiracy theories exist: people like feeling smarter than the system, even when they’re the ones getting played.
Memecoins aren’t financial instruments. They’re ideological Rorschach tests disguised as currency. A certain kind of person looks at them and sees generational wealth; another kind sees the financial equivalent of a house of cards built on an earthquake fault line. But the thing about house-of-cards economies is that the first people to leave the table win. Everyone else is just part of the con.
The people who buy into memecoins genuinely believe they’re either in on the joke or about to pull off the greatest financial heist in history. They think they’re about to become the guy who bought Dogecoin at $0.0001 and held it until it hit $0.70. They think this because the entire ecosystem of memecoins runs on vibes—specifically, the vibe that if you throw a few hundred dollars at a shitcoin with a dog on it, you might wake up a millionaire.
But here’s what they don’t think about: Memecoins are an endless game of chicken where the only way to win is to make sure someone else loses. And the losers, overwhelmingly, are the ones who think the game is about making money, rather than about finding a greater fool before they themselves become the fool.
Rug Pulls: The Inevitable Third Act of Every Memecoin
Every memecoin ends in a rug pull. It’s just a matter of when, not if. Maybe it happens when the creators siphon liquidity and vanish like a magician slipping out of a cheap handcuff trick. Maybe it happens when a whale who got in early cashes out, imploding the entire market. Maybe it happens because the coin’s entire purpose was to simulate financial Darwinism in its most brutal form: “Congratulations, you held the bag the longest. Now the bag is worth zero.”
And yet, people keep buying in. They buy in because, at some level, memecoins are a distillation of the purest human fantasy—the idea that you can get rich without doing anything. This is an old fantasy. The lottery, multi-level marketing, day trading—every generation finds its own version of the get-rich-without-effort mirage. The difference now is that the internet lets that fantasy spread at the speed of memes, and you don’t even need a PowerPoint deck or a fake Rolex to pull it off. All you need is a website, a white paper full of nonsense, and a Twitter account run by someone who types in all caps.
Why Are People Still Falling for This?
Because memecoins exploit a very specific kind of FOMO—the fear that everyone else is getting rich except for you. The same psychology that made people buy Beanie Babies for hundreds of dollars in 1998 makes them buy a token called $FROG69 because some influencer tweeted that it’s going to the moon. People don’t want to miss the next big thing, even when the next big thing is a garbage fire visible from space.
The Endgame
Memecoins are a Ponzi scheme where the victims and the perpetrators are often the same people. They aren’t investments; they’re reverse lotteries—a game where millions of people throw in their money, and a tiny handful of people actually walk away with a fortune. But for every one person who made millions off Dogecoin, there are a hundred thousand people who bought in too late and watched their money dissolve into internet dust. The difference is that the losers never get magazine covers or viral tweets.
And maybe that’s the most fascinating part. The memecoin space isn’t a financial market. It’s a casino where everyone thinks they’re the house. And in the end, the house always wins.
