Memecoins, led by Shiba Inu and Dogecoin, the two largest memecoins by market capitalization, have emerged as the unexpected frontrunners, boasting an unprecedented surge in returns amidst the crypto market’s recent upsurge.
Data unveiled by CoinGecko on Wednesday showcased memecoins’ staggering 1,312% average returns in the first quarter of 2024, a feat that outpaced gains made by traditional crypto assets such as Bitcoin, Ethereum, and Solana combined.
According to a blog by the firm, the surge of meme coins was underscored by their dominance as the most profitable crypto narrative in Q1 2024. The firm noted that meme coins were the most profitable crypto narrative, citing an average return of 1,312.6% across the top tokens in this category.
Notably, the rise of meme coins was buoyed by the emergence of new tokens, including BRETT and BOOK OF MEME, which contributed to the narrative’s robust performance. BRETT, in particular, saw an astronomical gain of 7,727.6% by the end of Q1, solidifying its position as a standout performer in the memecoin arena. Additionally, the viral sensation surrounding Solana-based meme coin dogwifhat (WIF) propelled its gain of 2,721.2% quarter-to-date, fueling the ongoing fervour surrounding meme coins.
The exceptional profitability of meme coins starkly contrasted with other crypto narratives, underscoring their dominance in the market. The firm further emphasized that meme coins were 33.3 times more profitable than the Layer 2 narrative, with the lowest returns in Q1 this year.
While meme coins stole the spotlight with their remarkable performance, other crypto narratives also experienced notable gains during the same period. RWA, which saw returns of 286%, briefly held the title of the most profitable narrative before being surpassed by meme coins.
Meanwhile, the AI narrative recorded a robust 222.0% return, with coins such as Bittensor (TAO), Render (RNDR) and Fetch.ai (FET) experiencing robust growth over the past 3 months.
Meanwhile, despite the dominance of meme coins and the strong performance of other narratives, some categories lagged in terms of profitability. Layer 1, gaming, and Layer 2 narratives posted relatively lower returns than their counterparts, highlighting the varied landscape within the crypto market.
“Layer 2 (L2) has started the year as the least profitable crypto narrative, with a significantly lower 39.5% gain. Across the large-cap L2 coins, established Ethereum L2s underperformed the most: Arbitrum (ARB) had 5.6% returns, Polygon (MATIC) saw 1.2% and Optimism (OP) closed the quarter with a slight decline of 1.2%.” The firm noted.
CoinGecko’s report echoes recent sentiments shared by former Bitfinex CEO Arthur Hayes, who lauded meme coins as drivers of growth and innovation in the crypto landscape. Hayes emphasized the pivotal role these assets play in broadening the scope of the crypto realm, underscoring their capacity to allure new participants while infusing the market with an element of enjoyment and enthusiasm.
