Inside the 2021 Meme Coin Mania: TikTok Hype, Safemoon, and the Rise of the Shitcoin Economy

By late April 2021, roughly three months into the latest wave of FOMO, speculative low-quality tokens showed no sign of slowing down. Traders kept posting outsized gains even as much of the crypto community dismissed the trend as scams and cash grabs — confident their own projects were fundamentally sounder and that the run would inevitably collapse. The pattern felt familiar, prompting an uncomfortable question: had crypto's own insiders become the skeptical old guard they once mocked?

Crypto veterans have long enjoyed mocking meme-coin buyers as naive, even though grifts and low-effort scams are common throughout the industry. Part of the derision may function as a kind of virtue signaling — a way of publicly distancing oneself from low-status trades — but the underlying question remains whether TikTok-driven retail traders were simply outperforming the maximalists at their own game of making money.

Investors buying tokens built for attention rather than utility were reportedly pulling in millions in profit. The moment drew comparisons to the 2017 ICO boom, except short video clips have replaced whitepapers as the pitch format, and the projects behind them require even less development effort — arguably with a bit more transparency about what they actually are.

Tokens such as Safemoon, Scamcoin, $Ass, and $Cummies make little pretense of serving any real purpose, yet each pulled in millions of dollars within minutes as traders scrambled to get in early on tokens engineered purely to attract attention.

A week before this piece was published, Andre Cronje wrote "Bull market, Bear development," and Safemoon's own GitHub repository served as a case in point: a single Solidity file with just two commits made on the same day was all that stood behind a token whose market cap reached the millions and whose fully diluted valuation reached the billions of dollars.

The TikTok Investors Twitter account grew to 105,000 followers in roughly eight months, a rise plausibly fueled by the appeal of feeling more informed than other traders — though there was also speculation that the account's operators were accumulating positions in tokens before featuring them.

Meme-coin trading favors early entrants and project creators, who benefit from a "build and dump" cycle that Binance Smart Chain's low barriers to entry have made especially easy. Everyone else buying in is effectively playing a game stacked against them, since insiders holding large allocations have little incentive to support any long-term vision for tokens that took only hours to deploy. Even so, a handful of meme coins have proven durable enough to end up traded even by Alameda.

TikTok appears to function as an even more volatile and unpredictable market signal than Twitter, and given the growing pool of capital flowing in from new retail investors, some form of TikTok-based momentum tracking seemed like a plausible next development. The dynamic mirrors familiar patterns from outside crypto, where gambling's appeal splits between the very wealthy and the most desperate — producing something resembling a casino or a betting shop, where most participants chase price candles while a smaller, more cynical group watches from the sidelines.

01Marketing Over Technology

Social media, more than protocol design, is what moves meme-coin markets. Whether or not a token is fungible in principle, holding it still leaves a permanent trace on a wallet address. As argued in the earlier piece "Time as Money," buying a meme coin resembles buying a moment in time — each token functions as a kind of souvenir marking what was culturally relevant at that point.

The act of buying confers value onto the meme itself and shapes how it's perceived. Similar to the "degenscore" concept from atomic.blue, holding meme coins can signal a certain depth of engagement with the space — evidence that a holder has moved past merely accumulating blue-chip assets and has the time, capital, or curiosity to buy tokens with comparatively little inherent value.

Seen this way, wallet histories function as a kind of behavioral profile, a permanent public record of decisions made. Decades from now, when economists study the "DeFi summer" era in hindsight, they'll be able to note — with the benefit of knowing what came later — that it was a poor decision for address 0x12345 to buy 100,000 $Ass tokens at 11:34:12 AM UTC on April 26, 2021, since a later entry point would have been cheaper.

Regardless of whether a trader holds meme tokens, blue chips, or stablecoins, everyone participating is playing variations of the same overall game — one in which crypto traders broadly can claim to have outperformed hedge funds, an industry that remains satisfied simply to still be in business:

Performance remains strong in 2021 after the Hedge Fund Research Index returned 11.8% in the year ended Dec. 31, the best return in a decade, data from Hedge Fund Research Inc., Chicago, showed.