Shitcoins: How Did Term Originate In Crypto World?

Shitcoins, we can say this is another name for meme coins or a category of them.

These coins can be tempting to invest in because of their lower prices and hype on social media, but it’s crucial to understand them first.

This blog puts a perspective on the world of shitcoin. We will see what makes them different from established crypto coins.

Also sheds light on the dangers of investing in them, how they gain popularity, and the tactics used to hype them.

What are Shitcoins?

The term ‘Shitcoin’ itself is slang directed towards highly speculative cryptocurrencies that offer little to no value on investments.

These coins rely on social media hype, memes, community following, and even endorsements from public figures.

Unlike established crypto coins like Bitcoin and Ethereum, shitcoins lack functionality, have a limited use case, and have a bare minimum value.

Characteristics of Shitcoin

• Low Value: The use case of owing a shitcoin doesn’t provide any significance to anyone but instead can be a reason for a loss because they are even more volatile than regular cryptos.
• Viral Marketing: Shitcoins utilize social media to the fullest extent to create viral and trendy posts about them to make their project look legitimate.
• Anonymous Developers: A good number of developers behind their respective shitcoin projects are anonymous, inexperienced, or scammers altogether.
• High Volatility: The prices of shitcoins fluctuate wildly, even more than regular crypto coins, and developers may even launch the project entirely, leaving investors with losses.

While some shitcoins do experience price surges temporarily, the vast majority of shitcoins are unlikely to become long-term options.

Pros and cons of Shitcoin

Just like any other type of investment, shitcoins have their own set of pros and cons that everyone must know.

Pros:

• Diversification: Some shitcoins can become an opportunity for investors to diversify their crypto investments; they also have a very low correlation between their valuation and that of established crypto coins.
• Entertainment: The ultimate motive of meme coins and shitcoins is to have fun and engage with their happening community.
• Short-Term Gain: A good motive behind investing in shitcoin is the possibility of experiencing a moonshot, meaning where prices skyrocket due to hype or unexpected adoption.

Cons:

• Risky: The vast majority of shitcoins are valued well under even 1 USD, so their underlying value and dependency on social media hype make them a risky investment.
• Rug Pull: Under this, developers abandon the project after witnessing a surge in price, leaving investors with useless tokens.
• No Use: Most shitcoins don’t have a real-world use case because their valuation is driven by speculation and trends, which makes them susceptible to crashes when the hype fades.

How do Shitcoins work?

They might look all fancy on social media, but reality can often be disappointing. Here’s the lifecycle of shitcoins:

• Origin: The idea of any particular shitcoin can come from anywhere, be it a meme, a parody of an existing coin, or capitalizing on a hot trend.
• Hype: Social media is the launch pad. Promoters create accounts to spread memes and marketing material about their project.
• Launch: A platform or exchange gets chosen to get the coin launched, and investors can buy it during the initial coin offering (ICO). This is where investors collect funds.
• Price Fluctuations: The prices of shitcoins are incredibly volatile, driven by social media hype and a coordinated ‘pump and dump’ scheme where early investors can inflate prices artificially to only sell them later at high prices, leaving latecomers to losses.
• Maintenance of Hype (or Not): Some projects attempt to create a use case or portray some form of development to sustain the interest of the users.
• Potential Rug Pull: The worst-case scenario would be developers abandoning the project entirely (a rug pull) after getting all the funds from investors.

Mentioning the top 8 shitcoins, of which even Dogecoin is part.

List of the Top 8 Shitcoins

• DogeCoin: The one that started it all, the OG Dogecoin, which is a Shiba inu (dog breed) themed coin, started as a joke but got instant success.
• Shiba Inu: Inspiration coming from Dogecoin; this is a puppy version of Shiba dog.
• Floki Inu: Another dog-themed coin to capitalize on the trending pet crypto coins.
• MonaCoin: Lucky Cat based on the coin in a market with abundant dog-themed coins.
• SafeMoon: ‘Controversial’ coin that promises an all-round ecosystem but lacks a clear use case and trust from the users.
• TrumpCoin: Of course, the inspiration behind this coin is Donald Trump, and it has a volatile history.
• Deez Nuts Coin: Based on viral internet slang, this shitcoin aims to add a bit of humor to the crypto world.
• Banano: This coin powered by DAG technology is a fearless and quick alternative to the other coins.

Conclusion

The crypto market offers a wide range of investment opportunities, and shitcoins are just a part of it.

With their risky characteristics and speculative nature, it is more of a gambling investment for the users.

Doing research and evaluating every crypto project that one wants to invest in can pave the way for profits.

Frequently Asked Questions

Q1: What are shitcoins?

Shitcoins are poorly developed cryptocurrencies with little to no value.

Q2: How can I identify a shitcoin?

Look for projects lacking whitepapers, anonymous developers, and meme-inspired projects.

Q3: Are shitcoins a good investment?

Generally, no. They are high-risk investments with low potential returns.

Q4: How can I avoid investing in shitcoins?

Research before investing, stick to reputable projects and consult experts.

Q5: Can shitcoins ever increase in value?

There is always a possibility, but it’s rare. Proceed with caution.