Memcoins are taking over the market again: can Bonk (BONK) catch up with Shiba Inu?

Hundreds of memcoins appear monthly on the crypto market, but only a few become real stars. Some of these cryptocurrencies become the leaders in their niche, but not all retain their positions after rapid growth.

What is BONK?

Bonk is the leading memcoin in the Solana ecosystem and, as its developers call it, is "the first dogecoin on Solana created by and for people."

According to a statement on the project's official website, Bonk's developers were tired of Alameda's "toxic tokenomics" of manipulating the tokens of funded projects (something the company has been accused of repeatedly). They didn't have any serious goals, so they created the memcoin for fun, much like the creators of Dogecoin once did.

What makes Bonk stand out among other memcoins?

Bonk does not represent any original idea and just follows the successful Dogecoin and Shiba Inu memcoins. Their only significant difference is the use of different blockchains for transactions.

Like the other popular memcoin Shiba Inu, Bonk has no blockchain and exploits only the existing one. Unlike DOGE and SHIB, BONK exists only in one Solana network. Those, in turn, are available in many EVM-compliant networks. However, it is possible that wrapped BONK tokens may appear in other blockchains in the future.

The creators of Bonk remain anonymous, which has already become mainstream for such digital assets. From this, we can conclude that Bonk has no particular differences from many similarly typical memcoins, which is why many analysts urge caution when investing in this cryptocurrency.

BONK token

BONK is an SPL format token issued on the Solana network. SPL is a proprietary standard for issuing tokens on this blockchain, similar to ERC-20 or TRC-20. After launching in December 2022, the project creators distributed 50% of the initially issued BONK tokens in an airdrop to NFT users and DeFi traders in the Solana ecosystem.

The token appeared on exchanges at the end of 2022 — just before an uptrend in the market started. Throughout 2023, the price of BONK continued to rise.

In the last two months alone, from October to December, the BONK token grew by more than 11,000% from $0.00000017 to $0.00001897, and since the beginning of the year, the growth has amounted to more than 17,000%. One of the main drivers of the token's growth has been listing BONK on significant crypto exchanges such as Binance, Coinbase, ByBit and HTX (formerly Huobi).

Such a small price is due to the massive issue of tokens: about 60.8 trillion BONK are circulating on the crypto market. At the same time, the maximum token issue is 100 trillion BONK. However, the capitalization of this token exceeds $1.15 billion, and by this indicator, BONK ranks 59th among all cryptocurrencies, according to CoinMarketCap.

Following in the footsteps of Shiba Inu, the BONK team periodically conducts token burns: over the past year, the token supply, if CMC data is to be believed, has shrunk by about a third, as it stood at 94.1 trillion BONK at the beginning of 2023.

In December, crypto smartphone developers Solana Saga decided to incentivize sales of their devices by announcing airdrops for buyers. At first, it didn't cause a stir, as at the time, the reward amount was only $30 when the smartphone cost $600. However, as soon as it became known that the token rate had increased by more than 3000%, Solana Saga smartphones started flying around like hotcakes. This is not surprising because, after such rapid growth, the value of the BONK token airdrop rose to $1000. In other words, smartphone buyers were able to make a profit as well.

BONK token is integrated into various DeFi protocols, so its holders can become liquidity providers and generate revenue through lending or pharming on DEX exchanges. In addition, the token has integrated Magic Eden, the largest NFT marketplace in the Solana ecosystem, which has allowed BONK to be used for trading on its platform.

Why is BONK growing, and what are its prospects?

Each blockchain has its leading memcoin: Dogecoin has a blockchain similar to Litecoin, and Shiba Inu leads in Ethereum and other EVM-compliant networks. On the other hand, BONK has taken over as the memcoin leader in the Solana ecosystem, which could benefit it.

The fact is that Solana is currently one of the fastest-growing ecosystems in the crypto industry: just in the last three months, the project's capitalization has grown from $7.29 billion to $32.5 billion, and the SOL token rate has grown 5 times from $17.3 to $87.6. In December, Solana ranked 5th in capitalization, surpassing Ripple, and is still only $3 billion behind BNB. Solana also ranks 5th regarding the number of assets blocked in the protocols (TVL), which exceeds $1.2 billion, and beats Avalanche and Polygon on this indicator.

Given the already high interest in BONK and the active discussion of this memcoin in social networks and media, as Solana grows, the rate of this cryptocurrency may also follow SOL. In its recent forecast, VanEck predicted that Solana will become one of the top three cryptocurrencies in capitalization.

The project's red flags include the lack of auditing and the copycat memcoins' poor reputation. For one thing, most of them tend to collapse in value as quickly as they rise. To see for yourself, look at the SHIB and FLOKI memcoins graphs. Second, many of these projects involve rug pull, one of the most common scams among crypto project creators.