The Rise of Meme Coins: How Dogwifhat and Pepe Outperformed Bitcoin in 2024’s Crypto Rally

The first half of 2024 will be remembered as a remarkable period for digital assets, marked by the debut of spot bitcoin exchange-traded funds (ETFs). However, several lesser-known cryptocurrencies stole the spotlight, outperforming bitcoin in the process.

Bitcoin’s 48% rise in the first half of 2024

According to CoinGecko, the market value of all cryptocurrencies rose by $661 billion in the first six months of the year, with bitcoin accounting for $409 billion of that gain. While bitcoin’s 48% rise was impressive, it was outdone by several “meme coins,” tokens with little intrinsic value whose prices tend to fluctuate wildly as traders pile into and out of the coins.

The Top Performers

Dogwifhat, an aptly named token whose logo is a Shiba Inu in a knitted beanie, is the top returner of the roughly 70 coins with market caps over $1 billion, gaining about 1,300%. Pepe, a token named for the meme frog often associated with fringe-right circles, is the next best first-half performer with a nearly 800% gain, according to CoinMarketCap.

Floki, a coin named for the Shiba Inu dog belonging to Elon Musk, and a coin just known as Shiba Inu, are up 418% and 67%, respectively, similarly outgaining bitcoin.

Beyond Meme Coins

Several tokens that do not fall under the meme coin umbrella also posted bitcoin-beating rallies, including ether (up 51%), the ethereum network’s token which could be approved for ETFs akin to bitcoin’s as soon as this summer, and Binance Coin (up 81%), the coin often abbreviated as BNB which is issued by the world’s largest crypto exchange and owned primarily by Binance’s embattled billionaire founder Changpeng Zhao.

What Is A Meme Coin?

There’s no hard and fast rule as to what constitutes a meme coin, but it’s typically considered a cryptocurrency which is tied to a viral internet joke and whose price moves even more severely than the already volatile asset class.

“Meme coins may capture the public’s fancy today and be gone tomorrow,” BankRate analyst James Royal cautioned to CNBC. “If demand dries up, you’ll be left with only worthless digital assets and a good story,” Royal added.

Key Background

First minted in 2009, bitcoin and the broader crypto market surged in popularity and value during the COVID-19 pandemic, rising from a March 2020 low of close to $4,100 to a Nov. 2021 peak of almost $69,000. The industry then endured 2022’s brutal “crypto winter” marked by a slew of high-profile bankruptcies from the likes of Sam Bankman-Fried’s FTX, causing bitcoin to fall below $16,000 in late 2022.

The crypto market then stormed back as broader market conditions improved and investors grew excited at the prospect of the spot bitcoin ETFs, which have brought in around $15 billion of new capital in their first five months of existence, according to Bernstein analysis.

The rise of spot bitcoin ETFs

Bitcoin peaked at $73,768 in March. It now trades about 15% below that peak but is still outperforming the S&P 500 stock index year-to-date.

Surprising Fact

Despite the rise in value for several other cryptocurrencies, bitcoin hit its most dominant level since the first half of 2021 this year, according to CoinMarketCap. Bitcoin accounts for more than 55% of the global crypto market’s aggregate market value, up from 40% at the end of 2022.

Bitcoin’s dominance in the crypto market