VanEck portfolio manager Pranav Kanade believes that cryptocurrency projects should learn from the traits of memecoins in order to achieve success. In response to a Token2049 panel discussing memecoins, Kanade pointed out four key aspects that memecoins possess.
Firstly, Kanade highlighted the simplicity of memecoins, stating that many crypto projects over-complicate their tokens. He emphasized that time, capital, and attention are all scarce resources in the crypto space, with over 600,000 tokens launched in 2023 alone. Therefore, it is important for projects to have a clear token design and vision that brings wealth to token holders.
Furthermore, Kanade addressed the issue of locked tokens, which can lead to concerns among traders about potential dumps when these tokens are unlocked. He noted that projects with a high number of locked tokens often struggle with growth as early adopters sell off their holdings. In contrast, memecoins typically have their entire circulating supply unlocked from the beginning, creating a “high float” model with a lower, fully diluted valuation. Kanade suggested that projects should consider adopting this approach, with a small number of tokens locked for early adopters and investors.
Lastly, Kanade proposed a “hyper-transparency” approach, encouraging projects to reveal the cost basis of token purchases by venture capital funds. Such information is usually not readily available to the public, but Kanade believes that increased transparency could benefit the overall crypto ecosystem.
By emulating these key traits of memecoins, Kanade believes that crypto projects can increase their chances of success in the highly competitive and rapidly evolving crypto market.