Asset manager VanEck has made an entry into the meme coin space with the launch of an index that will track the performance of the foremost meme coins. This is undoubtedly a signifcant development considering the wider adoption these tokens could enjoy as a result of this.
What VanEck’s Meme Coin Index Is About
VanEck’s MarketVector meme coin index is called ‘MEMECOIN.’ It will track the performance of the six largest meme coins by market cap. This includes Dogecoin (DOGE), Shiba Inu (SHIB), Pepe (PEPE), Dogwifhat (WIF), Floki (FLOKI), and Bonk (BONK). The index weighs these altcoins based on their market cap.
Therefore, Dogecoin and Shiba Inu will hold the most value in the index, with weightings of 30.64% and 28.01%, respectively. Meanwhile, Pepe, WIF, Floki, and Bonk will weigh 14.18%, 13.29%, 7.17%, and 6.21%, respectively. The index ensured that each coin’s weighting was capped at 30% to diversify risk.
VanEck emphasized the risk associated with this category of crypto tokens, given how volatile they are. Meme coins are known to be largely driven by hype and social media sentiment which makes them susceptible to rapid price fluctuations. Irrespective of that, VanEck’s move underlines the wide-range recognition and acceptance that these meme coins are beginning to enjoy.
Time To Correct The Inaccuracies
Meme coins have mainly been criticized for lacking utility and having no future in the crypto space. However, that hasn’t been the case, as these crypto tokens have continued to thrive and enjoy increasing popularity as each day passes. These coins have also begun to see their utility increase.
Recently, automobile company Tesla disclosed to its customers that they can now pay for certain merchandise with Dogecoin. This is in addition to other use cases that the foremost meme coin already enjoys. For example, the NBA team Dallas Mavericks also accepts Dogecoin as a payment method.
Meanwhile, Shiba Inu has also stood out with its layer-2 network Shibarium and other innovative projects executed in its ecosystem. The Shiba Inu team also recently raised $12 million from notable venture capitalists (VCs) to build a layer-3 network focused on promoting users’ privacy.
As Justin Sun noted, these altcoins also highlight the power of community in the crypto space. It is the efforts of their respective communities that have pushed them to such heights, with meme coins like Dogecoin, Shiba Inu, Pepe, and WIF currently in the top 50 crypto tokens by market cap.
It is also worth noting that best-performing assets among the top 50 crypto tokens are meme coins with WIF leading the pack with a year-to-date (YTD) gain of over 1,800%.
DOGE price struggles to hold up | Source: DOGEUSDT on Tradingview.com
Featured image from LinkedIn, chart from Tradingview.com