Murad Mahmudov: Is a Shiba Inu and Dogecoin Supercycle Coming?
Crypto expert Murad Mahmudov has long been drawing attention on X for his preference for memecoins.
Crypto expert Murad Mahmudov has long been drawing attention on X for his preference for memecoins. At TOKEN2049 he gave a talk on his thesis and made a prediction: the memecoin craze in March and April this year was only a teaser, two more parabolic price surges will follow. He says PEPE, WIF and friends are in a supercycle - with negative effects on the price action of traditional crypto assets.
Private investors are harmed by “unfair” tokenomics
One of his View post on X is that token allocation at memecoin launches is generally much fairer, because insiders get a much smaller share than in altcoins with investors like venture capitalists. These early investors would take the full value increase of the token for themselves in private funding rounds and sell the coins and tokens to private investors when they are listed on a centralized exchange (CEX). These are often heavily overpriced right now. The reason for this is token launches under the policy of “low float, high FDV (fully diluted value)”, i.e., a low circulating supply but a high valuation when you account for coins yet to be issued. As a result, private investors usually take losses now.
Down only” applied to the price action of most coins and tokens launched in 2024 after their listing, source: Murad Mahmudov
Another critique of tech altcoins: there are simply too many of them. Since December 2021, their number has grown from 400,000 to 2.5 million. In 2024, more than 5,500 tokens were launched on average per day. According to estimates from Binance Research, by 2030 there will be more than $155 billion worth of tokens launched.
Memecoins in particular can be created more easily than ever thanks to launchpads like Pump Fun from Solana or Sun Pump from Tron. Most memecoins, however, already circulate at their total supply and will not dilute from future unlocks. Crypto investors are also aware of the near-endless creation of new memecoins. He believes a few winners will emerge that manage to gain durable market share and build a loyal community.
Furthermore he says: “The token is the product. The software is secondary, if not third tier.” The technology is thus not the decisive factor in most projects. The focus for all parties is on returns. And for private investors, returns are currently mostly weak, because they can’t buy altcoins at low prices like in the ICO era of 2017. Crypto analyst Sisyphus also criticized the business model of altcoins in this X post:
Lack of income is a feature, not a bug
Another critique of tech altcoins is that they haven’t paid out income to investors yet under the guise of regulatory uncertainty. According to Mahmudov, that’s not desirable, as it would clearly reveal the overvaluation of these assets. Many blockchains generate less than USD 1,000 in fees daily but trade for a fully diluted value (FDV) of more than USD 5 billion. Therefore, it’s not advisable to value them using traditional financial metrics like the price-to-earnings ratio.
For memecoins, it is generally not possible to value them using these metrics due to a lack of income and fundamentals. In the case of alts, protocol revenue according to these stats creates a floor for the coin’s price in the form of real value - good in a down market. Financial fundamentals also create a ceiling. Memecoins therefore have no upper bound in terms of price movement. So he sees the lack of income as a feature, not a bug.
Private investors aren’t interested in the tech
Crypto fans are often accused of only wanting quick money. There is some truth to this. The analyst sees this as a particularly important reason for mainstream participation in crypto. Most private investors are only indirectly interested (if at all) in the innovative power and technical specs of their projects. They focus on upside potential, fun factor, and community - exactly what memecoins offer.
He argues memecoins also have fundamental value. He says the prospect of profit-sharing for tech alts is offset by the sense of camaraderie in the community and the entertainment memecoins provide. Most of the valuation of both coins and tokens is driven by speculation and meme-plex anyway. Compared with NFTs, which also score with a strong community and entertainment factor, the native Azeri sees the advantage of significantly higher liquidity, since it’s harder to find a buyer for an NFT token because of its uniqueness.
He also emphasizes the importance of price trends and “rags to riches” stories - his stance: “If poor people don’t get rich, you don’t have a community.” Recently, for example, a trader turned only 800 USD into 9.4 million USD with the Nile Hippo memecoin Moo Deng. In CoinMarketCap’s top 300, only 43 tokens beat Bitcoin in 2024. Of the top 20 performers, 13 were memecoins. DOGE, PEPE, WIF, etc. have shown that these coins can rise to multi-billion market caps. Based on the momentum, he sees the memecoin craze continuing to rise.
Crisis and financial troubles as drivers
According to the trader, the reasons for the growth and rising popularity of cryptocurrencies in general have an even bigger impact on memecoins. The rise in consumer price inflation, the massive expansion of fiat money supply, and the widening wealth gap are seen as drivers of financial speculation. Developments in AI making many jobs redundant, increasing loneliness, worsening mental health issues, and the declining influence of religion are seen as reasons for the growing importance of communities.
This meaning crisis is amplified by sects, as seen in sports like yoga or CrossFit, video games like League of Legends, or diets like keto or veganism. They also show up in financial topics, for example among Tesla or GameStop investors. As more time is spent online, such communities are increasingly sought online.
But other crypto projects also have strong communities in some cases. Mahmudov argues memecoin communities offer more opportunities for participation than altcoins. But whether they really create that much more community and identity than tech alts is the question, since BTC maximalists and advocates of layer-1s like Ethereum or Solana are feverishly campaigning.
Uncertain future prospects
His critique can be summed up as follows: Coins and tokens other than Bitcoin are usually overvalued in his view - in some cases massively so. Private investors who are mainly after fun, community, and high returns are tired of early investors and the team dumping their altcoins on them. Moreover, most of them cannot prove the promised benefits of the protocol anyway.
Memecoins are designed to separate financial speculation from opaque blockchain ventures and enable a fairer form of online gambling with a fun factor - taking market share away from altcoins. According to the crypto analyst’s investing philosophy, you should focus on memecoins with a market cap of $5 million to $200 million and hold them for more than a year - he favors coins like SPX6900, GIGA, MICHI, and POPCAT.
Mahmudov’s critique of altcoin launches based on the “low float, high FDV” principle will likely resonate with many private investors. The question remains how many of these newly created memecoins will sustain online community and rising prices in the long term. And identifying these exceptions will probably be nearly impossible. That’s why investing in memecoins remains more important than any other investment category: Invest nothing you can’t afford to lose.
