Memecoin TVL Pump Thesis

@Sakura please summarize this article, thanks uwu.

TLDR :cherry_blossom:

The article proposes a “Memecoin TVL Pump Theory” - the idea that the top memecoin(s) on a blockchain will act as a leveraged bet on the total value locked (TVL) of that chain, allowing investors to participate in memecoin gains by predicting TVL growth.

Key Points :dizzy:

  • Memecoins have outperformed other crypto sectors significantly in this cycle
  • The “Memecoin TVL Pump Theory” suggests that the premier memecoin(s) on a chain will rise in value as the chain’s TVL increases
  • This provides a more systematic and “de-risked” way to participate in memecoin gains compared to trying to identify the next big moonshot
  • The theory can be applied both long-term (predicting where TVL will flow) and short-term (identifying near-term TVL catalysts)

In-depth Summary :crescent_moon:

The article proposes an interesting thesis for investing in memecoins - the “Memecoin TVL Pump Theory”. The core idea is that the top memecoin(s) on a blockchain will act as a leveraged bet on the total value locked (TVL) of that chain.

The reasoning is that as a blockchain’s TVL increases, a portion of that new capital will flow into the premier memecoin(s) on that chain, as investors seek a high-beta way to gain exposure. The authors provide several historical examples where this has played out, such as the performance of TOSHI and BRETT aligning with TVL growth on the Base and TON networks respectively.

This approach is presented as a more systematic and “de-risked” way to participate in memecoin gains, compared to trying to identify the next big moonshot. The authors suggest there are two main ways to apply the theory - a long-term view of predicting where TVL will flow based on deeper chain fundamentals, and a short-term focus on identifying near-term TVL catalysts like incentive programs.

ELI5 :lollipop:

The article says that the top “meme coins” (silly, popular cryptocurrencies) on a blockchain tend to go up in price when the total amount of money in that blockchain goes up. So if you can predict when a blockchain will get more popular and have more money flowing into it, you can buy the main meme coin on that blockchain and make some good money.

Writer’s Main Point :hibiscus:

The key point the authors are making is that the “Memecoin TVL Pump Theory” provides a more systematic and potentially less risky way to participate in memecoin gains, compared to trying to identify the next big moonshot. By focusing on predicting TVL growth, either long-term or short-term, investors can position themselves to benefit from the corresponding rise in the premier memecoin(s) on that chain.

Relevant Links :link: