[Feature] Meme Coin BONK to the Rescue! But is it Really Solana’s Saviour?

What comes to mind when you think meme coins? Probably some of the more popular or dominant ones like Dogecoin (DOGE) or Shiba Inu (SHIB). As of late, there has not been any new meme coins entering the scene, but that changed when BONK, the new kid on the block, entered the scene.

BONK is a new Shiba Inu-themed meme coin in the style of DOGE or SHIB and takes pride in being the first Solana Dog coin. It was airdropped to a variety of SOL NFT holders, DeFi members, art collectors, and SOL developers, so if you do not actively follow the SOL development, you might not have heard of it.

On its website, it states that “Bonk is the first Solana dog coin for the people, by the people with 50% of the total supply airdropped to the Solana community.” Over the past 48 hours, SOL price has increased 34% while BONK has climbed 117% in the past 24 hours based on data from CoinMarketCap (it only began trading at the tail of December 2022).

Some crypto market participants attributes BONK’s growth to SOL’s price action. SOL’s price plummeted to its lowest level since February 2021 last week and it also saw various projects departing the ecosystem after the FTX collapse. SOL had been plagued by multiple hardships ─ one of its most notable backers is the disgraced ex-CEO of FTX, Sam Bankman-Fried (SBF); Serum, a decentralised exchange (DeFi/DEX) on the Solana blockchain announced its closure; Phantom, a Solana-focused crypto wallet added Ethereum and Polygon compatibility; leading NFT companies leaving its blockchain which included DeGods and y00ts (the process should be completed in Q1 of this year).

Then just before Christmas, a BONK coin giveaway was launched to reward everyone who supports the Solana blockchain. And just yesterday, it saw an 18.6% increase in 24-hour fees and 15.8% increase in 24-hour daily active users. On top of that, the price rallied above $14 for the first time since 14 December 2022. At the time of writing, it is trading at $13.25.

Source: Token Terminal (SOL fees and daily active users)

In a graph shown in Twitter user Joe Weisenthal’s post, he commented that “Solana is up 33% in two days as newly launched dog coin BONK gains community hype.”

Well, one of the main reasons behind its soaring price is probably the massive BONK burning. Yesterday, the team announced that the allocation that was supposed to go to the DeGods NFT project has been burned ─ 500 billion BONK tokens were wiped off the market. This resulted in a price soar. The BONK/SOL trading pair also saw a huge 24-hour volume of around $20 million.

It may just be a meme coin but the increasing demand is a positive sign for the Solana blockchain. As for what Vitalk Buterin wished for, Solana just might get a “chance to thrive.”

As with many memecoin projects, the team has remained anonymous and the website does not have much details other than the one-pager and the links to BONK-related resources. Whether this meme coin has reached its peak or it is far from done with its rally, remains to be seen. But while it has certainly gained steam, it is likely that BONK will reach a point where it is unable to sustain the hype and maybe even share a similar fate to other meme or dog-focused coins that often see a pump, then a steep dump and minimal to zero recovery.

Is it truly the saviour of SOL or will it join the ranks of the countless meme coins that have become obscure? When the hype is over, all will be clear. In the meantime, it is a fact that it has aided the Solana ecosystem in gaining momentum. As to how long it will last? Only time will tell.

Disclaimer: The content in this article is solely the author’s opinion and based on research; it is by no means financial/investment advice and is purely for educational/informational purposes only. DYOR and invest only what you can afford to lose.