It only takes 27 seconds to create a memecoin and what we need to think about

In the context that memecoin is the hottest keyword of the crypto investment community, the owner of a Twitter account has published a video recording the process of this person creating memecoin from A to Z, with a total duration of only 27 seconds.

memecoin deploy% speedrun (rug skip, autocomplete skip) 22.45s (WR)⏱️

Specifically, digital artist Johnny Shankman, whose Twitter account is whitelights.eth, posted a real-time clip of this person creating and deploying to the Ethereum network a token called "EASY_MONEY" ” in less than 27 seconds. A few days later, this record was broken by someone else, when he created a new  memecoin  in less than 23 seconds.

This type of clip is also known as a "speed run", where a gamer takes a real-time video recording of them completing a level or an entire game as quickly as possible.

To do this, Shankman uses the Contracts Wizard, developed by crypto security firm OpenZeppelin. The Contracts Wizard tool is designed with a simple and easy-to-use interface, allowing anyone to create an ERC-20 standard coin with just a few clicks. On the tool interface, users can optionally add or remove features for their tokens, such as mintable (ERC-20 compatible with additional features), burnable (the ability to "burn") , like memecoin Pepe also has this feature) or snapshot…

Token EASY_MONEY. Photo: Etherscan

After the token “EASY_MONEY” (EZ) was created, Shankman continued to use the Remix application to set up smart contracts for this memecoin and deploy it on the Ethereum testnet.

In the comments section below the video, Shankman emphasized that the purpose of making this token is only for "education", and that EASY_MONEY will only be on the Ethereum testnet and not a memecoin for anyone's investment needs.

And yet, in less than 24 hours after the video was posted, Twitter account "@0xdiid" also broke Shankman's record when creating a token called "lol" in just 22.45 seconds in just 22.45 seconds. , thanks to omitting a few features during creation.

Junk coins in the middle of the “season of memecoins”

Basically, as the name implies, junk coin is a mockery and demeaning call for any crypto coin that “meets” the following “criteria”:

• No intrinsic value
• Does not bring benefits to investors and consumers and the network
• Developed by an anonymous group or individual for the purpose of fraud
• Lack of support from the community
• The risk associated with price fluctuations is very high

The purpose of these coins is often the result of a joke, or worse, to serve the scam of the group or individual who developed it. As we learned above, memecoin was created very quickly by author Shankman and anyone can do it. Scammers also take advantage of the "memecoin season" trend to make huge profits from scams.

The core of the risk-prone memecoin is to incite the FOMO effect and make it easy for investors to lose money. According to Twitter account @ZachXBT, an expert in "exploiting" scams in the crypto community, Shankman's video and its reposts have received a total of more than 14,000 Twitter bookmarks.

"You guys just taught people how to rug, we're done," one user commented. Rug (full name:  Rug Pull) is an organized fraud, when the team developing a coin/token suddenly sells or withdraws all of the project's liquidity and then "disappears without a trace".

Indeed, because the creation of memecoins is done quickly, scam projects and phishing attacks  have mushroomed. Every day, on the social networks Twitter and Telegram, hundreds of junk coins are launched to trap users with very sophisticated tricks such as leaving the token name with the same path as the homepage, creating virtual money flow for FOMO effect. , tricking groups to promote...

Because "doing well" on the scam road, junk coins disguised as memecoins and DeFi projects keep raging. Not only does it hurt investors' wallets, but it also creates a very bad look for individuals new to the market, who are the most vulnerable.

However, not everyone thinks that the dissemination of Shankman's memecoin creation videos is bad. Twitter account @RepeatAfterVee commented, the more people see this video and understand how easy it is to create memecoins, the more cautious they become in their decision to invest in such coins.

This view is also shared by author Shankman as follows:

Once you know how these things (how to make memecoins) work, you're a little less likely to risk rugs, as you now understand more about their nature.
Johnny Shankman

A better view of memecoin
Memecoins from the point of view of the crypto world, they have become an indispensable culture in the market. Markets like real estate or stocks can't create wealth so quickly. Not only earning profits and rare position swap opportunities for investors, memecoins also create liquidity on the network and attract new cash flows. Thereby, contributing to promoting the crypto market to become more sustainable.

These memecoins have very high market capitalization. Source: CoinMarketCap

The most typical is the case of  Dogecoin (DOGE), a memecoin created by the couple Billy Marcus and Jackson Palmer.

This memecoin also started out as a joke at the time it was launched 10 years ago (2013), based on the cute dog Shinu Iba meme loved by global Internet users. Now, DOGE has a market capitalization of $10 billion, more than three times that of Swiss bank Credit Suisse, more than Dropbox, and roughly the same size as Western Digital.

In addition, behind DOGE, there is a great person like Elon Musk to support, the success of this memecoin cannot mention the name of the Tesla tycoon. In 2021, Elon Musk continuously showed his support for DOGE, which made investor confidence soar and money flowed massively into this memecoin. Even in March of this year, this billionaire once let DOGE take the place of Twitter's blue bird icon for a short time.

But not every investor or KOL in the market fully supports memecoin. In early March 2023, Ethereum co-founder Vitalik Buterin sold out his memecoin holdings worth $700,000.

Specifically, Vitalik sold a total of:

• 500 billion SHIKOKU (SHIK) for 380.3 ETH (~$595,448);
• 10 billion Cult DAO (CULT) for 58.1 ETH (~$91,021);
• 50 billion Mops (MOPS) for 1.25 ETH (~$1,950);
• 3.4 billion Bite (BIT) for 5.9 ETH (~$9,250).

Reason? Vitalik stated about them as follows:

For anyone making money (or DAO or anything else) in the future. PLEASE DO NOT GIVE ME TOKEN OR POWERS IN THE PROJECT WITHOUT MY AGREEMENT! I don't want to be that kind of place of power. Better yet, mint the tokens directly to a worthy charity (talk to them first.)

Vitalik Buterin, Founder of Ethereum

Signs of junk coin project
Promising an absurdly high return on investment (ROI)

If the team that develops the coin or token promises to give investors a return of 1000 times the initial investment, it is definitely a warning sign. In general, the saying “if something is too good to be true, it is true” is rarely false, especially when investors intend to put money into a crypto project.

Limit social interaction

If in the project's Telegram or WhatsApp group, investors see that only the admin can send messages, or the customer care system does not seem reliable, it could also be a junk coin project. Transparency in operations and communication is the first indicator to look at in any team behind a project.

Poor quality website and brand activity

Branding is a key aspect of marketing and attracting investors. Most scam projects just want to make money (and then disappear) as quickly as possible, so they will often spend very little on website building and branding.

The typical consequence is often a very bad website, copy-pasted images and typography, and no detail about the identity and information of the development team. Of course, there are still scam projects that do the opposite by: Spending a lot of money to make their website look as professional as possible. Therefore, investors need to carefully read the tokenomics/white paper of a project including memecoin before deciding to "put down money".

Also, don't forget to check the source code of the coin or token. Most crypto projects keep their code open. So any project is not like that, investors have the right to doubt it.

Not sure who the development team is

As mentioned above, the founder and technical developer of a reputable coin or token project is required to have a clear profile and background about who they are and what they do. If investors can't find any reliable information about them, it is likely that their crypto project is not reputable enough for us to consider down the money.

Epilogue

In 2018, Prodeum performed the classic Rugpull, embraced millions of investors' dollars and disappeared. Photo: New York Magazine

Thus, when it comes to fraudulent junk coins, it means empty promises, low return on investment, and many other risks to investors' own pockets. Human nature is always easily attracted to the exaggeration of economic benefits, so many people have become victims of these projects. Therefore, investors need to learn how to filter information to know what is real and what is not.

We need to always do research before deciding to invest in a crypto project. Investors must look at tokenomics, white papers, development team profiles, founders, and how the community around the project interacts and exchanges information. For memecoins, such information will rarely be fully updated, so investors need to check additional indicators such as on-chain cash flow or side information to verify.

When facing any suspicious-looking project that you cannot authenticate yourself, it is best for investors to keep their money in their wallets to stay away from scam tokens/coins.