This is not the first attempt by another blockchain to reach out to the memecoin sector. Avalanche, Hyperliquid, Fantom, Base, and Blast have all embraced the Memecoin Supercycle. The general trend seems obvious, and Tron is the latest instance demonstrating it. 

But here’s the question: will Tron’s newfound love for memecoins kickstart a new memecoin frenzy within the Tron ecosystem, or is it destined to fail just like many other attempts we’ve seen previously?

Let’s find out.

Disclaimer: This is not financial or investment advice. You are responsible for any capital-related decisions you make, and only you are accountable for the results.

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Intro to Tron

Tron is a layer-1 blockchain platform (similar to Ethereum and Solana) that aims to build a free, global, and permissionless system to decentralise the web. It was launched in 2017 by the Tron Foundation, specifically Justin Sun, a high-profile crypto figure known for his earlier involvement with Ripple.

Initially, Tron was founded to make content storage, distribution, and consumption more democratic and less controlled by centralised entities like large tech companies. For example, in 2018, the Tron Foundation acquired BitTorrent, a move aimed at integrating blockchain technology with one of the world's largest file-sharing networks.

However, over time, it evolved into a general-purpose blockchain suitable for hosting applications ranging from DeFi to AI. 

Let’s talk about Tron’s memecoins

Recently, Tron made a strategic move to embrace memecoins, aiming to leverage the viral nature of these digital assets to boost network activity, user engagement, and overall adoption of the chain.

To facilitate this pro-memecoin stance, Sun launched SunPump, a token generator platform on Tron that allows anyone to create a memecoin with little to no effort.

We have long been advocating for the Memecoin Supercycle, and it is not surprising to see many pivoting to memecoins after seeing the adoption they brought to the Solana ecosystem.

However, the critical question is whether there is an opportunity or what you should do after the 2nd biggest blockchain by TVL started its memecoin journey.

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Could memecoins drive growth in the Tron ecosystem?

The shift to embrace memecoins and boost network activity has sparked a new wave of memecoin creation and trading on the Tron network.

Almost 60,000 new memecoins were created on SunPump within three weeks of launch. Despite massive initial success, the growth has flattened, potentially indicating fading momentum.

SunPump itself generated almost $3.9 million in revenue within the same period. However, similar to the number of tokens created, the revenue, which had skyrocketed initially, also lost momentum a couple of weeks after launch.

TLDR: despite the intentional efforts to push memecoins on Tron, it appears that the strategy isn’t working out so far. 

While revenue of the Tron network has spiked, the number of active users hasn’t experienced significant change over the last couple of weeks after the announcement. The data suggest no considerable number of users bridged to the Tron network, potentially invalidating Justin Sun’s thesis of getting further adoption via memecoins. 

However, we also note that it might be too early to come to firm conclusions about the impact of memecoins just yet.

However, the pivot was positive for Tron's native token, TRX. It saw a significant price increase of over 25%, suggesting the market believes that memecoins can drive further growth within an ecosystem and that embracing memecoins was the way to go.  

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The bullish case for Tron memecoins

 The role of memecoins cannot be understated when it comes to SOL’s success. The Solana ecosystem benefited tremendously from the visibility and allure of memecoins, which allowed many to experience all the innovative platforms on Solana, such as DEXes, lending markets and liquidity management platforms, for the first time after a long and painful bear market.

Unsurprisingly, many see Tron memecoins as the new development that may follow the trend of the Solana memecoin frenzy. 

So why are people bullish on memecoins on Tron?

Tron shares similar characteristics with Solana: it is scalable, cheap, and very fast to transact. However, the adoption and ecosystem development has been lagging relative to Solana or Ethereum.

Many view the potential rise of memecoins on the Tron network as the one thing that can help Tron overcome the adoption chasm and open a new chapter in the development of the chain.

Further, even though Tron is moving towards memecoins, it is taking a slightly different approach to the memecoin push than Solana– at least culturally. 

Prioritising artistic expression in memes

Justin Sun, the founder of Tron, has emphasised the importance of narrative and artistic style in memecoins, which can help to differentiate Tron's memecoin offerings and carve out a niche in the market. 

Endorsements from notable artists like Beeple and Zeng Fanzhi add a layer of cultural capital to these digital assets, potentially attracting a different demographic to the space. Tron focuses on visual appeal and artistic expression when it comes to meme development.   

In contrast, Solana’s memecoin ecosystem has been chiefly dominated by animal and narrative-driven memes (e.g. PolitiFi). 

Thus, many view the rise of memecoins on the Tron network as a bullish development and reprising the TRX token in the meantime.

But can Tron sustain its momentum like Solana did, or is it another failed attempt to capitalise on the memecoin supercycle?

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Our analysis of Tron memecoins

So far, the most popular Tron memecoin, SUNDOG, reached a market cap of over $250 million in the past few weeks. It is the best-performing memecoin in the Tron ecosystem. 

Sure, the growth is impressive. However, we have not seen the 80% drawdown and how it recovers. Further, we have a couple of concerns—almost half of the liquidity isn’t locked, meaning the price can tank aggressively at any time due to low liquidity. Further, despite the massive market cap, the holder number is still tiny, just reaching 10k holders recently.

This analysis on SUNDOG can be extended to the broader TRON memecoin ecosystem; it is young and has yet to go through massive volatility and the test of time. 

In addition,  it needs to foster memes with locked liquidity and organic holder growth. Memecoins without locked liquidity have a high chance of rugging. 

These insights point towards the nascency of the memecoin market, which has yet to grow and develop. Thus, we haven’t yet seen an organic memecoin market formed on Tron that many big players can play around in. 

Controversies 

However, all memecoin ecosystems were once young, so recency is not enough reason to be concerned about memes on Tron. 

So, let’s dig into the other concerns. There are some inherent risks associated with the Tron ecosystem. 

Justin Sun is a very controversial figure in the crypto market. Over the years, the SEC and other governments have accused him of wash trading, money laundering, and Ponzi fraud.

In addition, there are reports and claims that the main algorithmic stablecoin of the Tron ecosystem, with a market cap of $750m, isn’t backed by external assets such as Bitcoin and other blue-chip crypto coins. USDD, the stablecoin on Tron, is now mostly backed by TRX, Tron’s native gas token. However, such an approach proved unsustainable and dangerous, as demonstrated by the epic failure of Luna/UST. 

Stablecoin is an integral part of any blockchain ecosystem. The failure of any of them permanently damages the chain (see Fantom and Terra). The potential failure of USDD and its broader impact can be a considerable risk for anyone to jump on the memecoin wagon within the ecosystem.

The controversies and risks have already impacted the perception of the Tron ecosystem and can hinder the growth potential of the memecoin market there. Thus, we believe serious capital will hesitate to enter the ecosystem and bring further adoption. 

Inorganic memecoin markets

Lastly, we don’t think a top-down approach to memecoins will work. Memecoins on Solana became a thing naturally; Anatoly (Co-founder of Solana) or Solana Foundation didn’t force them. The market itself sorted things out and chose Solana as a playground and home for the hottest memes of this cycle. 

Other L1 chains that tried to force memecoin mania have failed. For example, both the Avalanche Foundation and Andre Cronje (the leading developer of Fantom) conducted campaigns and tried to push its community towards embracing memecoins. However, neither experiment yielded the expected results. Memecoins should be naturally embraced and promoted by the community and not forced on them from above.

When it comes to Tron, the memecoin shift is being pushed from top to community as well. Thus, we remain sceptical of Justin Sun’s attempt to ignite meme vibes. It will likely lead to sub-optimal results relative to the expectations, just like in other ecosystems.

At this stage, we believe betting on memecoins in the Tron ecosystem is too risky and potentially can lead to significant losses.

Now, if we don’t think you should buy Tron memes, what other new memes should you buy instead?

We are bullish on Solana memes, and we’ve found another one that might play out nicely.

Introducing…

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Smoking Chicken Fish (SCF)

Imagine, if you will, a chicken, but not just any chicken. 

This one has the head of a fish and is not content with being a bizarre hybrid. It's puffing on a cigarette like it's contemplating the meaning of life or perhaps the next big pump in its market cap.

Jokes aside, the meme caught our attention with its strong performance and potential for virality. It positions itself as the first official religion on Solana, with weekly church times on Wed/Sat at 8pm. The narrative is fresh and can go viral.

It passed a rug test, and the token's distribution looks good relative to its market cap. Despite its strong performance, we have been waiting for it to experience an 80% drawdown and see whether it can recover after weak hands are washed out. 

As we anticipated, it crashed 80% after a very strong performance and is now showing signs of recovery.  

Technical analysis

Whilst there is a zone of support between $0.0377 and $0.0466 that could be an area to bid, we would look to bid more heavily if the price deviates below the horizontal support of $0.0377 and into the Yellow Buy box between $0.0297 and $0.0377. 

If the price were to revisit $0.0199, that's where we'd bid much more aggressively. 

Here are more details about the token

• Blockchain network: Solana
• Market cap: $46.8m
• Number of holders: 11,577
• Contract address: GiG7Hr61RVm4CSUxJmgiCoySFQtdiwxtqf64MsRppump
• Recommended entry zone: $0.0297 to $0.0377
• Most preferred entry price: $0.0199

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Cryptonary’s take

Tron's recent pivot towards memecoins marks an interesting phase in the ongoing memecoin supercycle. 

Despite a surge in token creation via the SunPump platform, overall network adoption hasn’t matched financial metrics, suggesting waning initial enthusiasm. The network's revenue and user growth are stagnating after a brief spike.

Other red flags on Tron memecoins include a limited number of holders, liquidity not being locked, and inorganic price action. The controversies around Justin Sun, legal accusations, and lack of confidence in backing Tron’s algorithmic stablecoin only add to the scepticism.

Lastly, three weeks is too short to make any definitive calls. Given the nascent stage of Tron's memecoin market and the associated risks, committing substantial capital is premature. 

We strongly believe you’ll still have the best odds of memecoin success with Solana memes. If you want a shiny new memecoin, check out Smoking Chicken Fish on Solana and prepare your capital for the next entry. To be clear, SCF is not yet on the same pedestal as WIF and POPCAT; the short-term target is to reach the $100 million market cap. We will then reevaluate the project and publish a standalone report at that time. Until then, don’t fumble the bag.

Cryptonary, OUT!