$BONK: The Meme Coin Narrative
Understanding how Solana's Doge took the market by storm
You’ve probably heard of BONK- the new meme token on Solana. If you haven’t- it’s a dog themed crypto on Solana, similar to dogecoin that’s taken the market by storm.
Money is flowing not only from traders on Solana, but from Ethereum too. Started by a completely anonymous team, it’s being hailed as Solana’s DOGE with the token doubling almost every day.
It’s revived the Solana ecosystem- bringing in liquidity and pumping $SOL itself. At its peak, BONK had almost $200M in daily volume of trade and had catapulted into a top 200 coin by market cap.
I think its worthwhile to dive a little deeper into how BONK got here.
Part-1: The airdrop
On 25th December, thousands of wallets received an airdrop of BONK, worth <$10 at that time. Alpha groups noticed this and started speaking about it. The airdrop was based on active wallets, holders of certain projects and members of certain DAOs: basically active folks from the community.
There was a pump (after the initial dump because people got free tokens) but big money was still not getting in at this time. Few people were aware of BONK in the larger community but most knew the memes surrounding it. Most folks who knew it (mainly from the Solana community) were skeptical as it had dumped post airdrop and then witnessed some small pumps- they were afraid it might go to nothing.
Part-2: Initial pumps
There was concern that it could be a rug- but the project had not sprung out of nowhere and launched a token the next day- they’d built up a presence since the beginning of December- which had inspired at least a little faith. And besides, people loved the meme.
Initial pumps were witnessed when a few Solana influencers started shilling it. The token pumped over 100% but there were dumps too- mass hysteria was yet to hit everyone.
Early investors did get anything from a 2x to 10x but the real euphoria which makes a 100x was yet to come. The whole crypto community needed to rally together for that.
Part-3: Further pumps and peak euphoria
Once a coin captures market sentiment, everyone wants a piece. BONK started getting attention in the last couple of days of 2022 after continuously going up- but volumes started coming in during the first few days of January. Earlier BONK was a coin that was only on the radar of the Solana community as the coin was traded mainly only on Jupiter, a DEX aggregator on Solana. But post the Coin gecko and Coinmarketcap listing, ETH money started taking notice. Certain centralized exchanges too listed BONK such as Huobi and Bybit.
Money started flowing in from other ecosystems (mainly ETH). This chart below showing the surge in new Solana wallets is an indication of money flowing in from ETH. (20k+ wallets were added in a week after the airdrop)
Actual integrations started being built and partnerships that the BONK team had worked on started giving fruit. Almost every Dapp on Solana was integrating BONK and even MagicEden, the largest NFT exchange teased a potential integration.
Even Frank, the founder of Degods, who had been critical of BONK came around and showed his support.
Here’s a thread that goes a little deeper on some of the utility and use cases that Bonk had started to garner.
Part-4 The dump
When your neighbor's heard of the meme coin everyone’s talking about on twitter, that’s probably a good signal of the top.
Well, everyone was trying to get in on BONK and there were people who believed it just wasn’t possible for it to go up anymore- so they started shorting it (certain exchanges had enabled futures trades on BONK). With it’s meteoric rise, it was inevitable. Bonk had returned a 15,000% return to some early investors- with the token’s fully diluted valuation at its peak being 1/10th of Solana’s. But a token can only pump so much.
And so it began. BONK began dumping heavily on Thursday- over 50%, losing over $100M of market cap in under 12 hours. It made a decent recovery but then proceeded to dump again making newer lows.
This might not be the end of BONK though. The team is working around the clock to make BONK what it could be. Recently they burned 5% of the supply which had been kept with them- a very bullish sign for the community and it showed their commitment to actual build the project and not just cash out from it.
What worked for BONK
Incidentally, the mission statement that bonk has adopted is in-line with what the Solana community needed at the moment. Support.
With Degods, the largest NFT project on Solana moving out and the FTX scandal (SBF was one of the largest backers of the ecosystem), Solana was at its weakest. Token price had made its way to the low two digits and there was apprehension and worry from the community.
BONK was what the community needed; to just give up on all the worry and rally behind what the ecosystem meant to them.
BONK team has actively been speaking to projects in the ecosystem- trying to build partnerships and collaborations with everything from de-fi protocols and crypto casinos to major Solana NFT projects. They’ve been pretty successful too- as you can see from this list of integrations.
BONK’s airdrop strategy has also been pretty well-built out. They targeted active people from the community rather than going for random Solana wallets. Wallets that were early traders on the Openbook DEX for example, were given 15% of the airdrop. Similarly, tokens were airdropped to holders of certain NFT projects, members of certain DAOs and so on. By doing this, they involved the Solana crypto right from the beginning.
Apart from this, there’s of course the memes and the culture.
$BONK would have been most profitable if you’d gotten in early. Finding narratives is much easier when you have curated social alpha. That’s what we’re trying to build at Supermind. Help us out by trying our beta and letting us know what you think.
Conclusion
Bonk is a tale of the people, just as the twitter bio of the project proclaims. It shows that no matter how fundamentally strong a project is, it cannot moon unless people rally behind it. And what better way to rally people behind a project than through memes.
Communities exist for almost all projects- but euphoria is achieved when every crypto user becomes your community.
And Bonk is a case of what happens when you build a strong community and culture. Truly, the token of the people on Solana.
Until next time!