I’m going to expand on what I posted on Twitter a few days back (link). The idea was to address Murad (@MustStopMurad)’s cult coin strategy for selecting memes.
He’s made $24 million with memes and his strategy has been everywhere on crypto Twitter and YouTube podcasters (on-chain source).
Our team watched all the hours of his videos we could find and organized his strategy into 20 theses.
I’ve also provided a philosophical framework to lend his arguments the coherence they might not otherwise have--and yes, a core philosophical position (relatively close to Jurgen Habermas) takes a prominent role in his thesis.
Philosophical Framework
1. Modern society is suffering from a lack of “product-market fit” for religion. The statistics on declining religious participation are many and undeniable.
2. In eras past, religion served to organize our lives by shared values and offered opportunities for socialization, romantic interaction, access to education, support for child care, and financial opportunities by way of networking (among other things).
3. As religious participation declines, these various services are unbundled. Some of those services are offloaded onto apps (e.g., dating apps), others onto the nation-state (e.g., child care), and others are “falling through the cracks.”
4. One of those functions that has “fallen through the cracks” is community formation--the ability of individuals with like interests to join in support of those pursuits.
5. Modern complex societies that operate by way of a free market (capitalism) are coordinated (to the extent that they are) by legal standards (to prevent harmful interactions) and financial incentives (for positive interactions). There are no other mechanisms (such as shared religious values) to coordinate the interactions of billions of anonymous individuals.
6. Because we do not have any other way to incentivize positive interactions among people who would otherwise be strangers, no long-term communities are formed unless they make sense financially. Even our romantic lives (e.g., marriage) are only sustained if they are productive economically.
7. Please note: this isn’t a criticism of capitalism, just a description. No claim is made that some other system is better. The point is this: if capital is the primary driver of positive interactions (not belief in a commonly shared religious value), then profitability proves a necessary criterion for any long-term relationship or community.
8. What cryptocurrencies have done is tokenize community relationships. That’s their killer app. The Bitcoin community needed to exist in a cohesive enough way for one man to pay another 10,000 BTC for a pizza.
9. Yes, there are real use cases for some coins. BTC is now a store of value. Stablecoin payments actually work. Meme coins enable people to gamble (if nothing else). AI projects will benefit from decentralization. Real World Asset projects will benefit from both blockchain and decentralized technologies. Gaming NFTs and tokenization simplify the economies in games unlike any Web2 solutions could. But for any of that to exist (and most of it is a promise for the future), you need a community first.
10. Most people don’t understand the technology behind crypto. Most retail investors don’t care either. They want to make money and they’d like a community of people to share that success with. That WAGMI stuff of the last cycle (we’re all going to make it) was aspirational at least.
11. Meme coins have a better product-market fit than most alt-coins do, given the above needs. They do not require a specialized understanding of cryptography or neural networks. And they do very directly provide a community.
12. Meme coins have two additional benefits over altcoins by avoiding the distorting effects of venture capital. (1) Most of the gains for alt-coins have already been made by the time they list on an exchange that non-experts could use. Retail is now VC exit liquidity. Since one of the key features of a community is that it must be profitable, VC alts have a built-in mechanism to degrade any community’s longevity via unlocks. Meme coins, by contrast, have fair launches or close to fair launches. (2) There is more equity in a meme coin community than in a VC-backed alt-coin (e.g. APT or ICP).
13. The above contextual points suggest rules for selecting successful meme coins.
Meme Coin "Investing" Rules
14. Rule 1: You want “value” driven cult coins. That is to say, you want coins that rally members around a certain value. Notably, animal coins are unlikely to do that, which is why Murad doesn’t like most animal coins (he did hesitate on MooDeng’s potential viability).
15. Rule 2: These cults may be divided into sectors. Murad watches the following: (1) Movements, (2) Masculinity, (3) Culture, (4) Frogs, (5) Cats, (6) Schizoid, (7), Phrases, and (8) Countries. He doesn’t like celebrity coins because they might not form the right kind of following and the same point holds for political figures.
16. Rule 3: Only invest in meme coins that are on established chains. He only likes ETH and SOL. This is quite different from Crash’s “flow” thesis -- to pick the chains with the highest likely future flow. Crash (@CrashiusClay69) thus prefers Base, TON, and Tron.
17. Rule 4: In selecting potential cults, always prefer coins with real memes outside the crypto world. Pepe makes sense, for example. Murad doesn’t like Pepe because it’s already big, but it’s an example of what he’s looking for.
18. Rule 5: Pick the leaders in those sectors. You are betting on cult success, so go for strength of cultiness. You can check for this by doing “deep dives” into each community. How active are they? How many are making their own memes? Do they have mantras? Do they have a philosophy of sorts? Do they exclude people who don’t agree with them?
19. Rule 6: look for coins in the $50m to $200m market cap range that have had at least 2 dips and survived. The size setting is so that you can actually make money. The “dips” criterion is to make sure that the community is cult-ish enough to survive crashes and come back.
20. Rule 7: buy and hold your top coins until they reach ridiculous proportions (like $10b in market cap). You’re betting on cults, after all, so if they’re successful, they’ll reach at least half of what SHIB did last cycle.
Final Observations
Given all of that, Murad likes the following: movements ($SPX), masculinity ($GIGA), Culture ($MOG), Frog ($APU), Cat ($POPCAT, $MINI), schizoid ($RETARDIO, $BITCOIN), Phrase ($LOCKIN), Country Coin ($USA).
I do think that $MOTHER, strangely, is part of the “masculinity” culture group. Iggy has taken on the role of “bad bitch” in the social imaginary of the “Giga Chad” universe and that would explain why her coin has held up so well v. basically any other celeb coin. Notably: CardiB just entered the fray with her own coin $WAP (Twitter support here).
Similarly, Murad’s opposition to the Boys Club is only that $PEPE is large. But it seems silly to avoid buying other coins in that universe that are much, such as $BRETT...or even much smaller, $WOLF. The latter could do 100x and reach “only” $160m market cap.
Anyway, to round this out: none of this is financial advice. DYOR. They're meme coins and could all go to $0 (most do), so don't invest what you can't afford to lose.
Happy Trading!
- Sebastian Purcell, PhD
