Dec 21, 2023 15:22 UTC
| Updated:
Dec 21, 2023 at 15:22 UTC
What is BONK ? Is BONK’S price increasing because of COINBASE Listing
BONK is a memecoin based on the Solana blockchain (SOL), which gained popularity after being distributed to the Solana community through an airdrop on Christmas Day, 2022. This cryptocurrency, featuring a Shiba Inu dog as its mascot, draws inspiration from the well-known Dogecoin (DOGE).
On December 8, Bonk (BONK), a dog-themed memecoin, rose to become the third-largest memecoin by market capitalization. This achievement placed it alongside other popular dog-themed memecoins, Shiba Inu (SHIB) and Dogecoin (DOGE), in the top three, surpassing Pepecoin (PEPE), a frog-themed memecoin.
Bonk’s market value saw a significant surge of 370% in the 30 days leading up to December 11. Its price increased from $0.0000028 to $0.00002. This growth rate notably exceeded that of SHIB and DOGE, which recorded increases of 20% and 35%, respectively, during the same timeframe.
The rising popularity of Bonk also positively impacted the sales of the Solana Saga mobile phone. Since the phone’s launch, owners of the Solana Saga were beneficiaries of a 30 million Bonk airdrop. The subsequent rise in the token’s value created a lucrative opportunity, as users purchased the phone to take advantage of the airdrop, selling the tokens for profit.
This development underscores the growing influence of Bonk in the memecoin market, not only outperforming its peers in terms of price growth but also driving consumer behavior in related tech products.
Understanding BONK in the Context of Cryptocurrency
Memecoins, like BONK, are cryptocurrencies influenced by internet memes, humor, and satire. Initially, these coins don’t have a specific practical purpose. However, as the community around a memecoin expands and gains popularity, there’s potential for developing an ecosystem centered on it.
BONK operates on the Solana blockchain, recognized as one of the top layer one (L1) blockchains globally. The vision for BONK, as outlined in its whitepaper, is to establish itself as the “community coin of Solana,” with widespread application across various decentralized applications (DApps). The goal is to challenge the dominance of “predatory VC (venture capital) tokens” that have impacted the broader Solana Community, aiming to return control to the community members.
Tokenomics of BONK
To achieve this, BONK has planned to distribute half of its entire supply to a diverse group within the Solana ecosystem, including NFT enthusiasts, DeFi traders, artists, and collectors.
BONK, a memecoin centered around the Solana ecosystem, achieved a significant milestone in 2023 by recording the largest pump on Coinbase for the year.
The anticipation and process leading up to a Coinbase listing are often more impactful than the listing itself. This was evident with BONK, which saw an astonishing 18,000% increase in its value during the period leading up to its inclusion in Coinbase’s listing roadmap.
Initially valued at $20 million towards the end of October, BONK’s market value soared to nearly $900 million by mid-December. However, it faced a 40% correction around this time.
The process of listing on Coinbase typically unfolds in three phases: the initial roadmap announcement, the confirmation of support, and finally, the commencement of full trading.
Following the roadmap announcement, BONK experienced a drop of up to 27% on other exchanges, while Bitcoin’s value remained stable. Approximately 18 hours after this announcement, Coinbase confirmed that BONK would be available for trading in US dollars the next day, around midday in New York.
In response, BONK’s value surged by up to 50% and then more than doubled in the 18 hours following its official listing on Coinbase. However, two days post-listing, BONK’s value briefly exceeded $2 billion before retracting by about 40%.
Even with its recent decline, BONK’s value remains almost twice as high as it was since its listing on Coinbase was confirmed last Wednesday.
Advantages of BONK
- Exchange Listings: BONK is available on several well-known centralized exchanges, including Coinbase, Binance, and KuCoin, enhancing its accessibility and credibility.
- Solana Ecosystem Integration: As part of the increasingly popular Solana ecosystem, BONK benefits from the growing interest in this platform as a viable alternative to Ethereum.
- Impressive Market Performance: In 2023, BONK’s value surged remarkably, recording over a 10,000% increase.
- Central Role in Its Ecosystem: BONK is poised to be at the forefront of an expanding ecosystem of decentralized applications (dApps).
- BonkSwap Launch: November 2023 saw the introduction of BonkSwap, a decentralized exchange within the BONK ecosystem.
- Liquidity Provision Earnings: Users have the opportunity to earn interest by providing liquidity on BonkSwap.
Disadvantages of BONK
- Large Supply: BONK’s total supply is a massive 100 trillion coins, which could impact its value.
- Meme Coin Volatility: As a memecoin, BONK is subject to the whims of market trends and could lose popularity as new meme coins emerge.
- Market Fluctuations: High volatility is a common trait among meme coins, making them risky investments.
- Anonymity of Creators: The lack of transparency regarding the team behind BONK raises questions about its governance and future direction.
- Limited Practical Use: BONK’s utility beyond the speculative market is somewhat restricted.
In summary, while BONK offers notable opportunities, especially within the Solana ecosystem and through its impressive market performance, potential investors should also consider its high supply, inherent volatility, anonymity of its creators, and limited utility before investing.
Where and How to BONK
- Using Traditional Payment Methods on CEX: BONK can be conveniently purchased on centralized exchanges (CEX) using debit cards, credit cards, digital wallets, or online banking. This method is user-friendly, especially for those new to cryptocurrencies, as it allows for direct fiat-to-crypto transactions. After purchase, you’ll need to transfer your BONK tokens to a cryptocurrency wallet if you wish to use them on decentralized applications (dApps).
- Crypto Swaps on DEXs: Alternatively, BONK can be acquired through crypto swaps on decentralized exchanges (DEXs). For instance, on a Solana-based DEX like Raydium, you can swap SOL tokens for BONK. Be aware that such transactions incur gas fees, payable in SOL.
Platforms to Buy BONK
- Centralized Exchanges (CEX): BONK is available on several CEXs, including:
- Coinbase
- KuCoin
- Binance
- Bybit
- Bitget
- MEXC
- Decentralized Exchanges (DEX): For those preferring DEXs, especially within the Solana ecosystem, BONK can be found on:
- Raydium
- Orca
- Jupiter
- OpenOcean
- BonkSwap
Special Note for Ethereum Users
Ethereum enthusiasts can engage with BONK by purchasing Wrapped BONK tokens. These tokens mirror the market value of BONK native to the Solana blockchain.
Important Considerations
BONK’s remarkable growth of over 10,000% in 2023 has naturally attracted significant attention. However, if you’re considering investing in this Solana-based memecoin, it’s crucial to conduct thorough research (DYOR), stay aware of the potential influence of FOMO (fear of missing out), and remember the inherent risks associated with trading meme coins.
All Coinbase Listings This Year Experience Initial Price Surges
While BONK’s significant price increase around its Coinbase listing might appear exceptional, it’s part of a broader trend observed with other cryptocurrencies. This year, Coinbase has added 15 different cryptocurrencies to its platform. Each of these, except for the Ripple-based smart contract network Flare (FLR), which remained stable, experienced a price rise in the period between Coinbase’s confirmation of their listing and the actual listing event.
Interestingly, Bitcoin, typically a market leader, only saw a rise of more than 2% in tandem with these cryptocurrencies on two separate occasions. This pattern suggests a minimal short-term correlation between Bitcoin’s price movements and those of cryptocurrencies newly listed on Coinbase.
It’s important to note that this analysis excludes liquid staking tokens or those with prior trading history on other platforms, as their price reactions to Coinbase listings are less distinct.
In a notable case, DIMO, a lesser-known cryptocurrency used for compensating drivers for data sharing, outperformed BONK’s pre-listing surge. Following Coinbase’s listing announcement on April 17, DIMO’s value more than doubled within just two hours.
This trend indicates that announcements of new listings on Coinbase are generally linked to an increase in the prices of those cryptocurrencies. However, this correlation does not necessarily extend to the period following the actual listings.
Over Half of Coinbase’s New Listings Decline in Their First Week
While it’s still too early to conclusively assess BONK’s performance at the end of its first week on Coinbase, having been on the platform for just four days, its initial trajectory has been noteworthy. BONK’s value surged by 128% in the first 14 hours post-listing, setting a record for the year and surpassing the increases of other cryptocurrencies like DIMO and VeThor from VeChain.
However, the initial surge in prices following Coinbase listings tends to wane over time. In fact, about half of the cryptocurrencies listed have experienced a decline in their value in the months following their debut, with many dropping by over 50%.
In contrast, some assets like celestia (TIA) and the telecommunications-focused token helium (HNT) have seen dramatic increases, with gains up to 400% since their introduction on Coinbase. Notably, HNT was added in July and TIA in early November, during periods when the crypto market was particularly buoyant. This suggests that the impact of Coinbase listings can vary significantly depending on the overall market conditions, especially in bear markets.
Raghav Sawhney
Raghav is a significant contributer who uses his knowledge, skills and experience towards development & growth of the organisation in an efficient and effective manner.
