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Das Degen: Vol 2 - The Nickel

The Case for $0.05 DEGEN & Beyond

Written by @itsbasil with support from @yekim.eth

Follow @yekim.eth's DEGEN Newsletter here.


We published "The Case for $0.01 DEGEN" about a month and a half ago. At that time, the prevailing DEGEN narrative was simply, "DEGEN is the biggest memecoin on Base". Since then, there's been a significant shift. Base has emerged as a major narrative force, capturing Twitter’s attention, resulting in wallets and users bridging to the chain en masse. Over that time, DEGEN's holder base expanded by over 371%, and its price surged by 300%. In this paper, we will explore the reasons behind these developments, examine the improvements in integration, the changes in narrative, and exposure, and discuss what the future holds for our beloved DEGEN token.

Current Price: $0.017

Price Target: $0.05 

Circulating Supply: 12.5 Billion

Total Supply: 36.9 Billion

Holders: 47,300

Vol 1 - The Penny 

Created: February 6, 2024 (+49 Days)

Price At Time of Publication: $0.00426 (+299%)

Holders At Time of Publication: 10,040 (+371%)

Price & Relative Analysis

The Nickel

  • Gain Needed*: +194%

  • Market Cap: $624M

  • FDV: $1.8B

  • Peers: 1inch, Rocket Pool, Livepeer

  • Coin Ranking: ~155

The Dime

  • Gain Needed*: +488%

  • Market Cap: $1.2B

  • FDV: $3.7B

  • Peers: Helium, ApeCoin, Tezos

  • Coin Ranking: ~96

The Quarter

  • Gain Needed*: +1,371%

  • Market Cap: $3.1B

  • FDV: $9.2B

  • Peers: Fantom, Maker, Injective

  • Coin Ranking: ~44

The Half-Dollar 

  • Gain Needed*: +2,841%

  • Market Cap: $6.2B

  • FDV: $18.5B

  • Peers: Aptos, ICP, Litecoin

  • Coin Ranking: ~25

The Dollar

  • Gain Needed*: +5,782%

  • Market Cap: $12.4B

  • FDV: $37B

  • Peers: Chainlink, Polkadot, Polygon, Uniswap

  • Coin Ranking: ~14

    *at Current Supply

Network Effects


When "The Case for $0.01 DEGEN" was published on February 6th, Farcaster was experiencing a breakthrough. Daily Active Users (DAUs) were hitting record highs almost daily. On its biggest days, the protocol welcomed over 60,000 new users, achieving a growth rate of over 1000% week-over-week at times.

As of today, this explosive growth has stabilized to around 20,000 unique casts per day, with the growth rate largely leveling off, possibly in anticipation of the next significant surge. Despite this, protocol revenue has continued to climb, reaching new peaks of over $800,000. This indicates sustained growth in channel and warp revenue, providing the Farcaster team, a team that ships like crazy, with increased capital for further marketing efforts and development.

Farcaster DAU As of Last Publication 
Farcaster DAU As of Today 
Farcaster Revenue

The Exchange & The Chain


Coinbase is a U.S.-listed public company and the world’s most trusted centralized exchange. It remains one of the few survivors in its space, boasting significant influence in Washington, D.C., and garnishes a $50 billion market capitalization. As of our last report, Coinbase had a market capitalization of $25 billion, marking a remarkable doubling in size over the past 45 days.

Coinbase’s exchange supports over $90 billion worth of assets, and their management and listing team is no newcomer when it comes to meme coins. Further, with continued fee compression and the need to fight with DEXs for volume, Coinbase seems eager to list new tokens.

In June 2021, Coinbase added support for $DOGE. Only two months later would they add support for $SHIB.


Introduced in August of last year, Base is Coinbase’s Ethereum Layer 2 Chain built on the Optimism Stack. It’s largely the home of all Farcaster tokens, including DEGEN.

Base has issued a call for builders, offering Grants and venture funding to developers migrating to the chain. They’ve hosted endless Frame hackathons and are leading the charge in attracting new teams.

Notably, Base enables seamless integration with Coinbase products and tools. This means that 110 million verified users from across the globe now have easy fiat onramps onto Base and, subsequently, into the DEGEN ecosystem. Base has also made USDC transfers completely free for users and has noted publicly that they intend to keep transfers free indefinitely, significantly increasing stablecoin integration and usability.

Further, Base was one of the first L2s to implement EIP-4844, often referred to as the Blobs Update. This reduced transaction fees by 10-100x, taking the chain one step closer to a fully sharded future, which will, in turn, reduce fees by yet another 10-100x.

While Base continues to remain the new kid on the block and is forced to compete with much larger and already established L2s, they’ve made very impressive inroads since the beginning of the year.

At the time of the last publication, Base was bridging roughly 600E per day across 650 users. Today somewhere around 3500E is being bridged each day across more than 3,000 users.

On a daily basis, Base is now bridging roughly the same amount of ETH as Arbitrum and much more than Optimism.

The Total Value bridged to Base is now nearing $1B.

There are now about 5.1 million users on Base, compared to 3.3 million at the time of the last publication and 2.2 million users six months ago. That’s a 67% gain in 45 days and 162% over the last 120.

Weekly active users and transactions have spiked on the chain. 

There are now 1.4 million active weekly users on Base, compared to less than 400k active users 45 days ago. Over that same time period, weekly transactions have grown to over 7.3 million, compared to around 2.3 million at the time of the last publication.

The Total Value Locked on Base is now $850 million, compared to less than $400 million 45 days ago. This is still a far cry from Arbitrum’s $3.2 billion locked, indicating plenty of room for growth.

The Story of DEGEN (So Far): A So-Called Memecoin

First, let me preface this by saying that the original airdrop to 1.6k users who participated in the /degen channel was a whopping 10M tokens. At the time, that was worth less than 1E. Today, those 10M tokens are worth more than $100,000. We can talk about right place, right time, but it’s so much more than that. What started as a so-called “memecoin” has quickly become a financial and social ecosystem play for the fastest-growing EVM L2, but how did this happen?

DEGEN has been a trailblazer from the outset, continuously innovating and pushing the boundaries of what's possible. Within just a month of launching the DEGEN contract, Farcaster users found themselves able to tip each other directly within the app. This functionality was enabled by simply commenting on others' posts, pioneering a new tipping standard for tokens on both Base and Farcaster, a model that may become a global norm for new tokens. As other cryptocurrencies began to adopt similar mechanisms and new technologies emerged to facilitate seamless tipping across various tokens, DEGEN had already gained significant momentum. Providing a master class in token distribution, DEGEN's holder base expanded rapidly, growing from 1,600 to 10,000, then doubling to 20,000, and now exceeding 40,000 holders in an impressively short period. This remarkable growth occurred on a chain that many had underestimated. Yet, DEGEN has continued to prove that it has far more to offer, maintaining its position at the forefront of innovation and utility.

Immediately after its deployment, and just a month into its journey, DEGEN further deepened its integration with Farcaster. Jacek, the founder and lead developer behind DEGEN, swiftly launched a Frame Bounty. At that time, Frames were a fresh innovation, enhancing the OpenGraph standard by transforming static embeds into dynamic, interactive experiences. Essentially, Frames enabled users to transform their casts into native interactive applications within any Farcaster client, marking a significant leap towards a more engaging and versatile user experience on the platform.

Jacek earmarked 2.5 million DEGEN for the initiative, allocating 1.5 million to the winner and 500,000 each to two runners-up. With backing from Jesse Pollack, recognized as Base contributor #001, innovative new Frame use cases began to emerge almost instantly. This support catalyzed the community's creativity, leading to the rapid development and implementation of novel applications for Frames, significantly enriching the Farcaster ecosystem.

First out of the gate was @fish, who developed a Frame that enabled users to verify their daily tipping allowance. Following this, @jkrantz.eth introduced a Blackjack Frame, offering players the opportunity to earn DEGEN by playing cards. Shortly afterward, @nicnode and his team launched Lotto PGF, a Frame that allowed users to buy lottery tickets with the potential to win daily prizes amounting to several million DEGEN. The stage was set for continued interactivity and gamification.

To further simplify the development process, @jacek subsequently released DEGEN API tools, significantly lowering the barrier to creating DEGEN-enabled Frames and spurring innovation within the community.

In the realm of e-commerce, @lluis, a Haberdasher, launched, a marketplace dedicated to DEGEN merchandise. This platform was later incorporated into a Frame, enabling users to shop directly within their Farcaster Feed and make purchases entirely with DEGEN, enhancing the utility of the DEGEN token in another vertical.

In a delightful Valentine's Day surprise on February 14th, @jacek declared that all Farcaster users with a top hat emoji in their name would receive 1 million DEGEN tokens to use for tipping. At the announcement, this allocation had a value of almost $3,000. The value of these tokens has since risen, with 1 million tokens now worth about $10,000. In total, 1.3 billion tokens were distributed to 6,500 users—valued at over $4 million, or roughly $600 per person at the time—truly embodying the spirit of generosity, spreading the love, and increasing the holder base by a few multiples nearly overnight.

As Frames continued to revolutionize the Farcaster platform, new Frames by @karanruparel.eth facilitated further DEGEN-based gambling and gaming activities. Additionally, prominent crypto-wallets like Rainbow announced their integration with DEGEN, including Rainbow Point multipliers for DEGEN swaps, broadening DEGEN's reach and usability.

Simultaneously, some of the most influential Social DAOs, such as Boys Club, Friends With Benefits, and Forefront, began featuring DEGEN in their communications, signaling growing recognition and adoption within wider communities.

The Frames Bounty initiative persisted in yielding innovative, DEGEN-native Frame applications. @conley introduced a Rock, Paper, Scissors elimination tournament featuring a 500k DEGEN prize pool, while @karanruparel, @abhishkekumar, and @pratyushrungta developed a range of casino-style and card games, showcasing the diverse potential for DEGEN's gamification.

Vocdoni, an open-source, decentralized, and censorship-resistant voting protocol, initiated its own giveaway, offering 750,000 DEGEN to users who created in-frame polls. This move was later embraced by the Haberdasher DAO, under the leadership of @purp and @wake, who utilized this technology for conducting fully in-frame DAO proposals and voting. This innovation significantly boosted DAO voting participation and established a new benchmark for DAO engagement on Farcaster.

As DEGEN's utility within the Farcaster ecosystem expanded, the perception of DEGEN as merely a "memecoin" began to shift. It increasingly became a crucial tool for Frame developers to attract new users, demonstrating DEGEN's growing significance and versatility.

The potential of DEGEN was further unlocked when @jesse issued a call to action for the development of a DEGEN-native Farcaster client, a sentiment that was quickly echoed by prominent accounts like @li and @coopertrooper.eth. This request marked a pivotal moment, highlighting the community's ambition to deeply integrate DEGEN into the Farcaster experience, and perhaps create something much, much bigger than originally thought.

The ecosystem continued to flourish with the introduction of more Frames, such as the Old Castle Defense, an on-chain game developed by @tocd that offers a genuine player-versus-player experience. Victors in this game were rewarded with DEGEN, adding an engaging and competitive layer to the platform's activities.

Development within the ecosystem didn't stop at Frames; it evolved to include widgets as well. @iamng took up the challenge and developed a widget that could be accessed directly from a phone's home screen, enabling users to quickly check their tipping allowance and points. Following this, @iamng released a Frame that allowed users to view these amounts in USD terms, further enhancing user experience and accessibility beyond any Farcaster client.

In the midst of these advancements, @jacek made another significant announcement on February 19th: a nearly 500E crowdfunding initiative led by 1Confirmation, with contributions from dozens of Farcaster OGs. Valued at $1.275 million at the time, this crowdfunding effort represented a substantial vote of confidence in DEGEN—a token still perceived as a "memecoin" with a sub-$100M market cap and operating on one of the smaller L2 networks. This move underscored the community and investors' belief in the token's potential and the underlying chain, despite the inherent risks and challenges associated with newer projects.

Around the same period, Boost, a distributed incentive network, announced its support for DEGEN, further integrating the token into the broader crypto ecosystem. Additionally, Perl, the largest social game on Farcaster, revealed plans to incorporate DEGEN into its platform, and Daylight, an on-chain recommendation engine, also announced its support for DEGEN. These developments highlighted DEGEN's increasing acceptance and integration into various projects and platforms, enhancing its utility and presence in the crypto community.

Following the success of "Crypto The Game," a Survivor-like, crypto-native game where players formed tribes and competed for daily immunity and a chance at a 40E prize, Farcaster user @nbragg proposed a similar concept within a Frame. Thus, "Hunger Games" was introduced—an in-frame game where users would deposit 50,000 DEGEN, be assigned to tribes, and compete daily to avoid being voted out. This innovative game concept further exemplified the creative and engaging ways DEGEN and Frames were being utilized to foster community interaction and engagement on the Farcaster platform.

Despite the whirlwind of new features and developments, relatively little time had elapsed. The DEGEN Frames Bounty, still in progress, was drawing to a close. @owl clinched first place with his Lotto PGF Frame, while @swabbie.eth's Choose Your Own Adventure game and @abishekkumar's DEGEN Blackjack followed closely behind.

As the Frame Bounty concluded, the crypto community's attention shifted towards the newly introduced ERC404 standard. This innovative standard merges the qualities of fungible ERC20 tokens with those of non-fungible ERC721 tokens, offering a dual-functionality token. DEGEN, pushing at the forefront, was among the first to integrate with this standard. Trash NFTs led the charge, pioneering the use of 404s and opening a TRASH/DEGEN liquidity pool, which would set a precedent for future NFT projects.

By this time—merely two months post-launch—DEGEN had been incorporated into over 50 applications via Frames, had = more than 100 bounties out for DEGEN-related projects, and was featured in upwards of 100 NFT projects, a testament to its rapid acceptance and utility expansion within the ecosystem (hat tip to @juli).

Through these developments, DEGEN began to transcend its initial classification as a mere memecoin. It became a fundamental part of the Farcaster-native social applications landscape, marking its significant contribution to the platform's ecosystem. Yet, with its burgeoning integration and growing influence, one pivotal question lingered: What about DeFI?

With the integration of DEGEN into Teller and Timeswap—both time-based loan protocols—the token began its foray into the DeFi space relatively early. Following suit, Astria, a protocol offering intent-based, fixed-rate lending, incorporated DEGEN. Then, Aerodomre, recognized as the premier trading and liquidity marketplace on Base, established DEGEN/WETH pools, signaling DEGEN's growing influence in the DeFi ecosystem, albeit within Base's still-nascent DeFi sector.

Additionally, @carlos and @moonlight took the initiative to launch a Farcaster Index, further diversifying DEGEN's utility and presence in the financial ecosystem of the platform.

Around this time, an intriguing development occurred when updates were made to the DEGEN website (, where a new banner announced, “The Degen L3 Chain is coming soon!” This teaser hinted at an ambitious expansion of DEGEN's utility and value, challenging the perception of DEGEN as merely a "memecoin" and suggesting its evolution into a more substantial, multifaceted asset.

This period also saw Based Ventures, a collectors DAO initiated by @lay2000lbs, publicly announcing their acquisition of 1.6 million DEGEN tokens from the open market. While the purchase might not have been the largest in volume, the move was significant in terms of sentiment, reflecting confidence and investment interest in DEGEN from within the community.

These developments underscore the dynamic and evolving nature of DEGEN, highlighting its transition from a niche memecoin to a key player within the DeFi space and broader cryptocurrency ecosystem, with potential implications far beyond its initial scope.

Still, more Frames would launch. With each new development, Frames continued to evolve and improve, offering more sophisticated and user-friendly functionalities. The introduction of @paybot by @robrecht marked a significant milestone, allowing users to send DEGEN directly within a Frame. Additionally, @nbragg and @greg developed Frames that facilitated the direct swapping and purchasing of DEGEN, further integrating financial transactions into the user experience.

The trend of social app integrations also continued, this time with @interface, broadening the scope of DEGEN's social utility.

During this period of rapid innovation and expansion, DEGEN attracted the attention of investors.

According to @0xpotus, a wallet containing $16.5 million in cash began accumulating DEGEN, while another investor had already established a half-million-dollar position in the token. This accumulation by "whales" highlighted growing confidence in DEGEN's value and potential.

Thanks to the efforts of @matthewfox and the @degentip team, the DEGEN-native in-frame NFT minting capability saw further enhancements. They introduced a no-code Frame builder, democratizing the creation and minting of NFTs with DEGEN by making it accessible to users without technical expertise. Subsequently, the team expanded the builder's functionality to include support for 721 and 1155 collections on Zora, significantly enriching the NFT minting and collecting experience within the DEGEN ecosystem and beyond.

These advancements not only showcased the continuous innovation within the DEGEN community but also underscored the token's evolution from a memecoin to a cornerstone of a burgeoning digital economy, with diverse applications ranging from finance to digital art to social.

The introduction of @drakula, a novel app blending elements of and TikTok, marked a significant milestone in the evolution of DEGEN's ecosystem. Developed by @alexmasmej.eth and his team, Drakula emerged as a DEGEN-native application from its inception. Achieving over 500M in DEGEN volume and attracting more than 20,000 users within just two days of launch, its success was staggering. By the third day, the volume in DEGEN surpassed $1.5 million, and by the tenth day, it had soared to over $10 million.

This unprecedented growth not only demonstrated the app's popularity but also established a new standard for applications launching on Base: integration with DEGEN could effectively attract an existing user base of 40,000 funded wallets overnight, posing the question of whether this model would become a template for all new Base applications.

Concurrently, the DEGEN token was experiencing consistent price discovery, giving users with large tip allocations a significant amount of money to hand out each day.

In the name of community, many chose to be impactful, including covering rent and student loans. Power users, such as @ciniz and @0xen, were distributing thousands of dollars daily, with their contributions only increasing over time. Additionally, @ciniz and the Onchain Gaias team demonstrated their commitment to DEGEN by purchasing an additional 5.5E worth of DEGEN on the open market.

The excitement within the DEGEN community further expanded with the introduction of new social games. @polymarket launched a March Madness Frame, where users could create and mint their brackets onchain, including a prize pool of $5,000 in DEGEN to be shared among the top 100 brackets. In a similar vein, but different, @bracketgame introduced a Frame that allowed users to invest in College Basketball teams using DEGEN, hinting at the potential intersection of sports betting and DEGEN. What does this mean for the $150 billion per year sports betting market? But, perhaps more importantly, what does this mean for a DEGEN L3?

The momentum within the DEGEN community shows no signs of slowing down, thanks to initiatives like the new DEGEN meme contest announced by @jacek, offering 200k DEGEN for the best memes. Similarly, a collaboration with Rounds.WTF promises 300k DEGEN to Farcaster users who produce quality DEGEN-related content that earns likes from top tippers. These initiatives continue to fuel engagement and creativity in the community, underscoring DEGEN's growing influence.

While the anticipation for a Coinbase listing lingers, DEGEN's journey toward mainstream exchange recognition has begun. BitMart, known for offering over 1,500 cryptocurrencies to its diverse client base, recently became the first centralized exchange (CEX) to list DEGEN. This milestone was quickly followed by listings on HTX and Poloniex, marking a significant step forward in DEGEN's adoption and visibility in the wider cryptocurrency market.

Looking into the future, the landscape is ripe with potential. The Haberdasher DAO, with its substantial treasury and abundance of ideas, continues to expand its influence. The promised Layer 3 (L3) chain is on the horizon, signaling further advancements and integration possibilities for DEGEN. With DEGEN establishing itself as a straightforward and effective way to integrate with Base across various applications—be they financial, social, or cultural—the appeal of gaining access to over 45,000 funded wallets virtually overnight is undeniable.

Moreover, as DEGEN's price climbs, the incubation of new projects accelerates, propelling a virtuous cycle of opportunity and innovation.

So, what lies ahead for DEGEN and its community? While it's clear that DEGEN is evolving beyond its origins as a memecoin, the precise trajectory remains to be seen. However, one thing is certain: the journey ahead promises to be about much more than just achieving a nominal value milestone. DEGEN's integration, adoption, and the burgeoning ecosystem it supports hint at a future filled with potential, driven by a community eager to explore and expand the boundaries of what's possible in the digital and decentralized world.

Until we conquer a Nickel, until next time.

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