It's a memecoin when memecoins pump and it's an l3 when l3s pump and it's a base asset when Base pumps and it's socialfi/farcaster when that pumps. --@DegenMVP
In recent days, $DEGEN token (@degentokenbase) of Farcaster's ecosystem have seen a meteoric rise, breaking through the $0.019 mark with a FDV exceeding $700 million. This represents a 20-fold increase from its lowest point a month ago, and it has successively made its debut on major CEXs like HTX and Bitget. The narrative can hardly keep up with its repeated record highs. π
The "Blue-Chip" Meme
Media coverage generally labels it as a Meme coin. If regarded as such, $DEGEN has successfully captured the hot money flowing from Solana's meme token frenzy to the Base chain, becoming the leading Meme token of the Base chain. This status owes much to its early community-building efforts within the Farcaster ecosystem.
The substantial wealth effect from the $DEGEN airdrop was one of the catalysts for Farcaster's explosive popularity at the beginning of the year. For a considerable time, the correlation coefficient between the number of casts on Farcaster and the price of $DEGEN remained above 0.9.
In its first airdrop phase, casting $DEGEN in the /degen channel earned you airdrop points, while also empowering early Farcaster NFTs with special token-related score boosts. This included OG NFT airdropped to active badge holders upon Farcaster's open registration, Farcats NFTs by popular artist 0xen, and NFTs from Farcaster's ecosystem Hacker News news.kiwistand.com. Thus, many early Farcaster users naturally became promoters of $DEGEN.
$DEGEN's rise from the /degen channel to widespread popularity across Farcaster suits its meme nature, aided by its catchy name and iconic π© logo, which spurred a wealth of derivative creations. Channels, Frames, NFTs, and tokens built around $DEGEN have significantly bolstered its meme influence.
A Medium for the Creator Economy
The second airdrop of $DEGEN adopts the model of "accumulating a daily allowance to tip others," thereby becoming an essential component in motivating the creator economy. When you come across a great cast, you can tip in the comments below, and the cumulative amount of tips will determine the quantity of the second airdrop. The amount you can tip is linked to your activity points, which are related to the number of likes, comments, and shares you receive. Hence, the more interactions you receive, the more you can tip others; the more popular your casts are, the more tips you will receive. At least, that was the initial idea the team had, aiming to encourage more high-quality active users and content.
Of course, this model naturally doesn't avoid airdrop farming, but the team has been continuously striving to prevent this tipping from turning into an airdrop farming game. This mode of issuing community tokens for tipping has also been emulated by other projects within the Farcaster ecosystem and the Bonsai in the Lens ecosystem. The practice of tipping, indicated by a "number+letter/emoji," is frequently seen in the comments section of Farcaster casts, forming a spontaneously organized tipping culture within the community.
The currency within Farcaster Ecosystem
The short video app drakula.app (AKA Web3 TikTok) was the first to showcase the value of $DEGEN as a circulating currency within the ecosystem, similar to Friend Tech's use of $ETH for trading Keys, Drakula adopted $DEGEN for trading video blogger tokens. An increasing number of Farcaster ecosystem applications are now using $DEGEN as their internal currency, such as the sports team club Bracket.game and the prediction platform Perl.xyz, as well as third-party clients like degencast.xyz and Supercast.xyz, which have developed convenient reward features for $DEGEN. We may see more Farcaster ecosystem applications adopting $DEGEN, expanding its use cases and popularity.
Moreover, Drakula set a precedent for how a new app can rapidly grow within Farcaster. The open framework and composability of Farcaster provide the necessary on-chain social graph for applications to quickly acquire customers, while $DEGEN serves as the native circulating currency, providing asset liquidity for app startups. Using $DEGEN as the internal currency can achieve mutual success for $DEGEN and the application.
Farcaster + App Legos + $DEGEN economics = Onchain Social Summer.
Degen L3
The $DEGEN team has secured angel funding of 490.5 ETH from 1confirmation and Farcaster community OGs, aimed at developing the Degen ecosystem and community. They also announced an exclusive L3 for $DEGEN, promising EVM compatibility and reduced transaction fees, with further details awaited.
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Finally, today the $DEGEN team announced a shift in liquidity rewards from Uniswap to the Base chain's native DEX aerodromefi.finance , facilitating interaction between the community token born from Farcaster and the native DeFi blue chips of the Base chain. It is foreseeable that $DEGEN will continue to play a crucial role not just within the Farcaster ecosystem but also within the Base chain ecosystem, becoming an integral piece of the Coinbase ecosystem puzzle.
