"Crypto Chaos: Memecoins and NFTs Throw Curveballs in Market Predictions, Bringing Uncertainty to the Brave New World of Cryptocurrency"

The emergence of memecoins and NFTs has caused uncertainty in the cryptocurrency market, with their liquidity ebbs and flows affecting the Web3 scene, and while new opportunities are emerging, their unpredictability makes them hard to predict.

In the world of cryptocurrency, uncertainty is a constant. New trends, patterns, and emerging digital assets continually throw curveballs into the flow, making it hard for even the most seasoned traders to predict what's next. This is especially true in the NFT (non-fungible token) market, where a new memecoin craze is raising Ethereum transaction fees while also bringing in new liquidity for NFTs.

Before NFTs came on the scene, fiat currency flowed primarily through Bitcoin and other large caps before trickling down to mid caps and finally to low caps or "shitcoins." However, the emergence of NFTs as a digital asset class that fits somewhere in this cycle has changed things.

NFTs, especially PFPs (profile picture NFTs), are a hybrid of an identity solution, a club, and a fungible token. There are different sizes by market cap, with Bored Ape Yacht Club (BAYC) and Azuki being the large cap of the NFT market, Mfer’s, Nakamigo’s, and Milady’s being the mid caps, and the rest making up the small caps.

Adding to this mix are memecoins, which do not profess to have any utility other than social media posting and having fun. Memecoins, like $DOGE, $SHIBA, and $PEPE, which reached a $150m market cap in several days, have become a digital asset that is fun and memes.

The Milady Maker PFP community is rumored to be behind the emergence of $PEPE memecoin. Memecoins came back in after the Nakamigos and BAYC communities stagnated and had some large holders leave the community. This, combined with the boredom of retail crypto folks, brought about memecoin season.

When large caps run, they rise fast, sucking all the liquidity from mid-lower caps. When they stop running, the capital flows back to mid-low caps. This pattern can happen across all classes and categories, which is causing the Web3 scene to seem very chaotic.

These liquidity ebbs and flows are causing uncertainty in the NFT and memecoin markets. The Forkast 500 NFT Index is down over 2% over the past seven days, reflecting a sharp decline in the NFT market. A new memecoin called $PEPE has been trading at volume, causing high transaction fees on Ethereum. NFT volume, on the other hand, has suffered as traders practice patience, with many waiting for fees to normalize.