Hello readers,

In politics, the strength of a candidate often comes down to the loyalty of their “base.” In sports, the franchises with the most loyal, generational “base” of support tend to be the most valuable. In religion, the “base” converts new followers to spread the message.

We see the same principles in consumer product companies and media brands.

Tesla has a “base.”

Apple has a “base.”

Barstool Sports has a “base.”

Fox News has a “base.” And so does CNN.

The loyal “base” never leaves. These are the people who “identify” themselves with the politician. The sports franchise. The Religion. The product. The message.

Their loyalty equates to:

1. Organic, free marketing (the most potent form)

2. Product evangelism

3. Sense of community amongst its participants

4. Access to capital

5. Collective belief

Through this lens, we apply the same framework to memecoin communities.

Which memecoins have the strongest “base,” and what can that tell us about the value of that community?

This week, we aim to answer that question using onchain data.

Disclaimer: Views expressed are the author’s personal views and should not be relied upon as investment advice.

Let’s go.

Tokenholder Cohorts

Avg. & Median Holdings per Wallet

Here we can see that SPX6900 stands out as an outlier in terms of the median and average wallet balance. The median wallet balance on Ethereum has four times the value of any of the other “blue chip” memecoins.

You might be wondering why the median balance is so low for WIF, BONK, and Based Brett. The answer is airdrops/dusted wallets.

Holders > $1k

In terms of the % of holders with > $1k, SPX6900 stands out here as well — nearly 2x that of MOG.

Holders > $10k

4.52% of all wallets holding SPX6900 on Ethereum and Solana have > $10k today — nearly twice the % of the number two coin.

Holders > $100k

Just under 1% of all wallets holding SPX6900 on Ethereum and Solana have over $100k of the token.

For reference, there are 167k BTC wallets with > $1m (.8%).

ETH has 18,276 wallets with > $1m (.015%). It has 141k wallets with > $100k (.1%).

% of Holders < $100

SPX is leading in terms of its % of larger, high-conviction token holders. So, it’s not surprising that it also leads in terms of having a smaller % of wallets holding less than $100.

Tokenholder Retention

We believe our retention data provides the most potent signal as it pertains to a memecoin’s “base.”

Whale Retention > 50%

Again. SPX6900 has the lead here.

Pengu (Pudy Penguins). BONK, and GIGA round out the top 4.

BONK and GIGA have very low median and average holder balances. But they show up at the top of the leaderboard here. We place more emphasis on the Whale Retention data.

Whale Retention > 75%

30% of SPX6900 wallets on Ethereum that ever hit $100k of holdings still have over 75% of their peak holdings in units.

This is interesting.

Some people view investing in memecoins as “burning money.”

But here we have almost 1/3 of SPX holders putting serious capital into the asset and holding on through 10-20x gains and 80% drawdowns.

That’s some profound conviction.

Minnow Retention > 50%

We see the same level of conviction amongst all SPX6900 holder cohorts.

Minnow Retention > 75%

Again. Roughly 1/3 of SPX6900 holders who ever had $10k of the token still hold greater than 75% of their peak holdings in units.

Conviction. Delusion? Call it whatever you want. The data doesn’t lie, and it’s signaling something.

DEX Flows

30-day Net Flows: Wallets > $1k

In addition to analyzing wallet cohort holdings and retention rates, we look at Net Flows to/from DEXs across cohorts to get a sense for who is buying/selling across different communities at various inflection points.

Net Inflows = selling activity.

Net Outflows = buying activity.

Here we have the first category that SPX6900 is not leading in.

*Please note that the more mature memes (Pepe, Shiba, Bonk) trade on most centralized exchanges in addition to the DEX data we have here.

Remember, inflows = coins sent to DEXs (selling).

30-day Net Flows: Wallets > $100k

30-day Change in Price

Not surprisingly, the tokens with the highest level of DEX inflows tend to be the ones with the weakest price action over the last 30 days.

Fair Value

MVRV

The MVRV measures the “realized price,” a proxy for the cost basis of all tokens circulating vs the market price.

SPX6900 trading at an MVRV of 1.63 indicates that, on average, SPX6900 holders are sitting on 63% unrealized gains (Pengu holders are up 102%, on average).

The average holder for the rest of the coins is sitting on unrealized losses right now (MVRV is below 1).

No wonder sentiment is poor.

Momentum & Price Action

RSI

When the RSI approaches 30, or dips below it, it’s telling us the token is “oversold.”

Historically, allocating a small amount to certain projects at these inflection points has produced outsized returns over a 3-6 month timeframe.

The key is that you need to be confident that the bull market structure is intact.

Price from All-Time High

Closing Thoughts

The price action ties it all together. The memecoins with the strongest tokenholder cohort data and retention data have performed the best in the market.

In our opinion, the “base” is the reason for this.

You either have one, or you don’t.

We believe the tokens with the strongest “bases” are as follows:

1. SPX6900

2. PENGU

3. BONK

4. PEPE

5. MOG

6. GIGA

SPX6900 is particularly interesting to us.

Why?

It truly stands out in the data. But why? Why was SPX6900 able to “meme conviction” in ways that other communities have not?

We think it’s a combination of the following:

1. A “main character” that has skin in the game + is trusted by the community (Murad).

2. Broad “addressable interest.” SPX6900 is trying to “flip the stock market.” You may think that is silly. But it’s appealing to younger generations (globally) who are struggling to get ahead in life. They feel left out. The SPX6900 meme strikes a deep emotional chord, bonding its community.

3. Community ethos. “Flip the stock market.” Stop trading and believe in something.” “Aeons.” “There is no chart. I love you.” “DCA every day.” Again, you may think this is all silly, but these slogans mean something to the community. They signal to others that you’re “one of us” while providing a sense of “belonging.”

4. Delusional belief + absurd price targets. When you look back at the early days of Bitcoin, SPX6900 has some similarities. Mainly, a small but growing subset of people on the internet with delusional beliefs, a big idea, and a strong community.

5. Survived several large drawdowns. SPX6900 is extremely volatile. It’s made several 10x moves before selling off 50-80%. This is rotating the “tourists” in and out. But the loyal “base” hasn’t gone anywhere.

6. A network of independent people willing to work on the project for free. “Cult labor,” they call it.

If you’re interested in learning about how we pair our core assets with small allocations to our favorite memes at various inflection points, you can sign up for TDR Pro here.

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And Stay Curious.

Disclaimer: Individuals have unique circumstances, goals, and risk tolerances, so you should consult a certified investment professional and/or do your own diligence before making investment decisions. The author is not an investment advisor and may hold positions in the assets covered. Certified professionals can provide individualized investment advice tailored to your unique situation. This research report is for general educational purposes only, is not individualized, and as such should not be construed as investment advice. The content contained in the report is derived from both publicly available information as well as proprietary data sources. All information presented and sources are believed to be reliable as of the date first published. Any opinions expressed in the report are based on the information cited herein as of the date of the publication. Although The DeFi Report and the author believe the information presented is substantially accurate in all material respects and does not omit to state material facts necessary to make the statements herein not misleading, all information and materials in the report are provided on an “as is” and “as available” basis, without warranty or condition of any kind either expressed or implied.