Crypto winter is a time during which assets hibernate, stagnate, and face losses. Solana investors do not seem to share this belief, given that a new meme altcoin has seen growth of over 1500% in less than a week. BONK took the community by surprise, and now has the title of Solana’s very own Dogecoin.
The Solana ecosystem has had a rough year. Facing network instability and lack of interest, the ecosystem’s native SOL token fell from $200 in January to $13 in December. To add insult to injury, FTX’s collapse has severely impacted Solana’s future prospects. But out of these ashes rises a new meme coin that united the community – Bonk.
Today’s article discusses the meme phenomenon that is BONK. You’ll learn everything you need to know about the project, from the initial airdrop to the token’s current price action. I will also share some insight into the altcoin’s future potential.
What Is Bonk Inu (BONK)?
BONK is a cryptocurrency created in reaction to the VC-infested swamp that’s corrupted Solana for too long. Most altcoins on Solana have an uneven distribution that favors angel investors and presale participants. The developers behind BONK created their project in order to break the wheel and introduce a community-owned altcoin.
Developers have launched BONK on December 29th, airdropping 50% of the token supply to four groups of Solana users:
Much like Dogecoin, BONK is a dog-themed altcoin oriented around a vibrant community. Solana is a blockchain that has been built from the ground up by its users – most of which use it due to its ridiculously low gas fees. But many within the community were financially damaged by VCs and malicious actors – like those from FTX – who manipulated the market.
“BONK strives to become the true community coin of Solana to be used far and wide across the many great dApps of this flourishing ecosystem. BONK will not sit in the hands of VCs, instead, it will be held by those that form the social layer of this formidable network.”
BONK arrived at Solana’s lowest point. But surprisingly enough, the meme altcoin helped animate the community and push investors to buy back in again. In fact, SOL has almost doubled in value since SOL’s launch. And BONK itself grew over 1500% in a short time.
As stated in the project’s whitepaper, BONK is an altcoin that will be used by those that form the social layer of Solana. This group of people includes traders, collectors, artists, developers, and other key players. BONK also intends to be the primary coin on Solana, and has plans for introducing various forms of utility.
BONK Tokenomics Explained
BONK launched mere days before new year’s eve. The token arrived on December 29th and was airdropped to investors, artists, collectors, and developers. Half of the token supply (50 trillion coins) was airdropped. The creators airdropped BONK using tools from the Famous Fox Federation – a popular NFT collection.
BONK has a max token supply of 100 trillion tokens. 50 trillion tokens were airdropped to the community. The airdrop distribution took place in the following fashion:
The remaining half of the supply was mainly distributed to early contributors who helped facilitate the project’s launch. This group of people involves 22 individuals who have “provided early support in the form of artwork, token design, marketing, integrations, web development, business development, and provision of early liquidity.
These users have not only helped launch BONK but actively participate in the project’s development. Their access to tokens is limited by a 3-year linear token vesting period starting from January 1st 2023.
An additional 15% is distributed to BonkDAO. This decentralized organization is envisioned to help the community gain further control over various initiatives, token distribution, token management, and other aspects of the project.
Another 5% of the token supply was allocated to the token’s initial liquidity. The liquidity went to decentralized exchanges such as Radium, Orca, and Solend. It also includes other platforms such as FFFlip, Monaco Protocol, and BOIBOOK.
The remaining 5% was allocated towards various marketing promotions, advertisements, and other types of promotions that help boost BONK’s visibility in crypto.
The team had originally envisioned allocating another 5% of the token supply to themselves. But due to various issues and concerns, the anonymous team decided to burn the allocation.
Is Bonk Inu (BONK) a Good Investment?
BONK follows the basic formula of most dog-themed coins: large supply and high community interest. The combination allows the cryptocurrency to perform well and gain huge traction – mostly due to an investor’s ability to buy large numbers of tokens at a low price. Among other things, this is a huge reason behind the tokens’ large growth since its inception.
BONK is aimed to be a community coin. The project’s developers have hinted at BONK gaining an important utility and role in the Solana ecosystem in the future. So apart from being a meme, BONK might also have a function. Having some sense of fundamental value would greatly aid the token’s performance.
As of now, most of BONK’s value is mostly speculative. The token has no notable function or utility that makes it stand out from other projects. The only thing keeping it popular in the first place is the narrative surrounding BONK – being Solana’s dogecoin. But is this enough?
BONK might be a good investment given enough time. The team behind BONK would need to introduce numerous functionalities for it to play a crucial role in Solana. Due to its huge supply, BONK might perform well by having the role of a currency for NFT collectors, investors, artists, developers, etc.
But for now, BONK’s investment thesis is dubious. No one questions the project’s narrative. However, I implore you to ask yourself: is this project more than a narrative? The project is still fresh and requires some form of legitimacy, reputation, and merit for it to warrant further growth. Unless it pulls a Dogecoin, don’t think about pouring your life savings into BONK.
Of course, I recommend doing your own research. The cryptocurrency sector is highly volatile and unpredictable. The best advice I have is to invest only what you can afford to lose.
Does BONK Have a Future?
BONK has the goal of reviving Solana by rewarding the community which has built it, rather than VC investors who have destroyed it. 50 trillion tokens were airdropped to investors in late December, and within the first couple of weeks, BONK grew more than 1500%. The airdrop had a value, for some, of over $10,000 at ATHs for some investors.
BONK started out as a good idea. After all, why not reward those who stayed on an ecosystem that almost went extinct? However, the problem arrives at BONK’s sustainability and potential to actually become an important part of Solana. Such a move requires serious steps – something that can’t be fueled by memes alone.
The project can follow the steps of Dogecoin and become a hallmark project by focusing on the community first. The team would have to introduce utility to the project in order to warrant its further growth. Only then can you deem BONK to have a future.
Solana has already had a vibrant airdrop culture. Most projects that were airdrop, notably COPE, have long been forgotten. Unless BONK wants to join the pile, it will need to innovate more than any other predecessor.
To learn more about Solana, I suggest reading the following articles:
Marko is a crypto enthusiast who has been involved in the blockchain industry since 2018. When not charting, tweeting on CT, or researching Solana NFTs, he likes to read about psychology, InfoSec, and geopolitics.