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The Mona Lisa Phenomenon

The Mona Lisa Phenomenon


The unlikely state of a crypto market rife with memecoins and animals shouldn’t make the Web3 space less inviting for people to explore.

The scene is set and the picture is painted

You arrive at the Louvre with the essentials: a water bottle, a camera, your best walking shoes, and some petty cash to get in the door. But this isn’t any line at the Louvre, it’s the one wrapping around the hall to get into the room that houses the Mona Lisa.

The Louvre houses some of humanity’s greatest artistic treasures. You can step proudly by Liberty Leading the People and contemplate the follies of man before Oath of the Horatii. However, you must squeak past the crowds to see the masterpiece that has come to define the Louvre as the house of the Mona Lisa.

You might have also caught a glimpse of him pondering the connection between the people flocking to the Mona Lisa and the degen traders flooding Ethereum to trade memecoins as something of a Mona Lisa phenomenon.

“There’s like a cult following to it. There are people who might not even know what it is but they think I have to see it. In crypto trading it’s the same. We’re walking around looking at all these beautiful projects, but people clog up the space to see one thing.”

To where the liquidity is

We spoke with Joe after his trip to get his thoughts about the current state of the market, iconic works of art, EthCC, and the importance of reliable and accurate data in maintaining his project’s two crypto-based indexes.

Cryptex Finance is a DeFi protocol that maintains the TCAP Index and the JPEGz Index.

He said that on his visit to the Louvre, he saw “some of the most beautiful things [he’s] ever seen in [his] life that had no wait time and no line,” but that he “waited an hour to see a small painting that thousands of people were lined up to see…”

His observation drew an immediate parallel to the contemporary crypto markets which are mesmerized by obscure, esoteric memecoins, and hinted that it could be a misstep for us to idolize one work of art or pump one type of crypto asset.

The strangest thing Joe noted is that at first, these new tokens come up and make people wonder whether they’re sustainable or whether they’ll last, but everyone crowds around to see them. This fact, however, makes many of them sustainable, “which is the weird paradox of the business.”

At the time of our meeting, the top trending tokens that weren’t stablecoins or native tokens on Ethereum, Arbitrum, and Optimism, where Cryptex is deployed, were memecoins and animal racing tokens. The vast majority of the trade counts and volumes for those tokens were on Ethereum.

top tokens on Ethereum
The top tokens on Ethereum from late July.

Outside of his Cryptex Founders Fund, he says he only holds $ETH and doesn’t trade memecoins. Although he does not partake in the more controversial type of trading that can be found on-chain, he was steadfast that “people should have the right to do whatever they want to do.”

He explained that in addition to having the right to, people ultimately will do whatever they want.

Within the context of the crypto markets, this isn’t necessarily because people are irrational or random, even if Ethereum is becoming a sort of house of the memecoins. Joe feels that “People are going to flock to where the liquidity is,” which creates a double-edged sword, so to speak, in the markets.


As volatility increases among tokens in a basket on one network, as is the case with memecoins on Ethereum, and people flood the network to trade, gas prices rise, increasing the net cost to execute a trade. The idiosyncrasy of fluctuating gas prices was exposed long before memecoins proliferated. Cryptokitties, one of the earliest NFT games, accounted for a reported 13% of all gas spent on Ethereum in late 2017. This caused Ethereum gas fees to spike into the hundreds of dollars while investors and gamers rushed in to see that new, shiny thing.

Joe called the rise of gas fees due to memecoin trading a “net negative” that is not healthy for the ecosystem that “gives the devs more stuff to work on.”

A divining rod for the masses

Memecoins are essentially digital assets made often on the fly by slapdash developers that reflect a prevalent meme in pop culture. When Elon Musk changed Twitter to X, a litany of X-themed tokens flooded the market. When animal racing became “the thing” in late July, a handful of animal racing-themed tokens circled the market.

top Ethereum tokens
The top Ethereum tokens on Network Pulse.

There are even memecoins of memecoins. Some of the most popular are Shiba Inu $SHIB , which was launched in 2020 specifically as a shoutout to Dogecoin. More recently, $PEPEX and $PEPEXL were launched as memecoins of the $PEPE token that integrate the trending X-token theme.

Readers will notice that all of these trends are most prevalent on Ethereum by a wide margin. While there are memecoins on all the networks Blockpour tracks, they mostly reach the top of trending token lists on Ethereum, which Blockpour tweeted about .

memecoins on Blockpour
Viewing all the memecoins on Blockpour's Top Movers tool.

Through July, Blockpour covered the ebbs and flows of the memecoin markets at length across various networks including the aforementioned ones and Algorand, BNB Chain, and the remaining 4 networks on the platform.

The top liquidity pool
The top liquidity pool on Ethereum.

The $USDC / $WETH liquidity pool remains the top pool across all networks by daily volume in USD, but token volumes were undoubtedly dominated by trending memecoins like $BITCOIN (the memecoin, not the one from Satoshi), $HAMS, and $PEPE.

Insulated from capricious phenomena

Joe says that Cryptex’s main offerings, the TCAP and JPEGz Indexes are operating as expected, and that the memecoin craze doesn’t register enough on a crypto macro scale to have a significant impact on TCAP, despite the net negative effect that memecoins may have on a network.

TCAP tracks the total market cap of the crypto markets. Everything from Bitcoin and the flash-in-the-pan memecoins to the lowest stablecoins are included in the calculation for the total crypto market cap. The JPEGz Index tracks the blue chip NFT market.

“Even with memecoins blasting off, they often only hit maybe $40-50 million market cap, which is going to be a drop in the hat compared to the $1.2 trillion crypto market cap.”

The facts back his claim. $PEPE has the highest on-chain market cap of any trending recent memecoins with $504.6M. However, the on-chain market caps of $HAMS only his $2.1M by the time this piece was published. Readers can assume that those numbers were over 10 times higher during their peaks, which still puts them in the range Joe stated.

The facts back his claim. $PEPE has the highest on-chain market cap of any trending recent memecoins with $504.6M. However, the on-chain market caps of $HAMS only his $2.1M by the time this piece was published. Readers can assume that those numbers were over 10 times higher during their peaks, which still puts them in the range Joe stated.

When asked, Joe said that DeFi indexes are generally equally useful for traders and businesses who want first-time exposure to the Web3 investing space. Both indexes offer investors an opportunity to gain round-the-clock exposure to the crypto market and the NFT market without needing to hold baskets of tokens themselves.

TCAP idnex chart
The TCAP index chart.

DeFi indexes can also be used as a hedging tool for short and long strategies - holding a $TCAP position to hedge a short play will protect against some losses, and conversely result in some gains in a long position as opposed to hedging with stablecoins.

These indexes are powered by data feeds from Chainlink, which Blockpour also uses for some particular use cases. Joe praised the Chainlink infrastructure as an essential part of his platform’s operations, and added that what they’re building “is powering everything in DeFi. Shoutout to Chainlink.”

He explained that the latency on the data TCAP receives has been reduced to a near-negligible 0.5% level, which is vastly lower than the 3.5% latency that his team experienced 4 years ago when it began building the indexes. Lower latency means data can be collected and processed faster. The faster it can be processed, the more precisely the index can track market caps.

Blockpour also boasts extremely low latency of just a few miliseconds thanks in large part to our node infrastructure. We run a node on each of the networks we track, giving us data directly from the source rather than from unreliable 3rd parties.

Chainlink’s oracles offer an “outlier protection” that prevents suddenly-launched tokens that may be spoofed to be priced at trillions of dollars in market cap from affecting the TCAP index.

Exciting chains

Where will the next heap of liquidity flow to that attracts the masses of traders? Nobody has a crystal ball, although some have an iris-scanning orb, so the future is uncertain. However, Joe has a few ideas for what chains are most exciting now and will be for the time to come.

Ethereum was the first chain that Cryptex was deployed on, which “holds a soft spot” in Joe’s mind. Cryptex’s V2 platform deployed on Arbitrum, the most active L2 in the market now, which Joe said “felt like home once we got there,” which is high praise for a network. But he said he was excited about zkRollups in general.

Finally, he said he liked what Canto was building, and that it warms his heart to see the Polygon partnerships, like recent ones made with Starbucks and Adidas.

As it stands, there are already droves of people exploring the beautiful projects that each of these chains offer and choosing their favorites, forming opinions about the styles they like and the builders they may not like. In time, we may look back at some projects built on each of these chains as masterpieces and have enough space for everyone around the world to enjoy them.

About Blockpour

Blockpour is a technology firm specializing in Web3 data and analytics, offering individuals and businesses indispensable data and tools to navigate the dynamic on-chain universe while bridging seamlessly to the off-chain world.

Through our real-time and historical multi-chain data feeds, businesses and traders can fully unlock the power of blockchain data to inform their strategies, optimize operational efficiency, and drive top-line growth.

To learn more about Blockpour check out our website and follow us on Twitter or LinkedIn. For sales or inquiries about the API, contact [email protected].


The above article is for informational purposes only and is not financial advice. Blockpour is a data aggregation and analytics platform only and does not provide financial advice or services of any kind.