DEGEN is a meme coin turned utility token related to the social media platform Farcaster. The token was launched in January 2024 on the Ethereum layer-2 network Base via an airdrop to the Degen channel community on Warpcast.
Early stages
The project was established by Jacek Trociński, a former architect and data engineer at Hedgehog Technologies.
In an interview with Blockworks, the founder discussed how, after observing the success of other points-based tokens in attracting interest to the Degen channel, he decided to develop a similar token.
The initial idea for the token was to enable Warpcast users(Casters) to tip each other with $DEGEN tokens, promoting engagement and, thus, high-quality content. The mechanism was simple—users could earn points by being active in the Degen channel on Warpcast. Points were granted to users who received likes and comments on their posts or if they held specific NFTs. 1 point represented 1 $DEGEN token in the subsequent Airdrops.
Since then, the utility of the token has rapidly expanded, most notably serving as a mechanism to incentivize builders and content creators through grant programs.
Degen chain
After the project quickly gained traction, the team set out to build their own Layer-3 chain, called the Degen chain. It was built by Syndicate and utilizes Base as the settlement layer, as well as AnyTrust for data availability.
Degen Chain is a cost-effective Layer-3 solution designed specifically for the quickly growing Degen community and aims to provide significantly lower transaction costs compared to Layer-2 solutions like Base, Arbitrum, Optimism, and others.
With $DEGEN as the chain's native gas token, the community can unleash innovative applications and explore new use cases while benefiting from near-zero transaction fees.
Users who wish to participate in the Degen economy can use the official bridge to transfer assets from the most popular Ethereum Layer-2 chains.
Tokenomics
Upon launch, approximately 37 billion tokens were created, with 70% designated for the community. This allocation underscores DEGEN's community-centric nature, ensuring that the project's success is shared by all.
Another 15% has been set aside to establish a liquidity pool, and the remaining 15% will support the team, investors, and the broader ecosystem. An inflation rate of 1% is scheduled to commence in 2028.
After the introduction of their own chain, the $DEGEN token was migrated from Base L2 to the Degen chain (L3). Apart from various Decentralized Exchanges, the token is also available for trading on centralized exchanges like ByBit, Kucoin, and Gate. All relevant information regarding the chain can be viewed through their explorer.
Ecosystem and Partners
Although light-hearted in nature, the project has managed to attract a variety of high-quality partners. These partners include infrastructure providers such as Syndicate, Arbitrum Orbit, Conduit, Decent, and Airstack, as well as crypto-native apps like Drakula, Perl, and Zora, all of whom have embraced $DEGEN for various use cases.
There is already a growing number of applications built on top of the Degen chain. Noteworthy projects include:
- DegenSwap enables token swapping and staking.
- AlfaFrens offers private alpha chats for everyone. Subscribe and stake subscriptions to your favorite influencers using $DEGEN.
- NFTdegen.lol is the first NFT launchpad on the Degen Chain. The project features an integrated NFT pool, enabling users to sell NFTs to the pool at any time.
- FrogSwap lets users stake, farm, and exchange tokens. Additionally, the FrogSwap Launchpad allows users to purchase newly issued Degen Chain tokens.
Memecoin supercycle
The entirety of 2024 in the crypto world can be defined with a single phrase: the memecoin supercycle, a phenomenon in which our beloved cat and dog coins with no supposed utility significantly outperform all other Crypto assets.
Even though memecoins are not a novel concept, their reemergence and strength are evident, so much so that VC firms and even blockchain foundations are jumping on the hype train.
Whether a memecoin is successful or not mostly depends on how strong the community of holders is. The Degen project leans heavily into this and aims to create a community-centric ecosystem. Because the token was generously distributed to the community, making it the sole beneficiary of any activity that happens on the Degen chain, the community members are directly incentivized to create fun and useful tools and apps that the community itself can use.
