MonaCoin is a relic from the early days of cryptocurrency, when spending 10,000 BTC on two pizzas seemed like a reasonable investment. As with a lot of early alt-coins, MonaCoin was little more than a clone coin with a cute character slapped on it. Suddenly, this cute character has made MonaCoin attractive enough to jump 3000% in value.
Since its launch in December 2013, MonaCoin has spent most of its existence with a sub-$1 million market cap. Today, MonaCoin’s market cap is closing in on $1 billion.
As with most minor alt-coins, there have been spikes before. One noteworthy bump came in August 2014. At a time when Bitcoin’s involvement with the Silk Road and other darkweb sites was generating negative headlines, a Japanese news show did a positive piece on this minor alt-coin. MonaCoin leapt from $0.10 to $0.84 almost overnight. But the bump was short-lived and the drop-off came immediately. A few months later, MonaCoin was back at $0.10 with a sub-$500,000 market cap.
The current spike is different in both magnitude and duration. To put this in perspective, IOTA’s sudden rise to $3.80 has made it the most hyped coin since Ethereum. At the beginning of November, IOTA was trading at $0.33, meaning its value has increased by around 1151%. MonaCoin has produced more than double IOTA’s return on investment.
There are two main reasons for the sudden rise of MonaCoin. While other novelty coins such as DogeCoin are more or less dead, cat-referencing cat is in vogue right now. CryptoKitties has surprised many by becoming the first big viral success on the Ethereum platform. The most sought-after kitties on this cat-breeding game are being sold for thousands of dollars’ worth of Ethereum. CryptoKitties is so popular that congestion from the game is seriously slowing down the Ethereum network. In this climate, backing a coin on the basis of its cuteness doesn’t seem quite so ridiculous.
The second reason is the most important one. In its home country of Japan, MonaCoin has gone mainstream.
MonaCoin is a Litecoin clone that was based on a cat meme that frequently appeared on the Japanese 2chan message board. It’s actually faster than Litecoin, another factor which has helped its sudden mass-adoption.
Japan is embracing cryptocurrency in a big way. Many stores are accepting payment in cryptocurrency and Zaif has set up a network of crypto ATMs across the country. The two coins chosen for inclusion in both most stores’ payment options and Zaif’s ATMs are Bitcoin and MonaCoin.
MonaCoin’s utility value as a currency wouldn’t be enough to make it stand out if it in a completely free market, but its status in Japan has granted it an enormous captive market of consumers who are enthusiastic about cryptocurrency. MonaCoin may not be a ground-breaking piece of technical wizardry like IOTA, but it doesn’t have to be. With the Japanese market cornered, MonaCoin just has to be more useful than Bitcoin for making payments.
MonaCoin’s market cap has been rising all year. It began 2017 with a market cap of little more than $1 million. MonaCoin’s market cap hit $11 million in May, $20 million in June, and $40 million in July. The wildest growth has come in the last few months, with the market cap hitting $80 million in mid-October and surpassing $250 million just two days later.
At a time when cutting-edge coins like IOTA are surging in value, MonaCoin is proof that technical advancement isn’t the only determiner of a coin’s success. It’s sudden surge to an almost $1 billion market cap is a perfect storm of corporate partnership, branding, and speculation.