Who would have thought that a memecoin originating on Farcaster could generate profits of up to 6,000,000%? This remarkable event occurred with DEGEN, a token initially used to reward users on Web3’s social media platform, Warpcast. Rapidly evolving from a simple memecoin, DEGEN became the driving force behind various innovative projects and dApps through the Degen Chain. In this article, we’ll delve into the details of what Degen Chain is, the history of the DEGEN token, and its potential in the crypto market.
Article Summary
- 🥉 Degen Chain is a Layer 3 blockchain within the Ethereum ecosystem, created specifically for the DEGEN memecoin community.
- 🪙 The DEGEN token started as a tip and reward token on Warpcast, a Web3 social media platform. Due to high community interest, Degen Chain was launched in March 2024.
- 🤝 Degen Chain integrates three core components—Arbitrum Orbit, Base, and AnyTrust—to deliver an efficient, fast, and secure solution.
- 🤑 DEGEN first traded in January 2024 at $0.0000008 and soared to $0.048 by March 2024, resulting in an approximate 6,000,000% gain.
What is a Degen Chain?
Degen Chain is a Layer 3 blockchain within the Ethereum ecosystem, specifically designed for the DEGEN memecoin community. It functions as an application layer chain, or app chain, so it can be customized to meet the community’s needs in developing dApps.
Degen Chain is best known as the platform that introduced its community token, DEGEN, to pay for gas fees, replacing the use of ETH. This is because this blockchain utilizes the Arbitrum Orbit infrastructure to build custom L2 and L3.
According to BSC News, DEGEN first traded in January 2024 at $0.0000008. By early February, this token began a steady rise, and by March, it had surged to nearly $0.048, achieving an extraordinary gain of approximately 6,000,000%.
Read also: Memecoin Strategies: How to Choose and When to Buy.
History of Degen Chain
The DEGEN token was launched in January 2024 by Jacek Trocinski as a tip and reward token for Warpcast subscribers on Farcaster, a decentralized social media platform akin to Twitter on the Base network.
Farcaster serves as a community hub for crypto industry fans, developers, and content creators, with Warpcast being one of its popular dApps.
Farcaster gained popularity in December 2023 when a token based on points was created. Inspired by this, Trocinski introduced the DEGEN token with tokenomics similar to Blur (BLUR) and Uniswap (UNI) tokens.
The objective was to incentivize user activity within the ‘channel’ by awarding points, which could be converted to DEGEN tokens. 1 point is worth 1 DEGEN. Users earned points through likes, comments, and holding specific NFTs. The tokens were distributed monthly via airdrops.
Due to high community interest, many developers began building dApps using DEGEN as the native token. This development spurred the creation of the Degen Chain, which officially launched in March 2024.
How Degen Chain Works
As a Layer 3 blockchain, Degen Chain integrates three essential components to offer a more efficient, faster, and secure solution. Here’s a breakdown of these components:
- Arbitrum Orbit: This core technology stack ensures smooth operations within the Degen ecosystem.
- Base: Acting as the settlement layer, Base enables secure and efficient transactions, maintaining network integrity.
- AnyTrust: This component supports data availability (DA) in this chain, ensuring platform transparency and reliability.
When a user makes a transaction on Degen Chain, it is processed on Arbitrum using Optimistic Rollups. The proof of transaction validity is then sent to Base for verification and further processing. Base finalizes the transaction and updates the blockchain status of Degen Chain. Meanwhile, AnyTrust allows dApps on Degen Chain to access data from other blockchains.
Curious about Layer 3? Read more in “What is Layer 3 Crypto?”
Advantages of Degen Chain
- Active Community: Degen Chain has an active and growing community that can offer valuable information, technical support, and opportunities to interact with other users interested in blockchain technology.
- Low Transaction Fees: Utilizing Arbitrum Orbit, a Layer 2 solution, Degen Chain significantly reduces transaction fees compared to the Ethereum mainnet.
- Fast Transactions: Arbitrum Orbit’s Optimistic Rollups enable faster transaction processing on the Degen Chain compared to the Ethereum mainnet.
- Guaranteed Security: Although transactions are processed on Layer 2, Degen Chain maintains security through the Ethereum mainnet’s robust security infrastructure.
- Interoperability: AnyTrust, a cross-chain bridge integrated with Degen Chain, allows easy transfer of assets between Degen Chain and other blockchains.
- Access to DeFi and GameFi: The combination of Arbitrum Orbit, Base, and AnyTrust creates an environment conducive to innovative dApp development, supporting various DeFi, NFT, and GameFi platforms.
DEGEN Potential in the Crypto Market
DEGEN is an ERC-20 token with significant potential, driven by its utility, robust technology, and an active community within the Degen Chain ecosystem. This token serves as the primary currency and is used for paying gas fees within this ecosystem.
Degen Chain, designed as an app chain, facilitates the creation of various dApps by its community. Currently, notable dApps within the Degen Chain ecosystem include Poidh, NFTDegen.lol, FrogSwap, and DegenSwap.
Additionally, DEGEN provides liquidity mining opportunities on platforms like Uniswap V3 and Aerodrome. By participating as a liquidity provider, users can earn substantial rewards, with the APR for the DEGEN/WETH pool in the Concentrated Liquidity category reaching an impressive 2,347%.
Since its inception in January, the Degen network has processed over 88 million transactions and boasts more than 18 million DEGEN holders.
DEGEN Tokenomics
DEGEN’s tokenomics are crafted to drive participation and growth within the Degen Chain ecosystem. Increased interaction with the platform results in earning more DEGEN, aligning holder benefits with the platform’s adoption and value. This mechanism is similar to Blur, a well-known NFT marketplace.
Learn more about Blur in our article “Blur NFT Marketplace: A Promising New Platform for Professional NFT Traders”.
At launch, 37 billion DEGEN tokens were minted. Of these, 70% were allocated to the community, 15% to the liquidity pool, and 15% to those supporting Degen Chain, including investors.
As shown in the image above, 70% of DEGEN tokens are designated for the community. Specifically, 60% of the tokens are distributed through three airdrop phases, while the remaining 10% are distributed via liquidity mining.
Conclusion
Degen Chain is a Layer 3 blockchain within the Ethereum ecosystem, specifically designed for the DEGEN memecoin community. As an application layer chain, this chain offers optimal customization for developing dApps tailored to community needs.
Originating from a channel on Farcaster, the Degen project has made significant moves. The launch of Degen Chain and the DEGEN token supports a wide range of innovative applications and projects in the crypto world.
Despite being a relatively new blockchain, the Degen ecosystem already boasts over 30 dApps. This promising progress positions DEGEN as more than just a memecoin, highlighting its potential for broader use and adoption.
Buy DEGEN Token on the Pintu App
On Pintu, you can buy DEGEN and other memecoins such as BRETT, COQ, BOME, and FLOKI without worrying about fraud. In addition, all crypto assets on Pintu have passed a rigorous assessment process and prioritize the principle of prudence.
The Pintu application facilitates transactions by being compatible with various popular digital wallets, such as Metamask. Download the Pintu app on the Play Store and App Store! Your safety is guaranteed because Pintu is regulated and supervised by Bappebti and Kominfo.
In addition to making transactions on the Pintu app, you can learn more about crypto through various Pintu Academy articles that are updated weekly! All Pintu Academy articles are created for educational and knowledge purposes, not as financial advice.
References
- Bessie Liu, What is DEGEN chain? The L3 built for the memecoin community DEGEN, Blockworks, accessed 12 June 2024.
- Sankrit K, Degen Chain and DEGEN Overview: The Community-Driven Layer 3, CoinGecko, accessed 12 June 2024.
- BSC News, What is Degen Chain? BSC News, accessed 12 June 2024.
- Ali Assef, The Rise of DEGEN, Warpcast, and Farcaster: The Next Big Thing? Medium, accessed 13 June 2024.