Where meme coins come from
Where the category came from
Dogecoin started it in December 2013 as a parody of the tokens launching weekly at the time. It was not built to become anything, and it accidentally demonstrated that a coin with no purpose could persist for over a decade and process real payments.
Every meme coin since has been an attempt to repeat that, and almost none have.
How they get launched
The barrier is close to zero, and understanding this explains the volume.
Issuing a token on an existing network is a smart contract deployment costing cents on a cheap chain. No permission, no audit, no minimum. Somebody creates the token, puts a portion into a liquidity pool so it can be traded, and promotes it.
That is the whole process. It explains why tens of thousands exist and why the count keeps rising, as the entry on how many cryptocurrencies exist discusses.
How they end
The honest assessment
Most go to zero, and the mechanism is worth naming rather than moralising about.
A token with no revenue produces returns only from later buyers paying more than earlier ones. Early holders, including whoever created it, sell into the demand they generated. When new buyers stop arriving, the price falls to what it reflects, which is nothing.
This is not a claim that everybody involved is defrauded. Plenty of participants understand exactly what they are doing and treat it as gambling with clear eyes. It is a claim that the structure has no other outcome available.
Rug pulls
The deliberate version, and there are two common mechanics.
Liquidity removal
The creator holds the pool tokens and withdraws the trading liquidity, at which point the token cannot be sold at any price. Holders are left with balances and no exit.
An open mint function
The contract permits the creator to issue unlimited new tokens. They do, sell them, and every existing holding is diluted to nothing.
Both are checkable in advance
Both are visible in the contract before you buy, which is the only reason checking is worth anything.
What to check
Four things, and none of them make a meme coin a good idea.
The contract itself, readable through a block explorer, specifically whether minting is open and whether transfers can be frozen. Whether the liquidity is locked and for how long. How concentrated holdings are, since a few addresses holding most of the supply can end the price at will. And whether the token exists on the chain you think it does, because name and ticker are trivial to copy.
Relevance to a merchant
Close to none, and the sensible policy is short.
A payment gateway supports assets with liquidity, because it has to convert what it receives. A token nobody will buy cannot be converted, so it cannot be settled, so it is not offered.
If a customer proposes paying in one, the answer is to ask for a stablecoin or one of the established coins on a supported network. Accepting an illiquid token means holding something you cannot sell, which is a worse position than declining the sale. The setup guide covers which assets are worth enabling.