Meteora introduced M3M3 – pronounced “meme” – a new project aimed at changing the way meme coins work by introducing staking incentives to investors. Some analysts, however, are concerned about its operating mechanism.
The platform facilitated the launch of the M3M3 token to serve as a test case for this concept, with the token quickly gaining traction within the crypto community.
Understanding the M3M3 platform
M3M3 is Meteora’s attempt to address the challenges of the meme coin market, where the majority of tokens fail to maintain long-term value.
Data confirmed the grim state of meme coins, as out of 1.2 million new tokens launched last month on pump.fun, only 1.4% migrated to decentralized exchanges and just 0.05% exceeded a market capitalization of a million dollars. This is largely due to the high rate of rug pulls.
Earlier in the year, a crypto.news report confirmed that Solana-based meme coin deployers facilitated rugpulls, resulting in a combined $26 million loss for investors in March. Most recently, the Hawk Tuah token crashed 90% within hours of launch amid allegations of a rug pull.
Meteors look address solve these problems by promoting a player versus platform (PPP) model for meme coins. This would represent a change from a player versus player (PvP) environment, where rapid liquidity withdrawals often leave holders in a loss-making situation.
The new PPP model will introduce a staking approach, according to the announcement. This staking mechanism essentially encourages token holders to stake their assets, thereby reducing selling pressure and promoting long-term stability.
How the M3M3 Staking Model Works
The M3M3 system encourages staking by presentation rewards derived from locked-in liquidity swap fees. These fees are distributed among the best bettors in the form of Solana (GROUND), which can be claimed immediately, and even coin rewards which are automatically reinvested.
The model potentially creates a positive feedback loop: as more participants participate, competition intensifies, leading to token purchases and improving liquidity, which in turn generates more rewards.
Deactivation is subject to conditions, as participants must wait a set period of time before withdrawing tokens. This mechanism discourages short-term speculation and promotes sustainable participation.
A saturated market
Meanwhile, M3M3 is entering a crowded market of token deployment platforms, including Pump.fun, SunPump, and Snek.fun. PancakeSwap also recently spear Springboard on the BNB channel.
Each competitor has carved out a niche for itself by making it easier to launch meme coins and generate liquidity. For example, Pump.fun focuses on hype-driven token launches, while SunPump levers buyback and chain burning mechanisms. Meanwhile, Springboard allows free token launching.
However, M3M3’s introduction of staking rewards could set it apart by addressing the issue of value retention. In comparison, M3M3 leverages a staking mechanism inspired by the “(3,3)” model to create a sustainable ecosystem.
Possible strengths and disadvantages
The M3M3 model has several advantages. First, it incentivizes token holders to stake rather than sell, thereby reducing market volatility.
Second, it would provide a steady stream of income through fee rewards even during market downturns, as the official website claims. Additionally, its configurability makes it attractive to launchpads looking for staking solutions for new projects.
However, the platform is not without its challenges. Its reliance on staking to support demand may falter if rewards become insufficient to attract participants. The potential for high entry barriers, to the extent that only major players benefit significantly, could alienate smaller investors.
Launch of the M3M3 token
Meteora launched the M3M3 token as a test for the platform. Within hours of its release, the token soared over 962,000%, now boasting a market cap of $116 million per market. data.
Its rapid success prompted a major cryptocurrency exchange, MEXC, to list the token shortly after its debut.
Meteora distributed M3M3 tokens via airdrop to active users of its platform. Despite its success, the launch sparked debate, with critics alleging internal control and expressing concerns about a lack of transparency.
Community reactions
The launch of the M3M3 was met with mixed reactions, with opinions ranging from praise to harsh criticism.
DeFi project CC2 Ventures highlighted the generosity of Meteora’s airdrop strategy, which rewarded active users with M3M3 tokens. They noted that the tokens had significant value, thanks to the token’s market cap rapidly increasing to over $113 million.
Lemon, another expert on X, praised the staking model, comparing it to revolutionary DeFi innovations of the past. Lemon highlighted the platform’s ability to allow token holders to earn rewards without having to sell their assets, describing it as a new frontier for meme coins.
However, not everyone viewed the launch favorably. One commenter expressed disappointment that the launch did not use the launch pad established by Jupiter Exchange, which could have ensured greater transparency.
These critics argue that Meteora’s decision to stealthily launch the token undermined trust and gave an unfair advantage to a select few.
Meanwhile, some skeptics have dismissed the project altogether, suggesting it was far-fetched and risky. One observer cited the unexpected, “insider-driven” nature of the launch, warning investors to avoid risking their SOL tokens on what they saw as an uncertain proposition.