What is BONK? Solana Meme Coin Reviewed

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BONK is the first meme coin in the Solana ecosystem, launched to alleviate the impact of the FTX collapse on Solana. It's integrated into various dApps and facilitates interaction with other assets on the blockchain.
The development of BONK began in mid-2022, with its token release following six months later in December. To understand BONK's value, it's important to consider the context of its introduction.

In November 2022, the centralized exchange FTX and Alameda Research declared bankruptcy, both of which had connections to Solana. Fearing that Solana might face a similar fate due to its association with FTX, users started to withdraw their funds from the blockchain in large numbers. As a result, Solana's Total Value Locked (TVL) decreased from $1 billion to $300 million over a month. 
Solana’s TVL from November 2022 to December 2023. Source: defillama.com

Solana’s TVL from November 2022 to December 2023. Source: defillama.com

BONK played a key role in softening this blow by drawing in liquidity. Just a few days after the token launch, the network saw the creation of more than 20,000 new wallets.

How BONK Operates

BONK, created on the Solana blockchain, adopts the SPL (Solana Program Library) standard, similar to Ethereum's ERC standard. It ensures high transaction throughput, low delay, and minimal fees. One of BONK's distinctive features is token burning.

Token burning refers to moving assets to an address from which withdrawals are impossible. This method reduces the token supply in the market, which can positively impact their value. This strategy is also used by other projects like Bitcoin Cash and Stellar.

The sole token-burning event for BONK occurred on January 5, 2023, when the team eliminated 5% of the total token supply, equating to 5 trillion BONK tokens.

The Team Behind BONK

BONK is a community-driven token, "created by people for people," and is marketed as an independent asset aimed at uniting users. It's no surprise that the project team remains anonymous.

Nevertheless, they actively manage the meme coin's social media, including:

  • X (previously Twitter): They post announcements, critical updates, and integrations with other projects.
  • Discord: They engage with the community, respond to queries, and provide a platform for discussion.

In a CoinDesk interview, a developer of BONK, known as KW, revealed that 22 people are working on the project. This team is independent of Solana Labs and the Solana Foundation and comprises crypto enthusiasts who have previously developed NFTs, dApps, and other decentralized solutions.

The creators don't consider other dog-themed meme coins like DOGE or SHIB as competitors, highlighting BONK's distinctiveness from the myriad of similar projects. 
It's already more useful than either of those. There’s (not) much you can do with SHIB or DOGE on-chain,
KW remarked.
BONK boasts over 114 integrations across 10 blockchain networks, covering various areas such as DEXs, gaming, NFTs, etc. However, the majority of these integrations are primarily for facilitating BONK trading.

BONK Integrations in 2023

By December 2023, BONK had soared by 1400% compared to its launch price. This remarkable increase is attributed to heightened user interest and numerous integrations, such as:

  • Listing on major cryptocurrency exchanges like Gate.io, ByBit, and KuCoin, with a listing on Coinbase on December 14.
  • Integration with dApps including Orca, Raydium, Jito, and Injective, where BONK is used for payment, staking, and derivatives trading.
  • Partnership with Bandit Aggregator to create NFTs using BONK. This allows users to publish new collections and mint NFTs across eight blockchain networks. 
  • The DeFi protocol Wormhole for BONK exchanges between various blockchains, including all EVM-compatible networks, as well as Algorand, Near Protocol, and others.
  • Compatibility with crypto wallets Backpack, Kepler, Martian, and Solflare for secure BONK storage and exchange.

Beyond these integrations, the BONK team has developed proprietary solutions like OpenBONK, Buy Bonk, BONKbot, and BONK or BUST. Let's examine each more closely.

OpenBONK. A Solana blockchain-based trading platform specifically for BONK, supporting SOL, USDC, and BONK. Unlike typical decentralized exchanges with Automated Market Maker (AMM) algorithms, OpenBONK uses an order book.

Buy Bonk. A cross-chain application for trading BONK with other assets across multiple blockchains. It supports five networks, including Solana, Ethereum, BSC, Avalanche, and Arbitrum.

BONKbot. A Telegram bot for trading tokens within the Solana ecosystem, built on Jupiter aggregator to ensure transaction availability and security. Users can purchase new tokens by entering their ticker or address.

BONK or BUST. A betting platform focused on the SOL-USD price movement, supporting bets using BONK and USDC. It provides two options: bet on price increase (BONK) or decrease (BUST).

BONK Tokenomics

BONK Distribution. Source: capital.com

BONK Distribution. Source: capital.com

BONK is used as a means for payments, rewards, and governance. The maximum supply of the asset is set at 100 trillion BONK, with 50% being distributed via an airdrop in December 2022, around Christmas.

The recipients of BONK tokens were members of the Solana community, specifically:

  • Solana-based NFT projects. 21% of the tokens were allocated to 40 projects representing more than 296,000 individual NFTs. The distribution was balanced among collections of different market capitalizations to avoid centralization risk.
  • Market participants and DeFi users on Solana. Those who engaged with DeFi on Solana, exchanging and adding tokens to liquidity pools, received 15% of the total BONK supply.
  • Artists and collectors on Solana. Creators and NFT traders were allocated 10.5% of all BONK tokens.
  • Solana developers. Crypto enthusiasts involved in deploying dApps, writing smart contracts, and creating other solutions on Solana were awarded 5.3% of the tokens.

While allocating 50% of the total token supply to the community may seem significant, it is quite standard when compared to the major airdrops of 2023. For instance, Arbitrum allocated 56% of ARB tokens, and Aptos distributed 51%.

The remaining BONK tokens were distributed as follows:

  • The project team, consisting of 22 individuals who worked on the design, integrations, marketing, and other project components was allocated 21% of the total BONK supply. These tokens are to be distributed evenly over three years starting from January 1, 2023.
  • BonkDAO, with 15.8% of the tokens directed to establish and support the BonkDAO platform for decentralized project management.
  • Initial liquidity, where 5.3% of all tokens were designated to support BONK trading on platforms like Raydium, Orca, and Solend. Profits from this allocation are intended for BonkDAO.
  • Marketing, with 5.3% of all BONK tokens set aside to promote the project and attract new users.

As of December 2023, the total supply of BONK stands at 93 trillion, with 60 trillion circulating. The remaining portion of the tokens is locked and will gradually become available over the next two years.

Future Development of BONK

In 2024, the project team plans to broaden BONK's integrations and develop new dApps. For example, they aim to launch GameFi applications like Bonk Poker, Bonk Roulette, and Bonk Slots, using BONK as the in-game currency and reward system.

Moreover, the developers have plans for SocialFi. They are looking to launch a Web3 social network that ensures privacy, security, and fair compensation for content creators. 

The project maintains its original development direction, aiming to create an entertaining platform within the Solana ecosystem to attract new users and retain existing ones. However, whether BONK can sustain this momentum in the long term remains uncertain.

Vlad Vovk
Writes about DeFi and cryptocurrencies from a technological perspective.