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Memecoins conitnue to shape the conversation around crypto adoption
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Memecoins have been a part of the cryptoasset ecosystem virtually ever since the asset class achieved mass market awareness and appeal during 2017-2018. While most memecoin projects have been revealed, time and again, as grifts, pump-and-dump schemes, or otherwise unethically motivated ventures, the appeal of these projects continues to be obvious. For investors seeking to dabble into the crypto world in a casual way, or for investors looking to capitalize on a short-term spike in popularity, memecoins continue to offer an alluring path to (allegedly) easy profits. Of course, memecoins cannot be fully discussed without mentioning Dogecoin, one of the earliest to market – and most popular – memecoins that has been mentioned and supported by business tycoon Elon Musk.
Recently the discourse around memecoins, and dragging the rest of the crypto landscape along as well, has turned decidedly political, as Democratic lawmakers have responded to several announcements by the Trump administration related to projects affiliated with the President’s family. Two specific items that have thrust memecoins into the spotlight, and might potentially derail the GENIUS Act, include the following. First, an announcement on the Trump memecoin website inviting top investors to an intimate private dinner with VIP White House Access ruffled feathers. Secondly, the potential $2 billion investment by an Emirati state-backed venture into World Liberty Financial led to accusations of commingling transforming into legislative action.
Setting politics aside, which in the current political environment is increasingly difficult, there are several lessons that the crypto market can learn from the controversy swirling around the memecoin marketplace.
Memecoins Are Speculation
The fact remains that the vast majority of memecoins are speculative investments versus legitimate investment vehicles, and this needs to be understood by the wider marketplace as cryptoassets continue to make inroads across the board. Specifically, $500 million was lost memecoin scams and rug pulls in 2024, with notable celebrities being impersonated leading to notable losses that included French football star Kylian Mbappe and music artist Wiz Khalifa. This also ties into another point that investors and policymakers alike need to increase efforts around; reducing the amount of fraud and social engineering attacks via social media. According to research by Merkle Science approximately 75% of memecoin related scams and rug pulls took place on X, and 19% took place on YouTube. Given the influence of social media in the crypto community, ensuring that only quality information is circulated with increase in importance moving forward.
Regardless of which celebrity or politician is involved, or which political affiliation those individuals happen to have the real impact of this memecoin crackdown should be that a greater number of investors realize that memecoins are not investment opportunities, but speculation.
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