Memecoins Soar and Plummet in the Wake of Trump’s Presidency

Trump’s win in the US presidential race has sparked new interest in memecoins doubling the market’s value to $118 billion. These digital tokens mix online memes with blockchain tech becoming a key part of the attention economy. They blend viral social media trends with risky investments.

Hawk Memecoin’s Collapse Highlights Risks in Viral Crypto Frenzy

The trend picked up steam when Hawk, a memecoin created by social media figure Haliey Welch hit the market. Even though it started with a value of $490 million, the coin’s worth dropped to $17 million in a matter of days. This led people to accuse Welch of taking advantage of her followers. 

Crypto expert Stephen Findeisen called the launch a “rug pull,” which means a trick to make quick money before ditching a project. Welch said these claims were not true pointing out that her team had not sold any tokens.

The widespread memecoin craze goes hand in hand with Trump’s promise to back the crypto industry. His win caused Bitcoin’s price to jump hitting $100,000 for the first time, and boosted interest in assets linked to the rebel spirit of decentralization. Big names, like tech billionaire Elon Musk, have also helped fuel the excitement. Musk’s support for Dogecoin, a coin that started as a joke, has pushed its market value to $60 billion.

Experts in crypto say it is easy to make memecoins, which is why there are so many of them. Carol Alexander, who teaches finance at the University of Sussex, explains that you can create tokens on platforms like Solana with just a few thousand bucks, reported The Guardian. This makes it possible for even beginners to give it a shot. People then push these coins hard on places like Discord, Telegram, and X (formerly Twitter), often getting influencers to help get people to buy them.

Memecoins Compared to Gambling as Unpredictable Trends Drive Frenzy

However, experts warn that memecoins do not have any real value. Alexander stresses that these tokens are just for speculation and do not have any actual use. In the same way, Merav Ozair, who is the Emerging Technologies Mastery consultancy founder, compares buying these coins to gambling. She says whether you win or lose depends on trends that nobody can predict, not on anything solid.

Despite doubts, memecoins attract small investors because they are cheap. Many tokens cost just a tiny bit of a penny drawing people who want to take big risks for big rewards. This trend looks a lot like what happened with meme stocks such as GameStop where online campaigns pushed prices sky-high.

Sam Baker, who trades memecoins, sees this area as a mix between social media’s focus on grabbing attention and blockchain’s new money systems. He knows these investments are unpredictable likening them to lottery tickets that might pay off big.

Memecoins keep making news, but their up-and-down prices and appeal to gamblers show how shaky the whole crypto market can be.