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Are memecoins a passing trend or a new frontier in crypto?

Two schools of thought vie for attention in the token space

Joanna BuenconsejoProfile
By Joanna BuenconsejoOct. 28th - 2pm
4 min read
GOAT memecoin graphic

Blockchain has introduced a variety of digital assets, but few are as quirky or attention-grabbing as memecoins.

Often based on internet jokes, these tokens have surged in popularity, with viral sensations like Goateus Maximum (“GOAT”) reaching market caps in the hundreds of millions almost overnight.

To some, memecoins represent the lighter, community-driven side of crypto, making the world of digital assets feel fun and accessible to newcomers.

Yet while many see them as an amusing way to join the crypto space, others argue they are risky assets, lacking the value and stability of coins like Bitcoin or Ethereum. Critics contend that memecoins are easy targets for price manipulation, with values driven largely by social media hype.

Fans, however, see them as a true reflection of the crypto movement—one that thrives on community, culture, and a bit of humor. Are memecoins a passing trend or a new frontier in crypto?

One memecoin case that has been rocking the crypto space lately is Goateus Maximum “GOAT” memecoin—which reached a market capitalization of $800 million within a fortnight of its launch. 

Its story began with the AI bot Truth Terminal, which actively shared posts about the meme religion “Goatse Gospel” on X. The bot itself made headlines pre-GOAT thanks to a $50,000 gift it received from venture capitalist Marc Andreessen. 

Following the token's launch on October 10, its value skyrocketed, largely fueled by the bot's active promotion and viral reach. 

In less than a week, the token went up by more than 800%. Though its market cap has been fluctuating, it sits at $700 million on Coinmarketcap at the time of writing. 

Unlike established coins Bitcoin and Ethereum, GOAT is a memecoin by nature—it was created and endorsed as a joke. These types of tokens inherently lack the necessary fundamentals for them to be considered solid investments. 

According to Anndy Lian, who authored the book NFT: From Zero to Hero, memecoins are tokens that are mostly community-driven. He told Techopedia, “Since they do not have any fundamental economic or business use  case, their prices are usually influenced by social media and online sentiment. This often brings a lot of hype but also FOMO and financial risk.” 

With this, it’s no wonder that some investors may find them absurd. In fact, Bybit’s Head of Derivatives, Hao Yang, told Cointelegraph, “The success of memecoins can be seen, like punk rock, as a symptom of disillusioned young investors who have seen the opportunities afforded to their parents disappear.” 

Yang also explained that “by printing tokens out of thin air and pumping them to billion-dollar valuations, these creators are showing the absurdity of our current fiat system.” 

Since memecoins such as GOAT are community-driven assets without inherent value, their prices are largely determined by sentiment and internet trends. These make these memecoins extremely volatile assets that are vulnerable to market manipulation tactics like pump-and-dump schemes, which involve artificial price inflations followed by market crashes, per Bankrate. 

While the community-driven and trend-influenced nature of memecoins allows for substantial gains, it also makes them risky investments. Moreover, the absence of genuine value and utility is not a problem unique to memecoins, as it can be found in other digital assets as well.

In fact, analyst Murad Mahmudov, the CIO of Adaptive Capital Management, thinks that this is what the cryptocurrency landscape is all about. He touched on the subject during his talk in the TOKEN49 global conference. 

During his talk, Mahmudov criticized major venture capitalists, crypto projects, and influencers, asserting that they operate as a collective scam, promoting narratives for projects that lack genuine economic value.

He also quoted an X user who claimed, “Nearly all of the tech in crypto is a smoke screen designed to sell you a token that does nothing.”

Mahmudov theorized that “Altcoins aren’t primarily about tech and memecoins aren’t primarily about memes ... both are simply tokenized communities using different narratives and techniques to recruit people and get the price to go up."

Claiming the token itself is the product. And so, memecoins could be better options compared to other tokens.

Mahmudov believes in the “memecoin supercycle” theory, which claims that a mix of factors—such as hype in social media and interest of the community—will lead to an endless supercycle for meme-focused cryptos. 

As memecoins like GOAT continue to make headlines, they raise broader questions about the evolution of digital assets. Whether they’re merely fleeting tokens built on social buzz or an enduring part of blockchain culture, memecoins have undeniably tapped into a sense of community and spontaneity that resonates with many in the crypto space.
 
While their volatility and lack of inherent value make them a high-risk investment, they also highlight how rapidly crypto’s landscape can shift based on sentiment and social trends. For now, memecoins remain a powerful, if unpredictable, force in shaping crypto’s next moves.
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