Memecoins are making millionaires, but are they actually good for crypto?

Memecoins are making a comeback as the cryptocurrency market experiences another bull run. Some find this exciting, while others view it as a sign of market exuberance.

Many headlines are filled with exciting tales of traders making small investments in a token that later skyrockets into a multimillion-dollar windfall. However, for every successful trader, there is another unfortunate soul who lost significant amounts of money by putting too much faith in the wrong cryptocurrency.

There’s a wide range of views when it comes to memcoins in the crypto community. Some people believe they add an element of enjoyment and lightheartedness that is sometimes lacking, while others argue they detract from the serious objectives of blockchain technology.

In episode 14 of “The Agenda” podcast, hosts Jonathan DeYoung and Ray Salmond have a conversation with Andreas Brekken, creator of – a crypto exchange without the need for sign-ups. They discuss the advantages and disadvantages of the memecoin craze and its potential impact on the broader crypto market.

Memecoins are making millionaires, but are they actually good for crypto?

The benefits of memecoin hype

According to Brekken, memecoins offer a simple and approachable entry point into the world of cryptocurrency for everyday people using only their smartphones. He also views memecoins as a low-risk method for individuals to experiment with crypto alongside their friends.

He maintained that memecoins contribute positively to the crypto community by encouraging people’s interaction with blockchain technology and enhancing their understanding of digital currencies. Moreover, they serve as practical experimentation sites for refining the underlying technology.

“We’re testing real stuff because the same technology we can use to trade memecoins is literally the same technology we use to trade any other assets on-chain or cross-chain.”

According to Brekken, the intense congestion on Solana’s chain will necessitate network enhancements for faster and more dependable performance. This, in turn, will prove advantageous for the blockchain in the long run.

When asked about what more established crypto projects can take inspiration from meme tokens, Brekken expressed admiration for how swiftly memecoins form robust communities. Additionally, he highlighted that several memecoin creators destroy their liquidity provider tokens to prevent early withdrawal of the project’s initial liquidity, showcasing their dedication and a practice other developers could adopt in the future.

Memecoin gambling

Many memecoins are acknowledged to have no substantial value or connection to the real world. Consequently, some people view investing in them as a form of speculation, with the hope of earning significant profits. However, it’s essential to note that a considerable number of memecoin projects turn out to be fraudulent schemes, which increases the risk that investors will lose all their funds.

Brekken drew a parallel between investing in memecoins and gambling in casinos or on sports: For some individuals, it’s a casual pastime where they spend a little money and enjoy the experience regardless of the result. In contrast, others risk large sums of money, suffer significant losses, and are left with feelings of remorse.

Instead, he suggested stepping back for a broader perspective instead of focusing on the small details of memecoins.

“Maybe the bigger question is, why are people gambling so much? I think one way to look at this is it may be that people are gambling because they don’t trust the system to give them a fair chance, and they’re looking at the inflation, and your money is becoming worthless all the time, and your salary is not going up. So it could be that it’s just a symptom of a financial system that people don’t trust.”

If you’d like to explore further insights from Brekken’s discussion with “The Agenda,” here are some key topics they covered: his perspectives on token names and free speech, the prospects of memecoins in the future, and how memecoin trends impact the wider crypto market. To delve deeper into these subjects, I recommend checking out the entire episode on CryptoMoon’s Podcasts page, Apple Podcasts, or Spotify. Don’t miss out on the wealth of information offered by CryptoMoon’s diverse selection of shows!

The content in this article is meant to provide general knowledge and isn’t intended as legal or financial guidance. The perspectives shared within are those of the author, and may not align with the views of CryptoMoon.

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2024-04-17 15:20