Fueled By Election Buzz, Memecoins Soar 22% On Pure Speculation—Report

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As a seasoned researcher with years of experience delving into the intricate world of cryptocurrencies and blockchain technology, I find myself constantly amazed by the unpredictable yet captivating nature of memecoins. Their rise and fall, much like a rollercoaster ride, have become a staple in our digital economy.

Memecoins are crucial to the blockchain and the cryptocurrency community, and Binance Research highlights their unique value proposition.

Based on Binance’s report, it appears that the surge in memecoins mirrors the global increase in money supply. As funds and capital become more easily obtainable, speculative investments such as Bitcoin, alternative coins (altcoins), and memecoins become appealing choices for investors seeking high-risk opportunities.

Although memecoins promise a strong upside, they are also a high-risk investment since they’re highly speculative and have few use cases. However, their recent performance seems to defy the odds—their market cap was up by 22% immediately after the US election.

On this particular Wednesday, Dogecoin (Doge) and Pepe Coin have emerged as two of the most successful cryptocurrencies, each experiencing a growth spurt. Dogecoin’s value surged by approximately 15%, while Pepe Coin saw an increase of around 11%.

Binance Research: 75% Of All Memecoins Were Launched Last Year

Based on a study by Binance in November 2024, meme currencies are gaining traction due to an increased interest in high-risk investments. The report also indicates that the overall money supply is increasing, leading more retail investors to explore alternative avenues for accumulating wealth. The market value of this specific sector has tripled since 2022, largely driven by the popularity of these coins.

According to Binance’s report, the regulatory body expressed skepticism towards Initial Coin Offerings (ICOs). As a result, project developers may opt for private funding from Venture Capitalists (VCs) instead. This strategy, known as “Low Supply and High Market Cap,” implies that fewer tokens are circulating in the market but have a higher estimated value.

Memecoins Remain An Accessible Investment Option

The method advantages programmers and early users, but it might pose risks for ordinary investors. Consequently, many everyday investors seek memes as alternate investment possibilities. This is the main reason behind the popularity and accessibility of meme tokens to everyone.

Approximately 75% of the so-called “meme currencies” were introduced last year, as stated by Binance. The team at Binance noted that while launching these projects may seem straightforward, maintaining their operations can be quite difficult. According to the report, a staggering 97% of all memecoins have already ceased to exist, and those that remain are struggling. However, they have managed to survive by capitalizing on the election frenzy this year.

Memecoins Jump by 22% In A Day, Thanks To Election Hype

These coins, often seen as communal investments and accessible for all, carry a significant degree of risk and speculation. Numerous members within the community have wagered on what’s known as a “meme coin boom” that would align with Bitcoin’s growth. The gamble proved successful, causing the total market capitalization of memecoins to surge above $73 billion – an increase of 22%.

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2024-11-07 22:16