Memecoins are a gamble — and they’re almost always scams. What motivates crypto buyers to continue losing their money for bad reasons?
In 2013, the launch of a dog-themed crypto token as a private joke between a couple of software developers was a harmless piece of fun. The fact that Dogecoin (DOGE) has since amassed a market capitalization greater than $13 billion (as of Dec. 13) is beyond the understanding of most investors, but it seems like it’s here to stay. The sector that DOGE has inspired, though, is becoming a menace to an industry that needs to evolve.
Memecoins are dangerous. They are dangerous because the large majority of those who put their money into them never see it again; they are dangerous in the way they damage the credibility of the entire cryptocurrency industry; they are dangerous in the way ownership is so highly concentrated, and they are dangerous because they are proliferating.
As of Dec. 13, there are around 1,300 memecoins in circulation with a collective market cap of about $22 billion, a sizable figure. However, take a close look at the CoinMarketCap memecoin sector, and you’ll notice that nine of those listing pages contain utterly worthless coins.
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Author: Lucas Kiely
