Yes, its name is “Fart Coin”. Yes, it’s completely useless.
Yes, though, its value has tripled in the past week, giving it a market capitalization of more than $700 million — roughly the same as the parent company of Office Depot, Guess jeanswear and Steak N’ Shake.
Cryptocurrency’s binge-worthy casino era is back with a vengeance, fueling a broader wave of Bitcoin investment spurred by Donald Trump’s election. It can hurt others as much as it creates millionaires – but everyone, even the losers, seems to be in on the joke.
Toe Bautista, a research analyst at decentralized finance group GSR, said the “memecoiners” wave consists of long-term Bitcoin holders and people eager to change their destiny in an era of high housing and stock prices. Bautista said that while many memecoin traders have benefited from Bitcoin’s 130% rise this year (50% of which has come since Trump was elected last month), they are simply “moving down the risk curve” into pure speculative areas. Others see the potential to make ten times their money overnight.
“A lot of people are thinking, ‘I can gain some kind of advantage by having a better chance of winning a lottery ticket,'” Bautista said.
Memecoin buyers and sellers are largely aware that their trading activities amount to the riskiest form of gambling, Bautista said. It’s all about exiting a position to avoid “baggage” and failing to trade and strike when prices are hot.
“Because they’re worthless, you’re betting on the ‘bigger fool,'” he said, referring to the idea that others will pay more for a given memecoin. “You think, ‘I’m here too soon, someone is going to buy these bags.'” But there’s no fundamental driver of its value.
In most cases, the biggest risk in memecoin trading is often based on the longevity of the viral Internet meme, which is the meme itself gradually drifting away from the cultural zeitgeist. In fact, for a very small number of people, the benefits of a given news cycle can be huge. Blockchain data shows that at least one holder of a token created in the wake of last month’s Squirrel Peanuts incident, which involved the death of a rodent who may have been killed in an unintentional attack, is sitting on nearly $500 million. Raised with permission from New York man.
Now, as the news report has faded from view, the price of the token, PNUT, has fallen by about half from its peak of $2.47.
However, memecoins also have operational risks, as The Rise and Rapid Fall of the “Eagle” CoinIt was released earlier this month by Haliey Welch, the Tennessee woman who turned a viral, raunchy street interview into a successful podcast.
Within 24 hours, Hawk’s market capitalization peaked at $500 million before falling to $28 million, prompting complaints of significant losses in funds. The complaints have not been independently verified by NBC News.
Facing accusations of insider trading, Welch issued a statement saying that neither she nor anyone on her team sold the tokens, but instead blamed “sniper” algorithm bots designed to sell off the tokens as prices began to surge. Tokens.
In fact, algorithmic trading has long been part of mainstream trading on Wall Street and is now routinely deployed in the memecoin space, Bautista said. He estimates that half of the top 20 coins by cryptocurrency trading volume are meme coins, with trading driven almost entirely by bots designed to spot and respond to price movements.
Is it legal? Some believe meme coins are allowed because the SEC has never officially classified Bitcoin as a security. However, the agency has taken action against exchanges that allow trading of other coins. And, crucially, many memecoins, including Fartcoin, appear to be unavailable for legal purchase from stateside in the United States on most cryptocurrency exchanges that offer them.
Ground zero for launching memecoins was a website called Pump.fun, which allowed users to “launch a coin that can be traded instantly and for free with just one click.” The site, which launched in January 2024, has generated more than $288.4 million in revenue since its inception, according to analytics data CoinTelegraph Quotea cryptocurrency industry publication.
Earlier this month, the UK’s Financial Conduct Authority said the website was not authorized in the country and warned anyone who interacted with products or services linked to the site that there would be no investor protection.
Notwithstanding the foregoing, the terms and conditions of this website provide that its provisions shall be governed by the “laws of England”.
A spokesman for the website could not immediately be reached for comment.
It may be the digital Wild West, but some tools have been developed to help unsavvy memecoin participants avoid outright scams. A website called Rugcheck.xyz claims to be able to scan memecoin ownership data to determine whether a player or a small group of players has the ability to make judgments about market size. Pump.fun itself says it prevents “carpets” or sudden price drops by ensuring that any tokens it launches do not undergo pre-sales or small-batch distributions that benefit insiders.
It’s unclear how long the current cryptocurrency “bull market” cycle will last, but at least one analyst believes that given possible developments next year, namely the possibility of further interest rate cuts by the Federal Reserve and the implementation of more favorable policies by the Trump administration, Cryptocurrency Policy.
Gracy Chen, CEO of cryptocurrency group Bitget, told NBC News: “There are many events in 2025 that can help drive Bitcoin and cryptocurrency prices further upwards.”
In fact, Trump World is already showing signs of accelerating its embrace of cryptocurrencies. Bloomberg News reported Friday “Trump-inspired” cryptocurrency initiative World Liberty Financial has been buying millions of dollars worth of tokens other than Bitcoin, suggesting a decentralized finance lending platform could be launching soon. Trump is designated as the ultimate “economic beneficiary” of freedom in the world.
A spokesman for World Freedom Group did not respond to a request for comment.
However, there is clearly a dark side to the memecoin world. Omid Malekan, who teaches cryptocurrencies at Columbia Business School at Columbia University, said this is a symbol of the economic “nihilism” that has taken root among many young Americans who feel they have been priced out of the American dream. .
“All these kids will say, ‘All the good stocks are too expensive. What about the house? I can’t afford it,'” Malekan said. “So, ‘I’ll bet something that ’10x’ my money, and if I lose everything, who cares, I’m screwed anyway.'”
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