Despite Musk’s Latest Memecoin Pump & Dump, The Future Looks Promising
On New Year’s Eve, Elon Musk got up to his usual crypto shenanigans, changing his name on X to “Keikus Maximus” and causing the once obscure memecoin of the same name to explode, with its value growing more than 4,800% in a matter of hours.
The market capitalization of the KEIKUS token consequently soared, reaching $380 million as the crypto community rushed to cash in on Elon’s latest craze, but just as quickly as it rose, it almost immediately crashed back to its original value, with the entire rollercoaster ride playing out in less than 24 hours.
It was just the latest in a string of memecoin pumps and dumps associated with Musk, who has become legendary for picking out previously unknown tokens, hyping them through X, only to watch them fly sky high before immediately crashing back down to Earth.
The likes of Dogecoin, Shiba Inu, Pepe the Frog and Milady Meme Coin have all benefited from Musk’s attention to some degree, but many so-called experts warn that these memecoins are little more than Ponzi schemes, with no underlying value that attract enthusiasts with very little financial nous, and cause many of them to lose money.
However, there are plenty of voices around who argue in favor of memecoins, saying we shouldn’t write off these gimmicky tokens based on memes or cultural events so soon. For there are plenty of crypto collectors out there who have made substantial sums of money by betting on memecoins.
What’s more, there’s no denying memecoins are absolutely booming, as one of the fastest growing segments within the crypto industry. Looking back to January 2024, the total value of all memecoins was estimated at around $20 billion, but that number had soared to more than $120 billion by the end of the year.
Some of the strongest advocates of memecoins include reputable investors such as Paul Veradittakit of Pantera Capital, who last year wrote a strong argument in favor of the joke-based tokens, saying they provide incredible opportunities for investors to make stunning gains.
Veradittakit highlighted how memecoins, despite originally having little purpose, are helping to play a role in kickstarting activity on blockchain networks. This has been recognized by some of the biggest blockchains, including Avalanche, which last year created a $100 million “culture fund” for memecoin developers. Meanwhile, the Blast Network has developed its very own memecoin, called Blast Gold, to reward users who engage with similar tokens.
Fact is, memecoins have a natural appeal to crypto users as a celebration of the industry’s underlying culture, helped by the fact that smart investors can earn enormous rewards for dabbling in them, so long as they get lucky and choose the right coin.
There are more than a few success stories that underscore this idea. According to Cointelegraph, one lucky individual snapped up $66 worth of Keikus Maximus tokens prior to Musk’s tweet on X, and suddenly saw their investment sky-rocket to almost $3 million. They were able to sell $201,000 worth of tokens, but perhaps somewhat misguidedly opted to keep the remaining $2.85 million worth.
Another recent example is LADYS, a memecoin founded in 2023. Musk tweeted about LADYS shortly after its launch, sending its market cap from almost zero to above $100 million.
Musk’s love of Dogecoin is also well known. Created in 2013 as a tribute to the popular Shiba Inu dog-based meme “doge”, it was one of the first memecoins to gain attention. After coming to the attention of Musk, who tweeted about it for the first time back in Feb. 2021, its value jumped more than 50% in just a couple of hours, in what was the first example of the SpaceX and Tesla founder pumping a memecoin.
Unlike many others, Dogecoin has maintained its value and become one of the most recognizable cryptocurrencies. With the recent creation of the Musk-led Department of Government Efficiency (DOGE) by the incoming U.S. President Donald Trump, Dogecoin’s status as a top token now seems set in stone.
The success of Dogecoin and many other meme tokens like Pepes suggests that this is a phenomenon that’s likely to stick around, and that argument is backed by the strong presence of memes in crypto culture in general. And with Trump set to take office as the first-ever pro-crypto president, there are many who believe memecoins will continue to go from strength to strength.
Toe Bautista, a cryptocurrency analyst at GSR Research, recently told the New York Post that memecoins are no different to any other tokens in that they generally seem to follow in the footsteps of Bitcoin. And many are convinced that Bitcoin’s value will continue to grow under Trump’s presidency.
“When Bitcoin goes up, memecoins further down go up too,” Bautista said. “Investors are curating what they think the future looks like, and the capital is chasing it.”
It must be pointed out that there are plenty of investors who lose big when betting on memecoins. Infamous examples include the HAWK token, which was designed to pay homage to the “hawk tuah” meme started by TikTok user Hailey Welch that went viral last summer.
The HAWK token launched last December and its market cap exploded, reaching $490 million, only to collapse below $100 million in less than half an hour. As of today, its market cap has flatlined at just $39,000, meaning the tokens are now completely worthless.
However, not all memecoins are as useless as people claim them to be. There’s a lot of expectation around the upcoming Wall Street Pepe (WEPE) token that has so far raised more than $45 million in its ongoing presale. That’s because it offers utility for token holders in the shape of promised trading signals and staking rewards, as well as community bonuses.
There’s also a lot of promise around AI-generated memecoins like GOAT, which recently hit a market cap of over $800 million in November, and is still going strong at around $340 million today.
Other examples include LADYS, which successfully built on its short time in the limelight courtesy of Musk by raising money from outside investors to foster a growing community around itself. These days, it is a celebration of memecoin culture itself, pitching itself as a “tokenized, fully memetically optimized white pill” that aims to foster “playful interactions” with other memecoin communities. It plans to encourage competition between memecoins, so that more of them can create some kind of utility to sustain themselves.
Veradittakit says that all the evidence suggests that memecoins are here to stay, if only because they represent a fun social activity for the crypto community.
“Our current Gen Z Pantera interns are having a lot of fun with their friends degening into newly launched memecoins as a simple and fun way to socialize, connect, and experience drawdowns and upsides together,” he wrote. “Secondly, memecoins greatly supercharge platforms and applications. While they are an incentive mechanism that can help spread doge memes, memecoins can greatly enhance NFT projects, social protocols, and entire blockchains.”
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About The Author
Gregory, a digital nomad hailing from Poland, is not only a financial analyst but also a valuable contributor to various online magazines. With a wealth of experience in the financial industry, his insights and expertise have earned him recognition in numerous publications. Utilising his spare time effectively, Gregory is currently dedicated to writing a book about cryptocurrency and blockchain.
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Gregory, a digital nomad hailing from Poland, is not only a financial analyst but also a valuable contributor to various online magazines. With a wealth of experience in the financial industry, his insights and expertise have earned him recognition in numerous publications. Utilising his spare time effectively, Gregory is currently dedicated to writing a book about cryptocurrency and blockchain.
