President-elect Donald Trump’s inauguration celebration started early this weekend with the release of the TRUMP and MELANIA memecoins, and resulting demand that drove their combined market cap to a high of more than $17 billion dollars, surpassing the value of both shiba inu (SHIB) and the Avalance blockchain’s AVAX.
One might ask how investors had that amount of capital on the sidelines at a time when bitcoin (BTC) was teetering around another all-time high. The truth is, they didn’t. The capital pumping the price of Trump’s token was simply a reallocation from existing memecoins that have buoyed the crypto market over the past year.
While some investors reportedly become overnight millionaires, a nasty sting in the tail may await for investors in the memecoins, which are tokens with no inherent utility whose value is determined purely by market demand. With a price that’s driven by popularity, they’re likely to take a hit when the next shiny new coin comes along.
“Everyone knows this is a grift, this isn’t going to be around in four years and there’s nothing of value here.” prominent scam hunter Coffeezilla said in a YouTube video.
When TRUMP was issued early Saturday, the exodus from the likes of dogecoin (DOGE), shiba inu, pepe (PEPE) and popcat (POPCAT) began.
POPCAT has lost 42% of its market cap since TRUMP launched, SHIB and DOGE are both 15% lower and PEPE is down by 22%. The combined market cap loss from these four tokens alone is $13.5 billion, and that doesn’t include the double-digit declines of WIF, BONK and 100’s of other memecoins.
TRUMP itself took a hit when MELANIA was released, losing 58% of its value and reflecting the fickle nature of speculative memecoins. Together they’re now valued at just $11 billion, with $6.3 billion withering away over the past 24 hours.
It’s worth noting that the market cap of crypto tokens is defined by circulating supply multiplied by asset price. Varying levels of liquidity mean that not all of that supply can be sold at once, so the true market cap figure is actually lower than seems. Even so, a reduction in the market cap of one meme and the increase in ano
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Author: Oliver Knight
