The crypto markets witnessed yet another ‘pump and dump’ of a token, which has raised concerns about the future of the memecoins. The Argentinian president announced the launch of a memecoin LIBRA similar to that of U.S. President Donald Trump’s OFFICIAL TRUMP. Soon after the announcement, both the tokens witnessed a huge influx of liquidity, elevating the tokens by a huge margin. Soon after the LIBRA initiated its trade with the levels above $1, the insiders cashed out, dragging the levels by over 90% within 3 hours of the launch.
While TRUMP faces a similar consequence in a couple of days, LIBRA dumped in just a few hours. The TRUMP team liquidated their holding with over 70% of tokens being locked and LIBRA’s insiders cashed out where tokenomics was not shared with the traders. Does this suggest the ‘Celebrity Coins’ are lowering the credibility of the memecoins? Or is this because the Bitcoin dominance has not raised enough?
Will the Traders Gain Back Confidence Over the Memecoins?
In the past 30 days, the memecoin market capitalization has witnessed a 30% pullback, while a notable rise of over 68% was recorded in the volume. The top gainers in the same period failed to record the popular and the largest ones like Dogecoin, Pepe, or the newly launched like WIF, BONK, or POPCAT. This suggests the traders are no longer attracted towards the utility or use cases of memecoin but just as a quick profit-gaining tool.
With the rise in such types of tokens, a popular analyst anonymously called Seth called out for stronger crypto regulations. He says,
Crypto needs regulations. This ruins the reputation for Crypto
While some refused, some believed regulations could help not only the memecoins but may save the reputation of the entire cryptos. The crypto space is comprised of many gems that can address many real-world issues. Hence, when these fail to gain the required buying volume and all the volumes are poured into these scam coins, it is not a good signal for the crypto space. Besides, the influential people should also hold some accountable for the losses incurred by the retail traders due to the collapse initiated by their team.
However, as long as the market participants continue to dream of a quick profit or becoming overnight millionaires, many other pump & dump tokens will continue to squeeze millions in the coming days.
