Meme coins are cryptocurrencies based on memes, such as Doge, the Shiba Inu, which became everyone’s favorite in 2013. As the growing community pushed for its fame, the cryptocurrency, based on the meme, became the seventh-largest digital currency in the world.
While meme coins are believed to have no use case, they bridge the gap between entertainment and productivity. Inspired by Donald Trump’s brand, the $Trump meme coin emerged as a viral trend. However, there is no direct confirmation of Trump’s involvement..
The $Trump coin has a maximum supply of one billion tokens and operates on the Solana blockchain. On January 17th, the president introduced the official Trump meme as a collectible digital token, and its popularity quickly grew.
So, what else is there to know about the Trump coin?
Trump coin is a cultural symbol
Most meme coins gained value through their supporting communities, as their cultural dynamics mattered more than the joke itself. That’s how the Dogecoin and Pepe coin evolved on the market. Therefore, the Trump coin’s value also comes from its cultural symbol, representing the US President.
The President stated that cryptocurrency was not intended as an investment or security and was far from influencing any political campaign. Still, its price boomed by over 300% a day after the launch, showing the power of supporters, investors, and traders.
Trump coin ownership is a bit more complex
Although there will only be one billion tokens in circulation, only 200 million are available at the moment. The rest will become available on a special schedule over the next three years. However, these coins represent only 20% of the total tokens left after the initial coin offering (ICO).
The remaining 80% is split between CIC Digital LLC and Fight Fight Fight LLC. These companies were behind the Trump coin project and also worked in previous establishments that sold non-fungible tokens (NFTs).
The Trump coin success might nurture changes in the industry
Rumors of tax cuts on crypto followed the token’s rise in popularity and value. From an economic overview, cryptocurrency is seen as property, so sales, trades, and disposals of it translate into capital gains taxes. At the same time, short-term capital gains are subject to higher tax rates than long-term ones.
Therefore, considering the coin’s accomplishments, some believed the taxes could be lower, especially since Trump declared he wanted to turn America into the world’s crypto capital. Trump has previously spoken in favor of making the U.S. a crypto-friendly nation, though no executive order on the matter has been signed.
Trump has previous experience with the World Liberty Financial project
The decentralized finance protocol World Liberty Financial was launched in 2024 to offer traders a space for cryptocurrency investments. The DeFi platform provides access to the $WLFI token for equal voting power and proposal creation access, and it contributes to the development of DeFi in America.
The company recently developed a token reserve plan to support the development of Bitcoin and Ethereum. The reserve might sustain market volatility and, as a well-capitalised reserve, allow WLF to invest in creative crypto projects.
$Trump is accompanied by Melania’s coin
The Official Melania Meme coin followed Trump’s launch, and their features are similar. With a total maximum supply of one billion and a Solana token address, both cryptocurrencies serve as digital collectibles instead of investments. The $Melania token is part of Melania Trump’s company, MKT World LLC.
The effect on the market following the launches of these two coins was significant. Traders were more optimistic than ever, amplifying Bitcoin and other prominent cryptocurrencies, offering a favorable investment ecosystem. At the same time, the prospect of future crypto-friendly regulations made traders enthusiastic.
Do meme coins have a future?
While everyone seems to have a meme coin now, some are unsure about their long-term profitability. Users often see them as assets for entertainment since they come from literal memes on the internet, but some have proven utility and potential.
Meme coins can have legitimate investment opportunities, and Dogecoin and Pepe coins are proof of this. Doge coin’s market capitalization reached incredible heights, overthrowing Cardano or Tron. At the same time, the Pepe concept expanded, allowing for billion-dollar investments like Purple Pepe.
Most meme coins are supported by either Ethereum or Solana, two innovative blockchains whose features of smart contacts and unique programming languages allow them to be as interesting as possible. Therefore, as long as blockchain technology allows for cryptocurrency creation, meme coins will thrive in a crypto-friendly ecosystem.
Are there risks to meme coins?
Despite their massive potential, meme coins can be risky for those with little experience. Since anyone can create meme coins, pump-and-dump schemes exist in which the project promises massive returns and then sells off the coins.
You can learn how to spot such challenges by identifying:
- The anonymity of the development team;
- The unrealistic tokenomics and supply;
- The low liquidity which can expose you to market manipulation;
- The lack of audits and security measures;
Still, fake partnerships and endorsements are the easiest way to recognize a pump-and-dump scheme. Unfortunately, they’re becoming convincing enough for a larger audience, so verify their authenticity before investing. Most appear on social media, where well-known figures support them.
Excessive hype surrounds these posts and projects, which cannot be proven by organic engagement. Aggressive marketing tactics still work today, but don’t be too impressed by the inflating price of a coin and misleading information. Sooner or later, the fake developing team will leave all the investors with significant losses and no traces.
What’s your take on the Trump meme coin?
The recently launched Trump meme coin makes waves on the crypto market, gaining value rapidly over other meme coin projects. Along with the Melania meme coin, the two tokens have the purpose of entertainment by being a digital collectible. Therefore, they’re not linked with any security or investment use case, and there’s no political context in which the coin is growing.
The above information does not constitute any form of advice or recommendation by London Loves Business and is not intended to be relied upon by users in making (or refraining from making) any finance decisions. Appropriate independent advice should be obtained before making any such decision. London Loves Business bears no responsibility for any gains or losses.
Leave a Comment