Compiled | Wu Blockchain
Original link:
https://x.com/nic__carter/status/1850530740217196766
As the 2024 US presidential election approaches, discussions about memecoins have become a hot topic on Twitter within the crypto community. Their dramatic price fluctuations, rapidly growing user base, and confrontational nature with the mainstream financial world have made them a unique market phenomenon. On the evening of October 27th, several well-known influential figures in the crypto world engaged in a heated discussion about the future direction of memecoins.
Omid Malekan: Memecoins and Economic Populism
The trigger was a long article about memecoins published by Omid Malekan, a professor at Columbia Business School and a blockchain writer, on the X platform. (Omid Malekan is well-known for his ability to explain complex cryptocurrency phenomena to the public in a concise and easy-to-understand manner, earning him the title of "explainer"). In his tweet, Omid Malekan first wrote, "Memecoins are a manifestation of economic populism, a rebellion against the token economics supported by venture capital."
He pointed out that the popularity of memecoins reflects investors' dissatisfaction with the existing token issuance mechanisms, especially those controlled by venture capitalists, which often lack transparent distribution and fair circulation mechanisms. Malekan further explained that this current phenomenon is partly driven by the regulatory policies led by SEC Chairman Gary Gensler and Senator Elizabeth Warren. The stringency of these policies has forced the crypto market to adopt extreme measures such as geo-blocking airdrops and VPN blocking.
However, Malekan believes that if the Republican Party wins the upcoming US election, these policies will undergo significant changes, and the regulatory environment may become more relaxed. He wrote, "A Republican victory will bring back mechanisms like ICOs and airdrops, which can provide actual economic benefits to token holders, something that memecoins lack." He concluded that if US cryptocurrency regulation returns to rationality, this will have a negative impact on the memecoins market, as the market will refocus on decentralized applications (dApps) and other projects with more real value, leading to a long-term bear market for memecoins. "Every joke has an end," Malekan warned investors, hinting that memecoins will ultimately lead to losses for most people.
Nic Carter: The Memecoin Phenomenon Under SEC Pressure
Subsequently, the famous crypto venture capitalist and partner of Castle Island Ventures, Nic Carter, quoted Malekan's long article and shared his own views. Carter tweeted, "Memecoins are largely a reaction to the SEC's oppressive regulation. If the SEC finds rationality, the demand for trading memecoins will decrease."
Carter further explained that although the demand for memecoins may decrease, there will always be a portion of people who continue to trade memecoins, as this phenomenon has been going on for a decade. Carter emphasized that the appeal of memecoins comes from their implication of equality, but he also pointed out, "Once those so-called 'evil venture capitalists' - that is, institutional capital - learn how to leverage memecoins, they will coordinate activities to drive up memecoin prices, and ordinary investors will only learn about it when the token market cap has already reached $1 billion." Carter warned of the potential inequality in the memecoin market, where institutional capital will ultimately take over these seemingly grassroots market opportunities.
Cobie: Early Participation Opportunities in Memecoins
Another KOL, Cobie, replied to Carter's tweet, stating, "The reason memecoins are popular is that people want to buy assets that can appreciate in price, rather than those that have already reached multi-billion dollar valuations and are in long-term decline." Cobie pointed out that it is increasingly difficult for ordinary investors to participate in non-memecoin projects early on, as most projects have already gone through multiple private rounds by the time they are officially listed. He believes that "even if the SEC's policies shift to support DeFi, the reality is that no one wants to buy assets on Binance."
Andrew Kang: Rethinking Token Economics Design
Andrew Kang, a partner at Mechanism Capital (another more well-known identity is a crypto mega-bear who went from 0 to nine-figure assets), also joined the discussion. Kang criticized the existing token lock-up design, arguing that long-term lock-ups not only have not had a positive impact, but have instead increased market instability. "It's best not to set investor lock-up periods, but to get as many tokens into circulation as possible on day 1."
Kang further explained, "Long-term unlock periods only postpone the problem and become an ongoing challenge for project teams." He advocated for more tokens to enter the market during the Token Generation Event (TGE), believing this can avoid the market volatility caused by subsequent long-term unlocks. He pointed out, "All market participants are potential sellers, and lock-ups do not change this. A free market trading environment is the best solution to address the long-term volatility in the crypto market."
Toly Yakovenko: Memecoins as Entertainment
In contrast to the serious discussions of the above KOLs, Toly Yakovenko, the co-founder of Solana Labs, jokingly replied to Malekan's tweet, "Trading memecoins is a form of entertainment. It's like Keynesian beauty contests, guessing what others find most interesting. Trading other assets is work. If possible, people would prefer to do less work and more entertainment." Toly Yakovenko's view emphasizes the irrational aspect of memecoins, where investors are more willing to treat them as a form of entertainment rather than a serious economic activity.
Murad Mahmudov: Memecoins and Global Money Supply
Finally, Murad Mahmudov, a meme top-tier KOL who recently gained fame at Token 2049, also joined the discussion. Murad replied to Malekan's long article, stating, "99% of memecoin buyers don't care about politics at all, the rise of memecoins is directly related to the continued growth of the global money supply, not the outcome of an election."
Murad emphasized that the increase in the global money supply is the key factor driving the rise of memecoins, and even a Trump victory would not change this fact. He further stated, "Memecoin buyers don't even care about trading assets with legitimate income and open expense switches. The increase in global money supply has made attention more important than fundamentals and cash flows." In his view, as liquidity becomes increasingly abundant in the global economy, attention resources in the market have gradually replaced traditional economic fundamentals as the key factor determining the value of memecoins.
