Those crazy memecoins are at it again. What are they, and what’s happening to the crypto market now that Elon Musk is pushing them?
Money is worth whatever people think it’s worth. Even the mighty U.S. dollar has always been backed by something else of value, whether it was the Spanish silver dollar (the “piece of eight,” and the world’s first international currency), silver itself, gold, or the collateral provided by the Federal Reserve Banks. Having the world’s largest military helps, too.
So why should memecoins (also spelled as “meme coins”) be treated any differently? This form of cryptocurrency doesn’t have anything of tangible value behind it, but people are out there buying up memecoins like they’re hotcakes – especially any coin associated with Elon Musk.
Now that Musk has essentially taken over for J.D. Vance (remember that guy?) as Trump’s new running mate, the Republican corners of the political and crypto betting markets are cranking into overdrive. Dogecoin (DOGE) is worth 14 Lincoln pennies as we go to press, up nearly 30% since Musk joined Donald Trump on stage in Pennsylvania on October 5.
Speaking of DOGE, Musk has also floated the establishment of the Department Of Government Efficiency under a second Trump presidency. This particular DOGE would decide which of the government’s 400-plus federal agencies would be eliminated; it’s widely assumed Musk is aiming to de-regulate his own industries and interests, crypto included.
Does this mean we’ll be paying our bills in Dogecoin under the new Trump-Musk regime? Maybe not, but if you’re looking for a sharp play on the crypto odds board, start by getting to know the ins and outs of memecoins with this quick introduction.
What Are Memecoins?
Memecoins are a form of cryptocurrency that was first popularized in 2013 as a satirical critique of the larger crypto sphere. Software engineers Billy Markus and Jackson Palmer created Dogecoin, a peer-to-peer digital currency featuring the shiba inu dog Kabosu from the viral “Doge” meme on its official logo. It was ostensibly meant as a joke, but Dogecoin itself went viral, and was up 300% within two weeks of its release, all the way from $0.00026 to $0.00095.
That’s right: just like the Bitcoin it was supposed to satirize, Dogecoin is up massively since it first hit the market – about 25,000% as we go to press. Granted, DOGE is also down massively from its 2021 peak of 68.78 cents. Bitcoin has its ups and downs, too, but not this pronounced.
Now there are more memecoins than you can shake a stick at. Many of them are variants based on the Doge meme, including a fork of Dogecoin called Floki Inu (FLOKI, up about 45% since October 5) based on Musk’s own pet dog. Other hot sellers are based on Musk himself, including Elon (ELON, up about 35%); there’s even a Department Of Government Efficiency memecoin (also DOGE, up 225%).
Why Are Memecoins Soaring?
In the short term, because of Musk. He’s been tweeting about Dogecoin for years, but everything’s gone nuclear since the first apparent assassination attempt on Trump back on July 13 – that’s when Musk really started ramping up his public support for the MAGA cause.
Looking at the larger picture, the 2024 U.S. election is what brought Musk and Trump on stage together, as they (and their allies, both at home and abroad) try to convince the American public to vote Republican. The Trump odds to become president have soared from around even money to –160 at [sportsbook id=”Bovada”/] (find out more with our [review id=”Bovada”/]) since early October; some of Musk’s own money may have been used to inflate those odds, and Musk’s own holdings in Dogecoin are certainly benefitting from his endorsement of all things DOGE.
As with any speculative investment, whether you’re betting on crypto or thinking of investing, it makes good sense to protect yourself by limiting your memecoin holdings to a small percentage of your portfolio. Individual coins may come and go, just like the memes they’re based on, but if you keep one eye on the cultural zeitgeist and the other on your crypto wallet, you’ll put yourself in the best position to profit.
