The cryptocurrency world is divided over the merits of memes, digital tokens inspired by internet jokes and pop culture references. Proponents hail them as a chance for explosive returns, while established figures like Bitcoin evangelist Adam Back deride them as a passing fad.
A risky journey on the hype train
Meme coins have taken the cryptocurrency market by storm in recent months. Tokens like Pepe and Dogwifhat Cryptocurrencies have seen a surge in value, fueled by online communities and celebrity endorsements. Influencer Iggy Azalea’s promotion of her own meme currency exemplifies this trend.
Analyst Murad Mahmudov sees potential in this space, but warns against highly speculative microcaps Meme parts – basically tiny startups in the crypto world.
This speculative frenzy is not without its critics. Ethereum co-founder Vitalik Buterin echoes Back’s concerns, saying that many Meme coins lack real-world applications or innovative technology. He questions their long-term viability.
Reminder, zoom out. Previous bull periods also saw half a dozen -30% declines. We are at about -26% (-27% previously).
in fact, the recent declines seem to be less deep, but people forget the normal bull market pattern. Don’t panic, buy the dip. or buy a little bit of $CMSTR with… pic.twitter.com/vBOjFN1TOn
— Adam Back (@adam3us) July 5, 2024
Back, famously mentioned in Bitcoin’s original whitepaper, has a history of dismissing meme currencies with characteristic bluntness. In 2021, he went after both meme creators and their creations.
The so-called “shitcoiners” They say they suck at making memes and the reason is obscure.
The co-founder of blockchain technology company Blockstream has further dampened the hype surrounding expensive meme-based NFTs like EtherRock, which sold for millions despite being, in his words, “a low-res gif that has no merit.”
Is Bitcoin the only “investment grade” cryptocurrency?
Back’s position is clear: Bitcoin is the only cryptocurrency with real investment potential. He views meme currencies and most alternative cryptocurrencies (altcoins) with suspicion.
This unwavering support for Bitcoin is nothing new. Back has repeatedly called Bitcoin “super cheap,” even when its price was hovering around $66,720 in April of this year.
He believes that the market is underestimating Bitcoin’s potential as a digital store of value, similar to gold. Back further argues that a few bear markets, like the recent price declines that saw Bitcoin fall to a five-month low, are needed for investors to truly understand Bitcoin’s long-term value proposition.
A battle of memes and fundamentals
The conflict between meme currencies and established cryptocurrencies like Bitcoin reflects a deeper debate about the future of digital assets. Meme currencies represent a bet on cultural relevance and community power.
Their success relies on their ability to maintain buzz and attract new investors. Bitcoin, on the other hand, relies on its established technology and growing adoption as a legitimate financial instrument.
Featured image from WSJ, chart from TradingView
