Meme coins have been all the rage recently, and political meme coins have been particularly interesting.
The US election battle is moving to the crypto arena, with political meme coins being in the spotlight. Did you know that you can buy Joe Biden and Donald Trump-themed meme coins? These are hot crypto assets these days, showing extreme volatility.
Related: Trump-Labeled Wallet Turns Meme Token into Million-Dollar Goldmine
Let’s explore the PoliFi meme coin market to figure out where all this is going.
The Rise of Political Memecoins (#PoliFi)
Meme coins have been skyrocketing since the end of 2023, mainly driven by an increased appetite for riskier assets amid a general bullish sentiment. At the beginning of 2024, the US Securities and Exchange Commission gave its nod to the first Bitcoin spot exchange-traded funds (ETFs), accelerating the crypto recovery, and meme coins have been one of the main beneficiaries.
The focus has shifted from popular meme coin giants like DOGE to lesser known coins with vibrant communities. Solana-based meme coins have been the most active ones.
While politics itself may be boring for many, meme coins related to politics (PoliFi) have been making waves during the last few months, becoming a league of their own. Many of these leverage Solana’s high-speed chain.
As of mid-March 2024, the total market cap of meme coins is almost $50 billion, up over 100% since mid-February. So-called PoliFi meme coins account for only 1%, but they’re quite visible due to their high-growth potential and the intensifying political tensions ahead of the US election.
Now guess who is the politician with the most popular coin? That’s an easy one, right? It’s Donald Trump, who’s fighting to retake the US throne.
MAGA coin (TRUMP), has a market cap of $220 million as of this writing, down 50% from its record high hit earlier this month at over $450 million.
Obviously, Joe Biden fans couldn’t watch as bystanders, so they came up with their own version of a meme coin. Nope, it’s not called “Let’s Go Brandon,” it simply uses the misspelled name Jeo Boden (BODEN). As of now, the token has a market cap of $134 million.
Impact of Political Events
It doesn’t take a rocket scientist to realize that the political meme coin ecosystem is led by Donald Trump and Joe Biden-themed coins due to the upcoming US elections scheduled for this November. In fact, the majority of PoliFi coins are related to Donald Trump alone, as he has more chances to win the elections and has a more active crypto fan base.
Latest polls show that former President Donald Trump has a narrow lead versus the current President Joe Biden, suggesting that in the case of a win, Trump-themed coins may thrive.
Biden has lost ground amid concerns about his age and the high cost of living following a multi-month period of surging inflation. Speaking about his age… I mean, we can create a full-length movie with all of his gaffes, but c’mon man, the guy is cool.
Immigration has emerged as another major election issue, as the US is dealing with a worsening crisis with record arrivals of immigrants at the border with Mexico. Joe Biden is facing growing criticism from Republicans for letting a record increase in illegal migration.
With US elections just around the corner, the poll dynamics may have a direct impact on the performance of political coins.
As it stands, the emerging political meme coin subsector is dominated by Trump and Biden coins, and the only alternative is the MILEI token that pays tribute to Argentina’s President Javier Milei, who has been in office for about 3 months. But I mean… I don’t know how much that is really an alternative. The guy called the Pope an ‘imbecile’ and then invited him to Argentine and was happy to meet with him in Rome.
Market Dynamics and Speculation
MAGA is the largest PoliFi meme coin by market cap and the oldest one. It is the first experiment of its kind, managing to build an active community. MAGA has over 20k followers on X and a sexy landing page.
The TRUMP token has outperformed the crypto market by a margin, as Trump has been winning state after state to consolidate his leading position among Republicans.
The token hit a record high at the beginning of March at around $12, after which it corrected to the current level of $5.10.
The correction came amid a stagnating Bitcoin, which has shifted to a wait-and-see mode after updating its all-time high. Also, Donald Trump is dealing with several active trials and has recently faced pressure in the primaries to consolidate his leading position among Republicans.
Still, Trump’s rebel image is making MAGA an attractive investment. MAGA’s marketing director, Steven Steele, reportedly said:
In the meme scene, people want a rabble-rouser, someone exciting and unpredictable, perceived as a total rebel. Trump embodies all of those qualities in the eyes of many.
The performance of MAGA and BODEN is like a betting race before the US election.
Elsewhere, BODEN has increased rapidly in March, hitting a record peak at over $0.23 on March 14, before correcting to the current level of $0.18.
Regulatory Considerations
Meme coins are in a regulatory gray zone, and their future is still uncertain. While they may be part of a fluid culture, financial watchdogs are keeping an eye on them.
In November 2023, the US Securities and Exchange Commission (SEC) charged SafeMoon creator and other executives for promoting a ‘fraudulent scheme.’
This is a warning for other meme coins that have no utility but may be treated as securities by the SEC.
Investment Opportunities and Risks
Despite their fast-growing popularity, meme coins are a very risky business. With no utility, their entire value depends on how active their community is and how strong is the social media hype. I wouldn’t recommend crypto investors allocate the lion’s share of their crypto portfolio to meme coins.
Yes, their rapid expansion may be attractive, but they are the most unpredictable assets in the blockchain market, making it difficult to build a portfolio backed by robust fundamentals. I mean, what kind of fundamentals are we talking about?
More Info:
- Mathematics vs Bitcoin, Political Donations, MATIC Market Trends, and AI Advancements
- Javier Milei: New Political and Crypto Era in Argentina
- New Speaker in the House & What It Means for Digital Assets
A recent report by Chainplay, which polled 1,503 crypto investors from around the world, found that 70% of respondents believed that the majority of meme coins are scams, although 69% of them still invest for fun.
So I guess this is the right approach: investing for fun but knowing that you can get rekt at any time.
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