Crypto Analyst Says Memecoins Serve Founders, Not Communities As $PEPE Gains Ground

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A popular cryptocurrency analyst recently suggested that the popular meme-inspired cryptocurrencies that have flooded the market exist to help enrich their founder and not to create real communities seeking to help the ethics of cryptocurrency consisting bank the unbanked.

Benjamin Cowen, a popular analyst with over 700,000 followers on the microblogging platform Twitter, noted that these meme-inspired cryptocurrencies, a strong community narrative, are garbage and help most of these pieces are created by the same group, just pumping and dumping until it’s gone is profitable.

Daily reminder that these memecoins flooding the market exist to enrich the founders.

The strong community narrative is trash.

Most of these memes are created by the same group, pumping and dumping until they are no longer profitable.

Benjamin Cowen (@intocryptoverse) May 9, 2023

Although Cowen did not refer to any specific cryptocurrencies, his comments come at a time when some meme-inspired cryptocurrencies, including Pepe Coin ($PEPE) and Shiba Inu ($SHIB), have been widely adopted, although they are best known for their internet meme. origins than any technological innovation.

As CryptoGlobe reported, when listing the meme-inspired cryptocurrency, major exchange Binance warned potential investors that PEPE has no inherent utility or value support mechanism. PEPE was charged with potential insider trading, as 7% of the total token supply was allegedly purchased by insiders or team members within minutes of the token generation event.

Despite warnings about the potential ability of contract owners to modify transaction taxes and blacklist functions, the PEPE market has seen a remarkable boom. It is now among the top 100 digital assets after several centralized stock exchange listings.

Earlier, a lucky cryptocurrency investor apparently managed to turn an investment of just 0.125 ETH in PEPE into a staggering $1.14 million in just a few days by buying there at the right time.

The crypto industry seemed to resonate with Cowens’ concerns. A crypto enthusiast added that investors who fail to make a profit and withdraw their initial investment risk becoming exit liquidity, no matter how strong the coin community is.

Memecoins continued to gain ground nonetheless. $DOGE and $SHIB combined have a market capitalization that now exceeds the market by $16 billion as they are widely adopted as accepted payment methods around the world.

On the other hand, PEPECOIN, the new kid on the block, launched only a month ago and already boasts a market capitalization of over $629 million despite its lack of usefulness.

The rapid rise and potential volatility of meme coins presents significant risks for investors, especially those who may be new to the world of cryptocurrency, as many end up underwater after purchase.

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