Coinbase Highlights Potential Profits and Risks of Meme Coins in Short-Term Investments.
In its recent newsletter, Coinbase (COIN) drew attention to the increasing popularity of pepecoin (PEPE) and meme coins based on Bitcoin.
Following a notable decline in the cryptocurrency market, traders are now seeking opportunities for profit by shifting their focus towards humorous tokens instead of traditional investment strategies. This trend has led to considerably high transaction fees, known as gas fees, on the Ethereum blockchain.
According to Coinbase’s recent newsletter, the trading volume of meme coins surged to $2.3 billion last week, which was over six times greater than the previous week. This marked the highest level since May 2021.
Coinbase’s newsletter highlighted the current frenzy around meme coins, particularly the remarkable growth of PEPE. Since its launch in mid-April, PEPE has surged by nearly 55,000%, reaching a market capitalization of $1.8 billion in less than three weeks. This rapid growth positions PEPE as one of the fastest-growing tokens in history.
The newsletter also observed the increase in Bitcoin-based meme coins, which gained traction after the introduction of the ‘Bitcoin Request for Comment’ (BRC-20) token standard. This standard enables developers to create tokens directly on the Bitcoin blockchain, contributing to the growth of meme coins based on Bitcoin.
However, the majority of these tokens ended up being meme coins and collectively reached a market capitalization of $1.8 billion earlier this week.
The Pepe meme’s utilization by various political groups.
However, the newsletter upset some members of the Crypto Twitter community as it highlighted a connection between the original Pepe the Frog meme and political groups that may not be widely known.
“The token is created based on the Pepe the Frog meme, which originated as a comic-strip character on the internet almost 20 years ago,” stated the Coinbase newsletter. “However, it has been misused as a symbol of hate by certain alt-right groups, as reported by the Anti-Defamation League.”
Despite the newsletter’s disclaimer, stating that the views expressed do not necessarily represent those of Coinbase or its employees, the highlighted sentence became the main focus of discussion on Crypto Twitter.
COINBASE VS PEPE ARMY pic.twitter.com/qHEY3Q7Wxa
— beeple (@beeple) May 11, 2023
The Pepe community expressed anger and frustration in response to the newsletter.
“One of the prominent PEPE supporters, @Pauly0x, tweeted, ‘$pepe is not a hate symbol!’.”
“I will be closing my personal and business accounts with @Coinbase and moving them to @Gemini. #PEPE IS NOT A SYMBOL OF HATE,” tweeted @OG_Kenobi_Hello, another PEPE supporter.
Another Twitter user, @OG_Kenobi_Hello, added, “The $pepe movement is all about love, fairness, and standing up against VC-backed entities and influencers who have been unfairly exploiting the web3 community for the past 2 years.”
On Thursday morning, the hashtag “#deletecoinbase” was trending on Twitter in Asian time zones.
