Trumps Impact on the Market
Donald Trump is predicted to have a more significant impact on the crypto market than Kamala Harris, however, the influence on the meme coin segment is still up for debate.
Columbia Business School professor Omid Malekan believes that Trump’s victory in the election could have a negative effect on the meme coin sector. He explained that investor interest in meme coins has grown due to the disappointment in the tokenomics of venture-backed projects. If Trump becomes president, the Republican Party may alter certain rules that will allow token holders to benefit from dividends and fees, resulting in reduced interest in meme coins.
Meme coins have emerged as a response to the strict policies of the U.S. Securities and Exchange Commission (SEC), so any relaxation in these policies in the event of a Republican win with Donald Trump at the helm would lead to a decline, according to Nic Carter, co-founder and general partner of Castle Island Ventures.
Malekan’s statements were echoed by Carter, who stated that a change in the SEC’s position would decrease the demand for meme coins, although speculative interests would still linger.
The opinions within the crypto community vary. Murad, a blogger and influencer, believes that the growth of meme coins is more due to economic factors rather than political ones, and the election results are unlikely to have a significant impact on this sector. Another well-known blogger, Jordan Fish, also disagrees with Malekan and Carter, emphasizing that the interest of ordinary traders in meme coins remains high since they cannot participate in large projects in the early stages.
The meme coin sector has become the fastest-growing sector in the crypto industry in 2024, rising by more than 1800% since the beginning of the year. Meme coins associated with Donald Trump have seen a significant increase in volume and price leading up to the U.S. election.
These coins hold a relatively small market capitalization compared to the entire meme coin market, with only four of them having a capitalization above $100 million. However, they have attracted the attention of the crypto community.
Forrest Przybysz, a trader and CEO of Sistine Research, suggests that the popularity of meme coins is based on attention cycles, and the more attention they receive, the higher their value will be. Yan Liberman, co-founder at crypto research firm Delphi Digital, emphasized that meme coins act as collectibles, allowing for the monetization of public attention.
Regardless of the impact of the U.S. presidential elections on the crypto market, it is clear that the market will face volatility. The question of meme coins also remains open, as they are unlikely to have any practical utility or strategic importance for the development of the decentralized finance market.
