Trumps Impact on the Market A Prominent Influence Continues

Many analysts are of the opinion that Donald Trump will have a more positive impact on the cryptocurrency market compared to Kamala Harris. However, the effect on the meme coin sector is still a matter of debate.
Columbia Business School professor Omid Malekan stated that Trump’s election victory could have a negative impact on the meme coin industry. The professor pointed out that the interest of investors in meme coins has risen due to dissatisfaction with the tokenomics of venture-backed projects. If Trump becomes president, the Republican Party may alter certain rules to allow token holders to receive dividends and fees, which could decrease the appeal of meme coins.
Meme coins as a response to SEC policies
Meme coins have become a reaction to the stringent policies of the U.S. Securities and Exchange Commission (SEC), and their relaxation in the event of a Republican victory with Donald Trump at the helm could lead to a decline, according to Nic Carter, the co-founder and general partner of Castle Island Ventures.
This was his reaction to the statement made by Columbia Business School professor Omid Malekan. In his statement, Malekan called on the Solana project community to support the Democrats, who are represented in the presidential election by Kamala Harris.
The analyst supported his argument as follows:
Meme coins symbolize economic populism and a protest against traditional crypto assets and the engagement of venture investors.
Institutionalized projects are evolving in response to SEC Chairman Gary Gensler’s and Senator Elizabeth Warren’s restrictive policies.
A Republican victory could fortify the position of significant traditional crypto assets, bringing economic mechanisms to token holders who are not involved in meme coins.
Malekan emphasized that improved regulation of the crypto sphere in the U.S. would act as a “bearish” factor for meme coins. Carter seconded him, stating that if the SEC’s position changes, the demand for meme coins would diminish, but speculative interests would prevent them from disappearing completely.
Opinions from the crypto community
People have diverse reactions to these statements. Blogger and influencer Murad believes that the growth of meme coins is due to economic rather than political factors, and the election results are unlikely to significantly affect this sector.
Another well-known blogger, Jordan Fish, also known as Cobie, does not agree 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.
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Meme coins and the U.S. Election
The meme coin sector has become the fastest-growing sector in the crypto industry in 2024, increasing by over 1800% since the beginning of the year. Leading up to the U.S. election, meme coins linked to Donald Trump have experienced a significant surge in volume and price.
This category holds a small capitalization relative to the entire meme coin market. Coingecko estimated its size at $1.2 billion, which accounts for 2.4% of the entire market, with only four of them having a capitalization above $100 million. Nevertheless, they have managed to capture the attention of the crypto community.
Forrest Przybysz, a trader and CEO of Sistine Research, indicated 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, highlighted that meme coins function as collectibles, enabling the monetization of public attention.
Hence, if Trump’s election promises come to fruition, America will witness a new cryptocurrency boom. However, the future of meme coins remains uncertain, as they are unlikely to hold any practical utility or strategic significance for the development of the decentralized finance market.
In any case, the crypto market is likely to encounter volatility as the U.S. presidential elections approach. However, the nature of this volatility remains unclear.
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