Crypto Experts Debate Memecoin Prospects Amid Absence of Expected Bitcoin Bull Run
Summary:
The approval of multiple spot Bitcoin exchange-traded funds (ETFs) in the United States hasn't sparked the expected crypto bull run. Experts hold varied views on whether memecoin markets stand to gain in the event of a Bitcoin price surge. While some believe that potential capital influx from a spot Bitcoin ETF isn't enough to trigger a memecoin rush, others predict a potential golden era for memecoins, due to increased crypto interest. However, caution is advised around increased scam activities. The ETFs are anticipated to drive mainstream cryptocurrency acceptance, potentially benefiting the decentralized finance realm, with memecoins playing a significant role.
While the approval of multiple spot Bitcoin exchange-traded funds (ETFs) in the U.S. has been met with enthusiastic support from the market, the anticipated crypto boom has not yet taken place. The question now arising is whether the market for memecoins—which typically follow Bitcoin's lead—will profit if Bitcoin's price skyrockets, a prospect on which experts remain divided. The broader market, now teeming with more projects, L1s, L2s and memecoins than ever before is substantially larger. Significantly, Web3Auth announced on Dec. 22, 2023, that around 5,000 memecoins had been issued on Solana that very day.
Jupiter Zheng from investment firm HashKey Capital posits that the influx of capital from a spot Bitcoin ETF isn't enough to trigger a rush on memecoins. He believes that their real value lies within their communities. However, in the event of a possible surge in memecoin interest, the industry should gear up for it. Any new pressures—like increased network use, more capital inflows or additional coins—will be a test for blockchain networks.
On the other hand, Chen Arad from Web3 security firm Solidus Labs expects a potential gold rush for memecoins, facilitated by increased interest in crypto due to the ETFs. While creating ample opportunities for investors, Arad cautions about the potential increase in scam activities that could follow in the gold rush's wake.
Paps, the pseudonymous CEO of Avalanche memecoin Husky Avax, adds an optimistic voice to the conversation. ETFs, he says, will drive the widespread acceptance of cryptocurrencies and blockchain. A radical image makeover for these assets, courtesy of ETFs, could also place Ethereum and AVAX in the spot Bitcoin currently occupies, according to Paps. Consequently, decentralized finance could see a boost, with memecoins playing a significant role in the process.
Despite the largely hopeful outlook, Paps also reminds that memecoin investments can take place independent of Bitcoin or Ethereum. Following the approval of the first spot Bitcoin ETFs by the SEC on Jan. 10, Bitcoin's price saw a jump of 8%, which despite not being the dramatic rise some had anticipated, indicates a healthy performance. Experts acknowledge that with a potential bull market comes challenges, but these could be more favourable than those presented by a bear market.
Published At
2/6/2024 5:01:00 PM
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