Memecoin Mania Raises Concerns Amid Controversial Presales, with Millions in Solana Amassed
Summary:
The cryptocurrency world is facing an alarming trend known as "peak degeneracy," as memecoin creators amass millions in Solana (SOL) through token presales. Using a controversial model, cryptos like Book of Meme (BOME), $NAP (NAP), and Nostalgia (NOS) are raking in serious funds. An Ethereum educator criticized the model, warning against its propensity for fraud. Additionally, the memecoin frenzy has spilled into other spheres, with podcast co-host David Sacks contributing to the hype, leading to one user gaining approximately $39,000.
Cryptocurrency enthusiasts have begun sounding alarms over what they term as "extreme degeneracy," highlighting the practice of memecoin originators accumulating millions in Solana (SOL) via token presales in the past 72 hours. As of the moment, crypto investors have funneled approximately $100 million in Solana towards recent memecoin ventures, according to data combined by Cointelegraph and shared by researcher 0xGumshoe. This fundraising channel has seen controversial use for unreleased coins like Book of Meme (BOME), $NAP (NAP), Nostalgia (NOS), and more. One pseudonymous crypto investor called Nick posted about excessive financial speculation in memecoins, referring to it as the ultimate form of degeneracy.
The memecoin presale frenzy was set off by an entity named Book of Meme that used the contentious crowdfunding model. Originated on March 14 by a pseudonymous artist known as Darkfarms1 with an initial worth of approximately $4 million, BOME saw growth exceeding 36,000% resulting in a market cap of $1.45 billion in less than 56 hours. One early investor, a personal acquaintance of the creator, turned an initial investment of 420.69 Solana (valued at $72,000) into an astounding $32 million within 3 days, as reported by Lookonchain on March 17.
Crypto 'pre-sales' are structured such that crypto investors transfer cryptocurrency to a wallet address, expecting a proportionate distribution of tokens when the token goes live. There's no guarantee in this arrangement, making presales an ideal model for fraudulent and deceptive acts. Ethereum educator, Anthony Sassano, criticized this model, cautioning that anyone sending money to an arbitrary wallet address with the expectation of receiving a token was highly misguided.
Moreover, the memecoin frenzy has spilled beyond the confines of crypto X. A notable development surrounding David Sacks, the All In podcast co-host, saw one fortunate user reportedly gain around $39,000. When Sacks started discussing his memecoin on X, another All In memecoin was anticipated to appreciate as well. Consequently, as Elon Musk expressed interest in buying Jason Calcanis's coin in response to a tweet, the related JASON coin soared, multiplying an initial investment from 1 SOL into 200 SOL.
Published At
3/18/2024 8:36:00 AM
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