Yes, it's called Fatcoin. Yes, it's completely useless.
Despite this, its market cap has grown to over $800 million over the past week. That's roughly the market capitalization of the parent company of Office Depot, Guess Jeanswear, and Steak N' Shake.
In the day since this article was published, Fartcoin's value has fluctuated. It started at about $620 million (7 a.m. Sunday), rose to a high of $889 million, and settled at $836 million by 9:35 p.m. ET.
The Carnival Casino era of cryptocurrencies is back with a vengeance, riding a wave of widespread investment in Bitcoin spurred by the election of President Donald Trump. Everyone seems to be in on the joke, even the losers, while minting millionaires, despite the potential harm to others.
Tor Bautista, a research analyst at decentralized finance group GSR, said the wave of “meme coiners” includes both long-time Bitcoin holders and people who simply want to change their fortunes in an era of rising housing and stock prices. It is said that they are mixed. While many meme-coin traders are flush with profits thanks to Bitcoin's 130% rise this year (50% of which has been since Trump's election last month), they have fallen into the realm of pure speculation. It's just moving “down the risk curve,” Bautista said. Some people see the potential to make 10x more money overnight.
“A lot of it is that people think, 'I'm going to have some sort of advantage by increasing my chances of winning the lottery,'” Bautista said.
According to Bautista, memecoin buyers and sellers alike are mostly aware that their trading activities amount to the most dangerous type of gambling. It's all about letting go of your position so you don't end up “holding the bag” or failing to trade up or strike while prices are high.
“They have no value, so you're betting on the 'bigger fool,'” he said, referring to the idea that someone else will pay a higher price for a particular meme coin. “You're thinking, 'It's too early for me, someone will buy the bag.'” But there's no underlying driver of value. ”
In most cases, the biggest risk in trading meme coins tends to be based on the longevity of viral internet memes, with the meme itself disappearing from the cultural zeitgeist. And indeed, for a very select few, the benefits from any given news cycle can be substantial. Blockchain data shows at least one owner of a coin created in the wake of last month's Peanuts the Squirrel incident, which involved the death of a rodent that a New York man may have kept without permission, has , was found to hold nearly $500 million.
Now, with that news story out of sight, that coin, PNUT, has fallen by about half from its all-time high of $2.47.
However, meme coins also have operational risks. That's evidenced by the rise and rapid fall of the “Hawk” coin released earlier this month by Haley Welch, the Tennessee woman who turned a salacious street interview that went viral into a successful podcast.
In the span of 24 hours, Hawk's market capitalization peaked at $500 million before plummeting to $28 million, sparking complaints of a dramatic loss of funds. These complaints have not been independently verified by NBC News.
In the face of insider trading accusations, Welch issued a statement saying that neither she nor anyone on her team had sold any coins, and that she was “sniping” at algorithmic bots designed to sell when prices started to spike. accused of doing so.
Indeed, Bautista said that algorithmic trading, which has long been part of mainstream trading on Wall Street, is now routinely implemented in the memecoin space. He estimates that half of the top 20 traded cryptocurrencies are meme coins, and that trading is done almost entirely by bots designed to spot and react to price movements. I am doing it.
Is it legal? Some believe meme coins are allowed because the Securities and Exchange Commission has never formally classified Bitcoin as a security. However, authorities took action against exchanges that allowed trading of other tokens. And importantly, it appears that many meme coins, including Fatcoin, cannot be legally purchased from the continental United States on most of the crypto exchanges that offer them.
Ground zero for launching meme coins is a website called Pump.fun, which allows users to “launch coins for free and instantly tradeable in one click.” The site was launched in January 2024 and has generated more than $288.4 million in revenue since its launch, according to analytical data cited by crypto industry publication Cointelegraph.
Earlier this month, Britain's Financial Conduct Authority said the website was not authorized in the country and warned there was no investor protection for anyone using products or services linked to the site.
Nevertheless, the site's terms of use state that its provisions are governed by “English law”.
A spokesperson for the website could not be reached for comment.
It may be the digital wild west, but some tools have been developed to help uninformed memecoin participants avoid outright fraud. A site called Rugcheck.xyz advertises that it can scan memecoin ownership data to determine whether an attacker or a small group of attackers can gauge the size of the market. Pump.fun itself prevents “lag”, or sudden price drops, by ensuring that the tokens it issues do not include pre-sales or small allocations that benefit insiders. It says that there is.
It's not clear how long the current crypto “bull” cycle will last, but at least one analyst believes that given the likely developments next year, namely the possibility of further interest rate cuts by the Federal Reserve, We believe this is at a relatively early stage. Implementation of more crypto-friendly policies by the Trump administration.
“There are a lot of things that could happen in 2025 that could push the price of Bitcoin and cryptocurrencies even higher,” Gracie Chen, CEO of crypto group Bitget, said in an interview with NBC News.
Indeed, there are already signs of accelerating the adoption of cryptocurrencies in Trump's world. Bloomberg News reported Friday that World Liberty Financial, a “President Trump-inspired” cryptocurrency project, is buying millions of dollars worth of tokens beyond Bitcoin, making it a decentralized financial This indicates that the lending platform may be launched soon. President Trump has been named the ultimate “economic beneficiary” of world freedom.
A World Liberty spokesperson did not respond to a request for comment.
However, there is a decidedly darker side to the world of meme coins. Omid Malekan, who teaches cryptocurrencies at Columbia University's Columbia Business School, believes cryptocurrencies are a sign of the economic “nihilism” that has taken root among many young Americans who feel their American dream has been sacrificed. He said that it is a symbol of “.
“All the kids are saying, 'All the good stocks are too expensive.' And what about houses? We can't afford them,” Malekan said. “So I said, 'I'm going to bet on something that will make my money '10x,' and if I lose it all, I don't care. I was screwed anyway.” ””
