Be Wary of the Customary Meme Coin Hype

[Pelican Press 0]

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Be Wary of the Customary Meme Coin Hype

The price of (BTC/USD) trended down on Tuesday morning after President Donald Trump and First Lady Melania Trump returned to the White House and launched their own cryptocurrency meme coins.

Bitcoin swung wildly before, during, and after Trump’s Monday inauguration, falling below $100,000 before touching an all-time high of around $109,000. The price settled between $103,000 and $104,000 Tuesday morning.

Trump has repeatedly expressed his pro-cryptocurrency stance, particularly during his latest Presidential campaign. While the President did not announce cryptocurrency-specific policy, he did launch a meme coin bearing his last name.

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The market capitalization of the newly minted Trump (TRUMP-USD) ballooned to more than $10 billion, with the token soaring from $10 to $70.

As of Tuesday morning, the coin’s price hovered between $30 and $40. Soon after the President introduced his meme token, First Lady Melania Trump launched her own meme coin.

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Like Trump’s token, the Melania (MELANIA-USD) meme coin shot up and swung rapidly in both directions, swinging as high as $13 from a starting point of $5. By Tuesday morning, Melania’s token had settled below the $5 mark.

Analysis

Both Donald and Melania Trump’s X posts acknowledged that their cryptocurrencies are meme coins. So, despite claims that the President’s coin is intended to celebrate “WINNING”, there’s certainly no guarantee that all Trump coin investors will be winners in the long term.

Conotoxia Ltd. analyst Grzegorz Drozdz warned about the dramatic price moves of meme cryptocurrencies such as those released by the President and First Lady.

“Meme cryptocurrencies, like these, are prone to large fluctuations and we generally consider them as speculative assets,” he said.

This does not mean retail investors should not buy these or other meme tokens. It is important, however, to acknowledge the heightened risks and size one’s portfolio positions accordingly.

Sure, these meme cryptocurrencies could gain value if Trump enacts crypto-favorable policies, and the Bitcoin price could rise, as well.

It is also possible, however, that the crypto market’s high expectations have already been priced into these assets. Consequently, for Bitcoin and especially for newer meme coins, volatility may persist for a while, and it is wise to choose prudence over haste.

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#Wary #Customary #Meme #Coin #Hype

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