Celebrity memecoins have emerged as the latest influencer-driven trend in the crypto world. High-profile figures like Caitlyn Jenner and Iggy Azalea have launched their own memecoins, fueling widespread interest and speculation. However, similar to previous bull cycles, many celebrity-linked projects are being accused of retail dumping and scamming amateur investors, highlighting an ongoing issue within the crypto market.
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Celebrities like Paris Hilton, Floyd Mayweather, and Jamie Fox promoted various tokens through initial coin offerings (ICOs) in the 2017 bull run. Most of these ICO projects turned out to be failures, with one study suggesting that over 80% were scams. Despite this, many celebrities faced minimal consequences, often escaping with just fines for promoting fraudulent projects.
Rise of memecoins in 2024
In the 2021-2022 bull season, non-fungible tokens (NFTs) and the metaverse were the latest craze. Celebrities such as Jake Paul, DJ Khaled, and Floyd Mayweather promoted scam NFT projects, and even former President Donald Trump faced accusations related to NFTs of dubious value.
The current trend in 2024 is memecoins, many of which were initially created by random internet influencers before gaining mainstream popularity. This trend includes comically misspelt celebrity meme tokens like Doland Tremp (TREMP) and Joe Boden (BODEN), which even got listed by centralized exchanges.
By late May, celebrities including Iggy Azalea, Caitlyn Jenner, rapper Lil Pump, and online influencers like Andrew Tate had joined the memecoin frenzy. However, the involvement of such influencers often signals a market peak, as evidenced by the recent decline in memecoin volumes and prices.
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Data from CryptoQuant shows a steep decline in memecoin’s dominance in the altcoin market since mid-May. Tristan Frizza, the co-founder of Solana-based decentralized exchange Zeta Markets, emphasized memecoins’ volatility, noting that celebrity endorsements do not alter their high failure rate.
The frenzy began with Caitlyn Jenner’s (JENNER) memecoin, which quickly reached a $40 million market cap despite initial skepticism. Following this, Iggy Azalea launched her Mother Iggy (MOTHER) meme coin on the Solana blockchain, but its value has since plummeted. Other celebrities like Nigerian musician Davido and rapper Rich the Kid have also seen their memecoins lose significant value shortly after launch.
Scams and social media manipulation
A recurring figure in these celebrity memecoin launches is Instagram influencer Sahil Arora, who was accused of orchestrating and promoting these tokens, often without the celebrities’ full knowledge. Arora’s alleged strategy involved launching tokens, convincing celebrities to promote them, and then dumping his holdings, causing prices to crash. His account was eventually suspended after multiple accusations.
Max Jones, the co-founder of Solana-based memecoin launchpad MemePad, highlighted the importance of professional launchpads and sustainable economic models for celebrity tokens. He noted that poorly executed projects harm the overall crypto ecosystem.
A market this dependent on hype can’t last forever:
This hyped market will likely face a downtrend in activity; we already see a decline in 24-hour trading volume from over $100 million last week to $38 million. Many projects will be abandoned.
Max Jone
He added that if millions of fans interact with a low-quality project or a scam, it can turn people away from the token or crypto.
The broader impact on crypto
Recently, Ronaldinho announced a strategic partnership with Lingo, a platform that aims to merge the utility of reward tokens with real-world assets through blockchain technology. The collaboration, revealed via X (formerly Twitter), positions Ronaldinho as a pivotal ambassador for Lingo, aiming to leverage his celebrity status to introduce a broader demographic to the nuances of digital assets.
Celebrity influence in crypto has been a constant, but the memecoin trend has amplified the risks of scams and volatility. Ethereum co-founder Vitalik Buterin criticized celebrity memecoins for lacking substance and societal value, contrasting them with more purpose-driven projects like Ashton Kutcher and Mila Kunis’ Stoner Cats.
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Analyst Edward Wilson from Nansen pointed out that while some memecoins can be fun and culturally significant, the recent trend of low-effort celebrity projects has received significant backlash from the crypto community.
While celebrity tokens offer fans a way to engage with their idols, the prevalence of scams and extreme price volatility pose significant risks, potentially deterring new investors from the crypto market.
Cryptopolitan reporting by Florence Muchai
