Recent reports have highlighted a split in the cryptocurrency community in response to the surge of memecoins. While some are celebrating the market’s growth, others view it as a step backwards. Memecoins experienced a substantial growth in July, reaching a market cap of $72 billion, a 29% increase from $55 billion at the end of June.
Several factors contributed to this rally, including presale excitement around memecoins, community momentum, and a new memecoin launchpad gaining traction on the Solana platform. By Friday, the memecoin market cap had peaked at $79 billion, marking a 43% increase from its value at June’s end. At the time of this writing, the market cap had slightly decreased to $78.81 billion.
The impressive figures have retail investors excited, but industry leaders are split on what this resurgence of memecoins means for the wider crypto ecosystem. Anthony Anzalone, the CEO and founder of layer-1 blockchain network Xion, views the memecoin craze as a symptom of larger issues in the crypto space.
Anzalone argues that memecoins harm the reputation of the cryptocurrency industry. He believes that the market cap surge does not reflect the realization of practical crypto use cases for everyday people.
He sees a negative correlation between the success of the industry and the memecoin sector’s market cap, stating, “If anything, I see an inverse correlation between the success of this industry and the memecoin market cap because it reads that capital doesn’t have anywhere better to flow.”
On the other hand, the anonymous community lead of the Neiro memecoin, known as S, defends memecoins, arguing that they are still the most attractive sector in the crypto space. S believes that memecoin projects are showing signs of maturing and cites Pudgy Penguins, Floki, and Neiro as examples of projects “building new technology.”
S describes memecoins as “hot, marketable and easy to understand,” contrasting them with the “convoluted, VC-driven tokenomics projects” that dominate cryptocurrency.
Petr Kozyakov, the co-founder and CEO of Mercuryo, emphasizes that sentiment remains a key driver in crypto markets. He attributes the memecoin surge to factors like the recent PUMP initial coin offering, which sold $500 million in minutes, memecoin accessibility to retail markets, and Bitcoin reaching a new all-time high.
Kozyakov acknowledges that despite differing opinions on memecoins, they have become a part of crypto culture. He concludes, “Whatever your view on these tokens, they have succeeded in gaining an army of loyal followers who greatly value participating in their journey.”
