If Donald Trump wins the upcoming presidential election, it could be bad news for the booming memecoin market, according to Omid Malekan, a finance professor at Columbia Business School.
In a post on X, Malekan argued that memecoins, digital tokens that often gain value through internet culture rather than utility could struggle under a Trump administration due to his push for regulatory “sanity.”
“Memecoins themselves are a form of economic populism,” Malekan claimed. “They are a statement against the unfair (and often grifty) tokenomics of VC-backed and insider coins.” This approach, he believes, is at odds with the more traditional and utility-focused regulatory approach he predicts Trump would bring.
Malekan also highlighted that a Republican-controlled government could lead to a resurgence in initial coin offerings (ICOs) and open token airdrops, similar to the crypto environment before venture capital-backed tokens were more tightly regulated.
He attributes this shift to pressure from figures like Senator Elizabeth Warren and SEC Chair Gary Gensler, whose stance on cryptocurrency regulation has led to more restrictive policies on token offerings.
Castle Island Venturas partner Nic Carter supported Malekan’s view, adding that “memecoins are largely a reaction to an oppressive SEC regime.” According to Carter, if the SEC under a Trump administration adopts a more lenient approach, retail traders might feel less compelled to trade memecoins.
The current memecoin market is sizable, with a combined market capitalization of around $61 billion, according to CoinGecko data. Yet the broader crypto community is divided on whether a Trump win would impact memecoins.
Memecoin advocate Murad Mahmudov disagreed with Malekan’s view, saying that “99% of memecoin buyers couldn’t care less about politics.” Instead, Mahmudov believes the rise of memecoins is linked to a “persistently rising global money supply” rather than regulatory concerns, suggesting this trend will continue regardless of who is president.
Crypto analyst Jordan Fish, known as “Cobie” in the crypto community, echoed this sentiment. He believes that memecoins are popular simply because of their rapid price volatility, which offers an opportunity for quick gains. Fish argued that “it is (almost) impossible for a normal person to buy a non-memecoin ‘early’ anymore,” making memecoins more appealing for those looking to enter the crypto space quickly.
Trump’s campaign has made general statements about cryptocurrency, with promises to make America the “world capital of crypto and Bitcoin” and bring all remaining Bitcoin mining to the U.S. According to a Coinbase poll, these pro-crypto promises could help Trump attract crypto-savvy voters in key swing states like Arizona, Michigan, Nevada, Pennsylvania, and Wisconsin.
The poll revealed that two out of three crypto owners in these states were likely to vote for a candidate supportive of the crypto industry, though support for Trump and Democratic candidate Kamala Harris was nearly split.
With just over a week until Election Day, the race between Trump and Harris remains extremely close. According to recent 538 polls, Harris holds a slight lead of 1.5 percentage points over Trump.
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