Article Sharing Test - Tens of Thousands of Meme Coins Flooding Daily… "97% Become Worthless"

The Two Faces of Meme Coins - (Part 2) Emerging as a New Fraud Tool

Global Market Cap of 15.3 Trillion Won '442% Surge'

Last Year's Trading Volume Grew 13 Times in a Year

Fake Versions Mimicking 'Official Trump' Appear

'Memes' Issued by Celebrities and Influencers

Plummeted in Minutes, Investigated for Fraud Allegations

User Protection Measures in Korea

'Regulatory Guidelines' Discussions Begin in Earnest

#1. On the 18th, U.S. President Donald Trump issued his meme coin 'Official Trump'. Two days later, his wife Melania Trump also released 'Official Melania Meme'. Within just a few days, 61 fake meme coins mimicking the Trumps' meme coins appeared.

#2. Last year, a developer who evoked sympathy by claiming to have "no arms" introduced the HANDS meme coin. This coin quickly attracted a large amount of investment, reaching a market cap of $550,000 at one point. The developer's claim was revealed to be false, and as he sold his share of the meme coins for profit, the coin's price plummeted, leaving investors to bear the losses.

Meme coins, which are sucking funds from the cryptocurrency market, have emerged as a new fraud tool. They cleverly exploit human speculative psychology aiming for a jackpot. There is even an analysis that 97% of meme coins that have appeared in the real world have become worthless.

○ Stirring Speculative Psychology

According to CoinMarketCap on the 23rd, the market cap of meme coins listed on global cryptocurrency exchanges was tallied at 15.258 trillion won as of 9 a.m. that day. Compared to January 24 last year (2.813 trillion won), the market cap increased by 442.4% in one year. During the same period, the global meme coin trading volume (24-hour basis) grew from 2 trillion won to 27 trillion won.

Meme coins listed on cryptocurrency exchanges have at least passed listing standards such as public support at each exchange. However, according to Binance, the world's largest cryptocurrency exchange, 97% of meme coins issued as of November last year showed a trading volume of '0'. Since meme coins can be issued with just an idea, tens of thousands are created daily. On the meme coin creation platform PumpFun, about 50,000 meme coins are generated in 24 hours.

Meme coins are created inspired by popular humor, jokes, or images on the internet, so they have no intrinsic value. They differ from other cryptocurrencies that try to gain public trust by disclosing clear developers, technical capabilities, and future utilization plans. Due to the lack of value, their price volatility is also very high.

○ Meme Coins Enter a New Phase

Cases of meme coins being used as fraud tools are also continuing. American influencer Hailey Welch created the meme coin 'HAWK' based on her popularity, but its price plummeted by 91% within 3 hours of launch, leading to an investigation for insider trading allegations. Jamaican-American singer Sean Kingston launched the meme coin 'KING'. Its market cap reached $4 million immediately after launch, but it dropped to $400,000, a tenth, within minutes. There is also an analysis that one out of six meme coins is a blatant scam coin targeting investors' money.

There are also observations that the launch of meme coins by the Trumps has opened a new phase for meme coins. First, there is a prospect that the U.S. Securities and Exchange Commission (SEC) regulations will be strengthened. Virtual asset expert Andy Lian diagnosed, "The launch of the President's meme coin has blurred the boundaries between entertainment, politics, and finance," and "The SEC is now in a situation where it has to choose whether to strengthen regulations further or to prepare clearer guidelines to adapt to reality."

○ Moves to Strengthen Regulations in Korea

There are signs that meme coin regulations will be strengthened in Korea as well. The Financial Services Commission announced that it would specify listing requirements for poor-quality coins like meme coins. These requirements consist of △the reliability of the issuer △user protection measures △technology and security △compliance with laws, focusing on verifying undisclosed digital assets and the issuer's wallet information. A Financial Services Commission official explained, "Whether to utilize existing regulations or introduce meme coin-specific guidelines will be discussed later."

Jin Jeong-ui/Jo Mi-hyeon Reporter justjin@hankyung.com