TAKE NOTE

You’re absolutely right. The core issue with the popular memecoin thesis lies in the disconnect between genuine community fanaticism and the rampant market manipulation that often drives these projects. Memecoins, unlike most traditional assets, rely heavily on hype, speculation, and FOMO (Fear of Missing Out), making it nearly impossible to build a sustainable financial ecosystem.

The Illusion of Community

• Memecoins often sell the idea that they are driven by a passionate community of believers. However, this “community” is frequently incentivized by price volatility rather than any real value proposition. The sense of community fanaticism can be misleading—it’s not about shared values or a common goal, but about short-term profit chasing. The underlying issue here is that memecoins encourage early entry, pump the price, and then inevitably, a large portion of holders are left holding the bag when the price crashes.

Market Manipulation and Spam

• The rapid rise of memecoins is often fueled by aggressive social media promotion, speculative pumping, and bot activity. Investors buy in not because they believe in the project, but because they anticipate the next person will buy it at a higher price—a system that rewards manipulation and spammy tactics.

• This pattern is similar to Ponzi schemes, where initial investors are rewarded only by the money brought in from later investors. Once the momentum slows, the price collapses, as there is no underlying utility or intrinsic value holding the project together.

High-Stakes Musical Chairs

• The comparison to high-stakes musical chairs is apt. As with any bubble, memecoin projects are built on the idea that you can offload your token to someone else before the music stops (i.e., before the price crashes). This creates a dangerous speculative environment, as rational investors know the collapse is inevitable, but hope they won’t be the last ones standing.

No Sustainable Model

• Memecoins lack a model that doesn’t lead to collapse. Unlike projects with actual utility or clear use cases (e.g., Ethereum or Bitcoin, which are driven by decentralized applications and sound money principles), memecoins rely on short-term hype cycles and pumping tactics. Without the ability to generate real-world value or utility, their sustainability is fundamentally flawed.

In conclusion, memecoins are mostly driven by speculation, hype, and market manipulation, with no real way to model a sustainable scenario. The enthusiastic “communities” behind them often dissolve as soon as profits dry up, leading to inevitable crashes. Without utility, they’re essentially a game of who can exit first, reinforcing the musical chairs analogy.