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Author: Zoltan Vardai, CoinTelegraph; Compilation: Baishui, Bitchain Vision
Meme coins were once seen as a community-driven digital asset, but are now increasingly used to exploit retail investors, and the increasing number of scams and celebrity-backed token failures have sparked regulatory concerns.
The Libra (LIBRA) token collapsed with a market cap of $4 billion, the latest hit to the industry after eight internal wallets cashed out $107 million in liquidity, causing its price to drop 94% within hours of launch.
Anastasija Plotnikova, co-founder and CEO of blockchain regulatory firm Fideum, saidThe rise of scams related to memecoin has brought significant regulatory challenges.
Plotnikova points out:“Memecoins has evolved from a community-driven social experiment to a chaotic situation dominated by retail investors’ extraction of value”, adding:
“Internal circles, stock price gouging and sniper teams have replaced the organicity and collectivity of the original memecoin, creating an unhealthy competitive environment.”
Investors also need to distinguish between memecoin, which can be regarded as a true “collection” and “outright fraudulent activity” such as a carpet tug-of-war, which “is not only immoral, but also obviously illegal, with case law supporting law enforcement.”
“In my opinion, these activities should fall entirely under the jurisdiction of law enforcement agencies,” she added.
More disturbing disclosures have emerged since the collapse of Milei-backed Libra tokens, especially as Libra is an “open secret” in the internal circle of memecoin, and some members of Jupiter’s decentralized exchange knew about the issuance of the token two weeks in advance.
Memecoin scandal is unlikely to affect U.S. cryptocurrency legislation
Zekret founder and chief technology officer Dmitrij Radin said that despite the recent memecoin crashes negatively impact investor sentiment, they may not have an impact on emerging cryptocurrency regulation in the long run.
He noted that this is because cryptocurrency legislation is formulated from a “long-term” perspective, not just based on recent events.
It is also important to understand that Libra’s appeal is different from the launch of the official Trump (TRUMP) and the official Melania Meme Coin (MELANIA), which is unlikely to trigger regulatory responses in the United States, Radin said, adding:
“The US cryptocurrency Tsar David Sacks mentioned,Meme coins are more like a collectible.Therefore, it should not be regulated as securities or something like that.”
“That’s why I believe the Trump and Melania tokens may be accepted in a different way than Libra,” he added.
