Cryptocurrencies were created as a new way to make payments, built atop an innovative ledger technology known as blockchain. After existing for a decade and a half, they have largely not achieved their goal of upending how money moves around the globe.
However, they have become a hot asset class for investors to stash money in and encompass a whole lot of territory beyond that well-known turf—and stir befuddlement for most everyone besides true believers in the digital assets. As they move closer to the mainstream, with major financial firms adopting them and a friendly administration taking control of the White House this month, outlining the differences among types of cryptocurrency can shed light on what makes them popular—and risky.
There’s Bitcoin, the one that started it all amid the carnage of the Great Recession. Even though it was forged to circumvent the conventional financial system, the biggest firms on Wall Street, smelling riches and spotting interest among young people, have begun embracing it. There’s Ethereum, which, in simplest terms, offers a cryptocurrency built atop a blockchain that serves as the underpinnings for something akin to a global supercomputer (a place where developers can deploy software known as smart contracts). There also are myriad crypto projects like Solana that aim to provide the industrial-grade infrastructure needed to move the conventional financial system into the blockchain era.
And then there are memecoins, the most ragtag of the bunch given the complete lack of economic utility and the colorful and often bizarre imagery attached to them. Even as Bitcoin trades at unprecedented levels above $100,000, memecoins have stolen the spotlight after President Donald Trump and first lady Melania Trump launched their own just before Inauguration Day, immediately augmenting their family’s wealth—at least on paper—by billions of dollars.
The memecoin ecosystem that the first couple entered with $TRUMP and $MELANIA is undeniably quirky. It’s rooted in internet memes, the viral images with funny text appended—like “distracted boyfriend,” the photo of a man gazing at an alluring woman while his girlfriend glares at him, or “this is fine,” the big-eyed cartoon dog sitting in a room surrounded by fire. The first memecoin was Dogecoin, launched in 2013. It was a joke, plain and simple, based on the popular “doge” meme featuring a Shiba Inu dog with broken English captions like “such wow.” It’s anything but a joke now. Elon Musk became enthralled; the Department of Government Efficiency he leads is known as DOGE, Dogecoin’s ticker symbol. All the Dogecoin in circulation are collectively worth more than $50 billion, larger than stalwart companies including Allstate, Nasdaq, and Marathon Petroleum.
The value of memecoins is invigorated by passionate supporters in search of community—you own the coin, so you’re part of a group of likeminded souls, possibly on a path to riches. These coins are further supported by you-only-live-once speculators trying to ride a wave of popularity to huge profits, and by a big dose of magical thinking that these tokens will be worth something because people want it to be so. The greater fool theory of investing, as it were.
It’s worked for Dogecoin, and also the $12 billion Shiba Inu coin (inspired by the same dog breed as Dogecoin), the $7 billion Pepe coin (whose mascot is a cartoon frog) and now the Trump coins: $TRUMP’s market value is around $7 billion and $MELANIA fetches about $500 million.
Owners of the Trump coins get nothing besides a highly speculative asset—no utility or economic value. But the Trump family has derived quite a lot of value from the new cryptocurrencies, on paper at least, by selling an initial batch to public investors via the Solana blockchain and by holding onto a large pile of suddenly valuable tokens that could be sold later.
Entities tied to the Trump Organization control 80 percent of $TRUMP’s total token supply. Trump could sell this stockpile of currently uncirculated tokens over time—slowly, to avoid cratering the price by dumping too much at once—and pocket a life-changing sum of money (assuming prices hold up). Anyone wishing to curry favor with the Trump administration could easily direct money to the president’s crypto wallet by buying up some of Trump’s hoard as it’s sold, or by purchasing so much from other public investors it lifts the value of all the tokens.
Because of the potential for conflicts of interest and a general distaste for memecoins among crypto purists, the Trumps’ memecoin gambit has rankled some of Trump’s fervent backers in the crypto community. The crypto industry spent big on Trump’s reelection campaign, helping push him back into the White House after he pledged to turn America into a crypto powerhouse.
Nic Carter, a prominent crypto figure and a Trump supporter, was turned off by $TRUMP and $MELANIA. “Creating a bunch of personal memecoins opens the door to secretive foreign buyers trying to curry influence with our leaders,” he posted on X. “If you hated [H]unter [B]iden’s anonymous art sales, you should hate this too. Basically, we used to have an informal rule that presidents wouldn’t start or run businesses that could pose a conflict of interest.”
Ryan Selkis, a crypto executive and active Trump booster on social media during the campaign, posted on X after the $MELANIA coin debuted and tanked the price of $TRUMP (seemingly as traders shifted money to the newest thing): “Please fire whoever recommended going forward with the Melania launch today. 1. They don’t know what they’re doing. 2. They cost you a lot of $ and goodwill. 3. They don’t have your interests in mind.”
Trump wasn’t always a fan of crypto. “Bitcoin, it just seems like a scam,” he said in 2021. “I don’t like it because it’s another currency competing against the dollar.” He did an about-face on the campaign trail in 2024, endorsing the idea of the U.S. government holding a strategic Bitcoin reserve while speaking at a Bitcoin conference in Nashville. He even paid for burgers with the cryptocurrency at a Bitcoin-themed bar in Manhattan. That won him a loyal following among crypto enthusiasts.
The crypto economy isn’t a monolith. Bitcoin’s most enthusiastic fans are appalled by the proliferation of thousands of other cryptocurrencies—with memecoins near the top of that list. (They believe the original crypto is the only one that’s needed.) At the same time Trump has embarked on a lucrative memecoin venture to bolster his personal wealth, his administration is likely to go a more conventional route by embracing crypto regulations (or lack thereof) that big industry interests have yearned for for years.
Trump was asked about the family memecoins during a January 21 press conference while standing beside fellow billionaires Sam Altman of OpenAI, Larry Ellison of Oracle, and Masayoshi Son of SoftBank. “I don’t know much about it other than I launched it. I heard it was very successful. I haven’t checked it. Where is it today?” A reporter told him the coins were worth billions of dollars. “Several billion? That’s peanuts for these guys,” referring to Altman, Ellison, and Son.
John Lothian, a veteran journalist and former futures and commodities trader, discussed the Trump memecoin escapade in his newsletter for financial professionals, noting the “obscene amount of money seemingly conjured out of thin air and the use of this sacred American event [Inauguration Day] for apparent personal gain.” But he went on to note that Inauguration Day has long been marked by the issuance of commemorative “coins, medallions, tokens, and medals” celebrating incoming presidents. Trump’s digital version fits within that history, even if the use of cryptocurrencies is unprecedented.
“The move symbolizes how commemorative practices adapt to changing times, embracing digital innovation while maintaining the spirit of celebration and historical acknowledgment,” Lothian wrote. “That does not mean there isn’t some grifting going on, but it has a very good cover story.”
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