Binance co-founder Changpeng Zhao (CZ) has urged the cryptocurrency industry to focus on real blockchain applications, calling the meme coin trend “a little weird.”
His comments come as the meme coin market has seen a significant downturn. Its total market capitalization dropped to $120 billion, representing a 7.5% decrease in just 24 hours.
This decline aligns with the broader crypto market’s retracement, sparking fresh discussions within the crypto community about the state of meme coins and their place in the blockchain ecosystem.
Community Divided Over Meme Coins’ Role
In a tweet today, Binance’s CZ shared his concerns about meme coins, questioning the growing craze around them. “Meme coins are getting a little weird now,” he said.
Accordingly, he encouraged the industry to prioritize developing real blockchain solutions. His comments have been met with both support and criticism.
I am not against memes, but meme coins are getting "a little" weird now.
Let's build real applications using blockchain.
— CZ 🔶 BNB (@cz_binance) November 26, 2024
IncomeSharks, a platform known for market education, echoed Zhao’s sentiment, describing meme coins as having shifted from entertaining to “extremely weird and desperate.”
Meanwhile, analyst Willy Woo remarked on the evolution of blockchain applications, comparing the current trend of meme coins to early blockchain gambling use cases.
Others, such as Dark Crypto Larp, criticized Binance’s listing choices, alleging a focus on meme coins over utility-driven projects. Larp suggested that Binance could better steer the industry by prioritizing innovative applications.
This discourse emerged as Binance Futures launched perpetual contracts for two meme coins, 1000WHYUSDT and 1000CHEEMSUSDT, with high leverage options. Following the announcement, both tokens experienced sharp declines, with WHY dropping 30% and Cheems losing over 50% of its value.
Aggressive Promotions of Meme Coin Raise Concerns
Meme coin promotions by influencers have also come under scrutiny. A report from Coinwire highlighted that 76% of meme coins endorsed by cryptocurrency influencers have ultimately collapsed, with only 1% achieving significant growth. The report further detailed that most promoted meme coins experience a 70% decline within a week of endorsement.
Interestingly, the performance of promoted meme coins appears inversely related to the size of an influencer’s following. Influencers with over 200,000 followers typically see negative returns on their promotions, with average losses of 39% within a week and 89% within three months.
Conversely, smaller influencers with fewer than 50,000 followers have reported more favorable outcomes, including 25% positive returns in the first week and an eventual 141% increase over three months.
Regardless, influencers continue to profit from their meme coins promotions. According to the report, an average promotional tweet earns influencers $399 while reaching approximately 15,000 views.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
