76% Of Memecoins Promoted By Crypto Influencers Are Scams!

Memecoins are known for their meteoric rise before sinking into oblivion. They attract traders in search of quick gains, but these investments are also synonymous with heavy losses. A recent study highlights a troubling phenomenon: on X, formerly Twitter, the majority of crypto influencers are promoting memecoins destined to fail. Focus on these risky practices and their disastrous consequences.

Memecoins: a poisoned Eldorado thanks to influencers

Since April, there have been a million new crypto tokens announcing the phenomenon of Memecoin Mania. However, not everything is rosy for this category of asset. The figures from the Coinwire study are unequivocal: 76% of crypto influencers on X have promoted memecoins that no longer exist today. Among them, only 1% recommended projects that multiplied their value by ten. The rest? Assets destined to collapse.

Why such a fiasco? Because many influencers prioritize immediate gains, to the detriment of naive investors. The memecoins they recommend see their value plummet by 70% within the first week, reaching a loss of 80% in one month and a total collapse in three months.

Some key figures on promoted memecoins:

• 80% lose 70% of their value in one week;
• 90% drop by 80% in one month;
• After three months, 86% have lost ten times their initial value.

Gen Z trader rugs meme coin during livestream, community's revenge sends token to $80M pic.twitter.com/VO9J1XdmqE

— Crypto Briefing (@Crypto_Briefing) November 20, 2024

Some investors, like this Gen Z trader who pocketed $30,000 during a rug pull, manage to profit from this volatility. But these are exceptions: the majority end up suffering heavy losses.

Crypto regulation: towards the end of influencer abuse?

In the face of these excesses, several regulators are trying to regulate the practices of influencers. Some are considering applying consumer protection laws to promotions on social media. But the challenge is colossal, because strategies evolve faster than regulations.

Influencers with large audiences, especially those with over 200,000 followers, turn out to be particularly harmful. According to the study, their promotions lead to 39% losses in one week and 89% in three months. In contrast, small influencers (fewer than 50,000 followers) offer much better returns, even achieving +141% after three months.

As Coinwire points out:

” Investors should beware of enticing promotions and examine the real value of projects. ” 

It remains to be seen whether laws will actually succeed in curbing this market where every tweet can ruin lives.

Thus, the memecoin crisis does not only affect ephemeral projects on Solana but extends to pillars like Dogecoin and Shiba Inu, already severely impacted. In this ruthless universe, caution remains the best weapon against the illusions sold by tempting tweets.