On July 13, when news spread that a would-be assassin had nearly killed Donald Trump at a rally in Butler, Pennsylvania, a trading frenzy began. Within an hour of the shooting, the price of TRUMP, a cryptocurrency inspired by the former president, had plummeted. jumped more than a thirdfrom $6.34 to $8.69. The memecoin was, in effect, an indicator of the upcoming US elections.
Dozens of political memecoins have been created over the past year; there are also coins modeled after high-profile politicians such as Joe Biden, Kamala Harris, Robert F. Kennedy Jr., and Alexandria Ocasio-Cortez. They share an iconography and naming convention: politicians are often represented by unflattering caricatures and their names are deliberately misspelled (instead of Joe Biden, it’s “Jeo Boden”), in tribute to a influential meme comic As of the 2010s.
Beyond financial speculation, currencies serve no purpose and promise no utility, but throughout the US presidential election campaign, their market performance has been correlated with the political fortunes of the individuals they represent.
Just as TRUMP’s price rose in the wake of the assassination attempt, an event that commentators had… foretold would boost her chances of re-election, the price of KAMA, the Harris-themed coin, more than triple after Joe Biden announced his withdrawal from the race, paving the way for the vice president to become the Democratic nominee. Likewise, on June 27, the day of Biden’s disastrous performance at the CNN debate, the BODEN price fell by half.
In the United States, the Commodity and Futures Trading Commission (CFTC), a financial regulator, has refused to allow Gambling platforms offer bets on election results. Under the laws of numerous states, it is also explicitly illegal for residents to place such bets. But buying political memecoins has become an indirect strategy that, due to the violent price swings typical of cryptocurrency markets, carries greater risk and potential reward. All in all, worth hundreds of millions of dollars Currently, millions of political memecoins change hands every day.
“Investing in a political memecoin is not an endorsement or a badge of support,” says Rennick Palley, founding partner at investment firm Stratos, whose hedge fund holds memecoins in its portfolio. “Most people see it as a fun way to bet on what’s going to happen. If you wanted to speculate on who’s going to win, memecoins are clearly the way to do it with maximum risk and maximum reward.”
The debate over whether election betting should be legalized in the United States It goes back decadesbut is currently being resolved in the US court system. In September, the CFTC A request was denied by Kalshi, a New York-based company that runs a betting market on the outcome of events, to allow customers to bet on which party would control both houses of Congress, which the regulator described as “contrary to the public interest.”