What are PolitiFi Memecoins?
If the last memecoin bull cycle was all about dogs, this cycle seems to have found a mascot in the form of politicians. Once deemed a non-topic in political circles, crypto has now taken a frontline position (in the US at least), with a new breed of memecoins termed as “PolitiFi” memecoins. What is it and which are the tokens frontlining the hype?
What are PolitiFi memecoins?
Political Finance (PolitiFi) memecoins are a category of cryptocurrencies created at the intersection of politics, finance, and crypto. These tokens are typically named after political figures, although they have no official affiliation with any of the politicians they reference (as of now, at least!)
While the spirit behind the creation of these tokens is usually mockery, satire, or plain silly fun, the money cannot be more serious. Despite having a relatively smaller market capitalization compared to established meme coins like DOGE and SHIB, the top three memecoins (according to market cap) in CoinGecko’s PolitiFi category account for about 80% of the category’s total market cap of $1.58 billion.
Memecoins of the 2024 US Presidential Election
At the fore of the PolitiFi memecoin hype are none other than TRUMP, referencing Donald Trump, and BODEN, referencing Joe Biden. Both men are seeking reelection in this year’s US Presidential Elections, with Trump seeking to run for the Republican and Biden for the Democrats.
(Breaking: With Trump’s hush money conviction, it is unclear if he will still be running, but he is not legally prohibited from doing so.)
TRUMP is the ticker symbol for the memecoin MAGA (representing Trump’s “Make America Great Again” slogan). Launched on the Ethereum blockchain in August 2023 by pseudonym creators, it is arguably the first-ever political memecoin and self-describes as the only active cryptocurrency that donates to U.S. veterans and child protection.
TRUMP rocketed in value from $0.37 in January 2024 to an all-time high of over $15 in May 2024. (This is not to be confused with another separate MAGA token which is also hitching on to the Elections bandwagon, trading at $0.00038.)
BODEN, on the other hand, launched on Solana recently and reached an ATH of $1.07 on April 9, with a market cap of around $200 million at time of writing (ironically, the Democrats raised only $51 million for the reelection campaign by April, according to AP News.) The creators of BODEN also made a Donald Trump meme coin, Doland Tremp (TREMP). The token has also attracted interest but not to the extremes of BODEN.
As with most memecoins, these were created in part to satirize their namesake. The other part, obviously, is to capitalize on the upcoming presidential elections to be held in November later this year. After all, money is made wherever the attention is.
The political debates and increasing media attention around the election are expected to drive further volatility and growth in these memecoins. This reflects the growing interweaving of politics and cryptocurrency, with the candidates taking contrasting stances on crypto regulation.
“I will keep Elizabeth Warren and her goons away from your Bitcoin”
Some are of the view that the relative price movements and market caps of BODEN and TRUMP serve as barometers of the evolving public sentiment towards Biden and Trump, especially among crypto investors.
In a dramatic change of position, Trump has positioned himself as a pro-crypto candidate, with his campaign announcing that it would accept crypto donations, including BTC, ETH, DOGE and SHIB on May 21.
This announcement came on the heels of comments he made at a Libertarian National Convention, during which he said, “I will keep Elizabeth Warren and her goons away from your Bitcoin,” and “If you’re in favor of crypto, you’d better vote for Trump”. His speech hit fever pitch when he pledged to pardon Bitcoin pioneer Ross Ulbricht, who is currently serving out a life sentence for creating the e-commerce website Silk Road which accepted bitcoins.
Naturally, the $TRUMP (MAGA) memecoin surged on this news, hitting an all-time high (ATH) of $15.44 on May 29. This led to the appreciation of Trump’s crypto holdings to over $10 million briefly, according to blockchain intelligence firm Arkham, which also stated that Trump currently holds 579,290 TRUMP tokens, equivalent to approximately $8.56 million.
Again, the TRUMP tokens are not officially affiliated with Trump himself, but when Trump’s crypto wallet address became publicly tagged on August 16, 2023, his wallet was sent TRUMP tokens in multiple tranches.
(This is a common practice in the crypto world, where the founders or creators send tokens to publicly known wallets of celebrities or high-profile individuals to drum up publicity for the tokens. This was how Ethereum co-founder Vitalik Buterin received SHIB in 2021, which he then donated to charity.)
Since its launch, TRUMP has risen by over 60,000%, and its market cap has soared to over $588 million as of May 2024, based on CoinMarketCap data. At time of writing, TRUMP is trading at $13.50.
But this is not the first time Trump has dabbled in crypto. According to financial disclosures, Trump reported making $100,000 to $1 million in 2022 from his NFTs, which enable buyers to VIP meet-and-greet sessions with him.
Other political memecoins like PEOPLE (ConstitutionDAO) have also seen huge gains, reflecting the growing influence of politics in the crypto space. ConstitutionDAO was established in 2021 to crowdsource the purchase of a copy of the US Constitution at a Sotheby’s auction. AssangeDAO (JUSTICE) and FreeRossDAO ($FREE), which were created to campaign for the release of freedom journalist Julian Assange and the above-mentioned Ross Ulbricht respectively, are also seeing significant price action.
On the other hand, the Biden administration has taken a hostile stance towards crypto, with figures like Senator Elizabeth Warren criticizing the industry. Interestingly enough, it seems like not all Democrats are firmly anti-crypto. In the SEC’s proposal of a new accounting policy which will make it difficult for banks to custody Bitcoin and other cryptocurrencies for clients, some Democrats broke rank and voted against it, joining their Republican counterparts. It may be too early to say the tides are shifting in favor of crypto, but this development is nothing short of noteworthy and optimistic for the industry in general.
In conclusion
The rise of PolitiFi memecoins highlights the growing intersection between cryptocurrency and popular culture, with these tokens often attracting attention and speculation due to their meme status rather than intrinsic value or utility. Before brushing these memecoins off as nothing more than a cash grab by pseudonymous entrepreneurs, however, here’s some food for thought. Given the market caps some of these coins have achieved, who’s to say that memecoins will not be the fundraising method of choice in the not-too-distant future?
