- In a recent interview, Hoskinson warned that 99% of Solana meme coins would fail, cautioning investors about their speculative nature and the risk of pump-and-dump schemes.
- The rise and fall of LIBRA, backed by Argentinian President Javier Milei, and the Gen Z Quant token have sparked concerns over market manipulation and insider trading.
Charles Hoskinson, the founder of Cardano, has raised concerns over the growing trend of meme coins, particularly those built on the Solana blockchain. In a discussion with market analyst Scott Melker, Hoskinson highlighted the fleeting nature of most meme coins, comparing their rise to the short-lived fame of a celebrity.
“A meme coin is just like the ascendancy of a celebrity that has 15 minutes of fame,” he explained. “It doesn’t necessarily mean the celebrity will disappear forever, but their popularity is temporary.”
He predicted that 99% of meme coins will fail, with only a few evolving into ecosystem-building projects. This concern is evident in the sharp decline of Solana’s top five memecoins,TRUMP, BONK, FARTCOIN, WIF, and PENGU which have lost over 85% of their market capitalization from a high of $81.83 billion. Their downturn suggests that speculative hype alone is insufficient for long-term value retention.
Hoskinson emphasized that real blockchain value stems from real-world assets, not speculation. He likened it to conservation laws in physics, asserting that for a blockchain ecosystem to thrive, it must attract external value and users, much like Bitcoin (BTC) and other real-world asset-backed systems.
Hoskinson’s Criticism of Solana’s Meme Culture
The founder pointed out that Solana has become the dominant blockchain for meme coins, likening its survival to that of a successful meme coin. He referenced Solana’s resilience after the FTX collapse in 2022 and the insider trading scandals involving Sam Bankman-Fried as an example of a network that managed to endure challenges.
“Solana has thrived on the other side, proving itself as the ultimate analogy for a network that managed to break free from the old paradigm. However, success isn’t just about escaping; there must be real utility. “You have to have something there,” Charles cautioned.
Despite its momentum, concerns linger over Solana’s deep ties to speculative meme coins, which could threaten its long-term stability. For example, Crypto News Flash reported that Pump.fun, a platform for launching Solana-based meme coins, faced a class-action lawsuit. The lawsuit alleged that the platform facilitated the unregistered sale of securities, specifically citing the PNUT token. According to the filing, Pump.fun had launched over 6.12 million tokens, many of which rapidly lost value, fueling fears of unchecked speculation within the Solana ecosystem.
Unlike earlier market cycles, where centralized exchanges were necessary to trade meme coins like Dogecoin and Shiba Inu, the rise of decentralized exchanges (DEXs) has made it easier than ever to create and trade meme coins. Hoskinson warned against this, stating, “This time, because of decentralization and DEXs, people figured out Web3. You can go on Pump. fun and launch fifteen of these things an hour if you want, make a little bit of money, and move on with your life, without caring about the pain you’ve left behind. So this time, we get five million meme coins a month instead of 500 in a cycle.”
Meanwhile, ADA, the ninth-largest cryptocurrency with a market capitalization of $23 billion, has rebounded with a 6.6% gain in the last 24 hours. This comes after a 9.3% decline over the past week, bringing its current trading price to $0.6797.
