Brian Armstrong: Memecoins Are a “Canary in the Coal Mine”
Coinbase CEO Brian Armstrong recently shared his take on the memecoin sector in an X post. Armstrong said he decided to speak on the topic as memecoins have generated a lot of buzz, and he’s been getting questions about how he approaches them.
Memecoins aren’t having their best time. According to CoinMarketCap, in the last 30 days, the sector’s market cap fell by around 42%, while trading volume is down by 93%.
These stats suggest that people are getting more cautious about memecoins, and there are reasons for that.
The TRUMP memecoin, launched by the U.S. president ahead of his inauguration, is now 77.6% down from its all-time high of $75.35, causing large losses to investors. The LIBRA memecoin, posted by Argentinian president Javier Milei on his X account, has caused a large scandal, starting an investigation against him as the token fell.
Related: Coffezilla Exposes LIBRA Founder’s Token Sniping Confession
What Does Brian Armstrong Think About Memecoins
In his post on memecoins, Armstrong shared his thoughts on the risks and possibilities of their future. He clarified that he’s not a memecoin trader, except for a few test trades, while adding that memecoins have become hugely popular.
Looking back at the market, the Coinbase CEO noted that memecoins have been a part of the industry since the beginning. Dogecoin (DOGE) was one of the earliest cryptocurrencies, launched on December 6, 2013.
Memecoins are often criticized for lacking real value and being driven by hype and community support. But Armstrong pointed out that even Bitcoin or the U.S. dollar, once disconnected from gold, could be considered memecoins to some extent.
In essence, these assets are valuable because of the network effect and people’s belief in their worth.
Related: Just a Joke? What Are Memecoins vs Memestocks?
Armstrong compares the crypto market to the early days of the internet with animated gifs. He believes that new technologies often seem like toys at first but evolve into something much more powerful over time.
So we should be open minded about where memecoins are going, even if some are silly, offensive, or even fraudulent today. Memecoins are a canary in the coal mine that everything will be tokenized,
– he says.
According to Armstrong, everything from social media posts, images, songs, and videos to asset classes, user identities, and contracts will eventually be brought on-chain.
Brian Armstrong on Coinbase's Memecoin Policy
Speaking about Coinbase’s memecoin approach, Armstrong says the exchange offers memecoins because customers want them and it’s legal, allowing customers to choose which tokens to trade.
Meanwhile, Armstrong acknowledged the exchange's responsibility to provide customers with the necessary information to make informed choices. He explained:
If a token is a scam or fraudulent, we'd want to remove it. But if it's just low quality, the customer should be able to see reviews or community notes, and make their own choice.
What’s challenging, though, is figuring out the line between an outright scam and a low-quality token. Armstrong didn’t overlook fraudulent activities in the sector.
Without naming specific projects, he noted that some memecoins have crossed the line lately, leading people to question insider trading. Armstrong called out those involved in illegal operations, warning them that it was a road to prison.
The Get-Rich-Quick Crowd That Learns the Hard Way
According to Armstrong, there's always a get-rich-quick crowd in every crypto cycle “that comes and goes, and learns this lesson the hard way.”
He believes the industry needs to purge bad actors and uplift those trying to build lasting value. The right approach is to create products and services that people want and can benefit from, helping bring the next billion users on-chain. Memecoins are just one piece of the puzzle.
Memecoins have a role to play here, and I think will evolve to help artists get paid, track trends, or who knows what – it's too early to say, but we should keep exploring.
– Armstrong wrote.
Overall, Armstrong’s views on memecoins are balanced. He sees both the potential and the risks, without being extreme. While he acknowledges the hype and scams, he also believes memecoins can help increase blockchain adoption.
As one of the key figures in the crypto industry, Armstrong’s opinion can provide direction for many. We’ll continue to share his and other crypto founders’ views, but ultimately, it’s up to you to decide your own approach to different cryptos and broader asset classes.
Related: Brian Armstrong is faithful to his woman and his crypto exchange
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