- Current regulations allow meme coins to thrive, while actual projects are being shut down.
- Chris Dixon suggests better regulations instead of fewer regulations on cryptocurrencies.
- Meme coin category down following Dixon's article.
Chris Dixon, a general partner at crypto fund A16z and author of Read Write Own, wrote in an article on Monday about the growing regulatory actions against crypto projects, stating that crypto regulations must not prioritize memes over matter. Several meme coins are experiencing losses following the article’s publication.
Also read: Solana, Base and AI meme coins rally, are speculative tokens making a comeback?
Regulations favor meme coins
With the continuous spread of lawsuits against crypto bodies, concerns about government regulations have greatly risen, causing much worry about the future of crypto in the US.
In his post, Chris Dixon highlights the absurdity of this US regulatory regime, stating how meme-only tokens are allowed to thrive. At the same time, crypto companies and blockchain solutions face continuous attacks.
He opines that the Securities & Exchange Commission's (SEC) "role is to protect investors; to maintain fair, orderly and efficient markets, and to facilitate capital formation." Dixon decries the SEC's failure to carry out its objectives, especially with digital assets.
"Current regulations encourage platforms to list meme coins and not other, more useful tokens that make it possible for individuals and communities to own internet platforms and services," said Dixon.
Read more: Meme coin madness returns after Bitcoin halving concludes
Meme coins are freely allowed to trend on markets without any regulations against them, yet "more innovative projects struggle."
Following the release of Dixon's article, several meme coins have taken in losses with Dogecoin (DOGE), Shiba Inu (SHIBA), Pepe (PEPE), dogwifhat (WIF), Bonk (BONK) and Floki Inu (FLOKI) all down more than 4%.
Dixon's article follows a response by Eddy Lazzarin, the CTO of A16z crypto, who recently alleged that memecoins are like "a risky casino" in reply to an X post.
Interest in memecoins will come and go, and I'm optimistic that real products/protocols will develop in the end.
— Eddy Lazzarin (@eddylazzarin) April 24, 2024
But we shouldn't pretend that the casino doesn't set us back. Deterring great founders and giving ammo to politicized regulators has a profound effect. https://t.co/PZNjnSLqfb
According to Dixon, the solution isn't fewer regulations on cryptocurrencies but better ones. He suggested "...adding well-tailored disclosures to provide regular investors with more information."
He also suggests regulators should "require long lock-up periods to prevent get-rich-quick schemes."
Several crypto institutions, including Uniswap, Coinbase, Ripple and Consensys, are currently in legal battles with the SEC.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Celebrity meme coins controversy continues amid Pump.fun revenue dominance
Pump.fun outperformed the Ethereum blockchain on Tuesday after raking in $1.99 million. Following this achievement, a meme coin based on actress Sydney Sweeney was the subject of controversy after its developers dumped their bags on investors.
PEPE's on-chain metrics indicate potential rally after weeks of silence
PEPE has struggled to see any significant price move after reaching an all-time high in May. Increased adoption rate and low MVRV ratio indicate a bullish run may be on the horizon. A single PEPE outflow from Binance worth $14.7 million gives credence to signs of bullish expectation.
Ethereum has failed to overcome key resistance despite bullish sentiment surrounding ETH ETF
Ethereum (ETH) is down more than 1.4% on Tuesday following another ETH sale from the Ethereum Foundation. Meanwhile, crypto exchange Gemini's recent report reveals that ETH ETF could see about $5 billion in net inflows within six months of launch.
Crypto community blasts Polkadot following report of treasury spending
Polkadot reports $87 million of treasury spending during H1. Crypto community members expressed harsh feelings toward the DOT team's high spending. DOT is up more than 2% in the past 24 hours but risks correction following the report.
Bitcoin: BTC price correction could end in July, according to seasonal data
Bitcoin (BTC) price appears poised for a decline this week, influenced by slight outflows in US spot ETFs, selling activity among BTC miners, and a combined transfer of 4,690.28 BTC to centralized exchanges by the US and German governments.