Meme cryptocurrencies have set a trend throughout 2024. And, in times where social networks set the pulse, there was no shortage of the appearance of some crypto-influencers who promote this class of digital assets, taking advantage of the trust of their followers to obtain returns.
In many cases, a false sense of security can be created among followers, leading many to ignore the extreme volatility that characterizes meme cryptocurrencies.
But be careful! Most of these recommendations They are “dead” meme cryptocurrenciesas reflected in a study carried out by the analysis firm CoinWire. And many content consumers may not know that the influencer may be receiving money in exchange for recommending a certain investment.
The figures are alarming and serve to illustrate what is happening in this niche. The report shows that Of the 1,500 tokens analyzed, 377 were promoted by memecoin influencers on Twitter.
As explained in Criptopedia, educational section of CriptoNoticias, memecoins are digital assets that pay tribute to a mascot, political or famous figure. They do not solve any existing problem and have no use other than entertainment and financial speculation.. That’s why its price can go up or down in a matter of seconds, for no reason.
Continuing with the study, 86% of the promoted meme cryptocurrencies lost 90% of their value in just three months and only 1% of the influencers obtained a return 10 times greater than that originally invested.
Perhaps the most worrying fact is that 76% of crypto-influencers promote meme assets that no longer exist or are considered “dead.” “In fact, two out of every three meme coins they promote are worthless. These promotions usually deceive new investors, who jump into these projects without understanding the associated risks,” the report specifies.
The following graph shows the evolution of the percentage of meme coins that suffered price drops (blue line) and the average change in their price over 1 week, 1 month and 3 months.
It is important to explain that a memecoin is considered dead, according to this study, if its current value has decreased at least 90% since its initial promotion. The publication also highlights:
“This pattern highlights the instability and volatility of influencer-backed meme coins. “Data indicates that most investors end up suffering significant losses, often within just a few weeks of their investment.”
Report from analysis firm CoinWire.
For this reason, it is important that each investor conducts in-depth research on the subject to avoid falling into these types of losses that, in the end, end up being a scam because, as clarified in the report, many of these memecoins already They don’t exist.
More followers, more losses
Strikingly, the Coinware report also shows that If the number of followers of the influencer is important, the performance of the memecoins they promoted was lower.
Those who have more than 200,000 followers advertise assets that generate 39% negative returns after one week and 89% losses after 3 months, as seen in the following graph.
For their part, according to the study, influencers with less than 50,000 followers have shown better results. “25% positive returns after one week, and their promotions eventually bring 141% positive returns after three months,” the research explains.
However, this is not a data that can be linear either, much less in a market as volatile as that of memecoins. The best that What you can do is question the true value of promotions and ask who is making moneydespite the fact that the user has placed a certain amount of trust in him or the influencers.
To keep in mind, it is estimated that you can earn almost $400 for a promotional tweet and if the publication receives almost 15,000 views. “These figures highlight the incentive structure that drives influencers to promote even the most questionable tokens,” CoinWire warns in its research.
Thus things, even though the packaging While some memecoins seem colorful and even entertaining, significant losses of money are far from being fun.