Finance Professor Claims Trump Presidency Could Be Bad News For Meme Coins

A Donald Trump presidency could be detrimental for meme coins, which thrive as a protest against perceived injustices, according to finance professor Omid Malekan who works at Columbia Business School.

He argues that meme coins embody economic populism, reacting against the inequities of venture capital-backed tokens. Malekan warns that increased regulatory clarity in the U.S. might shift focus toward decentralized applications, leading to a prolonged downturn where many investors face losses.

In related news, the former United States President has recently voiced strong support for Bitcoin (BTC), sparking discussions on categorizing the cryptocurrency as a strategic reserve asset.

Responding To Strict Regulation

With a market capitalization of $61 billion, meme coins represent a significant segment of the crypto landscape. Malekan suggests that a Republican sweep could revive initial coin offerings and unrestricted token airdrops, countering pressures by figures like Senator Elizabeth Warren and SEC Chair Gary Gensler.

Nic Carter of Castle Island Ventures supports this view, claiming that meme coins largely emerged as a response to a restrictive SEC environment. However, critics argue that many meme coin traders are indifferent to political matters. Meme coin enthusiast Murad Mahmudov believes their appeal is tied to the rising global money supply, which he expects to continue under Trump.

Increasing Difficulty

Crypto trader Jordan Fish, better known as Cobie, adds that meme coins attract investors due to their potential for rapid price increases. He notes that it is increasingly difficult for average investors to access non meme coins early, and even a more crypto-friendly SEC may not change that.

Moreover, the vague promises made by Trump about crypto regulation aim to position the U.S. as a global leader in the meme coin space. Recent polls indicate strong support for pro-crypto candidates among crypto owners in key swing states, although the backing is nearly evenly split between Trump and Democratic nominee Kamala Harris. As the November 5th elections approach, Harris holds a slight 1.5-point lead over Trump, according to FiveThirtyEight.