Avalanche embraces memecoin culture despite criticism

The Avalanche Foundation is expanding the scope of the “Culture Catalyst” initiative to fund the purchase of memecoins.

The $100-million investment fund was initially focused on non-fungible tokens (NFTs), but an announcement on December 29 indicates that at least a portion of that allocation will bankroll memecoin purchases instead.

The Avalanche community and some market analysts have responded positively to the move, but memecoiners still face stigma in the crypto industry. In a recent blog post, Ethereum founder Vitalik Buterin described memecoiners as “regenerate gamblers.”

This, however, did little to dampen the enthusiasm of those already immersed in the memecoin space. Crypto researcher and Avalanche advocate Emperor Osmo is one analyst who is pleased with the move. Osmo explained to Cointelegraph why the decision to invest in memecoins is positive and will ultimately fuel Avalanche's growth.

“I equate memecoins with the power of social movements, and without a strong social movement behind it, you can't scale the blockchain,” Osmo said.

Osmo, who took over the title of “Lead Llama” in Osmosis Labs – this is crypto, after all – all the strongest blockchain ecosystems have compelling narratives and “communities of common purpose”.

Osmo finds Bitcoin, Ethereum and XRP among the blockchains that have “tight communities” as well as “the easiest product market fit.” Osmo says Avalanche can create those same traits by fostering a strong culture through its cultural catalyst.

Memecoin risk and reward

Carlos Mercado, a data scientist at crypto analytics firm Flipside, argues along similar lines to Osmo, though he emphasizes that memecoins are inherently risky investments.

“Memes give people a chance to be ‘in a group,'” Mercado told Cointelegraph. “Whether it's a memecoin startup or an active member of the WallStreetBets subreddit [the Reddit group that fueled GameStop mania], memes create a sense of ownership. Connecting this to people's personal finances is risky, but after 2008, post-Covid, the gig economy and rampant inflation, we shouldn't be surprised that people are on the road to risk.

Even with the potential risk factors, Mercado sees additional long-term benefits for memecoins. Mercado's view is that trading in memes provides the perfect training ground for newcomers, providing an introduction to the wider crypto market.

“The upside for memes is that memes can be educational, at least in crypto. Rather than relying solely on price action, providing liquidity generates exchange fees, while lending on markets like Ave generates borrowing fees. There is more option in crypto to use these coins, order flow and insider trading.” It's more heavily traded than stocks,” Mercado said.

While meme culture can be a constant mistress to natural disasters, Mercado continues, “Memories can go, but knowledge never goes away.”

Swords of gambling

Not everyone in the crypto sphere is too keen on the memecoin culture. In a recent blog post, Buterin lamented that the increase in transaction costs on Ethereum has turned off many users, leaving “degens” and many other entities he views as undesirable.

In a December 28 post, “Remake Ethereum Cypherpunk,” Buterin said, “Degen gamblers can be safe in small amounts, and I've talked to a lot of people who are motivated to join crypto for the money. Ideas. But when they're the biggest group using the chain widely, this affects the public's awareness and the inside of the crypto space. Culture adjusts and leads to many other negatives that we've seen play out over the past few years.

Buterin is not alone in his disdain for memecoin culture in general. On December 4, Jan3, CEO and BTC expert Samson Moe told Cointelegraph why Bitcoiners underestimate the rest of the crypto space.

“It's dog tokens, baby dog ​​signs, JPEGs and other random stuff. […] Bitcoin has nothing to do with these things.

Although Mow and other maximalists may want to put as much space as possible between Bitcoin and memecoins, the recent approval of Bitcoin ETFs by the United States Securities and Exchange Commission is expected to lead to a wave of fresh capital, leading to more speculation in the broad. Market.

RELATED: BlackRock Drops ‘Boomer' Bitcoin ETF Announcement As Trading Blitz Rises

Historically, while Bitcoin has done well, so have the rest of the cryptos. As for the criticism, Mercado strongly defends memecoins against the idea that they embody the worst elements of the industry.

“Ponzi schemes, hackers, pump-and-dumps, and carpet pulling are the worst elements of crypto,” Mercado said. “The best memecoins will not have these issues. Avalanche has outlined a number of metrics they are tracking — equity launches, maturity, liquid ownership — to avoid backing these bad guys.

Memecoiners promising and expectations

Memecoiners on Avalanche are now looking forward to the future with an incredible sense of hope and anticipation.

Several projects on the blockchain are being considered as potential investments for the Avalanche Foundation. If market speculation is anything to go by, Coq Inu ( COQ ), Shibavax ( SHIBX ) and Husky Avax ( HUSKY ) could be among the contenders for traditional stimulant capital injections. Following the Avalanche Foundation announcement in December, all three tokens experienced positive price action.

Cointelegraph spoke to the CEO of Husky Avax, which is popularly known by the community as Paps. As Papps sees it, the Cultural Catalyst Avalanche is just the latest in a long line of efforts to please the community.

“Those outside of the Avalanche may not realize it, but the Avalanche have been putting a lot of time, effort and money into culture over the last couple of years,” Papp told Cointelegraph. “For a while, it was primarily focused on driving artists to Avalanche, and then it shifted to creating volume in NFTs. Because of that effort, Avalanche has a significant artist community, and the volume has recently increased.”

A proponent of memecoin argued that not every initiative has gone completely according to plan or achieved success, but the level of commitment has never waned.

“Everything they did failed but they showed. [Avalanche] They're willing to put their money where their mouth is, and if something doesn't work, they'll try something else.

Fight the critics

Husky's Paps also offered an alternative point for consideration, appealing to those who have criticized or rejected the memecoin culture.

“While some memecoins argue that decentralization, open participation, censorship resistance, and neutrality are detrimental to the idea, others believe that memecoins can co-exist with blockchains and even help attract new users to the ecosystem,” he said.

“The idea of ​​decentralization means that we don't really have to control what communities do on the blockchain. If communities decide that memecoins will inspire them and help them attract new users, who are we to argue with the masses?”

As Papps explained, if the market decides it wants to fix the memecoin currency, the arguments against it are heated by the forces of democracy and decentralization.

Seeking peaceful coexistence

While it's easy to draw ideological battle lines between memecoiners and the rest of crypto, some argue that the distinction is not as clear as it seems on the surface.

Barney Mannering, founder of the decentralized Vega protocol, told Cointelegraph, “There's not necessarily an ideological difference here. It's perfectly possible for Avalanche to focus on cypherpunk ideas.

Paps supports this view, suggesting that blockchains do not need to choose one path or the other, and that they may gain wider appeal in many sectors. He argues that the memecoin culture is an added bonus to the Avalanche ecosystem, whose primary focus lies elsewhere.

“Avalanche is known for focusing on institutions, and they've closed big deals in that regard, but they're not forgetting about other types of users,” he said.

Even Buterin, who has little love for memecoins, admits that “Degen gamblers can be somewhat safe.”

Of course, the future of memecoins does not depend on the approval of any individual, no matter how respected or influential they are. Haters may hate, but in an age where new tokens can be deployed in minutes, they are powerless to prevent the proliferation of memecoins.