The pieces even went from internet jokes in active dollars, attracting everyone, from occasional investors to large financial institutions and the US president in practice. Formerly playful parodies, the explosion of tokens related to celebrities, politicians and viral trends has transformed them into “very volatile and speculative assets”, ” Anwar SheluchinA doctoral student at McMaster University who is doing research on financial governance and digital currencies, told Investopedia.
Sheluchin suggested that many traders had not caught up significant changes in industry over the past decade. “Parts even are always inspired by Internet culture and trends and supported by online communities (and) media threshing cycles,” she said. But “the media threshing that surrounds them seems to operate within shorter delays than before.” She noted many pieces, such as that of the so-called “Hawk Tuah Girl” and based on her viral renown in 2024, increased and drop in a few hours “- not days and weeks.
Below, we take you quickly through dangers with these assets.
Main to remember
- The pieces even are very speculative and motivated by the media threshing of social media rather than by intrinsic value.
- Their extreme volatility could mean heavy losses for anyone who exchanges them.
- The pump and dump and market manipulation patterns are common in this sector.
What are the pieces even?
Corners are a cryptocurrency that thrives on social media threw, internet culture and community engagement – there is simply not intrinsic value Or use for them beyond that. Therefore, they look much more like casino chips than regulated investments.
Initially created as supposed jokes or parodies, they have gained ground due to speculative interest, with DOGECOIN (DOGE) pave the way. While some, like Shiba Inu (Shib) And Floki Inu (Floki), have acquired strong follows, the vast majority did not do so.
A few days before its inauguration in January 2025, President Donald Trump Emitted a $ Trump tokenThe striking as an “expression of support” for his opinions. The price of the token jumped more than 200% before crashing at less than its supply price in a few days. This model of roller coaster is the rule, not the exception, for coins.
Same corners and crime
The authorities have long highlighted the main criminal risks associated with the parts even. For example, in October 2024, the American authorities billed 18 people and large cryptographic companies with various frauds against daily investors. These regimes depended on central players in the sector – so much called “market manufacturers” – who artificially inflated trading volumes and prices through wash To create false transactions and suggest more interest from buyers for without distrust investors.
Experts like Sheluchin say that market manipulation is not the only problem in the sector. He is also in the grip of Pump and smoke diagramsIn which prices are often inflated artificially before major sales, leaving late investors at a loss.
The costs of 2024 “are a brutal reminder of how online vigilant investors must be and what to do your homework before diving into the digital border is essential,” said acting American lawyer Joshua Levy. “People who plan to invest in the cryptocurrency industry must understand how these scams work so that they can protect themselves.”
An accused in the crypto fraud case in October 2024 sent an involuntarily message to the infiltration investigators that he and the objective of his cohort on the secondary markets“(Where everyday merchants buy their meme pieces) had to find” other community buyers, people you don’t know or don’t care “because” we have to lose (others buyers) make (a) profit. “”
Other significant risks
As if all this was not enough, here are the other well -known dangers to put your money in these rooms:
- Extreme volatility: The pieces even experience unpredictable price oscillations, resulting in potential gains or significant losses.
- Lack of fundamental value: Most of the pieces even lack real world applications, solid development teams or long -term viability.
- Regulatory uncertainty: Future legal repressions or reclassifications could have an impact on their liquidity and their presence on the market.
- Security risks: You must secure your pirate parts and other criminal operators.
- Liquidity problems: Many pieces even have low trading volumes, which makes sales assets difficult at desired prices.
The bottom line
Merchants should approach the pieces even with extreme caution, more similar to the game and entertainment than an investment for your wallet. “The speculative nature of the coins, combined with their sensitivity to fraud (pump and delight schemes),” said Sheluchin, “presents significant risks for retail investorsEspecially those who are inexperienced. “”