The recent meme coin rally on the Cardano network has been met with a divided response from its community. While some hail it as a sign of growing network activity, increased volume and heightened attention for Cardano, others are expressing concerns about potential negative implications, such as draining liquidity and the proliferation of scams and exploits.
A tweet thread recently ignited debate among Cardano enthusiasts. One user criticized the meme coin phenomenon for its lack of economic value, likening it to "shilling grass clippings to your neighbor." He further lamented that it does not contribute to Cardano's mission of changing the world.
Another user in the thread questioned the utility of such coins. Since they do not offer equity rights, dividends or buybacks, he wondered how value added by the project would benefit token investors. He posited that for a utility token to truly benefit its holders, its utility value would need to increase over time.
Some detractors argue that meme coins might drain liquidity from the network, with a few users making massive profits at the expense of many. They also fear the risks of scams and exploits. The entry of such tokens, often characterized by hype and speculation, could attract malicious actors looking to take advantage of uninformed investors.
However, not everyone in the Cardano community shares these concerns. Some argue that the growth of the meme coin market can be beneficial. For them, increased trading volume and network activity can be seen as indicators of a thriving ecosystem. The buzz generated by these coins might draw more attention to the blockchain itself, potentially attracting more developers and projects.