CEO of dYdX Foundation Discusses Meme Coins and Crypto’s Future Under Donald Trump

Meme coins are a very young phenomenon in crypto. While today, they are largely associated with rug pulls and scams, they can evolve into something more meaningful. 

BeInCrypto spoke with Charles D’Haussy, CEO of the dYdX Foundation, at Consensus Hong Kong about the future of meme coins and what the crypto industry can expect with Donald Trump in the White House.

Next Steps for Meme Coins

February was a particularly bad month for meme coins and their spillover effect on Web3 adoption. 

The Libra scandal, spearheaded by Argentine President Javier Milei, led to over $250 million in losses for retail investors and left a sour taste in the crypto community’s mouth. 

Many voiced concerns over how this rug pull might affect the perception of people who have never interacted with Web3 before and whether or not this will permanently deter them from ever doing so.

However, it also left many players following an interesting thought pattern. First, President Donald Trump launched his meme coin two days before assuming office. Then, First Lady Melania Trump followed suit a day later. President Milei decided to follow their lead on Valentine’s Day. 

Will this become the new normal for political figures? According to D’Haussy, it depends on how you look at it. 

A Tool for Measuring Market Sentiment

The TRUMP and MELANIA meme coins served as an interesting measurement of market sentiment. Launched strategically the day before the presidential pair took office, the tokens’ performance reflected this sentiment.

The answer was clear: the crypto community was bullish for a Trump presidency. 

The TRUMP meme coin also served as a real-time gauge of a politician’s performance and market trust. Trading, to an extent, was based on future political expectations. 

When Trump failed to mention crypto in his inaugural speech, trading volumes dropped. The same happened when he introduced tariffs on Canada, Mexico, and China.

This situation proved interesting to D’Haussy. According to him, meme coins can be a good tool to measure public sentiment in these cases, but only to a certain degree. 

Meme Coin Use Among Younger Age Groups

On the one hand, meme coins are a particularly direct and frictionless access point to the crypto industry. Platforms like Pump.fun are particularly straightforward. On the other hand, given that meme coins have no real utility, they can be a useful tool for measuring public sentiment.

“There is one thing I like about meme coins: they are very honest. Meme coins have no fundamentals. Meme coins have zero utility. They’re very honest, sometimes more than other types of coins. But the meme coin is like, hey guys, this is worth nothing. It’s totally useless, there is no plan or any kind of road map,” D’Haussy told BeInCrypto.

Given their no-nonsense nature, meme coins can be valuable. However, their initial success, like that of the TRUMP and MELANIA coins, must be taken with a grain of salt. Their soaring prices do not reflect the sentiment of the entire market, especially considering that crypto is mostly used among younger generations.

“I think if you do a survey based on meme coins, you’re going to have a sample of a very limited and small amount of the population, so it’s not going to be reflective so much. But if you want to know exactly what the 16 to 21-year-olds think, you need to go on social media and probably you will need to go more and more on crypto markets because those coins will be there. But meme coins are not bought by my dad. My dad is not buying meme coins, but my cousins are.  So if you want to know what my cousins are thinking, you should look more and more on crypto markets,” D’Haussy added. 

Following a similar line of conversation, D’Haussy expressed that meme coins could also have the potential to be used for fundraising.

Fundraising as a Use Case

As crypto becomes mainstream, industry players contemplate different use cases in traditional areas. 

In the case of meme coins, though these tokens lack any utility, they can reach soaring heights if they effectively get a large community to back them up. Many people have already caught onto this phenomenon. 

Beyond political figures, celebrities like Iggy Azalea, Jason Derulo, and Sean Kingston, to name a few, have launched their meme coins. Though many of these cases proved to be booms and busts, they made one thing clear: if you have a solid base, your project has the potential to take off.

So, how would this mechanism work if political figures used meme coins as a tool for future political campaigns? Could political challengers raise funds and awareness by launching their meme coins rather than relying on traditional avenues like TV commercials or ads on the radio?

D’Haussy’s response to these questions was measured and cautious.

“I think for donation, yes, we have to pick the words very carefully here. Fundraising and expecting some return, no— it becomes security. For charity fundraising, for political fundraising, for something like this, I think there is something there. We’ve seen that with the ICO. It’s a really, really nice mechanism for building communities and for raising funds,” he said.

Since meme coins function on a blockchain, fundraising mechanisms would be far more transparent than traditional fundraising routes. However, they haven’t been around long, and many people use them irresponsibly. Meme coins’ risks must be mitigated before they can be considered a tool for political fundraising.

“I think we need to keep improving the formula so it does not become toxic and people cannot burn their fingers. But I’m sure it will be the same way you can sell tickets to an event if you’re doing a political race. You can sell swags, you can sell private dinners with donors. I think we can replicate exactly the same with crypto and make it global, and it’s going to be totally transparent, number one, and it’s going to be readable from the outside. It’s going to be an ICO mechanism but with different names,” D’Haussy added.

However, safeguards need to be implemented so meme coins can be used more responsibly.

A Potential Beyond Speculation

Meme coins are a very new addition to the crypto industry. Given their nascent nature, their purpose and utility will likely change, according to D’Haussy.

“I think meme coins are very young as a phenomenon. As they come and go, it’s probably the second wave of meme coin right now, and they might go quiet because lately we had some challenges and some bad meme coin episodes. But eventually, I think it’s a very good tool for people to show their interest, to show their support, and I can imagine that in the future people will buy meme coins and they will not be called meme coins anymore,” D’Haussy told BeInCrypto.

While meme coins have no inherent utility and largely reflect certain internet cultures, they are frequently used for speculative trading. As time passes, D’Haussy hopes that people will use meme coins less as betting instruments and more as a means to support a certain individual or project.

“In the past, you could buy merch. Let’s say you’re a fan of a rock band, like you wore this rock band t-shirt because you like it. You can, I think more and more people will, say, hey, I own these tokens because I just like the band. And I hope very quickly we’re going to go away from the binary speculations on meme coins because it happens to be fairly toxic. And move to something which will let the people financially express themselves and their opinion on things via meme coins, but without expecting anything,” D’Haussy said.

For that to happen, there are certain steps industry players can take to better educate the public on the yings and yangs of meme coins.

The Need for Industry-Driven Standards

Though D’Haussy believes that regulators need to regulate certain aspects of crypto, meme coins aren’t among the top priorities. This responsibility should be delegated to industry leaders themselves. 

“Should we define as industry practitioners a better framework for meme coins? I think so.  Should we all agree as a social layer that a meme coin starting with 1 billion coins on day one should not exist, should not get attention, should not be promoted and should not be talked about? If people still want to go, we can’t stop them, but we should not advertise,” D’Haussy explained.

He also said that industry players could implement certain safeguards to lower the probability of rug pulls or pump-and-dump schemes. That way, meme coins can become less toxic as they continue to pop up, making the overall design healthier.

“You should start with some kind of industry standard of launching a meme coin. Like when you launch, you can only release 20% of the supply. You need to own and lock yourself with your own money X amount of the supply. You can only mint extra tokens after different milestones,” said D’Haussy.

If industry players create standards for investors new to the meme coin market, they provide traders with a toolbox of information. These tools can help avoid negative experiences, fostering long-term involvement in the crypto sector.

“That’s why I would love for us to come up with a standard, so we can start to read more of these meme coins. Maybe Ethereum should launch a standard and say, OK, if you want to launch meme coins on Ethereum, you should follow this, and this will constantly analyse who is the issuer and what is his total ownership. Did they mint everything in one go? Are they minting slowly with a clear roadmap of achievements and milestones to release more tokens? What is the concentration of the number of holders? Are those holders locked, unlocked? Are they accumulating very quickly? We can start to understand who is behind that. Is it simple market information which is manipulated or is it organic?” D’Haussy added.

He also shared some advice for investors with a risk appetite.

Exercising Responsibility Over Risk

D’Haussy has been in the crypto industry since 2011. During this time, he has never met an honest trader who became rich from meme coins. According to him, this is simply unrealistic. 

Instead, success in this industry requires three things: patience, a plan, and damage control.

“We have to be patient. If you feel so stressed, just size your exposure and size your risk appetite. Come into crypto with a plan. Put your plan on paper. If you go with your emotion and you let your emotion drive you, you might want to cry at some point because it’s too much emotion. If you come with a plan and say, OK, I’ve actually been sizing my risk appetite, I’ve been defining a strategy, you might keep a bit of money for playing, but if you lose $100 on meme coins, it’s not going to put you at stress, hopefully,” D’Haussy explained. 

D’Haussy himself learned these lessons throughout his years in the industry. He also said that the most successful people he has met have implemented these concepts into their approaches.

“The only people I’ve met doing well in crypto are actually in this for a long time. Either they came in patient, or they became patient, or they just solidified their conviction. And if you’re not sure about what your conviction is, just again– size,” D’Haussy told BeInCrypto.

He also left a piece of advice for the more experienced industry players.

At the End of the Day, Trump Is a Politician

It’s no secret that most of the crypto community overwhelmingly welcomed a Trump presidency with their arms wide open. Trump’s campaign promises to become the next “crypto president,” and his meme coin launch just days before assuming office were a convincing indicator that he will keep his word and make the United States a crypto hub. 

But then again, Trump is a politician. His agenda is not limited to crypto; industry players must remember this.

“In my opinion, some crypto traders are smart, but many are politically naive. Trump remains a politician. Trump has been spreading and engaging with many communities, including the crypto community to make sure he gets access one more time to the White House. But 48 hours after he [became president], we’ve seen that crypto was not a top priority for him at all. The agenda of Trump is not crypto first, he’s America first. So he was able to implement tariffs and sign a few new laws within 48 hours, very, very quickly. But then for crypto, he said, hey, we’re gonna look at it more deeply,” D’Haussy explained. 

By saying this, D’Haussy did not overlook the proactive steps that Trump has already implemented. He believes crypto under Trump’s presidency will have more working room than during the previous presidency. 

That said, D’Haussy emphasizes that the industry should not expect overnight results from a sitting president.

“So yes, I think people have been a little bit naive, but overall it’s going to just take more time, but it’s very good news for the crypto market in general, in my opinion. Progress is not instant, but progress is made. And  we see that [Trump] rotated the people in charge of the CFTC at the SEC. We now have a crypto czar, so all of this is good news that things will be changing, but you can’t change regulation very quickly. There is no magic door to implement a strategic reserve very quickly for the US market overall,” he said. 

Keeping this in mind will also help industry players size their expectations. 

The post CEO of dYdX Foundation Discusses Meme Coins and Crypto’s Future Under Donald Trump appeared first on BeInCrypto.

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