Memecoins represent the perfect blend of cultural trends, internet humor, and blockchain technology. One of the most recent types of these hype coins are celebrity coins or celeb coins. Memecoin platforms like Pump.fun make it easy to create and trade these assets. As such, we will be taking a closer look at celebrity coins on Pump.fun to see how they work and why they are becoming popular. Let’s dive right in!
KEY TAKEAWAYS:
- Celeb coins are assets that get their value from the identity or influence of a celebrity.
- They have gained popularity because of celebrity influence, fandom-based value, comic relief, and financial speculation.
- To use Pump. fun for your celeb coin, you will have to sign up and set up your wallet, create the coin, launch it, and promote it.
- There are some risks associated with investing in celebrity coins, and they include volatility, celebrity withdrawal, regulatory scrutiny, and pump-and-dump scams.
What Are Celeb Coins?
They are a type of cryptocurrency that derive value from the identity and influence of a celebrity. They can either be created as a tribute to famous persons or as a collaboration between a celebrity and the developers of the coins. Although these tokens do not have actual use cases, they sometimes thrive because of internet culture and the public figure’s fanbase.
Why Are They Gaining Popularity?
Alongside their hype value, here are some reasons celeb coins are increasingly becoming popular:
- Celebrity influence: A single comment, tweet, or even post about this asset can cause its price to skyrocket.
- Fandom-driven value: Celebrity coins give fans a chance to express their love and support for their idols monetarily.
- Comic relief: Just like other types of memecoins, celeb coins are appealing to many people because they are based on humor and satire.
- Financial speculations: Crypto investors who are looking for high-risk and highly rewarding opportunities are drawn to them because of the possibility of making quick profits.
How Celebs Coins Work on Pump.fun
Pump.fun is a Solana-based platform that is packed with numerous tools that make it easy to create, launch, trade, and promote celeb coins in a few steps. It has proven to be a good spot for celeb coins because it has produced a number of successful ones like Hobbes, JENNER, and BaoBaoSol.
That said, here is a quick rundown of how the process works.
- Sign up and set up your wallet: You can get started by creating a Pump.fun account and linking a Solana-based wallet like Phantom.
- Create a celeb coin: Pump.fun has an intuitive interface that allows you to customize the name, symbol, and total supply of a celeb coin.
- Launch it: Once the token is created, you can list it on Pump.fun’s marketplace for others to trade. The marketplace provides liquidity for the coin to be bought and sold.
- Promote and trade: A celeb coin is only as successful as how well it is promoted. Fans or celebrities themselves have to spread word across social media about the existence of the celebrity coin. Its value will then rise or fall based on market sentiments.
The Impact of Celebrity Endorsements on The Memecoin Market
For a long time, celebrities have had a major impact on customers’ attitudes to a product, including celeb coins. Indeed, an endorsement or otherwise can make or make a commodity. For example, one of Elon Musk’s tweets about Dogecoin led to a massive hike in its price. While a public figure’s approval can lead to the impressive success of a meme coin, it has led to concerns about the volatile and speculative nature of this type of cryptocurrency.
The Risks of Investing in Celeb Coins
Before rushing in to invest in celebrity coins, it is important to understand the risks involved. Below is a quick overview of the shortcomings of celeb coins.
- Volatility: They are extremely volatile. As such, you should be ready for the possibility of substantial gains or losses within a short period.
- Celebrity withdrawal: Since celeb coins have no inherent value beyond their association with a public figure; they can crash if the celebrity withdraws from the project.
- Regulatory scrutiny: The celebrity coin space is largely unregulated. Thus, a coin can be cracked down by governmental authorities if they consider it to be misleading.
- Pump-and-dump scams: Celeb coins may be launched with the intention to scam investors. In a pump-and-dump scheme, the asset’s developers artificially hype the price of the coin and convince investors to buy it. Then, they sell off their own holdings when the coin reaches a peak value and abandon the project.
How to Spot Legitimate Celebcoins
You need to perform the due diligence of thoroughly researching the legitimacy of a celebrity coin before investing in it. Here are some things to look out for.
- Verified endorsement: Confirm an official announcement of partnership by the celebrities themselves instead of relying on speculations or rumors from fans.
- Trustworthiness: Check if the celebrity coins have been audited and if it has enough liquidity to support trading.
- Community engagement: Look for celeb coin projects with active community engagement. It is proof of an asset that has a higher chance of thriving.
Conclusion
Celeb coins are a fascinating category of asset and Pump.fun makes it easier to create and trade them. As such, you can interact with your idol’s fame in a lighthearted way. However, you have to approach celebrity coins with caution because of the potential risks involved.