Memecoins
TradFi hedge funds eye Memecoins as subsector shifts towards ‘cultural coins’: report
Hedge funds are starting to succumb to the lure of crypto memecoins in search of bigger gains, according to a Bloomberg report.
The Newport Beach, Calif.-based Stratos fund – backed by heavyweight investors Marc Andreessen and Chris Dixon – reportedly posted gains of 137% in the first quarter by allocating part of its portfolio to dogwifhat (Wireless), which is now the largest memecoin on Solana (GROUND).
Said Rennick Pallet, founding partner of Stratos,
“The unspoken truth is that if the fund doesn’t do it, the people who work there do. »
While memecoins basically started as a joke – perhaps with the launch of Dogecoin (DOGE) in 2013 – the investor says more hedge funds will inevitably start taking the sector more seriously as they become more familiar with digital assets in general.
“People will become more comfortable with the concept over time, which is not unlike how people have become familiar with crypto in general… I wouldn’t be surprised if companies create meme-only funds, just like they created NFT-only funds.”
Cosmo Jiang, portfolio manager at crypto hedge fund Pantera Capital, describes memecoins as “cultural coins” that offer a kind of unofficial membership in a group or movement.
“At first, the meme pieces were clearly a joke. But over time, they have evolved much more than that. People have started calling some memecoins cultural coins, they represent belonging to a culture or a group of people who share a common belief system.
Josh de Vos, head of research at CCData, notes that the liquidity and infrastructure of the memecoin sector is evolving rapidly, allowing companies in the traditional financial world, more sensitive to low liquidity, to get involved.
“Since the last cycle, the infrastructure surrounding memecoins has become more robust, with significant improvements in liquidity for several tokens… Centralized exchanges have developed sophisticated futures markets for major memecoins, allowing hedge funds to capitalize on their volatile movements and effectively hedge their exposure. »
At the time of writing, DOGE remains the largest memecoin with a market capitalization of $22 billion, but faces competition from Shiba Inu (SHIB) to 15 billion dollars and Wireless at $3.2 billion.
Don’t miss a beat – Subscribe to receive email alerts directly to your inbox
Check Price Action
follow us on Twitter, Facebook And Telegram
Surf The Hodl Daily Blend
 
Disclaimer: Opinions expressed on The Daily Hodl do not constitute investment advice. Investors should conduct due diligence before making high-risk investments in Bitcoin, cryptocurrency or digital assets. Please note that your transfers and transactions are at your own risk and any losses you may incur are your responsibility. The Daily Hodl does not recommend the purchase or sale of cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Image generated: halfway