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On July 13, as word spread that a would-be assassin had narrowly missed killing Donald Trump at a rally in Butler, Pennsylvania, a trading frenzy began. Within an hour of the shooting, the price of TRUMP, a cryptocurrency inspired by the former president, had jumped up by more than a third, from $6.34 to $8.69. The memecoin was, in effect, a bellwether for the upcoming US election.
Tens of political memecoins have been created within the past year; there also are coins modeled after high-profile politicians such as Joe Biden, Kamala Harris, Robert F. Kennedy Jr., and Alexandria Ocasio-Cortez. They share an iconography and naming convention: The politicians are typically represented by unflattering caricatures and their names are deliberately misspelled (instead of Joe Biden, it’s “Jeo Boden”), in homage to an influential meme comic from the 2010s.
Beyond financial speculation, the coins serve no purpose and promise no utility, but over the course of the US presidential election campaign, their market performance has correlated with the political fortunes of the individuals they depict.
Just as the price of TRUMP rose in the wake of the assassination attempt, an event that commentators had predicted would bolster his chances of reelection, the price of KAMA, the Harris-themed coin, more than tripled after Joe Biden announced his withdrawal from the race, paving the way for the vice president to become the Democratic nominee. Likewise, on June 27, the day of Biden’s disastrous CNN debate performance, the price of BODEN fell by half.
In the US, the Commodities and Futures Trading Commission (CFTC), a financial regulator, has refused to allow gambling platforms to offer bets on election results. It is explicitly illegal under the laws of numerous states for residents to place those kinds of bets, too. But buying into political memecoins has become a loose proxy—one that comes, courtesy of the violent swings in price typical of crypto markets, with both increased risk and potential reward. In aggregate, hundreds of millions of dollars’ worth of political memecoins are currently changing hands every day.
“An investment in a political memecoin isn’t an endorsement or badge of support,” says Rennick Palley, founding partner at investment firm Stratos, whose hedge fund holds memecoins in its portfolio. “The majority of people look at it as a fun way to bet on what is going to happen. If I wanted to speculate on who is going to win, memecoins are clearly the way to do it for maximum risk and maximum upside.”
The debate over whether betting on elections should be legalized in the US extends back decades, but is currently playing out in the US court system. In September, the CFTC denied an application by Kalshi, a New York–based company that runs a market for betting on the outcome of events, to let customers wager on which party would control the two chambers of Congress, which the regulator described as “contrary to the public interest.”
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In response, Kalshi sued the CFTC, arguing that there is value in giving businesses a way to hedge against a political outcome that might be unfavorable. The CFTC says it does not agree, but declined to comment on ongoing legal proceedings. The district court judge assigned to the case is expected to render a verdict within the next few months, says Tarek Mansour, cofounder of Kalshi. But while the legal wrangling continues, political memecoins are filling the void.
The TRUMP token was created in August 2023. “One big reason,” says Steven Steele, marketing director for the token, was to give people a way to bet on the likelihood that Trump would be reelected as president. “We’ve seen multiple examples of major Trump-related news corresponding with the value of TRUMP,” he says.
The token has been adopted as a “culture coin”—a sort of emblem for Trump—giving it a level of staying power that few memecoins can replicate, Steele explains. He says he’s hoping Trump will be elected to a second term, bringing about “four more years of hilarity” that could spur further run-ups in the price of the token.
Because of the variety of factors that might influence demand for memecoins, they are not a perfect proxy for placing a simple bet on the outcome of an election. “The memecoin choice is not nearly as binary as a betting market choice,” says Noelle Acheson, a market analyst, formerly of crypto brokerage Genesis. “There are many different cultural and personal reasons for buying a memecoin: Maybe you love the drawing, or are buying it to mock the whole thing.” These “layers of motivation” are part of what lends a memecoin momentum, she says, but are also a source of unpredictability—and therefore risk.
But the coins can act as a serviceable proxy, says Acheson, especially for a “digital native” generation with a different relationship with financial risk and different political mores. Due to what Acheson describes as its “frippery and frivolity” and its embrace of elevated risk, memecoin culture is arguably an extension of the meme finance craze that began in 2021, when amateur investors on Reddit worked together to drive up the price of GameStop and other out-of-favor stocks. “It’s a new form of cultural expression tied to the pantomime that politics has become,” Acheson says.
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The appetite for memecoins represents the passing of the baton from one political generation to the next, according to Palley, the hedge fund manager. “Calling in odds with a bookie might be something a boomer would do,” he says, “but the younger generation will go straight to the memes.”
