In a recent note to investors, Franklin Templeton delved into memecoins and their role in the cryptocurrency ecosystem.
Acknowledging that meme coins like Dogecoin lacked inherent value or utility, the trillion-dollar asset manager emphasized their potential for generating profits through speculative trading.
Franklin Templeton, an American multinational investment firm, issued an investor note discussing memecoins, highlighting their potential for rapid gains despite their lack of intrinsic value or utility.
In its bulletin titled “The Value Between MemeCoins and Their Native Networks” on March 14, the firm observed the price performance of memecoins, likening it to the virality of internet memes. These tokens surged in popularity over the past year due to their distinct characteristics.
The company noted that memecoinss were user-friendly, had low fees, and offered the potential for quick profits, albeit with susceptibility to extreme price fluctuations.
The bulletin identified Dogecoin as the first and largest memecoin by market cap, catalyzing the emergence of other meme coins.
As of the time of writing, Dogecoin boasted a market cap of approximately $26 billion, ranking as the tenth largest cryptocurrency globally. This surge was largely fueled by Elon Musk’s endorsement of the coin.
Elon Musk proposed Tesla’s potential acceptance of Dogecoin for payments in the future, triggering a 14% spike in the token’s price.
The firm highlighted the strong connection between memecoins and the native networks they were built on, citing the Solana-based BONK token as an example.
BONK, the inaugural memecoin on Solana, surged over 5,700% in value over the preceding year.
In February, Revolut launched a promotional campaign to raise awareness of BONK, culminating in the meme coin reaching an all-time high shortly after the campaign’s conclusion in March.
According to CoinGecko, the total market cap of memecoins soared to $65.5 billion, constituting approximately 23% of the entire cryptocurrency market.
Franklin Templeton was among the companies that applied for an Ethereum ETF in the U.S.
Farside Investors reported that the Franklin Bitcoin ETF (EZBC), the spot Bitcoin ETF of the trillion-dollar asset management firm, saw relatively low net capital inflows compared to its competitors. It amassed just $167 million to date, accounting for only 1.4% of the total aggregate inflows across the nine recently launched funds.
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