Elon Musk is currently engaged in an effort to tackle the alarming $36 trillion U.S. debt through his dogecoin-themed Doge agency aimed at improving government efficiency, which has sparked rampant speculation about bitcoin adoption.
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The bitcoin price, which surged following President Donald Trump’s election victory in November, has since retreated amid concerns that U.S. tariffs could adversely affect the global economy. Some analysts are cautioning that the recent downturn in bitcoin prices may be just the beginning.
Now, with Musk expressing his intention to drive the U.S. Treasury to adopt bitcoin and crypto blockchain technologies, the billionaire has cautioned that those hoping to “win” by investing in so-called memecoins are being “foolish”—especially as a potential memecoin crash could jeopardize the bitcoin price recovery.
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Elon Musk, who is at the forefront of the dogecoin-inspired Doge department of government efficiency, has cautioned that … [+]
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“It’s kind of like going to a casino; if you think you’re going to win, you’re being foolish,” Musk told comedian Joe Rogan during an extensive three-hour podcast discussion.
Dogecoin, a humorous bitcoin competitor championed by Elon Musk, is one of the original memecoins and reached an impressive $80 billion market cap during the Covid-era crypto boom before experiencing a significant downturn.
Nonetheless, dogecoin has maintained more of its gains than expected and is currently valued at around $30 billion.
“If you believe you’ll profit from memecoins, you’re mistaken. Don’t invest your life savings into a memecoin… don’t risk everything,” Musk warned.
The latest surge in memecoin trading ignited last year, driven by new platforms like Pump.fun, which enable users to create memecoins within seconds.
Memecoins like dogwifhat, pepe, bonk, and shiba inu saw their values skyrocket, peaking with the debut of a Donald Trump-themed memecoin endorsed by the president.
“We’ve become captivated by price surges, memecoin manias, and media happenings, losing sight of the fact that crypto was supposed to be a new financial framework—one that empowers everyone through decentralized systems,” commented Dom Harz, co-founder of the decentralized finance (DeFi) platform Build on Bitcoin (BOB), in an email.
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The bitcoin price has seen significant declines, largely due to a memecoin market crash that Elon Musk has … [+]
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The memecoin market reached a high of $137 billion in combined capitalization last December, according to CoinMarketCap, before experiencing a sharp decline and then a resurgence when Trump addressed his $trump memecoin.
The $trump memecoin surged past $60 before crashing again and is now trading below $14.
“The problem goes beyond just price drops—it’s the growing awareness that insiders can amass large quantities quickly, use major exchanges for liquidity, and offload to retail investors at over $60 per token, only for it to plummet below $16. This realization may be hampering speculative interest,” wrote Markus Thielen, founder of 10x Research, in an email.
“This change in sentiment has greatly reduced retail speculation, prompting a more cautious outlook. Daily launches of meme coins reached their zenith shortly after the debut of $trump, but have since declined considerably. $Trump is now down 85% from its peak, currently trading at just $11.5, leaving retail investors again facing significant losses after succumbing to the hype.”
