Avalanche Foundation Buy Coq Inu and Other Tokens As Franklin Templeton Analysts See Value in Memecoins
Avalanche Foundation has lived up to its promise by buying five Avax-based memecoins including COQ and GECKO. But, do memecoins really matter?
Uno…
Avalanche Foundation has acquired Coq Inu, Tech, NoChill, Kimbo, and Gecko in its first investment in tokens based on the network.
In a recent blog post, the foundation disclosed the purchase, stating it plans to buy more community-based tokens in the coming months. It is also looking at ERC-404 tokens.
Following the reveal, the five tokens saw a significant jump in their value compared to other cryptocurrencies on the network. But they are back to trading at par with all the coins down in the last 24 hours.
The acquisition means Avalanche Foundation is living up to its promise of investing in memecoins as part of the Culture Catalyst Fund. At the time, it said memecoins play a crucial role in ecosystem development and participation, hence the need to support these projects.
Avalanche Foundation Now A Memecoiner
The foundation’s choice of memecoins is not surprising as these are projects on the network. Chicken-themed Coq Inu is the biggest memecoin by market cap on Avalanche.
The token launched in December 2023 has a market cap of $329 million. Despite falling 13% over the past week, it still gains more than 150% in one month.
Other memecoins on the list have their market cap below $30 million. Despite the low cap, they meet the eligibility criteria set by the foundation.
Meanwhile, the foundation also wants to adjust the eligibility requirements, especially those dealing with how long a project must be in existence before it can buy the token.
It said this would enable it to quickly buy tokens of new but credible projects with clear potential and use cases.
Memecoins Might Matter
The narrative around memecoins is gradually changing. Long considered to be joke coins without any intrinsic value except for speculation, some stakeholders now see them as valuable.
Avalanche Foundation is buying memecoins because it considers them vital to the web3 experience. The foundation's goal is to encourage development on the Avax blockchain, and it believes the memecoin aids this goal.
"They represent the fun, spirit, uniqueness, and interests of diverse crypto communities. The Avalanche Foundation aims to recognize these qualities and support these communities."
However, it is not only the organization that sees memecoins in a new light. Assets manager Franklin Templeton also shares a similar view.
In a new report, the firm noted a strong correlation between memecoins and their native network. Generally, a surge in the value of memecoins usually translates into increased active addresses on the network and higher trading activity.
The best example of this was BONK and how it helped the resurgence of Solana in Q4 of 2023.
However, the relationship between increased memecoin trading activity and a higher number of active addresses is common on multiple networks.
