Pump.fun co-founder Alon Cohen said that most tech altcoins feature the same value proposition as memecoins but come with low float, high fully-diluted value, and the involvement of venture capitalists, who are notorious for using retail traders as exit liquidity.
Cohen was responding to a post insinuating that the memecoin launch platform derailed the altcoin price cycle and said that Pump.fun existed months before the altcoin sector experienced a downturn starting in April 2024.
“Retail was burned too hard last cycle to just come back to invest in the ‘future of finance,'” Cohen wrote as an explanation for the April 2024 altcoin crash.
According to Cohen, “Most people with day jobs don’t give a shit about tech, they care about personal fulfillment” and want to make a modest amount of money in trading while having fun.
The social media exchange highlights the growing tension between tech-based altcoin investors focused on utility and traders speculating on the price of assets without proven use cases.
Related: Law firm demands Pump.fun remove over 200 memecoins using its IP
Are memes to blame for the price suppression of alts?
Pump.fun launched in January 2024 amid an already thriving memecoin ecosystem driven by online communities on X, formerly known as Twitter, Reddit, Telegram, and Discord.
The Total3 indicator on TradingView — a measure of the total crypto market capitalization excluding Bitcoin (BTC) and Ether (ETH) — shows that the total altcoin market cap hit a local high of roughly $788 billion in March 2024.
However, altcoin prices collapsed in April 2024 and did not reach another high until November 2024 during a historic price rally for cryptocurrency markets in response to the re-election of Donald Trump in the United States.
Many analysts have pointed out that the crypto markets are now oversaturated, and too many different currencies are competing for limited mindshare and capital.
Despite the market oversaturation, altcoins with institutional investors tended to perform better than projects without institutional backing throughout 2024.
This is due to institutions buying digital assets on the open market, rather than closed-off sales, and helping support prices, Co-founder of Animoca Brands Yat Siu argued.
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