- Polygon Labs has thrown its weight behind a pump.fun imitator.
- The move comes despite concerns over pump.fun’s failure to protect against abuse as marketed.
- Polygon Labs’ speed in backing a replica of the Solana memecoin generator raises questions about their intent.
Fueled by hype and the ever-elusive yet eternally alluring promise of getting rich quickly, memecoins have become a major driver of blockchain activity in the past year. This trend has caught the eye of several blockchains and developers, who have, for better or worse, taken several actions to encourage the mania.
In the latest instance, Polygon (MATIC) Labs insiders have backed wen.markets, an apparent copy of Solana‘s pump.fun, a tool that allows quick and cheap token launches, on the Polygon blockchain despite ongoing concerns over the latter’s inability to safeguard against abuse as marketed.
The move raises questions about whether developers are genuinely in it for the community or thoughtlessly exploiting the memecoin mania for profit.
wen.markets
wen.markets announced its launch on Polygon on Thursday, June 6. If you have ever used or even just opened the pump.fun website, chances are wen.markets will look immediately familiar to you. Like pump.fun, on opening the wen.markets website, you will be immediately greeted with a brief explainer reiterating what the tool is about: a token launchpad that makes the strong claim of eliminating the risks of rugpulls by ensuring fair token distribution and locking up liquidity.
After this explainer, the user is faced with a simple prompt: “Start a New Coin.” Granted, this is less exciting than pump.fun’s “I’m ready to pump.” From here, though, things get more exciting, as clicking the button brings you to a page where you can create a token by filling out four simple fields and paying a small fee.
At the time of writing, wen.markets has facilitated the creation of 38 tokens, which have seen a total volume of about $26,000.
The figure follows the promotion of the platform by several Polygon Labs insiders, including the firm’s DeFi Growth Lead “Crypto Texan,” community manager “Smokey,” and even Polygon Founder Sandeep Nailwal, all of which would have been unthinkable or at least controversial for a newly launched memecoin facing project in the past.
If You Can’t Beat Them, Better It?
In the past, memecoins were largely ignored or treated with skepticism at best by crypto’s thought leaders, who questioned whether the lack of utility of these tokens and their largely speculative nature set back rather than helped the industry in its pursuit of mainstream adoption and legitimacy.
However, the staying power and sheer dominance of the memecoin sector over the past year, amid dire economic conditions and a desire among users to make it big, have given even the biggest skeptics pause for thought.
Instead of ignoring the sector, project teams have shifted to encouraging and supporting its proliferation through grants, incubator programs, social media endorsements, and tools like wen.markets.
The narrative appears pretty straightforward: memecoins can be powerful tools of community engagement and an easy gateway for new users; by getting more involved, blockchain developers can help amplify these positives while providing filters to significantly eliminate potential bad actors looking to take advantage of the mania.
However, the actions of developers do not always appear to align with this publicly espoused ethos, and this appears to be the case with wen.markets.
Overpromise, Underdeliver?
Like pump.fun, wen.markets is marketed as a product that eliminates rugpulls by ensuring fair launch and locking up liquidity. However, if recent celebrity memecoin launches on pump.fun are any indication, these controls do little or nothing to safeguard users from insiders and market manipulation.
JENNER, a token launched by American media personality and former Olympic gold medalist Caitlyn Jenner on May 28, lost about 65% of its value days after it launched as an insider dumped most of the tokens.
Similarly, on May 29, Nigerian music star Davido jumped in on the action, launching DAVIDO. After creating the token, the artist acquired nearly 20% of the supply, which he promptly dumped on his followers after only a few hours for a $500,000 profit.
At the same time, while MOTHER, a token launched by Australian rapper Iggy Azalea, appears to continue to wax strong, Bubblemaps research suggests that insiders acquired about 20% of the supply before the token was announced and have already dumped $2 million worth of token on users.
These issues raise questions about why Polygon Labs has been quick to back a blatant copy of pump.fun without improved guardrails or at least more honest marketing.
On the Flipside
- The recent promotion of wen.markets is not the only time Polygon Labs’ involvement in the memecoin sector has raised eyebrows. In May 2024, a community member called out executives for their roles in endorsing memecoins that turned out to be pump-and-dump schemes.
- There have yet to be reports of a pump-and-dump scheme on wen.markets.
Why This Matters
Developers often claim to be acting in the community’s interest, and wen.markets is marketed as serving this purpose by protecting against rugpulls and insider manipulation. However, the application ultimately makes it easier for bad actors to take advantage of the community while driving up the network’s activity and revenue, which primarily benefits Polygon Labs.
Read this for more on Polygon Labs’ recent memecoin involvement:
Polygon CEO Doubles Down on Memecoin Support, Blasts Critics
See how Polygon is bolstering cloud options for developers using its Layer 2 kit:
How Polygon (MATIC) Brings the Cloud to Builders With Fleek
Sourced from dailycoin.com.
Written by on 2024-06-07 21:00:00.
