In a viral video, a Twitter user just showcased how easy it is to create a memecoin cryptocurrency.
The video, created by generative artist and Manifold studio developer Whitelights, demonstrated how anyone can launch a memecoin in 27 seconds using OpenZeppelin’s Contracts Wizard.
Whitelights was keen to emphasize that the video was solely for educational purposes and the token, called Easy_Money, was created on a testnet.
Testnets are blockchains designed to allow decentralized application (dApp) developers to test their products without incurring the sort of economic cost associated with using a crypto mainnet.
Assets being moved around on a testnet are supposed to be worthless.
However, Whitelights’ video has already surpassed 1.5 million views and some are concerned that, by broadcasting how easy it is to develop a cryptocurrency, the crypto scams and rug pulls may jump.
Rug pulls are a type of scam where dishonest actors trick investors into buying a worthless token.
With the ease of creating a memecoin project in less than a minute, it is possible for bad actors to develop many such projects.
Even before the emergence of the video, there had been a significant increase in the rate of memecoins created recently.
Memecoin Investors Beware of Scams and Rug Pulls
According to crypto reporter Wu Blockchain, so-called “honeypot” tokens with the same name as memecoins are proliferating.
Scammers have “released many popular Tokens of the same name such as PEPE, POGAI, TURBO etc. on the Arbitrum to make profits”, he warned.
“The basic method is to push these Tokens with the same name to the forefront of monitoring platforms such as Dex Screener and DexTools through swiping trading volume and adding greater liquidity, attracting users to buy, and then selling a large number of reserved Tokens when the price rises to a certain level Smashing the market to make a profit,” he explained.
Some of these scam coins have in-built contract designs where buyers are not able to sell, hence the name “honeypot”.
Many major industry figures have warned of the risks of investing in speculative meme coins.
In the past, Binance CEO Changpeng Zhao (often referred to as CZ) has called meme coins “high risk”.
Still, that didn’t stop Binance from listing two meme coins over the weekend, including the recently emerged coin Pepe (PEPE).
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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