Once again, enthusiasts of memecoins have directed their investments towards a variety of questionable tokens, coinciding with the significant legal repercussions faced by Sam Bankman-Fried, resulting in a lengthy prison sentence of 25 years.
On March 28, Judge Lewis Kaplan handed down a 25-year prison term to Bankman-Fried for seven counts of fraud, marking him as the first person from FTX to be incarcerated due to the exchange’s collapse in November 2022, which was labelled as one of the most significant corporate failures in US history.
Shortly before the sentencing, a developer launched a memecoin named Sam Baseman Fraud, amusingly labelled FTX, on the Coinbase layer-2 network Base.
Within just seven hours, the FTX memecoin experienced a staggering surge of over 23,300%, reaching a peak market capitalization of $1.5 million on March 28, according to DexScreener data.
Following the typical pattern of memecoins, the token swiftly plummeted by more than 85% in just three hours. As of writing, the memecoin’s value has stabilised, hovering around $0.06, marking a 60% decrease from its all-time highs.
Approximately two hours after the sentencing, another memecoin themed named Som Bonkmon Fraud was launched on Solana.
This Solana-based SBF memecoin witnessed a surge in market capitalization to approximately $20 million, representing an increase of over 18,000% from its initial value of $30,000. However, it rapidly lost value, experiencing a decline of more than 95% from its peak.
As of the latest update, it is trading at approximately $0.0008, slightly higher than its initial listing price.
These Bankman-Fried-themed memecoins join a collection of memecoins inspired by various cryptocurrency and political figures. Other political memecoins, such as Boden and Tremp, have aimed to capitalise on the attention surrounding the upcoming U.S. election.
The resurgence of the memecoin trend gained momentum following the meteoric rise of Dog Wif Hat (WIF), a Solana-based memecoin that surged from a market capitalization of around $50,000 to $3.5 billion in just four months.
Several other newer meme tokens, including the frog-themed Pepe on Ethereum and the rooster-themed Coq Inu (COQ) on Avalanche, have also experienced significant upward movements.
Memecoins are highly speculative investments that often lack utility or fundamental valuation, relying solely on topical interest and hype.
Notably, FTX Token (FTT), the native cryptocurrency of the now-defunct exchange, also experienced a sharp decline of over 16% following the news of Bankman-Fried’s sentencing, according to CoinGecko data.