Memecoins: The new cryptocurrency trend that's taking over the world

Memecoins are cryptocurrency named after supposedly humorous character, individuals, artwork or trends. Examples include Dogecoin (DOGE), which was set up as a satirical payment system to make fun of cryptocurrencies, and features a cartoon version of a cute Japanese Shiba dog called Kabosu that internet users found funny and cute.

Memecoins: Cryptocurrency lawyer warns against 'dangerous illusion' of viral coins named after Pepe the Frog, Peanut the Squirrel and Moo Deng

The world of cryptocurrency has long been a mystery to many people, but now a new trend is taking over - memecoins.

Memecoins are cryptocurrency named after supposedly humorous character, individuals, artwork or trends, such as Pepe the Frog, Peanut the Squirrel or Moo Deng the pygmy hippo.

But now a leading cryptocurrency lawyer has warned against the dangers of buying into the peculiar trend.

Anyone can create a memecoin and, unlike more traditional cryptocurrencies like Bitcoin, they cannot be mined.

Instead, a finite number are released with the owner keeping a certain amount.

If they surge in popularity by going viral, then the owner can sell their memecoins, generating income for themselves - although this in turn could wipe out the value for investors.

One of the most recent social media stars to suggest starting a memecoin is Hawk Tuah Girl Hailey Welch, who went viral after a making a very risqué gesture during an interview on a night out.

As well as discussing bringing out merchandise, this could be a way for her to make money.

But James Ramsden KC (pictured), a leading voices on crypto and digital asset litigation and a founding partner at law firm Astraea, called memecoins a 'dangerous illusion' and a 'complete con'

James Ramsden KC (pictured), a leading voices on crypto and digital asset litigation and a founding partner at law firm Astraea, called memecoins a 'dangerous illusion' and a 'complete con'

He told MailOnline: 'I wouldn't go anywhere near them.

'It's an illusion that's quite dangerous.

'They can be hugely popular for a while, I get that.

'It's just a very speculative financial punt which is almost completely at the mercy of the people who have put it out there.

'I think this is a complete con. It has no value or purpose.

'I'm as worried of those as any digital asset.

'I don't think you can call them that at all. It depends on algorithmic social media interaction.

'It's a very flimsy way of approaching value to anything.

'It's not the memecoins that attract people to a site, it's what is funny, what is interesting.

'Memecoins just measure the number of hits [a site or idea] gets.'

Memecoins have seen a surge in popularity since Donald Trump won the US election

Memecoins have seen a surge in popularity since Donald Trump won the US election

According to Ramsden, there was a surge in the number of people buying memecoins since the announcement of the creation of the Department of Governmental Efficiency (DOGE), headed by Elon Musk.

He added that even the slightest hint from a social media star that they are planning to start a memecoin can lead to fans buying up the coins.

But Ramsden also highlighted several problems with memecoins, including the fact that they are not subject to the same legal protections as other cryptocurrencies.

He said: 'The people who think this is a good thing will say, ''If you have millions of people following, then it's inconceivable that someone would take it down''. But look at [Elon] Musk.

'It's difficult to see where things go. Either someone stops publishing [content] or they sell [their stake in their own memecoin].'

Ramsden also suggested there could be an issue with who actually owns the idea behind the memecoin.

He said: 'The intellectual property is highly dubious. A lot of them are derived from other sources.

'[The creators] will run at the first sign of anyone challenging their right to publish it.'

Meanwhile, digital finance guru Nawab Hussain, the director of Crypto Consultants UK, told MailOnline memecoins were 'emotionally driven' and that '80 to 90 per cent are just liquidity grabs - people trying to make a quick buck'.

He added: 'Memecoins are probably the most speculative in terms of crypto. You need to be careful as an investor.'

Even so, the current trend has seen a huge surge in the number of people buying memecoins, especially since the election of Donald Trump and the announcement of the creation of the Department of Governmental Efficiency (DOGE), headed by Elon Musk.

And while many may see hints of the speculative buys ahead of the NFT market collapse in 2022, the memecoin market is, for the moment, thriving.