- Avalanche Foundation sets rigorous criteria for investment in memecoins, prioritizing security and fair distribution on the Avalanche blockchain.
- With clear quantitative thresholds, Avalanche aims for a balanced memecoins market and a responsible investment approach.
The Avalanche Foundation, known for powering the Avalanche blockchain, has marked a before and after in the crypto industry by announcing a strategic investment in memecoins. The key? A fund dubbed “Culture Catalyst” of $100 million. But this is not a blind bet. The foundation recognizes both the cultural relevance of these cryptocurrencies and the need for caution in the face of their unpredictability and the possibility of fraud.
what is the aim of this strategy?
To foster a balanced and responsible memecoins market, without neglecting their creative value. To achieve this, rigorous eligibility criteria and quantitative thresholds have been established for the acquisition of memecoins, prioritizing those native to the Avalanche blockchain. But what else does this decision imply?
For starters, memecoins must be native to Avalanche and have security audits conducted by reputable firms. In addition, they seek equitable distribution and sufficient liquidity. This meticulousness in selection reflects a firm stance against the accumulation of tokens by large holders, the well-known “whales.” The foundation thus promotes a more inclusive and secure environment for memecoins projects.
In concrete terms, what is required for a memecoin to be considered by the foundation as of January 2024? It must have at least 2,000 holders with the top 100 holding no more than 60% of the supply, more than $200,000 in liquidity provided by at least 50 suppliers, a minimum market value of $1 million and an average daily trading volume of at least $100,000 over two weeks. In addition, it is essential that memecoin has been in existence for at least one month, allowing the community to get to know and become familiar with it.
While meeting these criteria does not ensure purchase by the foundation, it does establish a basis for consideration. With this strategy, the Avalanche Foundation is not only aiming for responsible investment in memecoins, but could also be setting the tone for other organizations to tackle this volatile segment of the crypto market, shaping the future of this peculiar niche.
