A growing number of companies are launching Solana tokens as a way to circumvent traditional fundraising methods. Tokens linked to these companies are hitting market capitalizations in the millions or even tens of millions—despite growing concern that many of their products are “vaporware.”
“Internet capital markets is itself a powerful meme, and it’s among the most significant and OG meta-narratives and use cases for crypto,” Alon Cohen, co-founder of Pump.fun, told Decrypt. “In principle, it represents the ability to efficiently and instantly crowdsource liquidity on decentralized crypto rails.”
The trend first rose to popularity in 2024, with the launch of Vine Coin (VINE) by the old-school video app’s co-founder Rus Yusupov. A hinted-at revival of Vine has yet to happen. Later, podcasting app JellyJelly launched a token which the founder Iqram Magdon-Ismail said worked as a good marketing tool—and was later integrated into the app.
These tokens were launched on Pump.fun, which at the time did not cycle any funds back to the token creator—although creator revenue sharing is now available on the platform. What prompted the recent explosion of internet capital markets, however, was the creation of the Believe launchpad, which splits fees 50/50 with creators.
As a result, product finding tool Dupe saw its token spike to a market cap of $79 million on Tuesday, according to DEX Screener, before dropping 77% to $17 million. AI social media assistant Creator Buddy peaked at $23.5 million and no-code Web3 builder Uber.fun $13.7 million, both of which have since fallen below $5.5 million. All of these were created on Believe.fun.
Traditional fundraising “broken”
0xdetweiler, pseudonymous founder of investment firm 3rd Street Capital, told Decrypt that traditional fundraising strategies are broken for both sides. On one hand, companies are over reliant on venture capitalists and on the other regular investors are cut out from the conversation. This means that the target audience for the product may not have an opportunity to invest.
“When you talk about democratizing finance, this is how it’s done,” Cohen added. “It’s a democratization of how ideas and projects are born and nurtured to serve economic and social needs. It starts as a meme, but it soon revolutionizes the way we live our lives.”
While the phrase itself originates from 2024, the ethos of internet capital markets runs back to the roots of crypto. 0xdetweiler claimed that it is just a repackaging of the initial coin offering (ICO) movement that swept the industry in 2017, where projects raised capital by selling crypto tokens.
“Web3 was built on allowing founders to raise funds from the public [and] ship innovative products,” 0xdetweiler explained. “They gain a community, capital and find product market fit. The go to market is a lot faster than traditional Web2 startups.”
As revolutionary as ICOs were in 2017, Bitcoin.com found that 46% of projects failed before or after raising funding and an additional 13% slowly faded away after their ICOs. This led many to believe that the ICO wave was likely a bubble that popped within a year.
Vaporware or value?
Crypto trader and social media personality Clemente Varas Collado called the most recent explosion of internet capital markets the “worst meme coin meta” he has ever seen. He claimed that most of the biggest winners were “vibe coded bullshit” projects, rather than legitimate businesses.
This sentiment is echoed by countless other market participants claiming that most of the products coming out of internet capital markets are “vaporware.” 0xdetweiler believes this is a byproduct of a glut of early adopters, arguing that more valuable products will come later. Plus, market analysts think that the overreaction is good for the industry.
“I think it's healthy when the market overreacts to this idea,” Matthew Nay, Senior Research Analyst at Messari, told Decrypt. “Speculation drives prices higher, which in turn leads to more capital entering the market, and then leads to more projects being funded that want to explore these new ideas."
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