Some hype coins mint instant millionaires. Others go bust. Why not take a chance?
They have names that make them sound delicious, like Cookie Coin. Or headed for outer space, like Pluto Coin. Or space-bound and delicious, like AstroCake, which was described this way: “Created 5 minutes ago. SAFE.”
Hype coins, as they’re known, sit squarely on the flashy, speculative end of the cryptocurrency business. Every day, dozens of them are created around the world by developers promising fortunes to would-be investors. It usually ends poorly. The vast majority of these tokens are worthless within a couple of weeks. The developers, on the other hand, can make tens of thousands of dollars, sometimes a lot more.
Despite this track record, hype coins have become the investment of choice for millions of people, most of them men in their 30s, or younger, and convinced that the economy writ large is rigged against them. Some are the same traders who have been leaping into stocks like GameStop and AMC Entertainment. To them, crypto is both a source of hope (in imminent riches) and fellowship (many coins have chats on Telegram, an encrypted messaging app, that can sound like faith-based support groups).
It’s hard to think of another financial craze in which so many people poured so much into entities with so little intrinsic value. Few hype coins have any utility as currency. Good luck buying lunch with one. Many are minted in numbers rarely seen outside astronomy books — trillions, quadrillions — which dooms them to vanishingly tiny prices.
From the outside, the hype coin party is a mystery. To understand it, you have to join it.
Which is surprisingly easy. You may have heard that Bitcoin, the granddaddy of crypto, is “mined” by power-gobbling supercomputers, a process that verges on the utterly incomprehensible. Making a hype coin, by contrast, is more like ordering a pizza online. The entire process is automated and speedy. The fixings — in this case, what to call it, how many coins to make and so on — are up to you.
So one day in May, I created my own cryptocurrency. I did it on a Zoom call with an excitable 36-year-old in Taiwan, Dan Arreola, who had posted a tutorial on YouTube about how to make, and promote, a “scam coin.” It has more than 240,000 views.
