From Absurdity to Hotspot: The Counter-Trend Rise of a Unique Encryption Coin

Can you imagine a cryptocurrency with a silly name and no practical use becoming one of the few mainstream coins that rose against the trend in the first quarter of this year? It even successfully made its way into the traditional financial circle, catching many Wall Street investors off guard.

This striking token has the same root as GOAT, which is none other than Fartcoin.

Fartcoin was born out of an artificial intelligence conversation. In an AI agent model called “terminal of truths,” a small talk about a tech giant who “likes fart sounds” sets off a chain reaction. The AI suggested, “Why don’t you issue a coin called Fartcoin?” And just like that, this maverick token was born on October 18, 2024.

Born with a halo

Fartcoin, once launched, attracted a group of cryptocurrency enthusiasts’ attention and pursuit just like the protagonist with cheat codes in a novel.

On December 13, 2024, a joking tweet about Fartcoin went viral on social media. What makes this tweet compelling is not how amazing the content is, but the identity of the person who retweeted it — a co-founder of one of Silicon Valley’s top venture capital firms. Although he did not explicitly say that he bought Fartcoin, for such a pure meme coin project, being publicly forwarded by well-known figures in the venture capital community is itself a kind of “capital certification” and “circle breaking signal”.

More convincing evidence comes from on-chain fund movements. When Fartcoin was launched not long ago and its market capitalization was still less than 100 million USD, community members tracked on-chain addresses and discovered operational patterns very similar to those of the seasoned hedge fund Sigil Fund - multiple large purchases, active interactions, and early positioning.

Founded in 2018, Sigil Fund is a compliant, registered all-weather strategy fund launched by a group of cryptocurrency veterans, known for its focus on narrative-driven assets. Its founder frequently expressed interest in the AI-related meme coin track on social platforms at the end of 2024, and retweeted a tweet on December 13 about “Does Sigil hold $30 million in Fartcoin”. Although there is no direct confirmation, it is generally interpreted by the community as a default entry.

Meanwhile, on-chain data cross-validation shows that multiple strategy pool addresses are very similar to this fund, frequently engaging in purchasing, locking, and liquidity allocation operations during the early stages of Fartcoin.

In addition, one of the more high-profile participants in the market is a leading market maker, whose figure appeared early on the list of Fartcoin’s main holdings. According to on-chain data, the market maker holds 1.56% of the total supply of Fartcoin, making it the fourth-largest holder. In the asset allocation of its main addresses, Fartcoin ranks among the top five, even surpassing some mainstream assets.

Multiple accounts that are highly related to the main address of the market maker were also active during the early launch of Fartcoin – from building positions, market making to arbitrage trading, all in one go. It is worth mentioning that in early 2025, the founder of this market maker explained the hedging logic of Fartcoin’s over-the-counter trading in an interview and first admitted that he personally also held Fartcoin, humorously stating: “I’m just still in a losing position.”

With such market participants in place, it’s no wonder that Fartcoin can rise so strongly, completely unaffected by the overall market.

According to the statistics of a top trader, in the first quarter of 2025, most mainstream assets have fallen into a significant correction: ETH is down more than 46% year-to-date, SOL is down 24%, and AI, L1, DeFi, Gaming and other subdivisions are even more crimson. And in this “sea of blood”, Fartcoin is the only green color in the entire chart, with an increase of 14.84% in the first quarter. After entering May, the broader market has improved, and Fartcoin still leads mainstream assets, rising by more than 50%, far exceeding Bitcoin’s 23% in the same period.

Confusion and Reactions of Wall Street Professionals

The popularity of Fartcoin has not stopped within the cryptocurrency circles. What truly makes it a phenomenon is the sensation it has caused on Wall Street.

“We are in the Fartcoin phase of the market cycle.” This quote comes from David Einhorn, a billionaire who accurately predicted and shorted Lehman Brothers and founder of the hedge fund Greenlight Capital. In a letter to investors in the fourth quarter of 2024, he devoted an entire paragraph to analyzing the rise of Fartcoin, calling it “the product of pure speculative sentiment” and listing it alongside Petscom and Dogecoin as a typical representative of the financial bubble phenomenon.

It is worth mentioning that Einhorn tends to favor the Democratic Party and has established short positions in two leveraged ETFs related to the largest holders of bitcoin.

In Einhorn’s view, the name itself is full of irony, with no intrinsic value, no application, and no substitution. He even said that instead of investing in Fartcoin, he would rather buy an abstract painting by Jackson Pollock, or at least that painting “somebody would like to hang on the wall.”

However, it is precisely because he opposed it so strongly in the letter that this project became even more prominent. When a financial expert known for “rationality” and “value” begins to make lengthy comments about a meme coin, it is no longer an ordinary speculative coin.

Owen Lamont, a researcher at Acadian Asset Management, puts it more directly. In a report titled “The Fartcoin Stages of the Market,” he wrote: "I disagree with the statement that ‘Fartcoin is useless.’ It’s all about: to provoke those of us who think we’re doing serious work. "Reading between the lines is full of irrational anxiety about the market. He called this phase “fart cryptoeconomics” and pointed out that Fartcoin hits exactly the three new logics of the market – nihilism, the attention economy, and naked absurdity.

In his eyes, the core of Fartcoin’s success is not technology, but its ability to spread. It can spark discussions, create emotions, and force everyone who takes the market seriously to respond to it. Even if it’s just to criticize it, they have already fallen into its trap. “Fartcoin is a product of AI precisely manipulating human neural circuits; if you think it resembles a financial experiment designed by malicious artificial intelligence, that’s because it actually is.”

In contrast, billionaire Cliff Asness’ attitude is much more relaxed. The co-founder of a large quantitative investment company and a rational representative of traditional finance, who has always been known for his calmness and factor modeling, suddenly let go of the “rational person hypothesis” when facing Fartcoin. He wrote on social media: "Ironically, Fartcoin is the only thing I don’t suspect. In the context of that post at the time, it was a mild poke at the absurdity of the entire market.

In this tease, Fartcoin does not pretend to be “fundamental” like other assets. It never claims to be some kind of innovative infrastructure, nor does it peddle any technological narratives, but rather openly presents itself as a “product of emotions”. On the same day that he made his remarks, Fartcoin soared again, and the gains quickly expanded.

What is even more intriguing is that Asness said a few months later: “Based on the performance of Fartcoin today and over the past month, I have to say, I might have to move even further away from what Gene Fama taught me.” (Gene Fama is the founder of the “Efficient Market Hypothesis” and also Asness’s academic mentor)

Imitation Game: The Emergence of FartStrategy

The coin called “Fart” is not only firmly above a billion dollars in market capitalization, but also has its own exclusive holding entity - FartStrategy, just like Bitcoin.

When even the “meme” can replicate the model of “buy coins, buy coins again, and use holdings to support market value”, this absurd drama has truly completed the last piece of the puzzle.

Bloomberg financial columnist Matt Levine did not miss this spectacle. As a former investment banker and one of Wall Street’s most popular financial commentators, his column is considered a must-read by many finance professionals.

In his 2025 column, Crypto Perpetual Motion Machine, he specifically analyzed FartStrategy, calling it “the pinnacle artwork of financial nihilism.” The article begins with the words: “If you can sell the air bale, then why can’t it be Fartcoin?” "

The logic of FartStrategy’s operation is very simple, even blatant: it is a DAO created specifically to buy Fartcoin, with a mission statement that “hot air will rise, and we will ride this hot current to create value for Fartcoin and $FSTR (FartStrategy’s token) holders.” "

It has no profit model, no application landing, and no stability mechanism. It’s just a transparent joke, cloaked in smart contracts, and in the name of community voting, packaging “We intend to continue buying Fartcoin” as a “financial strategy”. Even the official copywriter bluntly stated: “FartStrategy is an example of comedic absurdity, and holding it should not expect any financial gain.” "

Levine likens it to a mirrored derivative of a bitcoin-holding company that buys bitcoin through constant financing, inflating the company’s valuation; The former, on the other hand, relies on the linkage between the stalk and the DAO to make the hot air self-pressurize and form a “Fartcoin flywheel”, a financial perpetual motion machine that continues to be driven by emotions. He described it as “a leveraged container with hot air as an asset”, and when its market value is higher than the total value of its actual Fartcoin holdings, it sells $FSTR and buys more Fartcoin, completing the closed loop of the meme coin ecosystem.

From Joke to Phenomenon

Fartcoin was born out of the absurd, with a foothold in chaos. According to the statistics of the data analysis platform, from January 3 to May 9, 2025, Fartcoin’s chip structure is gradually expanding from the early concentration of large investors to the decentralization of retail investors.

In particular, from January to May this year, the slope of growth in the number of addresses with a value of less than $1,000 began to rise significantly. At the same time, Fartcoin has become one of the most active coins in the alpha section of a major trading platform.

From the initial institutional dominance to the current widespread distribution of chips. All seemingly rational financial narratives ultimately reveal their essence in the absurd humor of Fartcoin.

Fartcoin almost fits all the stereotypes of meme coins: a funny name, no practical value, and entirely reliant on the effects of social media and group behavior to gain popularity, even leaving traditional financial professionals feeling quite perplexed. However, it is precisely this unabashed absurdity that has become its unique characteristic in the current market.