Crypto investors are still piling into memecoins despite the outsized risks associated with this type of digital asset, Kraken said in a report on Wednesday, after conducting a survey of holders in the U.S..

85% of respondents said that they invested in memecoins, and 76% said they believed the “potential rewards justify the risks.”

Somewhat surprisingly, “44% of crypto holders believe memecoins will improve the credibility of the crypto market,” and 42% said they expected them to outperform other cryptocurrencies this year, the report said.

Fear of missing out (FOMO) was cited as one of the top reasons for investing in these highly volatile cryptos. Recommendations from friends and family, and the fun nature of the tokens were also mentioned as reasons to invest.

Memecoins have been grabbing attention recently, but for all the wrong reasons. The apparent LIBRA token rugpull has engulfed the Argentinian government. The crypto surged to a market cap of around $4.5 billion before crashing 90%.

29% of memecoin holders said short-term gain was the main reason they bought these cryptocurrencies, with 23% citing diversification as another reason to invest.

Women were more likely to buy these cryptocurrencies than men. 86% of female crypto holders said they invested in memecoins versus 84% of men, the survey showed.

Kraken surveyed nearly 800 crypto holders in the U.S. on Jan. 9 2025.