• The Coinbase newsletter described the Pepe meme as a "hate symbol" co-opted by alt-right groups
  • Twitter users called for a boycott of the exchange and flooded the platform with memes
  • Experts have warned against trading meme coins due to the risks associated

A newsletter from cryptocurrency exchange Coinbase has triggered a wave of boycott calls on Twitter after it labeled Pepe meme a "hate symbol."

"The token is based on the Pepe the Frog meme, which first surfaced on the internet nearly 20 years ago as a comic-strip character. Over time it has been co-opted as a hate symbol by alt-right groups, according to the Anti-Defamation League (ADL)," Coinbase said in its Wednesday newsletter.

The newsletter had a disclaimer saying the author's opinion did not necessarily reflect Coinbase's views or that of its employees.

The ADL says the character Pepe the Frog "did not originally have racist or anti-Semitic connotations," adding that "majority of the uses of Pepe the Frog have been, and continue to be, non-bigoted."

The meme coin Pepe, which has grown nearly 55,000% since it was released sometime in mid-April and quickly became one of the fastest-growing tokens, helped drive a cumulative market capitalization of $1.8 billion earlier this week, Coindesk reported.

The Coinbase newsletter went on to warn that trading meme coins, including Pepe, was "extremely risky and many have a history of being 'rugpulls' or scam projects."

Lim Yu Qian of CoinGecko wrote earlier this month that Pepe was the only meme coin besides Dogecoin and Shiba Inu to have breached the top 100 in terms of market capitalization.

Qian did note that meme coins were a "very risky type of crypto" largely because they were "based on Internet cultural reference," thus their price movement relies on whether the coins stay relevant or not.

Thomas Kralow, the founder of University Grade Trading Education, told Decrypt that meme coins were "not a very sound investment" and those who betted on Pepe were just "lucky" that the coin saw a massive boost.

After screenshots of the newsletter started circulating on social media, the Pepe community unleashed a barrage of memes.

The hashtag "DeleteCoinbase" trended on Twitter late Wednesday as more Pepe supporters slammed the newsletter.

One user said Coinbase CEO Brian Armstrong should "retract" the "vulgar statement" about the coin. "I will be closing my personal and business accounts with @Coinbase and moving them to @Gemini," the user said.

Other Coinbase traders chimed in, calling for a boycott of the exchange.

Coinbase has not yet specified whether it intends to list the Pepe token on its exchange. A spokesperson told Coin Telegraph that the exchange had "nothing further to add."

The Pepe coin's official website describes the token as a meme coin "with no intrinsic value or expectation of financial return." It adds that the coin was developed solely for entertainment purposes.

Illustration shows a representation of the cryptocurrency and Coinbase logo
Coinbase is facing Twitter backlash over its latest newsletter's reference to the Pepe meme coin. Reuters