Grimace, the purple blob character in McDonald’s advertising, is a complicated guy. When he first appeared in 1971, he played the villain, a stolen milkshake often clutched in each of his four—four!—arms. The company called him “Evil Grimace.” But as Grimace found, it’s hard to make crime pay forever. A decade or so later, McDonald’s rethought him rather significantly, reduced his arms by two, dropped the epithet from his name and turned him into Ronald McDonald’s dopey sidekick.
Unfortunately for Grimace, his legacy has grown even more complex after a weird swirl of events Tuesday. Over the past day, more than a half-dozen meme coins using Grimace’s name and image have been minted and subsequently shilled widely on social media, mostly on Twitter and Discord. Despite the broader price plummet among established cryptocurrencies, the Grimace coins attracted nearly a million dollars in collective market value within hours. Like most meme coins, the Grimace coin creators are anonymous. And like all meme coins, they lack any intrinsic value, and their owners have limited protections. In the past, meme coins have been the source of scams. (Remember the recent Squid Coin swindle?) Grimace’s accidental rise to crypto front man registers as the latest cautionary chapter in the on-going tragicomedy surrounding cryptocurrency, a technology with real promise, mostly as a better digital record-keeping system, but one that’s also a popular instrument for criminals, which ends up making everything crypto seem shady by association.
Trading things like the Grimaces amounts to people “gambling with each other,” says Billy Markus, the software engineer who created the very first meme coin, DogeCoin, in 2013. In the casino Markus describes, “most lose, some win,” he says, “and the game is usually rigged.”
To back up some, this all started Tuesday morning when Elon Musk tweeted at Grimace’s corporate parent, offering to eat a Happy Meal on live television if McDonald’s started accepting DogeCoin. (OK, let’s back up even more: Musk is a longtime supporter of DogeCoin. He mentioned it during his Saturday Night Live appearance last May and has continued to publicly tout the cryptocurrency on Twitter—even as it sank nearly 80% from its record high last spring.)
Musk’s offer to McDonald’s may seem out of the blue. It really shouldn’t. He loves to stir the internet’s pot, to provoke conversation around things he supposedly likes and many other people don’t. The other thing is, it wouldn’t be crazy for McDonald’s to take him up on it and capitalize on a viral marketing moment that cost nothing. An ever-growing list of big-banner businesses — Microsoft, PayPal, Starbucks, AT&T, Overstock.com, Twitch, Twitter, Crate and Barrel, Nordstrom and on and on — accept some form of cryptocurrency payment. Why not McDonald’s, too, especially if it could get a TV spot with the world’s richest person out of it?
McDonald’s decided to neither accept Musk’s proposal nor tell him to shove it. What it did was worse. On Tuesday evening, it tweeted this at Musk:
Clearly, this was a joke, though one not at all matching the energy of Musk’s original. The fast-food giant has no intention to start its own cryptocurrency. But the company just as clearly didn’t fully think through what might happen next. Even though the outcome was apparent to plenty of other people:
Shortly after the McDonald’s tweet to Musk, some crypto enthusiasts decided to take advantage of the corporation’s lame comeback and possibly get rich in the process. They made real Grimace meme coins, established on the Ethereum and Binance Smart Contract blockchains and traded on crypto exchanges like QuickSwap and PancakeSwap, popular places for the newest, riskiest issues that might not make it onto the mainstream places such as CoinBase.
A bunch of people had the same idea at once, so there are many different Grimace meme coins available right now. One of the bigger ones already has a market value of nearly $300,000; it has its own Discord group, where the coin’s putative creator has anonymously styled himself as BigDGrimace and set an image of Grimace dressed like a pimp as his profile picture. (Unfortunately, BigDGrimace declined to comment for this story.) To keep things going, he has implored his followers on Discord and Twitter to further market the coin. “Want to help keep the pump going strong?” BigDGrimace asks in a note to his investors posted on Discord, referring to the coin’s increasing price. “Keep searching ‘grimacecoin’ on twitter search, and spread the good gospel of Grimacecoin to those who have yet to experience salvation.”
Since it’s quite literally Day 1, it’s impossible to know what happens with the Grimace coins. Maybe their founders operated with the purest of intentions, content to create the latest internet collectible and nothing more. But … cryptocurrencies with anonymous oversight, overnight investor interest and zero fundamental financial value are perfect tools for crooks, an opportunity for someone to start a cryptocurrency, then unexpectedly end the project and somehow make off with the invested funds. In the crypto world, such a scam is so commonplace it has a name: “rug pull.” Chainanalysis, a startup that monitors cryptocurrency trading, counted nearly 25 such incidents last year, up from around 10 a year before. Rug pullers absconded with nearly $3 billion in 2021, almost triple the 2020 haul.
The rug pull we all probably know best involved the aforementioned Squid Coin. It debuted shortly after Netflix’s Squid Game series and rapidly went from less than $1 per a coin to as much as $2,860. Within weeks, the Squid Coin creator abruptly shut down the cryptocurrency and walked away with $3.3 million.
Many investors in the Squid and Grimace coins “believe that if they can get in early enough, they can win the pump-and-dump game and dump before someone else does,” says Markus, the DogeCoin creator. He draws a number of distinctions between DogeCoin and these meme coins used for no good. The most obvious: Unlike the people behind those coins, DogeCoin wasn’t invented to steal anyone’s money. Markus just wanted to have some fun online. He didn’t get rich. Two years after starting DogeCoin, he sold off his portion of the cryptocurrency and purchased a used Honda Civic.
The real takeaway from the Grimace coins is that not everyone can or should treat the web as lightly as Markus, who was just a random dude before creating his meme coin, not a $190 billion multi-national hamburger maker with 4.4 million Twitter followers.
What started as McDonald’s misguided attempt to poke back at Musk has led to an enormous opportunity for fraud with thousands of investors piling into financial assets that didn’t exist 20 hours ago. It’s an outcome companies like McDonald’s should probably mull over before romping around CryptoLand, a place without many rules—except that, there, wealth truly does materialize from thin air and bumbling old-fashioned institutions like McDonald’s and Grimace deserve to have the milkshakes knocked out of their hands.