What started as an apparent ‘hallucinated’ response from X’s artificial intelligence platform, Grok, quickly morphed into a microcap memecoin frenzy.

The X-based AI tool last week spat our the terms “MechaHitler,” “GigaPutin” and “CyberStalin” in the same breath in an apparent unprompted response to a user query, an erratic, racially charged response that went viral.

MechaHitler is a fictional cyborg version of Adolf Hitler from the 1992 game Wolfenstein 3D, which gained fame in 90s satire and early internet memes.

While most consider such terms to be dark, offensive, and completely unhinged, some someone took the misfire seriously enough to launch multiple tokens under the name.

Over 200 «MechaHitler» tokens went live across Solana and Ethereum, among other networks, in the past 24 hours. The largest one, launched on Solana-based Bonk.fun, hit a $2.2 million market cap just three hours after launch, with early trading volume exceeding $1 million, data from DEXTools show.

At least one Ethereum-based version zoomed to over $500,000 in market cap.

The various tokens followed classic meme coin playbooks: rapid launches, early whales, and volatile pumps and dumps. But unlike DOGE or PEPE, this wave didn’t emerge from a community or subculture — it came from a chatbot meltdown.

Grok clarified in follow-up posts that the apparent misfires wholly referenced the game character and not the infamous Austrian-born German politician.

As for the tokens: short-lived or not, they underline a clear trend: That in 2025, crypto doesn’t need hype from influencers anymore, an AI hallucination could be enough.

Read more: Memecoin PNUT Rips on Elon Musk’s Epstein Cue

‘Peanut’ the squirrel is dead, but the meme coin named after him is still mooning.

A late-night post from technocrat Elon Musk slamming U.S. authorities for euthanizing the viral squirrel while failing to charge anyone from Jeffrey Epstein’s alleged client list preceded a volume and price spike, data shows, showing speculative fervor is alive and well in the market.

(The «Epstein list» refers to high-profile individuals allegedly connected to Jeffrey Epstein’s sex trafficking network. No official, verified public list exists.)

“Government is deeply broken,” Musk wrote. “They arrested (and killed) Peanut, but have not even tried to file charges against anyone on the Epstein client list.”

Within minutes, Solana-based meme token PNUT spiked over 10% as traders piled in on the name-drop.

PNUT, which has no affiliation with the actual squirrel or Musk, saw trading volumes surge over 120% from $65 million to $214 million in a 24-hour period, according to CoinGecko. The token’s price briefly touched 23 cents before cooling.

With no protocol, no utility, and no roadmap, PNUT trades purely on cultural resonance and reflexive speculation. That makes it a favorite for momentum hunters, and a token to watch for when controversial topics do the rounds — at least on Musk’s X.

Read more: Elon Musk Says America Party Will Embrace BTC as ‘Fiat Is Hopeless’

Bitcoin (BTC) and XRP (XRP) are trading sideways, which is likely being driven by a hidden force that’s keeping both cryptocurrencies anchored to key price levels.

However, the same «price magnets» might add to the ether (ETH) market volatility.

We are talking about market makers – entities tasked with creating liquidity in an exchange’s order book. These entities are always on the opposite side of traders/investors and make money from the bid-ask spread, while constantly striving to maintain a price-neutral exposure. Their hedging strategies in futures/spot markets often add to or curb volatility in the market.

In BTC’s case, options market makers are «long gamma» at strikes $108,000 and $110,000, according to Deribit-listed options activity tracked by Amberdata. The position indicates that market makers hold long options (calls and puts), which stand to benefit from potential volatility.

As such, market makers are likely trading against market movements – selling high and buying low – to maintain the direction-neutral book, effectively keeping BTC pinned in the $108,000-$110,000 range. BTC’s price has mostly traded the said range this month, according to CoinDesk data.

A similar dynamic seems to be playing out in the XRP market, where a large positive market maker gamma build up is observed at the $2.30 strike price. That calls for maker makers to buy low and sell high around that level capping volatility.

Ether prone to volatility

Ethereum’s native token ether, the second-largest cryptocurrency by market value, hit a high of $2,647 early today, the level last seen on June 16.

The move has pushed ether into a «negative market maker gamma» zone of $2,650-$3,500. When dealers hold negative gamma, they tend to trade in the direction of the market, exacerbating bullish/bearish moves.

In other words, their hedging activities could add to ether’s bullish momentum, exacerbating volatility, assuming other things being equal.