Modern Monetary Theory and the Valuation of Cryptocurrencies: Do MMT Principles Support Rapid Increases in Token Prices?

In 2025, the convergence of Modern Monetary Theory (MMT) and the valuation of cryptocurrencies has become a central topic among both investors and regulators. As central banks increasingly turn to strategies to address the instability following the stablecoin crisis, a key question emerges: Do these economic models support or forecast sharp price increases in tokens such as Momentum (MMT)? This article explores the credibility of MMT-based valuation forecasts, the influence of speculation, and the broader consequences for the digital asset sector.

Differentiating Modern Monetary Theory and the Momentum Token

Modern Monetary Theory, as an economic approach,

can spend without immediate budgetary limits, focusing on fiscal measures over monetary policy to guide inflation and economic growth. By contrast, the Momentum (MMT) token—a digital asset on the blockchain—has seen its price soar by 1,300% in 2025, of 7.5 million tokens and clearer regulations under the U.S. CLARITY Act and EU MiCA 2.0. Despite sharing the abbreviation "MMT," the token and the theory are based on fundamentally different economic principles and market behaviors.

MMT Approaches and Crypto Asset Valuation

Central banks have woven MMT concepts into their policy arsenal,

toward more focused liquidity measures, while stressing the importance of digital asset market stability. This evolution has brought about the idea of a "growth risk premium," and persistently low interest rates are changing how assets are valued. For digital currencies, this presents a contradiction: , once seen as a safeguard against inflation, and traditional investments become more competitive.

Algorithmic stablecoins like USDsd

during periods of monetary expansion, often struggling to retain their value without adequate backing. At the same time, central digital currencies (CBDCs) are gaining momentum as state-supported options, over decentralized experimentation. These trends indicate that MMT-inspired policies are altering how risk premiums are calculated, instead of focusing solely on speculative interest.

Momentum Token: Speculation or MMT Impact?

Although the Momentum token’s dramatic 1,300% rise in 2025 is sometimes linked to MMT, a deeper look suggests otherwise.

boosted their holdings by 84.7% in the last quarter of 2025, motivated by regulatory transparency and new blockchain-based income products. The Binance airdrop further increased retail investor involvement, , sparking a wave of speculation. Ultimately, it is these elements—regulatory progress, institutional interest, and retail excitement—rather than MMT itself, that have been the main forces behind the token’s surge.

Scholarly Views: MMT and Speculative Forces

Studies published in 2025

, where core factors like user adoption and network effects coexist with speculation driven by diverse investor outlooks. While MMT provides a lens for understanding macroeconomic trends, the crypto market is still largely shaped by speculative activity, especially in decentralized environments. Behavioral finance theories, such as those by Brock and Hommes, —a phenomenon directly addressed by MMT.

Dangers of Speculative Mania

Indicators like the Money Flow Index (MFI) and Relative Strength Index (RSI) have been useful in forecasting crypto trends,

. For example, the Federal Reserve’s adoption of MMT-like tactics has by steering investors toward regulated digital assets. Still, this does not mean that MMT frameworks can consistently anticipate individual token rallies. The Momentum token’s price explosion, while occurring alongside MMT-inspired policy changes, was mainly the result of speculative moves by both retail and institutional players, not a direct result of MMT theory.

Summary: Weighing MMT Against Market Realities

Modern Monetary Theory is undoubtedly influencing the broader economic context for digital currencies, especially through the rise of CBDCs and evolving regulations. However, dramatic price increases in specific tokens—like that of Momentum—are still primarily the outcome of speculation, airdrops, and institutional strategies, rather than MMT fundamentals. Investors should be careful to separate broad economic trends from token-level speculative forces to avoid overestimating the predictive value of MMT in crypto markets.

As 2025 draws to a close, the relationship between MMT and crypto asset valuation will hinge on how well policymakers can balance fiscal adaptability with technological strength. For now, MMT-based price forecasts remain unsubstantiated, with speculation continuing to play the dominant role in shaping crypto market trends.