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Opinion: Meme Coins Have Devolved into Tools for Retail Investor Value Extraction, Departing from Their Decentralization Roots

24 hours ago

March 16th. As per Cointelegraph, Hayden Davis, who was previously embroiled in an insider trading scandal due to the issuance of LIBRA and MELANIA meme coins, has taken another hard hit. His latest Solana-based meme coin, WOLF, witnessed a staggering 99% plunge just two days after its launch. On-chain data disclosed that over 80% of the tokens were under the control of the internal team, and the trading patterns were identical to those of previous projects. 82% of the total token supply of the WOLF token was held by the same entity, with the fund flow tracing back to the "OxcEAe" address controlled by Davis. This address had transferred funds across 17 wallets months prior to the token launch. On March 8th, the WOLF market cap briefly soared to $42 million but then crashed to $570,000, resulting in an evaporation of over $400 million in market cap. This collapse is merely the tip of the iceberg in Davis's trading history. Previously, with the issuance of LIBRA, 8 insider wallets cashed out $107 million in liquidity, leading to an immediate wipeout of a $4 billion market cap and dragging Argentine President Milei into an impeachment crisis. Argentine lawyer Gregorio Dalbon has filed an Interpol red notice against Davis, accusing him of having a "flight risk." Anastasija Plotnikova, the co-founder of Fideum, frankly stated, "Meme coins have deviated from their decentralized origins and have transformed into tools for extracting value from retail investors. Insider groups, pump and dump schemes, and sniper teams have replaced the community attributes of early meme coins, creating a distorted ecosystem. Investors need to distinguish between meme coins with genuine collectible value and 'rug pull' scams. The latter now constitutes clear-cut crimes. In the face of chaos, U.S. regulatory agencies are taking action. On March 6th, a New York State Assembly member submitted a bill to establish a specific criminal charge for 'virtual token fraud.'"
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