Several well-known traders have also bought the newly launched token promoted by rapper Kanye West, which pumped to over $3 but has since fallen back to $1.
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Rapper Kanye West’s newly launched YZY token on Solana rocketed up to $3 billion in value just 40 minutes after its launch, but concerns over insider sales have dented a large portion of the gains.
In a Thursday X , West, who officially goes by Ye, shared the contract address along with the website for Yeezy Money, which he describes as “A NEW ECONOMY, BUILT ON CHAIN.”
The website describes YZY as a currency to power transactions within “YZY MONEY,” a ”financial system built on crypto rails.”
In a later , West was seen saying, “the official YZY token just dropped.”
Within 40 minutes, the YZY token hit a market capitalization of , but it has since fallen to more than $1.05 billion at the time of writing, according to data analytics platform Nansen.
In the fine print, it is mentioned that the token is not available to entities in restricted jurisdictions. It also warns users about the risks associated with digital assets, including a “potential for complete loss.”
One user shared a where West had warned users back in February that he was asked to promote a fake currency for $2 million, which would involve him faking his account being hacked after promoting the token.
At the time of writing, West’s net worth is estimated at $400 million, to Forbes.
Observers point to alleged insider trading
The Yeezy Money website claims that it deployed 25 contract addresses for the YZY token, with one selected at random to be the official token in order to discourage token snipers.
However, the YZY token launch has raised suspicions over insider trading, similar to other celebrity memecoins.
On-chain analytics platform Lookonchain that only YZY tokens were added to the liquidity pool, which means that the developers could sell the tokens at any time they like by modifying the liquidity of the pool.
Conor Grogan, a director at Coinbase, that at least 94% of the token supply was held by insiders, with one single multisig wallet holding 87% of the supply before it was distributed to multiple wallets.
One user who allegedly had insider knowledge beforehand mistakenly bought the wrong token, which caused them to lose ; however, they recovered all their losses by purchasing the correct token later on, said Lookonchain.
Another user has profited and paid $24,000 in priority fees to the Solana network to ensure his transaction was processed as fast as possible.
Onchain Lens similarly noted that an entity that bought the token early on sat at a profit of when the token peaked.
Crypto whales, traders are still buying
Despite the concerns, several well-known crypto traders say they’ve bought the token.
Leverage trader James Wynn stated that whales will likely be attracted to the token due to its liquidity and volume.
Wynn said that it is a short-term play, and that he is looking to double or quadruple the amount he has poured into the token. The trader cited President Donald Trump’s eponymous memecoin that quadrupled in 28 hours as his reason behind the investment.
“Aped $YZY on a 60% pull back. $TRUMP ran from $4bn to $15bn in 28 hours. 4x” Wynn mentioned.
BitMEX co-founder Arthur Hayes also appears to have bought the token.
Celebrity tokens have had a mixed track record
Celebrity mememcoins got a lot of attention this year, with Argentina’s President Javier Milei’s support of the LIBRA token seen as one of the more controversial.
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In February, the Argentine president , which caused the token to soar to a market capitalization of $4 billion; however, he deleted the post hours after facing backlash from the community, which brought the token price crashing down.
The incident caused outrage, with many calling for strict .
Earlier this year, US President Donald Trump launched the .
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