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 post, 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.”
In a later post, West was seen saying, “the official YZY token just dropped.”
Within 40 minutes, the YZY token hit a market capitalization of $3 billion, but it has since fallen to more than $1.05 billion at the time of writing, according to data analytics platform Nansen.
In the website’s 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 screenshot 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, according to Forbes.
Observers point to alleged insider trading
The YZY token launch has raised some suspicions over insider trading, similar to other celebrity memecoins.
On-chain analytics platform Lookonchain remarked 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, Director at Coinbase, pointed out 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 $710,000; however, they recovered all their losses by buying the correct token later on, said Lookonchain.
Another user has profited $3.4 million 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 $6 million when the token was its peak.
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…
Click Here to Read the Full Original Article at Cointelegraph.com News…