A16ZE, a newly issued token on the Believe platform, saw its market capitalization plummet from $12 million to just $500,000.
This event stemmed from misunderstandings regarding the relationship between the A16ZE token, the Andreessen Horowitz (a16z) venture capital firm, and Believe’s founder, Ben Pasternak.
The Misunderstanding That Spiked A16ZE’s Market Cap
In the morning, Marc Andrusko, a partner at a16z, went to X to clarify that neither he nor a16z had any connection to the A16ZE or B16Z tokens. This statement came after the community spread false information suggesting a16z was behind these tokens, causing A16ZE’s value to surge to $12 million the previous evening.
“I am also confirming I did not launch $a16ze or $b16z. Neither I nor a16z has anything to do with those tokens.” Marc Andrusko confirmed.
In addition to Marc Andrusko, Ben Pasternak, the founder of Believe, also stated on X that he had “no link whatsoever” to a16z, denying any speculation about a partnership between the two. These statements quickly clarified the truth but triggered a severe negative impact on A16ZE’s value.
Immediately following these announcements, A16ZE’s market capitalization crashed, losing nearly all its value. Data from GMGN shows its market cap dwindled to just a few hundred thousand dollars at the time of writing.
A16ZE’s price performance. Source: GMGN
Amid this, some users criticized Marc Andrusko and Believe for their involvement.
“So Marc Andrusko wht u gonan do with the 300k of fees u made you should donate it to charity,” trader 0xRiver8 shared.
Other traders questioned whether Believe’s system had issues or if Andrusko’s account was hacked. The delayed response caused significant losses for many investors, with an X user named cold_xyz even claiming, “I lost everything.” These reactions highlight how a lack of transparency and delayed communication from the involved parties amplified market panic.
The A16ZE incident is a warning about the risks in the cryptocurrency market, where misinformation can lead to severe price fluctuations. Believe’s lack of transparency and parties’ delay in responding caused investors to lose confidence, leading to the rapid collapse of the token.
Platforms like Believe need to increase transparency and verify information before issuing tokens to avoid similar incidents. For investors, this incident highlights the importance of verifying information before investing (DYOR), especially in a volatile market like cryptocurrency.
