The value of YZY digital currency, owned by Kanye West, reached $3 billion within 40 minutes on the Solana blockchain before collapsing to $1.05 billion.

Analysts revealed that 94% of digital tokens are owned by insiders at launch, with one wallet controlling 87% of the total supply.

Rapper Kanye West launched the YZY digital currency on the Solana blockchain, achieving impressive initial results, but faced significant market obstacles. The currency reached a new record of $3 billion in market capitalization in just 40 minutes after its launch announcement on Thursday. West announced the release via his social media platform X, publishing the terms of the contract and announcing a new blockchain-based economy called Yeezy Money.

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West's entry into the world of digital currencies is his latest business venture, which has already expanded into other commercial projects in the music and fashion sectors. West clarified on the Yeezy Money platform that the project aims to create a new blockchain-based economy. However, the value of the currency sharply declined to about $1.05 billion as investors began to fear potential market manipulation.

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Allegations of insider trading overshadowed the success of the launch.

Cryptocurrency analysts quickly noticed some suspicious activities in the market, raising doubts about the proper distribution and trading of the token. A cryptocurrency expert found that 94% of the total supply of YZY tokens was in the hands of insiders at launch. One multisignature wallet held 87% of the tokens, which were then distributed across a variety of addresses to reduce ownership concentration.

Lookonchain criticized the token's liquidity structure, pointing out that the developers maintained excessive control over the trading mechanism. Only YZY tokens were listed in the liquidity pool, allowing developers the opportunity to manipulate the token prices by controlling the liquidity amount. This arrangement allows insiders to sell their holdings at favorable times at the expense of ordinary retail investors.

Despite this, some of the most prominent cryptocurrency traders are still buying YZY tokens, viewing the situation as a short-term speculative opportunity. James Wynn, a leveraged trader, likened the situation to President Trump's, where the value of his 'meme coin' quadrupled in 28 hours. Even the co-founder of BitMEX, Arthur Hayes, is said to have invested in the controversial token despite the insider trading allegations.

Celebrity-promoted digital tokens have shown mixed performance in 2024, with Argentine President Javier Milei also embroiled in controversy over promoting the LIBRA currency. The launch of the YZY token symbolizes ongoing issues in the 'meme coin' sector concerning transparency, fair distribution, and celebrity manipulation of volatile markets.