Amid the controversial launch of Kanye West’s official memecoin on Solana, the crypto community has sounded the alarm for another potential celebrity token scam, with insider trading allegations outshining Ye’s party.
The crypto community reported multiple red flags, including allegations of insider trading and a lawsuit waiver. Notably, the official website has a controversial waiver that raised concerns among investors.
In the “What Else Should I Know?” section, the website stated that by purchasing the token, investors agree they “will not bring, join or participate in any class action lawsuit as to any claim, dispute or controversy” that they may have against any of the “Covered Parties.”
Nonetheless, investors may opt out of the dispute resolution provision by “providing written notice of your decision within thirty (30) days of the date that you first access the Website,” the page reads.
According to the “YZYNOMICS”, 20% of the token’s distribution would be for public supply, 10% for liquidity, and 70% for Yeezy Investments LLC.
The on-chain wallet tracker also cautioned that West had added 30 million YZY, worth $34 million, to the liquidity pool with a price range of $3.17-$4.49, signaling that “once the price climbs above $3.1716, he’ll start earning fees while gradually selling YZY for USDC. If the price rises above $4.4929, all 30M YZY will be sold.”
According to their analysis, 56,050 addresses traded the token in the past 13 hours, with 25,166, or 44.9% of the wallets, engaging in one-sided transactions. Out of these addresses, 23,723 only bought the memecoin, while 1,443 only sold it.
They suggested that “some of the former may be dust addresses aimed at increasing the number of addresses, while others are either holding onto their positions or stuck in losses,” adding, “The latter are primarily project teams/large holders using multiple addresses to sell, making it harder to track them directly.”
On the contrary, over 60% of participants are still in a loss position, the report noted, with 28.2% of the addresses losing up to $500. By the time of the Defioasis post, one individual had lost over $1 million, while another had lost around half a million.
