Kanye West stirred controversy again this week with the launch of his YZY token on Solana, where trading activity temporarily elevated its market capitalization to nearly $3 billion, only to plummet within hours.
At first, rapid investments pushed the fully diluted valuation into the multibillion range before a steep decline of over 90% brought its capitalization down to approximately $137 million.
The swift rise and fall of YZY echoed previous instances in the Solana landscape where memecoins generated significant liquidity in short timeframes. As noted by Barron’s noted, the rapid debut raised questions about whether such launches, often associated with famous personalities, need more regulatory scrutiny as early traders benefit at the expense of latecomers.
On-chain data revealed wallets accumulating large amounts at market launch. Independent analyst Conor Grogan estimated that nearly 94% of the initial supply was held by insiders, including one multisig wallet that at one point controlled 87% of the tokens before distribution.
The fee structure added another layer of controversy. Trader 0xBiZzy pointed out that the YZY pool was configured with a 1% base fee, quickly adjusted to 2.68%, along with a wider bin step causing an additional 4 to 5 percent slippage.
This setup resulted in some traders facing estimated round-trip costs of around 10% to enter and exit their positions. Nevertheless, trading volume surged initially, generating over $9 million in fees for pool operators, according to the same source.
Market dynamics revealed varied outcomes for participants. Lookonchain tracked a whale wallet that spent 1.55 million USDC to acquire nearly one million YZY tokens at $1.56, only to sell them a couple of hours later at $1.06 for 1.05 million USDC, incurring a loss of half a million dollars. Similar trading patterns emerged on Raydium as YZY’s price fell from its peak to around $1.
The launch further ignited scrutiny of West’s evolving views on celebrity cryptocurrencies. Earlier this year, he claimed such initiatives exploit fan communities, even as reports from The Block suggested that 70% of YZY supply was planned to be retained by West himself.
This structure, along with the concentration of insider ownership evidenced on-chain, intensified criticism that retail investors were at a systematic disadvantage. The sharp drop in value amplified this sentiment as many traders were left facing significant losses shortly after trading commenced.
During the Trump token spike earlier in 2025, Solana DEXs handled over $27 billion in trades daily, demonstrating how quickly speculative activity can surge on the network. YZY continued this trend, briefly enhancing Solana’s on-chain engagement while mirroring past boom-and-bust cycles.
The YZY incident encapsulated several themes in a single launch: rapid growth fueled by celebrity marketing, substantial insider positions, expensive fee structures, and a swift reversal that left many late investors at a loss.
For Solana, this event underscored that memecoins remain a significant source of volume, even as concerns around transparency and equity continue to rise.
