Kanye West’s YZY token has become one of the most talked-about developments in the crypto market this year.
The effects have prominently impacted Solana’s decentralized exchange (DEX) ecosystem.
Meteora in the Limelight
According to DeFiLlama data, the introduction of YZY infused significant liquidity and speculative excitement into Solana, leading Meteora, an emerging DEX, to achieve an astounding $1.182 billion in trading volume on August 21st. Consequently, Meteora surpassed long-time frontrunner Raydium as the most active Solana-based exchange.
This achievement wasn’t solely about volume; Meteora also accumulated $16.05 million in fees during the same timeframe, ranking second only to Tether in fee revenue across the crypto landscape.
Meteora’s surge illustrated how a celebrity-backed token can serve as a short-term catalyst for trading platforms by boosting both activity and revenue in ways that even established DeFi protocols seldom accomplish. Nonetheless, the YZY frenzy exposes underlying issues surrounding celebrity tokens, insider dealings, and retail investor vulnerability that challenge the crypto industry.
Santiment aptly captured the sentiment as it highlighted how the YZY token skyrocketed to a $3 billion market cap virtually overnight, only to plummet over 60% amidst insider dumping rumors. The hype was undeniable: West’s initial entry into crypto contradicted his prior public position this year when he dismissed the concept of launching a meme coin, calling them a method to “exploit fans with hype.”
His change of heart intensified the excitement, attracting both fans and opportunistic traders, but the aftermath left many latecomers with substantial losses.
Was YZY Rigged?
On-chain analysis by Dethective deepened the debate and revealed how specific wallets acquired significant YZY allocations at just $0.20, while most participants entered at higher prices.
One wallet turned a $250,000 purchase into nearly $1 million in profit within just eight minutes before transferring the funds to a treasury wallet. This wallet was later linked to suspiciously similar profit strategies employed during the LIBRA token launch, raising concerns about insider collaboration.
Overall, these wallets extracted approximately $23 million from both YZY and LIBRA by leveraging early access advantages.
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