Davido Faces Backlash for Profitable Launch of Meme Token Amid Fears of Token Dump
Summary:
Afro-pop star Davido faces criticism over his handling of his new meme token, DAVIDO. According to Lookonchain, Davido made a substantial profit by selling a significant portion of his token shortly after its launch. Despite earning $473,000 within 11 hours and remaining with an unrealized profit of $207,000, his actions sparked severe backlash from his fanbase and crypto experts. Critics believe Davido's strategy could potentially lead to a token dump, undermine industry credibility, and expose fans to financial risk. This controversy occurs amidst the rising trend of celebrity-backed vetures in the cryptocurrency landscape.
Renowned Afro-pop sensation, Davido, has faced blowback from the Nigerian crypto community due to his handling of his newly established meme token, DAVIDO. Many are suspicious that a token dump might be on his near-term agenda. Lookonchain revealed that Davido earned a significant profit of 2,783 SOL (around $473,000) in a mere 11 hours of selling his DAVIDO meme coin after its introduction on May 29. He still holds an unrealized gain of $207,000.
The star initially invested 7.5 SOL (approximately $1,275) and then utilized 7 SOL ($1,190) to create and launch his DAVIDO token on the platform pump.fun, buying 203 million DAVIDO tokens, which correspond to 20.3% of the total supply, as confirmed by Lookonchain, a blockchain monitoring company. The firm also reports that he transferred 20 million DAVIDO to “dead1111...1111,” and still holds 61.12 million DAVIDO ($207,000).
Despite his lack of public response, Davido's sizable withdrawal from his DAVIDO token inventory while promoting its purchase has spurred widespread critique from his followers and the crypto community. Rume Ophi, a Nigerian crypto specialist, argues that a better strategic move would have been for Davido to call for regulatory transparency and exchange licensing in the country's crypto sector, instead of launching his own token. Ophi suggests that Davido’s memecoin might just be a pump-and-dump scheme, threatening the industry’s reputation and potentially triggering SEC investigation. Direct efforts to reach Davido for his comments on the matter proved unfruitful.
Considering Davido's massive appeal, this action could expose a substantial number of his followers, who may be novice in cryptos, to significant financial risk and heighten regulatory pressure on valid crypto operations.
One distressed user regrets that Davido along with his team failed to let the fresh memecoin gather steam, suggesting more profits could have been made with a more strategic launch.
The user proposed that Davido's team should have let the token gain traction and increase in worth rather than selling such a large amount of the token (nearly $500,000) right after its debut. @Toobbss, another user, claimed that Davido has a past of unloading tokens on his fans, pointing to this as the second time in three years, leaving his fans to shoulder the losses.
In 2021, Davido championed RapDoge before offloading over $300,000 on his supporters.
These activities by Davido in the crypto sphere arise amid the growing popularity of celebrity meme assets. Pop star Iggy Azalea recently launched her token, MOTHER. These celebrity-led cryptocurrency launches, however, have sparked debates, leaving investors vulnerable to potential pump-and-dump schemes, which can lead to financial setbacks.
In related news, a leak revealed the celebrity price list for a meme coin 'mastermind' involving Caitlyn Jenner.
Published At
5/30/2024 3:39:48 PM
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