Yzy Token reached a market capitalization of $3 billion, but fell to $1.05 billion.
Arthur Hayes blames Izzy Token.
Connor Grogan said insiders hold 94% of the supply on Yzy.
Ye, a world-renowned hip-hop artist well known as Kanye West, has launched his official code, $yzy. According to Nansen data, within just 40 minutes of release, Yzy token reached a market capitalization of $3 billion, but quickly returned to $1.05 billion. Despite the hype, analysts on the chain raised the red flag.
Is Yzy legal? Analysts claim it is suspicious
West recently launched the token carefully after refusing to promote fake currency for $2 million in February. However, crypto experts quickly pointed out the threat of potential insider trading risks.
Bitmex co-founder Arthur Hayes was reportedly acquired by Token and considered it a short-term investment. However, the feelings didn’t last long as he denounced the code. He said, “Don’t let X replace a sitter like oopsie…fam next time, $yzy. I had to keep two stepping.”
Coinbase experts check insider trading on Yzy
Coinbase director Conor Grogan said insiders have 94% of the supply and one wallet will first control 87% before distributing it to others.
“At least 94% of the new Kanye Tokens are insider-owned. 87% of the new Kanye Tokens were owned by a single Multisig (now spread across multiple wallets).” Grogan said.
“3%+ was purchased in a single transaction of size by various (prepared) wallets at the open market,” he added.
Blockchain analytics firm Lookonchain said, “Several insider wallets prepared their funds in advance and quickly purchased $YZY.
Mixed reactions from traders
One trader spent $24,000 on Solana’s preferred expenses to secure a $3.4 million profit, while another pocketed $6 million with Peak. But not everything was lucky. One user accidentally bought the wrong contract and lost around $710,000. Luckily, users later recovered some losses by purchasing the correct contract.
This highlights the extreme volatility and risks associated with tokens. It also shows substantial insider benefits reported during the launch phase of the YZY token.
