The Creator of the Libra (LIBRA) Token Has Launched Another Memecoin

The creator of the Libra (LIBRA) token has launched another memecoin with some of the same concerning onchain patterns that pointed to significant insider trading activity

Hayden Davis, the creator of the Official Melania Meme (MELANIA) and the Libra (LIBRA) tokens, has launched another Solana-based memecoin, with over 80% insider supply.

Davis launched the Wolf (WOLF) memecoin on March 8, capitalizing on rumors of Jordan Belfort, known as the Wolf of Wall Street, launching his own token. The token reached a peak $42 million market cap, however, 82% of the WOLF token’s supply was bundled under the same entity, according to a March 15 X post by Bubblemaps, which wrote:

Source: Bubblemaps

The blockchain analytics platform revealed transfers across 17 different addresses stemming back to address ‘OxcEAe’ owned by Davis.

“He funded these wallets months before $LIBRA and $WOLF launched, moving money through 15 addresses and 2 chains,” Bubblemaps adds.

Source: Bubblemaps

The Wolf memecoin lost nearly 99% of its value within two days, from the peak $42.9 million market capitalization on March 8 at 4:00 a.m. UTC, to just $570,000 at press time, according to data from screener.

WOLF/SOL, market cap, 1-hour chart. Source: Dexscreener

Davies’ latest token launch comes weeks after the Libra token’s collapse where eight insider wallets cashed out $107 million in liquidity, leading to a $4 billion market cap wipeout within hours.

The Libra token also turned into a political issue, with Argentinian President Javier Milei risking impeachment after his endorsement of the Libra coin.

Argentine lawyer Gregorio Dalbon has asked for an Interpol Red Notice to be issued for Davis citing a “procedural risk” if Davis remained free as he would have access to vast amounts of money that would allow him to either flee the U.S. or go into hiding.

Related: Milei-endorsed Libra token was ‘open secret’ in memecoin circles — Jupiter

Memecoins are turning into ‘retail value extraction tools’

Memecoins are now going against crypto’s fundamental ethos of decentralization, becoming increasingly used to exploit retail investors amid the growing number of rug pulls, according to Anastasija Plotnikova, co-founder and CEO of blockchain regulatory firm Fideum.

“Memecoins have evolved from community-driven social experiments into a chaotic landscape dominated by value extraction from retail investors and an exploitation of new technologies like Web3 and the metaverse,” Plotnikova told Cointelegraph, adding:

Investors will also need to distinguish between memecoins that can be seen as genuine “collectibles” and “outright fraudulent activities” like rug pulls which are “not only unethical but also clearly illegal, with case law to support enforcement.”

“In my view, these activities should fall firmly within the jurisdiction of law enforcement agencies,” she added.

United States regulators are becoming increasingly aware of the growing memecoin scams.

A New York lawmaker has introduced a bill that would establish criminal penalties specifically aimed at preventing cryptocurrency fraud and protection investors from rug pulls, as part of an effort to expand the state’s financial crimes statutes, according to a March 6 report by Law360.

Under the proposal, new criminal charges would be created for offenses involving “virtual token fraud,” explicitly targeting deceptive practices associated with cryptocurrencies.