Wolf Memecoin Crashes 99% Amid Insider Trading Concerns

The creator of the Libra (LIBRA) token, Hayden Davis, has launched another memecoin, the wolf (WOLF) memecoin, which has experienced a dramatic 99% crash in value. The new memecoin, launched on March 8, was based on rumors that Jordan Belfort, known as the Wolf of Wall Street, was planning to launch his own token. The WOLF memecoin reached a peak market capitalization of $42 million but quickly plummeted to just $570,000 within two days.

According to blockchain analytics platform Bubblemaps, 82% of the WOLF token’s supply was controlled by a single entity, raising concerns about insider trading. The platform revealed that transfers were made across 17 different addresses, all stemming back to an address owned by Davis. This pattern was similar to that of the HOOD token, another memecoin launched by Davis, which also experienced significant insider trading activity.

Davis' latest token launch comes on the heels of 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 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.

Memecoins are increasingly being used to exploit retail investors, turning against crypto’s fundamental ethos of decentralization. According to Anastasija Plotnikova, co-founder and CEO of a blockchain regulatory firm, memecoins have evolved from community-driven social experiments into a chaotic landscape dominated by value extraction from retail investors. Insider rings, pump-and-dump schemes, and sniper groups have replaced the organic, collectible nature of original memecoins, creating an unhealthy playing field.

Investors 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. These activities should fall firmly within the jurisdiction of law enforcement agencies. United States regulators are becoming increasingly aware of the growing memecoin scams, with a New York lawmaker introducing a bill that would establish criminal penalties specifically aimed at preventing cryptocurrency fraud and protecting investors from rug pulls.