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Libra's $4B crash spurs memecoin safety calls

Libra's $4B crash spurs memecoin safety calls

Grafa2025/02/18 09:40
By: Mahathir Bayena
SOL-0.06%JUP-0.13%BEN0.00%

Following the collapse of the LIBRA (CRYPTO:LIBRA) meme coin, Pump.fun founder Alon (CYYPTO:ALON) is urging the implementation of safeguards for token launchpads. 

He has called for industry-wide standards. 

The concerns arise after the LIBRA meme coin, briefly endorsed by Argentine President Javier Milei, experienced a rapid decline.

Insiders allegedly siphoned off $107 million, resulting in a $4.4 billion wipeout in market capitalisation within six hours. 

Following the incident, there has been widespread speculation about potential market manipulation and concerns regarding insider activity. 

Alon expressed "disgust" over the incident, prompting calls for better protection for users.

According to Binance, insiders withdrew $107 million, causing the coin’s value to crash and wiping out over $4 billion from its market cap within just a few hours.

Alon defended Pump.fun, arguing its design protects against insider-controlled launches.

However, they also emphasised the necessity for better education for users, improved onboarding processes, and reduced visibility for tokens displaying suspicious trading patterns.

Meanwhile, Ben Chow, the co-founder of Meteora, has resigned due to a "lack of judgment and care" related to the project.

However, both Chow and Meow, another Meteora co-founder, denied any wrongdoing by Meteora or Jupiter (CRYPTO:JUP).

Binance noted that the rapid surge and subsequent collapse of LIBRA serves as a cautionary tale.

This serves as a cautionary tale, highlighting the volatile nature of meme coins and the importance of thorough research and risk management.

Bubblemaps data revealed concentrated insider activity, with 82% of LIBRA tokens held in a single cluster.

The LIBRA team extracted $107 million total, with eight wallets accumulating 57.6 million USDC and 249,671 SOL ($49.7 million) through liquidity manipulation and fee claims.

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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