Author: 1912212.eth, Foresight News
A LIBRA meme coin takeover game has caused a stir in the crypto community. On February 15, the Argentine president announced the launch of the LIBRA meme coin, which then skyrocketed in value, reaching a market cap of over $4 billion at one point. However, in less than a few hours, its price plummeted significantly, and the current price is $0.36, with a market cap of less than $400 million. The Argentine president deleted his tweets promoting the meme coin just hours after posting them, stating that he "thought it would be like before, just casually supporting a private startup project unrelated to him. He was not aware of the details of the project and will absolutely not promote it further (which is why he deleted the tweets) after understanding it."
Investors who were the first to participate in the on-chain meme rush suffered heavy losses. Solayer developer Chaofan Shou and Tonykebot lost over $2 million in this practice and publicly revealed the list of core members of the KIP Protocol team behind LIBRA, vowing to pursue accountability. According to lmk.fun's monitoring, based on transaction records, a total of 24 traders lost over $1 million on LIBRA, and 61 traders lost over $500,000. The biggest loser realized a loss of $5.17 million, having spent $5.6 million to purchase 2.1 million tokens, only to sell them for $430,000. In contrast, 8 wallets associated with the LIBRA team managed to cash out approximately $107 million through adding liquidity, removing liquidity, and collecting fees, obtaining 576,000 USDC and 249,671 SOL (around $49.7 million).
The insider trading, celebrity influence promotion, and takeover game of meme coins have once again become the focus of market attention.
Today, Paridigm researcher Samczsun, Solana co-founder Toly, and crypto KOL Cobie discussed their views on Twitter.
Conspiracy Groups and KOLs
Samczsun initiated the discussion by asking whether the event would hold some parties accountable on a social level.
Toly's response was pessimistic, as "social group trials are a problem in themselves, as they are a passive reaction to the outcome, not based on a pre-set and recognized set of rules." Attackers can endlessly generate failed tokens, become the sole bidders, acquire most of the supply, and then transfer the contract address to KOLs. In Toly's view, the only solution is to force users to have a social credit score and reject tokens with low scores.
Samczsun further asked that if meme coins controlled by insiders are bad, why not formally exclude all participants? In the short term, the benefits of one-time profiting would not outweigh the cost of being excluded, and in the long run, such behavior would not be profitable at all.
Toly's answer was simple and direct: when KOLs promote contract addresses, they will be ostracized by their fan groups, and the conspiracy group will then turn to the next KOL.
Cobie stated that many KOLs don't even know who they're dealing with or what they're posting. They are just told by their agents that if they promote it, they will receive X tokens.
If KOLs and their agents are told about something clearly bad, will the KOLs be held accountable for their actions? We often see that multiple insider trading and fraud cases in certain tokens do not result in any form of punishment.
Toly believes that "the reputation of some KOLs has indeed been affected, partly because: 'How do you define good and bad in meme coins? Even with a completely free market token distribution, the top 20% of holders will end up with over 80% of the tokens.'"
Cobie then frankly explained that there is currently no effective way to shame the shameless. He then posted a long Twitter thread to elaborate on his views.
"This situation has existed long before meme coins, basically since I first got involved in the crypto industry. (The recent operations are just more efficient and obvious.) Whenever someone is shamed, they use it as populist rhetoric to their advantage, and some even become more popular as a result. The accused will just accuse others in return, creating a confrontation. For example, some YouTubers have been promoting scams for three consecutive cycles, and despite constant exposure, they remain very popular. The cyclical nature of the crypto industry means that there will always be new entrants to fill the void left by old users, so these people can always find new audiences."
Lack of Truth and Regulation in the Market, Often Ending in Nothing
In Cobie's view, the only people he's seen truly shamed to the point of leaving the industry are either those who were relatively reputable but made mistakes, or those who don't need to make money in this industry. Those who should really be expelled already know what they're doing and have made their choice. Exposing them does not make them feel ashamed, but only threatens their income, so they will fight back. And without a "truth arbiter," the arguments often have no final conclusion.
Cobie also stated that it may take more than five years for the public to truly recognize human nature, and that's only if they make obvious mistakes in the process.
"If fraudsters are not threatened with losing their freedom, it is almost impossible to prevent them from continuing to defraud."
The Takeover Game Faces an Unsolvable Dilemma
Regarding the current controversy over high-valuation VC tokens and the fast-paced issues in meme coins, Cobie made a sharp comment, stating that the current market trajectory is that market participants eagerly rush into these scams like moths to a flame, with most knowing they are scams, but aiming to sell to the next bag holder at 3 times the price. They only want to get rich in 2 weeks, not 2-4 years. Players hope they can also hit the jackpot in the next move.
If there is no way to stop them, the best option may be to avoid participating.
Cobie stated that investor/player behavior is easily changed. If you lose 10 times, you'll stop playing the game. No one buys VC tokens anymore, in fact some (very, very few) of them are mispriced. They no longer buy these tokens because they are tired of being exploited.
Cobie had previously written about VC tokens with high FDV and low liquidity, but he was disappointed that his efforts did not achieve the desired goal and did not prevent the public from buying these tokens. The only way to change investor behavior is for participants to lose enough. It is only after experiencing the pain that this group can truly realize that they should avoid participating.
Cobie wrote, "This in turn changes the behavior of token issuers, as the public will no longer buy these products, so you can no longer easily issue this type of token."
Finally
If you were to launch a token echo now and had to choose between two paths:
(1) Sell 25% to VCs and insiders, retain 35% for the team, and launch a token that receives revenue distributions from Echo's business to holders, with low liquidity;
(2) Sell 0% to anyone, retain 50% yourself, and launch a meme coin called "Echo the Racist Dolphin" that has no connection to Echo other than the name, deployed from your public wallet and tweeted about through a CA account;
Which one do you think would have a higher market cap? Cobie's answer is that the meme coin's value (at least for now) would be higher than the VC token. But if you repeat the same experiment in 5 years, the result would be the opposite.
Interestingly, in Cobie's comment section, there was a helpful commenter who asked which of the two tokens mentioned was the one being discussed.
Cobie said he would release the contract address in 25 minutes, and Toly commented: Do you have any face?
Cobie responded that it was just a joke, and joked about Toly using Buterin's title (V God's name).
