Quick Take:

• Niche celebrities launch tokens on Solana’s Pump Fun app, sparking debate in the crypto community.
• Early buyers profit significantly, raising concerns about token distribution and sustainability.
• Celebrities like Caitlyn Jenner, Iggy Azalea, Trippie Redd, and Davido join the trend, but not all tokens perform well.

Celebrities jumping on the crypto bandwagon isn’t a new phenomenon. However, the recent surge of tokens launched on Solana’s Pump Fun app by various niche celebrities has stirred up quite the buzz in the crypto community, raising questions about the purpose and sustainability of these projects.

Profitable Early Hoarding: Early buyers of these celebrity-backed tokens have reaped substantial profits, with some tokens yielding six-figure returns in a remarkably short period. However, the distribution of these profits has raised eyebrows, as blockchain data indicates that a select group of traders accumulated the majority of token supplies before the celebrities promoted them on their platforms.

For example, a single address reportedly acquired over 70% of Trippie Redd’s BANDO token shortly after its launch, distributing the tokens to nearly 190 other wallet addresses. Similarly, Nigerian record producer Davido’s DAVIDO token saw early investors pocketing nearly $470,000 worth of Solana’s SOL tokens in just 11 hours, from an initial capital of just over $1,000.

Controversies Surrounding Celebrity Tokens: While some tokens saw significant profits, controversies emerged surrounding the legitimacy and intentions behind these projects. Davido, in particular, faced allegations of promoting scams in the past, such as RapDoge, Echoke, and Racksterli, an investment ponzi scheme. Critics argue that such ventures undermine the credibility of the crypto space and suggest that celebrities are primarily interested in extracting profits with minimal effort.

Iggy Azalea’s MOTHER Token: Not all celebrity tokens have seen the same level of success. Iggy Azalea’s MOTHER token, despite reportedly generating $2 million in profits for early traders, experienced a significant price drop of 70% since its launch. Bubblemaps, a data tracking firm, highlighted that a small group of wallets had acquired 20% of the token’s supply before Azalea’s promotion.

The Debate Continues: The influx of celebrity-fueled meme coins on Solana has reignited the debate about the role of celebrities in the crypto space and the sustainability of such projects. While some celebrate the democratization of finance and the potential for wealth creation, others caution against the risks of speculation and the concentration of token ownership among a select few.

As the crypto community navigates through these developments, one thing remains clear: the allure of quick profits continues to attract attention, but the long-term viability and impact of celebrity-driven token projects are still up for debate.

Easy issuance, easy money

All of these celebrity-promoted tokens were launched on Solana token generator Pump Fun. These tokens are automatically listed on the decentralized exchange Raydium after a certain trading volume is met.

DEXTools data shows most of these tokens ran to market capitalizations of as much as $25 million in the hours after issuance, racking up tens of millions in trading volumes. However, all of them have been down more than 50% since highs – a sign of selling pressure amid the hype.

The first of these celebrity tokens was Jenner’s which sowed confusion among market observers as its legitimacy was questioned due to past celebrity X account compromises.

Jenner’s X profile has continued to promote the token, although CoinDesk has not received confirmation of her involvement in the token despite multiple messages to her official media inquiry department.

While issuing tokens is not a harmful activity by itself, crypto market participants are criticizing how these celebrities have seemingly emerged out of the woodwork in an easy environment, making quick money from unsuspecting followers. Some have described this as a “net negative” for the industry.