The newly launched YZY token by Kanye West quickly caught attention but raised concerns about its safety and market viability among investors.
Rapid Rise and Sharp Pullback
The YZY token was presented through the Yeezy Money website and promised to be the foundation of a new blockchain-based financial system. Within 40 minutes of launch, its market capitalization soared to $3 billion before dropping to $1.05 billion amid volatility concerns. Investors rushed in despite warnings about risks, comparing it to the TRUMP memecoin, which had a significant price increase earlier this year.
Insider Control Raises Red Flags
The YZY token's price quickly fell due to concerns about concentrated supply. Analysis revealed that insiders controlled about 94% of the circulating supply, raising fears of market manipulation. The token's high concentration allowed developers to easily adjust liquidity, exposing buyers to sudden dumps. As a result, several insiders made multimillion-dollar profits in the first hour by exploiting priority fees and early access.
Broader Concerns About Celebrity Tokens
The YZY launch adds to the growing skepticism about tokens promoted by celebrities and politicians. Earlier this year, Argentina's President Javier Milei briefly endorsed the LIBRA token before retracting support, leading to a crash. Donald Trump's token also faced controversy despite posting massive short-term gains.
The launch of Kanye West's YZY token illustrates the instability and challenges faced by celebrity-promoted tokens and highlights the importance of careful analysis before investing.
