Nigerian Afro-pop sensation Davido’s handling of his newly introduced meme token, DAVIDO, has sparked criticism within the local crypto community. Many express concerns that a token dump might be imminent.
Following its launch on May 29, Davido reportedly profited significantly, earning 2,783 SOL ($473,000) within just 11 hours by selling his DAVIDO memecoin, according to Lookonchain. The singer still holds an unrealized profit of $207,000.
Davido’s Token Launch
Davido initially invested 7.5 SOL (equivalent to $1,275) and utilized 7 SOL ($1,190) to create and debut his DAVIDO token on the pump.fun platform, acquiring 203 million DAVIDO tokens, constituting 20.3% of the total supply.
Additionally, he transferred 20 million DAVIDO tokens to the address “dead1111…1111,” retaining 61.12 million DAVIDO ($207,000).
Community Response
While Davido has refrained from addressing the matter, both his fans and the crypto community have voiced widespread disapproval over his sizable withdrawals from his DAVIDO token reserves, juxtaposed with his encouragement for people to invest.
Local crypto expert Rume Ophi suggests that Davido could have pursued a more strategic approach by advocating for regulatory clarity and exchange licensing in Nigeria’s crypto sector, rather than launching his own token.
Ophi warns that Davido’s memecoin runs the risk of devolving into a pump-and-dump scheme, jeopardizing the industry’s integrity and inviting scrutiny from regulatory bodies like the SEC.
Given his substantial following, many of whom may lack experience in cryptocurrencies, Davido‘s actions could potentially result in widespread financial losses and intensified regulatory scrutiny on legitimate market participants.
One disappointed user expressed dissatisfaction with Davido and his team’s failure to allow the new memecoin to gain traction, suggesting that a more strategic approach could have yielded even greater returns.
Summary Review: Davido‘s foray into the cryptocurrency space with the launch of his meme token, DAVIDO, has stirred significant debate and concern within the Nigerian crypto community. While the singer has reaped substantial profits from the token’s sale, criticisms abound regarding his perceived lack of transparency and the potential risks associated with his actions. The controversy surrounding Davido’s token launch underscores broader issues within the cryptocurrency industry, including the prevalence of pump-and-dump schemes and the need for regulatory clarity. As Davido’s sizable following includes many individuals new to cryptocurrencies, there is a heightened risk of financial harm and regulatory scrutiny if the token‘s value were to plummet. Moving forward, it remains to be seen how Davido and his team will address the community’s concerns and navigate the regulatory landscape. Ultimately, this incident serves as a cautionary tale about the importance of responsible engagement within the cryptocurrency space and the potential consequences of unchecked speculation and investment behavior.
Disclaimer: Remember that nothing in this article and everything under the responsibility of Web30 News should be interpreted as financial advice. The information provided is for entertainment and educational purposes only. Investing in cryptocurrency involves inherent risks and potential investors should be aware that capital is at risk and returns are never guaranteed. It is imperative that you conduct thorough research and consult with a qualified financial advisor before making any investment decision.
