Iggy Azalea, the popular Australian rapper, is the latest celebrity to endorse a new meme coin and pump it like there’s no tomorrow via her social media accounts.

The seamless experience provided by the Pump.fun protocol to mint this type of digital asset is prompting more and more public figures to take advantage of the hype by using their influence on millions of followers to make some money.

However, the movement has faced controversies, scams, and fraud attempts, including actions by a crypto promoter named Sahil Arora, who allegedly defrauded Caitlyn Jenner and tried to do the same with Azalea. Here’s a summary of what has occurred with the $MOTHER token since it started.

The MOTHER Token: The Beginning of Iggy Azalea’s Crypto Adventure

Launched in late May, the $MOTHER token has already harnessed significant interest from the crypto community as speculators keep rushing through the doors to capture the latest hyped-up digital asset in the meme coin space.

The launch of this token was controversial from the start because insiders bought 20% of its total supply. This drew criticism from crypto fans, who saw it as Azalea trying to help a small group of early supporters (mostly herself). Holding a large amount of a token, especially a meme coin, means you can crash its price by selling your share, causing others to lose money.

Azalea responded to these comments by saying that she was not attempting to cause any distortions in the process and that she valued the support of her fans. To demonstrate her commitment, she hired a development team that would help her navigate the intricacies and complexities of minting and promoting a new digital asset fairly.

iggy azalea mother token skyrockets in just a few days
$MOTHER price chart – Source: CoinMarketCap

The rapper’s approach seems to have paid off. In the past 7 days alone, the price of the token has moved from $0.019 to $0.091 resulting in mind-blowing gains of 378.9% in just a week according to data from CoinMarketCap.

However, reports from decentralized exchanges indicate that some investors made even more money as the token traded at $0.004 at some point, implying that some early birds reaped some handsome rewards exceeding 2,100% in a matter of days. The token’s market cap currently stands at $90.4 million with a self-reported circulating supply of 990 million $MOTHER coins.

It’s certainly possible that $MOTHER continues to climb in value from here, especially if Azalea or other celebrities promote it through their social media accounts. If you’re considering buying some, make sure to watch Azalea’s Twitter for more promotions. But there’s also a decent chance that Azalea or another insider dumps their tokens on the open market, crashing the price of the coin forever.

The Dark Side of Celebrity Tokens: Fraud and Manipulation

While some celebrity-endorsed tokens like MOTHER have seen impressive gains in relatively short periods, the trend has a dark side that investors must consider. The rise of these digital assets has been accompanied by allegations of fraud and market manipulation.

At the center of this controversy is Sahil Arora, a crypto promoter with a questionable reputation. Arora first made the headlines when he helped deploy Caitlyn Jenner’s meme coin $JENNER. However, an impasse between the two prompted Jenner to accuse him of stealing “lots of money”.

Undeterred by the situation, Arora quickly moved on to his next target: Iggy Azalea.

The promoter used a Telegram group he runs, named XO, to tease that he was partnering with Azalea to push forward a new token via the Pump.fun platform. He provided his followers with a Solana wallet address that they could pour money into to participate in the upcoming presale of the token.

Although the response was quite modest in the beginning, with only 100 wallets sending money to Arora’s wallet, the presale ultimately attracted over 1,000 crypto investors – based on the number of wallets that sent money to Arora’s venture – and harnessed a total of $380,000 worth of crypto deposits.

Arora minted a new token on Pump.fun called IGGY token and promised that Azalea would endorse it. However, his plans fell apart when the rapper used her social media to discredit Arora and the IGGY token.

“Don’t disappoint your mother,” the rapper posted, followed by her MOTHER’s token address. She then directly addressed Arora: “Sahil baby, take your L and go already.” In a Twitter Spaces session, Azalea revealed that after researching Arora’s background, she and her manager decided to proceed without him.

In just an hour, the market cap of the IGGY token dropped dramatically from $1.4 million to barely $160,000 as Azalea’s fans dumped the asset following her decision to part ways with Arora.

Despite the fallout, Azalea seems more invested than ever in the crypto space as portrayed by her decision to display a new profile picture (PFP) minted exclusively for her by Mad Lads. This collection of non-fungible tokens (NFTs) has gained significant traction lately and has even surpassed the trading volumes of well-established digital collections including a handful of Bored Apes.

Why are Celebrities Minting Meme Coins?

Despite the risks, more celebrities are jumping on the meme coin bandwagon lately. This trend is particularly evident on the Solana blockchain, which has become a hotspot for creating this type of digital asset.

In May alone, nearly half a million tokens were created on Solana, far outpacing other networks like Ethereum and BNB Chain. This surge is attributed to Solana’s low transaction fees and high throughput, making token creation as simple as publishing content on the internet.

Last month, around half a million tokens were created in the Solana blockchain. This network has already surpassed others like Ethereum and the BNB Chain in this specific metric.

The blockchain’s low fees and capacity to process transactions rapidly despite significant congestion have made it the go-to infrastructure for new tokens in the web3 space.

Austin Federa, head of strategy at the Solana Foundation, explained to CoinPaper: “Solana is built to be a general-purpose layer 1, with fast finality and high throughput with extremely low transaction fees.”

“The rise of mass token creation on Solana is downstream of these characteristics, bringing the cost of experimentation and new idea creation to near zero.”

The Role of Pump.fun

A significant factor in this trend is the rising popularity of the Solana-based Pump.fun protocol, a website that allows users to create digital assets in just a few clicks. This platform has democratized token creation, leading to the launch of 1.1 million new tokens on Solana just this year.

Pump.fun has been the preferred launchpad for political meme coins and, notably, celebrity tokens. Aside from Azalea, prominent public figures like Caitlyn Jenner and musician Davido have launched their own Solana-based tokens and have successfully leveraged their large fan bases to boost the visibility and value of these assets.

“The meme coin mania plus the success of Pump.fun has made Solana the current leading blockchain to launch new tokens. It is still to be seen whether Solana can capture the mindshare of token launches beyond meme coins,” commented Steven Zheng, director of research for The Block Pro.

The Risks Involved for Investors and Celebrities Should Not be Underestimated

While the potential for quick gains is alluring, the risks associated with celebrity-endorsed meme coins are significant.

Some of these risks include low liquidity, significant market volatility, the potential for market manipulation, copyright infringements, intellectual property (IP) or trademark violations, and reputation risks for celebrities if things don’t go as planned.

In the case of Azalea, allocating 20% of the total supply of the $MOTHER token to insiders represents a huge legal risk as regulators could allege that these individuals engaged in insider trading as they were aware that Azalea would soon pump the asset via her social media accounts.

One wallet named “Invincible” was among the most notable to reap the rewards of Azalea’s involvement with $MOTHER as it bought 10% of the token’s total supply right before she announced the endorsement.

According to data from Bubblemaps, this wallet alone made a staggering profit of $1.4 million from these transactions while other wallets bought a combined 8% stake that ended up netting them $800,000.

Moreover, the involvement of shady characters like Sahil Arora in the promotion of these assets increases the risk of pump-and-dump schemes and rug pulls. Investors should be aware that, without explicit endorsements, there is no assurance that a meme coin will be promoted by a specific celebrity, even if the name, nickname, or artistic name is part of the token’s ticker symbol.

Even if the coin is promoted by a celebrity or multiple celebrities, there is a high chance that insiders will dump their tokens and you will lose money.

To sum up, the world of celebrity meme coins is a high-stakes game where fortunes can be made or lost in a matter of hours. Iggy Azalea’s MOTHER token, despite its controversial start, has seen remarkable gains, turning her into a favorite within the crypto community in just a matter of days.

Her hands-on approach and commitment to seeing the digital asset succeed offer some hope that not all celebrity tokens are mere cash grabs.

However, the saga involving Sahil Arora and his attempts to exploit Caitlyn Jenner and Iggy Azalea delivers a stark warning that not every offering is as trustworthy as it seems.

The ease with which meme coins can be created on platforms like Solana and Pump.fun has democratized access to the crypto market but it has also opened the floodgates for scam artists and fraudsters.