Hayden Davis, the CEO of Kelsier, has ignited considerable controversy by admitting his role in creating the LIBRA and MELANIA meme-coins. His team sniped both tokens right at their launches, which sparked renewed discussions regarding insider trading in cryptocurrency.
The situation became even more complex when Davis refunded $5 million to Barstool Sports founder Dave Portnoy, while other investors faced substantial losses.
Hayden Davis Thoughts Libra
LIBRA was launched on a Friday and marketed as a cryptocurrency aimed at supporting small and mid-sized businesses in Argentina. Initially, it gained traction with an endorsement from Argentine President Javier Milei, who later deleted his tweet. However, after Milei withdrew his support, the token suffered a staggering 95% decline, leaving many investors in distress. In defense of the project,
Davis insisted it was “a plan gone miserably wrong,” contending that $100 million was still under his control. He stated that sniping, which involves using automated bots to purchase tokens immediately upon release, is a common practice in the industry.
MELANIA’s Role
Davis’s involvement with MELANIA, a memecoin linked to First Lady Melania Trump, has also drawn scrutiny. Initially, he denied taking any liquidity from MELANIA. However, after an investigation into on-chain data, he clarified that there is a distinction between liquidity swaps and liquidations. MELANIA debuted with an impressive $2.1 billion market cap on January 20, but it has since dropped to approximately $625 million.
Allegations of Insider Trading
The controversy intensified when Portnoy revealed that he had prior knowledge of LIBRA’s launch and received a substantial refund from Davis. This admission raised significant concerns about preferential treatment and potential insider trading. However, Davis dismissed these allegations, arguing that early access and structured deals are commonplace in both the crypto and traditional business sectors.
As these developments unfold, the crypto community grapples with pressing questions about ethical implications surrounding high-profile meme coin launches. The scrutiny surrounding Davis’ actions emphasizes the urgent need for increased transparency and integrity within the industry as investors seek to navigate the complexities of the memecoin landscape effectively.
