Kanye West continued his controversy-filled era with his YZY token launch on Solana this week, where trading activity drove its market capitalization near $3 billion before collapsing within hours.
The token, listed under multiple pool tickers on Raydium, initially saw rapid inflows that pushed its fully diluted valuation into multibillion territory before prices retreated more than 90%, leaving its capitalization closer to $137 million.
The pace of YZY’s ascent and reversal mirrored past episodes in the Solana ecosystem where memecoins generated substantial liquidity in compressed windows. As Barron’s noted, the debut quickly shifted discussion toward whether these launches, often tied to well-known public figures, warrant more oversight as traders with early access capture profits at the expense of late entrants.
On-chain monitors cited wallets that accumulated large allocations at market open. Independent analysis from Conor Grogan estimated that as much as 94% of the initial supply was controlled by insiders, including a single multisig wallet that at one point held 87% of the tokens before dispersing.
Fee structures added another layer to the controversy. As one trader posting under the handle 0xBiZzy observed, the YZY pool was configured with a 1% base fee and dynamic adjustments that quickly moved to 2.68%, combined with a wider bin step that introduced another 4 to 5 percent of slippage.
The effect left some participants facing an estimated 10% round-trip cost to enter and exit positions. Despite these costs, volume surged in the first hours of trading, producing more than $9 million in collected fees for the pool’s operators, according to the same account.
Market activity revealed uneven outcomes for traders. Lookonchain tracked one whale wallet that spent 1.55 million USDC to purchase just under one million YZY tokens at $1.56, only to sell them two hours later at $1.06 for 1.05 million USDC, realizing a
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Author: Liam ‘Akiba’ Wright
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