Kanye West YZY Token Hits $3B, Dips After Insider Allegations

Key Takeaways

• Rapper Kanye Wests newly launched YZY token on the Solana network surged to a $3 billion market cap in just 40 minutes before falling by more than two-thirds amid insider trading allegations.

• On-chain analysts have flagged several red flags, including a liquidity pool containing only YZY tokens and a single multisig wallet holding a massive 87% of the initial supply, which has been distributed to other wallets.

• Despite concerns from on-chain observers, some prominent crypto whales and traders have bought the dip, viewing the token as a short-term, high-risk play similar to other celebrity memecoins.

The world of celebrity-endorsed memecoins has seen a new entrant, and its already following a familiar and controversial trajectory. Rapper Kanye West, who goes by Ye, launched the YZY token on the Solana blockchain with the promise of “A NEW ECONOMY, BUILT ON CHAIN.”

The tokens launch was explosive, with its value skyrocketing to a $3 billion market capitalization in under an hour. However, the initial euphoria was short-lived.

YZY Money

A swift and massive price correction, which has wiped out more than two-thirds of the tokens value, has followed, largely due to concerns over alleged insider trading and a suspicious token distribution model.

On-Chain Red Flags and Suspicious Activity

Crypto market observers and on-chain analytics firms like Lookonchain and Onchain Lens were quick to point out significant red flags.

Stay safe boys

— legen ???????? (@legen_eth) August 21, 2025

One of the primary concerns revolves around the tokens liquidity pool, where only YZY tokens were added. In a typical decentralized exchange (DEX) setup, a token is paired with a stablecoin like USDC to provide a balanced trading environment.

ye(@kanyewest) launched the $YZY token. Note:

Only $YZY was added to the liquidity pool with no $USDC.

Dev may sell $YZY by adding/removing liquidity, similar to $LIBRA.

Multiple insider wallets prepared funds in advance and immediately bought $YZY.

Insider wallet 6MNWV8 knew…

— Lookonchain (@lookonchain) August 21, 2025

By not doing so, the creators maintain the ability to manipulate the price and liquidity at will. This setup is a classic sign of potential “rug pull” schemes, where developers can drain the liquidity and abandon the project.

By my estimation, at least 94% of the new Kanye token is insider owned

-87% of the new Kanye token was owned by a single multisig (now dispersed to multiple wallets)

-3%+ was bought in a single transaction, with size, by assorted (prepared) wallets at market open

-7%+ in LP

— Conor (@jconorgrogan) August 21, 2025

Furthermore, Coinbase Director Conor Grogan revealed that before being distributed, an astonishing 87% of the token supply was held in a single multisig wallet.

This guy clearly had insider info about @kanyewest launching a token—but only part of it.

He bought the wrong $YZY and lost $710K!

40 minutes ago, he spent 761K $USDC on the real $YZY, and now sits on a profit of over $710K — making back his loss

— Lookonchain (@lookonchain) August 21, 2025

A multisig (multi-signature) wallet requires multiple private keys to authorize a transaction, a feature often used by projects for enhanced security.

However, in this case, its use prior to distribution raised suspicions of a highly centralized and controlled launch, with one entity having near-total control.

Despite Concerns, Whales Are Still Buying

Even with the blatant red flags, the allure of a celebrity-backed token has not been lost on everyone.

Ye (@kanyewest) launched his own $YZY token on @solana.

A whale spent 12,170 $SOL, worth $2.28M, to buy 2.67M $YZY and transferred it to another wallet.

Currently, these $YZY are valued at $8.29M, resulting in a profit of $6M.

Note: The liquidity pool was populated solely with…

— Onchain Lens (@OnchainLens) August 21, 2025

Several well-known crypto traders and “whales”—large-scale holders—have reportedly bought into the token, viewing it as a short-term, high-risk, high-reward play.

An insider spent 450K $USDC to buy 1.89M $YZY at $0.24 via 2 wallets, then sold 1.59M $YZY for 3.37M $USDC at $2.12.

He still holds 303,425 $YZY($510K), with a profit of over $3.4M (+760%).

To ensure he got in first, one wallet even paid 129 $SOL($24K) in priority fees.…

— Lookonchain (@lookonchain) August 21, 2025

Leverage trader James Wynn, for instance, stated that he “aped” into the token on a 60% pullback, citing the massive growth of President Donald Trumps eponymous memecoin as a reason for his investment.

Aped $YZY on a 60% pull back. $TRUMP ran from $4bn to $15bn in 28 hours. 4x

This coin might not be of much interest to the brokies of CT, but its of interest to whales because they can move 7 figures in and out with this kind of liquidity and volume.

I'll just be trying to…

— James Wynn (@JamesWynnReal) August 21, 2025

The presence of large-scale traders suggests that while the initial rally was retail-driven, the next phase may be defined by speculative bets on future pumps fueled by market liquidity and volume.

Pls don't rug me @kanyewest !!!$YZY for the win … cause bull market.

Yachtzee

— Arthur Hayes (@CryptoHayes) August 21, 2025

Final Thoughts

The YZY token launch is a stark reminder of the volatile and often risky nature of the memecoin market. While a celebrity‘s endorsement can drive a torrent of initial hype and investment, it doesn’t guarantee a fair or sustainable project.

— Coffeezilla (@coffeebreak_YT) August 21, 2025

The on-chain red flags point to a highly centralized and potentially manipulated launch, but the markets response demonstrates that speculation, not fundamentals, remains the primary driver of these assets.

Frequently Asked Questions

What is a “multisig” wallet？

A multisig wallet is a cryptocurrency wallet that requires multiple private keys to authorize a transaction, offering an extra layer of security and shared control over funds.

What is an “insider trading” concern in memecoins？

It refers to the illegal practice where individuals with non-public information about a projects launch or distribution use that information to buy in early and make a profit by selling at a higher price to the public.

Why is a liquidity pool with only one token a red flag？

A liquidity pool with only one token, instead of a token and a stablecoin, can be a red flag for a “rug pull” because it allows developers to manipulate the price and drain the liquidity at any time.