"Avoid the Meme Trend," CZ Cautions as Odd Golden Statue Memecoin Plummets by 86%

‘Don’t buy the meme,’ warns CZ, as bizarre golden statue memecoin crashes 86%

Changpeng Zhao, known as CZ and the founder of Binance, has issued a warning to cryptocurrency investors about the purchase of a new memecoin launched in his name. The coin's rapid decline in value raises concerns about the viability of such tokens, which often lack real utility.

Key Takeaways

Binance's founder, CZ, cautions against purchasing a newly launched memecoin associated with a statue of himself.
The memecoin's price fell by 86% shortly after its launch.
Over 15% of the memecoin's supply is held by an unfamiliar wallet, indicating possible insider trading.
Memecoins generally rely on social momentum for value, making investment outcomes unpredictable.

CZ Advises Caution on "Golden Statue" Memecoin

Changpeng Zhao, popularly known as CZ and the founder of Binance, has urged crypto investors to steer clear of a recently launched memecoin that uses his image. This warning follows the emergency of the coin, which was created to leverage CZ's popularity, yet implies higher financial risks associated with trading tokens linked to celebrities without genuine utility.

The peculiar memecoin appeared shortly after a fan constructed a golden statue of Zhao, sharing images online and even offering to present it to him, the head of the world’s largest cryptocurrency exchange.

On a social media post made on Wednesday, CZ warned users not to invest in the memecoin related to the statue, asserting that the creation of this token suggests that its developers were merely trying to make fast money from their connection with him. Zhao expressed his appreciation for the gesture but stressed that he finds the existence of a meme coin of this nature concerning. “I don’t appreciate this. Don’t buy the meme,” he stated.

Source: Changpeng Zhao

Rapid Decline of the Zhao-themed Memecoin

The launch of the Zhao-themed memecoin proved to be a poor investment for its holders. The CZ STATUE (CZ STATUE) memecoin saw its price decrease by an alarming 86% just hours after its market cap soared to $5.10 million around 10:00 AM UTC on Wednesday, according to the analytics platform Nansen.

CZSTATUE/WBNB, all-time chart. Source: Nansen

Adding to the concerns about the memecoin, over 15% of its total supply is being managed by a newly created cryptocurrency wallet, which raises red flags about potential insider dealings and indicates poor tokenomics.

CZSTATUE token distribution score. Source: Nansen

Even though many BNB memecoins have managed to create new millionaires among cryptocurrency traders, this lucrative trend faced a severe setback during a major liquidation event, where around $19 billion was wiped from the market. This downturn has dampened the speculative enthusiasm surrounding such tokens.

Memecoins often depend heavily on social trends for their gains, making it uncertain whether investors will see any return on their investments. For instance, an astute crypto trader, at the beginning of October, transformed a $3,000 investment into an astonishing $2 million after an earlier social media post from Zhao boosted a BNB-native memecoin's value significantly, as reported by Cointelegraph.

Magazine: Crypto traders ‘fool themselves’ with price predictions — Peter Brandt