Davido, the Afro-pop star, has faced backlash from the Nigerian crypto community regarding his management of his recently launched meme token, DAVIDO. There are concerns within the community that he may be planning to dump the token.
Reports from Lookonchain indicate that Davido made a significant profit of 2,783 SOL ($473,000) within just 11 hours by selling his DAVIDO memecoin following its launch on May 29. Despite this profit, the singer still holds an unrealized profit of $207,000.
Davido's debut of Memecoin
Davido created and launched his DAVIDO token on the pump.fun platform with 7 SOL ($1,190), which he used to buy 203 million DAVIDO tokens, or 20.3% of the total supply, after receiving an initial investment of 7.5 SOL ($1,275).
He also sent 20 million DAVIDO to "dead1111...1111," according to the blockchain tracking company, leaving 61.12 million DAVIDO ($207,000) remaining.
Community Response
Davido hasn't said anything about it, but the cryptocurrency community and his supporters have harshly criticized him for taking large amounts of DAVIDO tokens out of his hoard while urging people to purchase.
Local crypto expert Rume Ophi has criticized Davido, suggesting that instead of launching his own token, he could have advocated for regulatory clarity and exchange licensing in Nigeria's crypto space. Ophi warned that Davido's memecoin risks being perceived as a pump-and-dump scheme, which could damage the industry's credibility and attract scrutiny from regulatory bodies like the SEC.
With a large following, many of whom may lack experience in cryptocurrencies, Davido's actions could potentially cause widespread financial harm and increase pressure on legitimate players in the crypto space.
Some users expressed disappointment in Davido's handling of the token launch, suggesting that he and his team could have allowed the memecoin to gain momentum and increase in value instead of selling a substantial amount immediately after its launch, which amounted to nearly $500,000. This sentiment was echoed by another user, @Toobbss, who pointed out Davido's history of dumping digital coins on his fans, citing a previous incident with RapDoge in 2021 where he reportedly dumped over $300,000 on his followers.
Davido's entry into the cryptocurrency world coincides with a trend of celebrity-backed meme assets, with Iggy Azalea recently launching her own token, MOTHER. However, these celebrity-driven cryptocurrency launches have faced criticism for potentially exposing investors to pump-and-dump schemes, leading to financial losses.
May 2024, Cryptoniteuae