Kanye's YZY Crypto Crash Leaves 60,000 Wallets in Red

Over 60,000 unique wallet addresses that participated in the trading of the YZY token, a cryptocurrency linked to rapper Kanye West, have recorded losses, accounting for more than 83% of the total address count involved in the token’s trading activity. The data, drawn from blockchain analytics platforms such as Nansen and Bubblemaps, reveals the extent of the financial impact suffered by retail investors following a rapid price surge and subsequent collapse of the token. Despite the losses, a small group of insider wallets reportedly generated substantial profits in the days following the token's launch on Solana on August 21, 2025.

YZY initially saw a dramatic price surge of over 1,400% within an hour of its launch, peaking at $3 before plummeting by 74% within less than 24 hours. The token's value continued to decline, reaching $0.77 and later stabilizing at $0.56 as of the latest reports. The sharp decline triggered widespread criticism from the crypto community and raised concerns over market manipulation and the fairness of the token launch. Nansen reported that more than 56,000 wallets interacted with the token, and over 27,000 wallets still held balances of more than $1 at the time of analysis. However, out of the first 99 wallets to buy YZY, only nine retained any holdings.

A detailed breakdown of the losses indicates that one wallet alone suffered an unrealized loss of over $1.8 million, with another wallet recording a loss of $1.2 million. According to Nansen, the top 10 wallets extracted more than $18 million from the token's launch, underscoring the uneven distribution of gains and losses among participants. Bubblemaps identified Hayden Davis, a co-founder of the previously controversial LIBRA token project, as one of the key figures behind a coordinated sniping operation that generated over $12 million in profits. Davis's involvement, including access to recently unfrozen USDC funds from a court ruling, raised further questions about potential market manipulation and insider trading.

The launch of YZY followed a pattern similar to other celebrity-driven tokens, where a small group of traders or insiders capitalized on early access and rapid trading strategies. This phenomenon, known as a "pump and dump," typically results in substantial losses for the broader retail investor base. According to Bubblemaps and independent on-chain analysts, over 90% of the YZY token supply was controlled by insiders or the project team. This level of centralization, combined with high transaction fees and limited transparency, fueled widespread skepticism and regulatory concerns. The token’s smart contract allowed the creator to mint additional tokens or disable sales, further heightening the risk of a "rug pull," where liquidity is drained, and investors are left with valueless assets.

The YZY token’s performance also had a ripple effect on other related crypto projects, including Yeezy Coin (4NBT) and Swasticoin, which saw declines of over 88% and 78%, respectively. These declines were attributed to confusion and allegations of scams within the broader Yeezy Money ecosystem. The YZY launch was also accompanied by a security breach of Kanye West’s Instagram account, which led to the promotion of a fake token under the name “yzytoken.” This incident further eroded trust among investors and contributed to the token’s volatility. Analysts and blockchain sleuths continue to investigate the involvement of key figures and patterns across celebrity-driven crypto projects to better understand the risks and potential regulatory responses to such schemes.

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