Industry voices warn that politically recognized cryptocurrencies must adopt stronger investor protection and liquidity guarantees to prevent another major market crash.
Investor sentiment remains shaken after the Libra token recognized by Argentina President Javier Milei, suffering a $4 billion loss in market capitalization due to insiders’ cash.
At least eight insiders, according to blockchain analytics firm DWF Labs Wallet withdraws $107 million in liquiditytriggering a massive crash.
Source: Kobeissi Letter
To avoid similar collapses, tokens with presidential approval will require stronger security and economic mechanisms, such as liquidity locking or making tokens in liquidity libraries unsold for pre-selling periods, DWF Labs wrote in a report with CoIntelegraph.
The report notes that the tokens of high-profile leaders also need to be launched restrictions to limit the participation of cryptobots and large holders or whales.
“Restricting robots and whale activity is crucial to limiting the impact on individuals who are internally informed,” said Andrei Grachev, managing partner at DWF Labs.
“The program must strive to launch as fairly as possible so that all participants have equal opportunities to ensure distribution and not be disadvantaged by a handful of funded or informed players claiming to be a share of the supply of the Lions.”
Source: DWF Laboratory
According to a report by DWF Labs, the Libra scandal caused 74,698 traders to lose $286 million worth of cumulative capital.
Grachev said the rapid collapse of Token further illustrates the need for liquidity lockdown, “to ensure users have enough liquidity to buy and sell without high slips.”
“This is especially valuable at the token release stage at high volatility, ensuring that there is sufficient liquidity to meet large transactions without significant price impact.”
DWF Labs’ report is one week later New York lawmakers introduced In the latest Memecoin scam, legislation aimed at protecting crypto investors from carpets and internal fraud.
Related: Under the leadership of the new SEC
More transparency required token release
Grachev of DWF Labs explained that the collapse of Libra tokens illustrates the need for a more transparent token startup mechanism.
“That includes wallet transparency before launch and due diligence on the launch board.”
“When launching any token, there is always a certain degree of risk, which is not easy to completely mitigate,” he said.
He added: “Nevertheless, by carefully examining the projects they work with and taking full advantage of the transparency of one of the core features of blockchain, LaunchPads can enable users to make smarter decisions.”
Related: Memecoins: From social experiments to retail “value extraction” tools
Some disturbing developments have emerged since the memorial factors recognized by the Argentine president collapsed Libra is an “open secret” In some Memecoin circles, these circles realize that the token was launched for up to two weeks.
Milei has asked the Anti-Corruption Office to investigate potential misconduct by all members of the government, including the president. according to By February 16, a statement issued by the Argentine Presidential Office.
Milei’s phone call facing each other After endorsing cryptocurrency from his political rivals, it turned into a $100 million carpet.
https://www.youtube.com/watch?v=6unogDvqwre
Magazine: Caitlyn Jenner Memecoin’Stertmind’s “Celebrity Price List Leaks
