The launch of memecoin Pond0x has led to millions of dollars in losses for investors, according to multiple reports on social media on July 28. Data from the Maestro trading app shows that the Pond0x (PNDX) token reached a price of $0.36 before collapsing to near zero in a span of five minutes.
- The launch of Pond0x resulted in significant losses for investors, with the token’s value plummeting to near zero within minutes.
- The token was announced by Jeremy Cahen, founder of Not Larva Labs, on July 28.
- There was confusion surrounding the launch as users expected it to take place on Uniswap, while it was actually conducted through a web app.
- Users lost thousands, and in some cases millions, of dollars due to the sudden drop in value.
- Investors reportedly lost over $2.2 million in the launch.
- There are claims that the token’s transfer function is faulty, allowing users to transfer coins from any other user.
- A new version of PNDX is being created to compensate victims through a community coin.
- Memecoins, such as Pond0x, have gained popularity in recent years, with Dogecoin being one of the first to make waves in 2013.
- This incident adds to the growing number of memecoins causing frenzy in the cryptocurrency market.
The launch of Pond0x was announced on July 28 by Jeremy Cahen, the founder of Not Larva Labs who is better known by his Twitter username “Pauly.” Not Larva Labs is the developer of a nonfungible token trading app for CryptoPunks and for a separate parody collection called CryptoPhunks. It is not associated with Larva Labs, the creators of CryptoPunks.
The web app contained a Pepe meme graphic, similar to the ones used in successful memecoins like Pepecoin (PEPE). The app allowed users to mint new PNDX tokens in exchange for a fixed amount of Ether (ETH), similar to a presale or fundraiser. However, many users expected the fundraiser to be done on Uniswap, and the listing of both the website and the contract address in the same post caused confusion, according to social media reports.
Some users purchased the token on Uniswap through bot trading apps like Maestro or Unibot, increasing its price. Meanwhile, other users minted tokens using the web app and sold them into the market at a profit.
Users who lost crypto complained they had lost thousands or even millions of dollars. According to a report from memecoin holder Rune, investors lost over $2.2 million in the launch.
Another user reported that PNDX has a faulty transfer function that allows users to transfer coins from any other user. Blockchain data shows that the transfer function for the coin is unusual. Instead of containing a line of code that updates the user’s balance, it calls a separate “brutalized_” function.
About two hours after the initial post, Rune provided an updated report that stated a new version of PNDX is being created by the person who originally drained the money from investors. According to Rune, the new project will provide a “dashboard” to compensate victims through a “community coin.”
Memecoins, or coins associated with a viral internet image or video, first came to prominence with the launch of Dogecoin (DOGE) in 2013. They remain popular today.
Update (July 29, 04:32 am UTC): This article has been updated to disclose the identity of “Pauly” as Jeremy Cahen.
