Solana’s Memecoin Chaos Deepens as LIBRA Debacle Sparks Investor Fears
Solana’s native token, SOL, has been on a downward spiral, sliding against both the U.S. dollar and ether (ETH) as the latest memecoin scandal shakes the ecosystem.
In a report published Monday, Galaxy Research described the alleged rug pull of LIBRA as yet another damaging event for Solana’s speculative memecoin market.
Market confidence had already begun to wane following the January launch of the TRUMP token, which absorbed liquidity and rattled investors. The LIBRA fallout threatens to accelerate this trend, reducing interest in SOL-denominated assets that have fueled the network’s recent growth, the report warned.
Galaxy analysts pointed out that SOL’s surge in recent months was heavily driven by memecoin speculation. However, the token has struggled since LIBRA’s launch, dropping 8.6% in the past 24 hours to $168.73 at the time of writing.
Meanwhile, LIBRA has caused political turmoil in Argentina, where President Javier Milei is facing impeachment threats after endorsing the token as a small business support tool. LIBRA briefly reached a $4.5 billion market cap before plummeting by 90%, sparking outrage among investors.
“The LIBRA incident is just the latest sordid chapter in Solana’s memecoin mania, which has been in decline since TRUMP’s peak valuation of $75 billion in January,” wrote Alex Thorn, head of firmwide research at Galaxy.
Kelsier CEO Hayden Davis, the creator of LIBRA, admitted that he and his team launched both LIBRA and MELANIA tokens while also sniping their own contracts upon deployment.
“This wasn’t a rug pull,” Davis insisted in an interview with crypto whistleblower Coffeezilla. “It was a strategy that went completely off the rails, leaving me in control of $100 million with no clear way forward.”
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