Lionel Messi Promotes Eco-Friendly Meme Token

Argentinian football legend Lionel Messi is promoting a Solana-based meme coin called WaterCoin (WATER) through his Instagram stories.

Messi is now shilling solana memecoins. Via his Instagram stories. This is wild. pic.twitter.com/qbr6Vk7yum

— Alex Krüger (@krugermacro) July 8, 2024

According to the documentation, the project has an environmental focus.

“WATER will conduct global marketing and social campaigns, attracting billions of views to water-related issues, and announce partnerships with the world’s largest charitable organizations and decision-makers,” the description states.

The project’s roadmap is divided into four main stages: “Rain,” “River,” “Sea,” and “Ocean.” These include the token’s presale, listing on centralized exchanges, celebrity partnerships, and transforming the coin into a “charitable ecological currency” with global acceptance.

Analysts at Lookonchain noted that the start of WaterCoin trading on DEX Raydium and Jupiter in June was accompanied by unusual fund movements in the developer’s wallet. It transferred 844.44 million WATER to 11 new wallets that did not participate in the presale. Subsequently, these addresses received more than 18,600 SOL ($2.35 million) from dumping the coin.

Soon after launch, the token’s price plummeted, prompting economist and trader Alex Krüger to label the asset a “true shitcoin.” He attributed the price drop to insider dumping.

However, on July 8, the WaterCoin rate recovered to levels near $0.0009.

SEC Likely to Scrutinize Meme Token Promotions

Celebrities who have created and promoted meme coins on Solana may have violated securities laws and are “certain to attract attention” from the SEC. This is according to Cointelegraph, citing legal experts.

Since late May, tokens with their own images have been released by well-known figures such as Caitlyn Jenner, Iggy Azalea, and Jason Derulo.

“Nothing will make the SEC act faster than the sale of a meme coin,” said Creo Legal founder David Chang.

He believes the regulator could hold Jenner and others accountable for selling unregistered securities.

Liam Hennessy, a partner at law firm Clyde & Co, agreed with this conclusion. He recalled that during the previous price surge, celebrities were already penalized for illegal cryptocurrency promotion. Kim Kardashian paid a total of $1.26 million in fines, interest, and restitution for promoting the altcoin EthereumMax (EMAX). Former Boston Celtics star Paul Pierce’s involvement in the coin’s promotion cost him $1.4 million.

Celebrity meme coins were issued on the Pump.fun platform, and the creation of assets for Caitlyn Jenner (JENNER) and Jason Derulo (JASON) involved notable figure Sahil Arora.

Analytical firm Bubblemaps noted that all tokens, including Mother Iggy (MOTHER) by Azalea, which Arora was not involved with, were subject to insider activity at launch. Some wallets made millions of dollars in profits, experts highlighted.

3/ Before Jason Derulo’s first tweet, we spotted huge clusters on the $JASON bubble map

• #1 holder: 11%
• Red cluster: 18%
• Yellow cluster: 22%https://t.co/bbDC7iCJgr pic.twitter.com/jZgqlXDw2y

— Bubblemaps (@bubblemaps) June 24, 2024

Jenner and Derulo accused Arora of deception in the token creation process. However, Arora previously stated that the American singer’s attacks were “completely orchestrated.”

Chang noted that issuing a token is a “key event of responsibility” for creators, and “attempting to distance oneself from it makes sense.”

“If it can be proven that a celebrity coordinated their actions with Arora and staged a fake public feud, it will provide no legal protection,” the lawyer added.

The market capitalization of MOTHER fell from a June peak of $148.9 million to $34.1 million — a 77% drop (CoinGecko). Prices for JENNER and JASON have lost 41.2% and 45.3% respectively over the past seven days.

Lawyers noted that besides the SEC, celebrities should be wary of investor claims.

“If enough people lose their money, we could easily see a class action lawsuit. The vast majority of meme coin projects eventually fizzle out, so I expect nothing different here,” Chang stated.

For the 2023 fiscal year, the SEC collected $4.9 billion from 784 enforcement actions.