Bubblemaps analysts accuse creator of celebrity meme tokens of fraud

What’s new? Experts at blockchain analytics platform Bubblemaps have published an investigation into entrepreneur Sahil Arora's fraudulent activity in launching celebrity meme tokens, which allowed him to earn about $30 million in 2024. The exchange rates of most of the coins that Arora was involved in launching have subsequently collapsed to zero.

Source: X.com

What else is known? Arora has collaborated with celebrities such as Caitlyn Jenner, Iggy Azalea, Jason Derulo, Amber Rose, Sunny Leone, Bobby Althoff, Trippie Redd and Lil Pump.

According to researchers, Arora has been active in the crypto space for at least the last 7 years. Back in 2017, at the age of 18, he founded Vuzelaa Group in his native India to install bitcoin ATMs around the world, and between 2020 and 2023, he launched more than a dozen crypto projects.

Among them, experts highlighted the ZelaaPayAE debit cryptocurrency card and the ZelaaNFT non-fungible token marketplace — despite the failure of both projects, Arora made significant profits.

Then, as Bubblemaps noted, the entrepreneur turned his attention to the Solana blockchain-based Pump.fun platform, where anyone can launch their own token for less than $2.

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“With his large Instagram audience and verified checkmark, Sahil realized that greedy celebrities would accept almost any deal. For a large payment, all he asked them was to tweet the contract address of a token,” Bubblemaps wrote.

For example, singer Jason Derulo was offered $200 000 for such a tweet.

Since Sahil, as the organizer of the issue, owned almost the entire supply of tokens, soon after the publication of tweets, he dumped the assets, using fans of celebrities as an outlet for liquidity, leaving the latter with devalued tokens on hand. This approach is similar to the fraudulent Pump&Dump scheme. At the same time, he did not even try to hide and openly shared information about his profits in a publicly available Telegram channel.

Analysts found more than 40 addresses associated with Arora. For each token, he held a 25-40% supply at one or more addresses, and on the wave of excitement, exchanged them for Solana (SOL) tokens and sent them to his main address. These funds he then deposited into centralized exchanges (CEX).

According to Bubblemaps analysts, at some point he would launch new tokens on Pump.fun every day, attracting new celebrities. Although thousands of fans lost their money as a result, Sahil's actions remain in a gray area, making him difficult to prosecute. The entrepreneur currently resides in Dubai, where the Virtual Asset Regulatory Authority (VARA) operates.

“Even the celebrities aren’t going after him because they are partly responsible,” the experts concluded.

That said, Iggy Azalea's Mother Iggy token (MOTHER) is still among the top 5 coins in the Pump.fun ecosystem in terms of market capitalization with a value of over $40,3 million, according to data from aggregator CoinGecko. However, it has lost 13,2% overnight, with a weekly drop of 25,8%.

Anonymous blockchain researcher ZachXBT, known for publishing about fraud and hacks in the crypto space, argued with Bubblemaps. Relying on the liquidity data of tokens created by Arora, ZachXBT suggested that he only made around $2-3 million dollars.

Source: X.com

Earlier, Ethereum blockchain co-founder Vitalik Buterin criticized celebrity coins, noting that they are not useful and are aimed only at enriching the creators and early investors.

In August, the creators of the popular Hamster Kombat tap-to-earn game for Telegram announced that they had rejected all offers of venture capital funding to ensure the long-term development of the project. They explained that venture capitalists could use real players as exit liquidity, leaving the latter with depreciated coins.