Behind the Solana Celebrity Token: A feast for project parties and rat trading

Author: M7 Research Source: X,@m7_research

Recently, with the issuance of $TRUMP by Trump on the Solana chain, a wave of celebrity coin issuance frenzy has been set off. Tokens such as $MELANIA, $RYAN, $ENRON, and $LIBRA have successively appeared, and the Meteora platform has rapidly become the preferred issuance platform for such high-profile projects. These token projects exhibit astonishing similarities: extremely high FDV, exaggerated trading volume, and drastic price fluctuations. At first glance, these tokens are sought after in the market due to the celebrity effect, but a deeper analysis reveals that this is actually a carefully designed mechanism for harvesting wealth.

Meteora Platform: Innovative mechanisms are reduced to tools of manipulation

The Meteora platform is favored for its DLMM model, which has lower slippage and flexible liquidity management mechanisms. However, these innovative features aimed at improving capital efficiency have been improperly exploited, becoming tools for project parties and insider traders to profit.

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The mode of operation of systematic manipulation

In a typical celebrity token offering, the project team usually takes the following steps:

• Create tokens in advance
• Set up a pool of DLMM transactions on Meteora
• Inject trading liquidity

It is observed that project parties often create DLMM pools of tokens and USDC trading pairs in advance, and only inject unilateral liquidity. This means that at the opening of the market, a large number of limit sell orders have been preset waiting for liquidity to pour in, and the zero slippage of DLMM trading bins further amplifies the profit space of the project party.

Insider trading analysis: precise timing and system operation

$MELANIA, $ENRON, $LIBRA and other cases, the insider trader has the contract address (CA), trading pool information and opening time in advance. The specific performance is as follows:

• $LIBRA tokens are created on the 14th, and trades are created 20 minutes before the market opens on the 15th
• $ENRON Tokens were created on January 25 and the Meteora pool was not set up until an hour before the transaction on February 4

According to GMGN data, nearly $4.5 million poured into $LIBRA in just 2 seconds after it opened.

A trader (address: 8bZsrR5aRHDZYkWPLQoDFZUKsHCTeJ8uqhPnoMn7baG3) grabbed the top spot with a single $1.4 million sniper trade, and the account initiated 170 trades in the opening block until the moment the trade opened. Considering that there are pools on Meteora that only add one-sided liquidity on a daily basis, it is clear that such a large amount of precision investment is due to insider information.

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A detailed explanation of the profit model

The sniper trader has adopted a systematic profit strategy:

1. Quickly convert 1.8 million tokens into $530,000
2. Disperse the remaining tokens into 8 sub-accounts for distribution

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Take the largest sub-account (DmzEMt7XHwA1tZM5d1XBGvTFWoUpTLutpR5d8cMxNghs) as an example: 750,000 tokens are sold every 20 seconds, 14 consecutive operations.

The remaining tokens were added to the $LIBRA-$SOL trading pair as single-sided liquidity, harvesting 5,500 SOL after just 7 minutes.

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Convert all LIBRA and earned SOL to USDC within 5 hours of the market opening, making a profit of $5 million.

In the end, the sniper account made a total profit of 17 million US dollars through this batch dumping method.

At the same time, the project party's profits are even more considerable. The developer address (DefcyKc4yAjRsCLZjdxWuSUzVohXtLna9g22y3pBCm2z) also uses the one-sided liquidity mechanism to add tokens to the Meteora pool, with fee income alone reaching 10 million dollars.

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Market Impact & Alerts

While $LIBRA cases have attracted attention for their high attention, they all present similar operating patterns from $ENRON, $MELANIA to $RYAN. Investors unwittingly fall into the "celebrity + Meteora + big truck" trap of money harvesting. The high liquidity mechanism of the Meteora platform has been abused by project parties and insider traders, which has seriously overdrawn the liquidity and investor confidence of the cryptocurrency market.