Whereas most exit scams or rug pulls consequence within the collapse of a undertaking, Solana-based memecoin Catwifhat (CIF) managed to outlive two of them, illustrating how crypto’s decentralized nature can generally enable a undertaking to proceed even when its developer disappears.
In a dialog with Cointelegraph, Catwifhat investor NFT_Sloth claimed that the undertaking survived two rug pulls over 12 days, but nonetheless has a devoted group behind it right this moment.
First, the undertaking’s founder allegedly dumped their tokens into the open market just a few hours after launch on Dec. 12, 2023, cashing in 20% of WIF’s provide for 3.86 SOL (SOL) (value roughly $265 on the time) and pulling most of its liquidity. Regardless of this setback, the remaining buyers shortly took over the undertaking, forming a brand new dev staff to advertise the token. Consequently, CIF recovered to a market cap of greater than $4 million by Dec. 23, simply 11 days after it had been rugged.
However then, the token’s largest liquidity supplier rugged the undertaking once more on Dec. 24, eradicating 92% of its liquidity and tanking the worth by roughly 76%. Regardless of struggling additional losses, the token’s dev staff restructured but once more and continued to work on the undertaking. As of April 3, its market cap sits at roughly $1.4 million. The 200 million tokens the founder bought on launch day can be value over $250,000 right this moment had they held.
Catwifhat precursor reached a $3 billion market cap
In line with NFT_Sloth, Catwifhat was created to observe within the footsteps of Solana memecoin Dogwifhat (WIF), which launched in November 2023. This earlier token was created to benefit from the “Dogwifhat” meme that had grown widespread on the X platform since 2019.
In line with meme historical past website Know Your Memes, the Dogwifhat meme got its begin on Nov. 6, 2019, when skilled Fortnite participant Issa quickly modified his profile image on X to a picture of a Shiba Inu canine carrying a beanie hat. Different Fortnite gamers additionally modified their profile pics to the picture shortly afterward, claiming they had been making a Dogwifhat “motion” or “gang.”
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The next month, X customers started to edit the photograph in numerous methods and repost it to X, inflicting the meme to unfold all through the platform shortly.
In November 2023, a staff of crypto builders tried to capitalize on this phenomenon by making a token related to it. In line with NFT_Sloth, members of the Dogwifhat group despatched pictures to numerous memecoin influencers on X. They took the influencer’s profile image and edited it, including the beanie from the Dogwifhat meme.
Considered one of these influencers was “Joji,” who used an Azuki nonfungible token as their profile image. They had been despatched a picture of this Azuki with the beanie on its head, permitting them to specific assist for the token by this altered profile image. Joji started selling Dogwifhat on their Telegram and X channels, and the token shortly gained recognition.
Catwifhat launches and developer dumps tokens
As informed by NFT_Sloth, Catwifhat was one of many first memecoins trying to observe within the footsteps of Dogwifhat. Nevertheless, the developer of the undertaking allegedly executed an exit rip-off mere hours after it launched.
In line with the Solscan block explorer, the developer of Catwifhat minted 1 billion tokens in the mean time of creation on Dec. 12, 2023, all of which had been despatched to the deployer account. From there, they sent 10% of the provision (100 million CIF) to an account starting with Fm1w and one other 10% to an account starting with AUKt. The remaining 80% (800 million CIF) was deposited right into a liquidity pool on the Raydium decentralized trade. These 800 million tokens had been paired with 1 SOL, setting an preliminary value of 0.00000000125 SOL ($0.000000085675) per CIF.
Nevertheless, the token had no advertising and marketing on launch day. The developer deployed the token’s contract and listed CIF on DEX Screener however made no additional try to draw consumers. Regardless of this lack of selling, the token attracted some consumers who noticed it on DEXScreener as a result of its related title to Dogwifhat, NFT_Sloth claimed.
Blockchain knowledge exhibits that at 9:41 am UTC on Dec. 12, the account starting with Fm1w sold all 100 million of its tokens into the liquidity pool, receiving 1.24 SOL (roughly $85 on the time) in trade. Two minutes later, the account starting with AUKt additionally sold its cash, receiving 2.62 SOL ($180) in trade.
At 9:56 am, the deployer account removed its share of the liquidity pool. By the point it did this, the entire CIF within the pool had been bought, inflicting the deployer to obtain solely SOL from its withdrawal. As well as, as a result of the earlier two transactions had crashed the worth, the deployer acquired solely 0.00203928 SOL ($0.14) from its withdrawal.
This alleged exit rip-off netted the developer roughly $265 value of SOL in complete.
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Catwifhat group takes over
After the primary developer bought their tokens and eliminated liquidity, buyers had been left with basically nugatory tokens. Nevertheless, NFT_Sloth says that a number of giant buyers determined to maintain pursuing the undertaking. They fashioned a staff to take over its promotion. He claims that Joji additionally joined the staff throughout this time and commenced selling Catwifhat to his Telegram and X audiences. This led some “alpha callers,” speculators who make public bets on memecoins, to more and more make calls in favor of Catwifhat, finally bringing much more buyers into its group.
After the primary developer exited, inflicting excessive slippage for merchants. But in the course of the first 10 days after launch, a single CIF investor managed to purchase up over 55 million tokens and deposit them into the Raydium liquidity pool, offering sufficient provide for merchants to maintain buying and selling. On the time, this investor’s share of the liquidity pool represented roughly 92% of its complete worth locked. Additionally they grew to become a social media supervisor for the brand new staff and had entry to its official X account. This centralization in liquidity finally led to the second “rug pull,” NFT_Sloth claimed.
The undertaking will get “rugged”… once more
In line with NFT_Sloth, this social media supervisor revoked his personal entry to the staff’s X account on Dec. 24 and instantly afterward eliminated his liquidity. The consequence was a catastrophic slide within the token’s value. The present improvement staff alleges that this motion was a “liquidity rug pull,” he claimed, as the one who acted was a member of the staff and managed an extreme quantity of the pool’s liquidity.
NFT_Sloth claimed that the staff’s Telegram group and web site admin additionally went silent after this occasion, offering additional proof of an exit rip-off.
Blockchain knowledge exhibits that at 7:57 pm UTC on Dec. 24, two transactions from an account starting with CWSy had been confirmed. The primary removed practically 102 million CIF and 1,630 SOL from the Raydium liquidity pool. The second removed roughly 55 million CIF and 869 SOL.
Information from this time shows an enormous slide in value for CIF. In line with CoinGecko, the token peaked at $0.00431771 on Dec. 23, with the worth being recorded because the day started at midnight. This means that the token had a market cap of over $4.3 million originally of that day. By the beginning of Dec. 24, the worth had fallen to $0.00261692 and the market cap to $2.6 million, a decline of roughly 40%. At this level, the alleged rug pull had not but occurred.
The following value level recorded is initially of the next day, 4 hours after the alleged rug pull had occurred. At that second, CoinGecko knowledge exhibits a CIF value of $0.00098130, implying a market cap of $981,300 and a decline of 76%.
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Catwifhat regroups but once more
Regardless of this second “rug pull,” the staff reportedly regrouped once more. NFT_Sloth stated he constructed a brand new web site for the undertaking whereas one other investor, whom he refers to as “Sam B,” launched a brand new Telegram group. The previous web site was finally taken offline for unknown causes.
NFT_Sloth additionally credited X consumer Cryptochristo with respiratory new life into the CIF group. They reportedly spent “ten hours a day” selling the coin after becoming a member of the group, which helped to supply the general public with new consciousness of the undertaking.
He acknowledged that some members of the group are engaged on an NFT market that may use CIF as its native token, offering CIF with utility. Nevertheless, NFT_Sloth additionally argued that memecoins shouldn’t be judged totally on their utility. “In all honesty, the utility facet of meme tokens is sort of just like the unsexy facet,” he acknowledged. “Individuals are in it for the LOLs for probably the most half.” He claimed that Catwifhat’s final purpose is to “transcend out of the memecoin little bubble” and achieve “mainstream” adoption, just like Dogecoin (DOGE).
As of April 2, CIF has a value of $0.001451 and a market cap of $1,451,116. The 200 million tokens that the developer reportedly bought for $265 on launch day are actually value roughly $290,000, based on CoinGecko knowledge.
The story of Catwifhat provides some hope for victims of rug pulls, as buyers had been reportedly in a position to recuperate from the losses brought on by these occasions. Nevertheless, most victims of different tasks haven’t been in a position to recuperate from these occasions. In Might 2023, rug pulls drained over $45 million from victims, greater than the quantity drained from decentralized finance exploits. Since April 2023, greater than $35 million has been stolen from over 42,000 victims in rug pulls, based on safety platform Blockfence.
