On-chain investigator ZachXBT has raised concerns about crypto exchange Kraken’s decision to list the Memecore token, pointing to $7.9 million in suspicious withdrawals linked to the platform.
In a detailed X post on Monday, the investigator questioned how the asset passed due diligence when large volumes were moved from exchange-linked wallets to newly created addresses shortly after listing.
$7.9M in withdrawals and concentrated holdings
According to the analysis, funds tied to Memecore were routed through Kraken deposit addresses before being dispersed across 18 fresh wallets. The wallets collectively hold around 11.7 million tokens, now valued at nearly $40 million.
The activity traces back to a wallet believed to be associated with the Memecore team, which received a significant allocation at the token generation event and later transferred millions of tokens to exchange-linked addresses.
Listing scrutiny centers on due diligence
ZachXBT’s criticism focuses on whether exchanges are adequately vetting projects with concentrated ownership structures. He pointed to Memecore’s limited circulating supply relative to its total issuance, arguing that such setups can amplify price volatility.
The token briefly reached a market capitalization of around $6 billion, despite limited publicly demonstrated usage beyond launchpad activity and incentivized campaigns.
Insider control raises market integrity questions
The investigator claims insiders and early holders control more than 90% of Memecore’s supply, a structure that can allow a small group to influence pricing. He has previously highlighted similar patterns in other tokens, describing them as prone to sharp reversals once liquidity shifts.
His comments also questioned whether any fundamental metrics justify the project’s fully diluted valuation, given the disparity between circulating supply and headline market cap.
RaveDAO collapse adds context to concerns
The scrutiny comes days after the collapse of RaveDAO, which saw its token lose more than 95% of its value within 24 hours following allegations of insider-driven flows.
ZachXBT had flagged similar issues in that case, including high insider concentration and large transfers to exchanges ahead of the price peak. The episode has intensified attention on low-float, high-valuation tokens and the role of exchanges in listing them.
Broader questions for exchange listings
Kraken has not publicly addressed the specific allegations tied to Memecore. The exchange has previously emphasized its commitment to client protection and compliance in listing decisions.
The episode highlights ongoing tensions between rapid token listings and the risks posed by opaque ownership structures, particularly in segments of the market driven by speculative demand rather than demonstrated utility.
Also Read: RaveDAO’s 6000% Pump Turns Into 95% Crash, Wiping $6B in 48 Hours
