The launch of memecoin Pond0x (PNDX) resulted in millions of dollars in losses for investors, according to multiple social media reports on July 28. Data from trading app Maestrobots shows the token hit a price of $0.36 before crashing to near zero. within five minutes.
The launch of Pond0x was announced on July 28 by pseudonymous Not Larva Labs founder “Pauly”, who is only known by his username X. Not Larva Labs is the developer of an NFT trading application for CryptoPunks and a separate collection of parodies called “CryptoPhunks”. It is not associated with Larva Labs, the creators of CryptoPunks.
In the announcement, Pauly provided the contract address for PNDX and the URL of its official web application.
Welcome to Pond0x https://t.co/iSiwpRDrix • $PNDX
— PAULY (@Pauly0x) July 28, 2023
The web app contained a Pepe meme graphic, similar to those used in successful memecoins like PepeCoin. The app allowed users to create new PNDX tokens in exchange for a fixed amount of Ether (ETH), similar to a presale or fundraiser. However, many users expected the fundraiser to be done on Uniswap, and listing the website and contract address in the same post caused confusion, according to social media.
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Some users bought the token on Uniswap through robot trading apps like Maestrobots or Team Unibot, boosting its price. Meanwhile, other users created tokens using the web app and sold them on the market with a profit.
Users who have lost crypto have complained of losing thousands, if not millions of dollars. In response to Pauly’s initial post, a PepeCoin enthusiast complained “WTH!!!! I just collapsed!!! 4th [$7,484] worth like $0!!” another collector declared“I put in $50,000 and now it’s worth $10,” prompting another collector to respond, “That’s nothing, I just aped $2.5 million and that’s 169057550415 cents.
According to a report by memecoin holder RuneCrypto, investors lost over $2.2 million during launch.
Pauly’s weather was rough for a week and screwed up so hard almost everyone lost money in $PNDX
He stuck a contract and a website. On the website, people could mint tokens, but it was like a presale. Some random guy added cash right after the mint, and everyone started buying… pic.twitter.com/iETfmRpVXn
— Rune (@RuneCrypto_) July 28, 2023
another user reported that PNDX has a faulty transfer function that allows users to transfer parts from any other user. Blockchain data shows that the coin’s transfer function is unusual. Instead of containing a line of code that updates the user’s balance, it calls a separate “brutalized_” function.
Cointelegraph could not determine the effect of the brutalized_ feature at the time of publication.
About two hours after their initial release, RuneCrypto provided an updated report that declared a new version of PNDX is being created by the person who originally drained the money from investors. According to them, the new project will provide a “dashboard” to compensate victims through a “community coin”.
Memecoins, or coins associated with a viral image or video on the internet, rose to prominence with the launch of Dogecoin (DOGE) in 2013. They remain popular today.
On June 7, several U.S. Securities and Exchange Commission (SEC)-themed memecoins rose in price after the agency sued crypto exchanges Coinbase and Binance. On July 27, several alien-themed memecoins were created and promoted on social media during a US House of Representatives hearing on unidentified flying objects.