In a swift and dramatic turn of events, the memecoin named after Elon Musk's AI project, "Grok," faced a substantial decline of 74% in response to allegations that its social media account was recycled from a previous scam token project. The accusations were brought to light by blockchain investigator ZachXBT.
Allegations of Social Media Account Recycling:
ZachXBT shared damning screenshots indicating that various social media accounts and websites associated with the GROK token were repurposed from past projects, including an abandoned memecoin named ANDY. The screenshots highlighted a concerning overlap in X (formerly Twitter) account details, raising suspicions about the legitimacy of GROK.
Market Response:
The aftermath of ZachXBT's revelations was swift, with GROK experiencing a staggering 74% drop from its all-time high of $0.027 to a low of $0.007. Despite some recovery, the price retraced to $0.011, marking a significant setback for the memecoin.
Attempted Damage Control:
In an attempt to salvage the situation, the GROK development team reportedly sent approximately $1.7 million worth of the token to a burn address. The move aimed to reduce the token's supply and rebuild confidence among investors. The X account associated with GROK later claimed that the team had burned all tokens from the deployer address, equivalent to 180 million GROK, worth around $2 million at current prices.
Background and Rise to Prominence:
GROK entered the crypto scene on November 5, the same day Elon Musk announced Grok AI, presented as a competitor to OpenAI's ChatGPT. The memecoin swiftly gained traction, reaching an impressive peak price of $0.027 on November 13 and commanding a market capitalization of nearly $200 million.
The GROK memecoin's rollercoaster journey reflects the volatile nature of the crypto market, where hype, social media influence, and accusations can lead to rapid and substantial price fluctuations. As the community awaits further developments, the incident underscores the importance of due diligence and cautious engagement in the ever-evolving landscape of memecoins.