In the recent on-chain meme coin craze, the AI trading fund ai16z based on Solana brought imagination for AI agents and community governance, and with the endorsement of a16z founder Marc Andreessen, the token price rose significantly, with the market cap once reaching $600 million. However, yesterday (19th) around 14:00, the ai16z token price suddenly plummeted, hitting a low of $0.1348, and as of writing, it is reported at $0.2504, with a nearly halved decline in the past 24 hours, and the market cap falling to $270 million.
The reason for AI16Z's plunge revealed: The meme coin ELIZA controversy triggered market panic. The main reason for AI16Z's crash is closely related to its new meme coin project ELIZA.
The birth of lowercase eliza.
AI16Z partner @shawmakesmagic revealed that the team planned to launch a meme coin called Eliza but stated they ultimately did not intend to start the project and encouraged the community to issue it themselves. On November 17, the community responded by launching the lowercase eliza token and airdropped a large number of tokens to AI16Z, with the market cap surpassing $50 million in just two days, attracting investors.
Official denial and launch of uppercase ELIZA.
Subsequently, @shawmakesmagic clarified on Twitter that the lowercase eliza is not the official token of AI16Z, stating that it preempted the planned launch of the uppercase ELIZA project. He mentioned that a project that the team invested a lot of resources in was misappropriated, while promising airdrop compensation to eliza holders to avoid losses.
Market panic spreads.
This statement triggered community division and questions about official manipulation, leading to panic selling by investors, causing AI16Z to plummet.
The ELIZA project controversy has exposed the market's sensitivity to decentralization and profit distribution, and AI16Z's decline also reminds investors to be wary of the interaction between project teams and market sentiment.
eliza and ELIZA experience violent fluctuations.
Due to @shawmakesmagic and his team announcing a clarification of their relationship with Eliza and issuing a new ELIZA token, the market has become polarized. The price of eliza once spiked to $0.0049, but last night, due to announcements from multiple exchanges, it surged again to $0.08 before falling back. As of writing, it is reported at $0.03405, with a market cap returning to $32.5 million.
On the ELIZA side, due to the official recognition by ai16z, its price once surged, but this morning it has retraced, and as of writing, it has slid to $0.03695, with a market cap of about $34.7 million, close to the market cap of lowercase eliza.
Community questions: Envious of eliza's success, AI16Z is accused of manipulating insider trading.
@shawmakesmagic and AI16Z's actions have sparked strong dissatisfaction in the community:
Hypocrisy accusation: @shawmakesmagic once stated that the community could issue Eliza on their own, but after the lowercase eliza was successful, AI16Z instead launched its own uppercase ELIZA and attempted to 'reclaim the project', being accused of double standards.
Insider trading exposure: Some community members investigated and found that after the issuance of ELIZA, the AI16Z team allegedly purchased large amounts of tokens through multiple wallets and sold them off massively for profit after the market cap rose, causing investors to become bag holders.
Token control controversy: Crypto KOL @0x0xFeng exposed that AI16Z controls over 90% of ELIZA's tokens and profits massively from price fluctuations, further triggering a crisis of trust in the community.
This incident not only dragged down the price of AI16Z's token but also severely damaged its reputation in the community. The future development of ELIZA and eliza still needs to be observed, but the road to rebuilding trust will be even more difficult.
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