Zach Witkoff, co-founder of World Liberty Financial, became the latest victim of a hack when his X (formerly Twitter) account was taken over by cybercriminals. The hackers used his account to promote $BARRON, a fake memecoin linked to Barron Trump, the youngest son of former U.S. President Donald Trump.
The fraudulent $BARRON token, based on the Solana blockchain, saw a meteoric rise in market value, briefly hitting a $73 million market cap before plummeting by 99%. This dramatic fall is indicative of a “rug pull” scam, a fraudulent scheme where the creators artificially inflate a token’s value before cashing out, leaving investors with worthless assets.
World Liberty Financial Responds
World Liberty Financial, a decentralized finance project affiliated with the Trump family, swiftly clarified the situation. The company confirmed that Witkoff’s X account had been compromised and urged followers to disregard the fraudulent promotion.
“Zach Witkoff’s account was compromised. Please do not engage with any posts promoting this project,” the company stated on X.
Previous Scams and the Rise of Celebrity-Themed Memecoins
This incident follows a similar scam from January, where a memecoin themed after Ivanka Trump also gained traction before being disavowed by her. The popularity of celebrity-themed tokens has surged, particularly since Donald Trump announced the launch of his own cryptocurrency, Official Trump, on the Solana blockchain. Soon after, his wife Melania Trump introduced Melania Meme, also a Solana-based token.
Concerns Over Memecoin Scams
The surge of memecoins featuring public figures has raised growing concerns about the legitimacy of such projects and the prevalence of scams within the crypto space. Binance CEO Changpeng Zhao (CZ) recently questioned the authenticity of celebrity-linked tokens, asking how investors can distinguish legitimate coins from fraudulent ones.
“The rise of memecoins has highlighted the lack of transparency in many projects, making them susceptible to “rug pulls,” where the value is artificially inflated before creators sell off their holdings, causing financial harm to unsuspecting investors,” said Zhao on X.
Despite the popularity of memecoins, experts warn of the inherent risks, as these tokens often lack transparency and rely heavily on speculation. The U.S. SEC Commissioner Hester Peirce acknowledged that, in a February 11 interview, most memecoins do not fall under the current regulatory scope of the SEC.
As the memecoin market continues to attract attention, the $BARRON incident serves as a stark reminder of the risks involved in such speculative investments.
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