Base’s Zora Post Sparks Token Frenzy, Crashes 99% in Just 4 Hours

A newly minted token generated through a standard content post on Zora by the Base team has caused a sharp stir in the crypto community. According to details shared on-chain, the post automatically created an ERC-20 token, which saw a rapid surge in trading activity and extreme price volatility.

Shortly after the token appeared on Uniswap, trading volume quickly surpassed $13 million. Within just four hours, its price spiked dramatically and then collapsed by over 99 percent, wiping out liquidity and triggering community backlash.

The event unfolded as part of Zora’s content-tokenization process, where every published post becomes its own ERC-20 token. As per Zora’s model, Base received 10 million tokens, which represents one percent of the total supply.

Base later clarified that these tokens were not official and were not endorsed by Coinbase or any related product. The disclaimer, already present on the Zora post, emphasized that the token was created for artistic and cultural purposes only.

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Trading Activity Raises Questions Around Speculation and Ownership Concentration

According to blockchain researcher Hantao, bot-driven trading was a major factor behind the token’s sudden volatility. He highlighted indicators of “volume bots” on the trading chart and raised alarms about a wallet that held 25.6 percent of the token’s total supply.

Multiple wallet owners concentrated an overwhelming number of tokens causing significant user concern since many saw this pattern as an artificial speculation method. The sudden changes in liquidity levels between wallets heightened discussions about the current systems of valuing and trading onchain content.

While the Base team reaffirmed the token’s unofficial nature, its visibility and the trading activity it attracted demonstrated how quickly content coins can become speculative assets. Trading activity on the token happened despite clear warning signs and explanations leading to a total loss of its value within a few hours.

Base founder Jesse Pollak resolved the situation by clarifying that content coins serve as direct expressions of the original content material. According to him the coin represents its content just as its content functions as the coin while the market behavior tends to exceed cultural intentions.

The wake of the Basecoin incident initiated various discussions about distributed publishing methods and tokenized media content. More people participating on Zora necessitates clearer standards which differentiate artistic content from speculative financial activities.

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