As memecoin traders continue to lose money, some crypto leaders are calling for social pressure as a deterrent against insider-driven scams. On Feb. 17, Paradigm researcher Samczsun floated the idea of a social solution to memecoins’ insider problem. The researcher stated that if people agree that insider-driven memecoins are detrimental, they could begin by “formally ostracizing” those involved in meme token scams. Samczsun suggested that this could render the potential benefits of one-time gains insufficient to outweigh the drawbacks of being regarded as “persona non grata” or unwelcome within the community.
Some community members expressed support for this idea. One user on X remarked that the community needs to make serious efforts to hold individuals accountable or risk losing the industry altogether. Another community member claimed that this approach could be effective, highlighting that the Mango Markets exploiter Avraham “Avi” Eisenberg was initially convicted in the “court of crypto social public opinion” before facing criminal charges.
Not all crypto leaders agree that social shaming serves as an effective deterrent. Solana co-founder Anatoly Yakovenko stated that social layer “pitchforks” are problematic because they respond to outcomes rather than being governed by predefined rules. He noted that it would be challenging for a memecoin to implement such measures, as this would necessitate enforcing social credit scores and rejecting coins with low score distributions. Yakovenko added that while the community could ostracize a key opinion leader (KOL), the group behind the project would simply shift to a different KOL.
Crypto trader Jordan Fish, known as “Cobie” on X, argued that there is no way to “effectively socially shame the shameless.” Fish noted that this phenomenon had been occurring even before the rise of memecoins, stating that whenever someone faced public shaming, they tended to use the attention to counter-accuse. He mentioned that there are YouTubers who remain popular despite facing constant shaming. Fish stated: “The only people I’ve ever seen shamed off this app were relatively credible individuals who made a mistake or didn’t need to use it to generate income. The people who should be shamed off here already know what they are doing, and they have chosen that path.”
Meanwhile, DoubleZero co-founder and former Solana Foundation strategy lead Austin Federa commented that the social layer is adept at penalizing sandwich attackers and poor products. However, he remarked that it is nearly impossible to target scammers and influencers because these individuals are not part of the existing social layer.
The debate surrounding memecoin fraud has intensified in the wake of high-profile political token scams. On Feb. 11, Chainalysis data revealed that over 800,000 crypto wallets incurred losses of $2 billion after purchasing the Donald Trump (TRUMP) memecoin, which has since plummeted 80% from its peak of $72.60 on Jan. 19. A similar situation unfolded with Argentina’s President Javier Milei’s LIBRA token. Following Milei’s endorsement of the token on X, its market capitalization soared to $4.5 billion before insiders cashed out over $100 million, resulting in a dramatic decrease in its value.
The ongoing memecoin frenzy has reignited concerns regarding the integrity of the crypto market, with industry leaders divided on whether social accountability can mitigate fraud or if more robust regulatory measures are necessary.