Afrobeats superstar Davido has once again dabbled in the crypto world with the launch of "Timeless Davido" ($DAVIDO), a token on the Solana blockchain. This marks his third attempt in the volatile crypto space, following his previous endeavors with $echoke and the controversial promotion of Racksterli.
The $DAVIDO token debuted with much fanfare on Wednesday night. It rapidly gained traction, reaching a $10 million market capitalization within just four hours. Davido's endorsement on social media played a significant role in this initial surge. Solana's official Twitter account also welcomed the superstar, adding to the hype.
However, the excitement was short-lived. By Thursday morning, $DAVIDO’s valuation had plummeted by 90%, with liquidity dropping to $291,000. The sudden dip has led to widespread speculation of a "rug pull" – a fraudulent scheme where developers abandon a project and abscond with investors' funds.
This isn't Davido's first misstep in the crypto arena. In November 2021, he launched $echoke on the Binance Smart Chain, promising various entertainment-related benefits. The project quickly fizzled out. Additionally, his promotion of Racksterli, a Ponzi scheme that allegedly defrauded users of ₦1 billion, has previously drawn significant backlash.
Crypto experts and analysts have been vocal about the potential fraud surrounding $DAVIDO. Several prominent crypto figures and analysis handles reported suspicious activities, such as the wallet that created the token selling off significant amounts and cashing out $200,000 within hours of the launch. Some estimates suggest the creators made around $500,000 in under 24 hours, leaving many investors with worthless tokens.
The crypto community has reacted with disappointment and anger. Many feel betrayed by Davido's involvement, expecting at least a short-term profit instead of a swift loss. Critics argue that Davido’s participation in such schemes tarnishes his reputation and exploits his fans.
A crypto expert told TechCabal, “Davido does not need this type of negative publicity. Whatever money he made from it is not worth it.”
The controversy surrounding $DAVIDO underscores the risks associated with celebrity-endorsed crypto projects. While the allure of quick profits in the crypto market can be tempting, the potential for fraudulent activities remains high. Davido’s management has yet to respond to the allegations, but the incident serves as a cautionary tale for investors and highlights the need for greater scrutiny and responsibility in the promotion of crypto ventures.
