on-chain detective ZachXBT and $3.9 million Meme coin: Dragon Slayer turned into a "dragon"?

Author: Damilare Damidez, Cryptocurrency Analyst

Compiled by Felix, PANews

Recently, there have been some conflicting opinions in the Cryptocurrency community regarding the reputation of on-chain detective ZachXBT. Some still see ZachXBT as a hero, while others believe that the 'dragon slayer' ZachXBT has ultimately become a 'villain'. In response to this, Cryptocurrency analyst Damilare Damidez posted in support of ZachXBT and revealed the truth behind the controversy.

Background

A few days ago, US President Donald Trump launched his meme coin $TRUMP, and his wife quickly launched the token. These events caused a big stir in the market. In the midst of this meme craze, cryptocurrency trader Micki tweeted: "The busiest person in the encryption space in the next four years will be ZachXBT."

ZachXBT is a well-known blockchain investigator known for working with institutions to track fraud on the blockchain. In response to Micki's remarks, ZachXBT made a "spit" and said that he did not receive anything in return from it.

ZachXBT said: "One of the biggest regrets is not making money first. I'm wasting my time on this kind of thing [to help recover my money], and it doesn't give me anything in return at all, it just distorts my perception of doing good."

In addition, a few months ago, the U.S. government was hacked and lost $20 million, and I helped recover a significant portion of that money. But in the end, no reward was obtained.

This statement led to the issuance of a token called "Justice for ZachXBT", named ZACHXBT, created by degen traders. ZachXBT was airdropped 50% of the token supply (500,000 ZACHXBT).

How does ZachXBT operate in this regard?

Increased liquidity by 50%:

ZachXBT added his airdropped token to the unilateral liquidity pool on Raydium. The market value of the token soared from $5 million to $80 million within two hours.

One hour later, ZachXBT withdraws liquidity:

Initially withdrew 1.7 million ZACHXBT and 340 SOL;

later 89 million ZACHXBTs and 15,771 SOLs;

Total withdraw: 91,000 ZACHXBT and 16,111 SOL.

The following diagram shows how single-edge pools and liquidity extraction work:

When you provide unilateral liquidity for a token on Raydium, the platform uses your deposited tokens to automatically purchase an equal amount of paired tokens, such as SOL, from the pool to form a balanced LP token.

When liquidity is removed, the fees you earn will automatically be credited to your share in the pool. This means:

When you withdraw liquidity, you will receive your tokens (e.g., your tokens and SOL) as well as the fees you earned in the form of additional tokens.

Based on the trading activities in the pool, these fees are paid in two tokens in the trading pair (such as your token and SOL)

Including donations, a total of 16,348 SOL tokens (worth $3.87 million).

ZachXBT transferred the earned value of 3.8 million US dollars and 16,348 SOL to another wallet.

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Then ZachXBT sends it to Wintermute.

Locked Fund Pool:

Later, ZachXBT locked the liquidity pool and added 96 million ZACHXBT tokens to it.

Additional Token Sale: ZachXBT also received 50% supply of another token CRIME, which is being sold at a price of $57,000 (still in the wallet).

Why are tokens being sold?

The collapse of the token is not due to ZachXBT's behavior, but to FUD and traders' lack of on-chain knowledge. Once the news of the withdrawal of liquidity spreads, many people will panic and sell their tokens.

Analysis

ZachXBT's actions show its sense of responsibility:

Instead of blocking the project, he increased liquidity, allowing others to trade

10% of the withdrawals helped him gain financial benefits, but many people believe that this is what he deserves

Re-increasing liquidity does not imply any struggle

The controversy is mainly due to misunderstanding, not malice.

conclusion

ZachXBT's handling of the $ZACHXBT token reflects a fair approach. The purpose of the token is to recognize his contributions, and he earned profits without leveraging influence.

ZachXBT is still a hero, not a villain. The market just needs more education and popularization about on-chain mechanisms and liquidity dynamics.

(The above content is excerpted and reproduced with the authorization of partner PANews, original link)

Disclaimer: The article represents only the author's personal opinions and does not represent the views and positions of Blockclient. All content and opinions are for reference only and do not constitute investment advice. Investors should make their own decisions and trades, and the author and Blockclient will not be responsible for any direct or indirect losses incurred by investors in their transactions.

"Online detective ZachXBT and 3.9 million US dollars worth of Meme coins: the dragon slayer turned into a 'villain'?" This article was first published in "Blocklike".