Nigerian star Davido scams fans with his memecoin

Two days after launching his crypto, famous Nigerian rapper Davido picked up 20% of the supply for just 7 Solana, or $1,150. The rapper then sold all the tokens acquired for 2,791 Solana (around $474,000) after promoting them. An attitude that has been strongly denounced in the crypto community in Nigeria, where Davido is described as a swindler.

Davido uses his fans as exit liquidity

The Nigerian David Adedeji Adeleke better known by his stage name Davido is undoubtedly one of Africa’s most prolific artists. If the artist is well appreciated in the music world, Davido rarely makes anyone happy in the crypto ecosystem he’s involved with. Indeed, the Nigerian artist has been accused of ripping off his fans after promoting his crypto before reselling it, pocketing around $474,400 in the process.

According to onchain data, the rapper Davido launched the DAVIDO memecoin on the Solana blockchain on May 29, 2024. Davido then bought 203 million DAVIDO, or 20% of the total offering, at a price of 7 Solana, or around $1150. The star then set about promoting his crypto to his fans, including his more than 15 million followers on X. As a result, the project enjoyed a meteoric rise.

However, this success was short-lived, and the memecoin’s founder is no stranger to this sudden fall. Just hours after touting his DAVIDO memecoin, the rapper got rid of it. In particular, the data shows that Davido sold 121.88 million DAVIDO for 2,791 SOL, generating around $474,400 from the sale. As a reminder, the rapper had acquired 203 million DAVIDO for less than $1,200 just two days before.

This isn’t the first time Davido has promoted crypto scams. In July 2021, Davido had vigorously promoted the RapDoge crypto. His fans bought in massively, increasing its value by 100% before returning to its initial price. A few months earlier, Davido had also promoted Racksterli, a Ponzi scheme that disappeared, much to the dismay of investors.

The crypto community denounces Davido

The manipulation of the DAVIDO memecoin by its founder has been widely commented on in Nigeria’s crypto ecosystem. Several crypto industry players have vigorously criticized the rapper’s actions. One of them is Rume Ophi, a pioneer of crypto education in Africa.

The man known as “Cryptoreacher” qualified Davido’s act as a scam, pure and simple. For Rume Ophi, Davido just used his popularity to arouse FOMO among investors in order to cash in and then let buyers hold a worthless asset.

One of the earliest and brightest warning signs of any crypto scam is when the creators themselves are the first to run for the exit after briefly raising the price.

Rume Ophi

The crypto scam promoted by artist Davido has consequences beyond the financial damage to investors. Rume Ophi fears in particular that Davido’s actions could damage the crypto industry in a country. While crypto adoption is steadily rising in Nigeria, scams like this could justify regulatory restrictions seen in the country.

It’s true that every individual is responsible for his or her investments and takes full responsibility for his or her choices. However, influential people should stop misleading their fans, especially when they have no knowledge of crypto. If Davido is really into crypto, he should join forces with the Nigerian community, which is making a positive contribution to the growth of the crypto industry, rather than undermining it.