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On Friday, June 21st, 2024, Curtis Jackson aka 50 Cent lost control of his verified X (formerly known as Twitter) account following a hack. The account has a massive 12.9 million followers.
50 Cent. (Source: Entertainment Weekly)
What was the plan of hackers?
50 Cent is founder of G Unit Records and the co-founder of G-Unit Clothing Company. Hackers made a specific meme coin (GUNIT) for the scam. Hackers used this association of 50 Cent with G Unit to misguide the public by posting cleverly crafted tweets which made it look like that the celebrity is endorsing the coin (GUNIT). The trade volume of GUNIT steeply rose up to 8000% following the tweets.
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How it went down?
50Cent took it to Instagram to inform the public about the hack and revealed he had nothing to do with the $GUNIT.
He further claimed that “…Whoever did this made $300 million in 30 minutes.” The coin crashed abruptly after the clarification by 50 Cent. He regained control of his account later the same day.
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This was a perfect example of a pump-and-dump scam. These scams are designed to be quick hits, where hackers rapidly inflate the price of a coin and abruptly abandon the project leaving all the investors hanging. Ironically, even after the hack was exposed, few investors kept purchasing the coin leading to GUNIT maintaining a market cap of $150,000.
Lessons learnt from the 50 Cent Hack?
- The incident should be a valuable lesson for the public to have increased scrutiny of celebrity endorsements. Investors should be more careful about projects promoted by a celebrity especially if it seems sudden or without clear lack of details.
- Social media platforms should put stronger authentication measures to prevent similar breaches to protect online platforms from exploitation. More efforts should be made to protect accounts of high-profile individuals. Similar breaches have happened with notable figures like Microsoft India official account and of OpenAI’s chief scientist.
- This incident could contribute to increased pressure on the regulatory bodies against meme coins to prevent such pump-and-dump scams.
- Investors should be more selective for meme coins and focus on the coins with underlying projects and functionalities.
Impact on meme coins
Source: CoinGape
Incidents like these further erode investor confidence and decrease the popularity of the meme coins. Well established meme coins may not be affected much by such activities, but it may potentially create hardships for new meme coins to gain traction due to investor skepticism. Such hacks might lead to short-term price fluctuations on existing meme coins pushing investors to sell out of their meme coin holdings due to fear or uncertainty.
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