The meme coin named GROK experienced a significant crash, losing 74% of its value rapidly after crypto investigator ZachXBT exposed its connections to a known scam.
GROK, taking its name from Elon Musk’s new artificial intelligence chatbot unveiled earlier in the month, faced a sudden decline in value. It’s crucial to clarify that the token, along with many others with similar names, does not have any official affiliation with the Grok AI bot.
ZachXBT revealed that the Twitter account promoting GROK has ties to “at least one other scam” that occurred in the past, shedding light on the potential fraudulent activities associated with the token. This incident underscores the risks and volatility in the crypto space, especially with meme coins, and the importance of due diligence before engaging with such assets.
Following the revelation about the token’s creator and the exposure of its links to a known scam, GROK experienced a rapid sell-off. The token plummeted from an all-time high of $0.02 on Monday to just $0.009 the next day, based on data from CoinGecko.
As of the latest update on Wednesday, the token had managed to recover some of its losses, trading at $0.012.
In response to the allegations made by ZachXBT, the developers of GROK took measures to address the situation. A Space broadcast was hosted on Twitter Spaces, and the developers burned 90 million tokens, valued at approximately $1.2 million at the current price, from the deployer wallet. These actions appear to be efforts by the developers to demonstrate their commitment to the GROK token project and regain trust from the community.
Mixed reactions in the community
The GROK incident has sparked controversy within the crypto community. Some traders expressed gratitude, thanking those who took actions to address potential scams and prevent financial losses. However, others criticized the situation, labeling it as detrimental to individuals involved in what they perceived as a “community project.”
Comments from community members highlighted the tensions within the crypto space when it comes to addressing potential scams or fraudulent activities. The incident serves as a reminder of the importance of due diligence and caution, as well as the potential impact on individuals who may unintentionally become involved in projects that face scrutiny or controversy within the crypto community.