A memecoin named MUNGER, created shortly after the death of billionaire Charlie Munger, saw an astonishing surge of over 31,000% on Wednesday. However, the coin subsequently experienced a dramatic loss of more than 98% of its value the following day.
As news spread about the passing of Berkshire Hathaway’s vice chairman, the MUNGER memecoin witnessed a rapid increase of over 31,000%, with investors flocking to decentralized exchanges and trading millions of dollars worth of Ether and stablecoins.
The daily trading volume for MUNGER reached its peak at $3.5 million on Wednesday, according to CoinMarketCap. Unfortunately, the token faced a significant decline of over 98% in value on Thursday after revelations about the token’s smart contract. It was disclosed that the smart contract contained erroneous functions, allowing developers to impose restrictions on the sale of the asset.
The smart contract of MUNGER included a blacklist function and authorization, potentially enabling manipulation to induce users to approve a malicious smart contract, as reported by GeckoTerminal.
Currently, the daily trading volume for MUNGER has dwindled to less than $40,000, and the token is valued at $0.00000003039 at the time of writing.
Charlie Munger, often regarded as Warren Buffett’s closest partner and right-hand man, was a staunch skeptic of Bitcoin and cryptocurrencies in general. He once described Bitcoin as “detestable” and expressed his disapproval of cryptocurrencies, stating, “I’m not proud of my country for allowing this crypto s***. It’s worthless, it’s no good.”
Charlie Munger’s aversion to Bitcoin stemmed from its volatility and the absence of well-established regulatory frameworks. He had voiced concerns about Bitcoin potentially facilitating criminal activities, including drug dealing, terror funding, kidnapping, and extortion.
In Munger’s words, “I don’t welcome a currency that’s so useful to kidnappers and extortionists and so forth, nor do I like just shuffling out of your extra billions of billions of dollars to somebody who just invented a new financial product out of thin air.”
The creation of numerous memecoins daily, capitalizing on breaking news for speculative tokens of questionable origin, has become a trend. Last week, a newly minted CZ token, emerging after Changpeng Zhao’s resignation as Binance’s CEO, saw an 18,000% surge.
However, the swift rises in value also expose investors to significant risks. Memecoins like MUNGER are often susceptible to “rug-pulling,” where anonymous creators withdraw liquidity, resulting in substantial losses for investors.