Cardi B-Endorsed Memecoin Under UAE Investigation as Regulators Clamp Down on Crypto

The UAE's SCA suspects the WAP token may be part of a pump-and-dump scheme.

Written by Radhika Parashar, Edited by Siddharth Suvarna | Updated: 15 October 2024 13:10 IST

Cardi B-Endorsed Memecoin Under UAE Investigation as Regulators Clamp Down on Crypto

Photo Credit: X/ @iamcardib

The WAP token has a circulating supply of one billion, as per CoinGecko

Highlights

WAP is currently trading at $0.01611 (roughly Rs. 1.35)
Its market cap stands at $16.1 million (roughly Rs. 136 crore)
Cardi B has not yet reacted to UAE’s action against WAP

In a move signalling stricter oversight of the crypto sector, the UAE has recently intensified its regulatory stance. The latest development sees the country launching an investigation into the $WAP token, endorsed by rapper Cardi B, whose popular song shares the same name. According to a notice regarding the Solana-based token, the UAE is probing it for potential securities violations.

The UAE's Securities and Commodities Authority (SCA) initiated a probe against the crypto token suspecting it could be part of a pump-and-dump scheme waiting to unfold. The SCA was alerted to the token by what its notice describes as a "prominent Dubai-based venture capital firm" and associated Emirati investors.

WAP Token and Suspicions Surrounding It

With an animated cat as its mascot, the WAP token falls under the memecoin category with a circulating supply of one billion tokens, as per CoinGecko. While the exact release date of this token remains unclear, its official X page was created in September this year.

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In recent weeks, Cardi B, who boasts over 35 million followers on X, began promoting the $WAP token across her social media platforms. On October 8, she shared a promotional post along with a wallet address.

Her name is $WAP :feet::sweat_drops:
CA:Bz7vVzQhm2KMW1XgcrDruYega1MiwrAs1DQysrx4tFkp pic.twitter.com/BDvJqeqh0u
— Cardi B (@iamcardib) October 7, 2024

As per CoinTelegraph, a blockchain investigator going by the name of Wazz flagged that the wallet address posted by the WAP page was linked to multiple crypto scams.

Incredible how after the coin was basically dead after 3 days, everyone suddently shilled $WAP at the same time

Also amazing that massive amounts of tokens were sent out from sniper wallets ($50-100K+ per wallet) hours just before that pic.twitter.com/2nTc1UFkvs
— Wazz (@WazzCrypto) October 13, 2024

Soon after, blockchain data platform BubbleMaps claimed that $500,000 (roughly Rs. 4.20 crore) worth of WAP tokens were suspiciously dumped hours after launch. BubbleMaps also said that the WAP token is heavily bundled – that could have buyers purchase multiple units of the asset in one transaction.

60% of the supply bundled at launch

already dumped $500k

her name is $WAP https://t.co/Ib6gkW2bHn pic.twitter.com/iAzfuaWaw1
— Bubblemaps (@bubblemaps) October 8, 2024

$WAP is heavily bundled

They used intermediary addresses to hide from Bubblemaps. Here's the map with those addresses included

Our V2 solves this (coming soon)https://t.co/OW4Sbr48p4 pic.twitter.com/GySQI13Mav
— Bubblemaps (@bubblemaps) October 12, 2024

These factors have raised red flags among investors and blockchain watchdogs, suggesting the memecoin could be problematic.

UAE's Stance on the WAP Token

In its notice, the SCA said that the promoters of this token including Cardi B have hired a network of paid individuals who received the tokens for free through undisclosed financial arrangements.

As per the SCA, “Preliminary investigations suggest that the insiders associated with the $WAP token, alongside various paid Key Opinion Leaders, are orchestrating a clear pump and dump scheme. This scheme involves artificially inflating the price of SWAP through strategic promotions, followed by the systematic sale of their holdings, thereby inflicting significant financial losses on unsuspecting retail investors.”

The UAE authorities have joined forces with BubbleMaps to infer that this token is violating securities laws of the US as well as the UAE.

As of now, Cardi B has not reacted to the development.

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Earlier this week, Dubai's Virtual Assets Regulatory Authority (VARA) issued a cease-and-desist order against seven crypto entities for operating their businesses without acquiring the required approvals.

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Further reading: Cryptocurrency, WAP, Cardi B, UAE, Memecoin

Radhika Parashar

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Radhika Parashar is a senior correspondent for Gadgets 360. She has been reporting on tech and telecom for the last three years now and will be focussing on writing about all things crypto. Besides this, she is a major sitcom nerd and often replies in Chandler Bing and Michael Scott references. For tips or queries you could reach out to her at RadhikaP@ndtv.com. More