Dubai, United Arab Emirates – Sahil Arora, a Dubai-based investor, is accused of orchestrating a multi-million dollar cryptocurrency pump-and-dump scheme using celebrity endorsements and the Solana-based platform Pump Fun. According to a report by Bubblemaps, a blockchain analytics firm, Arora allegedly exploited Pump Fun to launch celebrity tokens, defrauding investors of an estimated $30 million in 2024 alone.
Pumping Up The Hype
The report details how Arora targeted celebrities like Caitlyn Jenner, Floyd Mayweather, Amber Rose, Sunny Leone, and Iggy Azalea. He reportedly offered them significant payments in exchange for promoting newly created tokens on their social media platforms. Arora, with his own 1.5 million strong following on Instagram, further fueled the hype surrounding these tokens.
However, the scheme involved a sinister twist. Bubblemaps claims Arora retained a significant portion of the token supply, ranging from 25% to 40% across multiple wallets. Once the celebrity endorsements triggered a surge in investor interest, Arora allegedly dumped his holdings immediately after the promotional tweets. This sudden sell-off caused the token prices to plummet, leaving unsuspecting investors with massive losses.
Exploiting a Legal Gray Area
Bubblemaps identified over 40 crypto wallet addresses linked to Arora, suggesting a meticulously planned operation. He reportedly funneled the proceeds from his sales to a central wallet and then transferred them to centralized exchanges, potentially cashing out on his ill-gotten gains.
The report further highlights a concerning aspect: Arora’s actions might exist in a legal gray area. “Despite thousands of fans losing money,” Bubblemaps states, “Sahil’s actions fall into a legal gray area, making them difficult to pursue. Even the celebrities aren’t going after him because they are partly responsible.” This raises questions about the regulatory landscape surrounding celebrity endorsements in the cryptocurrency space.
Also Read: Dubai Customs Embraces Blockchain: Streamlining Trade and Boosting Transparency
Pump Fun’s Record Growth and Security Concerns
Pump Fun, the platform allegedly exploited by Arora, has seen explosive growth recently. The platform reportedly set a record in July, generating a staggering $28.73 million in agreement income. It even surpassed Ethereum’s daily revenue for a period. However, this growth comes with concerns. Pump Fun recently removed the $2 fee for token creation, potentially attracting bad actors like Arora. Additionally, the platform faced a security breach in May, with hackers draining $2 million worth of funds.
This incident underscores the importance of investor vigilance in the ever-evolving cryptocurrency market. Investors should thoroughly research any token before investing, particularly those promoted by celebrities. Additionally, regulatory bodies may need to establish clearer guidelines regarding celebrity endorsements in the crypto space to prevent similar scams from occurring in the future.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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