DeFi Market Maker Meteora Co-founder Ben Chow Resigns After Libra Memecoin Scandal

Some in crypto were surprised to learn about the sudden resignation of Ben Chow, co-founder of Meteora, a decentralized automated market maker, amid the scandal involving the controversial Libra memecoin.

Meow, the pseudonymous founder of Solana DEX Jupiter and co-founder of Meteora, shared the news, highlighting the challenging decisions that come with leadership roles in the quickly expanding crypto space.

The Resignation and Its Backdrop

Meow expressed his confidence in Chow's character but pointed out a critical lapse in judgment regarding core project management. This acknowledgment came in the wake of the Libra memecoin's dramatic rise and fall, which was initially fueled by public endorsement from Argentina's President Javier Milei. The token's value soared to billions only to collapse after Milei retracted his support. Libra's liquidity pools were notably created on Meteora's platform, bringing the project into the spotlight of this controversy.

Hayden Davis, CEO of Kelsier Ventures and a self-described facilitator for the Libra project, stirred further controversy by revealing in an interview that the Libra team engaged in token sniping at launch, a practice he deemed standard for major memecoin launches. Despite these allegations, Chow was quick to defend his and Meteora's integrity. He denied any personal or company involvement with Libra beyond providing IT support, emphasizing that neither he nor his team had received any tokens or insider information.

Chow's relationship with Davis extended beyond Libra, as he had previously referred Davis to other projects, including Melania Trump's MELANIA token launch on Meteora's platform. However, he maintained that Meteora had no financial stake or involvement in the management or distribution of these tokens.

Leaked Video and Public Reaction

Adding to the drama, a video surfaced, purportedly showing a conversation between Chow and DefiTuna founder Dhirk, where Dhirk detailed witnessing unethical practices by Davis during memecoin launches. Chow's reaction in the video was one of dismay and acknowledgment of his error in judgment, leading to his decision to resign. In this candid moment, Chow admitted his mistake in enabling Davis, underscoring his decision to step down.

Meow has since stood by Chow's claim of no financial impropriety, emphasizing that neither Jupiter nor Meteora participated in insider trading. To address the community's concerns and restore trust, Meow announced plans to hire an independent third party to investigate the matter thoroughly.

Solana's Price Tanks

The fallout from the Libra scandal has significantly impacted Solana's price, which has seen a considerable drop this week. This downturn is not just due to the immediate effects of the scandal but also reflects a broader erosion of investor confidence.

Groups like the "LA Vape Cabal," composed of insiders with pre-launch token access, includes the likes of Hayden Davis, have been implicated in practices where they "snipe" tokens at launch only to sell them off immediately, thereby dumping on retail investors. These groups of people have unprecedented insider access through various connections to market makers. Since these groups are interconnected, often they share confidential information so they can beat retail to the punch, and dump on the market as soon as a new memecoin launches.

Such manipulative practices have contributed to a negative market sentiment, further pressuring Solana's price as the community grapples with these new revelations about what has been going on with all these memecoin scams.