A viral experiment by Coinbase’s Layer 2 network, Base, turned into a cautionary tale after an unofficial meme coin, minted via Zora, soared to a $13 million valuation—only to collapse by 92% within hours.
The incident began when Base’s official X account posted a phrase—“Base is for everyone”—which was automatically tokenized into a tradable asset via Zora, a decentralized social protocol that converts content into ERC-20 tokens. Despite a clear disclaimer that the token was not official and “not an investment,” traders quickly aped in, driving its market cap from $0 to $13 million before it crashed to just $1 million within three hours.
Data from DEXScreener later showed the token recovering slightly, up 20% to $0.007, but the damage had been done.
How It All Happened
At 3:12 PM ET, Base posted the phrase on Zora. The post auto-minted a token, which then became tradable. Base received 1% of the supply (10 million tokens) as the creator but pledged not to sell.
The sudden hype and subsequent crash were fueled in part by misinformation and a lack of understanding about how Zora functions. Zora and Base both issued follow-up statements, emphasizing the onchain experimental nature of the launch and clarifying it was not an official token.
“Base is posting on Zora because we believe everyone should bring their content onchain,” said Base on X. Zora’s official account echoed this with a cryptic message: “study Zora.”
Rug Pull Allegations and Wallet Concentration
Critics like Hantao Yuan, co-founder of quest-to-earn platform Moku (backed by Sky Mavis and a16z), pointed out deeper issues. Yuan revealed that the top three wallets held 47% of the total token supply, and one wallet alone controlled 25.6%.
He alleged that up to 2,500 wallets—many of whom were new to the Base ecosystem—were potentially “rugged.” He also flagged volume bots manipulating trading behavior on the charts.
“Content Coins,” Not Meme Coins?
Jesse Pollak, the creator of Base, later tried to reframe the narrative. He distinguished “content coins” from meme coins, arguing that content coins are digital collectibles representing one unique piece of content with no expectations of value.
Pollak referenced an essay by Jacob Horne, co-founder of Zora, who argued that crypto-based content monetization can replace restrictive internet paywalls by fairly distributing value among creators and consumers.
“Coins unlock a free and valuable internet,” Horne wrote, proposing a decentralized model where content is both freely accessible and fairly monetized.
Transparency Questions Remain
While Base confirmed to Decrypt that it did not sell its token allocation and the token was never official, the broader crypto community remains skeptical about such onchain experiments—especially when millions in trading volume and thousands of participants are involved.
Onchain data reveals that the token generated $28 million in trading volume and earned Base over $60,000 in creator rewards, despite the disclaimer of “not an investment.”
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments are volatile and risky. Always conduct your research before making any investment decisions.
