USDDave Portnoy’s Meme Coin Scandals Spark Allegations of Market Manipulation
High-Stakes Trading and Community Backlash
Dave Portnoy, the founder of Barstool Sports, has once again found himself at the center of controversy after his involvement in a series of meme coin investments led to dramatic market crashes. Despite his public claims of transparency and reassurances that he wouldn’t engage in rug pulls, blockchain data and market activity suggest otherwise.
His engagement with meme coins, primarily on the Solana blockchain, has resulted in allegations of market manipulation, with some traders accusing him of leveraging his influence to artificially inflate prices before exiting his positions.
One of the most controversial incidents involved the GREED token, a meme coin launched by Portnoy featuring an image of Gordon Gekko from Wall Street with the tagline “greed is good.” The token spiked to a $41.5 million market cap shortly after its release, attracting significant investor interest. Portnoy initially purchased $4,200 worth of GREED, later adding $1,670 more as the market cap declined to $20 million.
While he reassured his followers that he wouldn’t dump his holdings, he eventually liquidated his entire stake in a single transaction, exchanging it for another meme coin called JAILSTOOL. The move sent GREED’s market cap plunging by 99% in just four seconds, crashing from $12.88 million to a mere $123,950. Blockchain records revealed that Portnoy controlled 35.79% of GREED’s total supply before the sell-off, profiting an estimated $258,000 from the trade.
The collapse left some investors with significant losses, with one trader reportedly losing $101,000 in just three hours. Facing mounting criticism, Portnoy dismissed concerns, claiming he attempted to burn his supply but encountered technical difficulties. Later, he downplayed the situation, remarking, “I didn’t make a dime on it. Some people won. Some lost. Only the losers keep bitching.”
Despite the backlash, Portnoy swiftly launched a successor, GREED2, which briefly reached a $7 million market cap before crashing by 90% within five hours. His wallet currently holds 268.25 million GREED2 tokens, representing 26.8% of the total supply, raising further concerns about potential price manipulation.
Dismissing the skepticism, Portnoy mocked critics, stating, “You can’t beat me in this meme coin market,” while vowing not to sell GREED2 “until midnight or later.” His actions have fueled speculation that he is orchestrating another pump-and-dump cycle, drawing further scrutiny from traders who see the pattern repeating.
Beyond the GREED saga, Portnoy’s involvement with other tokens has only deepened suspicions. He participated in the LIBRA token, a cryptocurrency linked to Argentinian President Javier Milei. Despite losing $5 million on LIBRA, he was reimbursed by Hayden Davis, a key figure in the token’s launch, who later admitted that insider trading was rampant in the meme coin market.
Further analysis connected LIBRA’s developers to the MELANIA token, another controversial project that raised regulatory concerns. LIBRA’s eventual collapse resulted in fraud charges against President Milei, raising questions about Portnoy’s role in its promotion.
Meanwhile, Portnoy launched JAILSTOOL in the aftermath of the GREED collapse, initially claiming he accidentally sold his holdings while using the toilet. The token’s price at one point surged by an astonishing 119,000% before eventually plummeting, reinforcing criticism that the project was nothing more than an attempt to distract from previous losses.
Portnoy’s trading activity has also drawn scrutiny toward Kraken, a major cryptocurrency exchange that sponsors him. The partnership has led to outrage among crypto traders who accuse Kraken of enabling unethical behavior.
Popular blockchain investigator ZachXBT criticized Kraken’s endorsement of Portnoy, arguing that his actions were “worse than what some of the most notorious crypto influencers ever did.” Investors have questioned how long the exchange will continue its association with someone frequently engaging in speculative trading that closely resembles pump-and-dump schemes.
With concerns mounting over potential legal ramifications, speculation about Portnoy facing criminal charges has intensified. Polymarket, a crypto betting platform, now places the odds of him serving jail time in 2025 at 10%, citing his involvement in at least 15 suspected pump-and-dump schemes. If regulators decide to intervene, the Securities and Exchange Commission (SEC) could investigate his role in manipulating token prices for profit.
Given the legal action taken against influencers in the past for similar activities, the possibility of a federal crackdown on Portnoy’s meme coin dealings remains a growing concern within the industry. Whether legal consequences follow or not, his actions have already left a lasting impact, with millions lost and traders growing increasingly wary of his involvement in the crypto space.
This article has been refined and enhanced by ChatGPT.
