GROK Dumps 50% as Links to Failed Projects Halts AI-Inspired Token's Rally

It reached a $150 million on Monday, amassing over 13,000 holders and trading over $25 million in volume on decentralized exchanges.

AccessTimeIconNov 14, 2023 at 11:58 a.m. UTC
Updated Nov 14, 2023 at 4:53 p.m. UTC

GROK, an X AI-inspired token, lost nearly $100 million in capitalization in the past 24 hours as its developer was linked to projects that previously failed to gain traction, drawing eyeballs from market observers. The token is inspired by, but is completely unrelated, to Grok AI, a chatbot service by Elon Musk-owned X that’s currently in beta testing.

Grok prices gained some 13,000% in just nine days after deployment, data shows, beating the rises of recently popular Pepecoin (PEPE) and HarryPotterObamaSonic10Inu (BITCOIN). It reached a $150 million market capitalization on Monday, amassing over 13,000 holders and trading over $25 million in volume on decentralized exchanges.

But the euphoria seemingly hit a snag late Monday. Prominent blockchain sleuth @ZachXBT linked the deployer of GROK tokens to wallets that had previously issued projects that failed to take off after issuance.

“Not that people in this space will care but $GROK was created by a scammer,” @ZachXBT said. “Same exact X/Twitter account has been reused for at least one other scam.”

Screenshots posted on X by @ZachXBT showed the deployer had previously issued ANDY tokens and changed their usernames multiple times on the messaging application Telegram.

The finding sent GROK prices immediately spiraling. Some large token holders began selling amounts equivalent to $30,000, DEXTools data shows, driving prices down by at least 70%. Selling activity bumped token trading volumes to over $100 million, the data shows.

You’d expect the project to have died, but it didn’t. GROK community members quickly shoved off @ZachXBT’s findings as ‘FUD’ – an abbreviation of fear, uncertainty, dismissal; a term akin to an untoward attack on any project – and coaxed their online circles to instead buy even more of the tokens.

The developers, meanwhile, burned all of their token supply, valued at over $1.7 million at the time, by sending those holdings to a null address. This incited even more confidence among followers.

Online sentiment remains shaky, but the community chugs along. For some believers, GROK is possibly the “next shib,” – a reference to Shiba Inu’s (SHIB) momentous rise from obscurity to a $35 billion capitalization between 2020 and 2022.

UPDATE (Nov. 13, 13:03 UTC): Removes a reference to rug pulls. Says the previous projects had failed to gain traction among investors.

Edited by Parikshit Mishra.


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Shaurya Malwa

Shaurya is the Deputy Managing Editor for the Data & Tokens team, focusing on decentralized finance, markets, on-chain data, and governance across all major and minor blockchains.

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