The value of a memecoin named “Grok,” inspired by Elon Musk’s AI project, tumbled by over 70% in a startling decline.
This dramatic drop occurred after an influential blockchain investigator, known as ZachXBT, claimed on the social media platform X (formerly Twitter) that the token’s online presence was suspiciously linked to previous scam projects.
Same exact X/Twitter account has been reused for at least one other scam.
X/Twitter ID: 1690060301465714692 pic.twitter.com/iKu7zb6YeS
— ZachXBT (@zachxbt) November 13, 2023
ZachXBT’s revelations, posted on November 13, included screenshots suggesting that Grok’s (GROK) social media profiles and websites were not originally created for GROK but were instead repurposed from older projects. One such project was an abandoned memecoin named ANDY, which had seen its value diminish significantly from its peak.
Following ZachXBT’s post, the value of GROK experienced a sharp 74% drop within five hours, plummeting from its all-time high of $0.027 to a low of $0.007. The price has since settled at around $0.011, according to DexTools data.
In response to the price crash, the GROK development team reportedly took steps to stabilize the token’s value.
An Etherscan transaction highlighted by ZachXBT showed that the team had sent about $1.7 million worth of GROK to a burn address, a move aimed at reducing the token’s supply and potentially restoring investor confidence. This burn involved destroying 90 million GROK tokens.
Moreover, the GROK token’s X account stated on November 14 that the developers had burned all tokens from the deployer address, totaling about 180 million GROK, which was valued at approximately $2 million at that time.
— GROK (@GROKERC20) November 13, 2023
The rise and fall of GROK
GROK had a notable surge in its market value leading up to the crash. On November 13, the token reached its peak price of $0.027, giving it a market capitalization close to $200 million and positioning it as one of the largest new memecoins in the current cycle.
This surge in value, a staggering 33,650% increase, happened in the week following its launch on November 5. The launch coincided with Elon Musk’s announcement of his AI project, Grok AI, potentially a competitor to OpenAI’s ChatGPT.