Inside Meteora’s $57M Memecoin Scam

Key Takeaways

• Benjamin Chow, co-founder of Meteora, faces RICO charges for allegedly orchestrating a $57M memecoin scam.

• The operation used celebrity names like Melania Trump and Javier Milei to lure investors.

• Blockchain analysis uncovered centralized wallets coordinating token creation and liquidity manipulation.

• Multiple tokens, including $LIBRA and $MELANIA, followed a recycled pump-and-dump strategy.

• The case underscores the growing risk of memecoin scams in decentralized finance.

Class Action Lawsuit Alleges $57 Million Memecoin Scam

According to the Second Amended Class Action Complaint, Chow and his partners operated the so-called Meteora-Kelsier Enterprise, allegedly a “fraud factory” disguised as a DeFi protocol.

Using the Meteora liquidity-pooling system on Solana, the group allegedly launched multiple pump-and-dump schemes involving tokens such as $M3M3, $LIBRA, $MELANIA, $ENRON, and $TRUST.

Source: Court Listener

How The Alleged Memecoin Scam Worked

Plaintiffs Omar Hurlock, Anuj Mehta, and John Winslow claim that Chow’s team exploited technical features like whitelists and freeze/thaw toggles to secure the majority of token supplies before public launch.

A forensic blockchain analysis revealed a central coordinating wallet (prefix 0xcEA) that financed deployer wallets, created tokens, and seeded liquidity pools, all while funding sniper wallets designed to capture early token allocations.

The Six-Step “Fraud Playbook”

The lawsuit outlines a six-step strategy allegedly used across all Meteora-linked tokens.

Step 1: Celebrity Narrative Construction

Each project began with a celebrity-driven story, such as Melania Trump’s or Javier Milei’s endorsement, to generate hype.

Step 2: Insider Token Control

Developers allegedly pre-purchased massive token supplies via whitelisted wallets before launch.

Step 3: Paid Influencer Promotion

A network of undisclosed paid influencers and KOLs created hype, promoting the tokens as legitimate celebrity-backed projects.

Step 4: Price Manipulation

Using Meteora’s liquidity pool controls, insiders paused trading, allowing themselves to secure favorable positions before reopening markets.

Step 5: Extraction and Dumping

Once public trading began, insiders dumped their holdings, withdrawing liquidity and collapsing token prices.

Step 6: Recycling the Scheme

After each rug pull, the same team relaunched the scam under new token names and narratives, repeating the cycle.

Case Studies: $LIBRA & $MELANIA Tokens

The $LIBRA Token Collapse

The $LIBRA memecoin scam erupted when Javier Milei’s verified social media account shared the token’s contract address in February 2025, coinciding with the token’s public pool opening.

Marketed as a patriotic project meant to fund Argentine small businesses, $LIBRA attracted a retail buying frenzy.

Within hours, the deployer wallet withdrew over $110 million in USDC liquidity, causing the token’s value to plummet as Milei’s team deleted promotional posts.

The $MELANIA Token Hype

The $MELANIA coin, marketed as the official memecoin of Melania Trump, promised “anti-dumping” vesting features. But wallets tied to the Meteora-Kelsier cluster reportedly acquired one-third of the supply within minutes.

After paid promotion and a brief surge, the price collapsed by over 90%, mirroring previous scams. Hayden Davis, CEO of Kelsier Ventures, admitted in an interview:

“We sniped our own coin to prevent snipers from sniping our own coin.”

Chow’s Resignation & RICO Charges

In February 2025, Benjamin Chow resigned from Meteora following the $LIBRA controversy. While some, like Jupiter co-founder Meow, defended his character, others cited his “lack of judgment.”

A leaked video showed Chow expressing regret:

“I feel so sick, because I gave him Melania. I enabled the guy that should not have been enabled.”

Prosecutors now allege Chow directed smart contract configurations, managed liquidity pools, and authorized selective freezing of trades to manipulate token markets.

Kelsier Labs reportedly invested $2 million in Meteora as part of a “pay-to-play” deal.

Source: Court Listener

Legal Fallout & Wider Implications

The class action lists seven causes of action, including:

• Fraud and conspiracy to defraud

• RICO violations for racketeering and wire fraud

• Deceptive trade practices under New York law

• Unjust enrichment through illicit token gains

This case arrives amid increasing scrutiny of Trump family crypto projects, which allegedly generated $1 billion in pre-tax gains last year.

Both $TRUMP and $MELANIA tokens have since plunged in value, with $MELANIA’s market cap falling from $2 billion to $790 million.

FAQ

What is the Meteora memecoin scam?

It’s a class action case alleging that Meteora’s founder, Benjamin Chow, used celebrity-endorsed tokens to run a $57 million fraud scheme.

Which celebrities were involved?

Melania Trump and Argentine President Javier Milei were featured—though neither is confirmed to have knowingly participated.

How were investors defrauded?

Through insider token manipulation, paid promotions, and liquidity withdrawals that caused massive token crashes.

Is Benjamin Chow still with Meteora?

No. He resigned in February 2025, though prosecutors allege his technical involvement continued afterward.

What can investors learn from this?

Always verify token origins, audit smart contracts, and avoid hype-driven launches that rely on celebrity names.