While most exit scams or rug pulls result in the collapse of a project, Solana-based memecoin Catwifhat (CIF) managed to survive two of them, illustrating how crypto’s decentralized nature can sometimes allow a project to continue even when its developer disappears.
In a conversation with Cointelegraph, Catwifhat investor NFT_Sloth claimed that the project survived two rug pulls over 12 days, yet still has a dedicated community behind it today.
First, the project’s founder allegedly dumped their tokens into the open market only a few hours after launch on Dec. 12, 2023, cashing in 20% of WIF’s supply for 3.86 SOL (SOL) (worth approximately $265 at the time) and pulling most of its liquidity. Despite this setback, the remaining investors quickly took over the project, forming a new dev team to promote the token. As a result, CIF recovered to a market cap of more than $4 million by Dec. 23, just 11 days after it had been rugged.
But then, the token’s largest liquidity provider rugged the project again on Dec. 24, removing 92% of its liquidity and tanking the price by approximately 76%. Despite suffering further losses, the token’s dev team restructured yet again and continued to work on the project. As of April 3, its market cap sits at approximately $1.4 million. The 200 million tokens the founder sold on launch day would be worth over $250,000 today had they held.
Catwifhat precursor reached a $3 billion market cap
According to NFT_Sloth, Catwifhat was created to follow in the footsteps of Solana memecoin Dogwifhat (WIF), which launched in November 2023. This earlier token was created to take advantage of the “Dogwifhat” meme that had grown popular on the X platform since 2019.
According to meme history site Know Your Memes, the Dogwifhat meme got its start on Nov. 6, 2019, when professional Fortnite player Issa temporarily changed his profile picture on X to an image of a Shiba Inu dog wearing a beanie hat. Other Fortnite players also changed their profile pics to the image shortly afterward, claiming they were creating a Dogwifhat “movement” or “gang.”
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The following month, X users began to edit the photo in various ways and repost it to X, causing the meme to spread throughout the platform quickly.
In November 2023, a team of crypto developers attempted to capitalize on this phenomenon by creating a token associated with it. According to NFT_Sloth, members of the Dogwifhat community sent images to various memecoin influencers on X. They took the influencer’s profile picture and edited it, adding the beanie from the Dogwifhat meme.
One of these influencers was “Joji,” who used an Azuki nonfungible token as their profile picture. They were sent an image of this Azuki with the beanie on its head, allowing them to express support for the token through this altered profile picture. Joji began promoting Dogwifhat on their Telegram and X channels, and the token quickly gained popularity.
Catwifhat launches and developer dumps tokens
As told by NFT_Sloth, Catwifhat was one of the first memecoins attempting to follow in the footsteps of Dogwifhat. However, the developer of the project allegedly executed an exit scam mere hours after it launched.
According to the Solscan block explorer, the developer of Catwifhat minted 1 billion tokens at the moment of creation on Dec. 12, 2023, all of which were sent to the deployer account. From there, they sent 10% of the supply (100 million CIF) to an account beginning with Fm1w and another 10% to an account beginning with AUKt. The remaining 80% (800 million CIF) was deposited into a liquidity pool on the Raydium decentralized exchange. These 800 million tokens were paired with 1 SOL, setting an initial price of 0.00000000125 SOL ($0.000000085675) per CIF.
However, the token had no marketing on launch day. The developer deployed the token’s contract and listed CIF on DEX Screener but made no further attempt to attract buyers. Despite this lack of marketing, the token attracted some buyers who saw it on DEXScreener due to its similar name to Dogwifhat, NFT_Sloth claimed.
Blockchain data shows that at 9:41 am UTC on Dec. 12, the account beginning with Fm1w sold all 100 million of its tokens into the liquidity pool, receiving 1.24 SOL (approximately $85 at the time) in exchange. Two minutes later, the account beginning with AUKt also sold its coins, receiving 2.62 SOL ($180) in exchange.
At 9:56 am, the deployer account removed its share of the liquidity pool. By the time it did this, all of the CIF in the pool had been sold, causing the deployer to receive only SOL from its withdrawal. In addition, because the previous two transactions had crashed the price, the deployer received only 0.00203928 SOL ($0.14) from its withdrawal.
This alleged exit scam netted the developer approximately $265 worth of SOL in total.
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Catwifhat community takes over
After the first developer sold their tokens and removed liquidity, investors were left with essentially worthless tokens. However, NFT_Sloth says that several large investors decided to keep pursuing the project. They formed a team to take over its promotion. He claims that Joji also joined the team during this time and began promoting Catwifhat to his Telegram and X audiences. This led some “alpha callers,” speculators who make public bets on memecoins, to increasingly make calls in favor of Catwifhat, ultimately bringing even more investors into its community.
After the first developer exited, causing high slippage for traders. Yet during the first 10 days after launch, a single CIF investor managed to buy up over 55 million tokens and deposit them into the Raydium liquidity pool, providing enough supply for traders to keep trading. At the time, this investor’s share of the liquidity pool represented approximately 92% of its total value locked. They also became a social media manager for the new team and had access to its official X account. This centralization in liquidity eventually led to the second “rug pull,” NFT_Sloth claimed.
The project gets “rugged”... again
According to NFT_Sloth, this social media manager revoked his own access to the team’s X account on Dec. 24 and immediately afterward removed his liquidity. The result was a catastrophic slide in the token’s price. The current development team alleges that this action was a “liquidity rug pull,” he claimed, as the person who acted was a member of the team and controlled an excessive amount of the pool’s liquidity.
NFT_Sloth claimed that the team’s Telegram group and website admin also went silent after this event, providing further evidence of an exit scam.
Blockchain data shows that at 7:57 pm UTC on Dec. 24, two transactions from an account beginning with CWSy were confirmed. The first removed nearly 102 million CIF and 1,630 SOL from the Raydium liquidity pool. The second removed approximately 55 million CIF and 869 SOL.
Data from this time shows a massive slide in price for CIF. According to CoinGecko, the token peaked at $0.00431771 on Dec. 23, with the price being recorded as the day began at midnight. This implies that the token had a market cap of over $4.3 million at the beginning of that day. By the start of Dec. 24, the price had fallen to $0.00261692 and the market cap to $2.6 million, a decline of approximately 40%. At this point, the alleged rug pull had not yet occurred.
The next price point recorded is at the start of the following day, four hours after the alleged rug pull had occurred. At that moment, CoinGecko data shows a CIF price of $0.00098130, implying a market cap of $981,300 and a decline of 76%.
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Catwifhat regroups yet again
Despite this second “rug pull,” the team reportedly regrouped again. NFT_Sloth said he built a new website for the project while another investor, whom he refers to as “Sam B,” launched a new Telegram group. The old website was eventually taken offline for unknown reasons.
NFT_Sloth also credited X user Cryptochristo with breathing new life into the CIF community. They reportedly spent “ten hours a day” promoting the coin after joining the group, which helped to provide the public with new awareness of the project.
He stated that some members of the community are working on an NFT marketplace that will use CIF as its native token, providing CIF with utility. However, NFT_Sloth also argued that memecoins shouldn’t be judged entirely on their utility. “In all honesty, the utility side of meme tokens is kind of like the unsexy side,” he stated. “People are in it for the LOLs for the most part.” He claimed that Catwifhat’s ultimate goal is to “transcend out of the memecoin little bubble” and gain “mainstream” adoption, similar to Dogecoin (DOGE).
As of April 2, CIF has a price of $0.001451 and a market cap of $1,451,116. The 200 million tokens that the developer reportedly sold for $265 on launch day are now worth roughly $290,000, according to CoinGecko data.
The story of Catwifhat offers some hope for victims of rug pulls, as investors were reportedly able to recover from the losses caused by these events. However, most victims of other projects have not been able to recover from these events. In May 2023, rug pulls drained over $45 million from victims, more than the amount drained from decentralized finance exploits. Since April 2023, more than $35 million has been stolen from over 42,000 victims in rug pulls, according to security platform Blockfence.
