ZENAI Token's Rapid Rise Raises Fraud Concerns

The swift emergence of new tokens on platforms such as Pump.fun has captivated traders and investors seeking quick profits, but not all tokens are as valuable as they appear. This week, the $ZENAI token, a memecoin associated with a Solana-based AI project called ZenAI, has garnered significant attention. Despite its increasing presence across analytics platforms, on-chain data has raised serious concerns about the token's legitimacy, suggesting it may be part of a scheme to defraud investors.

The $ZENAI token, launched on June 3, 2025, via Pump.fun, quickly gained market interest with a rapidly growing number of holders and surging trading volume. However, a closer examination reveals a questionable pattern of behavior designed to mislead both platforms and traders. The token's holder count, which jumped from approximately 0 to over 40,000 in just four days, is particularly suspicious given that the Telegram group had only around 3,000 users and 1,600 followers on X (formerly Twitter). This discrepancy suggests that the holder count may be artificially inflated.

Trading patterns further support this hypothesis. Almost 83% of all wallets interacting with the token had no previous trading history, and more than half of the trading volume came from these newly created addresses. This indicates that the token's activity is likely driven by bots to simulate high engagement. The size of transactions also raises concerns, as almost half of all trades were for amounts under $2, which is an unusually small amount for real users to trade, especially considering the fees involved. These bot-driven trades appear to be attempts to create organic-seeming growth curves for wallets and trading activity across platforms, aiming to enhance the token's legitimacy and adoption.

Despite public-facing data suggesting decentralization and community ownership, an on-chain analysis reveals a different story. Over 80% of the $ZENAI token supply is concentrated in the top 200 wallets, with only 3 of the top 25 wallets not linked to the deployer wallet or wallets holding the deployer wallet. Initially, more than 70% of the token supply was acquired by the developer wallet, which then redistributed the tokens to a network of proxy wallets. These proxy wallets received direct payments of SOL from the deployer and were used to make large, simultaneous purchases of the token. The timeline of wallet activity further supports this, as many of the top wallets involved in the sniping had been inactive for four to five months before being reactivated and funded with SOL from the same network of proxy wallets. This strategy is known in crypto fraud, where scammers buy aged, previously used wallets to give the appearance of legitimacy when origin-tracking analysis tools are used.

The appearance of legitimacy and popularity is being created to attract retail traders, but the token's structure is largely under the control of the deployer’s wallet. The supposed airdrop to the community seems to be a publicity stunt, and the token's stability is likely due to careful price management. However, when the community sees how much power the deployer and their proxy wallets really have, it usually results in a significant drop in trust and price. Whether the team plans an exit in the near future or is just set up for one is unclear, but the data suggests an imminent exit.

In the fast-paced realm of memecoins, it is crucial for traders to look beyond price charts and social media platforms. On-chain visuals tend to clarify—and in the case of ZEN AI, they clarify a highly coordinated scam. Traders and investors should conduct thorough research before buying any cryptocurrency or investing in any services.