Crypto sleuth ZachXBT under fire for selling $3.87M in unsolicited meme tokens

ZachXBT, a well-known crypto investigator, has sold around $3.87 million worth of meme tokens sent to his wallet without request. The move has sparked criticism, particularly as some of the funds came from projects he had previously scrutinised. His work in exposing fraud has made him a prominent but controversial figure in the industry.

The latest debate follows a pattern of donations from major crypto firms, including Hyperliquid, which gifted tokens worth up to $600,000. Questions have arisen about whether these contributions influence his investigative focus.

The controversy began when an anonymous developer transferred 50% of a newly created meme token’s supply to ZachXBT’s wallet. At its peak, the token’s market value briefly hit $88 million. Instead of holding or returning the tokens, ZachXBT sold 16,059 SOL, equivalent to roughly $3.87 million, prompting accusations that he prioritised personal gain over potential victim restitution.

This isn’t the first time donations have raised eyebrows. In 2023, ZachXBT faced a lawsuit, leading to the creation of a community defense fund. Major crypto exchanges like Binance and Bybit contributed, alongside investment firm Paradigm and wallets linked to Hyperliquid. After receiving 10,000 HYPE tokens—worth as much as $600,000—from Hyperliquid, critics noted a decline in ZachXBT’s public scrutiny of the platform. Further suspicions arose when Polymarket-linked wallets allegedly profited $1.2 million ahead of one of ZachXBT’s posts, though no direct connection was ever confirmed. Observers have also pointed out that several donors to his defense fund were never later investigated by him, despite his reputation for exposing fraud. Over his career, ZachXBT has uncovered over $500 million in crypto-related scams, making his selective focus all the more noticeable.

The sale of unsolicited meme tokens has intensified scrutiny of ZachXBT’s financial decisions and potential conflicts of interest. With a history of high-profile investigations and substantial donations from industry players, his actions continue to draw both support and scepticism. The debate highlights ongoing tensions between investigative integrity and financial incentives in the crypto space.