A Solana-based memecoin called Project Kimchi suffered a dramatic collapse on October 23, 2026, with its market capitalization plunging more than 98% from approximately $15 million to $284,000 after Pump.fun co-founder Alon removed a promotional repost on X.
The token’s rapid rise followed a promotional image published by cryptocurrency trader Kimchi, known as @kimchi1x, featuring a QR code directing users to the newly launched asset on Pump.fun. Alon’s subsequent repost amplified attention, helping propel the token’s valuation above $10 million within minutes.
However, the rally reversed sharply after Alon withdrew his repost and Kimchi deleted the original promotion. Kimchi also removed references to Pump.fun from his X biography, intensifying speculation about the circumstances surrounding the launch.
Market data cited by TokenPost showed approximately $9.3 million in trading volume over 24 hours. Other observations placed the token’s capitalization as low as $150,000, reflecting substantial volatility and differences in reporting times.
Blockchain Investigators Flag Suspicious Trading Activity
Blockchain analytics firm Lookonchain reported that Kimchi’s wallet received approximately 500 million KIMCHI tokens before the promotional activity. The firm separately estimated that wallets purchasing tokens early in the rally generated more than $385,000 in combined trading profits.
These findings intensified scrutiny of the launch, although the identified transactions do not independently establish insider trading, coordinated manipulation or the identities of the wallet operators.
The incident also follows an earlier KIMCHI launch investigated by blockchain intelligence company Bitquery. Its October 21 analysis identified three interconnected wallets that purchased approximately $7,332 of a newly issued KIMCHI token and subsequently sold those holdings for $111,748, generating roughly $104,416 in gains.
Bitquery’s findings concern a separate token launch on October 20 and should not be confused with the October 23 collapse. The distinction is significant because multiple tokens bearing the Kimchi name have circulated, creating opportunities for mistaken identification and speculative trading.
Meanwhile, social media users questioned whether Kimchi’s account had been compromised or whether the promotional campaign was deliberately misleading. Neither explanation has been independently established.
Pump.fun Partnership Faces Scrutiny Following Collapse
The controversy emerged shortly after Pump.fun confirmed a creative partnership with Kimchi, whose public profile had grown through high-profile cryptocurrency trading activity. Alon previously praised Kimchi’s ability to connect cryptocurrency culture with mainstream audiences and indicated that the trader would contribute to Pump.fun’s creative direction.
Following the incident, some investors demanded compensation, arguing that the co-founder’s repost had encouraged participation in the token.
However, there has been no verified announcement of a refund arrangement, and neither party has provided a confirmed explanation establishing responsibility for the collapse. Separately, Lookonchain reported that Pump.fun’s daily revenue declined approximately 16%, from $1.61 million to $1.35 million, over two days. Active addresses reportedly fell 11%, from 178,539 to 159,492, although no causal connection to the controversy has been demonstrated.
The episode highlights the risks associated with influencer-driven memecoin launches, where social media endorsements can rapidly influence valuations despite limited transparency surrounding token ownership and trading activity.
Importantly, the decline in market capitalization does not represent an equivalent amount of realized investor losses, as valuations reflect prevailing token prices rather than total capital invested.
