Is there another demon money? After LAB tokens skyrocketed 5 times, they suddenly crashed 84%. On-chain detective ZachXBT blows the lid on the inside story.

$LAB Recently experiencing extreme volatility, surging 500% within days and then crashing 84%, leading to many investors liquidating their positions. Well-known detective ZachXBT questions the team and market makers for manipulating the market and is offering a reward for insider information.

LAB Short-term surge and plunge, market sees “rollercoaster trading”

Recently, the crypto market has again seen cases of extreme volatility. Meme and AI concept tokens $LAB surged over 500% in just a few days, attracting many retail and short-term traders to chase the high, but then plummeted 84% in a very short period, triggering panic and massive liquidations.

Based on on-chain data and market observations, after abnormal price spikes on centralized exchanges (CEX), trading volume rapidly increased, and community platforms began to flood with promotions of “the next 100x coin” and “AI new narrative leader.” However, near the peak, large amounts of tokens started to be sold off collectively, causing the price to collapse instantly.

Image source: X/@zachxbt The price of $LAB on centralized exchanges (CEX) experienced abnormal surges, and near the peak, large amounts of tokens were sold off collectively, leading to an instant price collapse.

This intense volatility quickly drew the attention of well-known on-chain detective ZachXBT. He publicly questioned suspicious market manipulation by the $LAB team and market makers, even offering a $10,000 reward for insider information. ZachXBT pointed out that the price movement of $LAB differs greatly from natural market trading, especially in liquidity, order book depth, and address activity, showing clear signs of artificial manipulation.

ZachXBT points out team operations, questions exchange collusion

According to ZachXBT’s public statements, the issue with $LAB is not just a simple “meme coin crash,” but resembles a carefully planned price manipulation scheme.

He believes that the abnormal price surges of $LAB on some centralized exchanges may involve internal market-making arrangements, low circulation control, and coordinated actions by the team or related addresses.

Especially during the price rally, large trading volumes concentrated in a few trading pairs and specific periods do not align with natural retail trading characteristics. More controversially, some on-chain addresses are suspected to have pre-positioned before the surge and offloaded large amounts near the peak.

ZachXBT notes that this pattern is very similar to past cases of “insiders front-running the pump and dumping on retail investors.” He also criticizes that more and more small token projects are using low circulating supply combined with centralized exchange listings to create “explosive growth” in a short time, attracting FOMO and then quickly dumping. After the news broke, the price of $LAB further came under pressure, and questions about project transparency and exchange review mechanisms quickly intensified.

Meme coin market enters “high control era,” retail risks continue to grow

In recent years, the meme coin and AI concept token craze has reignited, but the market structure is notably different from 2021. Previously, meme coins relied more on organic community spread and retail on-chain promotion, but now many new tokens from the outset depend heavily on market makers, KOL promotion, and exchange liquidity arrangements.

Some projects even deliberately suppress circulating supply so that small amounts of capital can quickly push up the price. While this model can generate astonishing gains in a short time, it also makes prices more susceptible to control by a few. Especially when market liquidity is insufficient, large holders selling off can cause sudden crashes of 30% or even over 80%.

Analysts point out that many meme coins are gradually shifting from “community cultural assets” to high-leverage, highly volatile short-term trading tools. Many retail investors are not truly buying into the project fundamentals but are driven by the hope of “the next explosion myth.”

The AI hype further amplifies this sentiment. As long as a project’s name is linked to hot keywords like AI, Agent, Data, even without actual products, it can quickly attract market funds chasing the trend.

On-chain transparency does not equal fairness; markets begin to reassess regulatory issues

The $LAB incident also highlights that while the crypto market emphasizes on-chain transparency, transparency does not mean fairness. Even if all transaction records are publicly accessible, most retail investors find it difficult to identify insider operations, related addresses, and market-making structures in real-time. Especially in environments mixing centralized exchange liquidity and on-chain activity, price formation processes are often more complex than they appear.

Some market participants believe that regulators may start to intervene more actively in such events in the future. Particularly when tokens involve obvious price manipulation, insider trading, or false liquidity, they may increasingly be viewed as akin to illegal market manipulation in traditional securities markets.

On the other hand, some crypto communities support ZachXBT’s ongoing disclosures, believing that in the absence of mature regulation in the on-chain world, on-chain investigators and independent researchers are playing a role similar to “civilian financial police.” For many retail investors, the extreme volatility of $LAB may serve as a reminder: in this market of high liquidity, attention, and emotional cycles, the most scarce asset might not be the next 100x coin, but the ability to identify risks.