{"investigation":{"slug":"wallstreetbets","entity_name":"WallStreetBets","trust_score":5,"severity_base":null,"score_modifier":0,"confidence":1,"status":"published","content_type":"investigation","summary":"The 'WallStreetBets' brand has been exploited in at least two distinct crypto fraud incidents: a 2021 Telegram pre-mine scam using a fake 'WallStreetBets – Crypto Pumps' channel that stole over $2.1 million in BNB and ETH, and a 2023 Ethereum meme token (WSB Coin) that surged to a $50 million market cap before insiders allegedly dumped $635,000 worth of tokens within days of launch, collapsing the price by over 90%. Neither token was authorized by Reddit or the r/WallStreetBets subreddit, and ZachXBT publicly identified the alleged perpetrators in the 2023 incident.","sections":[{"content":"The r/WallStreetBets subreddit, famous for coordinated retail trading activity during the 2021 GameStop short squeeze, has repeatedly had its brand exploited by unauthorized crypto operators. At least two distinct fraud schemes have used the WallStreetBets name to attract victims: a 2021 Telegram impersonation scam and a 2023 Ethereum meme token rug pull. In both cases, the WallStreetBets forum administrators publicly disavowed any affiliation. The 2023 token self-described as the 'official unofficial memecoin of r/wallstreetbets,' a framing designed to imply community endorsement while providing legal cover for its unauthorized use of the brand.","heading":"Overview and Brand Exploitation","sources":[],"severity":"medium"},{"content":"In early May 2021, a Telegram account operating under the name 'WallStreetBets – Crypto Pumps' executed a pre-mine sale scam targeting members of the r/WallStreetBets community. The account offered users the opportunity to purchase a token called 'WSB Finance' before its alleged exchange listing, directing victims to send Binance Coin (BNB) or Ethereum (ETH) to a designated wallet address and contact a 'token bot' to receive coins. No tokens were ever delivered. The operators then sent a follow-up message claiming a technical issue with the bot and instructing victims who had already sent funds to wire the same amount again or lose their initial investment — a classic doubling scam mechanic. On approximately May 4, 2021, approximately 3,451 BNB (worth roughly $2.1 million at BNB prices of approximately $625) were withdrawn from the wallet. An additional approximately 151.4 ETH (worth approximately $533,000) was also reported stolen. The Telegram account was subsequently deleted. The perpetrators' final message read: 'Buying Lambo now.' The r/WallStreetBets forum confirmed the Telegram account had no affiliation with the subreddit and pinned a warning at the top of the forum. Bloomberg reported on the incident, confirming its scope and the lack of official affiliation.","heading":"2021 Telegram Scam: WallStreetBets – Crypto Pumps","sources":[],"severity":"medium"},{"content":"On May 2, 2023, a token called WSB Coin launched on Ethereum, marketing itself as the 'official unofficial memecoin of r/wallstreetbets.' The token allocated 10% of supply to a supposed WallStreetBets treasury and 5% to moderators, while publicly claiming no team allocation. Despite these assurances, the token's market capitalization surged to approximately $50 million within three days of launch, fueled by association with the WallStreetBets community identity. On May 4, 2023, on-chain investigator ZachXBT publicly reported that zjz.eth — identified as Jordan Zazzara, operator of the r/WallStreetBets moderation bots — had sold approximately 6.86 billion WSB tokens via Uniswap for 334 ETH, valued at approximately $635,000. ZachXBT's investigation further revealed that a second insider, Noor Al-Enaney (Twitter: @is_unpopular, alias OIP), co-signed the multisig treasury transaction enabling the dump. The token's price collapsed from an all-time high of approximately $0.00067 to approximately $0.000029, a decline exceeding 90% within 24–48 hours. PeckShield, an on-chain security firm, independently identified the large token dumps and their conversion to ETH. The subreddit moderator known as WSBMod subsequently issued public threats of police and FBI reports against the alleged dumpers, writing: '@zjzWSB and @is_unpopular are 100% guilty scammers who manipulated me and earned my trust likely with bad intentions from the start.' In response, zjz.eth alleged that WSBMod was himself the architect of the scheme, claiming that WSBMod had secretly siphoned approximately $25,000 through large undisclosed airdrops to himself that were subsequently sold. zjz.eth later offered to create a refund mechanism for pre-dump token holders. The Ethereum contract address for WSB Coin is 0x8df586aa346c3d9d1c99a21316a2735d71355ec8.","heading":"2023 Ethereum Meme Token Rug Pull (WSB Coin)","sources":[],"severity":"medium"},{"content":"Pseudonymous blockchain investigator ZachXBT played a central role in exposing the 2023 WSB Coin rug pull. ZachXBT publicly reported on May 4, 2023 that zjz.eth had 'suddenly dumped a large portion of the WSB team supply for $635k (334 ETH).' ZachXBT's investigation identified zjz.eth as Jordan Zazzara and traced the multisig co-signer to Noor Al-Enaney (OIP / @is_unpopular). The reporting was picked up by CoinTelegraph, The Block, BeInCrypto, CoinEdition, and other Tier 2 crypto news outlets within hours. ZachXBT's thread noted that the founder had reached out to him in November 2022, months before the token launched, which raised additional concerns about the pre-meditated nature of the alleged fraud. ZachXBT has not been identified as having been involved in the 2021 Telegram scam investigation.","heading":"ZachXBT Investigation","sources":[],"severity":"medium"},{"content":"Both fraud schemes caused direct financial harm to retail investors who were drawn in by perceived association with the r/WallStreetBets community, a Reddit forum with millions of members. In neither case did Reddit or the subreddit's official administrators authorize the use of the WallStreetBets name or brand. The 2021 scam specifically targeted subreddit members by operating a Telegram group designed to appear as an official crypto extension of the community. The 2023 token exploited the same brand recognition via the phrase 'official unofficial memecoin,' a formulation that implied insider endorsement while avoiding explicit false claims. Two weeks before the 2021 Telegram scam was executed, WSB administrators had reportedly warned members about fraudulent offers exploiting the forum's name, suggesting the operators were aware of the warning environment and proceeded regardless.","heading":"Unauthorized Brand Use and Community Impact","sources":[],"severity":"medium"}],"timeline":[{"date":"2021-04-19","event":"WallStreetBets forum administrators warn members about fraudulent offers using the subreddit's name in crypto promotions.","source":"","source_url":"https://cryptopotato.com/members-of-wallstreetbets-forum-alleged-in-telegram-crypto-scam-stealing-2m-in-bnb-and-eth/"},{"date":"2021-05-04","event":"Approximately 3,451 BNB (worth ~$2.1 million) withdrawn from the 'WallStreetBets – Crypto Pumps' Telegram scam wallet. Approximately 151.4 ETH also reported stolen. Total losses estimated at over $2.6 million.","source":"","source_url":"https://www.coindesk.com/markets/2021/05/05/wallstreetbets-members-may-have-lost-over-2m-to-telegram-crypto-scam-report"},{"date":"2021-05-05","event":"CoinDesk reports on the Telegram 'WallStreetBets – Crypto Pumps' scam. Bloomberg confirms no affiliation with the official subreddit. The Telegram channel is deleted.","source":"","source_url":"https://www.bloomberg.com/news/articles/2021-05-04/wallstreetbets-members-targeted-in-telegram-cryptocurrency-scam"},{"date":"2022-11","event":"WSB Coin founder reportedly contacts ZachXBT months before the token's eventual launch — a detail ZachXBT later notes in his May 2023 investigation.","source":"","source_url":"https://beincrypto.com/wallstreetbets-meme-coin-wsb-alleged-rugpull/","date_original":"2022-11-01"},{"date":"2023-05-02","event":"WSB Coin launches on Ethereum, self-described as the 'official unofficial memecoin of r/wallstreetbets.' The token allocates 10% to a community treasury and 5% to moderators, claiming no team allocation.","source":"","source_url":"https://coinedition.com/wallstreetbets-wsb-token-tanks-90-amid-rug-pull-allegations/"},{"date":"2023-05-04","event":"WSB Coin reaches a reported peak market capitalization of approximately $50 million within three days of launch. Shortly after, ZachXBT publicly reports that zjz.eth (Jordan Zazzara) sold approximately 6.86 billion WSB tokens for 334 ETH (~$635,000) via Uniswap. Co-signer identified as Noor Al-Enaney (OIP / @is_unpopular). Token price collapses over 90% within hours.","source":"","source_url":"https://cointelegraph.com/news/wallstreetbets-mod-dumps-meme-coin-worth-635k-in-alleged-rug-pull"},{"date":"2023-05-04","event":"WSBMod issues public threats of police and FBI action against zjz.eth and @is_unpopular, calling them '100% guilty scammers.' zjz.eth counter-alleges that WSBMod secretly siphoned ~$25,000 via undisclosed airdrops.","source":"","source_url":"https://u.today/wallstreetbets-wsb-coin-update-main-suspect-offers-refund-and-tells-his-story"},{"date":"2023-05-05","event":"zjz.eth publicly offers to create a refund mechanism for pre-dump token holders. Token price remains approximately 92.8% below its all-time high.","source":"","source_url":"https://u.today/wallstreetbets-wsb-coin-update-main-suspect-offers-refund-and-tells-his-story"}],"sources_used":[],"source_tags":["zachxbt"],"addresses":[],"reviewed":false,"reviewed_by":null,"model_used":"claude-sonnet","created_at":"2026-05-04T16:05:01.681539+00:00","updated_at":"2026-08-29T01:35:58.489+00:00"}}