Solana Meme Coin Act I: The AI Prophecy Experiences Dramatic Crash
The Solana-based meme coin Act I: The AI Prophecy (ACT) witnessed a staggering 55% decline in value within the span of an hour on Tuesday, resulting in the liquidation of millions of dollars in positions on Binance. This event sparked a movement across social media urging users to boycott the widely-used centralized exchange, highlighted by the hashtag #BoycottBinance. Traders speculated that this wave of liquidations was triggered by Binance’s alteration of its leverage and margin tiers, which required users to increase the collateral needed to maintain leveraged positions, whether they were long or short. Those who failed to adjust their margins faced account liquidations.
In the aftermath of the adjustments made by Binance, CoinGlass reported that over $3.89 million worth of ACT positions were liquidated on the exchange, primarily from long contracts, as the token’s value plummeted. This situation led to a chain reaction of liquidations on other platforms, with Bybit and OKX seeing liquidations of $785,540 and $612,600, respectively. Over a 24-hour timeframe, the market cap of ACT fell dramatically from $179.4 million to $60.5 million, reflecting a 66% decrease according to DEX Screener.
In a subsequent blog post, Binance attributed the price drop to the actions of four users who sold approximately $1,015,000 worth of ACT on their platform. The exchange also announced that it would investigate the situation further. The official ACT X account, previously known as Twitter, addressed community concerns regarding the unexpected price fluctuations, stating that the movements were beyond their control and promising a detailed report once clarity was achieved regarding the incident and the solutions being developed.
As the ACT token’s value continued to decline, market maker Wintermute found itself entangled in the turmoil, as its traders engaged in selling ACT during the chaos. Specifically, four sales totaling $255,503 were made from Wintermute’s public wallet on the Solana decentralized exchange Raydium, followed shortly by three larger purchases on Binance amounting to $377,656. Evgeny Gaevoy, Wintermute’s founder and CEO, explained that this was a straightforward arbitrage strategy where their algorithm sold tokens on Raydium, a more expensive liquidity pool, while simultaneously buying them on Binance, which had a lower price, thus equalizing the two pools.
Meanwhile, the #BoycottBinance campaign gained traction as traders discovered additional meme coins on the exchange that had also suffered significant losses, including the Sui-based token Sudeng (HIPPO), which dropped 36.5% in just one hour. A pseudonymous crypto investigator, Crypto Rug Muncher, expressed on X that if the entire crypto community ceased using Binance, the exchange would lose its overwhelming influence in the industry. “They only list scams and are no better than other disreputable centralized exchanges,” the user claimed, urging others to withdraw their funds to render Binance irrelevant.
Despite the backlash, Binance remains the largest centralized exchange in the crypto market, holding a 34.7% market share as of December, according to a CoinGecko report. In comparison, Crypto.com holds a distant second place with just 11.2%. The recent controversy appears to have had a negligible impact, as Binance processed over $16.3 billion in spot trading volume in the past 24 hours, with Bybit trailing far behind at $2.4 billion.
Another anonymous on-chain analyst, Dethective, pointed out that a large percentage of Binance listings in 2025 are currently experiencing losses, averaging a 44% decline. Similar trends have been observed for 2024 through data compiled on a Dune dashboard. Some traders speculate that this trend is due to Binance’s tendency to list questionable tokens rather than focusing on reputable projects.
ACT was introduced on Binance in November, causing a massive surge in its value of over 2,000% within a mere ten hours, escalating from a market cap of $21 million to approximately $460 million. This rise occurred concurrently with criticism from the creator of the original Web2 ACT fundraising project, Amp, who has labeled the crypto token as a “scam,” continuing to disavow any affiliation with it.
“I am officially announcing my decision to boycott Binance,” stated one anonymous user on X, declaring that they had removed all their assets from the platform and would cease trading on Binance altogether. As scrutiny of the exchange has intensified, the value of BNB (BNB), the Binance Smart Chain’s native token, has seen a drop of 2.5% over the past day, despite VanEck’s recent application for a BNB ETF.
Binance has yet to respond to inquiries from Decrypt regarding this situation.
