In a recent analysis, blockchain analytics firm Bubblemaps has raised alarm over the launch of the Solana-based AI token Ava, revealing that a group of 23 wallets linked to the token's deployer sniped a staggering 40% of its total supply right at launch. This revelation has sparked concerns about potential insider trading and manipulation, especially given the subsequent dramatic drop in the token's price, which plummeted 96% from its all-time high.

According to Bubblemaps, the wallets associated with the Ava deployer exhibited suspicious patterns that suggest coordinated buying activity. These wallets were primarily funded through exchanges such as Bitget and Binance within a narrow timeframe. Furthermore, they showed no previous blockchain activity before acquiring the AVA token supply, raising eyebrows about their intentions and the fairness of the token's distribution.

In the cryptocurrency space, 'sniping' refers to the practice of using automated trading bots to purchase newly launched tokens as soon as they become available, often at lower prices than the general market. The launch of Ava on the memecoin platform Pump.fun was intended to be decentralized and community-driven; however, the actions of this cluster of wallets have led to questions about the true nature of the token's introduction to the market.

The concentration of token supply among a small number of wallets can be a red flag for investors. It raises concerns about potential scams like rug pulls, where insiders withdraw liquidity or orchestrate mass sell-offs, leaving ordinary investors in a precarious position. This scenario can lead to steep price collapses, rendering tokens virtually worthless.

Bubblemaps utilized its Time Travel feature, a forensic analytics tool launched earlier this year, to track the historical distribution of the AVA tokens and identify the early insider activity. This tool aims to provide Web3 users with a better understanding of token distribution and to detect suspicious behavior within the crypto ecosystem.

The buying frenzy occurred just over a year after the AVA token's launch on November 13, 2024. At its peak, the token achieved a fully diluted valuation of $300 million by January 2025, positioning itself as a prominent utility token for autonomous AI agents on the Solana blockchain. However, recent data from CoinGecko shows that AVA has dropped more than 79% since its initial launch and a staggering 96% from its all-time high of $0.33, which it reached on January 15, 2025.

Ava, often referred to as “the HOLO AI intern,” is notable for being the first AI agent developed on the decentralized AI launchpad known as Holoworld AI. This platform allows users to create, play, and fund various agentic AI applications. Holoworld claims to have amassed a user base of over 1 million and boasts 700,000 AI “creations” to date.

As the cryptocurrency market continues to evolve, these incidents of potential manipulation serve as a reminder of the importance of transparency and fairness in token launches. Investors are advised to remain vigilant and conduct thorough research before engaging with new projects. Cointelegraph has reached out to Holoworld for comments regarding the activity of the sybil wallet cluster during the AVA token launch, but no response has been received at this time.

The ongoing discussions surrounding the AVA token highlight the complexities of cryptocurrency trading and the potential risks involved. As the industry matures, the need for robust regulatory frameworks and better practices to ensure fair market conditions becomes increasingly critical. Investors must navigate a landscape fraught with both innovation and potential pitfalls, making informed decisions more important than ever.