U.S. Oil [USOR] memecoin exploded by 268% over the past seven days. But on-chain data suggested caution to avoid massive losses despite its recent attractive returns.
The memecoin added another 53% to its explosive weekly rally amid U.S.-Venezuela tensions. With the outsized gains and social media hype, retail interest doubled.
Notably, a possible whale player or insider scooped $370,000 worth of the USOR, with social media commentators calling it ‘conviction’ from ‘smart money.’
However, over the past few hours, the token’s price crashed by 98%, dropping from $0.16 to $0.00394 and wiping out many retail traders.
The painful dump was flagged even by trading terminals tracking the memecoin price action, with Gecko Terminal placing a warning that read,
“This pool (USOR) is displaying unusual price action and volume. Please proceed with caution.”
So, AMBCrypto investigated the memecoin on key metrics to further gauge whether it was a safe bet or a risky one.
Token distribution vs. wallet cluster
According to Solscan, the Solana-based memecoin saw its holder count double from 23,000 to over 58,000 in less than three days as the price exploded.
However, the top 20 holders controlled 252 million USOR out of a total supply of 1 billion tokens—a 25% control.
When zoomed into the top 10 holders, they held 15% of the total supply. This meant the USOR memecoin had medium risk, suggesting that despite being tradable, it had some insider control that warrants caution.
For low-risk, the top 10 and 20 holders should be less than 15% or 25%, respectively.
Source: Solscan
The memecoin could be ‘high risk’ if the top 20 holders dominated over 40%-50% of the supply.
USOR faces insider manipulation risk
But the wallet cluster or connection between early wallets is more crucial than the top holders.
Bubblemaps’ cluster analysis helps gauge the distribution and overall coordination of token transfers, as well as the risk of insider manipulation.
Source: Bubblemaps
For USOR, the single largest address (7eCezm) controlled 3% of the supply, while the second-largest (4tzJxg) held 2.4%.
The two, alongside other wallets marked in yellow, formed a cluster that controls 26.18% of the total supply, suggesting team or insider coordination.
While not an outright ‘scam,’ it was an early project with massive insider control. But this also meant the team could likely trigger a rally or a dump with its moves.
So, the USOR price has a high risk of insider manipulation.
Final Thoughts
- The USOR explosive rally has attracted over 25,000 retail traders in the past three days.
- However, the memecoin could be prone to insider manipulation as cluster wallets controlled over 26% of the total supply.
