In a transfer signalling stricter oversight of the crypto sector, the UAE has lately intensified its regulatory stance. The newest improvement sees the nation launching an investigation into the $WAP token, endorsed by rapper Cardi B, whose standard music shares the identical identify. In response to a discover concerning the Solana-based token, the UAE is probing it for potential securities violations.

The UAE’s Securities and Commodities Authority (SCA) initiated a probe in opposition to the crypto token suspecting it might be a part of a pump-and-dump scheme ready to unfold. The SCA was alerted to the token by what its discover describes as a “distinguished Dubai-based enterprise capital agency” and related Emirati buyers.

WAP Token and Suspicions Surrounding It

With an animated cat as its mascot, the WAP token falls beneath the memecoin class with a circulating provide of 1 billion tokens, as per CoinGecko. Whereas the precise launch date of this token stays unclear, its official X page was created in September this 12 months.

In latest weeks, Cardi B, who boasts over 35 million followers on X, started selling the $WAP token throughout her social media platforms. On October 8, she shared a promotional publish together with a pockets tackle.

As per CoinTelegraph, a blockchain investigator going by the identify of Wazz flagged that the pockets tackle posted by the WAP web page was linked to a number of crypto scams.

Quickly after, blockchain knowledge platform BubbleMaps claimed that $500,000 (roughly Rs. 4.20 crore) price of WAP tokens had been suspiciously dumped hours after launch. BubbleMaps additionally mentioned that the WAP token is closely bundled – that might have consumers buy a number of models of the asset in a single transaction.

These components have raised pink flags amongst buyers and blockchain watchdogs, suggesting the memecoin might be problematic.

UAE’s Stance on the WAP Token

In its discover, the SCA mentioned that the promoters of this token together with Cardi B have employed a community of paid people who acquired the tokens without spending a dime by means of undisclosed monetary preparations.

As per the SCA, “Preliminary investigations recommend that the insiders related to the $WAP token, alongside numerous paid Key Opinion Leaders, are orchestrating a transparent pump and dump scheme. This scheme includes artificially inflating the worth of SWAP by means of strategic promotions, adopted by the systematic sale of their holdings, thereby inflicting vital monetary losses on unsuspecting retail buyers.”

The UAE authorities have joined forces with BubbleMaps to infer that this token is violating securities legal guidelines of the US in addition to the UAE.

As of now, Cardi B has not reacted to the event.

Earlier this week, Dubai’s Digital Belongings Regulatory Authority (VARA) issued a cease-and-desist order in opposition to seven crypto entities for working their companies with out buying the required approvals.