Meteora and Kelsier Execs Hit with $69M Class-Action Lawsuit Over M3M3 Collapse
A collective legal action has been initiated in the US District Court for the Southern District of New York, targeting the decentralized exchange Meteora, the venture capital firm Kelsier Labs, and various executives, accusing them of fraudulent activities concerning the launch of the M3M3 token.
As per the complaint filed on April 21, investors assert that Meteora and Kelsier Labs “deliberately misrepresented” the M3M3 token’s debut in December 2024, leading to losses exceeding $69 million from December 2024 to February 2025.
The lawsuit identifies the venture capital company Kelsier Labs LLC, along with its principal members, Charles Thomas Davis and his sons Hayden and Gideon Davis, as defendants alongside Meteora and Chow. Meteora is an unincorporated, decentralized trading platform.
Kelsier Labs Market Scheme
The complainants argue that the defendants portrayed themselves as “reliable figures in the Solana ecosystem” to cultivate investor trust. However, they devised a scheme that manipulated token sales and artificially escalated the price.
Investors received assurances regarding a transparent and inclusive launch. They also learned that staking incentives would derive from transaction fees linked to Meteora. The plaintiffs now claim these statements intentionally deceived them.
As stated in the grievance, those involved with the initiative discreetly obtained nearly 95% of the $M3M3 token availability through a web of more than 150 wallets.
They subsequently limited access to public buyers during the initial trading period, reportedly excluding retail investors while artificially boosting the price through internal transactions.
Market Manipulation
As the price escalated, the insiders faced accusations of offloading their assets onto the market, sparking a rapid decline within days.
“Collectively, the Defendants crafted the $M3M3 Token and strategized its launch on Meteora with the intention of unlawfully benefiting themselves at the cost of the unsuspecting investing public,” the complaint additionally contends.
Meteora’s launch of several controversial tokens, such as those for Trump, Melania, and Libra, has led to legal challenges similar to those encountered with previous token executions.
During the LIBRA controversy, insiders exploited private liquidity frameworks to profit from peak prices, leaving everyday traders uninformed. These same groups were also involved with MELANIA, another memecoin launch that resulted in losses for retail investors.
