YZY: From controversy to blockchain, how do celebrity tokens reshape the business landscape?

In the cryptocurrency market, celebrity tokens have become a new investment hotspot. YZY, launched by American rapper Ye, has attracted widespread market attention. This project not only represents an attempt by a commercial brand to enter the blockchain space but also reflects a trend where celebrities bypass traditional e-commerce restrictions through decentralized technology. So, what exactly is YZY? Where is its value? And what risks should investors be cautious of?

Core Value Proposition of YZY

YZY is the official digital currency created by Ye for his Yeezy brand, primarily used for purchasing goods on the Yeezy official website. The background of this design is noteworthy: Ye has faced termination of collaborations with major business partners due to a series of controversial statements, including brands like Adidas and Balenciaga ending their partnerships. Subsequently, Shopify also shut down his online store. Against this backdrop, YZY emerged—serving as an independent payment system that allows the Yeezy brand to bypass traditional e-commerce platform restrictions and transact directly with consumers.

Technically, YZY is built on the Solana blockchain, which grants it advantages of fast transactions and low fees. Compared to other payment methods, the high efficiency of the Solana network makes YZY particularly suitable for e-commerce scenarios, providing users with a smoother shopping experience.

Evolution of Kanye West and the Yeezy Empire

To understand YZY, it is essential to know its founder. Ye (born Kanye West on June 8, 1977) is a significant figure in the global music industry. Starting as a producer, he produced albums for multiple artists before achieving solo success with “The College Dropout.” His Yeezy brand, in collaboration with companies like Adidas and Gap, has built a vast business empire. Data shows Ye has sold over 160 million records worldwide, won 24 Grammy Awards, and has been listed multiple times among Time magazine’s most influential people.

However, in recent years, Ye’s controversial statements have dealt heavy blows to his business empire. These controversies have directly led to the termination of collaborations with several companies and platform restrictions, becoming a key driving force behind his shift into the blockchain space.

The Twists and Turns from Concept to Launch of YZY

The development of YZY has been dramatic, quite different from the steady progress typical of traditional crypto projects.

In early February 2024, Ye hinted at having contact with Coinbase CEO Brian Armstrong, sparking market speculation. However, he later clarified on social media that he would not issue a personal token and criticized those hyping “celebrity coins” as exploiting fans. He even mentioned that someone offered him $2 million to issue a token, which he declined. These remarks caused market expectations for “Ye issuing a token” to plummet. On the Polymarket prediction platform, the probability of “Kanye issuing a token in February” dropped from 40% to 13%.

The turning point came weeks later. Several industry insiders revealed to CoinDesk that Ye was secretly preparing to launch the YZY token. According to reports, initial emails signed by someone claiming to be Hussein Lalani, purportedly the Yeezy CFO, were received, followed by access to YZY-related documents. Insiders disclosed that YZY was scheduled to start sales at 18:00 on Thursday on the Yeezy website, but due to concerns that the “Argentine President Token” incident might make the market more cautious about celebrity tokens, the project team decided to delay the release until Friday.

Interestingly, Ye’s initial plan was to mimic the Trump token model—controlling 80% of the tokens himself, similar to how Trump’s CIC Digital held a large share of the TRUMP token. After internal negotiations, Ye agreed to reduce his stake to 70%.

Token Economics and Distribution Mechanism of YZY

The token distribution structure of YZY is its most controversial and noteworthy aspect:

Token Allocation:

• 70% held by Ye personally
• 20% allocated to investors
• 10% for market liquidity

This highly centralized ownership structure has raised reasonable concerns in the market. Such a large proportion of personal holdings could pose price manipulation risks and contradict the decentralized ethos of cryptocurrencies.

To address these concerns, the 70% of tokens owned by Ye are subject to phased unlocking, with some tokens locked for up to 12 months. This design aims to prevent large-scale sell-offs and maintain relative price stability of YZY.

The value of YZY is supported by two main factors: its utility as the official payment tool for the Yeezy brand and Ye’s personal fan economy. This gives YZY a dual characteristic of both a practical token and a meme token.

Analysis of YZY’s Core Features

1. Celebrity Effect Driven

Unlike most crypto projects relying solely on technological innovation, YZY’s value mainly derives from Ye’s cultural influence and fan economy. As a meme token, its price fluctuations largely depend on the founder’s popularity and market sentiment.

2. Advantages of the Solana Ecosystem

Built on the Solana blockchain, YZY benefits from the network’s high transaction speed and low fees. Compared to Ethereum or other public chains, Solana is more suitable for payment applications, offering users a better transaction experience.

3. Clear Commercial Use Cases

Unlike many meme coins that are purely speculative, YZY functions as the official payment tool for the Yeezy brand, with real use cases. This provides a value foundation beyond mere hype.

4. Highly Centralized Control

Ye personally controls 70% of the tokens, which, while controversial, grants him absolute authority over the project’s direction, facilitating quick decision-making and execution.

Comparison of YZY with Other Celebrity Tokens

YZY vs TRUMP

YZY and the TRUMP token issued by Trump are currently the two most prominent celebrity coins. Both are highly centralized tokens, but they differ in several aspects.

Ownership Structure: YZY is held 70% by Ye himself, while TRUMP is held 80% by Trump’s CIC Digital. Both show high concentration.

Profitability: TRUMP has demonstrated strong earnings. Data shows that TRUMP generated nearly $100 million in trading fees within just two weeks, mostly from the fee-sharing mechanism of Meteora Exchange. This provides a reference profit model for YZY.

Market Performance: After issuance, TRUMP’s price surged, with a market cap exceeding $14.5 billion at its peak, then retraced by about two-thirds. Such volatility serves as a warning for YZY investors—long-term valuation should be carefully assessed.

Investor Distribution: Data analysis indicates that TRUMP’s profits are unevenly distributed. At least 50 large investors each made over $10 million, while around 200,000 retail investors suffered losses. Similar disparities could occur with YZY, so retail investors should be especially cautious.

YZY vs Argentine President Token

YZY and the Libra token promoted by Argentine President Milei share similarities but also notable differences.

Similarities: Both are promoted by well-known public figures leveraging personal influence.

Differences: YZY has a clear use case (Yeezy brand payments), whereas Libra was promoted as a “private project to boost Argentina’s economy” but lacked concrete implementation plans.

Market Lessons: Libra serves as a cautionary example. After Milei promoted Libra, its price briefly rose but then plummeted, causing significant losses for thousands of investors. The incident even triggered political controversy, with calls for Milei’s resignation. The YZY project team, wary of the Libra event, delayed the launch—fearing that a similar market reaction and regulatory risks could occur if the timing was too close.

Future Outlook of YZY: Opportunities and Risks

Positive Factors

Ye’s large fan base and global influence provide YZY with significant potential user engagement. The practical payment application of Yeezy adds value beyond meme coins. The phased unlocking mechanism helps buffer price volatility and enhances market stability.

Challenges and Risks

Ye’s personal holding of 70% poses price manipulation risks. Past controversies have led to the termination of collaborations with multiple platforms, introducing uncertainty about the project’s long-term development. Historical data shows that similar celebrity tokens often experience rapid devaluation after short-term hype, with Libra as a cautionary example. Whether YZY can break this pattern largely depends on Ye’s long-term commitment and the development of the Yeezy brand.

Overall Observation

YZY exemplifies a new phenomenon: traditional business figures seeking breakthroughs through blockchain technology. Compared to cases like TRUMP and Libra, YZY has clearer commercial use cases and payment functions. However, its highly centralized ownership structure, the founder’s controversial background, and the overall instability of celebrity tokens pose investment risks. For ordinary investors, rationally assessing its value, being cautious of short-term hype, and focusing on long-term development prospects are essential when participating in the YZY ecosystem.