Solana Chain Meme Coin HNUT Plunges 99% Warning: How to Identify and Prevent Rug Pull Risks

For many cryptocurrency investors, chasing Meme Coins on high-speed blockchains like Solana has become a high-risk speculative activity. However, events such as the overnight loss of over $70 million in market value serve as a stark warning.

This article will analyze the typical features of the recent HNUT token Rug Pull incident and explore how to effectively identify and manage such risks when trading on platforms like Gate.

• Event Recap: HNUT (Holly The Squirrel) surged over 700%, with a market cap reaching $70.94 million, then experienced a 99% price crash in a short period, nearly wiping it out.
• Causes of Risk: The incident exposed that Meme Coins heavily rely on market sentiment, lack intrinsic value support, and that manipulation techniques on the Solana chain—such as creating “fake wallet armies”—can artificially create a false sense of prosperity.
• Identification and Prevention: Investors can avoid risks by analyzing on-chain data (such as liquidity pool changes, large transfers), using security tools, and trading on platforms like Gate that provide comprehensive trading data and risk control alerts.

Full Review of the HNUT Incident: A textbook-style Boom and Bust

In late December 2025, a Meme token called HNUT (Holly The Squirrel) attracted widespread attention on the Solana chain. It originated from a humorous graphic and text about a squirrel on social media, quickly spreading due to its simple and engaging narrative. Within just 24 hours, its price soared over 700%, reaching $0.055, with a market cap of approximately $55.03 million, ranking among the top three in 24-hour trading volume on Solana. During this period, trading was active, the number of holding addresses exceeded 10,000, and 24-hour trading volume was about $5.5 million.

However, multiple on-chain monitoring platforms (such as Crypto Scope and PeckShield) issued alerts almost simultaneously, indicating abnormal liquidity activity and data patterns, clearly marking “Rug Pull” risks. Shortly after the alerts, disaster struck. HNUT’s price plummeted 99% in a very short time, from a high of about $0.07 to less than $0.0003, with tens of millions of dollars in market value evaporating instantly, and liquidity pools shrinking sharply.

The High-Risk Ecosystem of Meme Coins on the Solana Chain

The sudden collapse of HNUT is not an isolated event; it deeply reflects the inherent high risks within the Solana Meme Coin ecosystem.

• Sentiment-Driven and Lack of Value: Like many Meme Coins, HNUT’s rise was entirely driven by market sentiment and community hype, with no real application scenarios or intrinsic value support. Such purely hype-driven increases are extremely fragile; once sentiment reverses or major investors withdraw, the price loses support.
• Fake Trading and Market Manipulation: On-chain researchers point out that manipulation techniques on Solana include creating large “fake wallet armies” to generate false trading volume and market hype. Manipulators split funds across multiple wallets to conduct wash trading, creating the illusion of liquidity and active trading, attracting uninformed retail investors, and setting the stage for “pump and dump” or “Rug Pull” schemes.
• Easy Token Creation and Regulatory Gaps: The high speed and low cost of the Solana network make it very easy to create and trade Meme Coins. Many projects are quickly launched via platforms like Pump.fun or LetsBonk, but many lack transparency, are unverified, and some creators remain anonymous, providing fertile ground for fraud.

Current Market Data and Risk Indicators Analysis

The table below consolidates key price data and related market risk indicators from the HNUT incident, providing quantitative references for understanding such events:

How to Safely Trade on Platforms like Gate and Identify Potential Risks

In a complex and volatile market, investors can take the following measures to better protect their assets while pursuing opportunities:

1. Use on-chain tools for due diligence
2. Before investing in any token, especially new Meme Coins, proactively check on-chain data. Focus on:
   • Liquidity pool lock status: whether funds are locked and the lock-up period.
   • Distribution of large holdings: beware of tokens overly concentrated in a few addresses (“whale” wallets).
   • Contract audit status: prioritize projects audited by reputable security firms, though this does not eliminate all risks.
   • Real-time alerts: follow security organizations like PeckShieldAlert on social media for timely disclosures of suspicious transactions and risky contracts.
3. Be cautious of unnatural market data
   1. Sudden trading volume spikes with shallow order book depth: may indicate wash trading to create false prosperity.
   2. Disconnection between social media hype and fundamentals: when a token is only hyped on social media without substantive progress or transparent information, stay alert.
4. Operate on platforms like Gate that provide a sound trading environment
5. Choosing a platform that emphasizes security and user education is crucial. When trading on Gate, investors can:
   • Access comprehensive market data: use depth charts, historical K-line charts, and technical analysis tools to analyze price trends calmly rather than blindly following the crowd.
   • Pay attention to platform announcements and risk alerts: legitimate platforms conduct some level of project screening and issue warnings about major risks (such as a chain asset confirmed as a scam).
   • Manage risks and set stop-loss orders: utilize platform tools for stop-loss and take-profit orders, plan exit strategies in advance, and avoid suffering unacceptable losses during extreme volatility.

The dramatic journey of HNUT from surge to zero reflects the high-risk nature of crypto speculation. It once again proves that betting on assets without intrinsic value is essentially a “fool’s game.” For investors, understanding risks, leveraging tools for independent research, and choosing secure trading venues are essential survival skills to navigate market cycles. The world of cryptocurrency is full of innovation and opportunities, but only by remaining rational and vigilant can one achieve steady progress.