A meme coin touting Pinkfong’s name collapsed on Thursday after the entertainment company behind YouTube hit Baby Shark said that it was unaffiliated with the token.
The meme coin, which was created using Story Protocol’s network for managing intellectual property rights and creating derivative works, was issued “without authorization,” Pinkfong said in a post on X, promising “grave legal consequences” for those violating the law.
Although Story Protocol is designed to remove rent-seeking intermediaries from the IP industry, it appears that a purported misunderstanding between two of its users has potentially created more work for lawyers than projects that secured the rights to Pinkfong’s IP traditionally.
Pinkfong is more than just a pink fox: The South Korean firm, which has generated more than 140 billion cumulative views across its YouTube channels, is responsible for the most popular video on YouTube, featuring iconic lyrics like “Baby shark, doo doo doo doo doo doo.”
In a now-deleted post on X, Story Protocol said that users could “remix and expand” the IP behind Pinkfong’s furry mascot following its tokenization, according to screenshots shared by pseudonymous blockchain sleuth ZachXBT on Thursday.
“Fascinated to see how this collaboration unfolds,” Story Protocol co-founder and CEO S.Y. Lee said in a now-deleted post.
Decrypt has reached out to Story Protocol for comment.
The meme coin debuted on Story Protocol’s network had a market capitalization of $6.32 million on Friday, according to DEX Screener. A few hours after its kickoff on Tuesday, the token rocketed to a market capitalization of $519 million.
Bubblemaps, a popular on-chain visualization tool and crypto sleuthing firm, said on X that it found insider activity around the meme coin. It found no evidence that the activity was linked to Story Protocol, but around 7% of the token’s supply was scooped up immediately.
The price of Story’s native token, which serves as the platform’s underlying medium of exchange, has been volatile, meanwhile. Since Tuesday, Story’s price has fallen from $12.91 to $7.24, while settling around $9.35, according to crypto data provider CoinGecko.
Pinkfong has endorsed two meme coins that exist on Solana and BNB Chain. As mentioned before, the unofficial one exists on Story’s network. It debuted through a platform called IP World, which says that it is “built for degens, by degens.”
The project said that it had been working with a licensed partner of Pinkfong’s, but it learned that the company’s license wasn’t valid, based on agreement that it had with another licensee. Nobody was prevented from engaging with the IP until that was verified.
IP World said that the incident, while frustrating, showcased some of its safeguards. Because the IP wasn’t verified on IP World, “creator fees remain locked on the protocol and cannot be claimed until the rightful IP owner is confirmed.”
The collapse of the unofficial Pinkfong meme coin has provoked scrutiny toward Story Protocol among some industry onlookers, but IP World made it clear on Thursday that the network underpinning its service had little to do with the actual problem.
“Story Protocol, the blockchain on which IP World operates, was never a party to this agreement nor was it in any way involved in these licensing matters,” the project said in a post on X on Thursday. “We are deeply sorry for the uncertainty and confusion this has caused.”
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