JINQIAN rockets to $80M then zeroes out in two hours; “stock-crypto pairing” becomes a custom-made “pump and dump”

Original by Odaily Planet Daily (@OdailyChina)

Author | Golem (@web3_golem)

On the evening of September 2, Robinhood Chain staged quite a spectacle. The stock-paired Meme coin JINQIAN surged to an $80 million market cap within the first hour of trading, only to crash to $10 million in the next hour. As of press time, JINQIAN's market cap has dwindled to approximately $3 million. Whether it leads to financial freedom or wiping out one's principal seems to hinge on a single moment's decision.

Buying Stocks to Launch a Meme? A Custom-Made Rug Pull for the Crypto Crowd

To understand what exactly happened in those two hours, we need to start with a post from overseas KOL Rune.

On September 1, Rune posted that he had spent $1.8 million over-the-counter to acquire 37.4% of a NASDAQ-listed company. The company had a market cap of $4.8 million, a share price of $0.12, and a short interest ratio of 92.3%. His plan was to tokenize the company's stock and deploy it on Robinhood Chain, then launch a paired Meme coin. His reasoning: if the community trades the Meme coin, demand would also flow toward the stock token, which in turn would prompt the issuer to buy equivalent amounts of real US stocks to pump the price, creating a short squeeze in the equity market.

The mere idea of this sent countless Meme traders into a frenzy, as it perfectly catered to the crowd's fantasy of "retail investors crushing institutions," "crypto crushing Wall Street," and "the underdog rising to become the shining protagonist." The community eagerly awaited such a coin. A day later, JINQIAN was born.

JINQIAN is paired with stock token FAMI. Farmmi (FAMI) is a NASDAQ-listed company primarily selling mushrooms. As JINQIAN's market cap rose, the on-chain stock token FAMI's price climbed, and Farmmi (FAMI)'s share price surged to as high as $0.47 during US trading hours—a gain of over 300% within one hour.

Many thought JINQIAN would be the next GameStop, but it turned out to be a rug pull tailor-made for crypto retail investors.

Although the FAMI token shares the same ticker as NASDAQ-listed Farmmi, it is not an officially tokenized stock, nor is it listed in Robinhood's official contract registry. In other words, when JINQIAN trading drove up demand for FAMI, the issuer behind it may have never actually purchased Farmmi (FAMI) shares in the stock market. The short squeeze narrative Rune envisioned never materialized.

After JINQIAN's crash, Rune—who had been demanding community airdrops—quickly issued a clarification, claiming that his earlier post about acquiring a US-listed company was an "AI slop post" generated by Claude, and that the entire story was fabricated.

Right Outcome, Wrong Process

Rune's clarification was, of course, an act of self-preservation, as aggrieved investors were already preparing to contact the FBI to have him arrested. Setting aside judgment of Rune for now, the real question worth pondering is: if the trading demand for the FAMI stock token generated by JINQIAN never transmitted to the real stock market, then who exactly pumped Farmmi (FAMI)'s share price?

The answer is still crypto Meme traders. The "smart" crypto players wanted to stay one step ahead of market makers and Wall Street elites—buying Farmmi (FAMI) shares proactively before these institutions were "forced" to do so. Since Farmmi (FAMI) is already a small-cap stock, retail buying alone was sufficient to send it up more than threefold.

Chinese-speaking KOL 0xSun later analyzed in a post that, under normal circumstances, the logic of an on-chain stock short squeeze works as follows: retail investors who do not hold the stock token buy the Meme coin, driving up the price of the stock token that serves as the underlying asset in the liquidity pool; market makers then buy the underlying stock to capture arbitrage opportunities, converting and minting it into on-chain tokenized stock, which re-anchors the price; the market makers' stock purchases push up the share price, thereby creating a short squeeze.

However, the JINQIAN/FAMI case did not follow this pattern. The non-compliant project team issued the FAMI token on-chain while retaining minting authority, and the liquidity pool may not have been locked. In essence, FAMI was merely an on-chain token sharing the same name as Farmmi (FAMI). Because the underlying company's market cap was extremely low, on-chain sentiment was ignited—retail investors frantically bought JINQIAN, which in turn drove up FAMI as the base pool asset. Some retail traders took their reasoning a step further and directly bought Farmmi (FAMI) shares, which is what actually pushed the stock price higher.

Therefore, the rise in Farmmi (FAMI)'s share price is a textbook case of the right outcome achieved through the wrong process.

Is the Stock-Paired Meme Short Squeeze a False Premise?

Language can describe reality, but it can also shape it. Does the narrative of "Meme coins squeezing Wall Street" genuinely hold up, or is the Meme community simply looking for nails while holding a hammer?

Aside from outright scams like JINQIAN, other stock-paired Meme coins have recently ridden the "Meme coins squeeze Wall Street" narrative—the most notable being BONER, which currently holds a market cap of approximately $44 million. BONER is paired with the stock token HIMS. Hims (HIMS) is a company primarily selling erectile dysfunction medication. Chinese-speaking Meme KOL Wang Xiaoer has been actively shilling BONER, claiming its ultimate purpose is to make the reality of Memes driving stock prices upward come true and challenge Wall Street.

Using a Meme coin to prop up its paired stock token is, at its core, a roundabout and inefficient form of market manipulation. The so-called "flywheel effect" is merely market makers or project teams exploiting retail investors' speculative impulses to inject their capital into the underlying stock market to create short-term price discrepancies. However, this sentiment-driven buying lacks fundamental support and is extremely fragile in terms of demand. Even if the token at some point commands a significant premium over the underlying stock, arbitrage and mean-reversion mechanisms will quickly re-anchor it to the stock's price.

On Robinhood Chain, there is only one issuer of stock tokens: Robinhood itself. Only authorized participants (APs) can directly subscribe to or redeem stock tokens from Robinhood. Moreover, when an AP subscribes for stock tokens, the flow of subscription funds into the real stock market is not real-time—it is subject not only to US stock trading hours but also to procedural constraints such as compliance, settlement, and custody.

Therefore, the logic that Meme coin trading demand would stimulate market makers or issuers to buy stocks hits a fundamental reality: the on-chain Meme frenzy burns out within hours, while the capital transmission has yet to even begin.

Of course, whether the "Meme coins squeeze Wall Street" logic actually holds in reality may not matter much to Meme traders anyway—Wang Xiaoer is already sitting on over $800,000 in unrealized gains from BONER, having spent just $226 to get in.

The fastest way to unite the masses in this world is to establish a common enemy, even if it is merely an imaginary one. For retail investors, Wall Street and institutional players have always been that "enemy"—the prospect of making money off them or forcing them into action is always exhilarating.

But while you're paying for the "grand narrative," don't forget you're in the Meme trenches. There are no comrades here—only demons waiting to pour water on your fire.