The Ben.eth Pattern: How One Anonymous NFT Collector Built A Million-Dollar Meme Coin Fraud Machine

Ben.eth, a pseudonymous NFT collector turned meme coin operator, is preparing to launch $LOYAL—his third controversial token offering—following a lucrative scheme that extracted millions from retail investors through $BEN and $PSYOP.

The Rise Of Ben.eth In The 2024 Meme Coin Frenzy

Since entering the NFT space in 2021, ben.eth remained relatively obscure until May 2024, when the meme coin boom presented an opportunity. His initial token, $BEN, flopped until a prominent crypto content creator publicly purchased it, triggering hype-driven buying pressure. This marketing-driven pump set the stage for what investigators would later describe as a deliberate fraud pattern.

The timeline reveals the scheme’s sophistication: within weeks, ben.eth accumulated over $9 million in ETH through token presales. His wallet balance skyrocketed from $2,600 on May 3 to $9.28 million by May 23. Though the balance subsequently declined to approximately $6.3 million (3,450 ETH), the architect had already extracted his profits.

The Rug Pull Sequence: $BEN And $PSYOP

The modus operandi followed a predictable pattern: launch with celebrity endorsement, inflate via artificial hype, then exit with investor funds. When the prominent crypto creator dumped all $BEN holdings on May 17, ben.eth pivoted immediately to $PSYOP, launching a presale that generated close to $9 million in fresh capital from unsuspecting participants.

On-chain detective ZachXBT documented how ben.eth extracted approximately 10,000 ETH specifically from the $PSYOP presale phase. The pattern suggested calculated timing: each phase was designed to lure different cohorts of retail traders, each believing they were early to the next viral opportunity.

$LOYAL: The Third Installation

Ben.eth announced on May 27 that $LOYAL would launch, requesting ETH transfers while explicitly promising no supply cap—a detail investors recognized as a red flag given his history. The crypto community largely interpreted this as a premeditated third rug pull rather than a legitimate venture.

Legal Reckoning And Investigative Exposure

The consequences mounted quickly. Legal partners filed class action lawsuits alleging wire fraud and investor deception. ZachXBT’s public exposure detailed the scheme’s mechanics, while evidence emerged of ben.eth amplifying fake endorsements, including compromised social accounts allegedly belonging to Steve Aoki and Jared Vennett.

Mike Kanovitz, partner at legal firm Loevy & Loevy, initiated formal action against ben.eth, demanding restitution to $PSYOP presale victims. The case exemplifies how anonymous identities in crypto enable sophisticated fraud that might face faster prosecution in traditional finance.

What This Reveals About Meme Coin Risk

Ben.eth’s operation demonstrates how influencer marketing, pseudonymity, and herd mentality combine to enable large-scale theft. The rotating-victim model—each new token targeting fresh cohorts—proves effective until on-chain forensics and legal action catch up. For retail traders, the lesson is stark: meme coins tied to anonymous operators, however well-marketed, carry catastrophic downside risk.