Memecoins built on Binance Chain (BNB) tumbled on Thursday after Binance founder Changpeng 'CZ' Zhao cautioned that his social media activity should not be interpreted as investment advice.

Zhao made the remarks in response to a post from user YazanXBT, who warned traders that linking tokens to Zhao's tweets or sending assets to wallets associated with him carried no guarantee of safety.“My tweets are not endorsements,” Zhao said on X.“Now I just tweet normally - any overlap with memes is coincidental.”

The clarification sparked a sharp selloff in several BNB-based memecoins that had rallied earlier in the week on perceived associations with Zhao. Prices of tokens traded on PancakeSwap (CAKE) - the leading decentralized exchange on BNB Chain - dropped across the board. CAKE itself declined nearly 12% in the last 24 hours. However, retail sentiment around the cryptocurrency remained in 'extremely bullish' territory amid 'extremely high' levels of chatter over the past day.

At the peak of the frenzy on Tuesday, more than 100,000 on-chain traders had bought into newly launched BNB memecoins, according to data from Bubblemaps, with roughly 70% showing paper profits at the time. 

PALU, a meme token that gained traction after Zhao engaged with a post depicting a cartoon version of himself - identical to PALU's mascot - plunged more than 50% on Thursday. The token's surge earlier in the week had made it one of the fastest-growing assets in the BNB ecosystem. Retail sentiment around the cryptocurrency remained in 'neutral' territory over the day on Stocktwits.

Read also: Bitcoin, Ethereum, And Other Major Cryptocurrencies Dip Ahead Of Powell's Speech Amid Rising Dollar

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