A cryptocurrency trader has managed to make over $1.6 million in less than an hour by trading a little-known cryptocurrency shortly after it opened for trading, in yet another case in which traders believed to be developers behind projects take advantage of initial price surges.
According to on-chain analysis service Lookonchain, the trader spend just 0.24 BNB, around $138, to buy 375.4 billion $PUMP tokens wth over 6 BNB worth $3.48 million. The price of $PUMP later on surged, and the trader sold 360.4 billion tokens for 8,759 BNB worth $5.08 million.
In total the trader managed to realize a profit of $1.6 million in less than an hour, and still has 15 billion PUMP tokens in their wallet, worth over $200,000.
After $PUMP opened trading, a whale made 2,759 $BNB($1.6M) on $PUMP in less than 1 hour!
He spent a gas fee of 0.24 $BNB($138) and successfully bought 375.4B $PUMP with a cost of 6K $BNB($3.48M).
Then sold 360.4B $PUMP for 8,759 $BNB($5.08M), realizing a profit of 2,759… pic.twitter.com/8Ah6vGoqWx
— Lookonchain (@lookonchain) March 25, 2024
The trader comes at a time in which the memecoin scene has been surging, with several traders making extreme returns off of newly launched digital assets. In one case, a memecoin saw a dramatic price rise of over 3000% over a 24-hour period, and a cryptocurrency trader managed to take advantage by betting 50 $SOL, worth around $9,000, in the cryptocurrency. Its rise has seen them make a profit of over $123,000.
In another case, a cryptocurrency trader managed to make a profit of over $3 million trading a newly launched Solana-based memecoin within just 12 minutes after betting nearly $2 million on it right after it started trading.
In yet another incident, a trader, identified on-chain by the alias “sundayfunday.sol,”turn a $72,000 investment into a staggering $30 million within just three days trading a little-known cryptocurrency.
Various users on the microblogging platform X (formerly known as Twitter), have suggested that the traders making such high-risk investments in these newly launched cryptocurrencies are the developers behind them or marketers helping pump the cryptocurrency’s price up so they could later sell the tokens at a higher value, a form of market manipulation.
Nevertheless not every case goes as planned. In one trade, an investor managed to lose $46,000 in a matter of just three minutes after the price of the token they bet on started dropping.
The incident highlights several key factors native to the cryptocurrency space, which include the volatility inherent to it that’s especially present in lesser-known and meme-inspired cryptocurrencies, and the liquidity issues that these newly launched tokens can have, forcing traders to suffer significant losses to slippage.
Featured image via Pexels.
