Trader’s $138,000 Loss: A Cautionary Tale of Rapid Depletion in 35 Minutes with a Solana-Based Altcoin
In a dramatic turn of events in the volatile world of cryptocurrency trading, an investor experienced a significant loss, shedding $138,000 in just 35 minutes. This incident occurred during the trading debut of a little-known Solana-based altcoin, $PUNDU, highlighting the high-risk nature of investing in newly launched digital assets.
The unfortunate trade took place after the investor withdrew 1,535 SOL from the leading cryptocurrency exchange Binance, aiming to capitalize on the initial trading moments of $PUNDU. The strategy, known as “sniping,” involves attempting to purchase a new cryptocurrency at its lowest price point immediately upon listing. This approach requires sophisticated tools and automation to outpace other buyers in a race for initial liquidity. However, it is fraught with risks, including market manipulation by other participants.
If you don’t know how to snipe a coin, buying immediately after it opens trading is very dangerous!
This guy lost 721 $SOL($138K) in just 35 mins!
He withdrew 1,535 $SOL from #Binance before $PUNDU opened trading.
But until 2 minutes after the trading opened, he bought $PUNDU… pic.twitter.com/vx1Lsmx42d
— Lookonchain (@lookonchain) March 26, 2024
This is not an isolated incident in the cryptocurrency trading sphere. The allure of significant returns from investing in promising new cryptocurrencies has led various traders to success, but it has also paved the way for substantial losses. For instance, another trader previously managed a loss of $46,000 in just three minutes following a sharp price drop of the token Milady Wif Hat ($LADYF).
One of the most critical mistakes is not conducting thorough research before investing in a cryptocurrency. Traders often make decisions based on hype or the fear of missing out (FOMO) without understanding the fundamentals of the asset.
Trading too frequently or with too much capital can deplete resources and increase the risk of significant losses. Overtrading often results from impatience or the desire to capitalize on every market movement, even insignificant ones.
Prioritizing short-term gains over a well-defined, long-term strategy can lead to significant losses. This mistake occurs when traders invest in projects without conducting thorough research or understanding the project’s fundamentals, hoping to make quick profits.
Despite these setbacks, the memecoin scene on the Solana network has seen a surge, with several traders achieving extreme returns from newly launched digital assets. In one remarkable case, a memecoin’s price soared over 3000% in a 24-hour period, allowing a trader to turn a 50 $SOL investment, approximately $9,000, into a profit of over $123,000.
Moreover, another trader made headlines by earning a profit of over $3 million trading a newly launched Solana-based memecoin within just 12 minutes, having bet nearly $2 million on it right after it started trading. Similarly, a trader identified on-chain as “sundayfunday.sol” transformed a $72,000 investment into an astonishing $30 million within just three days by trading a little-known cryptocurrency.
These incidents underscore the unpredictable and often perilous nature of cryptocurrency trading, especially when it involves newly listed or lesser-known digital assets. While the potential for significant gains exists, the risks are equally substantial, as demonstrated by the rapid loss of $138,000 by an investor in the $PUNDU trading debut. As the cryptocurrency market continues to evolve, traders are reminded of the importance of caution and due diligence in their investment decisions.
Angel Marinov is the Managing Editor at Coinlabz. With extensive knowledge of crypto payments and blockchain use cases, Angel is a trusted source of accurate and timely information
