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Cryptocurrency trader turns $12,300 into $1.72 million in 4 days
Another cryptocurrency trader caused a sensation in cryptocurrency market with impressive results in decentralized finance trading (DeFi) ecosystem. The trader made over $1.4 million in unrealized profits with the PEW meme coin on Ethereum (ET).
As developed, the address starting with “0x8EF73‘ bought 27.05 billion PEW with 3.2 ETH, worth $12,300. Lookonchain spotted and reported this cryptocurrency trader’s activity on May 31 in a post on X.
Notably, “0x8EF73” has already sold 8.05 billion PEW for 83.5 ETH, worth $315,000, or over $300,000 in realized profit. As of this writing, the monitored account holds 1 billion PEW worth $61,000.
PEW/WETH on Uniswap. Source: Lookonchain
However, Lookonchain explained that the same trader holds 18 billion more PEW, evenly distributed across 15 other addresses. These holdings date back to the first purchase, which occurred just three minutes after the meme coin began trading on Uniswap (UNI), the main decentralized Ethereum exchange (DES).
The cryptocurrency trader holds a $1.42 million stash of this new meme coin four days after purchasing.
The cryptocurrency trader may have liquidity issues in making the $1.4 million profit
Interestingly, the meme coin called “pepe in a memes world” (PEW) has only $7.5 million in total value locked (TVL) on Uniswap. This metric translates to the liquidity available to trade PEW with others CER-20 tokens on the platform.
Therefore, any attempt to realize larger quantities of this trader’s holdings could have a direct impact on the price of PEW, making it difficult to take profits.
Meme coins and the great fool theory
The risks associated with trading are highly volatile and speculative cryptocurrencies cannot be overstated.
Meme coins, like PEW, often lack fundamental value, while hype and buzz on social media drives their price action. Traders who buy these coins are essentially gambling in the hope that someone else will buy them at a higher price.
This mentality is in line with the “Big Fool Theory,” which suggests that profits can be made by buying overvalued assets and selling them to a “big fool.”
However, this theory also highlights the inherent risk of such investments, as the market ultimately runs out of willing buyers. When enthusiasm dies down and demand declines, traders can continue to hold worthless assets, which leads to huge profits financial losses.
Disclaimer: The content of this site should not be considered investment advice. Investing is speculative. When you invest, your capital is at risk.