A trader situated in Solana has made significant profits from trading different tokens with meme themes on the Solana blockchain, according to a report published on April 26 by blockchain analysis company Lookonchain. The trader, recognized by their Solana Name Service account "paulo.sol," profited cumulatively from savvy investments in multiple memecoins, including as Dogwifhat (WIF), Jeo Boden (BODEN), and Bonk (BONK).
The trader started using BONK on November 11, 2023, after realizing the token's potential and building up a holding. Using a swing trading approach, the trader was able to profit over $6.28 million from BONK alone by purchasing at low points and selling at highs.
The trader showed a keen sense of timing not only with BONK but also with investments in WIF and BODEN. The trader held off on taking large holdings in these tokens until the first indications of increasing momentum. This was in contrast to investing in them right away when they were originally listed. The trader made $9.51 million in gains from WIF deals on December 4, 2023, and $7.04 million from BODEN trades on March 6.
The trader still has sizeable holdings in these memecoins as of this writing, with $7.6 million in BODEN tokens and $5.7 million in WIF. In addition, the trader has added other emerging memecoins to their portfolio, like POPCAT and PUPS. The trader has made investments totaling about $6 million in POPCAT and $1.77 million in PUPS, solidifying their position as the largest PUPS holder on the Solana blockchain.
The trading community has shown praise for the trader's outstanding performance; one X user attributes their achievement to their strong conviction rather than chance. "Diamond hands" is a term used by one user to characterize the trader; it refers to investors who hold onto their positions despite pressure from the market.
How long this trend will last and whether more traders will achieve a profit comparable to this one is a mystery given how popular memecoins are becoming. Memecoins' volatility and speculative nature can cause significant losses for investors who mistime their trades or fall prey to market manipulations, so it's important to approach these investments cautiously.
On April 24, Michael Dempsey of Compound started a discussion on the social media site X about memecoins' negative effects on the cryptocurrency investing community. The lack of technological depth of memecoins and how they undermine the industry's long-term ambition were highlighted by a16z's CTO, Eddy Lazzarin. He criticized them for catering to a specialized, casino-style user base and said they impede the growth of larger blockchain networks. Lazzarin drew attention to the differences between memecoins and initiatives that purport to have invented cutting-edge technology, pointing out that memecoins just provide volatility and entertainment. He argued against the industry's defense of memecoins in the face of larger issues and in favor of concentrating on rectifying dishonest behavior in tech-focused cryptocurrency projects.
April 2024, Cryptoniteuae