Some time ago, a meme coin craze started on the Solana chain. The "fundraising opening" trend initiated by BOME almost swept the entire market. Suddenly, a lot of money poured in, and many people wanted to seize the opportunity and become Be the next lucky person to get rich off meme coins.
However, many investors forget that opportunities also come with risks. While seeing various news about getting rich on social networking sites, they ignore a stable and prudent investment mentality and only think about "fighting hard"with all their funds. It is this unconscious FOMO mentality that causes people who follow the meme craze to face huge losses.
Recently, Lookonchain released a report that monitored a wallet buying meme coins everywhere due to FOMO in just 3 days, and ultimately lost more than $1 million.
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Lost $1 million in 3 days
According to on-chain data, the trader first purchased the meme currency SLERF at a price of 4,958 SOL, which was worth about US$1 million at the time. When he entered the market, the price of SLERF was hovering between US$0.8 and US$1.4, but it was only A few hours later, the token price plummeted to the range of 0.4-0.6 US dollars. The trader chose to stop loss here and sold all SLERF tokens. It was initially estimated that the loss was 2,793 SOL, about 564,000 US dollars, which was almost halved.
Shortly after, the trader bought again for 19,133 SOL, equivalent to a value of approximately $3.52 million, when the SLERF token rebounded to $1.17, and finally bought 6,039 SOL one day later when the SLERF token plummeted to $0.7648. Valued at approximately $1.15 million, all of SLERF was sold again at a loss.
This is an obvious case of FOMO. When the price is low, you are afraid of falling and you dare not buy. When the price is high, you are afraid of missing out and enter the market. In the end, you become a pick-up.
In addition, there was a second trader who spent 5,004 SOL at the highest point of $1.32 to buy 790,236 SLERF, and ended up with a miserable end. After his purchase, the price of SLERF began to plummet, and he spent another 2,500 SOL to buy 790,236 SLERF at 0.8 Buy SLERF at a price of 650,330 USD.
Unfortunately, the price of SLERF did not rebound after he bought it twice. In the end, he sold all SLERF around $0.6 and only recovered 3,774 SOL, a loss of more than 3,731 SOL, equivalent to about $775,000.
Meme coins are risky, beware of the “survivor theory”
Although during this wave of Solana meme craze, some people did make money by trading meme coins, but the "survivor theory" still exists, which means that most people will only let you see the money-making side, but will not say that they have lost money. How much, over time, it is easy to start following the trend in the community, but ignore the possible risk of loss behind it.
In addition to losing money simply by trading, according to incomplete statistics, since BOME became popular, there have been hundreds of projects using a pre-sale model similar to "transfer coins to a certain wallet", and nearly 90% of them have been directly involved in the project. The models ran away, and the remaining 8% plummeted and exceeded the pre-sale price after the opening. Only about 2% are still surviving on the market, which is evident in the survivor theory.
For this reason, you must keep a few points in mind. First of all, most of the wealth creation effects of meme coins are "difficult to replicate". Secondly, the bull market community has a lot of information. It is recommended to streamline the tracking list and eliminate unnecessary information. Finally, do a good job in research and stick to the mentality of "investing within your ability." Only by avoiding excessive FOMO can you go further in the market.
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