In a striking turn of events, a shrewd investor cashed out trillions of Shiba Inu (SHIB) and Floki Inu (FLOKI) tokens, raking in roughly $70 million amidst a downturn in their prices. This move, involving the exchange of 1.5 trillion tokens, has captured the attention of the cryptocurrency community.
Massive Earnings from Memecoin Sales
The transaction details revealed by Spot On Chain, an on-chain data provider, showed that the investor sold 1.24 trillion SHIB for a whopping $23.5 million on Binance and GateIO. They also unloaded FLOKI holdings to the tune of $44.3 million. These successful trades underscore the lucrative possibilities inherent in dealing with memecoins.
Highlighting the trend, notable figures like Rune Christen, the founder of MakerDAO, have also capitalized on the booming interest in these tokens. Christen offloaded substantial SHIB assets last week, reflecting the active participation of experienced investors in the memecoin market.
Impact of Increased Exchange Supply on Memecoin Value
The increased supply of SHIB and FLOKI on exchanges has been attributed to both known and undisclosed large transfers. This influx is exerting downward pressure on the coins’ value. The situation is particularly problematic for Shiba Inu’s token burning strategy, which aims to decrease its available supply, as the growing exchange stockpile dampens the effects of this initiative.
Subsequently, SHIB has suffered a significant 16.96% price drop over the past week, with FLOKI not far behind at a decrease of 6.61%. Despite impressive monthly gains that saw SHIB and FLOKI rise by 200% and 600% respectively, the current trend has presented challenges for investors.
The unpredictable and speculative behavior of memecoins such as SHIB and FLOKI serves as a stark reminder of the potential risks in cryptocurrency trading. With investors attempting to read market sentiments and adjust to rapid price changes, prudence remains a critical component in cryptocurrency investment strategies.