With renewed optimism in the cryptocurrency market, traders are driven by fear of missing out (FOMO). In this context, some have jumped back into meme coin speculation. One story in particular stands out for its cautionary nature. A crypto trader lost nearly $900,000 worth of SOL in the crypto game.
Meme coin trader gets FOMO and the money goes flying!
On-chain analytics platform Lookonchain reported the millionaire’s four-hour losses. It also called on investors to “please do not buy meme coins with FOMO.” This particular token was Restore The Republic (RTR), which has a political bias in anticipation of the US presidential election. The anonymous trader purchased 7.2 million RTR worth $916,400 with 5,800 SOL. This purchase was made at the meme coin’s all-time high. Therefore, this points to a backfiring fear of missing out.
Four hours later, RTR crashed. This forced the meme coin trader to exit his position. Thus, the trader surrendered for 113.3 SOL worth $18,000. According to Lookonchain, with this, $898,500 of this speculator’s wealth disappeared. In other words, this money was dispersed throughout the ecosystem after an emotional game.
Watch out for political and celebrity meme tokens!
Cryptocoin.comAs you have been following, the rise and popularity of meme coin projects marked the crypto bull rallies of 2023 and 2024. Thus, they attracted the attention and money of investors. These cryptocurrencies do not have a clear value proposition. However, they simply represent an idea or an internet meme. Political and celebrity-themed tokens in particular have achieved the greatest success among speculators. Thus, they have moved billions of dollars on decentralized exchanges (DEX). From Donald Trump to tokens related to Iggy Azalea and Andrew Tate, crypto investors have gained or lost capital by following FOMO from one speculation to another.
Experts often associate meme coins with the “Bigger Fool Theory,” which studies the rise and fall of financial bubbles. According to the theory, people who buy overvalued assets can profit from the “bigger fools” who buy after them. But at some point, new buyers will decrease. This will lead to aggressive crashes like we saw with the meme coin RTR. Therefore, crypto traders and investors should avoid being the bigger fool by investing in buzz-driven assets and instead opt for solid fundamentals.
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