- A trading bot made 27,000 SOL in profits.
- The bull market is boosting memecoins.
- Pump.fun accumulated millions in earnings.
The crypto bull market has caused a surge in memecoin activity. This is especially true on Pump.fun, the biggest memecoin platform on Solana.
Sponsored
Traders seek ways to leverage technology, including trading bots, to earn on memecoins. Recently, one trading bot made 27,000 SOL, worth $6.8 million in profits, flipping memecoins on Pump.fun.
Trading Bot Makes Massive Gains
Traders are increasingly using bots to automate their strategies. On Monday, November 25, Lookonchain reported that one bot made substantial profits on Pump.fun. Over the past month, the bot made 27,000 SOL, or $6.8 million.
For instance, on November 23, the bot invested two SOL to buy 57 million FATHA tokens. Soon after, the bot sold these tokens for 4,456 SOL, a 2,227x return. Two days later, the bot bought 58.57 million FRIC tokens for 1.75 SOL. It then sold these tokens for 1,646 SOL, a 943x return.
What Strategy Did the Bot Use?
The Botโs trading patterns suggest a โspray and prayโ strategy. This means that the bot invested small individual amounts into many projects, expecting that these tokens would return outsized returns.
The strategy relies on selecting small-cap tokens that have significant upside. These tokens are selected for their potential. While the exact selection criteria is unknown, it likely relies on some user engagement metrics.
It also relies on a large failure rate for individual investments. Traders who use this strategy know that most of their investments will fail. They also know not to sell a winning token as soon as it goes up, as these tokens have to compensate for all the failed investments.
On the Flipside
- All trading strategies are typically more successful in a bull market. Traders who want to replicate this strategy should know it may not work in less favorable conditions.
- Venture capitalists use a similar strategy when investing in startups. They expect that most of their startups will fail. However, those who succeed can more than compensate for these losses.
Why This Matters
Understanding bot trading strategies can help traders perform better. It is especially important to understand the risks of trading.
Read more about Pump.funโs recent performance:ย
Pump.fun Hits $100M in Record Time Amid Mounting Criticism
Read more about Pump.fun criticism:ย
Solana Pump.fun Under Fire Over Dangerous Influencer Stunts
