Trader Secures $480K Profit With 1,500x Gain Before BNB Memecoin Plunges 50%
An anonymous trader earned nearly half a million dollars in profit from the newly launched Bubb (BUBB) memecoin, achieving a staggering 1,586-fold return on investment shortly before the token’s value crashed by over 50%.
Rapid Profit and Sudden Crash
The trader initially invested just $304, purchasing 43.94 million BUBB tokens. Within 24 hours, the trader sold 28.9 million tokens for $122,000, retaining 15.64 million tokens valued at approximately $360,000. This resulted in a total profit of around $482,000.
Shortly after this profitable trade, BUBB’s market capitalization plummeted from a peak of $43.7 million to $22.6 million, according to data from Dexscreener.
Insider Trading Allegations Surface
The timing of the trade has sparked allegations of insider trading among market participants. The token initially gained significant attention after Binance co-founder Yi He commented on a BUBB-related social media post, fueling speculation of a potential Binance listing.
Crypto analytics platform Lookonchain highlighted the trade, prompting community members to question the fairness and transparency of the token’s launch.
Recent Memecoin Controversies
This incident follows a series of controversial memecoin collapses, including:
- The Wolf (WOLF) memecoin, inspired by Jordan Belfort, crashed 99% after reaching a $42 million market cap. Investigations revealed that 82% of the token supply was controlled by a single entity.
- The Libra token scandal, where insiders cashed out $107 million, wiping out $4 billion in market capitalization and causing significant political fallout in Argentina.
Calls for Stronger Investor Protection
In response to these incidents, industry experts are advocating for stronger investor protection measures, especially for politically-backed or high-profile memecoins. Recommendations include:
- Liquidity locking mechanisms to prevent rapid sell-offs.
- Restrictions on token launches to limit bot and whale participation.
- Ensuring fair token distribution to prevent insider advantages.
According to a report by DWF Labs, the Libra token collapse alone resulted in nearly 75,000 traders losing a combined $286 million.
Andrei Grachev, managing partner at DWF Labs, emphasized the importance of fair launches:
“Projects must strive to deliver as fair a launch as possible so that all participants have an equal opportunity to secure an allocation and aren’t disadvantaged by a handful of well-funded or well-informed players claiming the lion’s share of the supply.”
Summary
- An unknown trader made $482,000 profit from BUBB memecoin before its value dropped by 50%.
- The trade sparked insider trading allegations due to suspicious timing.
- Recent memecoin collapses highlight the need for stronger investor protections and fairer token launches.
