Trader Loses $5.7 Million To Slippage in Memecoin Trade 54
Web3 is Going Great: A trader looking to buy $9 million of a recently popular Solana memecoin, dogwifhat (WIF), lost $5.7 million of their funds to slippage as they placed a massive order in a pool with relatively low liquidity. $5.7 million of their funds were lost to "slippage" -- the discrepancy in price that can occur when a trade is so large or a market is so illiquid that the trade itself impacts the asset price.
This just in (Score:5, Funny)
Stupid person loses money!
This is a developing story. Check back here for updates.
Re:This just in (Score:5, Funny)
The real story would be behind how someone so stupid got entrusted with $6 million dollars in the first place
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The real story would be behind how someone so stupid got entrusted with $6 million dollars in the first place
My guess is somebody's daddy.
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This guy probably made his money trading crypto and will probably make it back doing t
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That's simple. Crypto valuations are almost entirely bullshit and based on pump & dump manipulations. While the notional value of the crypto was $7m, the actual liquidity you could extract was only $20k at best. All crypto is a scam.
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Re: This just in (Score:2)
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Stupid person loses money!
This is a developing story. Check back here for updates.
Little known fact: shortly after cracking the code on hieroglyphics, Egyptologists were eager to see what sorts of secrets were buried in the tombs of the kings, but try as they might, the message you provided above accounted for nearly all hieroglyphs (the handful of remaining messages translated to “drink your ovaltine”). Experts have been checking back regularly for updates ever since, and have sought additional funding to keep doing so.
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I'm not pointing that out as a crypto-apologist - more in response to the stories over the weekend that the average net worth of 50-somethings in the US has now surpassed $1M. [usatoday.com]
So for all of us t
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the average net worth of 50-somethings in the US has now surpassed $1M. [usatoday.com]
Average net worth doesn't mean much.
Median net worth means far more, and it is much lower.
The average household net worth in Boca Chica, Texas is $10 billion.
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That has become the kneejerk response to every article stating a mean, and it's not true. The mean does matter. Your dollars are competing in a market of other peoples' dollars, whether that's a lot of people with a few dollars each, or a few people with many dollars each.
Look at cars, as we've seen the automakers stop production of lower margin cars since there's a better profit making fewer more expensive ones, and this in turn propagates downwards and runs up the
Limit price? (Score:3)
Re:Limit price? (Score:4, Interesting)
Most brokerages won't let you buy penny stocks without setting a limit price for this very reason.
Yeah, cryptocurrency purchases are entirely unregulated, and "brokerages" are amateurs. The whole point of the idea was to get rid of the "gatekeepers." Well... the gatekeepers are gond.
Hard to imagine someone so naive as to place a massive order like this without considering the impact of slippage.
I doubt that the buyer even heard of "slippage". Cryptocurrency trading is mostly done by amateurs who think they can get rich quick on stuff that the professionals stay clear of.
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most likely a fat finger error, or miscomputation which can be easy with weird 10^-7 based prices.
for money laundering there are better options.
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The stupid amateur had $9M to waste on this.
In the world of high-stakes trading that's peanuts.
Guy was an amateur who thought he could play with the big boys.
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I doubt that the buyer even heard of "slippage".
There's no way that a complicated thing I don't understand could possibly come back to hurt me!
Re:Limit price? (Score:5, Funny)
Hard to imagine someone so naive
I've got bad news for you, but you're going to want to sit down for this, in front of a mirror...
Re: Limit price? (Score:2)
Re: Limit price? (Score:1)
Well think about it this way: People like rsilvergun have it in their head that if Elon Musk, Jeff Bezos, and Bill Gates are worth 100 billion dollars each, then surely they must have it sitting in a bank account somewhere (or for rsilvergun, a big money bin that they can swim in like Scrooge McDuck) that they can simply withdraw money from.
It really doesn't work that way. They didn't become billionaires by saving their wages. They got that way because they founded big companies that heavily appreciated in
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... the idea of taxing based on net worth (aka wealth tax.)
Not so bad :P I mean, if they tax positive net worth, then they conversely need to give money to everyone with negative net worth (debt), no?
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Oh if only.
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"You've just described literally every person who believes in the idea of taxing based on net worth (aka wealth tax.) "
aka property tax.
I assure you it's real.
Now you'd be right of course, that property tax is not the same thing as wealth tax... except for the middle class, where it pretty is much is exactly the same thing, as the large majority of their net worth is their home. So they are (effectively) paying a tax on the majority of their net worth.
And renters aren't doing any better, part of the rent th
Likely-more-accurate version: (Score:5, Insightful)
"Would-be money launderer loses $5.7 million worth of gift cards to slippage"
Woops (Score:4, Insightful)
Most swap contracts let you specify maximum slippage. Uniswap certainly does.
Also that's what you get for trying to buy some idiotic memecoin that isn't even on a CEX.
Stop with the crap posts already (Score:5, Insightful)
Random silly person no one has heard of loses money on random coin that no one has heard of. Seriously this is news that matters how?
C'mon /. you can do better... we need CmdrTaco (I know the ship sailed ages ago...)
Re:Stop with the crap posts already (Score:4, Interesting)
It's not losing money on the coin. It's the slippage.
https://help.coinbase.com/en/c... [coinbase.com]
Slippage is pretty easy to avoid on a CEX, such as Coinbase (linked above). Set a buy order at a fixed price and wait for people to fulfill that buy instead of attempting a market buy. Even if you DO execute a market buy, the CEX is usually nice enough to prevent frontrunners from seeing your trade request and shifting open sell orders around to screw you.
When using a swap contract, frontrunners can and will wreck you. Which is why you have to set a slippage limit to prevent that. Sadly the aforementioned idiot with $9 million seemed to have either a). not understood what slippage limits can do to prevent problems such as this or b). engaged with a smart contract that doesn't allow slippage limits.
Anyway, the point of the story is: slippage. On DeFi swap contracts, people get burned this way a lot. So much so that frontrunner bots plague swap contract.
aka "Idiot loses money on unregulated security" (Score:2)
This guy was over greedy, and he overestimated the amount of money that he could make. So he went all in because he was an idiot. Then the market was not big enough so he lost most of it.
Big fish tried to be the biggest fish in the pool and the pool was too small to let him breath. What an idiot.
I would absolutely love to know how he got trusted with the money, because I could double that money, in a much safer way, with a clear audit trail while not violating regulations or doing risky junk.
This does not add up (Score:4, Interesting)
You'd smash all buy walls and then the resulting price hike on manual trades from people getting alerts would crash the price but not nearly to that volume. The guy's either an idiot or this is a "long game" headline bait scam. I've been in crypto since 2010 and even I'm not sure which but this is another meme-based Solana chain shitcoin so nobody with a functioning brain would dump this kind of money into it without a reason. I'm definitely leaning towards scam.
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or you can't accept the fact that blockchain is absolutely the worst distributed database solution devised by the mind of man and even makes bitcoin illiquid at times.
but then they're all a shitcoin, a gambling token that nobody with a function brain would dump money into
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A "marketing stunt"? Yeah nothing says marketing more than "Hey everyone, look how much of a joke we are, you can't even conduct a transaction without losing money!"
Anyone who said there's no such thing as bad publicity needs to go get their money back from whomever lobotomised them.
People lose money on Dunning-Krugerrand (Score:2)
Film at 11.
Or on Netflix, it wouldn't be the first hyped up crap nobody really gives a fuck about that they make a whole series out of.
People with money (Score:1)
Why is it that stupid people have so much money? What the actual fuck.
Does being stupid make you rich? Ignorance is wealth?
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The single greatest indicator that you will be wealthy, the greatest common attribute of wealthy people, is that their parents were wealthy, not intelligent. Money makes money, money creates connections that help you make more money.
Source? (Score:5, Interesting)
Market vs Limit (Score:2)
What stupid fuck doesn't understand the difference between a market and a limit order, and what stupid fuck places a huge buy order in an illiquid market using the former?
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1). People using swap contracts and
2). Lots of people who don't understand the risk of frontrunner bots.
Rare defense of bitcoin (Score:2)
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Did the guy lose (Score:3)
Fake "news" (Score:2)
This is just an attempt to hype up the particular cryptocurrency.
If you look up the link and follow it through you'll note that it's only the crypto-journals and social media repeating the same story.
If you look it up on news search sites (groundnews, google news, etc.) you'll find no "real news" source even mentioning it.
You will however find a lot of "trader turned $1xx K into $2-5M in a week buying (same crypto).
Not really slashdot material any more than yesterday when I dropped a quarter down the drain.
All the rest (Score:2)
Crapcoins are crap! Who would have thought? (Score:2)
Apparently not this nil wit.
Good (Score:2)
As Expected (Score:2)
But at least he now has the dogwifhat currency he needed to purchase from stores that only accept WIF, so what's the big issue?
Elaine! (Score:2)
"Do women know about slippage?"