PENGU trader flipped $10k to $3 on Pudgy Penguins tokens

One unfortunate dealer misplaced $10,000 shopping for Pudgy Penguins’ PENGU tokens shortly earlier than the NFT-tied airdrop.

Let it snowball, or so one unfortunate dealer thought as they tried to run the Pudgy Penguins crypto airdrop on December 17. Whereas the Pudgy Penguins (PENGU) token soared over $3 billion in market capitalization simply hours after its debut, an investor purchased the coin with a ridiculous capitalization of $14 trillion.

Their preliminary $10,000 funding become lower than $3 inside minutes, in line with information from the chain and group observers.

From $10,000 to $3, PENGU Dealer Sunk by Iceberg

The on-chain information confirmed that an unknown dealer had performed this placed a big PENGU order on Jupiter shortly earlier than the token went stay.

Such merchants, sometimes called ‘snipers’, use subtle buying and selling instruments to shortly scoop up newly launched tokens. Nonetheless, a glitch in Jupiter’s decentralized trade left this would-be PENGU sniper in a low liquidity pool.

DEX aggregators like Jupiter calculate crypto costs utilizing a system that autonomously adjusts value tags primarily based on demand, generally known as a bonding curve.

Tech-savvy dangerous actors generally manipulate this technique to create extremely unstable liquidity swimming pools. Since anybody can construct a liquidity place, merchants sometimes purchase tokens from incorrect contracts and undergo important losses.

On this case, the dealer probably bought one in all these manipulated liquidity swimming pools with out verifying the contract tackle or token market capitalization. After exchanging 45 wrapped Solana (SOL), the customer obtained solely 78 tokens value lower than $5 on the time of reporting. Unfazed by the error, the dealer finally acquired 62,585 PENGU cash value roughly $2,000.

Pudgy Penguins street map

The token launch topped Pudgy Penguins’ latest restoration in a broad, non-fungible token renaissance. Iglo Inc.’s NFT Assortment was among the many high three NFT initiatives by way of market capitalization. A single Pudgy NFT at one level price greater than a Bitcoin.

The Penguin-themed blockchain artworks traded for a mean of $60,000 after the airdrop, whereas a 50% correction adjusted the ground value to fifteen.63 Ether (ETH).

Wanting forward, Igloo Inc.’s roadmap contains activating PENGU capabilities on the Ethereum blockchain. The corporate additionally plans to launch its Layer-2 Summary Chain community. Pudgy Penguins’ PENGU token has a complete provide of 88.88 billion tokens, with seven million eligible addresses for the airdrop.