Cryptocurrency influencer loses 8 million in a month from a 15 million investment
In the last 24 hours, the cryptocurrency market experienced a significant downturn, with most digital currencies crashing. A prominent crypto influencer and supporter of Ethereum (ETH) is currently facing unrealized losses of $8 million with the ERC-20 token FRIEND.
Machi Big Brother, a pseudonymous influencer with 164,400 followers on X, has suffered over 50% in losses with FRIEND. Lookonchain reported this one-month losing position in a post on June 8.
Since May 3, Machi Big Brother (@machibigbrother) has been accumulating $FRIEND, spending 4,975 ETH ($15.6M) to purchase 8.6M $FRIEND at an average price of $1.81. At the current valuation, he is down $7.9M on his $FRIEND investment.
According to the on-chain analyst, Machi Big Brother has been actively buying the token since May 3, acquiring 8.6 million FRIEND at an average price of $1.81. The influencer invested 4,975 ETH, equivalent to $15.6 million, and is now facing a 55% decrease in value.
As of now, FRIEND is trading at $0.808, marking a 60% decline in the past month. This means Machi Big Brother’s position is now worth $6.95 million, down $8.65 million from a month ago.
Friend.tech (FRIEND) one-month price chart. Source: CoinMarketCap
The well-known cryptocurrency trader Ansem has categorized FRIEND as a meme coin and a “culture coin,” emphasizing its ecosystem. Ansem shared this on X on May 4, indicating he may have been building a position in the token around the same time as the other influencer.
Friend token is the first memecoin that is also a culture coin that is also a dex that also has real revenue that is also distributed entirely to the community that is also backed by paradigm. pic.twitter.com/bXDeSEaHGS — Ansem ️ (@blknoiz06) May 4, 2024
Interestingly, FRIEND reached its peak in social volume and price in early May but has not been able to match those levels since. Data from Santiment suggests that FRIEND saw a short-lived surge in hype and interest from crypto influencers about a month ago. However, this momentum has since faded, resulting in losses.
FRIEND price and social volume. Source: Santiment / Finbold (Vini Barbosa, using Sanbase Pro)
Meme coins like FRIEND carry substantial risks that traders should not overlook due to their speculative nature. These cryptocurrencies often lack intrinsic value and are primarily influenced by social media hype.
Crypto influencers and traders who invest in meme coins are essentially taking a gamble, hoping to sell at a higher price to others. This mentality aligns with the “Greater Fool Theory,” which suggests that profits can be made from overvalued assets. However, it also highlights the inherent risk, as the market may eventually run out of willing buyers.
When the hype subsides and demand diminishes, traders may find themselves holding worthless assets, leading to significant financial losses.
Disclaimer: The information provided on this platform should not be considered investment advice. Investing in cryptocurrencies carries risks, and capital is always at stake.
