The Solana (SOL) network currently faces congestion issues and transaction failures, bringing uncertainties to its trading ecosystem. Nevertheless, a trader has still managed to make from $530,000 to over $6 million in a month.
This Solana trader bought 12.08 million of boden, a meme coin playing with U.S. President Joe Biden’s image. Notably, the purchase happened two days after its launch for a cost of 3,100 SOL, worth $530,000. Lookonchain reported this case on April 9, in a post on X (formerly Twitter).
Then, the anonymous trader started selling the meme coin on April 6, one month after the purchases. In particular, 9.08 million boden were sold for 23,758 SOL, worth $4.06 million. As a result, the trader realized a profit of 20,659 SOL, worth $3.53 million.
boden/SOL hourly chart on Raydium. Source: Lookonchain
Uncertainties for traders in the Solana network
Trading meme coins is a naturally risky endeavor, due to liquidity concerns and the lack of a long-term sustainable demand. Speculators have no guarantee that they will manage to realize the acquired profit, even if they are lucky enough for the token’s price to surge.
However, Solana’s current network state brings more uncertainties and risks, considering over 50% of transactions fail to confirm. Thus, even if the price goes up and there is enough liquidity for profit realization, traders may never see the selling order going through facing transaction failures.
The cryptocurrency analyst Duo Nine posted a thread on April 9 explaining the war that is going on in Solana. On that note, traders are using bots to spam each other, which is causing the observed network congestion.
? There is a hidden war on Solana between big players. Users have no clue, but the consequence of that are endless failed transactions!There is only so much space available and the ones with the bigger guns win. Here's what they don't tell you. A thread (1/10). ? pic.twitter.com/ioDQ81cM9C
— Duo Nine ⚡ YCC (@DU09BTC) April 9, 2024A dashboard on Dune Analytics by scarn_eth shows over 57% of transaction failures on the same date. Yet, this metric surpassed the 75% mark a few days ago.
Solana failed non-voted transaction rate. Source: Dune Analytics (@scarn_eth)
For that reason, Solana speculators and users should avoid exposure to the ecosystem, despite some traders still profiting amid uncertainties. Finbold recently reported about 10 Solana competitors to consider until these issues are solved.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
