At least 15 blockchain wallets suspected of insider trading have converted an initial investment of $14,600 into more than $20 million, raising concerns about transparency and fairness in the cryptocurrency market.
15 insider wallets generated more than $20 million in revenue from Focai.fun (FOCAI), a memecoin recently launched on Solana (SOL)’s memecoin launchpad Pump.fun.
The suspected insider earned more than 136,000 times his initial investment of $14,600, purchasing more than 60.5% of the total token supply, according to on-chain analytics firm Lookonchain. “They then sold all of the $Focai for 94,175 $SOL ($20.5M), making a profit of 94,108 $SOL ($20.48M).”
FOCAI internal wallet. Source: Lookonchain
The concentration of such a large amount of tokens in a small number of wallets has drawn criticism from blockchain analysts. This situation highlights the potential risks to cryptocurrency’s core principle of decentralization.
FOCAI/USD, historical chart, market capitalization. Source: Pump.fun
The market capitalization of the FOCAI token peaked at over $46 million at 4:45 AM UTC. The token’s market capitalization fell about 14% to $39.6 million as of 11:55 a.m. UTC, according to Pump.fun data.
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One wallet earned nearly $3.5 million in three hours.
Among the 15 wallets, the most profitable address, ‘9DtTb’, earned $3.47 million in 3 hours. Blockchain analytics platform Onchain Lens detailed the transaction.
“Insider bought 123.32 million $FOCAI in Pump.Fun at 5.39 SOL ($1,168). Insiders sold all of $FOCAI for 16,070 SOL worth $3.47M. Insiders profited by x2973.”
Focai insider wallet “9DtTb” selling pattern. Source: Onchain Lens
Despite their inherent lack of utility, memecoins can be a profitable investment for a small number of traders. Last December, one skilled cryptocurrency trader turned $27 into $52 million after making more than 1.9 million times his initial investment in Pepe (PEPE) tokens.
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Over 99% of Pump.fun traders are unprofitable.
However, most memecoin traders are still not profitable.
Over 99% of Pump.fun traders lost money or made profits of less than $1,000.
Out of a total of 9.8 million wallets, only 50 generated up to $1,000 worth of revenue, with 5 wallets generating between $1,000 and $10,000.
Distribution of monetized wallets on Pump.fun. Source: Dune
According to Dune data, only one wallet generated more than $10,000 in revenue.
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