Ross Ulbricht, the infamous creator of Silk Road, has recently endured a staggering loss of $12 million in a matter of seconds due to a liquidity mishap on the Raydium platform. This incident has stunned the cryptocurrency community, highlighting the inherent risks involved in digital trading.
What Led to Ulbricht’s $12 Million Setback?
Ulbricht, who was convicted in 2015 for drug trafficking and money laundering, received a pardon from Donald Trump 11 years later. Throughout this time, he garnered steady backing from the crypto community, which even launched the ROSS token and allocated 50% of its supply to him. This support ultimately contributed to his recent financial downturn.
How Did the ROSS Token Price Crash?
Arkham Intelligence reported that during an attempt to liquidate tokens on January 29, a critical mistake was made. Instead of creating a Concentrated Liquidity Market Maker pool, Ulbricht or the wallet operator mistakenly set up a Constant Product Market Maker pool, causing ROSS tokens to trade at significantly lower prices.
This error directly led to Ulbricht’s $12 million loss and drastically affected the token’s market value.
This unfortunate incident presented a prime opportunity for a Maximum Extractable Value (MEV) bot, which turned Ulbricht’s loss into a $643,000 profit by acquiring tokens at a mispriced value and reselling them swiftly.
- Ulbricht lost approximately 40% of his ROSS token supply.
- The ROSS token’s price has dropped significantly, currently trading at $0.0005209.
- Trading volume surged to $508.27 thousand, indicating ongoing interest despite the price drop.
Ulbricht’s situation serves as a stark reminder of the volatile nature of cryptocurrency markets. It underscores the necessity for traders to maintain technical proficiency and make informed decisions to mitigate potential losses in this complex environment.
Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that cryptocurrencies carry high volatility and therefore risk, and should conduct their own research.
Source: https://en.bitcoinhaber.net/ross-ulbricht-faces-massive-loss-in-crypto-trade