According to data from Lookonchain, a trader lost $6 million when Binance postponed listing his PUMP token, leading to the dramatic price plummet. A trader, “PUMP Top Fund 2,” wagered 2 billion PUMP tokens worth an estimated $12.79 million. The planned listing did not happen, and unprecedented financial loss was incurred.
Impact of the PUMP Listing Delay
The PUMP token price dropped as low as 60% in 24 hours of anticipated listing on Binance. Early excitement for the token triggered huge oversubscription during the Token Generation Event (TGE). Non-listing of the token subsequently eroded investor confidence, as analysts have stated that Binance listings no longer guarantee price appreciations.
Investor’s Lost Opportunity with PUMP
On the redemption of PUMP tokens, the investor could not get the money back for eight days due to the reason that Binance lacked a spot trading market. At the time of redemption of the tokens, the price had fallen from $0.0064 to $0.0035. The fall led to an estimated loss of $5.86 million in unrealized gains, as stated by Lookonchain.
Market Volatility and Risks of PUMP
This incident reflects the inherent volatility of the cryptocurrency market. The altcoin market capitalization lost about $1 trillion within a single day, and it influenced prominent cryptocurrencies like ETH and XRP. Experts are closely monitoring the situation for signs of recovery in spite of deep pullbacks.
With Binance listings losing their former sheen as price movers, investors need to carry out extensive research prior to investing in such trades. This is a case of a wake-up call regarding the speculative nature of investments in crypto.
