Trader Buys $9M of Solana Meme Coin Dogwifhat, But Loses Over 60% to Slippage

An enthusiastic buyer – or an apparent fat-finger trader – seemingly spent nearly $9 million on Thursday to purchase dogwifhat (WIF), one of Solana's most-viral meme coins that netted millions of dollars for early investors in December.

The purchases were done over three transactions worth $6.25 million, $1.78 million and $893,000, blockchain data tied to Solana wallet address “5qYuZ9ZLShLB1MuV83xHRcTgVA9A5pUajnQUUcPbk3bf” show.

Someone actually did this an hour ago:

- Bought $8.8M worth of $WIF in 3 transactions
- It is currently worth $3.1M

Sitting at an Unrealized Loss of $5.7M

Why? pic.twitter.com/S8gZvYeHYO

— Gumshoe (@0xGumshoe) January 10, 2024

But placing such big a trade order on a relatively low-liquidity pool seems to have spelled financial disaster: The buyer ended up purchasing WIF at as high as $3 as prices spiked immediately, in line with how decentralized exchanges work, before prices plunged back down to 15 cents, close to the level before the buys, leaving the trader with a slippage loss of over $5.7 million.

Slippage refers to the difference between the expected price at which a trade is placed and the actual price at which the trade occurs.

Some market watchers have termed the trade a possible “marketing stunt,” one that could have drawn attention to WIF as prices took a hit in recent weeks.

WIF is up 50% in the past 24 hours on the buying pressure, data from DEXScreener shows. Traders exchanged $35 million on decentralized exchanges alone, and the token has a market capitalization of over $200 million.

The meme coin turned out to be one of the biggest hits in the Solana ecosystem recently, alongside bonk (BONK) and other tokens, as a meme coin frenzy occurred on the blockchain in December.

The significant hype it drew created a lottery of sorts for early buyers, as some turned $1,000 worth of SOL into millions of dollars as prices quickly and suddenly climbed.