Cryptocurrency investors are paying sky-high prices to get their hands on newly released memecoins early and amass the vast majority of the supply. The latest example is unbelievable. Here’s one cryptocurrency trader’s altcoin trade that stands out for the transaction fee he paid.
Paid 120 Thousand Dollars Transaction Fee for 156 Thousand Dollars Altcoin
On-chain data shows that on May 8, a cryptocurrency trader paid over 64 ETH in transaction fees to buy 84 ETH of four (FOUR), a newly minted memecoin on the Ethereum Blockchain based on the “4” meme made famous by Binance CEO CZ and heavily used by the cryptocurrency community on Twitter. This means that the cryptocurrency trader paid over $120,000 in transaction fees to buy $156,000 worth of FOUR tokens.
However, some on-chain analysts point out that the investor was the second investor to buy FOUR and has now made an unrealized gain of around $240k.
Data from DEXTools, one of the best decentralized token data analysis platforms, shows that the FOUR token reached a trading volume of $136 million on its first trading day and had a market capitalization of $30 million as of May 9. On-chain data shows that the FOUR token’s first batch of investors earned between $240,000 and $2 billion. This explains why investors were willing to pay extremely high transaction fees to purchase the token.
Ethereum Gas Fees Skyrocket
The memecoin hype, which has become a hot topic in the cryptocurrency world, has sent the Ethereum Blockchain’s gas fees skyrocketing. Gas is used to refer to the ETH paid by Ethereum users to ensure that transactions made by network validators are included in the first block as quickly as possible.
Gas incentivizes validators to serve the highest transaction fee payer, rather than on a first-come, first-served basis. This means that the transaction fee for popular tokens can be up to thousands of dollars.
