Ross Ulbricht - Tied Crypto Wallets Suffer $12M Loss in Memecoin Mishap: Arkham
Ross Ulbricht - tied crypto wallets have experienced a substantial setback, losing $12 million in a memecoin misstep, as reported by blockchain analytics firm Arkham Intelligence. The wallets, associated with the recently pardoned Silk Road creator Ross Ulbricht, made a costly blunder during memecoin trading activities.
Arkham revealed in a Jan. 30 post on X that Ulbricht, or a user operating his wallets, "accidentally nuked the price" of a fan - made memecoin named ROSS. This memecoin was created following Ulbricht's release from prison. The incident occurred while attempting to provide liquidity on the decentralized exchange (DEX) Raydium.
"Because he initialized the liquidity pool at the wrong price, $1.5M worth of the token (5% of the supply) was instantly snatched up by a MEV Bot, which then sold the tokens into the existing pool," Arkham elaborated. The mispriced tokens became immediately available for trading at a lower price, allowing the maximal extractable value (MEV) bot to swiftly buy and sell them for a profit. MEV bots are designed to scan for profitable trading opportunities and execute trades rapidly and automatically.
The Ulbricht - tied wallet repeated the same mistake, resulting in an additional loss of $10.5 million, which was approximately 35% of the token supply, according to Arkham. "Ross tried to add single - sided liquidity to sell the coins off passively, but accidentally created a pool with Raydium's Constant - Product Market Maker (CPMM) instead of the Concentrated Liquidity Market Maker (CLMM)," Arkham stated.
Based on Arkham's data, the MEV bot sold off the tokens for over $600,000. The ROSS memecoin crashed by 90% as a consequence of the bot's actions of scooping up the mispriced tokens and dumping them into the market.
DEX Screener indicates that ROSS is currently trading at around 1 cent and has seen a significant 700% increase over the last day.
Both wallet addresses flagged by Arkham are listed for donation on FreeRoss.org, a campaign initiated by Ulbricht's family to secure his release from prison. Ulbricht's Solana donation address had received 50% of the ROSS supply from the developer.
Even after losing 40% of the supply, Arkham noted that the wallet addresses still hold 10% of the ROSS token supply, which is valued at around $200,000.
Ross Ulbricht was the operator of the online black market Silk Road, which utilized Bitcoin for transactions, until his arrest in 2013. In 2015, he was sentenced to a double life term plus 40 years in prison. However, on Jan. 22, US President Donald Trump pardoned Ulbricht, fulfilling one of his crypto - related campaign promises.