Crypto wallets tied to Ross Ulbricht, the creator of the Silk Road dark web marketplace, have suffered a significant blow, with losses exceeding $12 million after an apparent trading error involving a memecoin he was linked to. According to blockchain analytics firm Arkham Intelligence, Ulbricht, or someone controlling his wallets, mistakenly triggered a series of events that led to a dramatic drop in the price of the fan-created memecoin called ROSS.

Ulbricht Linked Wallets Faces Loss

The trouble began when Ulbricht’s wallet attempted to provide liquidity on the decentralized exchange (DEX) Raydium, which led to an accidental price misstep. Arkham Intelligence detailed that the liquidity pool was initialized at an incorrect price, allowing a maximal extractable value (MEV) bot to swoop in and take advantage of the situation. MEV bots are automated programs that scan the blockchain for arbitrage opportunities, and in this case, the bot seized 5% of the ROSS token supply—around $1.5 million worth—quickly selling it into the existing pool.

“This misstep essentially nuked the price,” Arkham’s post noted, as the bot profited by snapping up tokens at the mispriced rate. However, the mishap didn’t end there.

In a repeat of the earlier mistake, Ulbricht’s wallet tried to provide liquidity again, but this time, a larger chunk of ROSS—about 35% of the total supply—was lost, translating to a further $10.5 million in losses. The MEV bot once again capitalized on the mispricing, selling the acquired tokens for a profit exceeding $600,000.

A Slight Resurgence

As a result, ROSS crashed by 90%, plunging in value almost instantly. Despite the dramatic fall, the memecoin has seen a slight resurgence, with its value rising by 700% in the last 24 hours, now trading at around one cent.

The wallets involved in this trading debacle are also tied to the FreeRoss.org campaign, a fundraising initiative seeking to secure Ulbricht’s release from prison. Despite the massive losses, the wallets still hold approximately 10% of the total ROSS supply, which is worth an estimated $200,000. Ulbricht’s supporters are hoping that this significant portion will help continue funding his legal battles and campaign for clemency.

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