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BeginnerLesson 2 of 7 · 3 min read

Why people trade them

Big moves, low entry and a lot of fun, and the part nobody advertises: you are trading against other people and bots, and fees take a cut of every trade.

On this page
  1. The reasons people give
  2. Who is on the other side of your trade
  3. Doing it yourself, or letting a bot do it
  4. Quiz

Ask ten traders why they're in memecoins and you'll hear ten versions of the same answer: it's the fastest game in crypto.

The reasons people give

  • Big moves. A stock moving 10% in a day is news. A new memecoin can move 10 times in an hour, up or down.
  • Small entry. You can start with a few dollars. No broker, no account approval, open every hour of every day.
  • Being early. In theory anyone can find a coin in its first minutes. In older markets the early rounds belong to insiders and funds.
  • Culture. The jokes, the group chats, the shared wins and losses. For a lot of people it's a social thing first.
  • Attention as a bet. A memecoin is a bet that a joke, a person or a story gets more attention tomorrow than today.

Who is on the other side of your trade

Here is the part nobody puts in the ads. When you buy a memecoin, someone sells it to you. When you sell, someone buys. No company is earning money in the background. So the money a winner takes out comes mostly from people who bought later and sold lower.

Traders call this PvP, player versus player. You are trading against snipers who bought in the first second, the dev who made the coin, insiders who knew early, bots that react in milliseconds, and people exactly like you.

Every trade also pays fees: the platform's fee, the fee the coin's own pool or launchpad charges (1.25% on a pump.fun coin's bonding curve as of October 2026, whatever app you use), the network fee, and often a priority fee or tip to get in faster. None of that money goes to other traders, so it leaves the game for good. In a zero-sum game, every dollar one player wins, another player loses. Memecoin trading is worse than that: fees take a cut of every trade, so as a group, traders lose more than they win. Then there is slippage, the gap between the price you saw and the price you got. That money does not vanish. It ends up with other traders, sometimes a bot that jumped in just ahead of you.

The costs on one tradeA bar for one buy. Most of it reaches the coin, and six slices come off the end: the network fee paid to Solana, which is tiny; an optional priority fee so validators pick your transaction first; a tip some apps add to land the trade faster; the trading app's platform fee on each buy and sell; the fee the coin's launchpad or pool takes on every swap, part of which often goes to the coin's creator; and slippage, the price moving against you before you fill. You pay them again when you sell. Not to scale.One buy, and what it costsWhat reaches the coinNot to scaleNetwork feePaid to Solana for every transaction. Tiny.Priority feeOptional extra so validators pick yours first.TipA bonus some apps add to land the trade faster.Platform feeThe trading app's cut of each buy and sell.Pool or launchpad feeThe launchpad's or pool's cut, part to the creator.SlippageThe price moving against you before you fill.You pay them again when you sell.
Every buy and every sell pays a stack of small costs. They add up fast.
Example

What costs do to a busy trader

Say every buy and every sell costs you 2.25%: a 1% app fee plus the 1.25% fee on a pump.fun coin's curve, before network fees and slippage. Real costs depend on the app, the coin and how busy the network is. This shows the shape.

  1. Step 1: You buy $100 of a coin. After costs you hold $97.75 worth.
  2. Step 2: The price doesn't move. You sell. After costs you get $95.55 back.
  3. Step 3: You repeat that 20 times in a day, always at a flat price: 20 buys and 20 sells.
  4. Step 4: You end the day with about $40.24. The chart never went against you, and costs took about 60% of your money.

Real trades are rarely flat, so this drag comes on top of your wins and losses. It is one reason careful traders trade less often than you would expect.

Doing it yourself, or letting a bot do it

Some people love the hands-on game: hunting coins, reading charts, sharing calls with friends. Others want to take part without staring at a screen all night. Automatic trading bots, Trenchpilot among them, follow a fixed set of rules for you. A bot doesn't remove the risk, still pays costs on every trade, and can't promise a profit. What it can take away is the 3 a.m. impulse buy. Both paths are real choices.

Whichever way you go, practise with paper money first. It costs nothing and shows you how fast things move before real money is on the line.

Check what you learned

0 of 4 answered

  1. Question 1In memecoin trading, where does a winner's profit mostly come from?
  2. Question 2TrickyYou buy and sell the same coin 10 times, always at the exact same price. Where is your money?
  3. Question 3What does PvP mean in the trenches?
  4. Question 4Which is the safest way to think about money you put into memecoins?

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This guide is for learning. It is not financial advice. Most memecoins go to zero and most people who trade them lose money. Only ever trade what you can afford to lose.