The following text is organized from the Twitter Space series #Dialogue Traders, hosted by FC, founding partner of SevenX Ventures, Twitter @FC_0X0.
Guest this episode: Honest CEO Mai, Twitter @Michael_Liu93.
CEO Mai's MEME journey: After a five-minute return of hundreds of times, he starts to become addicted to MEME.
Before getting into Crypto, CEO Mai followed a very 'orthodox' financial path: studying finance at university, entering sell-side as a banker after graduation, and then moving to buy-side. At buy-side, he was looking at the enterprise services sector, during which many blockchain founders wanted to create BAAS (Blockchain as a Service), and through this opportunity, he saw this new technology.
By 2020 and 2021, CEO Mai officially entered the Crypto industry, managing some secondary positions for bosses in traditional finance, mainly Bitcoin. Since then, he has begun spending a lot of time every day researching new things and looking for Alpha.
And the Alpha in this cycle, CEO Mai firmly believes, is MEME, so currently, he spends 60% to 70% of his time on MEME and is also getting traditional finance bosses from various CX to come in and play together.
The addiction to MEME originated from a trade that yielded a hundred times return in just five minutes.
At that time, the market was speculating on Elon Musk's signature; CEO Mai took some positions in Dragon 1 TROLL and Dragon 2 ZUZALU, so which coin will become Dragon 3? CEO Mai and his friends felt that Vitalik's signature might have room for speculation, so they bought TCATI (Green Tea), a cat-themed MEME, around a market cap of over 20,000, from Vitalik's X account profile signature.
About five minutes after buying, this coin suddenly skyrocketed to about one or two million in market cap, instantly turning several hundred dollars in position into three or four thousand dollars.
This actually counts as CEO Mai's first real contact with MEME; although the hundredfold return only recouped the original investment, this trading experience made him feel that 'MEMEs are really fun.'
Then he started spending more time studying MEME, understanding MEME, trading MEME, gradually forming his own trading strategy.
Why are strong market makers more fun?
PVP markets are a typical non-mutual achievement game, where everyone is actually competing to discover a trend first, or to create a trend and acquire bottom chips, then when they feel it’s a high point, they dump on everyone and walk away with the profit.
The market game is actually a mutual achievement game between retail investors and the market makers. The market maker wants to push up the market cap during a MEME's life cycle, aiming to get listed on Binance, and thus needs to use their funds to find callers, gather chips, wash chips, pump the price, create advertisements/news, and drive the hype.
If a market maker is very skilled at doing these things, it means they are good at narrative building, have a large financial volume, and have various relationships with callers and exchanges; this situation is a win-win for both retail investors and market makers.
So how can one judge whether a market is a market maker's game?
CEO Mai provided a perspective: observing whether wallets have intentional wash trading behavior, i.e., keeping a certain price range for the same asset and quickly buying and selling within a few seconds. The purpose of the market maker's wash wallets includes:
Can be marked as a new wallet by tools like GMGN.
Disperse chips to prepare for the pump.
However, as the information disclosed by tool merchants increases, the methods of market makers are constantly changing, but this is good news for retail investors because market makers need to gather chips, giving them more time to prepare for the pump, thus retail investors will have more time to identify which market makers are strong.
How does the market maker on Solana operate a MEME?
Early stage: Gather chips in the internal market, launch during the pump.
Due to the 'anti-market maker' sentiment after the capitalization of NEIRO, the market makers initially hid themselves, allowing MEME to appear as a so-called community-driven project, and during this process, they began to gather chips.
In the process of gathering chips in the internal market, the market maker's biggest enemy is Bot. There are now many bots checking pump internal market volumes, and once they detect purchases from new wallets (5-10 SOL), they will quickly follow up.
Once enough chips are gathered, usually to over 75%, they will launch during the pump.
Mid-term: Push volume in batches.
First wave: Launch. Find some Tier 3 and Tier 2 callers, while getting your market makers to cooperate, pushing the market cap to between 5 million to 20 million, and then quickly crash the price.
Second wave: Explosive rise. Deploy the funds obtained from the first wave crash, usually all funds, market making, while finding Tier 1 callers to shout orders, creating a wave of rise that prevents everyone from getting cheaper chips.
Later stage: Listing on exchanges.
Whether it can be listed on exchanges, including Binance, actually depends on fate; the market maker is also looking at fate. If it's successfully listed, the liquidity valve opens, and the subsequent trading aligns with the secondary market.
The market making after listing is mostly operated by Wintermute.
BAN and AI16Z are two typical 'market maker' MEMEs: the market maker gathered chips for a very long time in the early stage, made a large first wave rise, then crashed down to collect enough funds for subsequent market making, while gathering chips at the bottom, and the second wave directly skyrocketed.
How to get on board with strong market makers?
There are two strategies:
First, buy after the first wave ends and before the second wave rises.
At this stage, the market maker is continuously gathering chips at the bottom. If you find traces of their chip gathering (mainly by observing wallets), you can follow up and buy.
Second, once the second wave starts, act decisively to chase.
At this stage, the market maker will likely find Tier 1 callers to cooperate with the funds accumulated from the first wave crash, rapidly pushing the market cap higher, seeking listings. Generally, once the second wave starts, a strong market maker rarely allows the coin price to correct even a little for retail investors to get in. So if you observe that the second wave has started and has already risen beyond the first wave, you can chase and buy at a higher price.
Understanding MEME through the logic of short videos.
In May, when I had a dialogue with Zepump about MEME, he mentioned a viewpoint that MEME is to VC coins what short videos are to long videos. CEO Mai also strongly agrees with this logic and explained the 'commonalities' between short videos and MEMEs from the perspectives of 'hierarchy of needs' and 'evolutionary path'.
First, let's talk about the hierarchy of needs.
Why do people, especially those born after 2000, enjoy endlessly scrolling through short videos and MEMEs every day? Because they satisfy their innermost desires:
Short videos satisfy sensual desires and so-called 'laziness.' Young people's time is fragmented, and they have little entertainment time, so they can only gain very brief pleasure by scrolling through Douyin.
MEME satisfies greed. Today's young people generally feel that the barrier to achieving a leap in wealth is too high, so they all want to take a gamble (to get rich quickly).
Now, let's talk about the evolutionary path.
Short videos initially focused on UGC, user-generated content, but later you find that not many people watch UGC anymore; everyone is watching PGC because PGC has better production quality.
In MEME, everyone started as very naive CTOs, but later found that market making was more fun, as market makers pushed the price higher because they are essentially strong operators with more substantial financial power.
In essence, both short videos and MEMEs are part of a very attention-driven economy market.
In the super cycle of MEME, which coin will become the 'new king'?
CEO Mai firmly believes that MEME has already been established as a long-term trend. When we look back two years from now, most of the MEMEs in today's market may have vanished, but those that can persistently emerge will certainly be more, and there will definitely be a MEME that surpasses SHIB, and this MEME is likely already in the market.
Which coin is likely to become the 'new king'?
First: $DOGE
The true leader in the MEME sector, the 'BTC' of MEMEs, is likely to see DOGE go on ETF after Trump starts his presidency.
Second: $PEPE
The strong point of PEPE lies partly in its early emergence, and partly in its logic that many Chinese cannot understand. In fact, the projects launched on Ethereum are basically derivatives of PEPE, which has already become a consensus. Currently, it is challenging to find a MEME with such a strong consensus as PEPE in this cycle.
Third: $WIF
Fourth: $POPCAT
$WIF VS $POPCAT, CEO Mai is more optimistic about the latter. In fact, there is an interesting point about WIF and POPCAT: although WIF has a market cap double that of POPCAT, their pools are the same.
Now fewer people abroad are discussing WIF with callers from conspiracy groups; attention has shifted to POPCAT, which may also indicate a shift in capital choices.
What callers should you focus on to play MEME well?
Abroad:
Murad @MustStopMurad, Crash @CrashiusClay69, Mitch @idrawline, OverDose @Overdose_AI, Moneylord @moneyl0rd, Ansem @blknoiz06, Spidercrypto @SpiderCrypto0x
Chinese region:
First: The Wizard @0xcryptowizard
The Wizard is a builder; being on his team feels relatively stable because he continues to build, and the projects he builds have very good angles.
Second: magnolia @0xmagnolia
Sister Hat has written a lot of valuable content, teaching everyone how to find MEMEs and how to win in this game. Moreover, Sister Hat often has a strong ability to catch trends, so she can serve as a good reference for where the trend might be.
Third: Timo @timotimoqi
Timo is a friend of CEO Mai in real life, originally both were investors, so their trading perspectives may be quite similar. The tweet discussing the eight questions to ask oneself before buying MEME originated from Timo. ?https://x.com/timotimoqi/status/1847147614963486730
Recently, Timo may have called five or six projects, with three going over a hundred times.
Lastly, I want to say that there is an issue with callers; what may be good a month ago might not be good a month later. For example, POE, who previously posted very well, after exploding in popularity over a month ago, began to call various rug pulls to scam retail investors.
Although you may not know what exactly is happening behind the scenes, the lesson is: when looking at callers, you must look at the overall picture, look comprehensively. It's still analogous to short videos; they are just someone recommending videos to you, not the one who gets you to like them. The right to like must still be in your own hands.
In conclusion
I believe the core of playing MEME is to find the stage and trading method within your capabilities. In fact, no matter when you enter the market, you can always find your opportunities within MEME; this is the most interesting part of MEME during this cycle.
