Editor | Wu Talks Blockchain
Recently, well-known grid trader HAZE was dubbed the "dog trader idiot" after losing 350,000 USD in meme trading. In this podcast, we talked with him about the process of trading memes and the on-chain tool GMGN he helped establish. With the meme market booming, GMGN, a product of internal entrepreneurship, has become a hot project with considerable daily revenue. Whether GMGN will create an "idiot index" based on HAZE's experience and its future development plan is also a key discussion point in this podcast.
According to @adam_tehc's Dune data panel, the on-chain MEME trading tool GMGN reached its current peak trading volume on November 17, with a single-day trading volume of 72 million USD, second only to PHOTON (330 million USD), surpassing BULLX (67 million USD), ranking second in this product line, with a single-day fee income of 710,000 USD and a single-day user count of 25,000.
Please note that the content of this article represents the personal views of the interviewee and does not represent the views of Wu Talks. Wu Talks does not endorse any tokens or projects, and readers should strictly comply with local laws and regulations. On-chain tools carry significant security risks, and readers should use them with caution.
Why is HAZE called the Memecoin "idiot"?
Colin: Hello everyone, welcome to this episode of our podcast, featuring the familiar friend HAZE. He has recently gained some popularity on Twitter, and this is a relatively casual topic. HAZE, please start by telling us why you are called the "idiot indicator" in Memecoin trading? Tell everyone about it.
HAZE: Hello everyone, I am HAZE, the advisor of the GMGN project. The so-called "idiot" is actually very simple, which is continuously engaging in dogecoin trading on-chain, rushing in with various amounts of capital. However, I believe to break the inherent mindset, you still need to pay tuition. If you approach Memecoin trading with traditional secondary market or value coin investment thinking, you will basically end up losing a lot. Ultimately, the tuition that needs to be paid is all given to the on-chain, becoming liquidity for various dogecoin trading groups. This is why I lost 350,000 USD. But this account was initially used for dogecoin trading, which is a typical "tuition account". Recently, there are still profits to be made. If you are not making money recently, then you are really an idiot, haha.
The origin and naming of the GMGN product.
Colin: I remember that when we talked before, Memecoin wasn't very hot yet, and you started developing this product, right? Can you give me an overview of the product's history?
HAZE: Yes, last year, because I was quite interested in new products, my entire investment thinking system was product-driven. During the DeFi period, my investments were quite smooth, but this year's performance of value coins has not been good. Therefore, I have been seeking new narratives. But initially, it was seeing the product UniBot. It solved the trading speed problem for users on the Ethereum chain, allowing users to obtain early costs for some projects in advance. I felt that this product addressed some of the users' urgent needs and had a good business model. However, after the experience, I always felt that a product like TG Bot was definitely not a mass-market user experience.
So at that time, I was thinking, can we create a product with a great experience that allows everyone to quickly rush to projects while making the entire visualization, experience data, and other aspects intuitive and smooth? In July of last year, there was an independent team that had the capability to do this, but they asked me what the product should be named. I said, let's call it GMGN.
In terms of naming, I believe a good name is half the success. GMGN itself is a crypto-native element in the on-chain community. I wanted to use some vocabulary originating from community language to name this product. I think GMGN is a friendly, easy to remember, and simple name. When playing with NFTs, everyone often used greetings like GM (Good Morning) and GN (Good Night). So we hope this product provides an excellent user experience to community users, and is friendly and approachable, which is why we named it GMGN. Our slogan at that time was: GMGN, Degen every day.
This is a very native slogan, hoping that everyone can open GMGN every day, rush on-chain, and earn money. The product positioning and name came from that.
Migrating from the Ethereum chain to Solana, the "mouse warehouse" feature exploded.
Colin: Since last year, how have you gradually developed?
HAZE: Actually, at that time, we first entered the Ethereum chain. Because I was confident about the Ethereum cycle. At that time, emerging coins like MOG and BITCOIN (HarryPotterObamaSonic10Inu) were rising. I thought, can we do this based on the Ethereum chain? However, during the process, I found that there were indeed some contradictions in user sentiment, asset issuance effects, and transaction speed on the Ethereum chain. The initial pursuit was for quick entry and exit with high risk and high return, but its trading experience was not smooth enough, which was a problem. So we began to consider whether we needed to switch chains. Our target chain options included Blur's Blast, Coinbase's Base, and Solana.
In January, there happened to be a wave of excitement around Solana. When I observed the trend of Solana, I felt that choosing Solana was more appropriate. Because Solana is more mature compared to other chains and has been around longer. After team discussions, we decided to prioritize Solana while considering Blast and Base as alternatives, and fully support a multi-chain model. Thus, we entered Solana. However, during the BOME wave in March, we actually did not reap many benefits. This is because the initial layout was still on Ethereum and was not fully deployed to Solana in time.
Later, around April and May, after GMGN went live, I promoted it on Twitter, and everyone gave feedback that the dashboard feature was quite useful. Users can continuously explore smart money addresses, analyze the operations of large holders, and conduct address assessments and data analysis. During this stage, we gradually accumulated some seed users. With seed users, the updates and iterations of product needs became closer to actual user requirements.
What really made GMGN widely popular is the "mouse warehouse" feature. This feature was inspired by user feedback and our intuitive feelings. On-chain asset data is so transparent that we felt we should better utilize this transparency. Therefore, we launched the mouse warehouse labeling feature. For example, when rushing for a project, users are most concerned about whether this project has a mouse warehouse. After adding this feature, we can clearly label which projects have a mouse warehouse.
In April and May of this year, after the "mouse warehouse" feature went live, it further propelled explosive growth on the good reputation of finding smart money. Many users in the community discussed how GMGN labels mouse warehouse data, such as how many mouse warehouse addresses a project has. This level of discussion rapidly increased GMGN's popularity.
More users joining has also made our previous smart money address feature more popular. We have clearly labeled the data of addresses and even matched some information from Twitter. Users can also follow and add notes to features.
Many users started writing tutorials, such as "I found a smart money address, and this address earned how much money," then shared how to use GMGN for deep data mining. The effect of this content published on Twitter was unexpectedly good. Thus, more and more creators produced content based on GMGN's features. Whether in Chinese or English, now when searching on Twitter, many high-traffic posts are using GMGN's dashboard feature. At this stage, GMGN's popularity truly exploded.
Recently, due to the gradually heating Memecoin market, more and more people are recommending GMGN. In the past few days, GMGN's servers have been overwhelmed six times within four days.
Colin: Are you saying it went down for several days?
HAZE: Haha, right, right, right. Server traffic surged, and everyone had high demand for buying and selling Memecoin using GMGN. At that time, our R&D team basically didn't sleep, working overtime to expand capacity, but still couldn't keep up with the pace of user rush. As a result, the server was overwhelmed six times in just four days.
This is completely an unexpected situation. According to our operational experience, we have actually done a lot of redundancy in traffic data. It can only be said that the heat of the Memecoin market far exceeded our expectations, which also proves everyone's affirmation of the GMGN product. We would also like to thank all users of GMGN; it is your support that led to this result. Of course, we will continue to work hard to optimize the server.
Colin: What is the current user growth trend? Are there any significant growth milestones?
HAZE: Overall data can actually be queried on-chain. Our data from the past half month indicates that trading volume has skyrocketed by 600%.
Colin: What is the current team size of GMGN? How many people are there?
HAZE: About 30 people.
Review other platforms' security incidents and optimize security plans.
Colin: Recently, a certain product had a security incident. What improvements will you make regarding security?
HAZE: Recently, there has been a lot of discussion about a certain meme product's security incident, with various analyses and evidence surfacing on Twitter. From the current information, first of all, it used plaintext transmission for private key transfer, which basically shows no security protection. Looking at the stolen process that was exposed, funds were transferred one-to-one from user addresses to hacker addresses, indicating that the server was likely hijacked. Because the private keys were plaintext, once the server was compromised, users' private keys were completely exposed, allowing hackers to easily transfer funds.
Regardless of the situation, security is the top priority for custodial platforms. For products like TG Bot, hosting user private keys is equivalent to hosting users' funds. If you do this, you need to adopt various technical measures to ensure security, such as encrypting and storing private keys, establishing a comprehensive internal control system, and ensuring strict isolation between business servers and secure storage servers. Additionally, offline solutions and real-time monitoring are needed to ensure platform security.
If funds are really stolen, the first step is to quickly identify the problem and stop losses promptly at sensitive nodes. If the scale of the theft is small, the platform can quickly compensate users with its own revenue. Since there is no 100% safe system, the key lies in the ability to respond quickly and compensate users. These measures can help the platform achieve higher security standards.
Our team has paid great attention to security from the very beginning, establishing a complete set of professional security teams. We have experienced the internet wave, traded coins, and witnessed large capital flows, fully understanding the "dark forest rule" of the blockchain industry. We also realize that platform security is the most basic guarantee.
GMGN offers two user experience modes. One is the TG Bot mode, where user private keys are hosted on the server, meeting the strategy and speed needs of advanced users. The other is for users to connect to the GMGN website directly through plugin wallets like Phantom or MetaMask for trading interactions, where each operation requires user authorization confirmation, which is relatively safer.
We have invested a lot of effort in both the front and back ends, continuously optimizing security mechanisms. Based on the recent security issues of a certain product, we will further learn from our lessons and address any gaps. We will adopt a more cautious approach to enhance the overall security of the platform.
Future development strategy: stable service and continuous entry into hot narratives.
Colin: Have you ever statistically analyzed your market share? What is the approximate ratio?
HAZE: In terms of overall market share, we should be in a relatively leading position globally. Our main competitor is Photon, which has a significant first-mover advantage on Solana. The BOME wave took the largest dividends.
Colin: What are your subsequent product and development strategy plans?
HAZE: Our product philosophy is very simple: First, ensure that the service is stable enough; second, pursue faster and more extreme operational experiences; third, seriously record user demands and continuously update based on the urgency of those demands. Our goal is to make the user's experience smoother and smoother; that is basically our philosophy.
Colin: Are you worried about the decline in popularity of Memecoin? Or, after the craze passes, will there be problems with the long-term viability of your product?
HAZE: I believe GMGN initially entered from the Memecoin track, but its essence is an on-chain product. Its positioning is how to closely follow on-chain hotspots and trends, provide users with good trading opportunities, and help users capture on-chain dividends. This is GMGN's core positioning. Therefore, even if Memecoin gradually cools down or loses its current momentum, our key is how to judge what the next narrative hotspot is, and the team will consider how to quickly enter.
Rather than saying we only focus on Memecoin, it is a part of GMGN and currently the main part, but it is by no means the only part. I believe that in the blockchain world, the switching of hotspots is very fast, and the speed of innovation is also rapid. Therefore, we cannot have biases, nor can we stand still. We need to try more, explore more, and find good entry points. If we can solve users' pain points, we will enter and execute. At the same time, we will continuously correct and adjust our understanding.
If one remains immersed in the current comfort zone without breaking it, regardless of the platform's position, over time, they may be surpassed.
Development details: "idiot wallet", segmented tracks, "conspiracy groups" and trading experience.
Colin: Understood, OK. Next, two friends will join the discussion, one is defioasis and the other is Yiyi. They have in-depth observations and practical experience in the Memecoin field and can discuss some questions with you.
defioasis: I have a few questions. The first is about the "idiot wallet" indicator. Is it possible to launch a reverse smart money tool, such as labeling those wallets with extremely low win rates that buy at high points?
HAZE: I think this is possible. If we have time, we can label these wallets and classify them as wallets with extremely low win rates. First, include me in there, haha.
Colin: This idea sounds quite interesting, haha.
HAZE: Yes, many users who chase high points often buy in at peaks, after which the price starts to fall. So it can serve as an auxiliary indicator for trading decisions.
defioasis: Yes, this could be a good sell indicator. The second question is, Memecoin is a large track, which is further divided into many sub-tracks, such as the recent AI Memecoin and DeSci. Is it possible to optimize the sector classification and sector rotation function in GMGN so that users can easily see the hotspots?
HAZE: The demand for sector classification has indeed been mentioned. Some users are not engaged in dogecoin trading every day; they may have heard that a certain sector is hot and want to come in and buy some. At this time, providing an intuitive display of market cap and price would be very helpful. We will consider adding these classifications in future feature updates.
defioasis: One more question, GMGN has two entry points, one is TG Bot and the other is a plug-in wallet. Have you ever statistically analyzed which entry point has a higher user volume and more transaction volume?
HAZE: Recently, we have not done such data statistics.
Yiyi: I have two questions. First, the community is particularly interested in two things besides smart money: the first is finding "conspiracy groups", and the second is guessing who will be listed on Binance. GMGN's data analysis capability is very strong, especially in smart money. So do you have plans to further explore these related addresses, such as labeling which addresses might be involved in conspiracy activities?
HAZE: We have partially implemented this. We first launched the "mouse warehouse" feature, and later added the "fish" label. We will label suspected conspiracy wallets as "red fish", with labeling logic including: operations on multiple wallets at the same time, consistent fund transfer behavior, etc. For example, I recently tested an address, and the data clearly showed that this address was a distribution address, labeled as "red fish", with an additional red exclamation mark prompt.
HAZE: In addition, we also have a wallet distribution analysis feature, for example, the distribution behavior of DEV wallets will be labeled with a "sniper" icon. For the conspiracy groups mentioned by users, we will continue to identify and determine them through on-chain data, but will try to avoid labeling them subjectively.
Yiyi: Understood, my second question is, can the K-line tool be combined with on-chain data? For example, if I define a time window, I want to know who was driving the price up and making money during a certain main wave. Could this be a development direction for GMGN?
HAZE: We currently prefer to provide data functions that are general for large platforms. The needs you mentioned fall under customized features, which require more resource investment. Currently, our primary task is to meet the most common needs, but in the future, if more users propose similar needs, we will evaluate and consider adding those features.
Yiyi: What are GMGN's priorities for the next iteration? Will there be other exciting features launched?
HAZE: We already have a chip distribution function, as well as wallet labeling and dispersion graph functions. The focus for the future will still be on improving the overall stability, speed, and experience of transactions. For example, the highly requested "wallet monitoring" function will expand from supporting 100 wallets to 500. Additionally, the monitoring push needs of TG Bot and the channel will also be optimized. Currently, GMGN's push function has delays when the user count is too high, and we will prioritize solving this issue.
Our goal is to help users discover information faster, become aware of dynamics quicker, and complete transactions more swiftly. Current updates mainly focus on these core needs.
