Extractors
Exchange rebate traders: Like those large-scale traders on platforms like YouTube and Weibo, by promoting exchange invitation links, they can earn high commissions. A successful trader can earn up to a million RMB in commissions in a month, and top YouTubers like MoonCarl can even make tens of millions of dollars a year. Furthermore, professional SEO teams optimize search engine keywords to prioritize their invitation links, allowing top teams to earn hundreds of thousands to millions in a month during bull markets.
Paid community creators and information intermediaries: Some influential figures in the cryptocurrency space establish paid communities after accumulating enough followers, generating annual revenues of over a million RMB. Additionally, if they are aware of exchange-related activities and promote them in their groups, they can earn referral fees when group members register through their links, making significant profits.
Smart traders
Computer faction:
On-chain arbitrage: Mostly early adopters who use tools like Fiddler for 'fleece' activities, they develop programs to participate in digital currency airdrops, events, fair launches, whitelists, etc., in bulk. As long as they confirm that someone will take over and profit later, they will take action to earn returns.
On-chain MEV: Profiting by capturing the price slippage that retail traders generate during transactions. Although competition is fierce, top MEV bots can earn millions of dollars a month, indicating that it is indeed lucrative.
On-chain - CEX arbitrage: When speculative funds and manipulators trigger significant price differences in centralized exchanges (CEX), arbitrageurs buy chips on-chain and hedge on CEX contracts, slowly selling off as prices return, realizing risk-free arbitrage.
Statistical arbitrageurs: They exploit the correlations between different cryptocurrencies in the market by writing sophisticated programs to calculate their historical correlations. When the price deviations between coins reach a certain level, they perform arbitrage, uncovering profit opportunities from market participants' psychology and price linkage.
Market makers: Their main job is to earn the spread, but they also participate in statistical arbitrage, delay arbitrage, and even venture capital (VC) activities, enhancing their investment returns through various methods.
News trading: Traders rooted in this field profit by utilizing the time lag in information acquisition by retail investors and the delay in market makers' order cancellations. They trade quickly before retail investors react to news, thus securing profits.
Comprehensive data stream factions: By closely monitoring market IO positions, large order transaction data, and movements of major addresses, they grasp capital flows faster than ordinary investors, essentially making money from information lags.
Rule-breakers
Market manipulators (secondary market manipulators): They stockpile a large amount of low-market-cap altcoin spot positions in advance, then drive up prices to attract retail investors to buy in under the 'fear of missing out' (FOMO) mentality, and then slowly sell off. Even if the coin price drops by 50%, they can still profit due to their initial low-cost stockpiling, manipulating price trends with their financial and informational advantages.
Token issuance MCN (primary market manipulators): They quickly issue tokens using hot events, employ fully automated deployment systems to add liquidity and distribute rat trading addresses, create false trading booms with numerous addresses, and bribe relevant KOLs for promotion. After attracting retail investors, they either slowly sell off or dump large amounts in one go (rug), deceiving retail investors to gain profits. However, this type of market manipulation, although relatively rampant in some non-European and American countries due to the lack of 'market manipulation' legislation as cryptocurrencies are treated as commodities, ultimately undermines market fairness and normal order.
Overall, these groups in the cryptocurrency space that seem to continuously make money often do so through high-risk means. Especially the actions of rule-breakers can cause serious harm to the entire market ecosystem and ordinary investors, and may face uncertainty due to tightening regulations at any time.
