Article source: Wu Says Blockchain
Editor | Wu Says Blockchain
Recently, well-known grid trader HAZE was dubbed the 'dog-fighting fool' after losing $350,000 in meme trading. In this podcast, we discussed the process of trading memes with him and the specialized meme on-chain tool GMGN he helped create. With the meme market booming, GMGN, a product of internal entrepreneurship, has become a hot project with considerable daily revenue. Whether GMGN will establish a 'fool index' based on HAZE's experience and its future development plans is also a key point of discussion 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, second only to PHOTON ($330 million), surpassing BULLX ($67 million), ranking second in the product line, with a single-day fee revenue of $710,000 and a single-day user count of 25,000.
Please note that the content of this article represents the personal opinions of the interviewee and does not represent the views of Wu Says. Wu Says does not endorse any tokens or projects, and readers should strictly comply with local laws and regulations. There are significant security risks with on-chain tools, and readers should use them with caution.
HAZE: Why is HAZE called the 'fool' of Memecoin?
Colin: Hello everyone, welcome to this episode of our podcast. This episode features a familiar friend, HAZE. He has recently gained some popularity on Twitter, and this time it’s a more relaxed topic. HAZE, please tell us why you are referred to as the 'fool indicator' in Memecoin trading? Share with everyone.
HAZE: Hello everyone, I am HAZE, the consultant for the GMGN project. The so-called 'fool' is actually quite simple: it's constantly playing with low-quality tokens on-chain, with large amounts of money and small amounts of money all in. However, I believe to break the inherent thinking, one still needs to pay tuition. If you play with Memecoin using traditional second-tier market thinking or value coin investment thinking, you will basically end up with a lot of losses. In the end, the tuition fees will all be paid in full to the on-chain and become the liquidity for friends in various dog groups. That's why I lost $350,000. But this account was originally used to play with dogs; it's a typical 'tuition account'. Recently, there has still been profit. If there hasn't been profit recently, then you really are a fool, hahahaha.
The origin and naming of the GMGN product.
Colin: I remember when we chatted before, Memecoin wasn’t very popular yet, and you started developing this product, right? Can you introduce the history of this product to me?
HAZE: That's right. Last year, because I like to pay attention to new products, my entire investment thinking system is product-driven. During the DeFi period, I had a relatively smooth investment experience, but this year, the performance of value coins has not been good. So, I have been looking for new narratives. Initially, I saw the product UniBot. It solved the transaction speed issue for users on the Ethereum chain, allowing users to obtain early costs for some projects ahead of time. I felt this product met a strong user need, and the business model was also good. However, after the experience, I always felt that TG Bot products definitely do not provide a popularized user experience.
So at that time, I was thinking, can we create a product with an excellent experience that allows everyone to quickly rush into projects while also making the visualization and experience data 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 something crypto native 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, catchy, and simple name. At that time, 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 for community users and is friendly and approachable, thus we named it GMGN. Our slogan at the time was: GMGN, Degen everyday.
This is a very native slogan, hoping that everyone can open GMGN every day, rushing on-chain while making money. The positioning and name of the product come from this.
Migrating from the Ethereum chain to Solana, the 'rat trading' feature exploded.
Colin: Since last year, how have you gradually developed?
HAZE: Actually, we first entered the Ethereum chain. Because I have confidence in Ethereum's cycle. At that time, emerging coins like MOG and BITCOIN (HarryPotterObamaSonic10Inu) were all on the rise. I thought, can we do this based on the Ethereum chain? However, during the process, I found that the user sentiment, asset issuance effects, and transaction speed on the Ethereum chain indeed had some contradictions. Originally, we sought fast entry and exit with high risk and high return, but the trading experience was not smooth enough, which was still 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 surge in 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 entering Solana while considering Blast and Base as alternatives and fully support a multi-chain model. Thus, we entered Solana. However, during the BOME surge in March, we actually didn't benefit much. Because the initial layout was still focused on Ethereum, and we didn't fully deploy to Solana in time.
Later, around April and May, after GMGN went live, I promoted it on Twitter, and everyone provided feedback that the dashboard function was quite useful. Users could continuously mine smart money addresses, analyze the operations of large holders, and conduct address judgment and data analysis. During this phase, we gradually accumulated some seed users. With seed users, the product demand updates and iterations became closer to actual user needs.
What really made GMGN explode on a large scale was the 'rat trading' feature. The inspiration for this feature came from user feedback and our intuitive feeling. On-chain asset data is so transparent that we thought we should utilize this transparency better. Therefore, we launched the rat trading labeling feature. For example, when rushing into a project, users are most concerned about whether there is rat trading involved in that project. After adding this feature, we can clearly label which projects have rat trading.
In April and May of this year, after the 'rat trading' feature went live, it further promoted explosive growth based on the good reputation of finding smart money. Many users in the community discussed how GMGN labels rat trading data, such as how many rat trading addresses a project has. This level of discussion rapidly increased GMGN's popularity.
The addition of more users has also made our previous smart money address feature more popular. We have clearly labeled the data of addresses, even matching some information from Twitter. Users can also follow and add notes.
Many users have started writing tutorials, such as 'I found a smart money address that made this much money', and then sharing how to deeply use GMGN for data mining. When such content is published on Twitter, it has been unexpectedly effective. Consequently, more and more creators are producing content based on GMGN's features. Whether in Chinese or English, many high-traffic posts on Twitter are using GMGN's dashboard function. During this phase, GMGN's popularity began to truly explode.
Recently, due to the gradual heating of the Memecoin market, more and more people are recommending GMGN. In the past few days, GMGN's server has crashed 6 times in 4 days due to overwhelming traffic.
Colin: So, are you saying there were a few days of downtime?
HAZE: Haha, yes, yes, yes. Server traffic surged, and everyone had high demand for buying and selling Memecoin using GMGN. At that time, our R&D team barely slept and worked overtime to expand capacity, but still couldn't keep up with the speed of user rush. Thus, the server was overwhelmed 6 times in just 4 days.
This is completely an unexpected situation. According to our operational experience, we have already made 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. Here, we also want to thank all users of GMGN; your support has led to such results. Of course, we will continue to work hard to optimize the servers.
Colin: So what is the current user growth trend? Are there any significant growth milestones?
HAZE: Overall data, everyone can check on-chain. Our data over the past two weeks shows that trading volume has surged by 600%.
Colin: So what is the current team size of GMGN? How many people are there?
HAZE: About 30 people.
Reviewing security incidents from other platforms, we will optimize security plans.
Colin: Recently, a certain product had a safety incident. What improvements will you make regarding safety?
HAZE: Recently, there has been much discussion about a certain meme product's safety incident, with various analyses and evidence circulating on Twitter. From the current information, it seems that it utilized plaintext transmission for private keys, which is basically a sign of having no security protections in place. Furthermore, based on the exposed theft process, funds were transferred one-to-one from the user address to the hacker address, indicating that the server was likely hijacked. Since the private keys were in plaintext, once the server was compromised, the users' private keys were fully exposed, allowing the hacker 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 user funds. If you do this, you need to take various technical measures to ensure security, such as encrypting private keys for storage, establishing a complete internal control system, and ensuring strict isolation between business servers and secure storage servers. You also need to ensure platform security through offline solutions and real-time monitoring.
Assuming funds are really stolen, the first step is to quickly discover the problem and minimize losses at sensitive nodes. If the scale of theft is small, the platform can quickly compensate users with its own revenue. Because there is no 100% secure system, the key is the ability to respond quickly and compensate users. These measures can allow the platform to achieve a higher standard of safety.
Our team has emphasized safety from the very beginning and has built a complete professional security team. We have experienced the internet wave, traded coins, and witnessed large fund flows, fully aware of the 'dark forest law' in the blockchain industry. We also understand that platform security is the most basic guarantee.
GMGN provides two user experience modes. One is the TG Bot mode, where users' private keys are hosted on the server, meeting the strategic and speed needs of advanced users. The other is for users to connect directly to the GMGN website for transaction interaction through plugin wallets like Phantom or MetaMask, requiring user authorization for each operation, which is relatively safer.
We have invested a lot of effort in both the front-end and back-end, continuously optimizing security mechanisms. Based on the recent security issues with a certain product, we will further learn lessons and fill in the gaps. We will adopt a more cautious attitude to improve the overall security of the platform.
Future development strategy: stable service and continuous entry into hotspot narratives.
Colin: So have you collected statistics on 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 surge reaped the largest dividends.
Colin: So how do you plan the future products and development strategy?
HAZE: Our product thinking is very simple: First, ensure that the service is stable enough; Second, pursue a faster and more extreme operating experience; Third, seriously record user needs and continuously update based on the urgency of those needs. Our goal is to make the user experience smoother and smoother, basically that’s the idea.
Colin: Are you concerned that the popularity of Memecoin will decline? Or, after the craze passes, will there be issues with the long-term viability of your product?
HAZE: I think GMGN initially entered the Memecoin track, but its essence is an on-chain product. Its positioning is how to closely align with on-chain hotspots and major trends, providing users with good trading opportunities, and helping users seize on-chain dividends. This is the core positioning of GMGN. So, even if Memecoin gradually cools down, or does not have the current momentum, our key is how to determine what the next narrative hotspot is, and the team will consider how to quickly enter.
We are not saying that 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 think in the blockchain world, the switching of hotspots is very fast, and the speed of innovation is also very rapid. Therefore, we must not be biased or remain stagnant. We need to try more, explore more, and find good entry points. If we can solve user pain points, we will enter and execute. At the same time, we will continuously correct and adjust our understanding.
If one is always immersed in the current comfort zone and does not break it, regardless of platform position, one may be surpassed over time.
Development details: 'Fool Wallet', subdivided tracks, 'conspiracy groups', and trading experience.
Colin: Understood, okay. Next, we have two more friends joining the discussion, one is defioasis and the other is Yiyi. They have deep observations and practical experience in the Memecoin field and can discuss some questions with you in depth.
defioasis: I have a few questions. The first is about the 'fool wallet' indicator. Is it possible to launch a similar reverse smart money tool, such as labeling those with extremely low winning rates, where buying means hitting the high point?
HAZE: I think this is possible. If we have time, we can label these wallets and categorize them as wallets with extremely low winning rates. First, include me in that list, hahahaha.
Colin: I feel like this idea is quite interesting, haha.
HAZE: Yes, many users who chase highs often buy at peaks, and then the price starts to drop. So it can serve as an indicator to assist trading decisions.
defioasis: Yes, this might be a good selling indicator. The second question is, Memecoin is a big 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 features in GMGN so that users can see the hotspots at a glance?
HAZE: The demand for sector classification has indeed been mentioned before. Some users are not trading every day; they may have heard that a certain sector is hot and want to come in and buy a bit. At that time, providing an intuitive display of market value and price will be very helpful. We will consider adding these classifications in future updates.
defioasis: Another question, GMGN has two entry points, one is the TG Bot and the other is the plugin wallet. Have you collected statistics on which entry has a higher user volume and more transaction volume?
HAZE: Recently we haven't done such data statistics.
Yiyi: I have two questions. First, the community is currently particularly interested in two things besides smart money: the first is to discover 'conspiracy groups', and the second is to guess who will be listed by Binance. GMGN has strong data analysis capabilities, especially in smart money. So do you have plans to further explore these related addresses, such as labeling addresses that may involve conspiracy behavior?
HAZE: We have partially implemented this. We initially launched the rat trading feature and later added the 'fish' label. We will label suspected conspiracy wallets as 'red fish', and the labeling logic includes: operations on multiple wallets at the same time, consistent fund transfer behaviors, etc. For example, I recently tested an address, and the data clearly showed that the address is a distribution address, labeled as 'red fish', with an additional red exclamation mark prompt.
HAZE: In addition, we also have a wallet distribution analysis function, for example, the distribution behavior of DEV wallets will be marked 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 subjective labeling.
Yiyi: Understood. My second question is, can the K-line tool be combined with on-chain data? For example, I define a time window and want to know who was driving the major upward trend and who was making money during that period. Can this be a development direction for GMGN?
HAZE: We currently lean towards providing data functions that are universal across large platforms. The needs you mentioned belong to customized functions, which require more resource investment. Our primary task is to meet the most popular demands, but in the future, if more users propose similar needs, we will evaluate and consider adding these features.
Yiyi: What will be the focus of GMGN's next iteration? Will you launch some other expected features?
HAZE: We already have chip distribution features, as well as wallet labeling and dispersive map features. The focus in 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 wallets. In addition, the monitoring push needs for TG Bot and channels will also be optimized. Currently, the push function of GMGN will have delays when the user volume is too large, and we will prioritize solving this issue.
Our goal is to help users discover information faster, stay informed about dynamics faster, and complete transactions faster. The current updates mainly focus on these core needs.
