Article source: Wu Talks Blockchain
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Recently, the well-known grid trader HAZE was dubbed the 'idiot of dog trading' because he lost 350,000 USD trading memes. In this podcast, we talked to him about the process of trading memes and the professional meme on-chain tool GMGN that he co-founded. As meme trading becomes popular, GMGN, as an internally entrepreneurial product, has become a hot project with substantial daily revenue. Will GMGN establish an 'idiot index' based on HAZE's experience and its future development plan? This 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 USD, second only to PHOTON (330 million USD), exceeding BULLX (67 million USD). This product line ranks second, with a single-day fee income of 710,000 USD and a single-day user count of 25,000.
Please note, the content of this article represents the personal views of the interviewee and does not represent Wu Talks' views. Wu Talks does not endorse any tokens or projects, and readers should strictly adhere to local laws and regulations. There are significant security risks associated with on-chain tools, so readers should use them with caution.
Why is HAZE referred to as the 'idiot' in Memecoin?
Colin: Hello everyone, welcome to this episode of the podcast. This episode features a familiar friend, HAZE. He has recently gained some popularity on Twitter, and this time we are discussing a relatively light topic. HAZE, please start by explaining why you are referred to as the 'idiot indicator' in Memecoin trading?
HAZE: Hello everyone, I am HAZE, an advisor for the GMGN project. The so-called 'idiot' is actually quite simple; it’s just constantly trading shitcoins on-chain, with high volumes from both big and small investors. But I feel that to break the inherent thinking, you still have to pay tuition. If you approach Memecoin with some traditional secondary market mentality or value coin investment thinking, you will basically end up with a lot of losses. In the end, the tuition that should be paid is all paid to the on-chain, becoming liquidity for various dog coin trading groups. This is why I lost 350,000 USD. But this account was initially used for trading dog coins; it's a typical 'tuition account'. Recently, there are still ways to make money. If it’s not making money recently, then you really are an idiot, hahaha.
The origin and naming of GMGN product.
Colin: I remember when we talked before, Memecoin wasn’t very popular yet, and you had already started working on this product, right? Can you tell me about the history of this product?
HAZE: Yes, last year, because I was rather fond of focusing on new products, my entire investment thinking system was product-driven. During the DeFi period, I had a smooth investment experience. However, this year the performance of value coins has been poor. Therefore, I was looking for new narratives. Initially, I discovered the product UniBot, which solved the trading speed issue for users on the Ethereum chain, allowing them to access early costs for some projects. I felt this product addressed some of the users' urgent needs, and the business model was also good. However, after the experience, I always felt that products like TG Bot would not provide a popular user experience and feel.
So at that time, I was thinking, can we create a product with a great 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 was capable of doing this, but they asked me what the product should be named. I said, then let’s call it GMGN.
Regarding naming, I believe a good name is half the success. GMGN itself is a Crypto native thing in the on-chain community. I wanted to use some vocabulary originating from community language to name this product. I feel GMGN is a very friendly, easy to say, and simple name. When interacting with NFTs, everyone often uses greetings like GM (Good Morning) and GN (Good Night). Therefore, we hope this product provides an excellent user experience for community users and is friendly and approachable, which is why we named it GMGN. Our slogan back then was: GMGN, Degen everyday.
This is a very native slogan, hoping everyone can open GMGN every day, trade on-chain, and also make money. The product's positioning and name come from this.
Migrating from the Ethereum chain to Solana, the 'mouse warehouse' function exploded in popularity.
Colin: Since last year, how have you gradually developed?
HAZE: Actually, at that time, we initially cut into the Ethereum chain. Because I was quite confident in the Ethereum cycle. At that time, new coins like MOG and BITCOIN (HarryPotterObamaSonic10Inu) were rising. I thought, can we do this based on the Ethereum chain? But during the process, I found that there were indeed some contradictions in user sentiment, asset issuance effects, and trading speed issues on the Ethereum chain. Originally, we were pursuing quick entry and exit, high risk, and high returns, but its 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.
So in January, there was a wave of enthusiasm for Solana. At that time, I observed the trend of Solana and felt that choosing Solana was more appropriate. Compared to other chains, Solana is more mature and has existed longer. After team discussions, we decided to prioritize Solana while keeping Blast and Base as alternatives, and fully support a multi-chain model. That’s how we entered Solana. However, in March during the wave of BOME, we actually didn’t benefit much. This is because the initial layout was still centered around Ethereum and wasn’t fully deployed to Solana in time.
Later, around April and May, after GMGN went live, I promoted it on Twitter, and the feedback was that the dashboard function was quite useful. Users can continuously explore smart money addresses inside, analyze the operations of major holders, and conduct address evaluation and data analysis. During this phase, we gradually accumulated some seed users. With seed users, the updates and iterations of product demands became closer to actual user needs.
What truly made GMGN widely popular was the 'mouse warehouse' function. The inspiration for this function came from user feedback and our intuitive feelings. With such transparent on-chain asset data, we felt that we should utilize this transparency better. Therefore, we launched the mouse warehouse labeling function. For example, when rushing into a project, users are most concerned about whether there is a mouse warehouse. After adding this function, we could clearly label which projects have mouse warehouses.
In April and May of this year, after the launch of the 'mouse warehouse' function, it further promoted explosive growth on the basis of its good reputation for identifying smart money. Many users were discussing in the community how GMGN labels mouse warehouse data, such as how many mouse warehouse addresses a project has. The discussion around this rapidly increased GMGN's popularity.
The joining of more users has also made our previous smart money address function more popular. We clearly labeled the data of addresses and even matched some information from Twitter. Users can also add follow and note functions.
Many users have started writing tutorials, such as 'I found a smart money address, and this address made how much money', and then sharing how to deeply use GMGN for data mining. When this type of content was published on Twitter, the effect was unexpectedly good. As a result, more and more creators are producing content based on GMGN's functions. Whether in Chinese or English, now when searching on Twitter, many high-traffic posts are using GMGN's dashboard function. During this phase, GMGN's popularity began to truly explode.
Recently, as the Memecoin market has gradually heated up, more and more people are recommending GMGN. In the past few days, GMGN's server has been overwhelmed 6 times within 4 days.
Colin: So you mean there were days of downtime?
HAZE: Haha, right, right. The server traffic surged, and everyone had a high demand for buying and selling Memecoin with GMGN. At that time, our R&D team basically didn’t sleep and kept working overtime to scale up, but still couldn’t keep up with the users' rush. Thus, in just 4 days, the server was overwhelmed 6 times.
This is completely an unexpected situation. According to our operational experience, we had actually built some redundancy in traffic data. It can only be said that the popularity of the Memecoin market exceeded our expectations and also proved everyone's affirmation of the GMGN product. I would also like to thank all users of GMGN; it is your support that led to this result. Of course, we will continue to optimize the server.
Colin: What does the current user growth trend look like? Are there any significant growth milestones?
HAZE: The overall data can actually be queried on-chain. Data from the past half month indicates that trading volume has surged by 600%.
Colin: How is the current team size of GMGN? How many people are there?
HAZE: About 30 people.
Reviewing other platform security incidents, we will optimize our security plan.
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 emerging on Twitter. From the current information, first, it used plaintext transmission for private key transfers, which is basically a lack of any security protection. Additionally, from the revealed theft process, the funds were transferred one-to-one from the user address to the hacker's address, indicating that the server was likely hijacked. Because the private keys are in plaintext, once the server is breached, the users' private keys are fully exposed, and hackers can easily transfer the funds.
No matter the situation, safety is the top priority for custodial platforms. Products like TG Bot, where user private keys are essentially managed, equate to managing users' funds. If you do this, you need to adopt various technical measures to ensure safety, such as encrypting and storing private keys, establishing a sound internal control system, and ensuring strict isolation measures 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 identify the problem and stop 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 always placed great emphasis on safety, establishing a complete professional security team. We have experienced the waves of the internet, traded coins, and seen large capital flows, fully aware of the 'dark forest rule' in the blockchain industry. We also understand that platform security is the most fundamental guarantee.
GMGN provides two user experience modes. One is the TG Bot mode, where users' private keys are managed on the server, meeting the strategic and speed needs of advanced users. The other is that users connect to GMGN's website directly through plugin wallets like Phantom or MetaMask for trade interaction, 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 to continuously optimize our security mechanisms. Based on the recent security issues of a certain product, we will absorb lessons and fill in the gaps. We will take a more cautious approach to enhance the platform's overall security.
Future development strategy: stable service and continuous entry into hotspot narratives.
Colin: Have you ever tracked 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 clear first-mover advantage on Solana. During the wave of BOME, it captured the largest share of the dividends.
Colin: So how do you plan your subsequent 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 operational experience; third, carefully record user requests and continuously update based on the urgency of these requests. Our goal is to make users' experience smoother and smoother; that’s basically the idea.
Colin: Are you worried that the popularity of Memecoin will decrease? Or will there be issues with the long-term viability of your products once the craze passes?
HAZE: I feel that GMGN initially cut into the Memecoin track, but its essence is an on-chain product. Its positioning is about closely following on-chain hotspots and major trends to provide users with good trading opportunities and help them seize the on-chain dividends. This is GMGN's core positioning. Therefore, even if Memecoin gradually cools down or loses its current momentum, the key for us is how to determine what the next narrative hotspot is, and the team will consider how to quickly cut in.
Rather than saying we only focus on Memecoin, it is part of GMGN and currently the main part, but it is by no means the only part. I believe that in the blockchain world, hotspots switch very quickly, and innovation speeds are also rapid. Therefore, we cannot have biases or stay stagnant. We need to try more and discover more to find good entry points. If we can address users' pain points, we will cut in and execute. At the same time, we will continuously revise and adjust our understanding.
If one remains immersed in the current comfort zone and does not break it, regardless of the platform position, over time, there is a possibility of being surpassed.
Development details: 'idiot wallet', segmented tracks, 'conspiracy groups', and trading experience.
Colin: Got it, okay. Next, we have two more friends joining the discussion, one is defioasis and the other is 一一. They have in-depth observations and practical experience in the Memecoin field and can engage with you on some deeper issues.
defioasis: I have a few questions. The first is about the 'idiot wallet' indicator. Is it possible to launch a similar tool that reflects smart money inversely, such as labeling wallets with very 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 very low win rates. First, include me in that, hahaha.
Colin: I feel this idea is quite interesting, haha.
HAZE: Yes, many users who chase high often buy at high points, and then the price starts to fall. So it can serve as an indicator to assist trading decisions.
defioasis: Yes, this could be a good sell indicator. So my second question is, Memecoin is a large track with many sub-tracks, such as the recent AI Memecoin and DeSci. Is it possible to optimize the classification and sector rotation functions in GMGN so that users can see hotspots at a glance?
HAZE: The demand for sector classification has indeed been mentioned before. Some users are not trading dog coins every day; they may have heard that a particular sector is hot and want to buy a little. At this time, providing an intuitive display of market value 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 the plugin wallet. Have you tracked which of these two entry points has a higher user volume and more trading volume?
HAZE: We haven’t done such data statistics recently.
一一: I have two questions. First, the community is particularly interested in two things besides smart money: the first is discovering 'conspiracy groups', and the second is guessing who will be listed on Binance. GMGN's data analysis capabilities are very strong, especially in the smart money area. Do you have plans to further explore these associated addresses, such as labeling which addresses may be involved in conspiratorial behaviors?
HAZE: We have partially implemented this. We initially launched the mouse warehouse function and later added the 'fish' label. We will label suspected conspiracy wallets as 'red fish', and the labeling logic includes simultaneous operations on multiple wallets, consistent fund transfer behaviors, etc. For example, I recently tested an address, and the data clearly shows that it is a distribution address, labeled as 'red fish', with an additional red exclamation mark prompt.
HAZE: Additionally, we 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 we will try to avoid subjective labeling.
一一: 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 pulling up and who was making money during a certain major uptrend. Can this serve as a development direction for GMGN?
HAZE: We are currently more inclined to provide data functions that are universally applicable on large platforms. The demands you mentioned belong to customized functions that require more resource investment. Our top priority is to meet the most popular demands, but in the future, if more users raise similar needs, we will evaluate and consider adding those features.
一一: What are the key focuses for GMGN's next iteration? Will there be any other exciting features launched?
HAZE: We already have chip distribution functions, as well as wallet labeling and dispersion map functions. The future focus will still be on improving overall trading stability, speed, and experience. For example, the highly requested 'wallet monitoring' feature will expand from supporting 100 wallets to 500. Furthermore, the monitoring push needs of TG Bot and channels will also be optimized. Currently, the push function of GMGN experiences delays when the user volume is too high, and we will prioritize solving this issue.
Our goal is to help users discover information faster, be aware of dynamics quicker, and complete transactions more swiftly. The current updates mainly focus on these core needs.
