The Golden Trinity of Meme Coin Launches
With the recent buzz surrounding meme coins, behind-the-scenes operations, and whale investors, I’ve decided to provide some background information. Every token project that is directly launched on decentralized exchanges (DEX) without venture capital (VC) support has three essential elements:
1. Development Team
2. Snipers
3. Whales (TBD)
The complexity and overlap of these three elements vary from token to token, but a successful long-term trajectory requires a well-balanced combination of all three.
Development Team
Every development team must strike a delicate balance between decentralization and organization. On platforms like pump.fun, the development team may consist of just one person with a title. Conversely, teams like $BONK are highly organized, composed of some of the smartest active crypto traders on Solana. Both types of teams can perform exceptionally well, but their success ultimately depends on the other two factors (snipers and whales).
Organized teams have the advantage of typically allocating budgets for marketing and future development, giving their tokens more “utility” compared to memes that solely originate from pump.fun. A prime example is bonkbot, as no other fully decentralized meme possesses a product of this caliber due to insufficient funding. Another example is $MEW, which is capable of airdropping a significant number of tokens to all $BONK and $WIF holders. These teams also have easier access to liquidity providers and can quickly list their tokens on exchanges.
On the other hand, fully decentralized teams often start with lower market caps since they lack initial support from deep-pocketed investors. These teams often form passionate communities in the early stages through minimal upfront costs and widespread token distribution. The best examples are $WIF and $MICHI, tokens that had extremely low market values upon launch but boasted highly active communities. The risk with these coins is that, on average, they are more likely to fail early on as snipers attempt to exit rapidly without the backing of whales or teams with long-term interests in the project.
Snipers
Frankly, I’m not the best person to delve into this topic in detail as I don’t partake in early launch sniping, but I do know a few people who do. For snipers, they typically don’t care about the project itself; they simply want to get in first and exit if there’s sufficient liquidity, often immediately. Many projects without well-organized teams fail due to snipers buying up a large number of tokens at launch and promptly dumping them, causing chaotic price charts.
A notable example is the ETHWIF derivatives launched a few months ago. Many wallets purchased them immediately upon launch and sold within a few hours, generating six-figure profits.
90% of newly issued tokens on decentralized exchanges (DEX) will not exceed a market cap of $5 million. This is primarily due to most of these development teams being anonymous and eager to make quick profits. This is also why the concept of “CTO” (community takeover) is so popular because development teams often immediately sell their tokens.
Whales
Every token that grows from zero to billions eventually requires whales to drive the price upward. For memes, communities typically form in the early stages. Once memes reach sufficient attention and viral spread, their market cap surpasses $100 million. Once they establish a market cap above $100 million, you’ll start seeing larger players entering the scene as there’s now enough liquidity to build large-scale positions. Simultaneously, early participants of these memes must hold steadfast and not sell. Once they become whales, their long-term success is crucial to the project.
In summary, every token project has a team, varying in organizational structure. Each token has snipers and whales, and a well-balanced combination of these factors is necessary to achieve a market cap in the billions, regardless of whether they are the same participants or different ones.
Original article source:
深潮