Recently, many influencers have been discussing DWF in the context of the current market cycle and changing market sentiment. It’s been observed that the entire Crypto market is becoming more meme-driven and simplified from top to bottom. Is there a need for a stimulant to inject some excitement?
1. Simplification and Emotional Outbursts
Looking at the characteristics of the current bull market cycle, aside from the institutional bull run brought about by ETFs, other areas are moving towards “simplification” and “de-masking.” In simple terms, this bull market is striving for simplicity and high volatility. Specifically:
DeFi has been labeled as overly complex, with the notion that the more complex it is, the easier it is to lose money.
NFTs were once the pinnacle of storytelling and hype, yet in this cycle, there is no sign of a second explosion.
Both of these previous champions are performing mediocrely in this cycle for various reasons, including innovation stagnation and loss of user confidence. After experiencing FTX LUNA’s collapse and frequent DeFi security issues, market participants are left with a sense of uncertainty. Rebuilding market confidence requires fresh blood, time, and a stimulant.
This sets the stage for this unique bull market cycle, which is extremely distinctive and highly polarized. Hence, the community-led nature of meme coins in this cycle is simplistic, emotionally cathartic, and highly volatile, taking full advantage of the current zeitgeist.
2. Market Makers and Polarization
On the other hand, speaking of market makers, after various “elite” market makers experienced events like FTX and LUNA in the previous cycle, the results were quite tragic. The era where everyone blindly followed Three Arrows and Alameda has passed, revealing that the crypto industry’s elite may be even more volatile than grass-roots teams. In this environment, the controversial DWF has emerged in this cycle, playing the role of a stimulant in this unique era.
From the perspective of market makers, there are differences between Crypto and traditional fields:
Scale: Compared to traditional financial markets, the operation scale of cryptocurrency market makers is smaller.
Liquidity and volatility: The liquidity in the crypto market is lower, and volatility is higher.
Regulation: Regulation in the crypto market is not perfect, and the relationships between exchanges, project teams, and market makers are complex.
Technology: Some market makers may involve blockchain or DeFi financial strategies, requiring sufficient technical support to ensure the security of their trading execution.
3. Points of Contention
Traditionally, the main functions of market makers are:
(1) Providing liquidity: Ensuring there is always liquidity in the market by continuously providing depth for buying and selling, allowing investors to buy or sell at any time.
(2) Price fluctuation and discovery: Market makers adjust bids and quotes to smooth market price fluctuations and guide price discovery.
(3) Improving market efficiency: By quickly matching trades, market makers can reduce trade delays and improve market efficiency.
Therefore, a good market maker is typically one with strong capital strength that can provide sufficient liquidity while smoothing price fluctuations. DWF, known for its highly volatile nature, focuses on market making but also invests in many projects. Its aggressive trading strategies often spark controversy and accusations of market manipulation.
4. Giving You What You Want
In reality, DWF has emerged in a highly controversial manner – “giving you what you want,” capturing the main emotions and forces of users in this market cycle. In the current market environment, it has taken advantage of the timing and circumstances, even though I myself adhere to long-termism and value investing. Doing the right thing does not mean dismissing things like memes, Ponzi schemes, or speculative assets. Value investing is not about fixation, and long-termism is not about being aloof. Many people have a deep understanding of market conditions and issues, which is commendable, but being able to adapt to each era is what truly defines a hero.
Looking at this unique bull market, DWF has emerged controversially, and its future path remains uncertain. However, it has certainly left a lasting impression on the market participants.
