Author: Chen Mo, Founder of BV DAO Source: X, @cmdefi
Recently, many prominent individuals have been discussing DWF. Combined with the narrative of the current market cycle and the shift in market sentiment, some interesting viewpoints have emerged. Is the entire Crypto space becoming overly memetic and simplified, in need of a stimulant?
1. Simplification and Emotional Release
Looking at the characteristics of the current bull market cycle, aside from the institutional bull brought about by ETFs, all other areas seem to be gravitating towards “simplification” and “unmasking.” In simpler terms, this market cycle is seeking “simplicity and high volatility” to the extreme. 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, but so far in this cycle, there is no sign of a second explosion. The performance of these two previous champions in this cycle has been mediocre. There are many reasons for this phenomenon, including stagnation in innovation and a loss of user confidence. After all, many people experienced the FTX LUNA debacle, frequent security issues in DeFi, and are left with a bunch of lonely monkeys singing. Rebuilding market confidence requires fresh blood, time, and a stimulant.
This is the backdrop against which this bull market cycle was born – extremely unique and highly polarized.
Therefore, the dominance of meme coins in this cycle’s community is characterized by simplicity, emotional release, and high volatility, seizing every advantage.
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 last cycle, the results were tragic. The era where everyone blindly followed Three Arrows and Alameda is long gone. The market suddenly realized that the altar of Crypto may be even shakier than a grass stage. In such an environment, the controversial DWF emerged in this cycle, known for its aggressive tactics, seemingly playing the role of a stimulant in this unique era.
From the perspective of market makers, Crypto differs from traditional fields in several ways:
Scale: Market makers in the cryptocurrency space operate on a smaller scale compared to traditional financial markets.
Liquidity and volatility: Cryptocurrency markets have lower liquidity and higher volatility.
Regulation: Regulation in the cryptocurrency 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. Where is the Controversy?
Traditionally, the main functions of market makers are:
(1) Providing liquidity: By continuously providing depth of buying and selling, market makers ensure there is always liquidity in the market, 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, we usually consider a good market maker to have strong capital strength, provide sufficient liquidity, and make price fluctuations smoother. DWF’s style has always been known for its high volatility and aggressive trading strategies. It focuses on market making while also investing in many projects, which often leads to controversy due to its aggressive trading strategies and subsequent market manipulation accusations.
4. Giving You What You Want
In fact, DWF has emerged in a highly controversial manner – “giving you what you want” – for example, $NOT$FlOKI $LADYS, capturing the main emotions and forces of users in this cycle. In the current market environment, it has seized every advantage, even though I myself adhere to long-termism and value investing. However, doing the right thing does not mean scoffing at meme, Ponzi schemes, or any speculative assets. Value investing is not an obsession, and long-termism is not arrogance. I often see many people analyzing market trends and issues very insightfully, able to see the problems very clearly, but being able to adapt to each era is what truly makes a hero.
Looking at this unique bull market, DWF has emerged in a highly controversial manner, and its future path is unknown. But for now, it has made its mark on the market.
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