Author: YBB Capital Researcher Zeke
Foreword
On the eve of the US presidential inauguration, on the evening of January 17th local time, former President Trump announced the launch of a personal token - the TRUMP Coin through his own social media platform Truth Social. Initially, many people mistakenly thought this was the result of a hacker attack on Trump's account, but within tens of minutes, Trump used his personal account on X (formerly Twitter) to repost the promotional information about the token, officially confirming the authenticity of this news.
This was followed by a surge in price that will go down in the history of cryptocurrencies. A large amount of capital began to flow into it, and the TRUMP Coin quickly rose from zero market value to a peak of $80 billion, almost completely absorbing all the liquidity in the market. The spread of this event was no less than Trump's assassination attempt in Pennsylvania last year, and its surreal nature was no less than him dodging that bullet. I also have some simple thoughts to share on this incident.
Meme
In the Eastern country where I am located, the ultimate monetization of private domain traffic is often achieved through live-streaming e-commerce on an app called "Douyin". Across the Atlantic, the 47th President of the United States has done something unprecedented - the leader of the "world's lighthouse" is using an electronic token to measure the value of his influence and power, and accumulating a huge fortune for his family. Without a doubt, we are entering a special era, an era where Crypto can be officially called Web3.0.
The original intention of the internet was to end the monopoly of attention economics by broadcast radio and television stations, and return it to the users, but in the end, its development path has deviated from the original route. The early internet companies that controlled chat platforms and search engines in Web2.0 have already evolved into the giants we see today, such as Google and Tencent, and they have completed primitive accumulation and achieved long-term monopoly by controlling a large number of traffic entry points. Today, ByteDance almost dominates the social media in the East and West. Although it is undeniable that short video platforms have provided many opportunities for grassroots people to turn their fortunes around, this benefit is shared by most KOLs and platforms, and the platforms have absolute discourse power.
Regardless of how the form changes, the eternal theme of Web2.0 giants is the monopoly economy centered on traffic. The opportunities for ordinary people to benefit from this are very limited, and users in this feast can only constantly contribute traffic and money. Meme Coins may be a new opportunity. Admittedly, participating in Meme is very dangerous, and there are also scams, and one even needs to accept the absolutely unfair 2:8 distribution like TRUMP. But how many opportunities do ordinary people have to benefit from the traffic of the President of the United States? The process of TRUMP from 0 to 80 may be the only one.
In the past, I had to explain what Meme Coins are, but now I feel that I can explain it in a few simple words - the value of Meme is the pricing of a certain thing, a certain person, or a certain meme at a certain time, just as the market gave the initial pricing of $80 billion to former President Trump. On the other hand, Meme is also a division of the traditional internet attention economy, as people are passionate about things that can keep their eyes glued, and Meme gives users an opportunity to participate in the distribution of value in hot events.
Pump
I have mentioned a sentence in my previous articles - the best form of SocialFi is not the Dapp with predetermined rules like Friend.tech, but Pump, which is also the choice of the team behind the President. The reason is simple - people have the need to belong to a certain group, but it does not mean that they have to accept unfairness for this need. The limited ceiling and ultimate failure of Friend.tech are due to the complex gameplay around the pricing of Keys and subsequent Tokens. Looking back at past SocialFi projects, dividing people into different classes based on Token holdings to allocate empowerment and services is also the reason for their failure.
Small and exquisite will never apply to Crypto that relies on community culture, and this also applies to many other tracks outside of SocialFi, such as the NFTs that Trump has also issued. The huge supply of Meme often allows it to quickly gain a huge community, whether you hold 100U or 10WU of the token, you belong to this group.
In the past, we needed to use Twitter for promotion on social media and then guide users to Tg and DC to build a community when establishing a project. In the more distant past, like the ancient Meme Doge, you could only find the "organization" on some forums. Pump integrates the advantages of traditional social media on the basis of AMM, and returns the rule-setting to the Creator, which is the key to its success. It compresses countless fitting processes, and you can always find a sense of belonging behind the countless token icons on the Pump homepage.
Retro Trend
Regardless of how you view the personal token issued by Trump, we will enter an era where Meme becomes mainstream and various things are tokenized. In fact, this is somewhat similar to the minting power I mentioned in my article on stablecoins last year in medieval Europe, which was quite different from the unified currency system implemented in most dynasties in China. Europe has always been a patchwork, with each country, and even each nobleman and bishop, having the right to mint and issue their own currency.
Although TRUMP is not a practical currency backed by gold and silver, the fact that the President has opened this precedent means that many European and American celebrities will inevitably join this medieval retro trend. Another point worth pondering is that Trump owns 80% of the tokens. Will this token really become a pure Meme as stated on its official website - "TRUMP Memes are intended to be a way to express support and participation in the ideals and beliefs represented by the symbol '$TRUMP' and associated artworks. They are not intended to be, and should not be viewed as, any form of investment opportunity, investment contract, or security"? Or will it become an asset for monetizing power?
Among the many conspiracy theories, I am actually more inclined to believe that this is a grand beginning of the Trump family's transition from real estate to crypto, using the influence of the media, which is an ability ingrained in the DNA of this family. An absurd event can quickly create momentum, and choosing Meme as the starting point is the most appropriate, as it has both the various myths of getting rich overnight and the contrast with the high-and-mighty president. I think that the majority of the remaining tokens (according to the token release chart, perhaps three uses) if they can be airdropped to voters, donated to the US debt repayment, or used for construction, will help consolidate Trump as a cultural totem in the US and reverse the public's stereotypical impression of Crypto after the FTX incident. The family's transition from industrial capital to this nearly $100 billion IP will be a starting point.
Ethereum
Solana is undoubtedly the biggest winner in this crypto weekend, achieving a new high in SOL price and multiple times the daily trading volume of Ethereum in just two days. In comparison, the Ethereum community seems very gloomy, with the core OGs voicing increasingly loud protests against the Ethereum Foundation and the development of Layer 2.
However, looking at the skyrocketing gas fees and failed transaction volumes on Solana, crypto is still some distance away from true Mass Adoption. So on the Ethereum issue, I still maintain the same view as in the past, that the path of Layer2 advancement is just moving too fast and too far ahead. There is almost no one in the Ethereum ecosystem that can compete with Solana in terms of social heat at the base level, yes, even Base is extremely reluctant. The small-amount, high-frequency demand has been completely shifted to the second layer, but the Dapps on the second layer have not seen any breakthrough, the vast idle block space is neglected, and the gas fees are pitiful, this is the current state of Ethereum, and also the epitome of the former ETH Killers.
The paradox of public chain development is not just a triangular problem, behind the triangular problem there is also the problem of gas revenue and technical development being at odds. To use an extremely common analogy, Ethereum can be assumed to be a casino that requires tickets, which has been booming in business in the past few years, with ticket demand exceeding supply and even people constantly bidding up the price to invest in it, causing the ticket price to rise continuously. The boss realizes that the casino is indeed not big enough, not spacious enough, so he built a 100-fold casino, and in view of this scale, he lowered the admission price by 100-fold, so that a ticket in the past can be used 100 times. The result is that there are still as many customers, and the existing equipment does not need such a large venue, and the ticket price begins to languish.
This is the conflict between Ethereum's technological development and token price, coupled with the fact that Ethereum has never relied on the influence of social media, but on the moat accumulated from the ICO era to the DeFi Summer, so the problem of lack of fresh blood is constantly amplifying.
In addition to the urgent need for the foundation to undergo a revolution (on this issue I have said in the article "The King of Altcoins, Why is it Surrounded on All Sides?"), how to gain an advantage at the social level (make users more easily understand Ethereum's various abstruse technical concepts, integrate more into traditional social media), how to better feedback Layer2 (repurchase, modify DA pricing, feed back the ecology to the main chain), how to better support the development of emerging dapps (Ethereum Grant is no longer the only core focus on infrastructure projects, various L2s should have better interoperability and compatibility) in the case of stagnation at the application layer, public chain competition is often about details and differentiation.
Crypto 2.0
Trump has ushered in the 2.0 era, and the next era of crypto will also be dominated by this family, what do they want to do? Although the first project launched by the family, World Liberty Financial (WLFI), has not yet gone live, we can still get a glimpse of it from the proposal forum of the project, where the first proposal describes it as follows:
The WLFI protocol will provide liquidity for Ethereum (ETH), wrapped Bitcoin (WBTC), certain stablecoins and possibly other digital assets. WLFI will enable WLFI protocol users to access the WLFI protocol Aave instance, which will be managed through Aave's risk management system. WLFI aims to introduce a new class of users to over-collateralized lending, which is one of the most important functions of decentralized finance (DeFi). WLFI plans to attract new users to the DeFi space by providing users with a seamless experience in supplying and borrowing digital assets. Many of these users will be first-time DeFi users, which will help build brand loyalty and awareness for WLFI and Aave, helping Aave maintain a market-leading position in the digital asset lending and supply space.
Initially, the WLFI protocol will allow USDC, USDT, ETH and WBTC to be used for borrowing and lending. More assets may be added in the future through WLFI voting proposals.
WLFI will adopt the same reserve ratio system as the main Aave instance in this Aave V3 instance. AaveDAO will receive 20% of the protocol fees generated by the WLFI Aave V3 instance and will receive approximately 7% of the total circulating $WLFI tokens to participate in future WLFI governance procedures, liquidity mining and to promote the decentralization of the WLFI platform. The revenue distribution will be set up through a trustless smart contract that will direct the respective protocol fee percentages to the AaveDAO treasury and the WLFI treasury address.
Looking at the recent large-scale purchases of various project tokens, WLFI seems to be a on-chain lending institution created by Donald John Trump Jr. using his father's influence. Left foot selling WLFI tokens, right foot buying value coins (if there are major projects investing, WLFI can spiral up to the sky by stepping with both feet), directly spiraling up to the sky. In addition, WLFI is also aggressively buying various domain names, according to information posted by Cointelegraph on Twitter, WLFI has already bought daolationship.eth, yatogame.eth, WorldLiberty.eth, trumpcoin.eth, erictrump.eth, barrontrump.eth, 9290.eth. From this, it is not difficult to see that the main theme of the Trump family's future will still be around the TRUMP IP, but the track they will involve in will be quite broad, in the next four years, the Trump family's projects may exist in various public chains like the Trump Group's real estate scattered all over New York today.
The curtain is slowly falling, and an extremely special era is about to come. Whether you accept this "crypto president" or not, you must admit that the many major events that will affect Crypto in the next four years will happen across the Atlantic, and what Crypto can do is either to follow, or to have a rebirth that can make it happen all over the world.
