Source: Waterdrip
Who is making money in this bull market so far?
First of all, it’s definitely not the VCs. Most of the projects funded by VCs haven’t even started issuing tokens yet. Even those coins with high FDV and low circulation that have been criticized by the community may look impressive on paper, but if a copycat bull market doesn’t arrive soon, they could easily drop by 90% when the VCs unlock their tokens.
Secondly, it’s not the retail investors either. Most retail investors are busy trading memes, playing with altcoins, engaging in contracts – some may have made money, but it’s a small minority, with odds similar to playing the lottery.
From observation, those making money fall into these categories:
1. Bitcoin holders. Holding Bitcoin means the world works for you. Last year it was at 25,000, now it’s at 65,000 – a huge profit. It’s almost certain to reach 100,000 within a year, but most people overlook this increase and therefore miss out on making money with BTC, which is understandable.
2. Centralized exchanges. Exchanges have always been at the top of the crypto food chain, with the entire industry essentially working for them. Of course, operating an exchange comes with significant risks, including constant relocation, overseas operations, and regulatory challenges. The risks and rewards are directly proportional, which is reasonable.
3. CeFi platforms like Tether. In the first quarter alone, Tether made $4.7 billion, more than most exchanges. Strictly speaking, this money wasn’t earned from the crypto industry. Additionally, some financial service providers in the crypto space are quietly making profits, such as asset management platforms. They provide valuable services to the crypto industry, earning money in a reasonable manner.
4. Operations teams of some public chains/DeFi products. DeFi products like Uniswap have high traffic, and the transaction fees go directly to the team, not the token holders. This income can be substantial. The Base team may earn millions of dollars in transaction fees from a single product like Friendtech. The Tron public chain profits greatly from daily USDT transfers, most of which go to the team. These projects don’t rely on hyping up retail investors to sell tokens, but rather focus on developing business to make money – similar to traditional internet businesses. They represent hope for the crypto industry, and all projects should learn from them. Especially notable is MakerDAO’s example, as well as Uni preparing proposals for dividends – these are the alphas of this bull market.
5. Coin projects with high market value whose main goal is to sell coins. If they have already been listed on CEX, they have likely made a substantial profit this round. They don’t need additional revenue – for example, some ZK projects only have a few users left after airdrops, yet their market value remains in the tens to hundreds of billions, with market makers happily helping the team sell tokens. Similarly, high-holding DeFi coins, studio-operated GameFi coins with few active participants, fall into a similar category. These cancers of the crypto industry continuously drain resources. The teams behind these cancers are also accomplices in making money. It’s ridiculous to see people boasting on Twitter about how much money they’ve made from manipulating projects – a phenomenon unique to the crypto industry.
There are also quant teams, among others, who earn money through hard work but aren’t listed individually. If anyone has more discoveries, feel free to reply in the comments and let me admire them.
However, based on the analysis above, it might be worth considering creating a crypto portfolio that consistently earns money, focusing on assets from categories 1-4 while avoiding category 5.