Back to January 17, there were only two days left before the new pro-cryptocurrency president of the United States took office.
On this day, without any warning, Trump suddenly announced the launch of a cryptocurrency MEME coin called $TRUMP on his social platform Truth Social.
At a speed measured in seconds, $TRUMP ignited the start of the crypto market in 2025 and became the most powerful celebrity coin in history. Within 24 hours of its launch, it was green-lit and quickly listed on top trading platforms such as Coinbase and Binance, and its 24-hour trading volume exceeded $10 billion, more than three times the 24-hour trading volume of Bitcoin.
In addition to the conspiracy group, the 24-hour online cryptocurrency trading pioneers were the first to make money on $TRUMP. Even amid various suspicions that Trumps official account must have been hacked, a group of people represented by 0x sun took quick action and bought in early with the on-chain data monitoring capabilities accumulated over the years. Around the 10th minute after $TRUMP was issued, 0x Sun started buying, and bought $600,000 in half an hour, with an average cost of only $0.6, and a profit of more than $27.5 million, becoming a god in one battle.
But the problem is that the MEME coin market is a typical zero-sum market, with no support from technological innovation, no fundamentals, and no value creation. There is only a difference between buying early and late, so not everyone can be as lucky as 0xsun. As the popularity declines, and the issuance of Trumps wife coin is a disguised increase in the issuance of $TRUMP, the price of $TRUMP has fallen from a high of $72 and is currently maintained at around $17.
According to early statistics, the data of profitable addresses showed an obvious normal distribution, with 560,000 addresses still losing money and only 300,000 making profits.
Data source: DunePHD
Even if you keep your son, you cant escape the trap
The market is not always so friendly to everyone. KOHA is an example. He is one of the 560,000 people who are stuck.
KOHA is a PhD student in science and engineering in Canada. He occasionally invests in U.S. stocks. In 2024, he bought Trumps company DJT in advance because he bet that Trump would be elected president, and he eventually made a small profit. This success gave him confidence in Trumps business model and made him mistakenly believe that $TRUMP coin would have long-term value like DJT stock.
However, the market pace of the cryptocurrency world is much faster than that of the U.S. stock market.
When $TRUMP was issued, it was Saturday morning in Beijing time, but it was late Friday night in the US and Canadian time zones. Like many locals who were resting, KOHA did not pay attention to this event at the first time. When he learned about the issuance of $TRUMP, it was already the next day for KOHA.
Because Trump often makes unfriendly policy adjustments to the overseas study community, and Canada and the United States have a close relationship, KOHA is lucky to be in an environment where people are paying close attention to Trumps behavior. The next day, when KOHA learned about Trumps coin issuance in the overseas study group, $TRUMP had already risen from its initial price to $28.
He took immediate action and tried to buy $TRUMP through the Moonshot platform, but due to identity verification, KYC operations such as uploading drivers license, and learning how to buy, it took some time. When he finally succeeded in buying, the price had risen to $30. Despite this, he decided to enter the market with almost no hesitation.
This four-year term has just begun. Trumps current regime is a very centralized one. The US president can only serve two terms, so it is generally recognized that the second term is for making money and doing business. People all over the world want to do business with him. In the future, whoever wants to do business with him, $TRUMP is a way and a threshold. KOHAs logic is very simple.
In KOHAs view, the more people want to establish contact with Trump through this channel, the higher the price of Trumpcoin will be. This plate is obviously much easier to manipulate than DJT. There is no need to report to the SEC for sales. The total supply is 1 billion, and only 200 million are in circulation, and 80% of the tokens are still in my hands. I immediately sold all DJT and bought $TRUMP coins.
KOHA is not the only investor who believes that Trump’s business model can be replicated in the crypto market. In fact, many people believe that Trump’s $TRUMP issuance is part of his financial strategy.
Trump cant squeeze in, he cant integrate, and its impossible for him to integrate. His feud with his youngest daughter Ivanka is actually a feud between two factions in financial ideology. The feud between capitals cannot even be integrated by blood. KOHA analyzed. In his view, the traditional financial market is controlled by Jewish capital from Wall Street and the Democratic Party. Trump will never be able to integrate into this system. His only way out is to take a different approach and use the decentralized nature of virtual currency to establish his own financial order.
KOHAs understanding of the crypto industry is an unexpected beneficiary of two capital conflicts. Trump has indeed shown a friendly attitude in policy: relaxing cryptocurrency regulation to provide a freer trading environment for the market; Bitcoin broke through $75,000, and the entire crypto market ushered in a bull market carnival; Republican lawmakers promoted the establishment of a strategic reserve of Bitcoin to further enhance market confidence. All these factors gave KOHA a grand investment narrative, making him believe that $TRUMP is a long-term asset.
When KOHA found that $TRUMP was always rising, he added more positions at $40, but by Monday, two days later, $TRUMP had entered the profit-taking stage from the FOMO (fear of missing out) stage. Market liquidity declined, buy orders decreased, and the coins in KOHAs hands gradually became locked liquidity, with an average price of $36.
This cycle is a clear bet
Li Yi was also trapped like KOHA.
However, unlike KOHA, who had no experience in the cryptocurrency world and didn’t even know which major cryptocurrency trading platforms there were, Li Yi had been in this market for a while. Compared to newcomers who were not even familiar with trading platforms, Li Yi at least knew where to trade, and knew that the logic of the cryptocurrency world was not important, and emotions were the only determining factor. Li Yi mixed in multiple cryptocurrency exchange groups, kept an eye on market trends, and followed the buying and selling of some traders who called themselves “old guns in the cryptocurrency world.”
He did make a killing.
In the early days of $TRUMP, he sold at a low of $17 with the strategy of If you dont have the wisdom, you have to follow the trend, and sold it smoothly after the price soared, making a profit. However, after making money, he became a little overconfident.
After making money, Li Yi did not choose to leave, but started looking for the next $TRUMP.
Sure enough, the Trump family did not disappoint Li Yi. Two days after the Trump coin was issued, Trumps wife coin Melania coin ($MELANIA) was issued. At the same time, the concept of family coin began to become popular in the coin exchange group.
Although it did not receive official support, the name of Trumps youngest son Barron was used by the community under the banner of Trump Family. Against the backdrop of the surge in $TRUMP prices, it was touted as the future presidential coin. There were even rumors that even Trumps nanny had issued coins, which quickly attracted a group of funds to enter the market. Li Yi was one of them.
He naively believed that the logic of these coins was the same as $TRUMP and that they could also rise like $TRUMP. So he invested most of his profits into Wife Coin and Son Coin.
But the market did not give him a second chance.
The rest of the family coins quickly returned to zero, Li Yis principal was locked up, and his profits evaporated instantly. At present, he began to ask around how to buy World Liberty Financial (WLFI, the Trump familys decentralized financial project), trying to make a comeback with new speculative projects. One more gamble, WLFI may be able to continue the orthodoxy of Trump Coin, Li Yi said.
The biggest change in this cycle is that everyone has revealed their cards.
There is no need for packaging, no need to pretend to be a technologically innovative project, and no need to spend $5,000 to hire someone to write a high-sounding English white paper and pile up a bunch of obscure new concepts.
The way to play this round of bull market is simple and crude - directly hyping emotions, celebrities, topics, and cognitive differences. Using FOMO emotions, a series of new altcoins are created, and the fantasy of new leeks is used to harvest.
In the past, new chain project factories would do a little work to disguise themselves as seemingly innovative projects. Looking back at the early days of the launch of BSC, Aptos, and Arbitrum new chains, the market experienced the same scene - a bunch of anonymous innovation project factories swarmed in, using the new chain effect to harvest TVL and users, and when the market heat subsided, they simply shut down the community and website, took away the funds and disappeared without a trace.
Behind these projects are often a group of familiar faces, who have become new popular currencies by simply changing their names and modifying a few codes. They were initially the first batch of popular projects on a new public chain, anonymous and mysterious, without the support of well-known investors or audits by large companies, but they are always touted by KOLs, relying on the FOMO sentiment of the community to create wave after wave of wealth myths.
But now, the market seems to have reached another consensus: this is a new gambling game, a wealth transfer game.
No one talks about technological revolution or changing the world anymore. Everyone knows that if you lose this round, you can wait for the next one. If you are willing to accept the loss, then come. The cryptocurrency circle is meant for this. It is said that the guys in Hangzhou nightclubs all know how to short altcoins.
And Li Yi is just another participant in this wealth transfer game.
Are those who short sell the winners?
Among the newcomers in the cryptocurrency circle who entered the circle through Trump Coin and were interviewed this time, only Professor L made money and left in the end.
In the storm of $TRUMP coin, most people are betting on the rise, desperately rushing higher, and end up being trapped at the high point. However, some people choose the opposite direction - short selling, and successfully make profits against the trend in the market frenzy.
Professor L, a finance professor and a senior futures trader, has been studying market structure for a long time and knows that the price fluctuations of cryptocurrencies are far more drastic than those of traditional financial markets. As a MEME coin, $TRUMP has no fundamental support and is completely dependent on market sentiment, which means that it is likely to plummet after a short-term surge.
However, his trading strategy is not simply betting on a market decline, but a basic hedging hedging strategy in futures trading:
He used $50,000 to buy spot to ensure that he would not miss the rising profits. At the same time, he used $10,000 to short $TRUMP contracts 5 times as a risk hedge. If $TRUMP continues to rise, his spot profits can cover the losses of the contracts. If $TRUMP plummets, his short orders can make up for the losses and even bring excess returns.
Professor L does not agree with the gambling-style leveraged trading of many retail investors. The essence of a contract is to spread risk, not to amplify returns. But most people do not understand this.
At the same time, Professor L strongly agrees with Peter Lynch’s point of view: Big short-selling funds will not short-sell at the highest point, but after the market has been cut in half, when retail investors say that the decline can no longer continue and start to buy at the bottom, short-selling funds like to short-sell at such a position. This is exactly the reason why Professor L chose not to close his short position in the rapid decline of $TRUMP after its crazy rise.
In cryptocurrency trading groups, there are always people who brag about their high leverage records: Today I opened a short order with 50x leverage and made $2,000!, Yesterdays long order was liquidated, and today I made money back on the short order! But the fact is that this strategy is ultimately gambling.
Professor Ls success is in stark contrast to those retail investors who blindly open high leverage and gamble on fate. The violent fluctuations of the market, coupled with high leverage, only need one reverse market trend to instantly return the account to zero. Many retail investors opened multiple leverages crazily when $TRUMP was at its peak, fantasizing that the price would continue to soar, but were killed by the market and their positions were directly liquidated.
In the end, when the price of $TRUMP fell back from its high point, Professor Ls hedging strategy allowed him to make stable profits. He did not rely on the speed to reap the dividends like 0x Sun, nor was he pitted under the FOMO emotion like Li Yi. Instead, he relied on rational risk management to survive the extreme market conditions in the cryptocurrency circle and make stable profits.
How many pitfalls do newcomers have to face when entering the cryptocurrency circle?
In this round of Trump coin craze, it is not just the inexperienced newbies who enter the market, but also many veteran players from the traditional investment market. They have experienced various capital games in the A-share, commodity futures, and even tea speculation markets.
Professor L is lucky, but not all veterans can rely on past experience to replicate their past success in the cryptocurrency world. In other words, they have to step on many pitfalls before they officially start trading.
A-share bulls are short and bears are long, and speculating on small and bad stocks is the way to survive. This is the consensus of many domestic stock investors, including Su Bing Ge. For a long time, the speculative style of A-shares has made him accustomed to short-term swing operations, picking up stocks at low prices, and gaming market sentiment.
When Brother Su Bing saw $TRUMP, a currency with a strong hype concept, he immediately had a familiar feeling - Isnt this just a small-cap stock with a high degree of control? So he decided to give it a try.
Brother Su Bing, who bought more than 4,000 RMB of $TRUMP at a high price of $69, tried to calculate the possibility of getting his money back. As the price of the coin continued to fall, during the interview with BlockBeats, the price of $TRUMP was $26 per coin, which means that if it rises by 5%, he needs to cover his position by 50,000 RMB to bring down the cost price. But he also knows that this is just a leek fantasy.
After being trapped, Brother Su Bing discovered that the rules of the game in the cryptocurrency circle are far more cruel than those in the A-share market: There are no price limits, and there are no rules to follow for the inflow and outflow of funds. The banker can wash the market in an instant. There is no supervision, and market makers can drain liquidity at any time and control the market at will. There is no time window, 24-hour trading, and the market never stops. Retail investors have no chance to breathe at all. Brother Su Bing was a little emotional and wanted to complain for three days and three nights.
Many investors who were accustomed to the short-term strategy of A-shares not only failed to make money in $TRUMP, but also lost their principal due to repeated entry and exit attempts at swing trading.
But the cryptocurrency world is a place where people are eaten without leaving any bones. After overcoming the incompatibility between traditional stock trading and cryptocurrency trading, Brother Su Bing found that he had stepped into another pit.
After I felt there was no hope of making back my investment, I was ready to sell at a loss, only to discover that the coins I bought were fake. Before the spot coins were listed on the trading platform, Brother Su Bing followed the operations of the big brothers in the trading group and bought the first batch of $TRUMP using the web3 wallet of a certain trading platform.
Because he had never used a web3 wallet before, he had been looking at everyones quotes in the group. He did not take the initiative to look at it again after buying. It was not until he was ready to sell that he discovered that his money did not flow into the real market at all, but was swallowed up by the fake currency contract deployed by hackers.
And this is still a relatively simple way to reap profits in the cryptocurrency circle. There will be more traps waiting for Brother Su Bing after this.
The mixed quality of paid cryptocurrency exchange groups is like boiling a frog in warm water. At the beginning, it was free, using beautiful photos of female bloggers, screenshots of making money, or photos of picking up cars and buying houses to attract traffic. The big brothers in it would enthusiastically teach novices how to open an account on the trading platform and how to trade. At this step, the big brothers could receive a tuition fee through the rebate of the trading platform.
Using retail investors’ funds to buy orders and pay commissions is still considered good, but the most direct way is to take orders and cut leeks. They claim to have “accurate insider information”, but in fact, they are all designed harvesting schemes. The most common scam on Xiaohongshu is the so-called “quantitative robot trading strategy”, which claims to be able to achieve a monthly return of 30%.
The cryptocurrency world is a completely different world. The game here is a high-frequency confrontation in seconds, and every second missed may mean a huge loss. Whats worse is that many old players, relying on their strong funds, often adopt the strategy of big money bets, but end up becoming the target of the top of the market. The big dealers who control the market have been prepared long before they enter the market, waiting for these big fish to take the bait and quickly absorb their funds.
In this PVP duel without gun smoke, the flow of funds and the control of the market are always in the hands of a few people. For those players who still stay in the traditional market thinking, the rules of the cryptocurrency circle often catch them off guard. Because here, risks and opportunities coexist, but there are more risks.
When these old players came to their senses, they found that not only did they not make a fortune in the cryptocurrency circle through years of experience, but they became the typical example of being harvested as soon as they entered the market. Those rules of experience that they were used to became useless in this brand new market.
And these are the tuition fees they must pay when entering this industry.
