If You Shout Loudly About Token Unlocks, the Buyer Definitely Won’t Come
Why did financial nihilism lead to retail focusing on meme coins in 2024?
Because voices on Twitter are getting louder about the pressure “promising” tokens will face in 2024 due to investor unlocks.
Here are three deals I made in 2024 based on this:
Arbitrum — I sold all my airdrop and purchased tokens at $1–1.15 for $2.1 the day before the unlocks (April 16), despite the buzz about a bullish unlock of 50% of the supply. Three months later, the token trades near its all-time low (-65%), and buyers aren’t lining up because on July 16, another $74M (92.65M tokens) will be unlocked for investors and the team.
Worldcoin — I raised concerns about Wintermute’s dirty play back in late February 2024 when the token was trading at $8–10 (80–100B FDV). I shorted it at $8–12, faced ridicule for shorting such an advanced coin, and now it turns out that this proxy token tied to Sam Altman from OpenAI will face daily pressure of 6.62M tokens ($16M at current prices) for 730 days. Don’t forget that creditors include FTX and 3AC, who will be the first to hit the sell button. The February/March short squeeze at $8–12 was also due to the team pausing grant payouts for 3 weeks under the guise of network updates, removing $200M+ pressure from the market. They’ll likely do something similar on July 23 to pump the token before unlocks. I regret closing my short at $4 (the token is now 40% lower).
IO Net — I shorted at $5–5.5 based on announced payouts for mining capacities, adding $3–5M monthly emission pressure. Given the performance of all the junk launched on Binance Launchpads in 2024, it’s no surprise the token is already trading near $3.
I also shorted LayerZero at $4.8, but was forced to close on Hyperliquid settlement, and futures on Binance came 25% lower ($3.8), changing the short’s risk/reward ratio.
The recent LayerZero pump is due to Twitter pushing the idea of incorrect circulating supply on Coingecko. Market participants thought the circulating supply was 250M ($800M market cap), but it was actually 80M ($250M market cap). This reevaluation raised the token from $2.4 to $4, closer to my short targets. Even the project founder secretly coded the token’s price target in its name ($ZRO to zero).
This leads to the understanding of why retail is so drawn to trading meme coins.
Tokens like $popcat, $mog, $mew, $wif, $pepe have no hint of technology, but they also involve fraud and secret token allocations to the team, shillers, and insiders.
However, these tokens carry a crypto-punk ethos — we have no intrinsic value, nanotechnology, zk compressors, or other nonsense VCs use to justify why you should buy the token while they dump $16M daily for 730 days (hello $wld).
Meme coins need hype, and how well their mascot integrates into culture, how fresh and applicable it is.
I recently came across an interesting phrase distinguishing NFTs from meme coins:
“In NFTs, you need 10,000 like-minded people to promote different images with similar themes. In meme coins, you can have millions of supporters pushing one coin.”
Welcome to the future where the ideal portfolio might be BTC, ETH, SOL, and a handful of meme coins that will outperform hundreds of tech coins with multi-million-dollar unlocks in the near future.
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