「Nowadays, rug pulling the project team is not as profitable as rug pulling the exchange.」 Arez's Rug Pulling Studio has shifted 80% of its focus to exchange platform arbitrage this year.

Before the May 1st holiday, the wildly circulated "Register on Coinbase for a 200U Airdrop" message in the group also coincidentally confirmed this shift in trend.

This cycle marks a period where rug pullers are being rug pulled in return. Most rug pulling studios with meager gains have already closed down, and most rug pulling KOLs have transitioned to other tracks, such as old rug pulling KOLs like Ice Frog transforming into "Project Rights Protection Bloggers".

Against this backdrop, BlockBeats has noticed that some studios with keener senses have already adjusted their focus: some have shifted to exchanges, precisely sniping in liquidity overflow; some have returned to traditional initial offerings, turning the Hong Kong stock market into a new ATM; and some have quietly ventured into the business of selling water and infrastructure, earning a more stable cash flow.

CEX: A New Hunting Ground in Liquidity Overflow

"Nowadays, project teams wish they could distribute all tokens among themselves," Arez said with a wry smile.

In the previous cycle, studios were accustomed to revolving around the project team—rug pulling on the testnet, rug pulling airdrops, rug pulling community activities. However, with the overall market liquidity tightening and to ensure control after listing while saving on a limited budget, project teams have generally adopted a strategy of compressing community quotas: airdrop rewards have been significantly reduced, and the proportion of tokens that retail investors can receive has continuously decreased.

The standardization and reduction of rewards for testnets and airdrops have made it increasingly difficult for ordinary rug pullers to profit. This change has directly led to the elimination of a large number of small studios, accelerating the cannibalization of the rug pulling ecosystem. Faced with the depletion of rug pulling channels from project teams, studios have had to seek new battlefields.

"In the past, doing projects was very profitable, but this cycle is different," Arez lamented, "Many project teams nowadays are actually working for exchanges and market makers. Where is there any meat left to share with outsiders?"

Exchanges still hold the largest liquidity pool and active users. Therefore, exchanges have become the new target in the eyes of rug pullers.

To drive listings, promote new products, and cultivate user habits, exchanges continue to give away money, releasing a large number of incentives. Whether it is IDO participation, trading volume rewards, or volume arbitrage, the liquidity overflow of exchanges has become a new opportunity oasis. This has also provided rug pulling studios with a new hunting ground.

Wallet IDO Participation

「Every time we participate in a Binance Wallet IDO, creating 200 accounts is no problem,」 Arez said. Calculating a profit of $30 to $50 per account, after each IDO, their team's earnings are equivalent to six months' salary for a white-collar worker in the country.

Not only Arez, Lao Zhang's studio has also found an opportunity in exploiting trading platforms.

Back in the Worldcoin era, Lao Zhang had accumulated a batch of KYC resources, and now he has smoothly transitioned into various activities on the trading platform.

Typically, studios will collaborate with KYC providers, brushing platforms, etc., forming a profit-sharing mechanism: the supply chain provides identity resources, the studio is responsible for batch operations, and in the end, they collectively distribute the rewards of airdrops or new coin arbitrage.

Take Binance Wallet's Launchpool as an example. The early stages of benefits were extremely lucrative, with nearly $100 in profit per account after each event. However, as the number of participants surged, the platform kept raising the bar: for example, wallet transaction volume within a month, introducing KYC facial recognition, restricting operation time, Alpha points, and so on.

Image Source: Bitmelon

「Initially, we mainly utilized KYC resources from Vietnam and the Philippines, which had lower costs,」 Lao Zhang recalled. But as Binance Wallet's new coin launches introduced more complex facial verification and short-term operation limits, overseas KYC resources became increasingly challenging to apply on a large scale.

「So now, we basically negotiate KYC resources ourselves and no longer rely on channel partners,」 Lao Zhang said.

Image Source: Pumpman

However, even with more flexible resource allocation, Arez also admitted that as the bar continues to rise, the oversubscription multiple hits new highs, the preparation volume and cost required to participate in a Launchpool are also increasing significantly.

「Now, it has all spiraled up, with many participants and few benefits to go around. After all, the profit from each session is decreasing,」 he said. Therefore, studios are also constantly seeking new opportunities, no longer solely relying on the path of participating in IDOs.

「We Rug Whatever the Platform Promotes」

「The reward logic of trading platforms essentially involves using money to buy data,」 Arez summarized.

Aside from participating in Initial DEX Offerings (IDO), trading platforms often introduce various trading rewards or airdrop activities to promote new products. Typically, these activities are concentrated in the early stage of a new product launch, requiring users to complete a certain amount of trading volume or deposits to receive generous and prompt rewards.

「In essence, it's very simple: wherever a platform lacks trading volume, that's where the largest incentive activities are.」 Arez told BlockBeats, explaining that they have dedicated individuals and interfaces internally monitoring the announcements of various major trading platforms, ready to quickly seize any opportunities.

To perfectly hit the jackpot, Arez spent a lot of time studying the strategic styles of various trading platforms. He likened the competitive situation of trading platforms to the period of the Warring States in ancient China.

「Each platform is like a vassal state, each with its unique characteristics and strategies. Our task is to find our opportunities in these small-scale 'wars.'」 Arez said with a smile, giving an example that is often mentioned within the team: 「During the reforms of Shang Yang, there was a strategy of reward and punishment. Initially, a reward of ten gold was offered to whoever could carry a wooden log to the North Gate; since no one volunteered, the reward was continually increased until it reached fifty gold. Eventually, someone took up the challenge and received the reward.」

In his view, Coinbase recently made a bold move by launching a 200U registration airdrop to support its futures trading section and address its long-standing weaknesses. Bybit heavily promoted its payment card feature and introduced a series of cashback activities. Additionally, Gate introduced some new meme features... 「The principle is the same, essentially similar to the situation where today the State of Qin rewards with ten gold for a reform and tomorrow the State of Zhao rewards with five gold for another reform.」

「My goal is to be the first one to carry the wooden log.」 Arez said. In the latest round of competition among trading platforms, he prefers to be the first to try new things and enjoy the benefits first: 「Rug whatever the platform promotes and feast along with the platform.」

While airdrops from projects have become a black box game, trading platforms have become the main players in the new era of 「money scattering」: from Binance Launchpool's IDOs to Coinbase's lucrative futures competitions, and Bybit's payment card traffic battles, the keen-smelling studios have already pivoted. In the overflow of liquidity from these trading platforms, the keen-smelling studios have once again found their way to survive.

One Fish, Multiple Earnings: Low-Risk Arbitrage + Airdrop Farming

In addition to participating in events and IDO allocations, some more specialized studios have already explored a dual-income model of arbitrage and airdrop farming on trading platforms. The Backpack trading platform is a typical example.

It is also highly recommended to read Cookie's interview article released last week titled "Backpack+AI, Even Code Newbies Can Script Low-Risk Profit." The article interviewed a pro player CJ who does arbitrage scripting on the Backpack platform, sharing many practical tips and insights that can be directly applied:

For example, overlaying multiple strategies, such as spot buying SOL, shorting SOL in the futures market, then bridging the spot to on-chain participation in liquidity pools (LP Farming) to earn fees, while also stacking expectations of airdrops from different platforms, achieving one fish, multiple earnings; and using an AI assistant (such as Cursor) to continuously adjust and optimize logic through dialogue, ultimately building an automated trading and interactive script system, significantly enhancing the efficiency of arbitrage and airdrop farming.

On trading platforms with liquidity spillover, engaging in arbitrage trading while also airdrop farming has become an important weapon for the new generation of studios. Especially on platforms like Backpack that have both token issuance expectations and support for multi-strategy arbitrage, it has become a battleground for airdrop farming studios.

Hong Kong Stock Market "Mini Spring," Studios Returning to Their Roots

In addition to seeking opportunities for liquidity spillover on trading platforms, some faster-reacting airdrop farming studios have also turned their attention to Hong Kong IPOs.

"Since it's difficult to earn in the crypto circle, why not go to the traditional market to find meat to eat." Arez told Lüdong BlockBeats that their studio has specifically set up a Hong Kong IPO group this year, dedicated to applying for Hong Kong IPO projects. Since the second half of 2024, the performance of Hong Kong IPOs has been exceptionally bright, ushering in a "mini spring" market, becoming a new source of cash flow for many airdrop farming studios.

Among these new stocks, the performance of Miniso and Momojein has been particularly outstanding: Miniso soared over 47% on its first day of trading, earning nearly HK$10,000 net profit per hand. Momojein, as a well-known high-end beauty brand, saw an almost 58% increase on its first day of trading, with an individual account requiring only HK$2,880 in initial capital to apply for 10 lots, ultimately yielding over HK$16,000 per account.

「When it comes to Hong Kong IPO subscriptions, I focus on several key points: strong fundamentals, high market demand, blue-chip stocks, low issuance valuation, and high subscription rate. The success rate can be above 70%.」 Arez indicated that their current success rate and certainty in Hong Kong IPO subscriptions far exceed those in the cryptocurrency market.

In the cryptocurrency market, the airdrop standards set by project teams have become completely opaque, with most projects no longer disclosing any criteria. Some even directly manipulate the airdrop lists in the background: increasing the proportion of reserved addresses, privatizing the standards and scoring system, rendering it nearly impossible for ordinary participants to anticipate anything, and drastically reducing the success rate of those who used to 'have a share of the pie' behind the scenes of the project. Additionally, some resource-based studios, leveraging private relationships with project teams, receive a direct allocation of airdrop standards from the projects. The studios produce interactive addresses in bulk as agreed upon to ensure compliance with interaction data, and after the airdrop distribution, they split the rewards proportionally. However, this opportunity is clearly limited to a few players with resources and connections, leaving most ordinary studios out in the cold.

Compared to this, Hong Kong IPO subscriptions seem to be purely straightforward.

Meanwhile, similar to the competition between cryptocurrency exchanges, securities brokers in Hong Kong are aggressively attracting new clients: brokers like Bright Smart, China Everbright, Tiger Brokers, etc., are offering "zero commission" promotions, along with stock bonuses for transferring accounts. Some brokers are giving away 100 shares of Tencent Holdings, while others are offering Buffett's heavily-weighted stock, Occidental Petroleum.

Consequently, the leverage provided by brokers for IPO subscriptions has increased. "In the past, brokers provided 10x leverage, with a few offering 20x or 30x, but starting from the second half of last year, brokers have been offering 50x or even 100x leverage," Arez stated.

（Note: 10x leverage refers to reducing the IPO subscription cost per account to 1/10 of the original amount）

Selling "Water," Renting Servers, and Making Money off Scalpers

Where there are plenty of scalpers, there is a business opportunity to capitalize on.

As project teams have become increasingly stringent in verifying IP sources and interaction environments, the rampant use of IP addresses (commonly known as shared IP addresses) for scalping is no longer practical. Mainland China IPs are frequently blocked by project teams, making overseas IPs a mandatory requirement for some project interactions. Multiple account operations necessitate numerous independent IPs to avoid related account bans. Node-based and auto-browsing projects (such as Nillion, Grass, etc.) have stringent requirements for server stability and IP cleanliness.

Subsequently, professional server and IP providers have emerged to meet this demand.

A typical server IP provider's service process includes: Providing overseas cloud servers (such as ByteDance's Volcano Engine, AWS, Hetzner, Tencent Cloud International, etc.); Configuring stable dedicated IP; Pre-installing the basic environment required for interaction (system, wallet, scripts, toolkit, etc.); Some high-end services even provide customized solutions such as node optimization, traffic distribution, script deployment, etc.

Byteplus.Pro is doing this kind of business, and ever since the Grass project, Byteplus.Pro founder Miko noticed this small trend, starting the Web3 business with Web2 traditional servers, IPs, GPU resources.

"We are the Web3 infrastructure builders," Miko explained, "backed by resources from companies like ByteDance and Tencent Cloud. We are their overseas agents, and we even have the official node route for TikTok live broadcasts."

For the rug pull studio, instead of building a cumbersome environment themselves, it is better to directly purchase a complete set of services, saving time and improving success rates. "We are like the electricity and water in the rug pull track, any industry and track need infrastructure service providers like us to operate," as founder Miko put it.

The business minds in this track have actually also "gone deep into the sinking", "selling water" (test coins) is also a direct manifestation.

In the past, test coins were mainly distributed for free by the project team for user testing. But today, this process has become highly commercialized and standardized, with the water selling industry basically being taken over by mature products.

For example, service providers like gasdotzip and memebridgeb can now provide one-stop services for purchasing test coins, cross-chain bridge transfers, etc., with mature operations and a complete system.

In addition to these mature "water selling" products, when searching for popular rug pull projects on Twitter, one can always see some individual "water selling" tweets, and such messages are also often seen in various WeChat groups. Test coins were supposed to be part of on-chain testing, but sometimes we can already find it difficult to distinguish between the mainnet and testnet.

The most typical example is the Monad. Although the mainnet has not yet launched, there are already numerous NFT assets on the testnet. These assets are being traded extensively on Magic Eden, and they appear almost indistinguishable from real mainnet assets.

The test coin that gives off a "worthless" first impression is actually an arbitrage opportunity. Opportunities in the crypto world are truly everywhere.

This is a new cycle, a new hunting ground, and new survival rules.

The world of crypto trading has never lacked clever individuals. The real difference lies not in whether the environment is good or bad, but in who can undergo self-transformation most rapidly in the face of change.

In this round of market changes, project teams have tightened airdrops, liquidity has shifted to trading platforms, and traditional arbitrage paths have been continuously squeezed. The era where one could easily profit from airdrops by burning gas and engaging in interactions is long gone. In the new cycle, those who truly survive are not necessarily the fastest runners but those who can see the situation clearly and proactively adapt.

After all, in the crypto world, survival and evolution have always been top-tier abilities.

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