Interview: Joyce, Jack, BlockBeats

Compiled by: Joyce, BlockBeats

In this round of bull market, the meme market has always been the center of controversy in the crypto community. Some people think that the popularity of memes is a manifestation of the crypto industry's "de-packaging, removing the false and retaining the true", while others have a negative attitude towards the endless PVP mode and bluntly say that Pump.fun has "degenerated" the crypto industry. In any case, project parties in all links of the meme industry chain have already made rich profits. The meme distribution platform Pump.fun has been showing a daily income of nearly one million US dollars since its launch. On the trading side, TGBOT used to be the absolute protagonist, but now there are new players entering the market.

For several months, GMGN has become the most relied-on tool for many meme players to "scan the chain". On the basis of presenting the trend of tokens, GMGN packages the on-chain data into trading signals. "Information gaps" such as "rat warehouses, large holders of coins, KOL holdings, and smart money movements" that are difficult for novices to obtain have now become products within the reach of users, and have also driven meme gameplay to be faster and more radical.

GMGN information display below the token trend chart

BlockBeats talked to the GMGN team and tried to understand the meme market from the perspective of "water sellers".

GMGN Entrepreneurship Experience

GMGN team has about 20 members, all of whom have many years of work experience in tool products in Web2 giants. Founder Jerry Ma has more than 20 years of experience in tool product development, and product and marketing consultant Haze has many years of product experience in the cryptocurrency field.

BlockBeats: GMGN has experienced development from 0 to 1 in less than a year since its launch. Can you introduce the development history of GMGN?

Jerry: We have gone through a process from obscurity to being gradually accepted by the market. GMGN started operations in September and October last year, initially focusing on the Ethereum chain and providing services to track the movement of smart money, which is somewhat similar to the NFT Track we did before. In March of this year, the market began to recover, Pump.fun led the popularity of the entire Meme market, and we also connected to the Solana chain. What impressed me was that on the first day we connected to Solana, the transaction volume exceeded that of Ethereum, and the market response was very enthusiastic.

BlockBeats: Which website data does GMGN value most? How is its performance in this regard?

Jerry: We mainly focus on the number of transactions and the number of people, not just the transaction volume. The number of transactions and the number of people reflect the activity of the product and the stickiness of users. The transaction amount is affected by market conditions, but the number of transactions and the number of transactions can better reflect the product's capabilities and user retention. GMGN has tens of thousands of transactions every day, with thousands of traders, and an average of 10-15 transactions per person per day.

BlockBeats: How does GMGN make money?

Jerry: Our current business model is very simple, charging a 1% handling fee for each transaction. In the future, we may launch some services for project parties, involving advertising fees or other income, but currently it is still mainly based on handling fees.

BlockBeats: GMGN has undergone several iterations in the past few months. Can you give some specific examples?

Jerry: We have been iterating products based on user needs. For example, we created a signal channel based on a telegram bot, which brings together various transaction needs of users. For example, you can set a signal reminder when a coin has more than 5 smart money buying, dev burning coins, Pump.fun pool full notifications, etc. In addition, the situation that the project party opens social media and buys advertisements on dexscreener is also displayed as independent signals on GMGN, which are displayed simultaneously on the website and tgbot. In the future, GMGN will also launch signal copying and stop-profit and stop-loss functions to help users save time.

BlockBeats: Do GMGN team members often trade memecoin?

Jerry: I think it is important to be passionate about what we do. Many people on our team are actually using their own products to participate in memecoin transactions. We even have designers who made more than 50 transactions a day during the product beta phase. Through these practical operations, we can find the missing points in the market and the shortcomings of the product, so as to continuously optimize our tools.

BlockBeats: What are the operating costs of launching GMGN?

Jerry: The cost of doing data analysis is not low. It is difficult for ordinary developers to afford our server costs because we have to continuously store and analyze data, so the monthly server costs are close to 100,000 US dollars.

BlockBeats: What "detours" did GMGN take in the development process?

Jerry:In the crypto industry, it is difficult to judge which track, which market, and which chain will be popular in one or two months. The answer cannot be deduced through traditional deduction, so we adopt the common method of Web 2, small steps and fast trial and error. Before Solana, we tried Ethereum, Blast, Base and other chains.

No matter what we do, wrong decisions will definitely happen. What we have to do is to verify the market demand with the lowest cost. For the information we come into contact with, our strategy is to invest a low enough cost, then create an MVP and throw it into the market for verification. If someone in the market uses this thing, or the response is good, then we will continue to build it in depth. If we find that we have not hit the demand point of this market, then we will think about what to do next.

BlockBeats: What are the advantages and challenges of the team's Web2 experience in starting a business in the Web3 field?

Jerry: I think our biggest advantage is that Web3 is still in the "wild era" and many infrastructures are still not perfect. After more than ten years of development, Web2 has gradually moved inward, while Web3 is like a new continent, full of untapped potential. At this stage, there are few competitors and great opportunities, which is why we chose to invest in Web3. Having seen Web2 grow from wildness to prosperity and then to involution, I think the development path of Web3 is the same, just at a different stage. Early stages have their own ways of playing.

The challenge of Web3 is mainly its special financial attributes. We are still learning about finance and trading.

BlockBeats: There are both novice and veteran users in the crypto market, and their trading needs are also different. How does GMGN consider when making user portraits?

Jerry: The first users we targeted were ordinary white users, and the first function we launched was to track smart money. However, we found that the market response to this function was very good, but there were not many users who actually traded based on this function. After reflection, we believe that the user groups remaining in the market have their own trading habits.

So we began to transform and put more energy on professional users, providing professional users with more dimensional data analysis and faster trading speeds. The first wave of innovative functions that made GMGN popular was to display "rat warehouses", which no tool on the market had launched before. After GMGN launched this "rat warehouse" function, it was particularly popular among professional trading users. When they buy each meme coin, they need to investigate the background of the entire project party and the holdings of the development team. This process requires traders to check the data on the chain and judge the situation of rat warehouses. GMGN helps traders save a lot of time. The dev rug rate launched later also conforms to the usage habits of professional traders. Slowly, meme traders will rely on the GMGN platform.

The needs of meme players are also different. Some people may like PVP, which requires faster data analysis and transaction speed. But some people have little time to participate in PVP new coins, and will participate in some tokens with relatively large market capitalization and room for growth. We will also classify users. If you like to participate in PVP, you can trade in the PVP channel. If you like relatively stable coins, you can refer to the signals provided by GMGN, such as whale purchases and large trading volume in the past week.

Meme brings "new retail era of assets"

The meme craze and the proliferation of PVP models have made the community realize that the crypto market is showing more pure gambling characteristics. Some people think that this is a manifestation of the crypto market being more realistic, moving towards the masses, and "eliminating the false and retaining the true", but some people feel negative and pessimistic, thinking that the crypto market is losing something precious.

BlockBeats: How do you view the future development of the meme market?

Haze: Regarding the meme market, I think it will always exist. The meme market reflects a fundamental shift in user demand. I define it as a "new retail era of assets", and what is reflected on GMGN is the "new retail era of data".

The new retail era of assets can be understood as Pump.fun is similar to a supermarket, operating a large number of goods at a low cost, and then continuously selling them to users. Its timeliness, emotional value, and attention can be summarized in four words: fast hit and fast sale. Instead of a narrative that needs long-term falsification like the previous VC coins, everyone pays for dreams, suffocates for quilts, and lets the market dream rate take off, and poetry and distance together. And meme coins are not empty, only the immediate compromise, and occasionally there is poetry and distance. Both the model and efficiency have changed fundamentally, and a large number of users recognize this model. Am I here to make a fortune in the currency circle? No, I am here to turn over. Then who doesn't like something that can quickly trial and error at a low cost and can earn huge profits?

Every different asset issuance model will create a group of rich people, and these rich people will determine the mainstream voice and gameplay of the market in the next stage. I think memecoin will have a greater advantage in the next market. Compared with the previous asset issuance models NFT, GameFi, and inscriptions, memecoin is purer, has better liquidity, and is easier to understand.

Such an asset issuance and trading model has high requirements for data analysis. Compared with some previous data platforms, GMGN is closer to user needs and forms a closed trading loop based on users' actual usage habits.

BlockBeats: Does GMGN have any estimates for the future development scale of the meme market?

Jerry: Before we started, we had already made a judgment on the market size of this track. According to various data, although the meme market is not particularly large, it has reached a market size of 1 billion US dollars. If the bull market comes, this scale may expand to 5 billion or even 10 billion US dollars. We believe that in such a large market, we will definitely have a place. So we are very optimistic about this market and will continue to deepen our efforts in this market.

BlockBeats: How to understand the change in the mentality of investors in the crypto market?

Haze: We talked about the popularity of memecoin before, which made everyone feel that the industry was just speculating on air and had a sense of disillusionment. Speculating on memecoin is like throwing a broken jar.

After the bankruptcy of FTX, which was once very influential, many people also expressed concerns about the future of the Crypto market. But since then, the crypto market has continued to develop. I think an important feature of blockchain compared to traditional finance or other industries is that it has a stronger self-cleaning ability. It is mainly a feature of blockchain. The transparency of on-chain data allows a large amount of information to be seen by ordinary users, and advanced users can make good use of this information. When FTX went bankrupt, many retail investors ran ahead of institutions. This is a good example.

Users no longer pay for the dream of VC coins because transparent data tells everyone that "you are making unequal investments and you are taking over at a high price." Everyone likes memecoin because it is fair. Of course, some voices may say that the conspiracy group opened the market and set up a game, but this part will not be discussed for now. Fair trading, let's play meme together. It has become the mainstream voice in recent months. The transparency of data has once again pushed the industry to self-cleanse. The community jokingly calls it the awakening of leeks, the bull market where no one takes over, and the VC coin that "even dogs don't play." The hot memecoin market also reflects that everyone believes more in a certain trend at a certain stage, and his money and energy will be concentrated on that place.

So I don't think that meme coins have made this industry feel destroyed. Often this also proves that the value of the industry lies in fairness, transparency, and all data can be checked on the chain. Most of the time when meme players trade meme coins, they keep a close eye on the data and exchange time for space. In the community, everyone calls it sitting in the dark. Trading VC coins cannot make you rich overnight, but memes can. As long as you are a little more diligent and a little faster.

BlockBeats: What do you think of the weak performance of the traditional "value coin" market?

Haze:I think a very important factor is that liquidity is not that strong, so meme coins are as popular as fast-moving consumer goods. Those vc coins are like high-end luxury goods, which lack purchasing power at present. But the liquidity that most small commodities can accommodate is limited.

Just now I mentioned that data transparency has allowed the industry to enter a self-cleaning stage, and value coins are in a self-cleaning stage. There are all kinds of birds in the forest, and it does not mean that all value coins are really worthless. People who play value coins are not really going to play memecoin. I think many value coins will return to a rational price range in the future, and people who have higher demands for liquidity and project stability will take action.

The final link of data analysis is trading

During the development of the crypto industry over the past few years, the market demand for data analysis has always existed, but the profit model is relatively simple. One-stop data analysis and trading tools represented by GMGN have stepped out of the "highbrow" revenue model such as subscription fees or advertising fees, and are moving towards the direction of on-chain DEX.

BlockBeats: Compared with previous on-chain data analysis tools, what changes has GMGN made?

Jerry:The ultimate goal of data analysis is still trading. When we were doing NFT track, I think the mistake we made was that we paid too much attention to data discovery itself and ignored some cognition and understanding of trading. So when we were doing GMGN, we made up for this shortcoming. We not only did data, but also attached great importance to the user's trading experience.

Previous tools, such as Dune and Nansen, mainly serve professional analysts. Their data dimensions are very comprehensive and can analyze the trends of the entire industry or the trading status of a certain token. Their revenue model is relatively simple, usually subscription fees and membership fees.

However, as the entire market changes, from the wild era to the existence of some infrastructure, data analysis tools are slowly moving towards ordinary trading users. People are no longer satisfied with some basic data analysis, but need to discover new and worthy assets through data analysis. I hope to judge my entry and exit timing through data. In this process, there will be some demand for data packaging. The so-called packaging is to package a batch of very complex data into a rat warehouse, a trading signal. This demand will not be the focus of the previous data platforms. They still serve their professional users, so this is a new opportunity for GMGN.

GMGN helps ordinary users better participate in the market by providing easy-to-use tools and signals. I think this is the inevitable result of the market gradually evolving from the "wilderness" to a more mature stage, and our strategy is to find our own opportunities in this evolutionary process.

Haze: I think this is more based on the most extensive user demand changes. Whether it is user structure or data discovery needs, there have been very big changes compared to the past. A large number of newcomers have entered the chain to start trading memecoin, and some of the trading methods of mature memecoin traders are based on on-chain data. If you understand the on-chain data, you can be one step faster than others. One second faster than others may be a 10-fold difference in revenue in memecoin. So the demand for data can be said to have suddenly exploded. And not everyone can use those traditional high-end data platforms professionally. In such a pure and fast place in the currency circle, no one will waste more time learning to use a complex data platform. So the biggest change made by GMGN is to make data accessible to ordinary people.

We are building a new data retail platform. I give you the data you think is a decision signal, and you can directly make a transaction on GMGN. It is equivalent to buying GMGN data once.

I have also bought VIP of tools like Nansen. I also learned how to look at the board of Dune. But I think they are more high-brow. There is a lot of data, but it is like giving me an engine (database) and letting me build an Audi, Mercedes-Benz or Maybach (decision signal) by myself. But for ordinary users, it takes a lot of effort to build a car (sorting out signals), but the final result may also be that the Audi becomes an Alto. More users hope to get the "model" they need directly. As for the final transaction result, it is a matter of "driving level". So what users need is a 4S store that sells all kinds of cars. If you want to drive on mountain roads, I will give you an off-road vehicle. If you want to drive on a track, I will give you a sports car. If you want to take care of children, I will give you a nanny car. It's that simple and direct. Instead of giving users an engine, if you have a need, build it yourself.

BlockBeats: In what aspects does GMGN fit the characteristics of the meme market?

Haze: Pump.fun has improved the efficiency of asset issuance, which is more than a hundred times higher than Ethereum's ICO. Extremely low costs bring extremely high efficiency, and extremely high efficiency determines the characteristics of the meme market. In such a track, data platforms also need to improve efficiency, speed, and change models.

In order to improve innovation efficiency, GMGN has a 500 user access list during product development. They are all our deep users. Our product personnel constantly communicate with them and rank their needs at the S level of internal needs. As long as they pass the evaluation, they must be launched within 1 week. Therefore, when GMGN packages the data of the meme market into products, the efficient communication on the front line and the efficient execution of the team will basically not disappoint users' expectations. For example, the mouse warehouse function, CTO function and smart money function are all loved by users. The fast meme market is a major feature. In order to make the data display faster, we changed 3 people in the position of performance manager. Finally, we found the best one. Now GMGN's data is 10 times faster than some similar platforms.

Then it is to change the model, which is also the data platform car-making thinking I mentioned before. What car do you want? I will give it to you directly. Not only will I give it to you, but you can drive it directly on the road. You make money well, and leave the rest to GMGN.

GMGN page

BlockBeats: Has the on-chain analysis tool formed a track? What is GMGN's current moat?

Jerry: I think so, but I don't completely regard it as an analysis tool, but more like a trading tool track on the chain. I think the prosperity of this track is mainly due to the opportunity provided by the Solana ecosystem. Because of memecoin, people have seen the potential to make money in this track, and more talents have joined in. I think this is a good thing. As more and more trading tools emerge, the market will force us and other products to continue to innovate and remain competitive, and users will also benefit from it. Tools become simpler and faster, which is a virtuous circle.

Each team will do something in the field they are good at. Our team pays more attention to the whole chain solution, integrating data and trading services. Some products on the market may only do market watching or quick trading, but we hope to provide a complete solution so that users do not have to switch tools repeatedly to improve efficiency.

We have also noticed that many competitors are constantly imitating the functions of GMGN, but I don’t think this will affect GMGN. The core competitiveness of GMGN is not only the data and trading experience itself, but also the accumulated cognition of our team on this track. Through the improvement of cognition, we can continuously package more valuable data for users, and these data will continue to impact the current meme market. This innovation ability is the core competitiveness of our team. We feel that there are still many things to do. The market is constantly changing, so innovative points will continue to emerge.

BlockBeats: Will GMGN consider developing a revenue-integrated platform similar to Pump.fun?

Jerry:Dexscreener has made similar attempts before, launching Moonshot, but the product differentiation may not be obvious enough. If you compete with a market leader that has already occupied the market, it is difficult to stand out by relying on traffic without differentiation. Dexscreener's traffic may be three or four times larger than Pump.fun, but in fact there are not many users trading on Moonshot. So the core is not the size of the traffic, but whether the product itself has innovative contributions to the market.

Pump.fun's biggest contribution is that it first broke the rules of the entire trading market, issuing a token at a low cost, and the model is relatively fair. There is also a certain amount of liquidity in the early stage. This is the core competitiveness it can achieve in this market. Unless the new product can solve a deeper problem than it, it is possible to break this thing.

At present, we keep thinking about innovation. If one day we find that we can solve the problems that Pump.fun has not solved, we will consider developing such a function.

BlockBeats: In the "new retail era", are some of the DEXs that appeared in the last round also facing corresponding challenges?

Jerry: I think so. The market is still in a very early stage, and many things have not yet been finalized. Even if a project has a great advantage in the last bull market, it is still unknown whether it can maintain its position in this cycle. This year we have seen that Pump.fun has swallowed up more than 40% of the market share on Solana, which everyone can see. Uniswap had an advantage in the last round, and I believe they are also trying to change, but this trend is difficult to reverse. Unless they can continue to iterate, keep up with trends, and stay ahead like us or other players on the track, they may be eliminated by the market.

My understanding is that this is not only the case in this round, but we also saw some new tools emerge in the last round, such as the emergence of aggregated trading platforms like Birdeye and Jupiter on Raydium, which solved some problems in trading experience and speed. And memecoin makes the entire market faster and cheaper, which has also spawned some different things. Entrepreneurial teams must constantly observe and follow up in order to survive in this rapidly changing market.

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