Author: defioasis | Wu
Editor of this issue: Colin Wu
TG Trading Bot (TG Bot) has emerged in the recent sluggish market environment. Coingecko has launched the TG Bot section, and related TG Bot concept tokens have increased by dozens or even hundreds of times in just a few weeks. In the past quarter, the UNIBOT token has increased by at least 50 times. Although TG Bot concept tokens have become popular recently, in fact, whether it is Telegram, Discord, or WeChat, these types of plugin-like bots have been around for a long time.
Bot User Experience
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As a TG Bot used for trading purposes, it will not deviate from users’ trading habits and some characteristics of DEX to develop, and will provide a more comfortable user experience in trading based on DEX. Currently, TG Bot mainly serves Meme players who pursue high returns and high risks. For these players, the trading bot will provide different functions based on the pre, mid, and post-trading.
First, obtain first-hand information channels for Memecoins before trading. The channels can be divided into two points. One is at the token level. TG Bot will monitor the birth of a new token from multiple dimensions, such as the size of the pool, celebrity releases, low/high taxes, LP lock-up time, and the number of purchases by old wallets, etc. The second is the operation of Smart Money. TG Bot will monitor high-win rate wallets with the characteristics of small bets and big wins across the entire network, and provide one-click copy trading functionality.
After obtaining first-hand information, if you choose to trade within TG Bot, there are two options: importing the wallet or depositing into the wallet generated by TG Bot. Generally, it is the latter. In the process of trading, there are three pain points in the trading process: transaction speed, slippage, and MEV attacks. To address these points, TG Bot will provide some functions, such as sniper functionality for tokens that have just been issued, providing limit orders, customizing slippage, and using TG Bot’s private node trading to achieve faster response speed and avoid being attacked by sandwich attacks.
After the transaction is completed, some TG Bots may also provide profit/loss calculation and analysis for user addresses.
Project Profit Model
TG Bot’s profit model can roughly be divided into four types.
① Membership fee system, which means that a certain fee needs to be paid before using the bot, with prices around 0.1 ETH for one month and 1 ETH for one year. This model tends to be more private and community-based, and is more suitable for KOLs who can attract loyal users, or even a project started by members of a Meme group.
② Free trial but with transaction fees, represented by Unibot. Unibot charges 1% of the transaction fee for each transaction, which is a secondary charge on top of the Uniswap transaction fee. However, Unibot will distribute 40% of the fee to its token holders. Therefore, as a user and a token holder, a relatively benign relationship can be formed. Currently, Unibot has a daily active user base of approximately 1,000 to 1,500, but the fees it captures are not inferior to some major protocols.
③ Combining transaction taxes and membership models, the representative is Maestro. Maestro’s overall functionality is similar to Unibot, also charging a 1% fee per transaction like Unibot. However, Maestro has not yet released tokens, and all fees are recorded as protocol revenue. In addition, they have also launched a $200 per month VIP community service, where members can access carefully selected Smart Money addresses or wealth passwords.
④ Holding a certain amount of tokens can allow users to use the trading robot for free.
Factors for Explosive Growth
TG Bot’s recent explosive growth may be attributed to successful on-chain marketing and grassroots counterattacks. Whenever a Memecoin becomes popular, crypto traders are eager to find those Smart Money wallets, and analyze the historical behavior of those wallets to imitate and follow their trades. TG Bot undoubtedly meets this demand, especially since TG itself is an essential social app in the crypto world, integrating trading and social interactions, making marketing and spreading information about on-chain addresses very convenient.
On the other hand, the fundamental reason why low-net-worth players are not chasing mainstream currencies but are enthusiastic about Memecoins is to accumulate wealth in a short period of time, especially stimulated by so many stories of getting rich quickly. Successful Memecoins mostly create a fair environment, conveying the idea of anti-VC. TG Bot is similar in this regard as well. It is down-to-earth, based on the widely used social app Telegram. In addition, exposure on data websites like Coingecko and DeFiLlama has allowed TG Bot to capture fees that exceed the valuations of billion-dollar projects backed by venture capitalists. Users of TG Bot also take pride in this, seeing TG Bot Token as another form of meme, embodying the idea of grassroots counterattacks. Of course, it is undeniable that the TG Bot project team is intentionally or unintentionally catering to this narrative.
Opportunities and Risks
Currently, the TG Bot track is still in its very early stage, with the entire market worth billions, and it is still primarily focused on trading functions. In the future, it may develop the robots into a more diversified and even aggregated platform. Additionally, in order to achieve long-term development, users must be encouraged to use TG for both chatting and trading, converting TG users into TG Bot users.
However, at the same time, the risks of TG Bot are also clear. Its moat is relatively weak, and its functionalities are relatively homogenous. To maintain long-term competitiveness, the project team needs to continuously iterate and update its functionalities. Furthermore, new entrants to the TG Bot space may choose to compete on transaction fees, engaging in “price wars”. Another risk is security, including wallet security and token security. TG Bot cannot guarantee that imported wallets or generated wallets will not leak private keys, which limits the amount of funds that can be accommodated in this market. TG Bot is also unable to confirm the security of newly created token contracts and token models. For example, the previous case of PNDX, introduced by LianGuaiuly, the founder of the NFT marketplace Not Larva Labs, had vulnerabilities in its contract, and its model required minting on the official website. However, TG Bot was unable to detect these two points, resulting in users who purchased through TG Bot becoming victims of liquidity exit scams.
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