The ‘fur-raising ecosystem’ in the encrypted winter Project parties adept at PUA, while small and medium-sized studios are complaining incessantly.

Author: Deep Tide TechFlow Cleaner

On August 15th, when SEI/Cyber officially launched on Binance, the community was in an uproar, with many claiming to have been PUA/unraveled, and quickly reached a consensus: “Domestic projects only know how to PUA, lacking vision. It’s better to focus on foreign teams and projects with high financing.”

Some bizarre “rumors” also spread: the founder of SEI is actually the younger brother of Pinduoduo founder Huang Zheng. SEI staff members told Deep Tide TechFlow that this is purely a rumor, and the SEI founding team is all American. After investigation, it was found that this originated from the community’s ridicule of SEI, saying that “the progress is always stuck at 99%”, and it was spread as a result.

The most affected are the full-time unravelers, with many people exclaiming on Twitter, “The unraveling studio is about to face a wave of closures.” Indeed, we have found that many small and medium-sized unraveling studios have entered a state of suspension.

Jin Lian relied on airdrops from dydx\ens\arb to make a fortune, and then established an unraveling studio in a second-tier city, hiring relatives and college students to unravel full-time. However, two months ago, he closed the studio, and Sui became their final swan song. “We have been investing without seeing returns,” Jin Lian said. Most small and medium-sized studios are “feeding the unraveling with hair”. Previously, they had high expectations, leading to blind expansion of personnel and addresses, shooting bullets (Gas) prematurely, coupled with the lack of new hair, and the increasing PUA from project parties. With no wealth effect in the market, unraveling studios have become unsustainable.

What makes Jin Lian reluctant to invest further is that “unraveling is becoming more and more demanding, and small studios like theirs can’t keep up with large studios.”

In June of this year, a team held an offline Zksync event in Shenzhen, with over a hundred attendees who collectively held hundreds of thousands of addresses, and this number continues to grow.

In Jin Lian’s view, unraveling studios have gone beyond the era of grassroots and are beginning to operate in a formal and centralized manner. In the future, only large studios will have survival space.

A mature unraveling studio should have:

(1) Infrastructure, such as a secure fingerprint browser, IP pool, and self-owned KYC…

(2) Loyal and obedient employees, including scientists;

(3) Money, capable of persisting for 2 years, or providing unraveling or IPO services to earn money in advance and transfer risks to retail investors.

“Project parties have also become shrewd, knowing that most addresses are just brushes, unraveling and running away. They will also find ways to counteract.” In this game, unraveling is transitioning from “low cost, high returns” to “high cost, low returns”, and even “high cost, negative returns”.

It is not necessarily the project party that gets “lured”, it could also be the studio itself.

Nowadays, the battle for Layer 2 dominance represents both opportunities and hidden dangers.

Currently, all Layer 2 solutions on the market have a centralized aspect. Transactions are packaged and sent to the chain through sequencers. The gas fees paid by users include two parts: the actual gas cost and the transaction fee. A large portion of the transaction fee goes into the pockets of the project party.

Driven by the myth of “OP/ARB”, a large number of people and funds have entered the “luring” industry, feverishly searching for new public chains and Layer 2 solutions that have not yet launched their tokens. Among them, Layer 2 solutions are the absolute main force for interaction. Hundreds of thousands, or even millions, of addresses are generated, and a massive amount of ETH is used for “meaningless” interactions.

Layer 2 solutions are laughing all the way to the bank. In the ZkSync Era, they profit handsomely from the centralized sequencers and the transaction fees, with the “luring studios” becoming their source of profit.

In addition, multi-chain “luring” has made “cross-chain bridges” a must-have, especially for Orbiter Finance, which focuses on low-fee cross-chain transactions for Layer 2 solutions. Orbiter Finance has become the biggest winner, earning millions of dollars every month by charging “bridge fees”, with over 90% contributed by the “luring party”.

The emergence of “OP Stack” and the ability to “launch Layer 2 solutions with one click” have intensified the battle for Layer 2 dominance. Both exchanges and project parties are launching their own Layer 2 solutions, including Coinbase, Bybit, Frax, Gitcoin, DeBank, and more. It can be foreseen that there will be even more Layer 2 solutions in the future.

They first attract the “luring studios”. Even though they know they may be the source of profit for the project party, many studios still continue to participate one after another, pursuing a chance to make a profit and truly embodying the essence of PUA.

In any case, the project party that launches tokens and earns transaction fees is the biggest winner in this “luring” game.

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