Under the crypto winter, PUA and the "撸毛" studios may face a wave of closures

Written by: Deep Tide TechFlow Cleaner

On August 15, when SEI/Cyber officially launched on Binance, the community of profit seekers was in an uproar, with many claiming they were being PUA'd or counter-harvested, and quickly reaching a consensus: "Domestic projects only know how to PUA, lacking vision; profit seekers should focus on foreign teams and high-funding projects."

Some bizarre "rumors" also spread: the founder of SEI is actually the brother of Huang Zheng, the founder of Pinduoduo. SEI staff told Deep Tide TechFlow that this is purely a rumor, and the SEI founding team is entirely American. Upon further investigation, it was found that this originated from the community's teasing of SEI, "progress always stuck at 99%," which then got distorted.

The most affected were the dedicated profit seekers, with many shouting on Twitter "The profit-seeking studios are about to face a wave of closures." This is indeed the case, as we have found that many small and medium-sized profit-seeking studios have entered a state of suspension.

Jin Lian made his fortune through airdrops from dydx\ens\arb, and later established a profit-seeking studio in a second-tier city, hiring relatives and college students to work full-time on profit-seeking. However, two months ago, he shut down the studio, with Sui being their last song. "I kept investing without seeing returns," Jin Lian stated, noting that most small and medium studios operate on "profit to sustain profit," having previously set overly high expectations, leading to blind expansion of personnel and addresses, prematurely spending their resources (Gas), coupled with no new major profits, and the project parties becoming increasingly aggressive in PUA, making it difficult for profit-seeking studios to survive.

What makes Jin Lian reluctant to invest further is that the profit-seeking game is becoming more competitive; small studios cannot compete with large studios.

In June of this year, a team held an offline event for Zksync in Shenzhen, attracting over a hundred people, all holding hundreds of thousands of addresses, and this number continues to grow.

In Jin Lian's view, profit-seeking studios have moved past the era of wild and chaotic operations and are beginning to operate in a more formal and organized manner. In the future, only large studios will have room to survive.

A mature profit-seeking studio should have:

(1) Infrastructure: such as secure fingerprint browsers; IP pools; proprietary KYC…

(2) Loyal and obedient employees, including scientists;

(3) Money, to sustain operations for 2 years, or to provide proxy profit-seeking or new token services, earning money in advance and transferring risks to retail investors.

"The project parties have also become savvy, knowing that most addresses are bots, who profit and run, and they will find ways to counteract this." In this game of cat and mouse, profit-seeking is shifting from "low cost, high return" to "high cost, low return," or even "high cost, negative return."

Those being profited from are not necessarily the project parties; it could also be the studios themselves.

Now, with the competition among Layer 2s, it represents both opportunity and hidden dangers.

Currently, all Layer 2s on the market have a centralized aspect; transactions are packaged on-chain through sequencers. The Gas fees paid by users essentially include two parts: the actual Gas and transaction fees, with a significant portion being transaction fees that flow into the project parties' pockets.

Under the myth of profit-seeking from OP/ARB, a large influx of people and funds has entered the profit-seeking industry, frantically searching for new public chains and Layer 2s that have yet to issue tokens, with Layer 2 being the absolute main force for interactions, generating hundreds of thousands or even millions of addresses, with massive ETH entering for "meaningless" interactions.

Layer 2s are thriving, with ZkSync Era profiting handsomely through operating centralized sequencers, making a fortune from transaction fees, and profit-seeking studios becoming their source of profit.

Additionally, multi-chain profit-seeking has made "cross-chain bridges" a necessity, especially with Orbiter Finance, which focuses on low-fee cross-chain Layer 2s, becoming the biggest winner, earning over a million dollars monthly just from "bridge fees," with over 90% contributed by profit seekers.

The emergence of OP Stack, allowing "one-click issuance of Layer 2," has intensified the Layer 2 battle, with exchanges and project parties launching their own Layer 2s, including Coinbase, Bybit, Frax, Gitcoin, DeBank… It is foreseeable that more Layer 2s will emerge in the future.

They primarily attract "profit-seeking studios," and even though they know they might be the project's profit, many studios will still rush in for that beautiful dream, profoundly interpreting the essence of PUA.

Regardless, the project parties that issue tokens and earn transaction fees are the biggest winners in this profit-seeking game.