OKX Friends Issue 01 | Alpha Mining Journey and Experience Sharing by Senior On-Chain Player 0xSun

Guest Message

Web3 is characterized by decentralization, openness, and fairness, making it an industry full of opportunities and risks. OKX has always been a leading exchange in the industry, and the OKX wallet is currently my favorite multi-chain wallet. It is truly remarkable that OKX can develop such a wallet product while excelling in centralized exchange operations, bringing convenience to users!

0xSun, a seasoned player on-chain, Alpha trader, and discoverer of the hundredfold golden dog. He first encountered blockchain during his graduate studies, with his entry into the space stemming from the meme craze. During the last bull market, he quickly gained multiple returns by trading memes. Not only that, but he also earned nearly 200 ETH from the Monkey Land project.

In 0xSun's view, the ability to achieve these representative results is mainly attributed to two advantages: first, he has a background in computer science, which gives him a unique sensitivity and technical foundation when operating smart contracts and analyzing project functionalities. Second, during his graduate studies, he improved his information retrieval, summarization, and rapid project value judgment skills through extensive reading of English literature. These skills help him quickly understand projects and make accurate judgments in the time-sensitive on-chain arena. Additionally, he emphasizes that interest is the driving force behind his continuous progress, helping him develop a self-created methodology for making money on-chain.

Given his rich experience and the broad representation of the player group he embodies, OKX has specially invited him to be a guest speaker in the "Friends of OKX" series, hoping his sharing can provide references for many on-chain players.

++The "Friends of OKX" series is a special column produced by OKX, hosted by OKX official community ambassador Mercy (@Mercy_okx), aiming to provide new users with learning references by exploring the stories, industry thoughts, and lessons learned from KOLs with different backgrounds.++

I. Alpha Mining Methodology

1. Mercy @Mercy_okx: How do you mine effective and valuable information?

0xSun @0xSunNFT: I mainly obtain information about early projects and profit opportunities through the following three channels: Twitter, on-chain monitoring, and tracing back to the source.

1. Twitter: Most projects release the latest information on Twitter. I follow some valuable bloggers, especially those with fewer followers but focused on a specific area. By following these information sources, Twitter's recommendation algorithm gradually suggests more similar content, becoming an important source of information.
2. On-chain monitoring: For example, using Dexscreener, I check new coins on the hot list based on trading volume, transaction counts, and other indicators, then further dig into related information, evaluate project quality through Twitter or official websites, and also combine wallet monitoring tools to learn what active smart money is participating in on-chain projects.
3. Tracing back to the source: Monitoring newly deployed contracts and checking project party information. This method provides a large amount of information but is time-consuming. For ordinary players, using Dexscreener and on-chain monitoring is sufficient. Tracing back to the source is suitable for players with higher demands.

Overall, these three methods each have their pros and cons, and a reasonable combination can effectively discover early projects and profit opportunities.

2. Mercy @Mercy_okx: How do you assess a project's potential value?

0xSun @0xSunNFT: I evaluate projects mainly by looking at five key factors:

• Project narrative: Assessing the core concept and value proposition of the project.
• Market heat: Analyzing the team's investment and efforts in promotion, as well as the project's own heat; overly hot projects are prone to rug pulls, while overly cold projects may struggle to launch.
• Token distribution: Using on-chain data analysis tools to view the proportion and changes of tokens controlled by the team.
• Degree of innovation: Judging whether the project has innovative points and what level of narrative that innovation belongs to.
• Team operations: Paying attention to whether the team is controlling or pumping the market, and whether they are continuously operating and doing things.

Although on-chain projects have high transparency, allowing for clearer visibility of related information, this does not mean they are necessarily safe. Teams may still manipulate the market in various ways. We should comprehensively consider factors such as project narrative, promotional efforts, and token control, and use on-chain data tools to make judgments. However, even so, it cannot guarantee 100% accuracy. The direction of the crypto market is often determined by a few individuals, and we can only strive to improve the accuracy of our judgments rather than completely predict market trends.

Additionally, I want to share an insight: even having a high influence in the crypto circle makes it difficult to obtain real "insider information." There is no one in the market who will privately inform you that a token is about to skyrocket. The only ones who might grasp core information are a few foreign influencers closely related to the project parties. Therefore, so-called insider information often carries risks and may come from bad actors or information utilized by project parties. Such information can lead players to have overly high expectations, resulting in operational errors. I advise everyone not to overly rely on or exaggerate the role of insider information.

3. Mercy @Mercy_okx: Do you have any experiences to share regarding on-chain risk control?

0xSun @0xSunNFT: The on-chain environment is inherently a place of high risk and high reward, and experiencing losses is very normal. For example, this year, I incurred significant losses from the staking project Zkasino and the Fomo presale. I invested $25,000 and 30 ETH in Zkasino, only to be rug pulled and lose everything. In the Fomo token presale, I initially invested 15 ETH, but after seeing the price drop post-launch, I added another 15 ETH, ultimately losing all 30 ETH.

The most difficult experience for me during the NFT period was the Mint of KPR NFT. My friends and I prepared 300 whitelist spots, but to save on gas fees, I provided insufficient gas, resulting in a failed Mint and a loss of 35 ETH in gas fees. What could have been a chance to earn 150 ETH ended up being a total loss due to operational errors. These experiences made me realize the importance of on-chain risk control.

First, one must fully recognize the high-risk characteristics of the cryptocurrency market when playing on-chain. Compared to traditional investment fields, the cryptocurrency market is more volatile and carries higher risks. Especially in on-chain trading, you face more potential risks, such as encountering bad project parties who directly abscond with presale funds or withdraw unblocked liquidity pools. Second, do not let the temptation of high returns cloud your judgment. Although there is potential for high returns in on-chain trading, not everyone can easily make money. This is particularly true for newcomers, who need to be especially vigilant due to the many traps.

To better mitigate risks, here are some specific suggestions:

1. Use contract detection tools: For projects involving smart contracts, players should utilize relevant tools for risk assessment.
2. Implement risk management and position control: Do not blindly invest all your funds due to high return expectations; even for promising projects, control your capital scale appropriately.
3. Stay vigilant: In on-chain trading, even seemingly reliable projects may encounter unexpected situations. Players should always be prepared to deal with the worst-case scenarios.

Finally, preserving your principal is crucial. The cryptocurrency market offers numerous opportunities, and only by preserving your principal can you continue to participate. Ensuring the safety of your funds is more critical than obtaining high returns in the short term.

II. Meme Development in the New Cycle

4. Mercy @Mercy_okx: How do you view the development of memes in this cycle, and can you share your largest current holdings?

0xSun @0xSunNFT: The phenomenon of fragmentation in the current cycle is very evident. Compared to the previous cycle, both meme coins and VC coins have seen a significant increase in the number of coins in this cycle. In the last cycle, when animal coins were mentioned, people first thought of Doge, promoted by Musk, and then Shib, which had many connections with Ethereum founder Vitalik Buterin; these coins were relatively concentrated.

In this cycle, however, the situation has changed. On one hand, players' experiences have generally become richer; on the other hand, the fragmentation of the meme coin track is particularly severe. For example, the recent debate over capitalization and the daily issuance of hundreds, thousands, or even tens of thousands of new coins by PumpFun have made it difficult for individual coins to reach the peak levels of the previous cycle. Taking the leading coin of this cycle, Pepe, as an example, although its performance is very strong, its market cap still lags several times behind Shib. This is largely due to the fragmentation of meme coins and the overall fragmentation of token trading.

A few days ago, I saw data indicating that the total value of stablecoins in the current cycle has not significantly increased compared to the peak of the previous cycle, but the number of tokens has increased by dozens of times. This makes it difficult for individual tokens to reach the highest market cap of the previous cycle.

As for my current holdings, I have previously shared that I mainly hold stablecoins because I have an uncertain outlook on the market.

5. Mercy @Mercy_okx: In the context of USDT, I recommend everyone use OKX's Token Treasure series. I want to ask you, 0xSun, how are you currently allocating your USDT?

0xSun @0xSunNFT: I personally believe that you should first select a track and then allocate assets within that track. For example, if you plan to participate in airdrops or on-chain projects, you may need to purchase some Ethereum as principal. Then, based on investments in that ecosystem, you can achieve Ethereum-based growth, which may be relatively stable. At the same time, you can convert your assets into stablecoins, Bitcoin, or continue to accumulate your local currency based on market conditions. If you focus on the secondary market, you may need to consider the cycle.

III. Advice for Newcomers

6. Mercy @Mercy_okx: If starting from scratch with only USDT, how would you allocate assets in the crypto field?

0xSun @0xSunNFT: First, choose the track you like the most, are most interested in, or are best at. Whether it's playing on-chain, grabbing airdrops, engaging in chain games, or doing spot trading or contracts in the secondary market, choosing one track to master is quite good; you don't need to know them all.

When selecting a track, I recommend paying attention to top bloggers in various tracks or reading several investment research reports to spark your interest, identify your capability zone, and then continuously correct yourself through practice. Once you have chosen a track, you should allocate assets accordingly. For example, if you plan to participate in airdrops or on-chain projects, you may need to purchase some Ethereum as principal; for most newcomers, this step may already be sufficient. Because for newcomers, the primary goal is to increase their token holdings and achieve a positive cycle. For instance, focusing on the Solana ecosystem and operating with Solana as the base means that when the cycle improves, you will achieve a positive return cycle.

However, during a market downturn, newcomers may need to consider converting some tokens into stablecoins and repurchasing when the market reaches a more suitable position. Alternatively, using profits to accumulate Bitcoin is also a relatively stable strategy. As for trading altcoins in the secondary market, I recommend following the market's major trends and hotspots, choosing popular leading coins to participate in.

7. Mercy @Mercy_okx: With the development of the industry and the expansion of its scale, people's awareness or threshold for wealth effects will also be raised. How can newcomers quickly accumulate wealth?

0xSun @0xSunNFT: On one hand, it's about choice and awareness. First is the choice of track. A common example is last year's inscription market; if you put two identical people in the crypto space, one playing NFTs and the other playing inscriptions, the one playing inscriptions is likely to earn ten times more than the one playing NFTs. This is not a matter of personal ability but a difference in tracks.

Secondly, the volatility on-chain is very strong, requiring sufficient psychological endurance. Even if you buy all in on an exchange's tokens, it may take time for them to drop by half. On-chain projects can go from soaring to zero in just seconds. For those who have not been exposed, it's easy to have doubts about whether it’s a scam.

Therefore, you must have sufficient awareness of this track and be mentally prepared. Additionally, consider whether you have enough time and energy to invest, and whether your overall trading style suits this track. I know some friends who are very skilled in secondary market trading; they have also tried on-chain trading but ultimately found they couldn't keep up with the pace. On one hand, they don't have enough time and energy to monitor the market, and on the other hand, their trading style leans more towards holding a promising asset long-term.

Moreover, due to the severe fragmentation in the current cycle, very few assets can be held from start to finish and yield significant profits. More often, it involves continuously discovering new projects, seizing the first wave of benefits, and then taking profits at appropriate positions, repeating this cycle. The second aspect is to follow market trends; you need to find market hotspots and areas where more funds and people are gradually joining to truly benefit from industry dividends.

IV. Discussing the Connection with OKX Wallet and Product Experience

8. Mercy @Mercy_okx: As a seasoned on-chain player, when did you start using our OKX wallet, and how do you feel about it?**

0xSun @0xSunNFT: I started using the OKX wallet when I was playing with inscriptions, and the user experience has been very good. First, the OKX wallet supports a very comprehensive range of chains. For example, in the Bitcoin ecosystem, EVM chains, or SUI chains, you usually need to install different wallets separately, which is cumbersome and time-consuming for users. However, the extensive chain support of the OKX wallet saves these troubles.

Secondly, another advantage of the OKX wallet is its self-built nodes. For instance, when trading on SOL or other less popular chains, using other wallets or self-built nodes may result in transaction delays or failures. But the nodes built into the OKX wallet ensure smooth transaction execution.

One of my most memorable experiences was during the launch of the Cupidon token last year. I tried various wallets but failed to purchase successfully; ultimately, I quickly completed the transaction on the OKX wallet at a price of 0.6. This performance was very satisfying. Additionally, the OKX wallet is also very convenient for managing multi-chain assets and multiple wallets.

Risk Warning and Disclaimer

This article is for reference only. The views expressed in this article are solely those of the author and do not represent the position of OKX. This article does not intend to provide (i) investment advice or recommendations; (ii) offers or solicitations to buy, sell, or hold digital assets; (iii) financial, accounting, legal, or tax advice. We do not guarantee the accuracy, completeness, or usefulness of such information. Holding digital assets (including stablecoins and NFTs) involves high risks and may fluctuate significantly. You should carefully consider whether trading or holding digital assets is suitable for you based on your financial situation. Please consult your legal/tax/investment professionals regarding your specific circumstances. You are responsible for understanding and complying with applicable local laws and regulations.