Memecoins, cabals, and whales – everyone’sbeen talking about them for a while now, so let me break it down for you.
Every altcoin that launches directly on a decentralized exchange without venture capital backing has three key players:
- The Dev Team
- The Snipers
- The Whales
These groups vary in sophistication and overlap from coin to coin, but a good mix of all three is crucial for a coin to succeed long-term.
Let’s talk about the dev teams. There’s a spectrum of decentralization and organization here. On one end, you have teams like those on pump.fun – often just one person with a picture and a caption. On the other end, there are organized teams like those behind $BONK, featuring some of the smartest active crypto traders on Solana. Both types can do well, but their success also hinges on the involvement of snipers and whales.
Organized teams usually have a budget for marketing and future development, which means these coins can offer more utility than those originating from pump.fun. Take bonkbot, for instance – no fully decentralized meme coin is likely to produce a product like that due to funding limitations. Similarly, $MEW managed to airdrop a significant percentage of its supply to $BONK and $WIF holders, thanks to its organized team’s resources and connections.
On the flip side, fully decentralized teams often start with lower market caps because there’s no initial vested interest from major capital players. These teams excel at forming early cult communities due to the low cost for early entrants and widely distributed supply. $WIF and $MICHI are prime examples, launching with low market caps but active communities. The risk, though, is higher early failure rates as snipers aim to exit quickly, and there’s no vested interest from whales or the dev team for long-term success.
Now, let’s talk snipers. I’m not an expert sniper myself, but I know folks who are. Snipers don’t care about the project’s fundamentals; they just want to be first in and first out if there’s enough liquidity to cash out. Many projects without organized teams fail because snipers grab a large percentage of the supply at launch and sell it off immediately, wrecking the price chart. The ETHWIF derivative from a few months ago is a good example – many wallets bought at launch and sold within hours, netting six-figure profits.
Most dex launches don’t surpass a $5 million market cap because anonymous dev teams often make quick profits and bail. This is why the community takeover (CTO) narrative is popular – the devs typically sell out early.
Finally, we have the whales. Every coin that hits billions needs whales to drive the price higher. What usually happens with memecoins is that an early community forms, and once the meme gains enough attention and virality, it reaches a $100 million market cap. At this point, larger players start building positions due to sufficient liquidity. Early entrants must be diamond-handed, holding their positions to maintain the coin’s momentum. These cult community holders are vital for the project’s success.
So long story short, every coin has a dev team with varying levels of organization, snipers looking to make quick profits, and whales who drive long-term value. A fortunate mix of these elements is necessary for any coin to reach billions in market cap, whether these roles overlap or are distinct parties.