CEO of Droplet Capital Who Has Actually Made Money in This Bull Market So Far

This round of bull market, who has actually made money so far?
First, definitely not the VCs. Most of the projects invested by VCs have not even started issuing tokens yet. Even those coins with high FDV and low circulation that are criticized by the community, although they may look like they have increased several times on paper, if there is no altcoin bull market coming, when the VCs unlock, a 90% drop is not uncommon.
Secondly, it’s not the retail investors either. Most retail investors are trading memes, playing with altcoins, using contracts, and while some have made money, it’s very few, with the probability similar to playing the lottery.
Observing closely, those who have made money fall into these categories:
1. Bitcoin holders. Holding Bitcoin means the world is working for you. Last year at this time it was at 25,000, now at 65,000, huge gains. It’s almost certain that it will reach 100,000 within a year, but most people are not impressed by this increase, so they are unable to profit from Bitcoin, which is reasonable.
2. Centralized exchanges. Exchanges have always been at the top of the cryptocurrency food chain. Most of the cryptocurrency market is basically working with exchanges. Of course, working at an exchange also comes with huge risks, such as uncertainties, overseas operations, and regulatory risks, with risks and rewards being proportional, which is reasonable.
3. CeFi platforms like Tether. Tether made $4.7 billion in the first quarter, more than most exchanges. Strictly speaking, this money is not earned from the cryptocurrency market. In addition, some cryptocurrency financial service providers have quietly made a lot of money, such as custody and wealth management platforms, etc. They provide good services to the cryptocurrency market and their profits are also reasonable.
4. Operation teams of some public chains/DeFi products. The traffic of DeFi products like Uniswap is actually very high, and transaction fees have nothing to do with token holders, almost all of it goes into the team’s pockets, which is quite substantial income. The Base team may have made tens of millions of dollars in transaction fee income from a product contributed by Friendtech. The Tron public chain makes a lot of money from daily USDT transfers, most of which also goes into the team’s pockets. These projects do not rely on selling tokens to retail investors, but make money by developing their business, similar to traditional internet businesses. They are the hope of the cryptocurrency market and all project teams should learn from them. Especially with the example set by MakerDAO, and Uni preparing to distribute dividends, these are the alphas of this bull market.
5. Projects with high market value whose main purpose is to sell tokens. If they have already listed on centralized exchanges, they have already made a lot of money this round. They do not need any income, for example, some zk projects, after the airdrop, only have a few hundred daily active users on-chain, but it doesn’t affect their market value of tens to hundreds of billions, and market makers happily help the team sell tokens. Some high-control DeFi tokens, all are gamefi tokens with few active team members, are in a similar situation. These are the tumors of the cryptocurrency market, constantly sucking blood. The manipulation teams behind these tumors are also accomplices who have made money. It’s ridiculous that some time ago, I saw someone boasting on Twitter about how much money the manipulation project had made, this kind of spectacle is unique to the cryptocurrency market.
There are also some, such as quant teams, etc., who have made some hard-earned money, I won’t list them all, if anyone has more discoveries, feel free to reply in the comments section to make me jealous.
However, through the analysis above, consider building a cryptocurrency portfolio that will always make money, mainly holding assets from categories 1-4 and avoiding 5.