Author: Ltrd
Translated by: Tim, PANews
"Show me the incentive mechanism, and I'll show you the results" is a famous quote by Charlie Munger. Incentive measures are equally visible in the market, where exchanges can favor specific market participants by establishing specific fee models, indirectly affecting spreads and liquidity. They can also provide corresponding value loans based on liquidity scale to incentivize market makers to provide more liquidity. The possibilities are endless, but the key is understanding which incentive mechanisms are needed to attract attention and achieve goals.
<After the large-scale airdrop by Hiperliquid, traders were eager not to miss opportunities, which was particularly evident in the Binance Alpha 2.0 upgrade. As the pre-listing section of Binance exchange, this platform specifically incubates emerging tokens with potential that have not yet listed met the main site's.2version breakthrough introduced a bidding trading mode, providing an unprecedented liquidity entry for early-stage projects.
p are not here to discuss Binance Alpha's auction function or other other features today. I want to tell a story about how aboutive F, potential future returns can breed various abnormal phenomena in the market.Binance Alpha points, the core element of this article, can be obtained by users through trading activities on the the the binAlpha platform. Users can earn points by volume or by holding tokens, but trading volume points seem to play a decisive role. These points can be used to participate in Alpha series activities (such as airdrops or TGE). Historical data shows that tokens associated with Binance Launchpad often perform excellently, so the project'siveness significant. Given the uncertain scale of potential returns, many traders are rushing to collect points, expect expecting substantial rewards.
>to the key point. The is simple: points users need to generate trading volume to to obtain points. is that we see tokens related to Binance Alpha have surged trading trading volumes. Meanwhile, the market also presents abnormal volatility patterns extremely rare under normal conditions.Take Bedrock BR) currently the hottest token onanc, with a trading volume exceeding $3 billion in the past 24 hours. Its chart shows buyers and sellers actively trading simultaneously, generating massive turnover (as shown in the 10-minute rolling trading volume below)<< This indicates that although the bedtotal trading volume reaches about $3 billion, the net difference in USDT value of buy and sell trades is close to zero. This phenomenon suggests: There are market participants executing hedging strategies with trading activities that almost produce no net position risk.
When trying to interpret the truth behind the data, especially without additional background information (on-chain data usually provides more clues, while centralized exchanges only disclose information visible to all users), you must dig into every detail: transaction amounts, transaction frequencies, outliers, market impact distribution, order sizes, etc. When unable to grasp the complete information held only by the exchange, you need to capture every detail. Let's focus on order size analysis.
The histogram does not conform to a at all. most cases, we see trading volume follows an exponential distribution, but not here. Most transactions are concentrated in the of -12k-k which is high-level in conventional standards. Such concentration should raise alerts and require in-depth analysis. It is recommended to refer to trading volume data of other assets on the BASE chain as a.
Digging deep into on-chain data can especially reveal the problem. Clearly, some abnormal situations are occurring It is highly likely that people that are trying to quickly earn points to participate in future Binance airdrops. Let's see if this hypothesis holds.
How to strategy? simple:, Conduct two-way trading, minimize losses, and accumulate as many points This is actually a smart idea. If this strategy works, we should see:: Most wallets show almost the same number of traded tokens on both buy buying and selling sides... let's sample and analyze on-chain data.
As we can see, most wallets' net net circulation indeed tends to close to zero zero. Now let's quantify specifically how many monetary units belong to this near-zero small interval.
To be honest, this result is more surprising than I expected. Over 95% of wallets participating in this token trading have net positions close to zero (meaning they bought and sold approximately the during that period). It is obvious that the purpose of such operations is to generate points while avoiding risk exposure.
I also wanted to know how many points these waltargets are.. They likely follow a strategy, studied Binance Alpha documentation, and found opportunities to impact specific point thLet's analyze the the data data.
According to my dataset, except for five outloutliers, all wallets generated 20points neither more This might be because there is no rule "points = moreird", traders just need a.
I also curious: What is the cost of generating an Alpha point? Since? Since they frequently conduct two-way trading-the same or adjacent block, causes some loss, much?
The average cost cost of Alpha points is about is about 5 5-10 cents, is not high, are still uncertain about the final return.
What I want to illustrate is: People will always hack" always trying to get the highest return with the lowest. Whether you are building an exchangeeFor a team a reasonable incentive structure is your your responsibility I hope this example clearly reveal this core point.
