DWF Labs’ official website previously stated that “regardless of market conditions, DWF Labs invests in an average of 5 projects per month.” Since March, DWF Labs has indeed been buying up 5 projects in the secondary market on average per month, sparking heated discussions in the community. Some believe that DWF is not really investing and is only taking coins for market making. DWF Labs partner Andrei Grachev also responded, “In addition to investment, we usually bring additional support,” which is considered to be a tacit acknowledgement of this “investment + market making” compound operating model, and the official website also directly puts up a sign that provides such services.
DWF Labs clearly states that it is a global digital asset market maker and a multi-stage web3 investment company for project development, and is engaged in high-frequency cryptocurrency trading. It is currently trading in the spot and derivatives markets on more than 40 top exchanges. DWF Labs also mentioned that DWF can provide cutting-edge market-making execution capabilities, create trading volume for projects as a service, and provide healthy liquidity. Currently, they have integrated with the top 40 trading platforms and trade more than 800 currency pairs, including spot and derivatives.
Through market making, DWF said it can allow other market participants to trade the project's tokens with less price impact, which can increase market depth and make investors more confident in the market liquidity of the project.
In terms of selecting market-making currencies, unlike Wintermute which focuses on European and American blue-chip projects with good fundamentals, DWF Labs mainly targets East Asian projects and various new and old sentiment-themed targets for market making. Many institutions and investors have begun to use YGG, DODO, C98 and other tokens as DWF Labs' market-making rules, and have begun to make investment maps of their existing layouts, as well as some currencies that have not yet risen.
There are many monsters in the bear market, the YGG tragedy
Everyone said that Gamefi was dead, but at the beginning of last month, YGG, a union project based on Gamefi, performed a "Mario jump" for everyone after it was listed on large mainstream trading platforms such as Binance, OKX and Bybit.
It increased nearly 5 times in 6 days, and then immediately fell 60% within 4 hours, causing the market to liquidate more than 10 million US dollars.
Although there is no direct evidence that DWF participated in this pull-and-smash activity, the on-chain wallet marked as DWF by multiple on-chain institutions did receive YGG tokens, and DWF did co-lead YGG's $13.8 million financing in February 2023 - by selling tokens. In February 2023, DWF Labs and a16z led the investment in the blockchain game guild YGG, which raised $13.8 million in funds by selling tokens.
Starting from August 6, DWF Labs released news about funding decisions of YGG, DODO, and C98, which prompted the three currencies to continue to rise after they had already risen. Among them, YGG had the largest increase in the second stage, close to 50%. However, all three fell back quickly after one day of trading, and YGG also had the largest drop of about 70%.
The most intuitive feeling is the recent tweet about YGG by Andrei Grachev, the managing partner of DWF. Andrei, who rarely posts, posted two tweets about YGG. The first one on August 6 congratulated YGG on its launch on Binance contracts and analyzed the trading depth and pending orders of YGG tokens.
Of course, there are still some differences between this CYBER incident and YGG. DWF does not seem to be directly manipulating this CYBER incident, but is only playing the role of moving bricks or insider trading, which is different in nature from the YGG incident.
"Pull up first and then drop", DWF's market making strategy
Although DWF has been promoting itself as a company that can protect projects from the threat of "pump and dump" price attacks and extreme price fluctuations, DWF's investment portfolio, apart from the much-criticized YGG, has seen many cases of "pump and dump" for no apparent reason.
Only one month after these projects were invested in by DWF, the "pull up and then crash" incidents occurred, taking ARPA and Agld as examples.
On April 25, DWF announced its investment in ARPA Network. Subsequently, the price of ARPA tokens increased by more than 2 times within a month, and fell by nearly 40% on the day of the highest price. During this period, the holdings of ARPA tokens on mainstream trading platforms surged, causing a large number of liquidations. The holdings returned to normal within a period of time after the price fell.
On June 22, Adventure Gold DAO announced that it had received investment from DWF, which promised to purchase AGLD tokens worth seven figures. Subsequently, the AGLD token rose nearly 2 times in a month, and fell more than 40% the day after the peak. Similarly, during this period, the holdings of AGLD tokens on mainstream trading platforms surged, causing a large number of liquidations. The holdings returned to normal for a period of time after the price fell.
Is there any chance to seize it?
In order to attract more commercial clients and project parties, DWF Labs mentioned in the "Market Making" business that "it will provide efficient and sustainable liquidity for our partners." Therefore, the similar trends of YGG, DODO, C98 and other previously market-making currencies just verify the business level and service quality of DWF Labs.
It can be seen that DWF Labs has already made markets for two of them, YGG and C98. It is just unknown whether the next currency to soar or plummet will be one of its recently invested projects.
On September 2, DWF announced its cooperation with MDT, which instantly increased its share price by 20%.
Bel transferred tokens to DWF on the chain, and it is expected that DWF will conduct market making, which also instantly increased by 20%.
Therefore, for these currencies, the source of information is very important, and the information gap is also very important. If you see DWF cooperating with a currency or making a market in the future, if it has not risen much, you should decisively get in, take a wave and leave, don't be greedy, if it has already been pulled up, don't participate again, choose the opportunity to short. If you can't grasp it yourself, welcome to join us, I will give you more cutting-edge news and more accurate points.
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