Author | @0xBenniee

Original title: "On-chain Alpha Game: A Unilateral Game Directed by Market Makers?"

In the current market environment where liquidity is still insufficient during the interest rate cut cycle, Binance Alpha's bull market continues to unfold: an unknown project can often quietly achieve several times the increase in value in a short period of time.

This article will discuss the market-making strategy of the first Alpha + Perp from the perspective of a market maker, and use the inner monologue of mm to "dance with the market maker".

Binance Alpha is equivalent to a natural liquidity pool. On the first day of its launch, it can attract huge attention and retail resources, and at the same time attract a group of native Alpha users to participate in transactions - they may choose to sell and collect their wages, or they may be optimistic about continuing to hold or increase their positions. Every "Alpha worker" is betting from his or her own perspective.

But if we switch to the perspective of the project party and the market maker, their inner thoughts are actually more direct: I have paid 1-2% of the chip cost to launch Alpha, and also spent extra money to open Perp. After paying so much "protection fee", the probability of abandoning the market later is low.

This led to the subsequent "Alpha on-chain bull run." In reality, it's difficult to achieve large-scale distribution relying solely on the Alpha spot market. Market makers and dealers must leverage Perp to continuously increase OI to attract more retail investors, turning the market into a "casino" to keep gamblers coming.

Today's project logic is no longer the "narrative-driven" one of the past. It has completely transformed into capital-driven: whoever has more chips can create a more powerful market; as long as there are enough gamblers entering the market, market makers can continue to create fluctuations and reap profits from them.

Summary

• Alpha provides a natural pool of attention and initial user base;
• Perp is the core tool for dealers/market makers to increase OI and attract traffic.
• For market makers, the key logic on the first day of listing is:

Alpha → Accumulation + Position Building;

Perp → Pump up + distribution.

Taking the first issuance of a new coin as an example, let’s see how market makers make profits through Alpha+Perp.

Alpha goes online at 8:00 (UTC), and Perp goes online at 10:30, leaving market makers with only a two-and-a-half-hour window to collect their shares. This period is essentially the stage where market makers and retail investors compete for shares. Active market makers will bite the bullet and take the shares. If these shares are snatched up by a large number of free-rider retail investors, the subsequent market maker's cost of pumping the market will increase. A good market maker will strive to control their costs to maximize profits.

(From the market perspective, the main market-making force on Alpha is mainly active MM. According to general industry speculation, their allocation scale is usually in the millions of US dollars, and the liquidity supply on the spot side is relatively sufficient.)

After Perp launched, market makers will attract more retail investors by driving up open interest (OI), turning the game into a "gambling table that gets more lively the more you sit." Perp's core role isn't simply to provide hedging tools, but to amplify market attention and trading participation.

At the same time, market makers/project owners often collaborate with relevant KOLs to promote favorable news or market PR related to exchanges, further generating buzz and attracting more attention. Whether going long or short, this essentially contributes to market liquidity, providing market makers with greater room for maneuver and a more profitable source of profit.

As shown in the chart, after Perp went online, OI quickly surged and remained stable at a high level. In the early stages, market makers typically avoid selling shares through sharp price increases or crashes. This is because premature price crashes make it impossible to redistribute the chips at the same or even lower cost, which in turn increases their overall price manipulation costs. The market makers' core goal is to deliver the chips to retail investors as quickly as possible at the highest possible price, ensuring a smooth distribution.

During price movements, funding rates often provide a key indicator. By observing changes in funding rates, market makers can determine whether market sentiment is overheating and make detailed optimizations based on this information. For example, when funding rates surge abnormally, market makers can use spot-futures hedging or short-term funding rate arbitrage to reduce their holding costs and further improve overall returns.

The spot market is entirely in the hands of market makers. As long as the market makers do not dump the market, through the funding rate market, during the 9/12-9/15 pull-up phase, OI continued to increase and the funding rate soared several times.

Peak: 0.3–0.4% / 4 hours (approximately 270%–360% annualized);

Average: 0.1–0.2% / 4 hours (approximately 90%–180% annualized).

This means that by establishing hedging short positions in the contract market and taking delivery in the spot market, market makers can continue to earn funding rates and form a stable arbitrage cash flow, which is an important means of optimizing costs.

On September 16th, when OI remained high and long positions were heavily overstocked, the market makers chose to significantly dump the market, distributing spot profits while short positions were profitable:

The price dropped from 0.058 to 0.035, a drop of about 40%;

The dealer's cost range is 0.015–0.02, and the average delivery price is about 0.045–0.05;

The profit margin for a single transaction is approximately +150%–200%.

(Ideally, the income from the on-chain liquidity pool is not included in the overall calculation. The specific strategies of different market makers are also quite different.)

Several key points of dancing with Zhuang

1. In the early stages, projects with high market control or high community FUD often deserve more attention. However, Grand Slam projects are more difficult to deduce due to their complex chip structure, so users should participate with caution.

2. If Alpha and Perp are launched simultaneously on the first day, it usually means sufficient liquidity and more drastic price fluctuations.

3. Users can try to estimate the market maker's profit during each wave of rise and fall, which helps to understand their trading logic.

4. When Alpha opens, pay attention to the pricing of Pancake V3. If the opening price is too high, it may be safer to wait for a more appropriate price and rhythm.

Conclusion

Binance's Alpha+Perp launch model is reshaping the current IPO market. On the surface, this appears to be a narrative-driven bull market for IPOs, but in reality, it's more like a structured game orchestrated by market makers. Alpha provides chip accumulation and initial traffic, Perp amplifies liquidity and volatility, and OI and funding rates become key tools for market makers to manipulate the market. As retail investors, we may be able to seize short-term opportunities, but it's more important to understand the underlying logic: the extent of a market's trajectory depends not on the compelling narrative behind it, but on the depth of its funding and the precision of its timing.