The truth behind the sudden wealth of the local dog: Who is making money, and who is taking the fall?

On-Chain Hotness and Retail Illusions

Recently, the hype on the BSC chain has been exploding, with new projects emerging daily, scam tokens flying everywhere, and stories of overnight riches playing out every day. Buying into a project before bed and waking up to double your wealth—these scenarios frequently appear in group chats. Many retail investors are attracted by these stories, abandoning fundamental research and paying less attention to the secondary market, only thinking about whether they can find the next 100x coin in the primary market.

But have you ever thought about a question: whose money are you earning?

The market operates on the 80/20 rule; there is no scenario where everyone benefits. Those profit screenshots you see are either the result of wash trading or only show the gains, not the losses. Institutions need these myths of sudden wealth to exist; they continuously attract retail investors into the game.

Smart Money Has Already Quietly Shifted

While most people are still dreaming of “life reversals,” the truly smart money has already quietly exited. They are not continuing to participate in scam tokens but are quietly reallocating most of their funds back into the secondary market—focusing on more liquid, higher-confidence main assets like BTC and ETH. At most, they keep some small amount in the primary market to continue gambling.

By the time retail investors realize that the “golden dog” projects on-chain have turned into “dead dogs,” they often have already missed the best timing to chase mainstream coins. Those who got rich early through project hype have long since swapped their chips for Bitcoin and Ethereum.

Who ultimately profits? Institutions, KOLs, and project teams.

The Truth Behind the Profit Chain

Institutions team up with numerous KOLs to issue tokens, closely monitor influencers’ every move, and ride the wave of individual traffic. They might release hundreds of new projects in a day, most likely created by the same group of people. As soon as one project catches on, many KOLs swarm in—buying early and then tweeting to boost it. Technical teams leverage tools to front-run for profit, with retail investors following suit.

By the time ordinary retail investors see it, the project has already surged at least 100x. Early entrants might still lose less, but later ones become tools to lift the wash trading. Don’t talk about fair launches; if an ordinary person issues a project and tries to ride the hype without KOL support, no one will pay attention.

Although some retail investors follow the trend and make a little profit, project teams are not worried—they fear that you won’t continue playing. Most retail investors, after making a small profit, will turn around and lose everything on other projects. In the end, you realize that after playing with institutions for so long, all your hard-earned funds have turned into others’ Bitcoin and Ethereum wallets, while your previously accumulated scam tokens have already gone to zero.

The Game Behind Ecosystem Hotspots

There is a logical reason behind this phenomenon. A leading exchange, as the main participant, holds the most ecosystem tokens, first pumping up the price to create hype and make the ecosystem the center of attention; then, they team up with KOLs to create myths of scam tokens getting rich quickly—stories of thousands turning into millions spread across the internet, attracting more people to enter; KOLs praise and hype, creating the illusion that “everyone can get rich.”

Meanwhile, those with prepared funds start to sell at high levels, steadily passing the baton to the last entrants.

Retail Investors’ Correct Approach

As a retail investor, if you lack the technical advantage of being ahead of the curve or reliable inside information, it’s best not to get involved. Wealth is never built overnight. Those who truly achieve financial freedom usually go through several bull and bear cycles—accumulating during volatility and holding firm at lows.

Mainstream assets like BTC and ETH are the tools that can sustain wealth over the long term. Going all-in on scam tokens is less effective than strategically positioning in assets with real value.

Scam projects might make some pocket money, but the myth of “10x, 100x” wealth belongs to only a few. Most will end up losing everything in this game. Even if you do make a profit from a project, if your wealth is not well-positioned, you will eventually lose it back with your own strength.

The Direction for the Next Cycle

Currently, the wealth creation myth on BSC has reached its climax, and the next wave of investors may be lining up. After this scam token craze subsides, the market’s focus will likely return to mainstream assets. The next trend may not be on BSC but in Bitcoin and Ethereum.

I cannot stop everyone, nor do I want to block wealth opportunities. I just want to remind everyone: stay grounded, don’t let greed cloud your judgment.