Dumpy.fun update #2: Squeezy.lol launches + The Arena
If you haven't read my introduction post about dumpy.fun then start there
https://www.bulbapp.io/p/66bb0237-e088-477b-a03c-c9eba77f053b/shorting-coins-on-solana-its-complicated?s_id=58fb1a56-2c60-4871-bfcc-9b01acbc25b5
What's been happening in memecoin land?
It's been carnage out there in the markets. Everything is down bad. Even the great BTC keeps falling.
Of course the hardest hit have been the memecoins. 
Now, it would seem, is a golden time to building out a memecoin shorting platform.
dumpy.fun has been adding more tokens to it's roster since our last post and they've all been solidly memecoin territory (no more ETH and W style stuff).
squeezy.lol debuts
For those of you familiar conspiracy theories, the term 'short squeeze' has taken on a life of it's own in recent years.
Mostly it's pure nonsense.
But the core concept is solid. We see it in crypto all the time due to the 'wild west' nature of these markets. A phenomena called 'cascading liquidations' (most commonly seen for price falls https://crypto.ro/en/dictionary/cascading-liquidations/) can see large movements up or down in markets due to positions held with leverage triggering stop loss thresholds.
The idea of a short squeeze is that a price movement upwards forces leveraged short positions to liquidate and thus buy.
The vast majority of positions in crypto are Long, that is people holding crypto. And the vast majority of them are un-leveraged. So these don't factor into market movement at all as they're not actively traded.
The majority of leveraged position are still Long. So it's much more likely to see liquidations cause price falls, rather than price spikes. However with the introduction of easy to use leverage products like dumpy.fun and others we will see an increase in the number of leveraged short positions.
Into this arena steps the sister act to dumpy.fun: https://squeezy.lol/
And it's as simple as dumpy.fun is.
Find the memecoin you want to hold.
Deposit it into squeezy.lol
And... you're done.
You take on almost exactly the same risk as you would holding it in your wallet (albeit with added smart contract risk that anyone takes on interacting with any platform).
The yields are very good for tokens that had zero lending opportunities prior to this.
But of the course the risk is what the risk has always been with these things: Price go down. And the price has cratered for most of these tokens.
But if you're holding a bag of one or more of these tokens AND you're intent on riding it out, why not pick up a yield whilst you're doing it?
So where we aping this time?
We're dumping TRUMP (Wormhole version) and SCF
We're longing (squeezing?) MOTHER and JASON.
Why?
Why not.
The Arena launches
Seeing Save Finance (aka Solend) have all the fun is not what MarginFi is all about.
For context: There has been a long running serious of disputes between these teams stretching back pretty much to the launch of MarginFi on Solana.
MarginFi just recently launched The Arena https://www.thearena.trade/
It's basically the same idea but with a few important caveats.
The Arena offers two products:
- Perps (Discover)
- Deposits (Yield)
Discover aka perps
This is your standard perps product. You can Long or Short tokens. It's pretty good, of course you don't get great spreads on these things (as they're super volatile and low liquidity) but then again you couldn't get perps on nearly all these beforehand so: beggars can't be choosers.
The difference here is with squeezy.lol.
On squeezy.lol you deposit your tokens and earn a yield with no liquidation risk. Here you're taking a Long position when you deposit tokens which means you can get liquidated.
That's why this isn't the only product The Arena offers...
Yield aka Deposits
Yield is The Arena's answer to squeezy.lol. You can deposit either USDC or a token and earn yield from the pool that's been set up to facilitate the trades.
As you can see the USDC lend rates are far higher than the other token rates.
It's part of the plan by MarginFi to eventually make the creation of markets on The Arena completely open to anyone to set up https://mrgn.substack.com/p/welcome-to-the-arena
So where are we aping on The Arena?
We're shorting HMTR and longing WIF and MOTHER
On the Yield side we're depositing USDC in the KAMA and POPCAT LPs
What is your strategy in the current memecoin market?
Are you positioning yourself for more carnage in memecoins or are you betting on a rally?
Or have you got a foot in both houses?
Let me know in the comments!
