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Table of contents

1. Problem
2. Solution
   1. Prisoner’s Dilemma
3. Implementation
   1. Architecture
4. Questions

Intro

Skill Issue products are developed by FirstMate Labs, Inc. which is funded by Dragonfly Capital and Coinbase Ventures.

Problem

The proliferation and formalization of memecoins over the previous months has surfaced some fundamental problems that exist for traders in this market. Currently, memecoin markets could be modeled as a game where each holder wishes to hold a token for as long a period as possible, to maximize their returns. However, they must sell before others do to realize their returns.

This dynamic has increased the speed of these markets and reduced the longevity of the assets created — holders are incredibly sensitive to even modest selling by others, which can create a cascade of sales over a short period of time. This occurs when the developer of the project or large holders are seen to be selling.

The greatest risk that exists for a memecoin and its community of holders, is that a large holder will sell their tokens at an inordinate time, to the benefit of the seller and at the expense of other holders, resulting in a cascade of other sales. The mere threat of this possibility hangs over prospective traders and prevents them from participation.