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Should We Flag Value Extractors in Crypto Projects? A Deep Dive into TGE Dumping

Hey there, crypto enthusiasts! If you’ve been hanging around the blockchain space lately, you’ve probably noticed some heated discussions on X about "value extractors" — those folks who grab tokens at a Token Generation Event (TGE) and dump them right away, hopping to the next project. One post that’s got everyone talking comes from Filip (cookie) @fwielanier, posted on July 26, 2025. Let’s break it down and figure out what it means for the future of crypto projects.

What’s the Buzz About?

Filip kicks off the conversation by asking a big question: if someone dumps all their tokens at TGE and moves on, should we label them as a "value extractor"? And if so, should their accounts get flagged or their rewards (like points in InfoFi systems) reduced until they show they’re adding real value? This isn’t just a casual thought — it’s a call to rethink how we reward participation in crypto communities.

For those new to the terms, TGE is when a project first releases its tokens to the public, often through airdrops or sales. InfoFi (short for Information Finance) is a growing trend where people earn rewards for sharing knowledge or promoting projects. The idea here is to stop "campaign hopping" — where users jump from one project to another, collecting rewards without caring about the long-term success.

The Community Weighs In

The replies to Filip’s post are a goldmine of perspectives. R2D2 @R2D2zen argues that flagging everyone might be too harsh. They point out that small allocations (like 0.2% to 0.5% of token supply) mean early dumpers don’t cause massive damage. Plus, market makers or insiders often sell first, setting the tone. R2D2 suggests we need more high-quality creators before adding strict rules, and forcing people to hold tokens could leave them as "bag holders" if the project flops.

pudgy teddy @pudgyteddy takes it a step further, saying the issue isn’t just farming points — it’s about rewarding the right behavior. Current systems often favor visible actions (like posting or checking in) over deep conviction (like researching a project). They propose an "epistemic skin in the game" approach, where rewards go to those who truly understand what they’re supporting.

Doggfather @DoggfatherCrew likes the idea of a "loyalty factor" — boosting those who stick around after TGE but not punishing everyone. They note tracking wallets can get tricky with exotic exchanges or cold storage, though.

Then there’s IcoBeast.eth @beast_ico, who flips the script. They argue the problem lies in incentive systems that stop at TGE. If rewards dry up after the airdrop, why would anyone care about post-launch behavior? It’s a reminder that project design needs to extend beyond the initial hype.

Why It Matters

This debate hits at the heart of crypto’s community-driven ethos. Projects rely on early supporters (often called "yappers" or "snappers" for their promotional efforts) to build momentum. But if those supporters cash out instantly, it can tank the token price and leave genuine believers holding the bag. On the flip side, labeling someone a "value extractor" too quickly could scare off legit participants who just need to pay bills — a point R2D2 raises about the real-world pressures in this space.

Filip’s suggestion to deboost points for hoppers aims to curb spam and encourage conviction. But as the thread shows, it’s not black-and-white. A balanced system might reward loyalty without alienating newbies or punishing those in tough spots.

What Can Projects Do?

So, how can we design better incentive systems? Here are a few ideas floating around:

  • Extend Rewards Beyond TGE: As IcoBeast suggests, keep incentives alive post-launch to encourage long-term support.
  • Focus on Conviction: Like pudgy teddy’s idea, reward deep engagement (e.g., quality content or research) over surface-level activity.
  • Loyalty Boosts: Doggfather’s loyalty factor could give a points bonus to those who hold or promote after TGE.
  • Quality Over Quantity: R2D2’s call for more creators hints at nurturing a pipeline of dedicated contributors before strict rules kick in.

Each project’s goals will shape its approach. A meme coin might prioritize fun engagement, while a DeFi project might focus on utility. The key is alignment — making sure incentives match the project’s vision and community values.

The Bigger Picture

This conversation ties into broader crypto trends. Take pump and dump schemes, where bad actors hype a token then sell off, leaving others with worthless coins. Or look at tokenomics, where supply and demand design can either stabilize or destabilize a project. Filip’s post is a microcosm of these challenges, pushing us to build fairer, more sustainable ecosystems.

Your Take?

What do you think? Should we flag value extractors, or is there a better way to reward real value? Drop your thoughts in the comments — we’d love to hear from you! And if you’re into meme tokens or blockchain tech, stick around at meme-insider.com for more insights and updates. Let’s keep the conversation going!

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