Dragonfly Partner Haseeb: Letting Users Liquidate is Bad Business
Dragonfly Managing Partner Haseeb Qureshi stated in a podcast that the most critical aspect of operating such businesses is customer retention; if users are allowed to lose all their funds due to poor decisions, the business will quickly fizzle out as the funnel cannot replenish itself. He compared meme coin trading to financial entertainment: it can exist, but users must play with appropriate amounts, rather than losing all their funds in the first week, or else the application's half-life will be very short.
He agreed that meme coins will not disappear and may not be the endgame, as there could be future social trading of ordinary tokens, stocks, or productive assets. He believes the social attributes of trading are profound: social graphs once existed on Weibo-like platforms and group chats, but have now extended into products like fomo, with this stickiness almost inherent to the behavior itself. The discussion backdrop included fomo's co-founder explaining how a transparent social graph has made it a major application on the Robinhood Chain.
Public research indicates that fomo has approximately 400,000 users and has accumulated about $2.6 billion in transactions since its launch in early 2025, with around $12 million flowing in through Apple Pay fiat. Social trading defaults to public positions and holding times, making it easier to judge whether to trade, and creates asymmetry between top traders and followers: early participants enjoy the liquidity of later ones. The average holding time in meme trading has already been compressed.
Haseeb places casinos, mobile games, and social trading under the same operational logic: retention precedes transaction fees. If a platform relies on users liquidating to extract fees, the customer acquisition cost will exceed the lifetime value. He frames "appropriate amounts" as product responsibility rather than banning memes. He leaves the endgame open, only locking in the social layer without reverting to purely anonymous blockchain explorers.
In market mechanisms, this is retention versus fee extraction. Buyers are users treating trading as content; sellers are social trading applications surviving on spreads and fees. Funds flow from fiat to on-chain transactions. Beneficiaries are platforms that can control the pace of individual user losses; under pressure are purely following traders who rely on weekly liquidations to replace users, as well as users in the back row who are treated as exit liquidity. The event is driven by podcast discussions.
On a supplementary note, the $2.6 billion in transactions is not profit. A transparent social graph does not automatically eliminate the temptation of multiple wallets.
Source: Public Information
ABAB AI Insight
The survival of crypto consumption applications lies in their half-life, not in weekly transaction volumes. Haseeb clarifies with casino terminology: if customers lose everything in the first week, they won't be able to replenish the queue outside. Memes are the current skin, while the social graph is the skeleton. Public positions turn followers in group chats into products, and the exit liquidity of KOLs into a default structure. For platforms to survive, they must separate entertainment budgets from total wealth; otherwise, before regulation arrives, natural attrition will drain the funnel.
The capital path is "Recharge - Social Feed - Fees - Retention." Venture capital invests in applications that can turn trading into an information flow, not just single meme issuances. Money flows from Apple Pay into applications on the Robinhood Chain. The motivation is to prove that crypto consumption can have a lifecycle, making it easier to connect with traditional brokerage chains. Dragonfly holds multiple types of tokens, and its statements reflect operational philosophy, not just a single project pitch.
In contrast to Robinhood turning options into a game, and mobile games limiting in-game consumption: both discover that unlimited betting can kill the user pool. The industry phase has shifted from anonymous dogcoin terminals to visible social graphs. Control lies with those who can display holding times and limit the betting size of following traders.
Structural changes signify a transfer of pricing power. The mechanism is: when trading becomes content to pay attention to, fees shift from spreads to attention and following relationships; if platforms do not restrict liquidations, attention will be exhausted all at once, and pricing power will revert to the next new application. Thus, retention becomes a harder business constraint than fee rates.
ABAB News · Cognitive Laws
- Allowing users to lose everything in a week will kill the funnel before the market.
- Memes can change skins, but the social graph of trading is hard to remove.
- Financial entertainment can charge fees, provided that customers return tomorrow.