Original Title: "Decoding the KOL Round: A Wealth Experiment Enveloped by Traffic"

Original Authors: Viee, Biteye

Once upon a time, the play in the primary market was relatively clear: VCs provided funding, KOLs voiced out, and retail investors provided liquidity.

But today, this play seems to be disrupted.

A VC's endorsement is no longer omnipotent, and project teams are starting to redesign the game rules around "influence." KOLs are no longer just mere traffic roles. They hold the chips, step into the game, and can even determine the life or death of a project.

To some extent, the KOL Round is a token distribution method born under the narrative of "influence first" after VCs exit and retail investors lose their voice. In the past 7 days, XHunt statistics show that there have been as many as 3860 tweets mentioning "KOL" in the crypto community, while "VC" has 3078, signifying a quiet battle around influence.

This article does not talk about grand theories but only tells the real story behind the KOL Round—where it came from, who is laughing, who is crying, who is counting money behind the scenes, and who is losing sleep in the wee hours.

01 How Did the KOL Round Step into the Center Stage?

Let's rewind to the end of 2022.

The crypto VC winter has arrived. Primary market valuations are inflated, exit cycles have lengthened, and the secondary market cannot absorb the supply. Big institutions are hesitant to act, and small projects struggle to raise funds.

On the other hand, retail investors have quietly returned. Blast, ZKsync, Friend.tech... Behind every liquidity surge is a signal of the retail investors' return.

What influences these people the most is not institutional research reports but those KOLs who seem to "know their stuff" and are actually "marketing."

Project teams have also understood this: VCs may not necessarily help me break out, but KOLs can. Instead of spending money on advertising, it's better to stuff low-priced chips into the hands of KOLs, have them tweet, and set the rhythm.

Thus, a new play was born:

· Project teams extend credit to KOLs, sometimes at a price even lower than VCs;

· KOLs aggressively shill before TGE, creating FOMO;

· At the unlock moment, traffic explodes, and KOLs cash out and exit.

The KOL Round is here. You can think of it as a "task-based private sale." Low price, fast unlock, and even a "guaranteed allocation clause."

The project team has it all figured out: give tokens to those who have fans and influence, and after launch, they will naturally bring people to drive up the price.

KOLs also see it as a good deal: get tokens at a low price, bring some traffic, sell a portion after unlocking post-launch. It sounds like a surefire way to make a profit.

But is reality really like that?

02 The Truth About the KOL Round: Some Strike It Rich, Some Fall to Zero

2.1 The Profit and Loss Ends of the KOL Round

The profit and loss performance of the KOL Round varies widely depending on the project and market conditions.

In a bull market, the KOL Round is often seen as a "triple win": the project receives funding, KOLs get in early at a low price, and retail investors can also make some gains riding the wave. But when the market turns bearish, the script changes completely.

With liquidity drying up, post-launch price drops become the norm. KOLs, unable to sell due to lockups, are at risk of heavy losses. KOL @realChainDoctor once admitted that he invested in over ten KOL rounds last year, none of which were profitable, and some didn't even receive any tokens. And in the view of Master Pan @kiki520_eth, there may be some systemic traps in KOL rounds, where participants may not receive tokens, or if the price rises, the rules might be changed.

Top-tier KOL @jason_chen998 stated that his most profitable investments were in Aster and Mira. He acquired them at a relatively low valuation during a bearish market phase, with trustworthy project teams, and the Token Generation Event (TGE) happening right at the start of a bull market. Therefore, the key to making money in KOL rounds lies in laying low during a bear market and leveraging connections to get into projects. However, he also admitted that most KOL rounds are simply high-yield financial management, where if you're lucky, you make some gains, but if you're unlucky, you end up working for the money, being pushed by the project team for content, having tokens withheld, or facing delayed unlocks, ultimately leading to a falling out.

We reviewed some recent KOL round cases of projects, and some were indeed able to generate high returns, such as:

· Aster: With the token price breaking $1.79, the highest floating profit of a KOL round exceeded 70x. If we consider only the 30% already unlocked at listing, the profit was 21x, equivalent to a gain of 105,000 U for an initial investment of 5,000 U.

· Holoworld AI: Lookonchain observed that the on-chain address 0x3723, suspected to belong to a KOL investor, received about 10.24 million HOLO tokens in September at a cost price of just $0.088. Subsequently, these tokens were gradually sold at an average price of around $0.6, with total earnings exceeding 4.71 million U, resulting in a single-round ROI of over 444% and a net profit of over 4 million U.

· WalletConnect: After the token unlocked, ICO and KOL round investors only received about 1.5 times the return.

However, many projects that had a KOL round previously experienced a price collapse after listing, or the project team encountered issues.

A typical example is SatoshiVM in early 2024, where the project's token $SAVM relied on a large number of KOLs for hype during its launch, reaching a high of over $11 at one point. However, news soon spread of KOLs cashing out at the peak, triggering a trust crisis, and the project slowly lost its momentum. KOLs and retail investors who did not sell are estimated to have a hard time profiting, and currently, $SAVM has fallen to about $0.075.

Another example is ZKasino, where KOLs participated in the funding and promotion, and the project team unilaterally changed the rules and took away the assets after users completed the lock-up. In this incident, KOLs who participated in the funding and promotion were condemned by fans as accomplices, suffering not only financial losses but also facing immense public opinion pressure.

A few months ago, Eclipse was launched, with the KOL round being valued as high as $6 billion and the Series A valuation at $10 billion. However, after going live, the actual circulating market value was only about $3.8 billion, far below the rumored $6 billion valuation. Researcher KOL @_FORAB stated that some of Eclipse's KOL round allocation was even distributed to the media and community, and the project didn't even make it onto the Binance Smart Chain.

In response, renowned KOL @yuyue_chris once tweeted that the real issue with the KOL round is not losing money but rather the project team and intermediaries using the KOL round as a means to promote and attract people to buy in, allowing KOLs to use their fans to redeem their principal. This kind of insider-trading play is the most irresponsible.

2.2 Behind the Returns: The Triangle Game of Projects, KOLs, and Retail Investors

As mentioned earlier, the KOL round reflects the change in the power structure of the entire primary market.

In the past, projects relied on VCs for funding, and VCs relied on their influence to screen projects. Now, the project teams find that KOLs are cheaper, faster, and better at creating hype.

VCs are unhappy: They invested millions of dollars, and now the project team lets a bunch of low-cost influencers come in, whose influence may even be greater than their own... So some VCs choose to "exit."

Retail investors are even more dissatisfied: In the secondary market, they buy tokens dumped by KOLs after unlocking, and what they see on the day of listing is the KOLs shilling, but in reality, they are selling off.

The project team may not be happy either: because KOL's hype is often a short-term behavior, the volume, liquidity, and high opening on the launch day do not necessarily represent the project's long-term trend.

Thus, on the stage of the KOL cycle, a tense triangular relationship is formed.

· KOL is calculating: How can the invested money and reputation safely exit?

· The project team is thinking: Can the allocated amount bring the expected volume and price increase?

· Retail investors are asking: Is following this time an opportunity or a trap?

The interests of these three parties, like forces in three different directions, tug at each other. Unless the project itself is strong enough to securely attract the three forces like a magnet, any excessive force from any party may cause this triangle to collapse completely.

03 The "Middleman" You Can't Ignore—Agency

In the KOL cycle, project teams often do not directly interact with KOLs, but rather distribute and manage through a third-party Agency.

They are the "resource allocators" in this game. They help design KOL cycle terms for the project team (price, allocation, unlock); select and invite suitable KOLs; supervise progress to ensure content delivery. Some reliable agencies also design mechanisms such as guaranteed income, promotion rewards, or capital refund to help KOLs reduce risk.

They are the "intermediaries" in the entire KOL cycle system, holding both traffic and resources. So if you are a newcomer KOL and want to participate in the KOL cycle, the first thing is not to find a project but to find the right Agency.

You may have heard of the following Agencies:

· LFG Labs (@dubailfg): Founded by @snow949494 (XHunt Chinese Ranking 134) focusing on China, Japan, South Korea, and the Middle East, mainly connecting with head projects, adept at integrating KOL resources, content dissemination, and KOL cycle financing linkage.

· JE Labs (@JELabs2024): Founded by @0xEvieYang (XHunt Chinese Ranking 244) established in 2024, mainly building brands and communities for early high-potential projects, connecting with the Chinese audience, helping projects from 0 to N.

· BlockFocus (@BlockFocus11): Founded by "Er Gou" @CryptoErgou (XHunt Chinese Ranking 469) was one of the earliest to enter the Agency business in the Chinese region. BlockFocus emphasizes project value precipitation and medium- to long-term operation.

· Shard (@ShardDXB): Founded by @ciaobelindazhou (XHunt Chinese ranking 784), a marketing agency incubated by a crypto investment fund, focusing on providing strategic narrative and global growth services for Web3 infrastructure projects, covering key markets in multiple languages such as Chinese, English, Korean, Japanese, and Russian.

· XDO: Led by a prominent figure with years of market experience, primary investor @mscryptojiayi (XHunt Chinese ranking 213), preferring to focus on a few high-quality projects. They handle everything from mechanism design, strategic consulting, and market narrative shaping to execution.

· Mango Labs (@MangoLabs_): Founded by @dov_wo (XHunt Chinese ranking 112), specializing in Chinese marketing and KOL engagement, providing a full range of services from narrative creation to community management for projects.

· Cipher Dance (@Cipher_Dance): Founded by @Jeffmindfulness (XHunt Chinese ranking 2178), focusing on Pre-TGE stage content marketing, excelling in creatively amplifying project narratives and utilizing multilingual KOL engagement.

· 4XLabs: A "Strategic Advisor + KOL Matrix" helping global projects achieve 0→1 growth in the Chinese market. Team members include @jason_chen998 (XHunt Chinese ranking 34); @Bitwux (XHunt Chinese ranking 24); @Phyrex_Ni (XHunt Chinese ranking 8); @KuiGas (XHunt Chinese ranking 31).

04

How to Get the Attention of Projects/Agencies?

Typically, projects or agencies allocate budgets based on KOL influence metrics (such as follower count, past tweet engagement, etc.) and clearly define content output and unlock requirements.

To secure a KOL slot, the key is to enhance "Content + Data" and build a trusted personal brand:

· Consistently produce professional content: Maintain a publishing schedule of market analysis, on-chain data insights, or project evaluations, providing valuable content.

· Actively engage on Twitter: Interact with projects and other KOLs, participate in AMAs, live streams, tweet discussions to increase industry engagement.

· Utilize data optimization tools: Enhance account visibility using analytics tools, such as @xhunt_ai to view your account's influence ranking, capability model, engagement metrics, etc., and tailor content creation accordingly. XHunt has also introduced evaluation systems like the "Soul Index," becoming a crucial reference for many projects and agencies when assessing KOLs.

· Multi-channel Connection Establishment: In addition to online promotion, you can also participate in offline industry events or hackathons to meet project teams.

05 How to Screen Projects for KOL Rounds?

A KOL round is not charity; every participant faces pressure to see a return on investment. Choosing the wrong project not only results in losses but also tarnishes reputation, affecting the interests of regular users. Therefore, before collaborating, it is best to conduct a systematic screening process similar to investing in private sales. Focus on the following key aspects:

· Valuation and FDV: Is the overall project valuation reasonable, and is the KOL round price offered at a relative discount.

· Unlocking Schedule: Is the TGE unlocking ratio and linear schedule healthy, and is there a risk of centralized selling pressure.

· Capital Background: Check for top-tier VC investments and assess if the institutional lineup provides an endorsement effect.

· Participation Lineup: Which top KOLs have participated, and is there a signal of institutional and individual joint participation.

· Agency Source: Understand if the agency responsible for matchmaking is professional, review their track record, and see if they have participated in high-quality projects.

· Team Reputation: Does the founding team have previous project experience or industry reputation, and is there any history of controversy.

· Terms and Conditions: Are there requirements for pre-approval of promotional content, or are there special arrangements such as guaranteed minimums or coin return clauses.

Additionally, you can also use tools like XHunt to analyze the reliability of a project. Use the plugin to view funding information, team information, follower counts of KOLs in Chinese and English, community sentiment, and the project's influence ranking.

06 Conclusion: KOL Rounds, a Narrow Door to the Primary Market for Ordinary People

Looking from a higher perspective, KOL rounds are a financing tool that has naturally evolved in the crypto industry under the backdrop of prioritizing traffic, emphasizing narratives, and community-driven initiatives.

It lowers the financial barrier to entry, accelerates dissemination, and indeed helps some small projects stand out without VC support.

Of course, KOL rounds sometimes suffer from a lack of standards and blurry responsibilities. However, looking from a different angle, this may also be one of the few opportunities for retail investors to "squeeze into the primary market." Compared to traditional private placements dominated by elite VCs with high information barriers, KOL rounds at least have a certain level of liquidity and openness. Anyone, as long as they can consistently produce content and have influence, may have the opportunity to receive an allocation and truly participate in the primary pricing game.

This is not a perfect mechanism, but it is the current "homegrown solution" in the native cryptocurrency capital market. In a stage where the rules are not yet formed and the trust mechanism is still being built, the Key Opinion Leader (KOL) rotation, as a new market solution, still makes sense.

Because in this era, influence itself is a new form of capital.

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