Ship or Die at Accelerate 2025: Lightning Talk: Sanctum

In a shocking reveal at Accelerate 2025, FP Lee, co-founder of Sanctum, a leading liquid staking protocol on Solana, exposed the dark underbelly of crypto token launches and manipulation. His talk, ironically titled "The Grifter's Guide: How to Enrich Your Friends and Dump on Retail," shed light on unethical practices prevalent in the industry and called for greater transparency and accountability.

Summary

Top Projects

Lulo

Score: 7,586.13

Bonk

Score: 4,806.12

Sphere

Score: 2,544.42

Moonwalk

Score: 2,026.11

FP Lee's presentation at Accelerate 2025 was a stark departure from typical crypto talks, focusing not on promoting his own project, but on exposing the manipulative tactics used by some crypto projects to artificially inflate their token values and deceive investors. Drawing from his four and a half years of experience in building Sanctum and launching its token, Lee shared insider knowledge of practices that he has either witnessed or been encouraged to employ.

The talk covered a range of deceptive strategies, from artificially inflating social media followings and manipulating token supply to orchestrating over-the-counter (OTC) deals that pump token prices. Lee emphasized that while these practices are known to insiders, they often remain hidden from retail investors who bear the brunt of the subsequent market dumps.

Lee's presentation wasn't just about exposing problems; it was a call to action for the crypto industry. He stressed the importance of fair launches, transparent OTC deals, and accountable token management. By sharing this information, Lee aims to educate investors and encourage projects to adopt more ethical practices, ultimately fostering trust and facilitating the mass adoption of cryptocurrency.

Key Points:

Deceptive Hype Building Tactics

FP Lee exposed several tactics used by crypto projects to build artificial hype around their tokens. These include buying social media followers instead of building actual products, and giving large amounts of tokens to key opinion leaders (KOLs) to promote the project. Lee emphasized that these practices create a false sense of popularity and adoption, misleading potential investors.

Another tactic Lee highlighted was the inflation of valuation figures. Some projects claim to have raised funds at billion-dollar valuations, when in reality, the actual amount raised was much smaller. This practice artificially inflates the perceived value of the project, encouraging investors to buy in at inflated prices.

Supply and Demand Manipulation

Lee detailed how some projects manipulate both the supply and demand sides of their token economics. On the demand side, projects might arrange for funds to buy tokens on the open market in exchange for discounted tokens issued directly from the project's foundation. This creates an illusion of organic demand.

On the supply side, projects may restrict token circulation through various means. These include maintaining a low circulating supply compared to the total supply (low float, high fully diluted valuation), selling large amounts to insiders who are less likely to sell immediately, or "sniping" the supply by quickly buying up available tokens. These tactics can create artificial scarcity and drive up prices.

The OTC Loop

FP Lee exposed a particularly insidious practice he called the "OTC loop." This involves three steps:

1. The project uses treasury funds to buy its own token on the market, pumping the price.
2. When the price is high, they sell tokens OTC (over-the-counter) to investors at a "discount."
3. The proceeds from the OTC sale are then used to buy more tokens on the market, further pumping the price.

This cycle creates an artificial price increase that can attract more investors, all while the project team profits from the OTC sales. Lee stressed that while OTC deals themselves aren't inherently bad, undisclosed deals can lead to market manipulation.

Call for Transparency and Ethical Practices

Lee concluded his talk with a strong call for better practices in the crypto industry. He emphasized the importance of fair token launches, large circulating supplies, and efforts to prevent supply sniping. He advocated for the disclosure of all OTC deals (after the fact to prevent front-running) and comprehensive accounting of all tokens.

Lee highlighted two projects, Metaplex and Jupiter, as examples of good practices in token management and transparency. He called for more projects to adopt similar approaches and for the community to demand higher standards from crypto projects.

Facts + Figures

• FP Lee is a co-founder of Sanctum, one of the largest liquid-staking protocols on Solana.
• Sanctum has been in development for four and a half years.
• Some projects claim billion-dollar valuations based on minimal actual investment.
• Social media followers can be bought in bulk, with offers of "100,000 followers" being common in Lee's DMs.
• The "OTC loop" involves three steps: buying tokens to pump price, selling OTC at a "discount," and using proceeds to further pump the price.
• Lee mentioned that Sanctum has never done any OTC deals or sold a single token.
• Metaplex was highlighted for using decision markets to control part of its treasury.
• Jupiter was praised for conducting regular community audits to track treasury token movements.

Top quotes

• "Ship or Die at Accelerate 2025: Lightning Talk: Sanctum"
• "The grifter's guide: how to enrich your friends and dump on retail"
• "Build hype, not product"
• "Pump the valuation"
• "Grifters give us all here a bad rep"
• "If crypto is just synonymous with a fucking cesspool, then they're not gonna want to come"
• "We can do better"
• "Demand more from your projects, call out bad actors"

Questions Answered

What are some common tactics used to artificially inflate a crypto project's popularity?

Some projects buy social media followers instead of organically growing their community. They may also give large amounts of tokens to key opinion leaders (KOLs) to promote the project. These tactics create a false sense of popularity and adoption, potentially misleading investors about the true state of the project.

How do some crypto projects manipulate their token's supply and demand?

On the demand side, projects might arrange for funds to buy tokens on the open market in exchange for discounted tokens issued directly from the project. On the supply side, they may restrict token circulation through low floats, selling to insiders, or quickly buying up available tokens. These tactics can create artificial scarcity and drive up prices.

What is the "OTC loop" and why is it problematic?

The "OTC loop" is a three-step process where a project buys its own tokens to pump the price, sells tokens OTC at a "discount" when the price is high, and then uses the proceeds to buy more tokens and further pump the price. This creates an artificial price increase that can attract more investors while allowing the project team to profit from OTC sales.

Why are undisclosed OTC deals considered problematic in the crypto space?

Undisclosed OTC (over-the-counter) deals can lead to market manipulation. While OTC deals themselves aren't inherently bad, when they're not disclosed, they can be used to artificially inflate token prices or allow insiders to profit at the expense of regular investors. Transparency in these deals is crucial for maintaining fair market conditions.

What practices does FP Lee recommend for more ethical token management?

Lee advocates for fair token launches, large circulating supplies, and efforts to prevent supply sniping. He recommends disclosing all OTC deals (after the fact to prevent front-running) and maintaining comprehensive accounting of all tokens. He also suggests using decision markets or community audits to oversee treasury management, as exemplified by projects like Metaplex and Jupiter.

Why is transparency important in the crypto industry?

Transparency is crucial for building trust with investors and facilitating mass adoption of cryptocurrency. When projects are open about their token economics, deals, and treasury management, it helps prevent manipulation and allows investors to make informed decisions. Transparency also helps distinguish legitimate projects from those engaging in unethical practices.

How can the crypto community combat unethical practices?

The crypto community can combat unethical practices by demanding more transparency from projects, calling out bad actors, and supporting projects that demonstrate good practices. Investors should be educated about common manipulation tactics and should scrutinize projects carefully before investing. The community can also work together to develop and promote standards for token transparency and ethical management.