加密货币正在永久走出 Bitcoin 时代——Syncracy Capital

Yo, yo. He's above Melo right now, by the way.

Yeah, he's above Melo right now.

Yeah.

He's above Melo right now, man. It's good to see you guys.

Are you a Knicks fan?

No. For the next month—

You're from L.A.

I'm a Lakers fan. I'm from L.A., bro.

Yeah.

I'm a Lakers fan. I'm a Knicks fan for the next month, you know? Party in New York, man.

How are you guys?

Welcome back. It's been a while.

Yeah, good, good, good.

Yeah.

It—go ahead.

I was just going to say, can't complain. Knicks in the finals, hype at all-time highs.

They're almost at all-time highs. It's an interesting time for you guys to come on because I think crypto is what I'm most excited to talk about: Hyperliquid, perps, all of this.

1. Crypto Sentiment Splits From Price

Crypto sentiment—we always talk about crypto sentiment. I feel like it's been a discussion for a while, and I always say it's the lowest or the weirdest, but it's in a particularly unique spot this week. You have Hyperliquid above $60—I think it's $61 right now. We were just charting your great perpification of the world on the chart, and where that was, which has played out very well since you posted that.

Hyperliquid is above $61. Zcash is trading really well. Things like VVV have done well. There are a couple of spots. Then Bitcoin is just chugging along, and everybody is just rage-quitting.

So you basically held Hyperliquid, longed Zcash, or you're ready to get carried out. I guess I'll go to you first, Ryan. We'll go to DeFi Monk, and we can just go round-table on this. What do you make of the separation between sentiment and price action? Where we are with Hyperliquid, how everything else is trading, and how everyone else is feeling in crypto—why do these two things feel so separate right now?

Yeah, you know what's funny? I think this is my third time being on here, and every single time I come on, it's always like, “Oh, sentiment is so bad. It feels so bad.” It almost feels like we're on here to give people a reason to believe. It's just funny how it happens.

But, yeah, I think one thing I've always thought about is that at some point, we're going to have some level of decoupling across the asset class—some dispersion. It's just a natural maturation process. As you start to get more sophisticated investors and higher-quality projects, especially projects whose fundamentals just aren't tied to the cyclicality of crypto, obviously you will have some things that don't trade one-to-one with Bitcoin.

Now, are we there yet? I'm not sure. But we do have things like Hype, ZEC, and VVV, which are starting to separate from the pack. It actually makes sense. In fact, I think this makes more sense than any previous decouplings have.

Let's take Hyperliquid, for example. What is actually driving a lot of the growth and volume? I saw some people today talking about how Hyperliquid fees have been relatively stable throughout the past 3 months, despite the fact that the price has gone up and volumes and open interest are going up. It's because it's all the equity and commodity stuff that is lower-margin, because you get growth mode on that, that's actually driving the growth.

The same thing with VVV. It's not at the same level as Hyperliquid, but it's a similar situation where it's just compound growth. It has nothing to do with the price of Bitcoin. It's just whether people are signing up for Venice or not. People are signing up for Venice and paying money. What the hell does that have to do with the price of Bitcoin? It doesn't have anything to do with it.

I think there's more than enough capital in this asset class that, if you have some assets that are really doing well and proving themselves, they can go up even if, as a whole, the entire asset class isn't getting a ton of new inflows.

So I think this makes sense. I think it's the beginning of what this asset class will look like moving forward: You just have to be a much sharper asset picker, because rising tides don't always lift all boats anymore.

You do have to be really sharp right now. There are a couple of spots—if you hit them, you feel great. If you didn't, you're in a brutal spot. You've underperformed, especially because the risk-reward, or I guess the opportunity cost, of trading crypto right now is high.

Mark, what do you think about our select basket of alts right now that have done relatively well, all things considered?

Oh, you're asking me?

Yeah, go ahead.

Yeah, no. I think what you're seeing right now is an asset class that has historically been populated by traders shifting toward an asset class that is more fit for an investor, and that's causing a lot of dissonance within the community.

Dude, I get it. If you're down on your BTC longs, I'm frustrated at BTC too. You're looking at semiconductor stocks putting up 10% daily candles for 4 or 5 days in a row, and you're like, “Why don't I just leave this garbage asset class and go long these other trendy momentum assets?” You can do that. I think that's perfectly fine.

But at the same time, I think there is a structural edge to having been in crypto over the last 5 years. With something like Hyperliquid, we've had—Hyperliquid has been live since 2023, but the points program really didn't start until 2024, and then it TGE'd. If you've been in crypto for multiple years, you've had multiple years of knowing what Hyperliquid is, knowing who Jeff is, understanding the story, and understanding the narrative.

Now you're seeing all of these institutions outside of crypto and all of these exogenous flows go, “Wow, this asset is a stud. I want in on this.” You, as a crypto participant, have had multiple years of knowing exactly what makes Hyperliquid so special. There are people I'm calling who are just now going through this discovery phase of understanding why something like Hyperliquid is so special.

That's a structural edge in and of itself. It sucks that it's such a low-hit-rate phenomenon, where we only have these few assets that are actually doing well. But if you're willing to lean into that edge, like we are at Syncracy Capital, and say, “Hey, look, everybody is looking at semiconductor stocks right now, but there's this asset called Hype, which we think is one of the best assets in all asset classes, not just in crypto. We think this could be a stud in equities. We think anybody who understands the narrative will be incredibly bullish on this thing,” you can flip it and view that as an edge.

Right now, there is an edge in crypto if you're just staying in here and you know what's going on. What's different from now and before is that you really need these protocols to start making some sort of real impact outside of crypto, which is what VVV and Hype are doing. I think Zcash is appealing to investors outside of crypto as well.

You've got to find a way to get your story out there beyond just the crypto circle. But once it gets there, you do have an edge in knowing what is actually going on behind these assets.

I'm more excited to talk about the upside of some of the things they're doing well rather than why everything else is so bad.

On the Hyperliquid discussion, I'll ask you, Ryan. Everyone in crypto unanimously agrees that perps are an incredible product. They're superior to what exists in TradFi, and the Hyperliquid business model is undefeated. But the valuations do start to get a little bit lofty from here, especially once you've captured everybody in crypto.

The question now becomes: What is it going to take from a storytelling perspective for the rest of retail? I think Hyperliquid has around 15,000 DAUs—maybe I made that number up, but I had that number written down. What is it going to take to convince the retail world that perps are better than options?

Do we need to go out and spearhead this? Do you want Reddit to build a new WallStreetBets? How do you actually acquire these new people into crypto? I think that's what makes the story so interesting.

Yeah, I'll actually let Monk take this one, because he's been doing a lot of work recently on Hyperliquid valuation and FDV. I think it's a good—

Also, what is the FDV that we're using? Give me that as well.

Yeah, sneak peek: We're going to be putting out a report on this soon. We've been getting this question all the time from people who aren't used to crypto valuations. They're asking, “What the hell is FDV? What the hell is circulating? What should this thing actually be worth?”

2. The Real Hyperliquid Valuation

Ballpark, right now, we think it should probably be somewhere between, if not closer to, circulating. That's a massive shift in the story, right? If all of a sudden Hyperliquid is not worth—

Can you talk through what that means for FDV and market cap, where that goes, and why you are not accounting for it?

Yeah, I've had a background in equities before, and there is no such thing as an FDV for the average stock.

The way people look at dilution is: what is dilution going to be over my investment—my forward-looking investment horizon? What is inflation going to be for shares of NVIDIA over the next few years? Then you run your valuation across diluted EPS over that time period. No one ever sits down and goes, “What is the maximum amount of shares that NVIDIA could ever issue over the entire history of the stock?”

I think now that we're introducing HYPE to this more traditional kind of investor, we need to speak on their terms. The reality is that the 40% or so of supply allocated for future incentives, I just don't think that makes sense to include in any sort of real market cap discussion.

One, we have no idea when and if that supply will ever come online. Two, if it does, I think there's a real chance that Jeff and the team decide to use it in an accretive way, where, let's say, a dollar worth of HYPE incentives generates a dollar or more of HYPE buybacks. So it's not really true inflation in the typical sense.

What is inflation really? It's probably just staking rewards, which are pretty minimal and easily offset by buybacks. Then it's just team unlocks. That's basically what you should be focusing on. We'll get more in-depth on this when we put out the report, but that's basically what I think investors should use.

Do you think there's no way we're doing another Hyperliquid airdrop, or is he just going to hand these tokens out to the community?

It's not that I don't think that's going to happen. I think it's unfair to put that into a market cap—to put that as your denominator within an overall valuation—when, one, you have no idea if that's going to happen, and two, there's a very real likelihood that this could be an accretive decision for supply.

By the way, it is a good point on stock dilution: we're not sitting here debating how much they're going to inflate NVIDIA, which is not a discussion in valuations.

Yeah, it's a crypto-specific thing, right? Because we're so used to getting dumped on by waves and waves of VC unlocks, but I just don't think that, for this specific asset, FDV really matters all that much. I don't think HYPE is worth $60 billion right now. I think the real market cap is lower.

Yeah, I think in equities there's this concept of authorized but unissued shares, right? That's just, all right, the board approves that these shares can be issued, but no one issues them. I think that is very similar to what HYPE has set aside right now for future rewards and emissions, right? This is authorized, but it doesn't necessarily mean it's going to be used at all.

At least for me personally, this is my opinion: I don't know what the team thinks, but I don't see why they would airdrop any more of this. I get it: at first, you want to incentivize people to trade. It's a new exchange, whatever. Dude, people are already trading.

Every single new product Hyperliquid puts out, people are trading it without being paid to do it. So why are you going to pay them to do it? It makes no sense. They're just going to sell it, all right?

It's a really good point. This is also one of the first times I feel like we've had a token founder who's really cared about the token price, really tried to figure out how to make this token price go up. I guess, Mark, to let you finish, what is your take on the story aspect of it?

One of the things I'm starting to see that is exciting is these more TradFi-focused stock guys. Amit Is Investing. I watch him every morning for market open. He has around 11,000 concurrent viewers. It's a lot of viewers. There's probably 300 or 400 people watching this across all platforms, and he has around 11,000 every morning.

When he came on the stream 2 months ago, maybe 3 months ago, I asked him about Hyperliquid, and he was sort of like, “Ah, I don't know crypto. I hold Robinhood, but I don't know. I've heard of it, whatever.”

[snorts]

A couple of days ago, he's posting the SPX chart on the pre-futures open on Saturday on Hyperliquid. Everyone's in the comments: “Hyperliquid, Hyperliquid, Hyperliquid.” He's posting the Cerebras pre-IPO price.

One of the things I think about, especially with the Trade.xyz ecosystem, is that there are a lot of fence-sitters. Malcolm had this point: there are a lot of people watching it, typing the URL into the browser, paying attention to the price action, but they're fence-sitters. They're crypto-curious. They're not actually clicking the trade button. They don't have a wallet, and they're not executing the transactions.

How do you go over that middle ground of the fence and convert those people? It's kind of infinite, right?

3. Converting Crypto Curious Retail

Yeah. It just goes back to the last part of the question you asked before that I didn't really get to. We broke down the great purification TAM as starting off, in the first few innings, as retail, right? That's a huge segment. We don't even need to look at institutions for now to see Hyperliquid grow its addressable market by multiples from here.

You can really think about retail as two segments. There's traditional retail—your aunt, your sister, your brother, your friend, your high school friend who's just trading stocks on Robinhood. They're going about their day and going to their job.

Then you have your sophisticated retail investor, which is either people on WallStreetBets or FinTwit. When we first started seeing the silver ticker and then the oil ticker on Trade.xyz and Hyperliquid start popping off, I started seeing a lot of these Twitter accounts from commodities Twitter and FinTwit that weren't really CT-native at all start talking about Hyperliquid, posting Hyperliquid charts, and maybe even posting slips of their Hyperliquid trades.

I think that sophisticated retail investor is going to be your first entrant. That's the low-hanging fruit. The way you get them in is simply by offering them a way to make money, which Hyperliquid is starting to do.

If you want to trade SpaceX and Anthropic pre-IPO, there's nowhere else to do that. If you want to trade oil on the weekends, there's nowhere else to do that. I think that is going to be your user acquisition funnel in the early stages, where eventually people will start to realize they're actually losing money by not trading on Hyperliquid. That's going to be the next step for how we start to convert some of these passive sideliners who could be users but are not currently users.

Down the line, I think with builder codes you can get some interesting front ends that go direct to your average retail consumer. For now, we just need to show all these people that they're losing money by not trading on Hyperliquid.

How ridiculous is it that Anthropic just raised a Series H? It's like, bro.

Yeah, I didn't—

Series H?

I didn't even know the VC alphabet went that high.

Series H is disgusting. I want to ask you this, Ryan. I don't know what percentage of your capital is allocated to Hyperliquid, but it feels like it's a lot.

One of the most difficult things I did trading—I don't regret this, but I look back and missed out on a lot of money by going so overweight Bitcoin in April 2025. We had all the scares, all the tariff scares, markets getting destroyed, and I had a lot of cash. I fully allocated to Bitcoin, which performed pretty well. We got to $126,000 from $75,000 or whatever.

But I ended up round-tripping it, and part of the problem was that I had no ability to position in anything new because I was like, “No, my Bitcoin—my spot Bitcoin—I can't trade it.” I got very attached to the position. I was so overweight, and I had no freedom or flexibility to move in and out of anything new.

So I'm curious, from a capital allocator perspective, how have you been able to be so seemingly tunnel-visioned on Hyperliquid? How do you not feel the FOMO of the semis trade, the AI trade, the photonics trade, and the metals trade when that happened, while it's all converging at the same time?

Yeah, well, the easy answer is that we just have a mandate to invest in crypto, so we can't buy semis in the fund. But even thinking for myself personally, at the end of the day there's a big opportunity cost. I even put out a tweet about this the other day. There's a big opportunity cost to doing anything versus being in AI right now.

You could make a career change if you wanted to. Of course, it's not easy to just go and jump into AI and find an attractive opportunity. You build a career, you build relationships, and it's not easy to do it instantly. But I think to myself, okay, what's the reason to be in this asset class, and what are the things that excite me?

You mentioned being tunnel-visioned on Hyperliquid. In some ways, yes, from the outside it may look like tunnel vision, but what we're really doing is saying no a thousand times every single day to everything else.

And you know, one helpful framework that I think we've developed for ourselves—and that I think is helpful for people, and many people probably do this at this point—is to really invest in asset classes outside of crypto. Invest. Don't trade. Buy a real company that you believe in and just hold it. It'll train you to think like an investor. You can absorb more volatility, think long term, and actually think about the business, right?

If you do that and then go back to crypto, it'll make you realize that most of these tokens are not businesses and you should not be investing in them, right? But for the rare things that are real businesses and actually meet that threshold—where they're interesting to someone who doesn't have a reason to be in crypto—that's what you hold on to. And that's what you hold on to for a very long time because it's really hard to find those things.

And I think for us, so long as this story continues to progress the way that we see it progressing, and this thesis continues to evolve and get more exciting, it's not that hard to continue holding this thing. One behavioral difference that I see this cycle versus last cycle is that, in 2020 and 2021, what was the dominant mentality? It was “HODL.” I haven't heard someone say “HODL” in 4 years or something like that. I miss it—no one says that shit anymore. If you said “HODL” on the TL, people would be laughing at you.

HODL, I low-key think, is making a comeback because over the past couple of years, people have been trained that the way to make money is actually to be in meme coins, and you've got to be in and out. You've got to be in perps. Go 5x long, make sure you have the stop-loss, cut your risk, da-da-da-da-da, right? And I get it, because in 2021, if you didn't end up selling, you probably round-tripped a lot of generational wealth.

I get why people became more short-term, and I get why this cycle, when all you're doing is meme coins and perps, you are short-term, because by the very nature of those instruments or assets, you have to be short-term. But to take advantage of some of these opportunities, at least as I see them in the market today, you can't really trade. If you're the kind of guy who's trying to trade HYPE, you might have sold at 20, then sold at 40, and then tried to buy again. Before you know it, you're just bleeding P&L, eating a ton of fees, or eating taxes by trying to do this.

So, yeah, I don't know. Long-winded way of saying I think this is becoming the age of the crypto investor. It's coming, and it's not going to happen overnight. There's not an abundance of opportunities right now, but as time passes, there are going to be more Hyperliquids. Maybe it's not going to be tomorrow, but maybe a year or 2 from now, there will be more opportunities similar to this.

I actually think it's a sick take on the trading time frame, where everyone has shifted so far into perps and meme coins, into zero-day options, into piling in on a move based on a Trump tweet, a Saylor tweet, or a Santi tweet. The price action is so schizo. You'll be long, get stopped out, be long, get stopped out, and be like, “Man, if I had just closed my eyes for two weeks...” Even the difference between holding for 2 or 3 weeks versus a day or a couple of hours is huge.

I spent probably the last 3 months doing intraday trades, and, man, this is awful. I don't want to do this anymore. You look at some of these guys who have played semis, and it reminded me of early AI season a little bit, where sellers got punished. If you sold at any point, it was like, “Why'd you do that?” If you traded Hyperliquid, you got punished. Why did I long HYPE at 37 and close at 32? You got punished.

Speaking of holding things long term, I might be misquoting you on this, but I feel like you guys have gone easier on ETH than most—to be relatively optimistic about ETH amongst, I don't know. Even Bankless capitulated. David Hoffman capitulated, which is crazy. I was here in 2021. That's crazy.

Yeah, we don't hold any ETH, to be clear. But just going on the topic of ETH, it's one of those things where everyone, at least on Twitter and amongst my friend group, is so bearish on this thing at this point that I have to start questioning: Why is this thing still worth $200 billion?

And $200 billion is good.

I'm not bullish myself. I don't own any, and I don't have any interest in owning any. But I do want to keep monitoring this because maybe the market is sending a signal that there's still a lot of value here. It's not worth $200 billion for no reason. It's not arbitrary.

I keep thinking, too, maybe it's a bad asset right now, but maybe a year or 2 from now it becomes investable. What could be the reasons why? Who knows? Maybe it's because they ZK everything on Ethereum, and now it's a combination of BTC, ETH, and ZEC all into one asset. Maybe they get a bunch of rollups to start scaling, a bunch of enterprises to start using it, or a bunch of payments to start working on it.

You always have to be open to the future looking vastly different from what it is today. My fear is that if I get too caught up in the whole “ETH is cooked” hype, I end up missing out on what could be a great trade down the road.

4. Ethereum's Long Game

Yeah, I think this is one of those assets where if you talk to somebody in crypto and then talk to somebody who's in, say, a finance role—an investment banker, somebody who works at a PE fund, or somebody who works at a hedge fund—they're going to have completely different views on ETH as an asset, and I think that's interesting.

If you ask the average person working in finance who owns ETH, maybe they have a small percentage of their portfolio in it, or some leftover from the last cycles or whatever, and you ask them whether they care about how much revenue ETH is making, most of them really do not care in the slightest. That's interesting, right? I think that's been one of the biggest criticisms of Ethereum as an asset: the network itself is not really making money.

There are other differences that I notice. People outside of crypto do kind of care about this digital-bedrock thing, this Lindy-effect thing—the idea of a network and an asset that's going to be around for decades, at these relatively high levels of valuation for any asset.

I think Ethereum will occupy a very unique space in crypto. It's the most secure smart-contract network, and it's going to be the most Lindy smart-contract network. If you're playing the game of constantly competing with other blockchains—whether you're Solana or Hyperliquid—on performance, speed, bandwidth, or hot new sectors like stablecoins, I think it's just going to be a more brutal game. I'm not saying there aren't going to be winners, but nobody is trying to build what Ethereum is anymore.

Fair.

And I think over time, maybe there's some value in what they've built, and we just don't see it right now. But, like Ryan said, we don't own any ETH, so we just don't like to see this incessant bearishness on what we think. Yeah, go ahead, Ryan.

Yeah, I was going to say, I always think about what some of the original reasons were that I got into this in the first place. I'm going down the rabbit hole in 2014 and 2017, and what really piqued my interest was Ethereum.

This isn't a call for nostalgia. It's not like I'm saying, “Oh, wow, those were the great times, and I want ETH to work because that's how I was thinking in 2017.” But I do think those original values and vision that Ethereum laid out, which Santi kind of hinted at, are real.

As much as I'm excited about Hyperliquid, having 28 or whatever validators in Tokyo, all co-located, doesn't seem like something you can build the global financial system on top of. You need something that's robust to any one actor manipulating the system or a data center going down.

Could you imagine if we're really trying to put the entire global economy on blockchains—all payments, all trading, all lending—and the blockchain just goes down for an hour? Dude, are you telling me the economy just stops? That's catastrophic.

Catastrophic.

So I think something like Ethereum does make sense. It could just be the case that to build something like Ethereum, it's a multi-decade project because it's civilizational-scale public infrastructure that we're building.

Now, here's the thing. It could be the case that, yes, that's the endgame and we all see this endgame, but you start from different points. Maybe Ethereum is not the right way to do it because they're starting off being too ideologically driven.

It’s too slow. In contrast, Hyperliquid comes in and says, “You know what? Let’s just be practical. Let’s start with 4 servers. Let’s actually build a product that people want to use, which is just perps.”

You guys can do the whole spot market and lending thing, but in reality, no one wants to borrow against their ETH. We just want to trade. Let’s trade equities, prediction markets, and commodities. Let’s do that, and then let’s start to expand horizontally from there.

By the way, let’s start to distribute the validator set more, so that there are 4, then 12 and 20, and so forth. Who knows? Maybe in the long term, you get something that starts to resemble Solana more, with a larger validator set measured in the hundreds. Maybe you can distribute it a little more outside of the geographical concentration in Japan.

The question becomes one of path dependence. Does Hyperliquid win because it was the first to reach escape velocity, get all these users, and establish integrations with big brokerages, neobanks, and so forth? Or is it the Ethereum path, where you start by making the foundation super sturdy and eventually build all the things people want?

It’s an open question. If I’m being honest, as much as I’m mega-bullish on Hyperliquid for the foreseeable future, you have to be open-minded to the fact that it could still go in Ethereum’s favor.

That’s a good point. The time horizon is what’s going to cause a lot of people to struggle with this, because it is civilizational-scale. I like the way you framed that. It’s a massive overhaul vision.

I want to ask you one Bitcoin question as well, because I’m still kind of a Bitcoin maxi through and through. I’m curious—I’ll ask you, Speaker 1, and then I’ll let Speaker 2 go. If we assume that a couple of select alts—HYPE/BTC, ZEC/BTC, VVV/BTC, whatever—outperform Bitcoin, maybe you even reach a decoupling stage. You could argue Hyperliquid has already done it, but let’s say it really expands and pushes further.

Where does that leave Bitcoin? I was thinking there’s almost this collective myth that Bitcoin leads and then everything else comes after it, and it’s very self-reinforcing. Every cycle where that happens makes you more inclined to think, “Okay, Bitcoin’s going to lead. It’s going to play out the same way every single time,” until it doesn’t and that pattern breaks.

Maybe that’s happening right now, maybe it’s not. Maybe we have to deal with some Saylor outflows. Whatever the case, where does that leave Bitcoin as a standalone asset among this everything bubble that we’re rushing toward right now?

5. Bitcoin Becomes a Macro Asset

Yeah. I think, again, that over time, crypto used to be this self-contained corner of the internet, and it just grew beyond that. With each stage, the behavior of this market has changed a little bit. It happens slowly; it’s not instant. It’s not like you wake up one day and all of a sudden the market just changes.

Over time, you start to see different things. In the past cycle, it was like, “Oh, wait, we didn’t really have an alt season. It was just meme coins.” Then it was, “Damn, these altcoins didn’t work.” Then, “Wait, DeFi was shit. It was actually meme coins.”

This past year, it was supposed to be the four-year cycle, with 2025 being the year. 2025 sucked.

Yeah, my God.

Bitcoin was down on the year. We didn’t get any alt season. It was horrible. Then this year was supposed to be the bear market, according to the four-year cycle. You were supposed to wait until October to buy.

For Bitcoin, it’s been shit, but Hyperliquid bottomed in January and has actually been pretty much up only since then. This market changes over time, and I think that’s a good thing. As you get a wider variety of people in the market, with different biases and different ways of thinking about investing and these assets, all these assets start to behave a little differently.

So where’s Bitcoin today? I think Bitcoin is just a bona fide macro asset, and it’s a big one, too. This thing is worth $1 trillion to $2 trillion. It’s a big asset, and it’s not going to go up by multiples every single year anymore. That’s just not the way it’s going to behave.

There’s also a chance that this thing can just go sideways for a long time. There are many periods in the past, like 4 years, where Bitcoin doesn’t go anywhere. You can say, “Okay, this is an emerging store of value,” and create a million reasons why Bitcoin can continue to go up.

The basic assumption underpinning the entire investor psyche of this asset class is that Bitcoin always goes up. You never sell your Bitcoin. You always hold the Bitcoin. It’s the first thing that leads and the first thing that falls.

This might not be true. Eventually, you might get assets that, if we actually believe this shit matters and that we’re going to create products people use, do something totally different from what Bitcoin is doing. They go up for different reasons, they go down for different reasons, and Bitcoin is its own thing.

It makes sense because the way I think about it is that Bitcoin, if you categorize it as a store of value like gold, and you categorize something like Hyperliquid more like an equity, then look at the correlations between equities and gold. These are just two different things.

Yeah.

They are. So, all to say, I think Bitcoin has its own set of issues right now.

Mm-hmm.

I think those issues may prevent some capital from coming into the asset class, because there still are some people who treat it all as one lump-sum thing. But I think that’s just going to continue to improve the dispersion of returns over time.

I don’t think I gave enough credit to how big Bitcoin got. I saw something today saying that it just dropped out of the top 10 assets in the world. Some of these price targets feel unbelievable when you look at Bitcoin at scale compared to Nvidia, Google, and some of these other assets. It’s like, “Whoa.”

Yeah, we won.

Yeah. I’ll go back to Hyperliquid. I’ll ask a couple more questions, and then I’ll let you go soon.

On the Hyperliquid topic broadly, I think the most exciting aspect of it is that, when I think back on my time in crypto, I think about periods when new participants entered. The 2 standout ones are when I entered crypto, in 2020 and 2021, through Top Shot NFTs. That was a huge moment of net-new buyers, creators, thinkers, and every type of participant in between.

Then I think of 2024. I know not everyone loves to think back on 2024, but there were net-new players who showed up for meme coins and AI coins, maybe blowing off the top with Trump. We also had Bitcoin ETFs, though I don’t know how many new people came in for Solana ETFs and things like that.

It does feel like, behind one of the first successful DEXs ever with perps and then the Hyperliquid ETF, there is a net-new buyer entering the arena to play Hyperliquid. Who are these people? How should we think of them, and how does that dynamic evolve? It feels like a little bit of a new game.

6. Hyperliquid Attracts New Capital

Yeah, and I think there are a couple of categories. You have your typical family offices and your discretionary hedge funds. I think D1 posted a 13F where they own per in February, and they’re a pretty well-regarded shop. I think we’ll start seeing more of that.

Then you have longer-term capital, like endowments and whatever. I think the first step is really the discretionary hedge fund people, your nimbler family offices, and your Citrini-adjacent types—the people on FinTwit who read Citrini. He’s been tweeting about Hyperliquid a decent amount.

These people have a lot of money. They don’t really care about Bitcoin. They don’t care whether Bitcoin is up or down. If they see a good asset, they’ll buy it. They care about a believable story, which Hyperliquid has. They care about cash flows, whether it’s making revenue, and whether they can forecast it easily.

I think the biggest thing is that people in crypto today look at Hyperliquid and say, “This is so expensive for a crypto asset. It’s pumped for so long.” They have so much PTSD from crypto assets in general, and they think there’s always a chance that some sort of regulatory black-swan event happens and this thing gets wrecked.

That’s natural, because it’s happened so many times in the asset class. But whenever I speak to people who work at funds or sell-side shops—people asking me what this asset is—once they understand the actual addressable market and what it could potentially disrupt, the risk becomes, “Okay, whatever.”

Yeah, okay, there are some risks around regulatory clarity. It’s fine. If this thing actually does end up disrupting this multihundred-billion-dollar exchange and brokerage space, then it’s going to be orders of magnitude more successful than what it’s done already. I think that sort of asymmetry is what’s getting people really excited.

They’re not really looking at, “Can a DeFi, crypto, or L1 token get to $100 billion-plus?” They’re looking at Charles Schwab and IBKR sitting at around $150 billion valuations. They’re asking, “Is this actually a better type of business than those are?” because they actually own the underlying exchange infrastructure.

They’re thinking about all these things, and it’s just kind of opening up. I just talked to a hedge fund analyst the other day, and we had a 2-hour conversation. By the end of it, his mind was blown.

I think the biggest issue people have is that they just don’t know how to find the information they need about Hyperliquid because there’s no 10-K. You can’t just hit up Jeff on the phone and go, “What is this? What is that?” The docs aren’t that helpful from an investing perspective.

I think what’s changed is that now you can go to David Chaiken and Bob Diamond. You can go to Grayscale, which is marketing its ETF. You can go to Bitwise. These people are helping get the story out there.

The way this stuff works is that one dude buys it in their fund, tells another fund to buy it because now they’re in it, and starts sharing the story. Then it spreads like wildfire. Sell-side analysts start covering HYPE, and all of a sudden you kind of have this mass, stratified FOMO event coming into this token while crypto natives are completely sidelined.

Over the past few weeks, the DAO has bought around $80 million in HYPE, and the ETFs have bought over $100 million in HYPE. This is only going to continue. I don’t know why we’re focusing on Laura’s short, which is around $100 million, when HYPE has $100 million in the bank to buy more HYPE and they’re running this ATM weekly now.

I really think where the typical TA crypto traders get messed up is when we enter a paradigm shift for an asset and you’re marketing now to a much larger group—a much larger class of capital. I just don’t think these inflows are priced in at all.

That was sick.

That was really sick.

How do you guys price regulatory risk?

Yeah. Do you want me to just try and—

Sure, go for it.

7. Regulatory Risk Creates Asymmetry

I think it’s one of those things where you have to take these worldviews and go, “Okay, what happens if Hyperliquid is not legal in the U.S.?” That is just sort of what it is right now.

One thing that we walked through in the perpification thesis is the potential for something like Hyperliquid to disrupt global CFDs. CFDs trade about a billion dollars a day, and this is mostly global activity. Even in the case where Hyperliquid is not legal in the United States, I think you can build a fine business—a really, really good business—off of that activity.

It probably isn’t as exciting, but Hyperliquid as it exists today is still a very, very interesting business. Then it’s like, “Okay, what if that gets unlocked in some way?”

Trump the other day was just tweeting about perpetuals. It definitely wasn’t Trump. It definitely wasn’t Trump. But somebody in the Trump administration is tweeting about perpetuals.

We have Jake Chervinsky, who is at the top of his class at what he does in D.C. You have Hyperliquid now in bed with Coinbase and Circle. Obviously, Paradigm is a huge stakeholder in HYPE. Obviously, you now have Grayscale as a huge stakeholder in HYPE, and Bitwise as a huge stakeholder in HYPE.

If this thing passes, the sky is the limit for Hyperliquid. When you view the risk-return of that trade—“Okay, if this doesn’t work, then Hyperliquid is basically just what it is today, and it can still be a secular grower. If it does work, this thing becomes a mega-business almost overnight”—when you weigh those two outcomes, it becomes really obvious to me.

I think it’s just about playing those probabilistic views.

Yeah, I think Monk makes a good point. This is actually a topic that comes up often in discussions with different discretionary hedge fund managers in equities, because they’re all looking at this. In many cases, these people just copy-trade each other. A new idea spreads like wildfire, and they’ll start doing this.

It’s kind of funny because, again, so many people in this asset class have had the regulatory overhang as an existential threat for so long. It’s really screwed some projects, so people are very scared of this risk.

When you tell some of my buddies who work at these places, “Hey, listen, the future of Hyperliquid is unified margin to trade any asset in the world,” they get the vision instantly. They’re like, “Wow, this is incredible.”

There are maybe only 3 to 5 businesses across all asset classes and across the world that are even playing for this outcome. Hyperliquid is one of them, and it’s probably the most unique because the business itself is not like a traditional equity finance business.

It’s 12 guys who just went and built this thing. It’s software that runs almost autonomously. It has 99% net income margins. It’s literally a money machine. This is a money printer. It’s all going back to the HYPE token.

When you tell them, “Okay, this is the vision, and there’s just this regulatory risk that maybe they can’t get into the United States,” they’re like, “Oh, so you’re telling me this could be one of the greatest financial businesses in the world, but there’s just regulatory risk?”

They’re like, “Okay, I’ll note that there’s this risk, and I’ll get long.” It’s not like it stops someone from being long. It doesn’t make any sense, right?

Another thing, too, is that I think, ironically, there are many people in crypto who are a little too valuation-sensitive. Historically, not being valuation-sensitive got people burned because you ended up losing money. Now everyone has gone in the exact opposite direction, and they start pulling out their calculators—

Yeah, that’s the complete opposite. It used to be crypto math. You would get inflated crypto valuations.

Do you know how many businesses have been expensive their entire lives in public markets and have still gone on to go up 10–100x? Being expensive does not mean don’t own. I think people need to be crystal clear about that.

This is also a business that is growing at triple-digit percentages year over year. Of course it’s probably going to look expensive along the way.

It’s funny because they’ll do a DCF of Hyperliquid, and then they’ll go long some semiconductor stock with zero DD and just go, “This thing is up only.”

Also, on the regulatory side, I think that’s why there’s such a big trade opportunity. You have this overhang, and there’s delta to be captured on whether there is risk or not.

What was up with that tokenized stocks announcement a couple of days ago? The Hester Peirce thing where they came out and made this really pro announcement, then walked it back 10 minutes later? Something weird happened there, but the red candle just got gobbled. That was a little bit bizarre, huh? What happened there?

Yeah. I mean, I’m not a lawyer here, but my read of that is that it had nothing to do with perps. This is about actual tokenized assets.

I think the reason why they ended up making that specification is because you don’t want it to be the case where anyone—not just the issuer—can create a tokenized security, and then there are inconsistent rights for people holding it. They want to prevent all these random Anthropic SPV wrappers and—

Yes.

One of the great things about trading through your brokerage account, whether it’s IBKR or Charles Schwab, is that you don’t have to question whether the asset you’re holding is actually the asset.

But when you’re buying some random tokenized equity on Solana, it’s like, “Dude, what the hell am I even buying?”

You have no idea. Do you have any voting rights? Do you get dividend distributions? Do you have— It’s just, you have no idea.

I think it’s a good thing that they pumped the brakes a little bit and said, “All right, let’s make sure we do this right.” If you do this right, this is going to be a huge unlock.

So then I ask you: the SPV space as a whole is a disaster, but how do you think about, okay, Trade XYZ lists Cerebras pre-IPO?

Do you have the same “What the hell do I hold?” type of feeling?

No, because I think in that case it’s clear. I don’t actually hold the equity. It’s just this derivative. But I think the difference is, with the tokenized equity, unless you actually go through the documentation and read the fine print, you think you’re actually holding the equity, and you’re actually not.

Yeah, makes sense. That’s a good point, by the way. This whole scene—you talk to some of these SPV guys and they show you, “I have an Anduril,” and I’m like, “Who are you? You have it from a guy? What is going on here?” Carry is ridiculous.

What is your guys’ relationship? I think it’s so funny that you go on podcasts together. I love it. What is your relationship? And what is the vibe at Synapse? How many of you are there, and what is everyone working on?

Yeah, well, we work together. That’s our relationship. There are 4 people on our investment team: my co-founder, Dan, who doesn’t really do any public appearances, and Wilson, who worked with him at Messari. One of the reasons why we like to do these podcasts together is that oftentimes we’re talking about Hyperliquid.

It’s good.

We co-wrote the great Hyperliquid pieces. Sunny spearheaded that one. I think Mook is the in-house Hyperliquid historian and expert, so it’s always good to have him on these livestreams or different podcasts when we’re talking about Hyperliquid.

Yeah, I mean, Ryan’s my boss. That’s our relationship. I went and asked him for a job out of Messari. Shout-out to Tulip King, by the way. I know he’s working with you right now. We worked together at Messari.

I was at Messari with Tulip and a bunch of other guys, and at the time I was entertaining potentially moving on. I thought, “If I had my pick of where I could work, where would I want to work?” I was obviously trading on my own, and I have a public investing background. I was thinking about working at a liquid fund, but I didn’t know if I wanted to jump into the liquid space at that time because I felt it was still pretty early for liquid investing, to be honest, which clearly was correct. Liquid funds have not been doing well.

I said, “If I could just work somewhere, it would probably be Synapse, because I’ve seen these guys nail Sol and nail HYPE, both incredibly well, and then size into both in an incredibly concentrated fashion.” I thought, “Honestly, these dudes are chads. If I could work with anybody, I’d want to work with them.”

Ryan and I knew each other because he was a Messari alum, and we had met up to talk about Hyperliquid. So I just asked Ryan for a job.

Wait, before I let you go, I’m reading this book right now. It’s called More Money Than God.

Yeah.

You’ve read it before?

Yeah.

I have this hedge fund obsession right now. What is the state of liquid funds in crypto specifically? And how did you—I guess you went from Messari and started Tigressy?

Yeah, my background is investment banking, Messari, and Tigressy. My co-founder was also in investment banking. That’s where I met my co-founder. Then he did long-short equities and then long-only for about 5 years, and then we started Tigressy.

As far as the state of liquid managers or liquid funds right now, I’d say the past 4 years have not been the greatest environment for anyone who’s just long-biased, with the exception of Bitcoin and a couple of outliers.

Are you long-only?

Generally, we are long-only.

Yeah.

Yes, we don’t short.

For the better, honestly. Shorting’s a dark art, man.

Yeah, I mean, this is early-stage tech. If you have to short to make money, it’s because this tech sucks. And if the tech sucks, then why are we here?

I think we’ve always just been long-only because that’s actually the asymmetric opportunity we’ve seen with this asset class for as long as I’ve been here. The past 4 years, I don’t think we’ve really been in a secular uptrend for the asset class, with the exception of Bitcoin. It’s been a very mixed bag of things trading.

Even Solana, which was the coin of last cycle, you can argue that it barely even broke its all-time highs from 2021. It’s kind of just been in a range since then. Same thing with Ethereum. In fact, the only assets that have seemingly made new highs have just been the new ones, like Hyperliquid.

I think it’s been a challenging environment for liquid funds. But what I will say is that—and I think this year is actually a good thing—with Bitcoin struggling, asset selection outside of Bitcoin has really been a big differentiator. If you’ve been able to pick well, you probably have done well this year. I think this is a sign of what’s to come for the asset class if there are more investable assets beyond Bitcoin that can actually put up the numbers and outperform. At least that’s what we’re seeing internally in RNR.

Sick.

Yeah.

Go back.

Oh yeah, I was just going to say that HYPE at one point was at around $2 billion, and you could have gotten an entry on it. Now it’s at around $60. So that’s $2 to $60 in the public markets in an incredibly short period of time.

If you’re an allocator and you want exposure to that, there’s just no way you’re going to do that yourself. This asset class is a minefield. You can’t do it passively. There’s no index of crypto tokens you can buy to get exposure to crypto. If you want liquid exposure, your best bet is probably to find a liquid manager or avoid the asset class entirely, which is what a lot of people have done too.

Sick.

Yeah. I think the indexing part is actually really funny because in equities you can do the S&P 500, you can do a QQQ, whatever. It’s really easy to systematically allocate to it. There’s no equivalent in this asset class—literally none.

I think for the longest time people have treated Bitcoin as the index because it’s the easiest thing to buy. You can buy it for free in your brokerage account, retirement account, whatever. But if we’re actually going to have real use cases and real products emerge beyond Bitcoin, then that doesn’t capture the full opportunity.

What was actually interesting is that I was on a couple of strategy calls for different Hyperliquid [?] recently. There are some people who are allocating to HYPE, and they’re not really valuation-sensitive here. The view is more from a portfolio-construction lens: in order to capture the opportunity, I need to have X, Y, and Z assets in these weightings to fully capture the opportunity.

Sometimes that’s actually the most important thing when you have a big cycle trend. You can be the guy who says, “I’m going to find the best asset and make the most money,” or you can be the guy who says, “You know what? I could do that and swing and miss, which is a risk, or I could try to make sure that I capture whatever opportunity there is.”

If this asset class is going to be a thing and it compounds at 25% or 30% for the next decade, you just need to make sure that you capture the asset class. It doesn’t matter if you miss out on the one big thing by not being oversized. You just want to make sure that you’re in the trade, you capture it, and you get the exposure.

That is what people have lost sight of in all of this: you’ve got to think long-term. 5 or 10 years out, what do you think the CAGR for this asset class is going to be? Make sure you find ways to take advantage of that and don’t take yourself out of it.

It’s a good point too, because these other charts are just filled with dead money. They have all this garbage, and you can’t even use them to chart against anything.

Look, you guys are sick. I think what you do is so sick. I have a huge fund obsession going right now, so I’m particularly interested in your job. You guys have nailed the Hyperliquid trade so publicly, so I look forward to Part 4—maybe when Bitcoin’s at $60,000, HYPE is at $100, and everybody’s in panic mode. I’ll text Ryan: “Please, please come on.” You guys are awesome. Thank you again for coming on.

Let me ask you one question. Someone typed this in the chat. Last question, then I’ll let you go. Malcolm, my co-founder, typed this. I’ve been running around saying I’m obsessed with activist investing right now. I think it’s the coolest thing ever.

There was this fund, Irenic Capital, that came out and bought around 3% of Snapchat. They posted a 60-page presentation on exactly what Spiegel should do and how it was going to work, and so on. Snapchat didn’t listen.

What is your take on a large distribution channel, like a Satrio or an Ansem, one of these really large KOL-type figures in FinTwit, transitioning into the activist, liquid, money-management scene?

Last question; I’ll let you go. Sounds like what you’re doing then, huh?

No, I’m just—I’m just—

[laughter]

I run around the house all day, and I’m like, “When I make $10 million in my Hyperliquid account, we’re turning Counterparty into a fund.” I run around screaming all day.

It’s—we call it “fund guy.”

Yeah. What was I going to say?

I think we’ve seen this already in venture capital: influencer-led fund management. If you can build a reputation and get a ton of followers on Substack and Twitter, and you build a reputation in the industry, then you might be able to source interesting deals and raise a fund. You’ve seen so many people do this over the past 5–10 years. They start out with a blog, they start out with their own podcast, whatever, and they raise some money.

I think liquid investing is a little bit different because your ability to make money is less about your access and your reputation. It’s more about whether you can analyze a public opportunity that everyone else has access to better than average.

I still think if people do it, people like to give money to people they trust. I think an easy way to build that trust is just to be visible. In many cases, people conflate familiarity with trust, which can be good and bad, but I think it works.

As far as activist investing, maybe another part of this is—and this may be my own personal view, but to each their own. Everyone has their own style. I think the second that you, as an outside shareholder—maybe you did a ton of diligence, maybe you spent a year doing diligence on this business—the second that you, as an outside shareholder, are jumping in because shit is so bad to make a decision—

Fair.

Dude, just sell it. You’re not locked up. There are so many other ways to make money. There are so many great businesses.

One of the great things about this—and I remember this is actually something I thought about with Sync receipt[?] early on—is, okay, wow, we have this decentralized governance. What if I was super involved in the governance forums and I could make an impact?

Then I thought about that, and I’m like, damn, the things I can make an impact on kind of suck. I don’t want to be involved in the token-holder voting process. The things I actually want to own are things like HYPE. Dude, there’s nothing I can tell Jeff and co.

Nothing.

To make their product better, and that’s great. They should be the experts. They should be the ones that don’t need me. I’m just the guy who’s holding it and maybe preserving an educational role. That’s it. All right.

Sick take. Honestly, a good take. It’s like the club that they want you in and you don’t want to be part of. I love it.

Thanks for the take. All right, I’ll let you guys go at the top of the hour. Thank you so much. It was an absolute pleasure. Congratulations again. I look forward to part 4. It’s always great to have you guys on. And, yeah, Knicks in 6, man.

Let’s go.

Thank you so much.

Thank you. Peace.

Later.