Alpha First.
Retail investors are not participating in this cycle Your counterparties are battle-tested veterans
Going with the Consensus
Every war starts the same way. Old men are locked in irreconcilable arguments over beliefs, power and resources, and the ultimate solution is to send the young men to kill each other. We all know the adage, “Old men declare war, young men die,” but no one talks about the aftermath.
As the war dragged on and manpower dwindled, countries were forced to recruit from older age groups. Suddenly there were teenagers and middle-aged men in the trenches. In the final stages, you would see children and old men trembling and clutching their rifles. This is where we are today in the cryptocurrency trenches.
We’re well past the peak in 2021
Google search trends for “cryptocurrency” peaked in the summer of DeFi 2021 and haven’t recovered since. Even when the Crypto Brothers helped elect Donald Trump, it only brought the search buzz for “cryptocurrency” back up to 61% of its previous high. Needless to say, there’s hardly any fresh blood in the crypto trenches. If you’re reading this, congratulations, you’re one of the “old men” still fighting in the trenches. Next, let’s make a plan for survival.
Don’t be afraid to go with the consensus
“The consensus is always wrong” is a common fallacy, and the art of when to follow the crowd is a delicate one. Remember, Warren Buffett started buying Apple stock in 2016 when it was already the world’s largest publicly traded company by market capitalization, not his typical ‘deep value investment.’ In this market, you have to be a compliant sheep and not buck the trend.
In past cycles, the influx of new retail investors has pulled down the overall IQ and experience level in the crypto trenches. This makes it easy to capitalize on your own experience and sell them a new Ponzi scheme. If we had 2021-sized retail investor participation, Launchcoin could easily top $1 billion in market capitalization, whereas today it failed to even break $400 million before starting to fall back.
Remember, crypto Twitter is just a niche corner of the industry. We all read the same articles and tweets, stare at the same 5-minute charts on the DEX Screener, and trade the same tokens. This also means that projects like Launchcoin are the fifth generation of harvested memecoins we’ve ever seen, and people just aren’t interested in playing that game again.
The opposite of this phenomenon also holds true. That’s why Bitcoin and Hyperliquid have outperformed other networks. Everyone in the trenches has come to the consensus that we are really bullish on these tokens. Bitcoin has never let us down, and Hyperliquid is a really good product. As long as these tokens maintain positive consensus sentiment, you can continue to add to your holdings.
In this cycle, new inflows into consensus assets like Bitcoin and Hyperliquid will come from institutions and veteran crypto traders who have given up on bucking the trend.
Don’t Buck the Trend, Act Early
There is a shortage of inexperienced retail traders in today’s market, which also means that it is difficult for you to make money by operating against the trend. Your counterparties in this cycle are as smart as you are. If your countertrend trade hasn’t started to gain consensus, it won’t work.
Ether continues to run away with the rest of the network
This is why .eth fans can’t change the ethereum narrative. We’ve heard Bankless spout the same cliché countless times. Until I see Vitalik’s roadmap for Ether’s L1 expansion tattooed on his forehead, you’ll never convince me to buy that “cursed coin” again. I was smart enough to swap Ether for Bitcoin before most of you (early 2023), but I still regret holding onto it for so long. I think others in the market feel the same way.
Instead of bucking the trend, it’s better to get involved in areas that haven’t been discussed yet before it’s too late. Instead of betting that you can fight the market, bet that you can research and dig harder into potential projects. The real advantage is in spotting quality targets before a consensus develops:
Investing in new networks with poor bridging capabilities Buying small cap tokens with high slippage
Finding projects with very poor user experience but great ideas
Reach out to your friends who are most deeply involved in the Bitcoin and HyperEVM ecosystems, ask them what emerging projects they think haven’t gotten enough attention, and dive into the project documentation. The strategy is not to fight the consensus, but to get deeper into the consensus faster than everyone else.
Where Will Institutional Money Flow?
While retail investors are watching from the sidelines, institutions are actually moving in. The good news: institutions are essentially ‘consensus market participants’:
They can't invest in illiquid assets, they must focus on the biggest assets They can’t justify “betting against the trend on Memecoin” to investors, they have a fiduciary duty to make sound decisions
They move slowly but with big money, and will form predictable trends
Even better, institutional movements are relatively easy to predict because there are only two large-scale business models:
Asset Management / Custody: Institutions such as BlackRock want to custodian the largest assets for the highest returns. Their ETF inflows favor Bitcoin first, with possible spillover into other large-cap assets like XRP.
Volume / Volatility: Institutions like Citadel Securities make money by trading smarter than you in the order book. They need markets with plenty of liquidity and reasonable volatility, which is exactly what Hyperliquid provides in the derivatives space.
So ask yourself: what is the consensus largest custodial asset? Bitcoin. And then ask yourself: where is the consensus place to get new assets on the exchange? Hyperliquid. don’t try to be clever and try to outsmart the institutions, sometimes it’s as simple as that, put yourself where the institutional money is going to go, not where you think it’s going to go.
Areas where retail investors are likely to enter
AI fever is still on the rise
Lastly, a hedging strategy. Searches for “AI” are still climbing to new highs almost three years after the launch of ChatGPT. The intersection of cryptocurrencies and AI has the potential to attract capital inflows.
However, exactly how this will play out is unclear. Will retail investors actually buy into crypto projects or continue to chase NVIDIA? Will they buy crypto projects like Bittensor or Sam’s Worldcoin?The AI narrative may be the only catalyst powerful enough to bring retail investors back to the crypto market. But it may only favor specific projects, not the general public.
Advantage for veterans
The absence of retail investors doesn’t mean this bull market can’t be profitable, just that it will reward a different skill set. Veterans still in the trenches have the following advantages:
The ability to recognize shifts in the trend before the narrative is fully formed An understanding of the market cycle and the judgment of when to take profits
A network of other veterans to share information with
Battle-tested risk management strategies
This cycle will reward patience, discipline, and the ability to go with the consensus while laying out the emerging narrative ahead of time. It will not reward counter-trend bets against established trends or attempts to resurrect dead narratives.
Fighting in the crypto trenches won’t be easy, but the rewards will be great for those who adapt to the new battlefield environment. The legions of veterans may be smaller than the retail army of 2021, but we are smarter, more experienced, and better at capturing value. Ether continues to outperform other networks
That’s why .eth fans can’t change the ethereum narrative. We’ve heard Bankless spout the same cliché countless times. Until I see Vitalik’s roadmap for Ether’s L1 expansion tattooed on his forehead, you’ll never convince me to buy that “cursed coin” again. I was smart enough to swap Ether for Bitcoin before most of you (early 2023), but I still regret holding onto it for so long. I think others in the market feel the same way.
Instead of bucking the trend, it’s better to get involved in areas that haven’t been discussed yet before it’s too late. Instead of betting that you can fight the market, bet that you can research and dig harder into potential projects. The real advantage is in spotting quality targets before a consensus develops:
Investing in new networks with poor bridging capabilities Buying small cap tokens with high slippage
Finding projects with very poor user experience but great ideas
Reach out to your friends who are most deeply involved in the Bitcoin and HyperEVM ecosystems, ask them what emerging projects they think haven’t gotten enough attention, and dive into the project documentation. The strategy is not to fight the consensus, but to get deeper into the consensus faster than everyone else.
Where Will Institutional Money Flow?
While retail investors are watching from the sidelines, institutions are actually moving in. The good news: institutions are essentially ‘consensus market participants’:
They can't invest in illiquid assets, they must focus on the biggest assets They can’t justify “betting against the trend on Memecoin” to investors, they have a fiduciary duty to make sound decisions
They move slowly but with big money, and will form predictable trends
Even better, institutional movements are relatively easy to predict because there are only two large-scale business models:
Asset Management / Custody: Institutions such as BlackRock want to custodian the largest assets for the highest returns. Their ETF inflows favor Bitcoin first, with possible spillover into other large-cap assets like XRP.
Volume / Volatility: Institutions like Citadel Securities make money by trading smarter than you in the order book. They need markets with plenty of liquidity and reasonable volatility, which is exactly what Hyperliquid provides in the derivatives space.
So ask yourself: what is the consensus largest custodial asset? Bitcoin. And then ask yourself: where is the consensus place to get new assets on the exchange? Hyperliquid. don’t try to be clever and try to outsmart the institutions, sometimes it’s as simple as that, put yourself where the institutional money is going to go, not where you think it’s going to go.
Areas where retail investors are likely to enter
