The End of the L1 Premium? | Hype, Venice & The Future of Crypto

The End of the L1 Premium? | Hype, Venice & The Future of Crypto – The Hivemind

Market views

Bullish

HYPE— Hyperliquid is repricing higher due to durable stablecoin revenue component adding buffer against cyclicality, favorable SEC news on tokenized equities enabling liquid spot markets for perps, and structural flows from institutional adoption. The business is generating significant revenue from non-crypto activities (equity trading, commodities) and has strong fundamentals with improving token economics.
VVV— Venice (VVV) is showing strong revenue growth with clear path to adding at least 200M ARR over next 12 months based on published subscription data. Clean equity structure with no competing investor interests increases likelihood of value accrual to token. Forward earnings provide significant upside as business scales.
ZEC— Zcash is performing well as a strong privacy narrative play in a selective market environment where only tokens with structural flows, fundamental businesses, or compelling narratives are outperforming.
BTC— Long-term Bitcoin thesis remains strong based on currency debasement, expanding government deficits, and increasing defense/government spending that won't be matched by revenues. Short-term volatility doesn't change the structural macro case.
DEFENSE— Defense sector has strong tailwinds from multipolar world requiring increased spending, paradigm shift from Ukraine war showing drone warfare effectiveness, and reset of traditional military equipment value. Counter-drone technologies and laser defense systems represent significant growth opportunities with improving unit economics.
ROBOTICS— Robotics sector is due for repricing after inference stole attention. Companies like Figure and Avtronc have stale valuations that don't reflect current market conditions. Sector offers defensible AI business models as software costs trend toward zero.

Bearish

ETH— Ethereum at $250B market cap lacks clear catalysts and has suffered from L2 thesis failure. Most L2s see minimal activity, and revenue generation has not materialized as expected. No compelling reason for institutional bid at current valuation.
SOL— Solana has lost significant revenue and faces structural challenges from Hyperliquid's success undermining the L1 token premium thesis. Trading near $85 vs prior $250 high with unclear path to recovery despite technical strengths.
LAYERONE— L1 value accrual thesis has failed as killer apps move to their own optimized chains (AppChain thesis). Revenue generation is critical and most L1s aren't delivering. Market has shifted to favoring specific applications over platform tokens.
LAYERTWO— L2 thesis has completely failed with 63 out of 118 L2s doing less than 0.1 TPS. Only Base and Arbitrum show meaningful activity. This failure has hurt both Ethereum and related infrastructure plays like Celestia.

Not investment advice.

Mentioned

Market views