Crypto veteran Arthur Hayes has issued a warning over Monad, saying the just lately launched layer-1 blockchain might plunge as a lot as 99% and find yourself as one other failed experiment pushed by enterprise capital hype relatively than actual adoption.
Talking on Altcoin Every day, the previous BitMEX chief described the undertaking as “one other excessive FDV, low-float VC coin,” arguing that its token construction alone places retail merchants in danger. FDV stands for Fully Diluted Value, which is the market worth of a crypto undertaking if all its tokens had been already in circulation.
Based on Hayes, initiatives with a big hole between FDV and circulating provide usually expertise early worth spikes, adopted by deep selloffs as soon as insider tokens unlock. “It’s going to be one other bear chain,” Hayes stated, including that whereas each new coin will get an preliminary pump, that doesn’t imply it can develop a long-lasting use case.
Hayes stated most new layer-1 networks finally fail, with solely a handful more likely to retain long-term relevance. He named Bitcoin (BTC), Ether (ETH), Solana (SOL) and Zcash (ZEC) because the small group of protocols he expects to outlive the following cycle.
Final yr, Monad raised $225 million in funding from enterprise capital agency Paradigm. The layer-1 blockchain went stay on Monday, accompanied by an airdrop of its MON token.
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Hayes stays bullish
Hayes additionally laid out a bullish outlook for crypto as a complete, pushed virtually totally by renewed financial enlargement. He argued that governments, significantly the US, are getting ready for one more wave of liquidity injections forward of political campaigns and slowing progress.
“I feel that we’re on the finish of the start of this cycle and the large quantities of loopy bull market cash printing is forward of us,” he stated.
He additionally dismissed the broadly cited four-year Bitcoin cycle, saying previous market booms had been fueled not by halvings however by world credit score enlargement led by the US and China. When liquidity dries up, Bitcoin reacts first, he stated, calling it the “final free-market smoke alarm” for the worldwide monetary system.
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Privateness cash to dominate
Wanting forward, Hayes predicted privateness applied sciences will dominate the following crypto narrative, with zero-knowledge programs and privateness cash seeing renewed curiosity. He added that institutional adoption is more likely to decide on Ethereum, particularly via stablecoins and tokenized finance.
Earlier this month, he revealed that Zcash has become the second-largest holding in his household workplace Maelstrom, trailing solely Bitcoin.
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