Has This Cycle Peaked? | 1000x

Summary

• SUI is a bear-market buy, not a $50B one. Jonah’s tell is the vitriol itself: when he bear-posted Solana in October 2023 at ~$15B market cap and got 700,000 views of abuse, it proved the community was alive — Solana then ran “from $8 to $200.” SUI’s rabid defenders read the same way, but with no killer app and nobody able to answer “why would buyers of blockspace prefer this blockchain,” the trade is to accumulate “during the next bear market” for a potential “100x-er,” not to chase at $50-52B.
• Hyperliquid is undervalued as an exchange — “just based on being an exchange [they] are undervalued,” trading around a 12-15x forward multiple, and it’s the rare app going backwards into an L1 with a baked-in killer app. Avi’s flow data: big wallets that offloaded above $30 are “just starting now to buy back below 20 and 18.” Jonah’s sizing rule: scale small now, save the “big slug on high conviction” for when Bitcoin breaks the range.
• The market has shown its hand for the next leg. With Bitcoin “knocking around like a pinball machine between 92 and 98k,” the hot-money names — Hyperliquid, AI16Z, Virtuals — grind lower daily; on a break to “125 or 150k Bitcoin,” that money “is going to flow right back in and power-lift those tokens.” Jonah is explicit on the cycle: “I think we’re going much, much higher.”
• The top-10 basket trade may not transfer to crypto AI. Jonah’s structural argument: DeFi winners had liquidity network effects that made them harder to displace, while AI frameworks have “basically no switching costs” — so the DeFi playbook of buying sector leaders (AI now ~$10-15B market cap vs. DeFi’s ~$150B peak) may not transfer. Avi changed his mind on tape: “these things just rip and then they fizzle” — he’s still bullish AI mania but now wants to trim; Jonah would rebid Virtuals at $2-2.30.
• Ignore NFP, watch only CPI. “Imagine selling Bitcoin at 92k because you’re worried about a non-farm payrolls print eight days before regime change in Washington” — the only macro print that can torch crypto is “a screaming-high CPI.” Trump is “likely to be an inflationary president,” so Jonah’s one macro trade: bearish bonds — “I wouldn’t touch bonds with a 10-foot pole… you do not want to be earning fixed income in Trump land.”
• The KOL-round machine is the industry’s quiet grift. Avi, eight years in: angel allocations at $1M valuations that list at 15x, 20x, or 40x are “free money” where “your entire edge is getting in at that low valuation… of course you’re going to sell right away” — which is why their THX token launched with no round, organically, at a ~$100k market cap. The Bankless/AICC dump is the cautionary tale: “torching your reputation for $2 million is the funniest thing I’ve ever seen.”
• Agents are the crypto-AI vertical that sticks. Jonah calls agents “really the only thing where you could cross the chasm from crypto nerds to the mainstream” within 12 months; the hosts’ own bot (migrated from Virtuals’ no-code to ai16z’s Eliza) shows that domain expertise is a required input — “you can’t just have random devs building trading agents because they don’t know how to trade.”

Deep dive

1. The vitriol is the bull case — but SUI is what you buy in the winter

• Jonah’s framing comes from his own scar tissue: in October 2023 he tweeted, after a bottle of wine in Venice, that Solana was doomed — token at ~$15B market cap — and got 700,000 views, name-calling, “insulting my parents and stuff.” The lesson: “people really care, they’ve invested their livelihoods in this thing.” He flipped bullish $10 above his max-bearish level, and Solana went “from $8 to $200.” The SUI hate after the last podcast pattern-matches — a rabid community can drive a self-reinforcing rally.
• His unanswered question still stands: “blockchains sell blockspace — why would buyers of blockspace prefer this blockchain to any other?” Nobody on Twitter could answer without insulting him, and history says technological superiority “hasn’t necessarily translated into upward price action.”
• Avi grants the tech is real: the ex-Meta SUI team were “better actual tech people” than sibling Aptos (better marketers, but Aptos “kind of shit the bed” and the founder quit), a Blockworks survey of Solana devs had Base and SUI tied as the alternative chain with nothing else close, and SUI has reached parity with Avalanche despite the head start. His read: “people don’t want subnets, people don’t want L2s, people want a fast base-layer chain.”
• The joint call: no killer app (the biggest protocol is a generic borrow-lend, though TVL is growing fast), so it’s not worth $50-52B here. It’s “the kind of product that you buy during the next bear market” — if the builder community survives the winter, “that’s going to be like another 100x-er.”

2. Hyperliquid: undervalued as an exchange — trade the flows, not the vibes

• Jonah’s top-signal heuristic, worth framing: SoFlo, the token’s biggest proponent, “was having way too much fun on Twitter” at the highs, ending every tweet with “Hyperliquid” — “when somebody’s having that much fun on Twitter with their number one bag at the highs, you should probably start chipping out.” Hyperliquid is now off ~50%.
• Avi watches wallets instead: big holders began offloading once Hyperliquid hit $30 and are “just starting now to buy back below 20 and 18” — significant money returning, and “I just don’t see that many large holders offloading anymore.”
• The structural angle: apps very rarely go backwards into an L1, which raises the valuation ceiling and gives the chain a rare baked-in killer app. The open question is whether it can build unique applications beyond an exchange; if it’s just Uniswap-style DEXs, “forget about it.” Avi: “these guys just based on being an exchange are undervalued” — around a 12-15x forward multiple. Jonah’s irony: it’s built on the Cosmos SDK/Tendermint, yet ATOM — “done… public infrastructure” with “no real leadership” — benefits not at all.
• Jonah won’t catch the falling knife at $20: accumulate small now, and do the “big slug on high conviction” only “when the market’s rallying again” — same rule for Virtuals and ai16z.

3. The market has already shown its hand for the next phase

• Jonah’s map: Bitcoin is “knocking around like a pinball machine between 92 and 98k” while Hyperliquid and the AI coins grind lower “every day or every week” — that grind identifies the hot money. On the next leg to “125 or 150k Bitcoin, the hot money is going to flow right back in and power-lift those tokens.”
• On the peaked-or-not debate he’s categorical: “I think we’re going much, much higher” — and what rips is already known: “Hyperliquid is clearly gonna rip… maybe SUI, as much as I hate it, will rip,” plus AI16Z and Virtuals.

4. AI coins are not DeFi — network effects differ

• Jonah’s structural argument, the episode’s sharpest: DeFi winners compound — more liquidity makes a Uniswap or a lending protocol a better product, so leaders get “harder to displace, not easier.” AI frameworks have “basically no switching costs,” so the DeFi playbook — buy the top 10 and ride the sector — may not transfer: “it’s so much easier to disrupt them.”
• The sizing math both cite loosely: crypto AI at ~$10-15B market cap versus DeFi’s ~$150B peak in DeFi summer — the gap is the bull case, the disruption risk the catch.
• Avi’s pushback from experience: migrating their full-code Eliza bot would be “a heroic pain in the ass,” though no-code switching is “as seamless as switching from Uber to Lyft.” Jonah’s reframe lands anyway — usage doesn’t improve a framework, and Avi extends it: more bots on one framework means commoditized output, poison when the product is farmed attention.
• Avi’s change of mind, preserved as said: “I used to think… AI mania is coming to crypto, that’s my conviction trade, I’m just going to be long the top 10 call options… these things just rip and then they fizzle” — Bittensor plateaued, GOAT came and went, Virtuals ran 225 to 520 and back to 270 with sellers “absolutely hammering” it. Avi still thinks the sector “is going vertical” but will sell some; Jonah’s rebid on Virtuals is $2-2.30 if it fully washes out.

5. The THX agent: domain expertise matters

• Their bot started as a pet project launched by Avi while Jonah slept, then migrated off Virtuals’ no-code framework to ai16z’s Eliza. Avi’s underrated point: “you can’t just have random devs building trading agents because they don’t know how to trade” — the hosts hand-encode market logic (“if open interest goes up… means X in context A and Y in context B”).
• The roadmap: make it excellent as a crypto market sidekick, “copy-paste that into commodities,” then every market, then beyond trading entirely. Jonah’s conviction: agents are “really the only thing where you could cross the chasm from crypto nerds to the mainstream” — the AI vertical that “sticks and achieves mainstream appeal in the next 12 months.”

6. Bankless torched its reputation for golf-clap money

• Avi’s confession about why he avoids angel deals after eight years as a “quote-unquote KOL”: those rounds are “free money” — in at a $1M valuation, live at 15x, 20x, or 40x — so “your entire edge is getting in at that low valuation… of course you’re going to sell right away, you don’t believe in the project long term, but you have to pretend.” “That’s what I fucking hate about this industry” — and why THX ran no round, even though people were angry they weren’t told.
• The AICC case: the Bankless guys got a large allocation and dumped it on launch day onto the public — and the token still trades at $60M, “kind of nuts.” The verdict: “torching your reputation for $2 million is the funniest thing I’ve ever seen in my whole life” — split two ways, high-tax American jurisdictions, call it $500k each: “golf clap.” Avi’s dig on the way past: “if you love Ethereum, you’re probably poor.”
• The constructive lesson: launch organically and get the community in at an attractive price — “you can’t let them in on the highs and then hammer it all the way down in their face and expect a good outcome.”

7. NFP is noise, CPI is the tell — and don’t own bonds in Trump land

• Jonah on the week’s macro panic: “non-farm payrolls, jobless claims — who freaking cares… the only thing that’s going to torch crypto macro-wise is a screaming-high CPI print.” The line of the episode: “imagine selling Bitcoin at 92k because you’re worried about a non-farm payrolls print eight days before regime change in Washington — and not just any regime change.”
• Avi’s hindsight-capital complaint: Bloomberg discovered rate risk only after the print, yet the 30-year had already moved from 4% to 5% between December and January — “people only talk about it when it really hits you in the face, and by that point the move is priced.”
• Avi hedges the setup exactly this much: the strong print “could be an indication that inflation is going to come back in a big way, but that’s not a given.” Jonah says Trump is “likely to be an inflationary president” — hot economy, high tariffs, no illegal laborers, pressure on the Fed — and if the Fed pauses, “Trump is going to go ballistic.” Jonah’s single macro takeaway: bearish bonds — “I wouldn’t touch bonds with a 10-foot pole… you do not want to be earning fixed income in Trump land.”