Trading Crypto's Weekend Meltdown

Summary

• Worst alt carnage since FTX while Bitcoin holds. ETH printed a two-year low at $2,100 (last seen August 2024), $2.17B was liquidated in 24 hours, and AI16Z fell 22.5% — yet BTC’s -3.5% sat roughly in line with S&P futures’ -2% after Trump’s Canada/Mexico tariffs. Jonah’s read: “Trump is not going to preside over the death of the American equity market to prove a point” — choppy, not regime-breaking.
• “Inverse alt season is the new alt season” — coined live on the pod. Avi’s frame: the old easy trade (alts as delayed leveraged Bitcoin) is dead because ETF wealth in IBIT “is certainly not flowing into dog with hat”; too many coins, not enough capital. The new layup is shorting oversupplied coins that haven’t puked on bad news — Avi’s biggest-ever crypto short is WIF after the Sphere charade, sized as a hedge against his broader crypto exposure.
• Avi calls the bottom — recording ~11pm Eastern Sunday, having nibbled Saturday because “Sunday is when the crazy stuff happens,” he’s “fairly confident this is at least a short-term bottom.” He pushes Jonah to cover WIF now: down 25% on the day and ~70% in two weeks, mean reversion is due, and his rule is anything ±20% in a day comes off. Jonah’s resistance: “whiff is zero.”
• The buy list is ETF-catalyst alts against an ETH short leg. XRP, LTC (below $100), and SOL got nuked because pre-positioning was liquidated — Avi would buy battleship SOL outright versus USD, speculative ETF plays versus ETH, since “eth has been the dog of the cycle” and “has not done anything interesting for four years.” The other trade: close shorts and get long Hyperliquid — only HYPE ($22, green on the day) and Fcoin were up, because “quality matters.”
• Monero is quietly the trade nobody discusses. Avi’s case: it’s actually used, and as ETF-era Bitcoin becomes trackable, “Monero is literally a Swiss bank in your pocket.” Jonah’s challenge — why not Zcash at 1/7th the FDV? — draws the conspiracy that Zcash’s setup ceremony was compromised and more supply exists than known. Both agree a trade-war world is long-term bullish privacy.
• Tariffs get walked back through the backdoor, but the long game is multipolar. Jonah’s blueprint is Trump 1.0’s Iran play — public partial waivers plus Iranian oil quietly moving through Chinese bonded storage. Longer term, the end of American soft power means “the dollar cannot live in a multipolar world the way that it is right now” — his conclusion: Bitcoin “should be $50 million.” Avi won’t take the dollar view (offsetting flows) but agrees a multipolar world demands an apolitical reserve asset.
• The top’s tells, in hindsight: XRP and SOL got CME futures listings and didn’t rally — “everyone’s max deployed” — and Bitcoin didn’t go higher after the Reserve news. Jonah’s rule: when the market refuses to go up on good news, “cash is more important right now than it was before.” Both still close bullish here: “a really freaking good time to buy… the good stuff.”

Deep dive

1. The worst alt wipeout since FTX — and Bitcoin barely noticed

• The setting: ~11pm Eastern on a Sunday, mid-meltdown after Trump opened a trade war with Canada and Mexico. Avi’s framing: the worst carnage “since FTX when it comes to alts” — “if you held anything besides Bitcoin you’ve retraced every candle since the election.” ETH traded $2,100, a two-year low last seen August 2024, down 12%; AI16Z fell 22.5%; $2.17 billion was liquidated in 24 hours — “who’s outright long with leverage?”
• Jonah’s cross-asset read: S&P futures -2%, Bitcoin -3.5%, “kind of in line” — the market of companies that build stuff telling you it’s a negotiating tactic, and “Trump is not going to preside over the death of the American equity market to prove a point.”
• The setup was flagged: the Fed’s pause “was not bad for Bitcoin but it was really really really bad for alts,” Avi reminds — he’d hoped specific subsectors would hold; instead everything washed out. Jonah owns his own casualty: he bought AI16Z near the $2.25 highs after its run from 25 cents — “my biggest raspberry of the year.”

2. Inverse alt season is the new alt season

• The regime change, stated flatly by Avi: “capital coming into crypto was good for all crypto — that is no longer the case… basically ever again.” Capital must go to specific projects shipping things, and ETH “has not done anything interesting for four years” since DeFi summer — “that’s why everyone is using it as a short leg now.”
• Avi’s structural frame: the old easy trade — alt season as leveraged Bitcoin delayed a few weeks — is gone; its inverse is the new layup. Too many coins, not enough capital, and IBIT wealth “is certainly not flowing into dog with hat because one’s offchain and one’s onchain.” “The market is handing traders some layups.”
• The specimen short: WIF rallied from $1.50 toward $2 on the Sphere narrative, then it emerged the team had been “collecting retail users’ money” with no hat ever going on the Sphere — “basically a scam… crime fi” — yet the price sat back at $1.50, unchanged from before the news. Bearish news plus unchanged price = short. It’s the biggest short Avi has ever put on in crypto, framed as a hedge against his broader crypto exposure: “I’m still losing money on this move, but I’m losing less.”
• Trend-break discipline validated: Avi’s SUI call — once an altcoin breaks the 50-day moving average “it’s basically done” — played out exactly: broke at $4.50 and “went down in a straight line 50%.” The tweet goes out live: “there are too many altcoins, alt season is a myth, but don’t despair — just short them and supplement your net worth.”

3. Avi calls the bottom and tells Jonah to cover

• The bottom call, timestamped: Avi nibbled Saturday but told the group chat to “wait for Sunday because Sunday is when the crazy stuff happens” — and now he’s “fairly confident that this is at least a short-term bottom.”
• The live disagreement — worth keeping: Jonah resists covering (“whiff is zero now… why should I cover it?”); Avi’s counter is mechanical — down 25% on the day, ~70% in two weeks, “you’re due for some level of mean reversion,” and his standing rule: anything that moves 20% in a day, the position comes off. “This is where you shove… this is where you buy.”
• Jonah’s charitable theory of WIF — “malicious incompetence”: the team probably genuinely believed they’d get the hat on the Sphere, called Vegas, got “who the [expletive] are you, how did you get this number, please hang up” — and then couldn’t confess. “It doesn’t start off as scammy… I’ve seen this sort of malicious incompetence happen a lot.”

4. What to buy: ETF-catalyst alts versus ETH, and quality outright

• Jonah’s opportunity map: ETF-track coins got nuked hardest — XRP “ridiculously hard,” LTC below $100, SOL well off highs — because pre-positioning was just liquidated. Re-enter as pairs: long versus an ETH short leg, “a better risk-adjusted play,” since ETF catalysts are “the last remaining real catalyst in this market outside of Bitcoin catalysts.”
• The battleship rule: hold BTC and buy SOL outright versus USD; only the speculative stuff (an XRP ETF play, Litecoin) goes against ETH. Avi is also accumulating AI/agent coins — “virtuals here is actually a pretty good buy — just hold on and not touch.”
• Quality is the filter: the only green tickers on Jonah’s board are Hyperliquid and Fcoin. Avi: “that’s why hype is $22… there’s genuine real value there” — ETF buyers on Fidelity “are not guys that are rotating capital into your hat coins.” The composite trade: “close your shorts and get long hyperliquid here.”

5. Monero is a Swiss bank in your pocket

• Avi’s sleeper: Monero has outperformed all year and nobody talks about it. The narrative — “Bitcoin but untraceable” — matters precisely because ETF-held Bitcoin is ever more trackable: “there is this old idea that Bitcoin was a Swiss bank in your pocket… it’s no longer true, but Monero is literally a Swiss bank in your pocket.” Caveat: you can’t pair-trade it — it grinds up and outperforms in both directions, so the short leg will hurt you.
• Jonah’s pushback — “allow me to humbly challenge your thesis”: Zcash trades at a $500M FDV versus Monero’s $3.7B, yet Zcash fell 26% today to Monero’s 11%. Avi’s answer: “Monero’s actually used” — plus the conspiracy that Zcash’s founding ceremony was compromised and more supply was minted than known: “why is it literally impossible for this thing to go up?”
• Jonah’s hedge on the whole sector, exactly as hedged: privacy coins “tend to facilitate a lot of crime and terrorism,” so he’s always avoided them and has no view on Monero — but he “could see this scenario being very long-term bullish Bitcoin and very long-term bullish Monero.”

6. Trump walks it back — probably through the backdoor

• Short term, Jonah expects a quick U-turn: the salvo is pain-for-leverage. Avi’s worry is the response — Canada and Mexico “join arms and sing Kumbaya,” and retaliation is bipartisan in Canada (Poilievre too). His deeper read: countries are complying-averse because “if they bend here then it gets much worse” — the asks (fentanyl statements, taking deportation flights) are cheap, yet the pushback is fierce.
• The Iran blueprint, as told: Trump 1.0 exited the JCPOA at max pressure, then Libya lost ~a million barrels a day and oil threatened triple digits — Trump was “between Iraq and a hard place” — so he issued partial public waivers and quietly let Iranian oil sit in Chinese bonded storage, “disappearing from those tanks” into refineries at a discount. Jonah’s bet: “a partial walk-back that makes him still look tough, and then… a super under-the-table thing.”
• Jonah’s regime frame: the post-1945 era of America buying allegiance with soft power is over — now it’s simply “cut the best deals with individual countries.” Jonah’s label sticks: “global cooperationists versus the hedge fund pod shop model of global geopolitics.”

7. Multipolar world, $50 million Bitcoin

• Jonah’s long-term conclusion: weaponizing the dollar against Canada and Mexico nudges them toward bilateral trade in something else — and “Bitcoin just feels like that alternative reserve currency… a dark horse on deck waiting for prime time.” In a world of rival superpowers, “the dollar cannot live in a multipolar world the way that it is right now”; only crude, LNG, gold, and Bitcoin remain relevant — “this thing should be $50 million.”
• Avi’s disagreement, on the dollar only: two offsetting flows — America stays the best place to invest (“the only place to go for investments”), yet states will cut treasury reserves because “you might wake up and they’re not an ally anymore… you thought those were your dollars, they’re actually my dollars.” His verdict: “I don’t have a view on the dollar” — but Bitcoin unambiguously wins, since a multipolar world needs an apolitical, non-governmental reserve.
• Jonah’s tin-foil coda: a possible premium on “virgin Bitcoin” bought direct from miners — fresh wallet, no KYC’d exchange trail, spendable by sanctioned entities on, say, a Venezuelan crude cargo — “a way to make Bitcoin a privacy coin.” His closing calls: Bitcoin, Monero, XRP, LTC, SOL — and, tongue partly in cheek, “short eth to zero.”

8. The tells that topped the market — and what survived the AI washout

• Jonah’s two “very high hit-rate” signals, delivered as the episode’s takeaway: XRP and SOL got CME futures listings and didn’t go up — “everyone’s max deployed… there’s no cash on the sidelines to speculate” — and Bitcoin didn’t rally after the Reserve came out. Jonah’s rule: when good news stops working, “cash is more important right now than it was before.” Yet both close constructive: “a really freaking good time to buy… the good stuff.”
• Avi’s mirror-image addendum: in a bear market, terrible news plus an unchanged price means “the market’s handing you a gift” — watch for death knells where the price hasn’t nuked because “people aren’t paying attention.”
• The AI-coin froth is gone — Zerebro (as heard) went from a $750M to a $46M market cap — but “there are also a lot of projects that are probably really phenomenal buys.” Their own 1000x agent (character files built from podcast transcripts, a terminal promised within three months) is the counterexample they’re shipping: “ChatGPT is garbage for trading,” and building the agent “is basically making me a better trader.”