What Happened To Joyful June?

Summary

• Avi’s core call: the Iran conflict is “a screaming fade” — and oil, not Twitter, is the instrument to read it through. Brent opened above $80 after the US B2 strikes (wick to 81.37) and shanked all day to 74.21, a $6 down day with missiles literally in the air, because the only thing that matters is the Strait of Hormuz and Iran “couldn’t shut the straits even if they wanted to. And they don’t want to.”
• The tradeable mechanic: oil leads crypto. Fear prices into crude gradually as hedgers pile in, then dumps all at once when risk fades — “escalator up, elevator down” — and “a couple of days later crypto and equities are going to rally.” Crypto traders don’t need to trade oil or decode geopolitics; they just need to watch it. The Polymarket 60% odds on a strait closure are “garbage” — the resolution criteria are so vague “you and I could shut the Straits of Hormuz with a Zodiac with a machine gun.”
• Avi’s contrarian read: geopolitics didn’t cause the crypto pullback — euphoria did. Jonah’s market read: the 102K→110K Bitcoin move was pure open-interest expansion, and the war merely told a euphoric market to “cut the euphoria for a little bit.” He expects BTC to range 102–110, possibly touching 92, with alts bleeding throughout: past consolidations at highs (March ‘24: six-plus months sideways; Nov–Feb: sideways then lower) lasted far longer than the ~1 month logged so far.
• Jonah’s active trade: short ETH/BTC back to the lows — stop 8% above the 0.024 level, target 0.019 — plus short shitcoins and buy Bitcoin on liquidation days. His prior calls validate the playbook: he flagged Worldcoin as a short at 120; it tagged 140 (“which you’d have to eat”) and now sits at 82.
• The froth is in crypto equities, not tokens: Circle at a $64–67B market cap approaching USDC’s own market cap on ~$18M of EBITDA is “the most insane mania-driven moment I’ve seen in the equities market… this feels a lot like 1999.” The trade both hosts land on: long Coinbase (or Bitcoin), short Circle — Coinbase at $77B with EBITDA near $1B is “a real business,” Circle is “literally just a funding arb,” and if rates get cut everything rips except rate-exposed Circle. The Aug 1 $350 call on a $270 stock trades at $34 — “freaking rich” to sell.
• Crypto treasury shell companies are “the new ICO” — get in day one, out day two, “keep doing it until it stops working” (Avi’s guess: 3–5 months). Avi says he’s getting pitched all the time on failed-FDA-trial shells turned token treasuries and has declined every one as “a little predatory”; Jonah won’t touch what he can’t map (“if you’re not in on day one, it’s probably already too late”). When they eventually vomit, Avi expects fear to jump to MicroStrategy — but the real answer there is “nothing until 2027,” so contagion is a week-long selloff, not systemic.
• Positioning for the next three months is uncomfortably unanimous: hold Bitcoin and Hyperliquid. “The only problem with that trade is that it’s totally consensus. But it’s such a good trade.” Bull case confirmation from the tape: HYPE traded teflon through the entire geopolitical scare while alts fell 50%.

Deep dive

1. Read the war through crude — “the oil market is already telegraphing the wisdom of the smartest crowd”

• The setup: ballistic missiles inbound at US bases in the Middle East, group chats melting down — and the market doing nothing. Avi’s frame: “crude oil is a pretty efficient lens through which to view this whole conflict. There are a lot of tourists trading crypto on Iran headlines that don’t really know what they’re doing.” Brent (the global waterborne benchmark, not WTI) opened above $80, wicked to 81.37, and traded down-only to 74.21 — a $6 red day despite the missiles — after CL1 had run ~26% bottom-to-top since tensions started in early June.
• The microstructure behind “escalator up, elevator down”: fear prices in gradually as equity traders wake up long airline stocks and buy crude hedges, but almost nobody can short the spike — “let’s say you short oil and they shut the straits for weeks… you’re going to lose your job, maybe your life savings. Oil could go to $200.” So only “a few brave souls with giant balance sheets” fade it, until the hedgers exit en masse and it’s “a big red candle all the way down.” His claim: “we took the escalator up and we’re starting to take the elevator down.”
• The crypto application is the free lunch: none of the listeners should trade oil (“you probably should work at an oil company, otherwise you’re not going to be very successful”), but oil leads crypto — oil rips, crypto sells off shortly after; oil pukes, “you can be damn sure a couple of days later crypto and equities are going to rally.” And the correlation gives traders a chance to get in and out of crypto looking at oil.

2. Iran can’t shut Hormuz — and shutting it would be suicide

• Capability first: Iran is landing maybe 5% of its shots on Israel (90–95% intercepted), and Israel is the size of New Jersey. The strait is far smaller and defended by three US carrier strike groups, a British one, Saudi THAAD batteries and allied interceptors — “there will be more defensive firepower ready to intercept those missiles than if they fire on a random part of Israel.”
• Intent second: the US is no longer a net oil importer, so cutting Gulf supply mostly “destroys the economy of your friend and weapon supplier, China.” And the moment Iran hits the first boat, “it would be kinetic war so fast… it wouldn’t last 24 hours.” Avi’s dismissal of the hedging crowd’s favorite tell: Polymarket’s 60% on a strait closure resolves on criteria so vague “I could — you and I could — shut the Straits of Hormuz and trigger that market with a freaking Zodiac with a machine gun on it. Your real prediction market is oil.”
• Avi arrives at the same place from the battlefield tape: Iran has managed to damage tens of buildings and kill 24 Israelis while “losing across the board,” keeps leaking that it wants back to the negotiating table, and even pre-notified the army bases before this strike “because they need to save face.” Putin publicly begged off — 2 million of Israel’s 10 million speak Russian — and China isn’t coming either. His verdict, held since the start: “it will be a nothingburger”, effectively over and forgotten in a month.

3. Geopolitics didn’t break crypto — euphoria did

• Avi’s revisionist take, worth the price of admission: the war “was like a fun little issue for us to decipher,” but it barely moved equities and isn’t why ETH traded down 25%. Jonah’s market read: the 102K→110K move was driven almost entirely by open interest after the 102K breakout — a mini-bubble that lost its equity-market fuel and now needs a cool-off phase, not an immediate re-send into euphoria. Jonah concedes: “if you’re like me trying to pick a point to add risk, DCA into more crypto — it’s probably not right this second.”
• The historical base rates on consolidation: after the March 2024 peak, more than six months sideways; November–February, sideways then lower. This range is barely a month old. Avi’s expectation: BTC ranges 102–110, potentially even 92, and during digestion “the stuff that isn’t actually good tends to come down a lot.”
• Jonah’s trade: short ETH/BTC back to the lows — stop out 8% above the 0.024 level, target 0.019, “good R/R because I think it’s collapsing” — short the shitcoin complex, and buy Bitcoin on liquidation days like yesterday. Track record cited in-episode: he called Worldcoin a short at 120, it went to 140 first (“which you’d have to eat”), now 82.

4. Circle is the froth — and the pair trade writes itself

• Avi’s tell for a local top: “you’re an utter sign of froth and bubble, but we’re seeing weakness in the main asset… you see weakness in Bitcoin, but you see Circle trading at absurd, absurd valuations. Smells to me like we’re getting closer to the end.” Circle’s market cap ($64B, later quoted $67B) is crossing USDC’s own market cap — “it’s worth more than the market cap of the thing that it’s making 2% on.”
• Jonah’s pitch, which Avi buys: long Coinbase, short Circle, notionally neutral — at $67B vs. $77B, “what’s 10 billion between friends?” Coinbase has EBITDA close to $1B and is a custody solution, an exchange, and an L2 — “a real business” — while Circle earns $18M a year in EBITDA and “is literally just a funding arb.” Bonus asymmetry: if risk rips and rates get cut, “everything rips except Circle,” which is directly rate-exposed. Long Bitcoin/short Circle works too if you fear a 150K melt-up while short.
• The options market is paying you to fade it: with the stock at 270, the Aug 1 $350 call trades at $34 (the July 3 at $15). Avi wants to sell those calls outright; the practical snag is Robinhood requiring them covered. Both note the important limit of the froth call: “funding looks fine, altcoins have just traded off 50% — in the token markets there’s no signs of froth yet. It’s these weird equity plays.”

5. Treasury shells are the new ICO — flip them, don’t marry them

• The specimen: former Coral Capital “hedge fund veterans” Patrick Horseman, Joshua Krueger and Jonathan Pash raising $100M to buy BNB through a NASDAQ-listed shell. Avi says he’s getting this pitch “all the time” — “we have this shell company that failed their FDA trials and we bought it for a million bucks” — and has said no to every one: “I do think it’s a little predatory.” But his honest market call is separate from his ethics: buy the listings day one, flip day two, “keep doing it until it stops working” — his guess, another 3–5 months. Stop using DEX Screener for token launches; read these articles.
• Jonah’s structural objection is the sharpest idea in the episode: this is crypto’s promise run exactly backwards. “The whole point of crypto is to tokenize equities… a farmer in Chad has just as little friction buying IBM stock as a TradFi investor.” Instead, BNB — an extremely liquid token — is being wrapped into a stock-exchange shell “with probably tons of management fees and hidden stuff… a pump and dump structure that’ll undoubtedly be abandoned after 6 months or a year.”
• Why Jonah personally won’t play: memecoins at least mapped to a known game — “it’s hot potato, it’s musical chairs… if you want to analyze what the other investors are doing, just look in the mirror” — whereas here the participant base is opaque. His two rules: “don’t feel shy about missing a trade you don’t understand,” and “if you’re not in on day one, it’s probably already too late.”

6. When the treasuries vomit: a week of fear, not a systemic event

• Jonah’s question — will the inevitable treasury-stock unwind hit Bitcoin bags or stay contained? Avi’s chain: it drags the broader market briefly because fear jumps to the OG treasury stock, MicroStrategy — “and the answer is nothing until 2027, as far as I’m aware.” With little cross-asset holding (“I don’t think people are selling Bitcoin because their Circle is down”), he expects a few days to a week of smart-money-driven selloff, all else equal — but concedes Circle’s $64B “represents a decent amount of money that got pushed into this thing.”
• Exhibit for how unfiltered this market is: Tron “going public” via SRM Entertainment, up ~650% since the announcement — and you could still buy it 50% up, an hour after the news, because participants “don’t have a good filtering mechanism.” Jonah: “it feels like investing in pets.com in 1999… this is the JT Marlin securities of our time.” Avi’s mock grievance: “Justin Sun did not tell me he was doing this. Shame on you, Justin.”

7. The next three months: Bitcoin and Hype — plus Roman Empire nostalgia for FTX

• On the how-do-you-make-money menu (hold BTC / cycle treasury shells / trade alts), both land on the Twitter consensus: hold Bitcoin and Hyperliquid, which “has been trading teflon” through the whole scare (Syrup “hanging in there,” Worldcoin still going down). Jonah: “maybe take 5% of your portfolio and screw around with these treasury companies just to learn something… but the odds are so much better in Bitcoin and Hyperliquid. The only problem with that trade is that it’s totally consensus. But it’s such a good trade.”
• Avi’s closing riff, from Sicily: walking around Rome’s ruins feels like crypto post-FTX — “we used to build some incredible things… 3x levered tokens for every asset under the sun, prediction markets, Bitcoin at 100x leverage, BMX token as collateral, and everything was fine. Somebody go out there and build that.” The ability survived; the willpower didn’t. Bybit gets respect for taking a stab (it messaged Avi about launching commodities), as does Hyperliquid.
• Avi’s build-this wish is specific: tokenized commodities are “the real grand slam” — bringing perpetual futures to markets like crude and breaking the ICE/CME duopoly “will be huge, huge, huge for retail investment in commodities.” Tokenized stocks matter for the offshore crowd; until then, TradFi platforms remain “a horrendous pain in the ass compared to trading on crypto-native platforms.”