High FDV and Low Circulating Supply: A Hazardous Combination

Speaking on Altcoin Daily, the former BitMEX CEO described Monad as a classic example of a “high FDV, low-float VC token.” Fully Diluted Value (FDV) represents the valuation of a project if all tokens were already released. Hayes emphasized that when there is a significant gap between FDV and the available circulating supply, the imbalance often creates dangerous market dynamics.

He noted that such projects typically see an early price surge, only to experience aggressive selloffs once insider or investor allocations begin unlocking. In his view, Monad fits this pattern: a token that might enjoy an initial rally but lacks evidence of long-term sustainable demand. “A strong early pump does not imply lasting utility,” he cautioned.

Most Layer-1 Networks Fail to Survive

Hayes further argued that only a select few layer-1 protocols will maintain relevance over time. Historically, he said, new networks struggle to secure meaningful adoption. For the next market cycle, he believes only Bitcoin, Ethereum, Solana, and Zcash stand a realistic chance of remaining dominant.

Monad, meanwhile, raised $225 million in a funding round led by Paradigm last year and officially launched its mainnet recently, along with its native MON token.

Liquidity Expansion Could Ignite the Next Bull Market

Despite his skepticism toward Monad, Hayes maintains a broadly bullish outlook for the crypto market. He expects global liquidity to expand as the United States enters a politically charged period and economic growth softens, potentially prompting renewed monetary easing. He argued that the market is still in the early stages of this cycle, with major liquidity-driven rallies yet to unfold.

He also downplayed the traditional four-year Bitcoin cycle narrative, asserting that previous booms were shaped not by halvings but by global credit expansion led by the U.S. and China.

Privacy Technologies Set to Lead the Next Narrative

Looking forward, Hayes anticipates that privacy-focused solutions will play a central role in the next major trend. He expects zero-knowledge technologies and privacy coins to attract renewed attention, while institutions increasingly gravitate toward Ethereum for stablecoin and tokenization infrastructure. He also revealed that Zcash has become the second-largest holding in his family office, Maelstrom.

What is Monad Coin (MON)?

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Trump Jr. and Polymarket Connection

Trump Jr. joined 1789 Capital as a partner last year. Now, in addition to backing the company financially, he has also taken a seat on Polymarket’s advisory board. This move comes at a pivotal moment as the platform prepares for broader entry into the U.S. market.

Regulatory Developments in the U.S.

Currently, American users are not allowed to access this prediction market platform. However, things may soon change. Polymarket recently acquired derivatives exchange QCEX for $112 million, securing a CFTC license in the process. The company also announced that investigations by both the Department of Justice and the CFTC have been closed. These probes previously included an FBI raid on CEO Shayne Coplan’s apartment last November.

1789 Capital’s Investment Strategy

Sources say that Omeed Malik, founder of 1789 Capital, and Coplan began discussions about 18 months ago. Still, the firm waited to invest until a clearer regulatory path emerged for U.S. expansion. 1789 Capital, which already holds stakes in major companies such as SpaceX and Anduril, sees Polymarket as a strong candidate for a future IPO.

Trump Jr.’s Link to Rival Kalshi

An interesting twist is that earlier this year, Trump Jr. also took on a strategic advisory role at Kalshi, one of Polymarket’s competitors. This position, however, is a paid advisory role rather than an investment, meaning Trump Jr. currently maintains involvement with both sides of the prediction market space.

Polymarket and Kalshi both drew national attention last year when users on their platforms predicted a Trump election victory, in contrast to many traditional pollsters. This latest investment highlights the growing relevance of digital prediction markets and their potential role in the future of finance.

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Strive Funds Leads the Quarter

This resurgence indicates a renewed appetite from investors, especially after a relatively quiet period in the crypto space. Topping the list of recipients this quarter was Strive Funds, founded by American entrepreneur and politician Vivek Ramaswamy. The firm raised a massive $750 million in May to support Bitcoin-focused alpha-generating strategies.

Following closely behind, TwentyOneCapital secured $585 million in April, ranking as the second-largest raise of the quarter. Other major recipients included Securitize ($400 million), Kalshi ($185 million), Auradine ($153 million), ZenMEV ($140 million) and Digital Asset ($135 million) — all contributing to the sector’s strong momentum.

Coinbase Ventures Tops Q2 Activity

On the investment side, Coinbase Ventures emerged as the most active investor in Q2 2025, participating in 25 deals between April and June. Close behind were Animoca Brands, Andreessen Horowitz (a16z) and Pantera Capital, continuing their strong support of the blockchain ecosystem.

In June alone, Coinbase Ventures led with 10 investments, followed by Pantera Capital (8), Galaxy (5), and Paradigm, which made 4 strategic deals. Other notable participants included Cyber Fund and GSR, showcasing a healthy mix of venture activity across different stages and sectors.

Key Focus Areas: Blockchain Infrastructure & DeFi

Funding was distributed across various sectors, but blockchain infrastructure and decentralized finance (DeFi) captured the majority of attention. While CeFi, NFTs, and GameFi continued to receive moderate levels of support, memecoins saw limited traction, with occasional spikes in activity.

Early-Stage Rounds Dominate Fundraising

Out of the 1,673 deals tracked over the past year, seed-stage rounds accounted for the largest share at 19.43%. This was followed by strategic rounds at 14.23%, reflecting continued interest in ecosystem-building and long-term plays. Pre-seed (9.26%) and M&A deals (9.44%) also played notable roles in shaping the capital landscape.

Series A rounds made up 6.34% of the total, while incubation deals remained less frequent at 3.35%, according to CryptoRank data.

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Venture Capital Deals Dip Sharply in May

According to data from RootData, only 62 funding rounds were recorded in May—matching levels last seen in early 2021. It’s a stark indicator of how cautious investors have become in a shifting macro and crypto landscape.

Still, these limited rounds managed to bring in $909 million, making May the second-highest month for funds raised this year, trailing only behind March’s $2.89 billion across 78 deals.

Market Sentiment and Global Headwinds Take a Toll

Several industry experts point to a combination of factors behind the decline. After peaking in late January, both market sentiment and prices saw only a modest recovery in April. By late May, tensions around tariffs and ongoing economic uncertainty further dragged on risk appetite.

Persistent high interest rates, volatile bond markets, and growing geopolitical risks have also made it harder for new deals to cross the finish line. Much of the activity observed is now focused on consolidation, which tends to dominate during sideways markets.

Bitcoin Still in the Spotlight

While most crypto assets have underperformed, Bitcoin continues to stand out. It remains a rare bright spot in an otherwise sluggish environment, drawing consistent attention from institutional players and long-term holders alike.

M&A Activity Holds Firm

Even though VC deals slowed down, mergers and acquisitions (M&A) stayed strong. On May 8, Coinbase announced a $2.9 billion acquisition of derivatives exchange Deribit—a transaction that set a new record as the largest crypto M&A deal to date.

Experts suggest that as regulatory clarity improves, large-scale players are opting for direct acquisitions and strategic partnerships rather than relying on VC pipelines. This trend could shift capital flows toward more structured deal-making in the near term.

Seasonal Slowdown or Structural Shift?

According to RedStone’s co-founder Marcin Kazmierczak, the current lull might reflect typical seasonal patterns. May and June are often quiet months in venture markets. However, history shows that activity tends to rebound in early Q4, as investors return from summer and look to close high-value deals before year-end.

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Using the example of Solana, Snowden discussed the impact of venture capital (VC). He mentioned that Solana was “born in prison,” referring to its heavy reliance on VC funding. According to Snowden, this kind of financial backing can limit a blockchain network’s independence and decentralization goals.

Despite Solana’s rapid growth, Snowden expressed concerns that too much control by large investors could undermine decentralization principles. However, he acknowledged that Solana could still “become something” in the future.

A significant portion of his talk focused on decentralization and the impact of AI-driven surveillance. Snowden warned that AI-enhanced surveillance systems could increase the real-time processing of personal data, potentially enabling large-scale data analysis. He said:

“They want to train it on everything, and then they want to be able to say, you know, who looks anomalous. Look at everybody, look at the whole human body, and pick out anybody who is weird.”

Snowden also discussed the influence of VC investments by referencing Andreessen Horowitz (a16z), which voted against a proposal to deploy Uniswap v3 on BNB Chain. The venture capital firm used its 15 million Uniswap (UNI) tokens to outweigh the initial 20 million “yes” votes, highlighting how large stakeholders can dominate decentralized projects.

Finally, Snowden emphasized the importance of decentralization and privacy in emerging technologies like blockchain and AI, stressing that these principles need to be safeguarded as the technology develops.

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