😮‍💨 WAGMI

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Happy almost weekend!

Doesn’t it feel good that crypto wasn’t the cause of the chaos this week? Let’s revel in that for a bit. 

While we have a bit of a pause, the macro risks aren’t totally off the table. But right now, It’s time to fully focus back on crypto. After all, a lot can happen in 88 days, right?

Oh and, thanks to Empire’s Santiago Santos, I’m going to be rereading Barbarians at the Gate this weekend. Maybe I’ll follow it up with Too Big to Fail. You know, for old times' sake.

👧 Growing up

The week between the Liberation Day announcement and the 90-day pause gave a good indication of where folks are at when it comes to huge news events that have potential impacts on crypto.

Everyone approaches sudden downturns differently. Some use it as a buy-the-dip moment, some hunker down and prepare for the worst, and others adopt a wait-and-see mindset that allows them to think an action through before an immediate reaction. 

Skale’s Jack O’Holleran would probably say he’s in the third camp, especially as an executive in the industry.

“If you're working in the crypto space, you're making decisions that are short term, that impact days and weeks, but you also have to make decisions that impact months and quarters, and so you have to be planning ahead,” he told me.

“And it frankly, makes things incredibly challenging, knowing that there are all these other variables outside of your control that you can't accurately predict. You have to build volatility and variability into your plan.”

I asked O’Holleran what he thought about fundamentals in crypto, and if we’ve really started to see that shift play out as Blockworks Research’s Ryan Connor believes.

O’Holleran thinks we’re still on the path toward fundamentals. I know we’ve heard the 90’s comparisons a couple of times here on Empire. But O’Holleran pointed out that at the beginning of the dot-com era (before it was a bubble) speculation swirled around the tech even when the products weren’t live quite yet. Crypto’s operating similarly, he noted. 

In crypto, the evolution toward fundamentals will shift into focusing more on project metrics. The industry is in what O’Holleran referred to as “loss leader” mode. 

“People are less concerned about economic values than they are about TVL and trading volume,” he said. 

In “March there was a strong indicator of success at the infrastructure level. Because I think there's a general belief that as incumbents and new players gain market share and build moats, they're going to be able to then increase their profitability, or token value capture.”

And one of the key things we’re building up right now is just how we value different segments in crypto. O’Holleran pointed out that folks are still gauging how something like DePIN or layer-2 projects should be weighted in their categories. 

All of these things reaffirm what may be a bit obvious to us: The industry is really at a maturity inflection point. Prepare for some growing pains, but figuring out metrics to value a project will, in the long run, be a net positive for crypto. 

Bring on the fundamentals.

This interview has been edited and condensed for clarity.

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“The key is survival and the key is positioning yourself to — no matter what happens — optimizing for the peace of mind.”

That’s some sage advice from Empire co-host Santiago Santos this week. 

Santos said this cycle has  “been quite different in that if you didn't have exposure to bitcoin, Solana, HYPE, and one or two other assets, you underperformed the market, you underperformed the benchmark, which is bitcoin.”

Obviously, if you’ve been here for a while, you know that wasn’t the case in previous cycles. 

For Empire’s Jason Yanowitz, this kind of environment is a good buying opportunity for positions that he’s planning to hold long term. 

“There’s probably going to be more extreme volatility,” Yanowitz noted. “But, to me, I think that’s a characteristic of a Trump presidency.”

Mind you all: You should position your portfolio — whether it’s crypto or equities — in the best way for you, but the bullish tone from both Santos and Yanowitz remains. And we have yet another sign that crypto’s maturing.

And now you know. 

Another net positive for crypto was announced last night. 

Nova Labs, the firm behind DePIN Helium, announced that the SEC dropped its suit against the firm just a few months after filing it (in one of Gary Gensler’s final moves).

Nova didn’t get off scot-free; the firm still has to pay $200,000 to settle the SEC’s civil securities fraud charge. Basically, in the original filing, the SEC accused Nova Labs of misleading institutional investors about its partnerships, per a legal filing. Nova Labs didn’t admit to or deny any wrongdoing as part of the settlement. 

On the bright side, Nova doesn’t need to worry about the SEC labeling any one of its three tokens — HNT, IOT and MOBILE — as securities. 

“The outcome establishes that selling hardware and distributing tokens for network growth does not automatically make them securities in the eyes of the SEC. It also means that the SEC cannot bring these charges against Helium again,” Nova Labs wrote in a blog post. 

Overall, though, the settlement can be read as a win and yet another sign of the times. As the SEC moves forward with new Chair Paul Atkins at the helm, we can expect more changes — though it seems that we’re running out of crypto cases to drop or settle.

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Last week, I asked: Will we see an altcoin season like before?

The majority of you — 62% to be exact — think we’re out of luck until the environment improves. Though a few also think that we could use a more selective approach, rather than a broader rally in the segment. Hmm.

Oh, and one single person (yes, I’m calling you out) thinks a rally is on the way. Feel free to let me know if you have a crystal ball stashed away.

This week, I’m wondering: