Basic considerations
- Crypto markets have shown resilience despite the downturn in global stock markets.
- Geopolitical tensions, such as in Iran, affect market sentiment and can be classified as war.
- Permanent stoppage of oil production increases the risk of stagflation.
- Market uncertainty regarding monetary policy is at an all-time high.
- Rising bond yields, despite lower expectations, signal market confusion.
- The US approach to regime change in Iran is expected to be mixed and convoluted.
- Investors are encouraged to adopt a long-term perspective that focuses on macroeconomic trends.
- Bitcoin resistance indicates a shift to long-term holdings among investors.
- The long-term outlook for crypto remains positive despite short-term risks.
- A possible 10-15% correction in the S&P could affect the stability of Bitcoin.
- The long-term outlook for the broader crypto ecosystem is as strong as ever.
- The current military situation indicates that the war may drag on.
- Hyperliquid markets are seeing increased trading volume, particularly in commodities.
- Structural problems in trading markets limit risk over the weekend.
- The new revenue disclosure document has raised serious concerns in the crypto industry.
Introduction of guests
Rob Hadik is the general partner of Dragonfly, a crypto-focused investment firm with approximately $4 billion in assets under management. He previously led multi-stage crypto investments at GoldenTree Asset Management, a $50 billion multi-strategy hedge fund, and has invested in fintech and crypto companies across Goldman Sachs, PJT Partners and Heritage Partners. Hadik holds an MBA from Columbia Business School and a BA in Economics and Political Science from Washington University in St. Louis.
Crypto resistance against the background of the global market
- “Crypto has held up surprisingly well despite falling global stock markets.” – Rob Haddick
- “We’ve actually seen, I think, crypto holding up amazingly, despite, you know, global stock markets falling overnight.” – Rob Haddick
- The resistance of crypto markets indicates a shift in investor sentiment towards long-term holdings.
- “It doesn’t seem like crypto markets are as fragile as stock markets are right now.” – Rob Haddick
- The long-term outlook for crypto remains positive despite short-term risks from the stock market.
- “I expect… the long-term setup for… crypto is still very good with the potential to structure the market with several… types of institutions accepting it.” – Rob Haddick
- Bitcoin’s resistance during market downturns indicates a shift to long-term holdings among investors.
- “I actually think it’s quite positive that crypto and bitcoin held up very well over the weekend … it seems … there aren’t necessarily a lot of sellers left … most of the people who are holding now have a long-term perspective.” – Rob Haddick
Geopolitical tensions and economic consequences
- The situation in Iran can be classified as a war based on recent escalation.
- “I think we can call it a war in Iran, you know, at the end of the week that we actually saw.” – Rob Haddick
- The potential for sustained economic risk is increasing due to potential long-term disruptions in oil production.
- “I think even President Trump said yesterday that he expects this to go on for at least four weeks, which if he says at least four weeks, it’s possible that that time frame is actually longer than that, which means there’s a greater chance of sustained economic risk.” – Rob Haddick
- The US approach to regime change in Iran is likely to be complex and confusing.
- “I don’t see that happening in four weeks, especially if the U.S. wants to rely solely on air power as a sort of casualty killer, which I understand again is very difficult to accomplish your mission in a country of 93,000,000.” – Rob Haddick
- The current military situation indicates that the war may drag on.
- “It looks like the pricing is very wrong again like in June … it could be kind of a protracted conflict you know.” – Rob Haddick
Market confusion and monetary policy
- There is considerable uncertainty in the market regarding future monetary policy and political pressures.
- “It’s very clear to me that there’s more confusion in the market now than ever, and you really have different people trading these different markets coming to different conclusions in a way that we haven’t seen before.” – Rob Haddick
- Bond yields are rising despite expectations of lower interest rates, signaling confusion in the market.
- “Yields are actually going up right now, which is what you wouldn’t expect, like bonds, obviously, they’re moving inversely with bond prices, and you’d think bonds would go up with the dollar, but they’re going in opposite directions.” – Rob Haddick
- The risk of stagflation is increasing due to persistent disruptions in oil production.
- “I think the risk of stagflation is even higher, and so from a macroeconomic perspective, I think we’re in a very dangerous time.” – Rob Haddick
- Investors should take a long-term perspective on the market and focus on macroeconomic trends.
- “We’re a little bit different that you probably know some of your audience and the fact that we have a very long view of the market and we think that we’re not going to be in positions and you know you know that at least in a year.” – Rob Haddick
Structural issues in trading markets
- Structural problems in trading markets limit risk taking over the weekend due to market maker hedging problems.
- “These markets still have some structural issues that allow people to take risk over the weekend because of how market makers hedge that risk.” – Rob Haddick
- Hyperliquid markets have seen significant growth in trading volume, particularly in commodities.
- “We’ve seen a significant increase in volume on the commodity side, and you know, some of the prices and things like that, and also the volume of the stock has not been as high as it has been around commodities.” – Rob Haddick
- Traders try to protect against short-term downside while maintaining a long-term perspective.
- “It seems very clear that people are trying to protect your loved ones, like short-term negative or structurally, you know, improvement, which all makes sense to me.” – Rob Haddick
- The market is likely to be rightly pricing in geopolitical tensions.
- “I think the market is probably pricing it very well and frankly there is risk … the stock market is only down a little over a point … Bitcoin was actually up 2% over the weekend.” – Rob Haddick
Problems of regulation and transparency
- The new revenue disclosure document has caused significant concern in the crypto industry.
- “This derivation language was kind of a new thing that got certain people, and Coinbase in particular, actually, you know, and then you know, Brian Armstrong tweeted that, you know, this token, and you don’t know, he’s not happy that he can’t support it.” – Rob Haddick
- The banking lobby has a significant impact on the revenue discourse in the transparency document.
- “Because the banking lobby is so interested in it, they’re the ones driving a lot of this conversation around income.” – Rob Haddick
- The banking lobby is adamant that revenue from stablecoins be passed on to consumers.
- “The banking lobby said well, listen, we really don’t care if transparency happens … no income from stablecoins should be passed on to the consumer.” – Rob Haddick
- Political pressure from the administration could lead to a compromise between banks and the stablecoin industry.
- “If there’s enough political pressure from the administration … for the banks to get somewhere on the same footing here, I think the industry is there.” – Rob Haddick
Venture capital trends in crypto
- Venture capital is best placed in bear markets when prices are low.
- “The VC approach is supposed to work, and it’s very strange that it doesn’t. You have to put some capital when the markets are bad, and you probably shouldn’t put a lot of capital when the markets are good because the prices are higher.” – Rob Haddick
- Venture capital funding tends to increase in high-end markets due to high excitement and more entrepreneurs entering the space.
- “What’s happening is kind of the opposite thing, because you know, you know, more entrepreneurs are getting into the space, they’re excited when prices go up.” – Rob Haddick
- The venture capital space is not big enough to justify investing billions while providing returns.
- “The reason we don’t allow ourselves to get bigger than that, our perspective is that this space is still not big enough that you know you can invest what you call $1 billion and $2 billion and you know protect your return.” – Rob Haddick
- Companies that raise large amounts of capital may not achieve optimal returns due to saturation of investment opportunities.
- “You look at their returns, and I can almost tell you they’re not the best-returning fund in any vertical they’re in.” – Rob Haddick
Long-term optimism in the crypto market
- Rob is optimistic about the market’s long-term future despite the short-term uncertainties.
- “I’m very encouraged by where we’re going over time, but in the short term, you know, there’s a lot that we don’t know right, and so I’m going to continue to be, you know, cautiously optimistic, very optimistic, in the long term.” – Rob Haddick
- The long-term outlook for the broader crypto ecosystem is probably as good as ever.
- “It’s just important to note that you know, and I, because I want you to know, really want to make the point that the long-term outlook for the broader crypto ecosystem right now is probably as good as it’s ever been.” – Rob Haddick
- Now is a good time to invest in blockchain technology startups.
- “I think this is one of the best times to be building in our space, especially around any kind of financial product.” – Rob Haddick
- There are significant structural windfalls supporting the blockchain space.
- “There are a lot of structural headwinds behind our space right now when it’s going to grow steadily, like adoption when it comes to tokenization.” – Rob Haddick
Disclosure: This article has been edited by the Editorial Team. For more information on how to create and review content, see our Editorial Policy.
