Crypto veteran Arthur Hayes says layer-1 Ethereum (ETH) rivals saw their first big test last bull run and face another test amid the crypto market collapse.
In a new interview with Real Vision’s Raoul Pal, Hayes says that while Ethereum competitors may have been able to demonstrate their technical capabilities, they now have to show that they can attract and maintain users.
“The question now is, okay, well, you guys have advertised this very, very fast transaction speed. Great. Show me the applications that are used by at least some people doing stuff. That’s the question right now is like, you have to have users that are willing to spend real money and not just receive inflated tokens. I think that’s the question that all investors, and me as well, are just looking at new projects and [saying] ‘Okay, well show me the users. Show me somebody willing to pay real money to use your service.’ I think that’s where we’re at right now.”
The BitMEX co-founder says that in the next bull run, he’s going to be looking at crypto assets that he thinks have a good shot of at least surviving and maintaining a presence in the markets rather than fading off into obscurity.
“I guess you use survivorship bias. Okay, if I’m looking at a top 20 market cap asset, and it’s down 95%, will it survive to the next cycle? Will it survive the next two years? How much money did they raise? If the answer is yes, buy it. Worst case, it goes down to zero. Best case, it goes up a 10x, 20x.
If it went from 100 to one and it goes from one to 10, it’s a 10x. Still isn’t anywhere near where it was, but I’m just playing the rebound. And so you know that on the rebound of crypto when the next cycle begins, everything that fell the most is going to rise the most just by the path of dependency of how returns work. So yeah, I guess this doesn’t change in most of these things. Most of them will fail, you don’t really care, it’s really just a numbers game.”
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