Crypto’s Flow-Driven Market Has Arrived | Shaundadevens & Kunal Doshi

Shaundadevens identified ETF inflows and MicroStrategy buying as the two structural demand drivers for BTC over the prior year, but noted that over the last 28 days ETFs turned net sellers while Michael Saylor remained the only significant buyer, removing a key demand pillar even as Saylor ran record buying activity. Kunal Doshi added that retail capital is rotating toward semiconductor and AI plays, the S&P 500 is at an overbought level with the put-to-call ratio heavily skewed toward calls, and both speakers agreed a major equity pullback would likely drag BTC lower with it.

BTC's structural advantage as the only crypto asset with a TradFi flow funnel via ETFs no longer holds exclusively, as more assets have received ETFs and discretionary allocation tokens have migrated from BTC to ETH and now to Hyperliquid. The Bitwise and 21Shares Hype ETFs launched in the US and in the first 10 trading days accumulated 1 percent of circulating supply, compared to 0.6 percent for BTC ETFs at their launch, making it the strongest crypto spot ETF debut on a relative basis. Hyperliquid Strategies disclosed buying 82 million dollars of Hype in the prior week while also increasing cash holdings by 43.4 million dollars, meaning DAT strategies accumulated roughly 40 days worth of assistance fund flows in a single week. Assistance fund cash holdings now stand at 126 million dollars and DAT strategies are trading at approximately 1.2 times NAV premium.

Kunal Doshi argued FDV is the wrong metric for Hyperliquid because the 38 percent of supply earmarked for future emissions is unlikely to be released and should not be treated as supply that will be sold. He said the correct framework is to assess structural demand from ETFs, the assistance fund, and DATs. He also distinguished the Hype situation from the ETH DAT experience by noting Hype already had strong revenue, an assistance fund, and upward price momentum before DAT accumulation began, and predicted that when DATs exhaust their capital Hype will likely enter a range rather than produce the telegraphed top that ETH exhibited when its DAT ran out of money.

The Morpho Midnight white paper proposes a non-custodial protocol for fixed-rate fixed-term credit markets using isolated permissionless markets and fixed maturities. Kunal Doshi identified the most plausible near-term use case as a Coinbase integration allowing retail users to deposit BTC as collateral and take out a fixed-rate USDC loan or earn a fixed USDC yield such as 4 percent for three months. Shaundadevens noted Morpho has close ties to Coinbase and predicted material flows into the protocol over the next six months, though Doshi cautioned there is no clear indication yet of when Morpho Midnight will go live. On valuation, Morpho was trading at over 100 times price to sales assuming a 10 percent take rate while Aave, Camino, and Oiver traded around 17 to 18 times and Sky, Maple, and Spark closer to 10 times. Morpho currently charges no fees yet its fully diluted valuation exceeds both Aave and Sky despite those protocols generating around 140 million dollars in annualized revenue. Doshi said a higher multiple for Morpho is justified given the Coinbase integration narrative but not a 10 times premium over peers, and added that until Morpho turns on a fee switch the token could continue to rally on narrative alone.

Athena's stablecoin supply peaked at 17 billion dollars in September 2024 and has since fallen to just above 5 billion dollars, with yields compressing to around 3 to 4 percent from slightly under 10 percent at the peak. The basis trade gap between spot and perp has closed, funding rates turned negative in certain periods, and Athena has progressively reduced its allocation to that strategy. A growing share of reserves is now held in USDTB earning treasury yields, effectively making Athena function as an on-chain asset manager rather than a yield-generating protocol with a distinct edge. Shaundadevens characterized this current state as effectively a stablecoin wrapper, which he views as bearish.

Athena's diversification paper outlined alternative strategies including a gold basis trade, institutional lending, and CLOs via Centrifuge, but Doshi identified scalability as a hard constraint. At five billion dollars in assets there is insufficient order book depth on exchanges including Binance and Hyperliquid to run meaningful basis trades in gold, equities, or SOL, and Athena's attempt to onboard SOL never exceeded roughly 0.5 percent of reserve backing. Even with full diversification, yields would likely stabilize around 4 to 5 percent. Maple's Syrup USDC and SKY's USDS have outperformed Athena over recent months using simpler and more transparent strategies, and treasury yields of 3.5 to 4 percent already offer a safer alternative at similar returns, undermining Athena's value proposition.