Eric Conner: The 52 Month DeFi Bear Market Is Over (Full Thesis)

Eric Conner says the roughly 52-month DeFi bear market is over, with regulatory headwinds turning into a potential tailwind, and describes the market as shifting from pre-bull to bull. He does not regard the rally two or three years ago as a genuine bull market. The current leadership is unusual: perpetual-futures tokens and Zcash have outperformed while major assets lagged, a degree of decoupling from Bitcoin he says he has not seen in 14 years of watching markets. A sharp Bitcoin decline could still drag the broader market down, though he is unsure whether perpetual-trading tokens would remain weak.

Conner expects multiple perpetual-trading platforms to succeed and holds both Hyperliquid (HYPE) and Lighter. He describes Hyperliquid as larger by market capitalization, with more open interest and a broader global presence, while Lighter is more US-focused. Regulatory developments, including CFTC activity, may help determine which platforms win. He sees always-open perpetual markets as a straightforward product to explain to mainstream users and Wall Street. He also regards Lighter’s fast trading and user experience, backed by Ethereum security guarantees, as consistent with Ethereum’s values.

Conner has raised his Ethereum price target to $20,000 despite being very underexposed to ETH for two years. He argues that ETH does not need a separate investment thesis, because price can lead narrative and successful projects can draw activity to the network and buyers to the asset. He points to Robinhood’s decision to build Robinhood Chain on Ethereum, saying composability can make it easier to integrate partners such as Lighter and Uniswap. He also cites meme-stock pools routing millions of dollars of liquidity to Robinhood’s tokenized stocks as an example of activity that Ethereum-based infrastructure can support.

Conner expects traditional finance products to move on-chain eventually, but says the timing is unknown and the structure of tokenized shares needs scrutiny. Robinhood has said each on-chain share is backed by a custodian, but he wants that arrangement confirmed; he is also unsure whether AMC’s CEO objects because shares might not be individually custodied and could create synthetic shares used to short AMC. Shareholder rights and redemption terms remain unclear. Conner thought Coinbase stock tokens offered somewhat more rights than Robinhood’s, which he thought were likely debt instruments, but acknowledged he did not know the details. Robinhood voting rights and in-kind redemptions had been discussed, although redemption was not yet available.

CFTC staff guidance was interpreted as opening a path for tokenized assets and qualifying crypto to serve as collateral in regulated derivatives markets. Using tokenized stocks as collateral or margin could enable borrowing and yield-generating activity, potentially expanding on-chain markets. Conner recalled Robinhood Chain revenue at roughly $300 million to $500 million annualized, while warning that he might be misquoting the figure. He sees tokenization, rising chain volume, and fees as a possible early-stage tailwind. Reported trading figures illustrate both interest and risks: tokenized Hims shares reportedly reached 10% of trading on one day, and their Robinhood price rose to about ten times the stock’s price during a Saturday supply shortage before market makers added shares. Conner and Robbie differ in emphasis on what limited supply implies, but Robbie argues that if shares are not synthetic, moving more of a finite inventory on-chain leaves fewer available off-chain.

Conner calls meme stocks his current investment thesis, following digital asset treasuries as an earlier corporate entry point, and expects major stocks could each develop a retail community that serves as a marketing arm. He cited Boner coin’s roughly 20,000 followers and a reported day when it made up 10% of Hims’ on-chain volume; activity in the Boner coin and Hims pools can reinforce their prices. Robbie expects decentralized venues to keep gaining share relative to public brokerages and eventually overtake them, while noting that Uniswap and perpetuals platforms are gaining volume. A portfolio thesis discussed on the episode pairs hard-money assets, especially Bitcoin and Zcash, with revenue-generating tokens such as Hyperliquid and Lighter, though those tokens have become crowded. Conner says he has not sold his ZEC and has sold little or none of his HYPE, Lighter, and NEAR, preferring to hold through volatility for years. He also notes that large ETF flows have sometimes coincided with little price movement, without claiming to know why.