Crypto founder argues MON’s token model leaves retail exposed while forecasting a liquidity-driven market surge
Hayes Issues Stark Warning on Monad’s Long-Term Outlook
Crypto market commentator Arthur Hayes has raised serious concerns about Monad, the new layer-1 blockchain that debuted this week. He cautions that the project’s token model could trigger a potential 99% collapse, calling it another example of a high FDV, low-float token backed heavily by venture capital. His remarks come as the MON token continues attracting attention following its launch and airdrop.
Hayes: MON’s Token Structure Poses Major Downside Risks
Hayes argued that a large gap between fully diluted value and circulating supply creates an environment where early price spikes are followed by steep selloffs once insider allocations unlock. He warned this pattern has repeatedly harmed retail traders across other new L1 launches.
According to Hayes, many new blockchains experience an initial hype-driven rally, but only a small fraction establish sustainable utility. He suggested that Monad could become “another bear chain” unless it proves long-term relevance.
Monad recently raised $225 million from major investors, including Paradigm, before going live with its MON token. Despite strong early trading — MON is up roughly 40% since launch — Hayes cautioned that short-term performance does not guarantee ecosystem durability.
Liquidity to Drive the Next Crypto Expansion
While critical of Monad’s design, Hayes remains broadly optimistic about the wider crypto market. He believes governments are preparing for aggressive liquidity expansion, which he expects to ignite the next major bull cycle.
He rejected the classic four-year Bitcoin cycle narrative, stating that global credit conditions — not halvings — drive market booms, with Bitcoin acting as an early warning indicator for tightening financial environments.
Hayes predicts that privacy-focused assets and zero-knowledge technologies will dominate upcoming crypto narratives. He expects institutional adoption to grow primarily through the Ethereum ecosystem, propelled by tokenized assets and stablecoin infrastructure.
Earlier this month, he revealed that Zcash has become the second-largest holding in his family office, underscoring his conviction in the privacy sector’s long-term potential.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.