Even the dumbest can sense that the crypto industry is at a turning point.
Over the past decade, the core competence of the crypto world has been asset issuance. Launch a chain, launch a coin, launch a governance token, launch an economic model, push it to the market with narratives, airdrops, liquidity incentives, and community consensus, a game of passing the parcel.
We once boldly hypothesized that blockchain would create a brand new asset system: new currencies, new financial protocols, new gaming assets, new social networks, even new forms of organization.
Yet now, these native assets are heading towards a slow death, turning every attempt to buy the dip into a futile struggle.
What's sucking away liquidity and attention are old-world assets: US stocks, US Treasuries, gold, crude oil, indices......
Say Bye Bye to all native assets, and Say Hi Hi to traditional assets
The protagonists on-chain have changed. Native assets are ignored, while mirrored assets are all the rage.
Every bear market, someone says 'ETH is finished,' 'no one is buying alts anymore,' 'no one is playing with DeFi anymore,' but why is $2000 ETH more despair-inducing than it once was at $200?
Because the grumbling no longer stems from price cycles or shifts in sector narratives, but from a migration in the industry's function. The crypto industry is shifting from its former role as a 'new asset factory' to becoming a 'global asset pipeline.'
Stablecoins are the earliest and most successful example. The widespread adoption of USDT and USDC clearly isn't about crypto defeating the dollar, but rather the crypto world finding a more efficient way for the dollar to circulate on-chain.
Over the past decade-plus, countless projects have shouted slogans about 'creating a new monetary system.' In the end, only stablecoins achieved mass global usage. Because besides gamblers like us, ordinary users aren't fixated on digging up a new world currency; they only care about making the dollar move a bit faster, a bit cheaper, a bit less restricted by time and geography.
Thinking back, this essentially sentenced crypto-native assets to their fate long ago.
The ability of blockchain that ultimately proved itself at scale was not value storage, not governance, nor any other convoluted financial innovation, but its original functions: peer-to-peer transfers and global settlement. Long live Satoshi Nakamoto.
Apart from Bitcoin, the value storage function of other cryptocurrencies has been disproven. These assets are wildly volatile, generate thin cash flow, have ambiguous governance rights, and their demand stems entirely from speculation.
After all this circling, the market returns to the blockchain's primal, humble functions: transferring, settling, cross-border movement, collateralizing, trading.
Altcoins? Even dogs won't play with them
The awkwardness of crypto-native assets, a.k.a. alts, also becomes clear under this logic.
When hot money rushes in, we compare assets within the crypto bubble and ape into one that looks promising. Layer 1s compare TPS, DeFi protocols compare TVL, Memes compare community hype. Everyone soaked in the same narrative pool, none with much real-world anchor, every story having its space for imagination. As long as it was packaged grandly enough, a new token could pre-price a decade's worth of valuation.
But now, internal narratives are exhausted, external wealth effects are everywhere, and even sticking one's head in the sand doesn't work anymore.
On one side, real-world assets like US stocks, gold, crude oil are placed in the same on-chain trading interface; on the other, AI has burst into everyone's lives in a way that's almost like science fiction becoming reality.
The crypto world used to excel at selling the future, earning valuation premiums through a sense of 'futurism,' talking about new networks, new finance, new organizations, new production relations. But after many years, those narratives remained confined to whitepapers, roadmaps, funding news, and token prices. Meanwhile, AI, besides its powerful narrative, has already become a tool readily available in everyone's computers and phones.
Before, an altcoin only needed a more compelling story than another altcoin. Now, it must face two types of external rivals simultaneously: one is traditional assets with genuine cash flow, asset backing, and a global pricing system; the other is a new tech cycle in AI, which has both futuristic narratives and real-world products.
Here, these garbage coins with no revenue, no demand, and no value capture stand next to Nvidia, Micron, crude oil, and AI applications. It's truly an ugly sight.
Ethereum is in trouble
The frequently discussed 'Ethereum problem' recently should also be viewed within this framework.
Ethereum isn't just facing short-term pressure from its roadmap and liquidity; it's that the 'native asset worldview' it once represented has been squeezed out.
On one side, traditional mirrored assets are entering on-chain; on the other, AI dominates the global tech narrative.
Ethereum remains vital infrastructure for on-chain finance and asset issuance, but stripped of the 'native crypto' innovation universe and the worldview's faith support, ETH's own ability to capture ecosystem value becomes meager. Users can pay on Base, trade on Arbitrum, move assets between rollups, and trade US stocks on-chain, but they certainly don't need to hold ETH for that.
The same goes for DeFi. Its initial grand narrative was rebuilding the financial system, but not much of a real, rigid demand solidified.
Users don't need a complete suite of on-chain banks; they need cheaper dollar transfers, faster settlement, deeper liquidity, and tradable price volatility. Lending, DEXs, yield aggregators still exist, of course, but they increasingly resemble parts of the infrastructure, struggling to single-handedly bear the industry's imagination. The 'financial Lego' narrative has become a relic of the last cycle.
The protagonist has become the asset itself
The crypto world has to admit that on-chain finance doesn't need to reinvent Nvidia, let alone reinvent the dollar; of course, we don't have that capability.
We just need to strive to make these assets transferable, tradable, collateralizable, shortable, leveragable, and combinable into new financial structures more freely.
So, when we say crypto is dead, we mean the era that relied on the constant inflation of native assets has ended.
No one dares talk about the crypto industry disrupting old finance anymore. Practitioners are now busy installing a new transport layer for traditional finance. US stocks are still US stocks, but through new infrastructure, they can have 24/7 trading, global liquidity, on-chain settlement, permissionless access, and composability. The industry is going all out to produce a new API for the old world.
Actually, on-chain US stocks, RWAs, on-chain perpetual contracts—these are nothing new.
The industry didn't just think of moving traditional assets on-chain today, nor did it just think of trading everything with perpetual contracts today.
Years ago, there were waves of Perp DEXs, synthetic assets, on-chain stocks, and projects trying to bring traditional assets on-chain. Looking back at some early protocol designs, you'd find their underlying mechanisms aren't fundamentally different from many hot projects today.
That's also why some old players look down on Hyperliquid and missed the opportunity. Kyle Samani's persistent bearishness on Hyperliquid is a classic example.
He hasn't just never seen this thing; he saw it too early and too much, got sick of it. Five, eight years ago or even earlier, many in the industry tried to build on-chain futures exchanges, tried to make decentralized derivatives, tried to trade all asset categories, but they failed one after another.
I recently dug up an article our Odaily published about a PerpDEX project in 2020. Honestly, the mechanisms are no different from now.
The issue isn't the direction; it's always the Timing.
The industry's shining star: Hyperliquid
In its early days, Hyperliquid also had a rough experience, mediocre liquidity, and was heavily criticized for regulatory risks. But it successively rode the waves of change, becoming the biggest beneficiary, leaving latecomers in the dust.
The first wave was the 'CEX-ification' of on-chain Perps. Hyperliquid's earliest highlight wasn't just being another Perp DEX; it was making on-chain futures trading feel less like DeFi and more like a centralized exchange. Order books, low latency, APIs, rebates, ecosystem frontends, HYPE airdrop, no VC, community wealth effect—all these combined pushed it from an on-chain protocol to a main trading venue. This phase wasn't sexy, but critical. The hardest part for a trading platform is the first bite of liquidity. People need to come trade, then market makers follow, and only then can it handle larger asset volumes.
The second wave was the trust transfer after 10.11. The black box risks of centralized exchanges were exposed again. Since then, many whales preferred open博弈 on-chain against everyone rather than being trapped and liquidated in a dark forest system where they couldn't see their real opponents. 'Decentralization' isn't just a slogan; it's traders' practical need for 'dying with clarity' in extreme market conditions.
The third wave was the volatility of macro assets like gold and crude oil. War and geopolitical conflicts pulled global markets back into macro narratives. Users started needing a venue to trade global assets 24/7. Traditional markets have opening and closing hours, regional restrictions, account restrictions—on-chain perpetual markets don't have these burdens.
The fourth wave, no need to elaborate much, is the explosion of US stock trading. When popular assets are placed in a 24/7, global, low-barrier perpetual market, the assets themselves bring traffic, traffic attracts B-side market makers and ecosystem frontends, market makers and frontends in turn enhance liquidity, entering a snowball effect.
So, understanding it early doesn't guarantee big results. Actually, we all know: in the past, there weren't enough on-chain users, wallet UX wasn't mature enough, market-making infrastructure wasn't sufficient, and asset volatility lacked big external opportunities. Building a big ship when there's no wind gets you nowhere, just stranded.
The sinister yet fascinating perpetual contract!
Finally, let's talk about crypto's greatest invention—the perpetual contract.
If trading spot US stocks, you face a whole set of complex issues: compliance, custody, underlying asset mirroring, trading hours, settlement, equity rights, dividends, corporate actions. Every link involves the old financial system; every link can become a bottleneck.
But if trading US stock Perps, the platform only needs to build a contract pool around the price. Liquidity can be provided by ecosystem partners. Users are trading price exposure, not directly holding the underlying equity.
It bypasses the heaviest parts and captures the part with the most trading demand.
This, of course, is also where its sinister nature lies. Perps reduce an asset to a price symbol you can bet on, compressing complex ownership relations into long/short directions and leverage multiples. It doesn't care if you own the stock, nor if you understand the company's value. It only cares if the price is volatile, if someone wants to go long, if someone wants to go short.
This is also its most vital, fascinating aspect.
People don't necessarily want to own Nvidia, but they want to trade Nvidia's volatility; people don't necessarily want to hold gold, but they want to bet on gold's direction; people don't necessarily need crude oil, but perhaps they need the risk exposure from crude oil prices.
Perps distill this demand to the extreme. They don't create new assets, only new casinos; they don't provide ownership, but provide risk exposure; their goal isn't to restructure the financial world, but to turn every asset into a 'price' that can be traded 24/7.
So, if we look back on the entire crypto history in the future, the product that truly remains is probably Perps.
From a financial theory perspective, it's even somewhat absurd. Futures have expiration dates because, in the past, assets ultimately needed to return to the real world. Perpetual contracts eliminate expiration, turning a product with a finite lifespan into one that exists eternally. This is probably the ultimate revelation after the crypto world issued its junk assets.
Traditional exchanges have opening and closing because markets need rest; perpetual contracts eliminate rest, keeping the market always online. Traditional finance relies on brokers, clearinghouses, and regional regulatory systems, while perpetual markets inherently cross borders.
The perpetual contract might be the most successful, yet also the most dangerous, financial innovation in all of crypto history. It truly resembles a financial monster unleashed by a demon. (Arthur Hayes: Blame me?)
Countless people have been liquidated because of it, countless wealth evaporated because of it. It amplifies humanity's most greedy side. But at the same time, it has also created unprecedented liquidity and price discovery efficiency.
Conclusion
Looking back, years in the blink of an eye, crypto's most successful currency is the dollar, its most successful asset is Bitcoin, its most successful application is trading, and now its most 'promising new growth' comes from US stocks.
This is a defeat for idealists, and more likely, the market finally completed its selection.
The tale of the seas changing is old. Humanity's chase for wealth, preference for risk, infatuation with leverage has never changed. So today's crypto industry no longer obsesses over inventing new assets, but tries to turn existing assets into tradable pairs that are always online, globally reachable, and permissionless.
Crypto is dead, Perps are forever.
