On May 21, David Hoffman, co-founder of Bankless and the most vocal evangelist of the Ethereum ecosystem for six years, posted a tweet in the early hours saying something like, "The vibe on crypto Twitter has really changed, and he sold his last bit of ETH."
Three and a half months later, he's come out as the big winner.
What Exactly Did Hoffman Buy?
In early June, Hoffman fully disclosed his portfolio rotation strategy on X, deploying the funds from his ETH liquidation in two tranches:
The first tranche, roughly 50% of the capital, was immediately allocated to four assets after selling ETH: VVV (Venice AI's governance token), NEAR, ZEC, and HYPE. He explicitly mentioned in his tweet that he bought NEAR at around $1.4.
The second tranche, roughly 50% of the capital, was reserved for DCA (dollar-cost averaging) purposes. His exact words were, "Keep it to slowly buy something that hasn't pumped yet." This money ultimately all went into LIT (Lighter, a zkRollup-based on-chain perpetual exchange token).
His investment thesis for LIT was exceptionally clear: exchanges are always the best business model in crypto; Lighter's buyback speed is roughly twice that of HYPE; zk circuits allow users to permissionlessly verify that the exchange follows its own rules; the product offers lower latency, a better fee structure, and supports more assets including the Pre-IPO market.
When asked, "How do you choose between LIT and HYPE?" his answer was that LIT is both HYPE's Beta and its Alpha. He even posted a dedicated tweet in late June expressing regret over not buying more LIT.
This is a remarkably clear investment framework: betting on the privacy narrative with ZEC, betting on the structural growth of the on-chain derivatives sector with HYPE and LIT, betting on cross-chain infrastructure and the AI Agent narrative with NEAR, and betting on decentralized AI inference with VVV.
Five assets spanning four narrative tracks, none of which have anything to do with Ethereum L1 valuation.
Report Card
Let's compare the prices before and after Hoffman's disclosure of his positions. He sold ETH in late May, with the first batch of entries occurring from late May to early June, and the LIT DCA lasting until mid-June. Below, approximate prices from early June are used as the entry benchmark for each asset, compared against the latest prices in early September:
ETH: Sold at approximately $2,100 → currently around $2,450, an increase of roughly 17%.
ZEC: Entry price around $540 → currently breaking above $1,200, an increase of over 120%.
On September 6, it briefly touched $1,200, doubling in three months. The catalyst behind this was Grayscale's ZEC spot ETF (ZCSH) launching on NYSE Arca on August 25, with AUM swelling from $300 million to $460 million within two weeks of listing, compounded by a short squeeze that liquidated $46 million in short positions.
HYPE: Entry price around $56 → currently around $87, an increase of roughly 55%.
On September 6, it hit a new all-time high of $89.54. Hyperliquid's token burns have now surpassed $4 billion in cumulative value, with daily average protocol revenue holding at $2.26 million. This on-chain cash cow's earnings power continues to accelerate.
LIT: Entry price range of approximately $1.5-$2 (DCA average) → currently around $4.7, an increase of roughly 135%-210%.
On September 5, it hit a new all-time high of $4.95. As Hoffman's heaviest single position (accounting for 50% of total capital), LIT contributed the largest absolute gains to the entire portfolio.
NEAR: Entry price around $1.4 (confirmed by Hoffman himself) → currently around $2.37, an increase of roughly 69%.
VVV: Entry price range of approximately $16-$18 (in early June, VVV was near its ATH zone, hitting an all-time high of $21.32 on June 3) → currently around $17, essentially flat.
This is the weakest performer among the five targets, and the only position Hoffman has neither publicly added to nor expressed regret over.
Let's do a rough portfolio return estimate: Assuming 50% of capital is equally weighted across VVV, NEAR, ZEC, and HYPE (12.5% each), with the remaining 50% allocated to LIT, based on median estimates, the overall portfolio return lands around 90%-120%. Over the same period, ETH gained roughly 17%.
Hoffman's portfolio outperformed ETH by at least 70 percentage points.
Where did the wins come from?
Looking closely at this report card, what deserves the most attention isn't how much any single asset gained, but how Hoffman's selection logic was repeatedly validated by the market over three and a half months.
ZEC's surge was foreseeable. Grayscale's ETF application had been moving through the SEC process since November last year, and the August 25 official listing simply converted a long-brewing institutional catalyst into price. When Hoffman bought in May, ZEC had already climbed from the low $30s at the start of the year to over $500. His decision to enter during the window of "already up a lot but ETF not yet landed" was essentially a bet that the certainty of the catalyst outweighed the short-term risk of the price.
LIT's logic deserves deeper unpacking. While everyone was talking about how HYPE was becoming the on-chain Chicago Mercantile Exchange, Hoffman chose an earlier-stage, smaller-market-cap competitor with potentially more aggressive product architecture. His framework was "finding higher-beta exposure on the same track," layered with structural reasons like "faster buybacks, transparency premium from zk verification, and user migration potential from lower fees." In hindsight, LIT is up roughly 500% from its bottom, validating this approach.
NEAR's 69% gain ranks fourth in the portfolio, which doesn't look flashy. But given NEAR Intents' current role as a "toll booth" in the ZEC rally (ZEC-related trading pairs account for nearly 40% of NEAR Intents' total volume), Hoffman may have unintentionally built a self-reinforcing portfolio: the more ZEC rises, the more trading flow passes through Zashi wallet and NEAR Intents, the higher the fee revenue for NEAR Intents, and the stronger the buyback pressure on NEAR. There's an implicit positive feedback loop between the two assets he bought.
VVV is the only position that hasn't paid off. Venice AI's narrative as a decentralized AI inference platform briefly surged in early June but lost its sustained catalyst since, and Hoffman hasn't publicly doubled down either.
The Real Question
Hoffman's report card offers a signal more worth examining than "who went up by how much": the center of gravity in crypto market value is shifting from L1 valuations to application-layer revenue.
The ETH he dumped is an L1 asset, whose valuation logic is built on network effects, developer ecosystem, and the gas burn mechanism. Among the five assets he bought, HYPE and LIT are anchored to verifiable protocol revenue and buybacks, ZEC is anchored to institutional demand (ETFs) and on-chain observable privacy usage data (shielded supply ratio), NEAR is anchored to transaction volume and fees on the cross-chain settlement layer, and VVV is anchored to actual call volume for AI inference services.
The common thread across these five assets: their valuations derive from independently verifiable on-chain activity data, not narrative promises about the future.
Hoffman's sale of ETH has nothing to do with whether Ethereum's technology is good or bad—he himself said "I still believe Ethereum will win." He just realized something earlier than most: in a market with scarce liquidity, conviction doesn't generate returns—only verifiable cash flows and quantifiable demand do.
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