The crypto market has finally shown signs of a bottom. Since July 1st, Bitcoin has risen by 9%, while the Nasdaq 100 index has fallen by 6% over the same period. Inflows into crypto ETFs have turned positive, and market sentiment continues to improve. Although it is still too early to determine if the market has completely stabilized, various positive signals have prompted many to start questioning the direction of the next trend.
Last Friday, an investment advisor asked me, "If the market has already bottomed out, what assets will lead the next cryptocurrency bull market?"
Typically, during the crypto winter, this question is difficult to answer. The main theme of a new bull market often only becomes clear after the trend has fully played out.
However, this time, I believe the answer is already evident: the core narrative of the next cryptocurrency bull market will be the integration of on-chain finance with traditional finance.
In other words, the key focus of the future market will revolve around stablecoins, asset tokenization, 24/7 trading, instant settlement, and the growth of institutional-grade decentralized finance (DeFi) to a multi-trillion-dollar scale. Blockchain will disrupt the existing financial system, much like the internet reshaped the media and retail industries at the beginning of the 21st century. I expect this to be potentially the largest crypto cycle in history, for two reasons: first, this cycle is based on real-world utility and revenue drivers, rather than purely market speculation; second, the market targeted in this cycle is much larger than in previous cycles — aiming at the global financial market rather than being limited to the crypto industry.
Some may find these trends obvious: asset tokenization will inevitably lead the next bull market, stablecoin market capitalization will eventually surpass trillions of dollars, and major Wall Street institutions will inevitably transition to on-chain. After all, crypto infrastructure offers many natural advantages compared to the traditional financial system: 24/7 trading is much more convenient than limited trading hours; instant settlement is superior to T+1 delivery; global connectivity transcends geographical restrictions. I am not the only one holding this view, as the Chairman of the U.S. Securities and Exchange Commission, the CEO of the world's largest asset management company, and the CEO of the world's largest bank all agree.
However, even though the trends seem clear, the vast majority of investors have not yet positioned their assets for this outlook. Many are still wondering if the crypto industry has already seen its heyday. Within this cognitive gap lies a significant investment opportunity.
So, how should we position ourselves for the next bull run? One approach is to focus on two key players that are driving industry convergence from different angles: Hyperliquid (token: HYPE) and Robinhood (stock ticker: HOOD).
From Within the Crypto Industry
Hyperliquid (HYPE) is a layer-one public chain (similar to Ethereum, Solana) that was initially designed to create a perpetual derivatives trading market primarily focused on crypto assets. Initially, investors speculated on Bitcoin, Ethereum, and other crypto assets through the Hyperliquid platform.
However, leveraging its excellent technical experience—such as easy operation, real-time settlement, and 24/7 trading—the platform quickly expanded its business outward. Today, nearly half of the trading volume on the Hyperliquid platform comes from traditional assets like oil, silver, and the S&P 500 index. The platform is also continuously expanding into commodities spot trading, prediction markets, options trading, and posing a competitive threat to a range of trading platforms such as CME, Nasdaq, ICE, Kalshi, and Coinbase.
Hyperliquid's rapid development has put pressure on its competitors. CME even sued the U.S. Commodity Futures Trading Commission (CFTC), attempting to obstruct the regulatory acceptance of perpetual futures products pioneered by Hyperliquid.
Even in the midst of the crypto winter, the HYPE token has still seen a 146% increase in price this year. The growth data is well supported: the Hyperliquid platform's cumulative total revenue surpassed $1 billion in June, and it is expected to reach $800 million in annual revenue. The platform will use 99% of its revenue to buy back the native token HYPE on the open market, continuously reducing the circulating supply. In my view, even if the price of HYPE doubles again, the valuation would still be within a reasonable range.
From Within Traditional Finance
Robinhood has chosen to stand on the side of traditional finance and drive this industry convergence.
Robinhood itself is a traditional securities broker, competing with institutions like Charles Schwab for retail and professional investors. Over the years, Robinhood's attitude towards crypto assets has been much more open than its peers, making it the first major brokerage to launch direct cryptocurrency trading.
At the same time, Robinhood fully embraces my proposal of "industry convergence." The company's CEO, Vlad Tenev, stated that asset tokenization "will ultimately reshape the entire financial system" and that the crypto industry and traditional finance "have long been two independent systems but will eventually fully merge." He predicts that the boundaries between the two will eventually disappear.
On July 1st, Robinhood doubled down on this trend by launching its proprietary Layer 2 blockchain, Robinhood Chain. This public chain is open to users in 120 countries (excluding the United States for now), allowing them to trade tokenized stocks 24/7 all year round. The chain also supports mainstream decentralized finance protocols: users can swap assets on Uniswap, collateralize assets for borrowing on Morpho, or stake assets as collateral for trading perpetual contracts on the Lighter platform. Within just two weeks of its launch, Robinhood Chain's assets under custody surpassed $3 billion, with a daily trading volume of 3.6 million transactions.
This passage is worth careful consideration: earlier this month, solely relying on technology, Robinhood rolled out a set of financial services in 120 countries, enabling users to seamlessly buy and sell tokenized stocks in real time, engage in margin trading and leverage, with a significant number of users already participating.
Skeptics may point out that early on-chain activity was largely concentrated in meme coins rather than stocks, which is indeed true. However, the trading volume of tokenized stocks has reached a substantial scale, with a real user base in place, and I expect both types of trading to continue growing.
One thing I am certain of is that Robinhood's major competitors are closely watching this project and beginning to consider: Should we also follow suit and make our own JPMorgan Chain, UBS Chain, or Bank of America Chain? The trading activity demonstrated in the early stages of Robinhood's launch is something no institution can ignore.
Two Investment Targets Poised to Stand Out
I believe the current bull market cycle is robust enough to drive most assets in the industry upwards. I am bullish in the long term on mainstream cryptocurrencies such as Bitcoin, Ethereum, Solana, and publicly listed companies in the crypto space.
However, there are two types of investment targets that will have particularly outstanding upside potential.
1. Hyperliquid Track: Native encrypted financial applications with real revenue and a high-quality tokenomics model
What sets Hyperliquid apart from other crypto applications is its core strengths of stable real income and a robust tokenomics model (99% of revenue used for HYPE buyback and burn). Many investors have seen numerous crypto applications with a large user base and transaction volume but a continuously low token price, and Hyperliquid's model aligns perfectly with the demands of these investors.
In the long run, I believe there will be a plethora of emerging crypto projects emulating HYPE's tokenomics model, giving rise to a new generation of token investment opportunities with potential. At the same time, I am also keeping an eye on mature projects that have established a business scale and actively bind token value with platform utility. For example, Uniswap and Aave, two prominent platforms with significant volume, are rapidly optimizing their tokenomics; Morpho is also evolving in the same direction.
2. Robinhood Track: Mature Traditional Enterprises Operating on Crypto Infrastructure
Industry disruption will reshape market share dynamics. The popularization of stablecoins, asset tokenization, and the implementation of blockchain transaction infrastructure represent the most significant technological transformation the financial markets have seen in the past fifty years, with profound changes quietly taking place.
To identify the winners, focus on enterprises that have already scaled their crypto businesses, rather than those still in the conceptual validation stage. Concept pilot projects may have low costs and attract media attention easily, but they struggle to accumulate practical experience. Leveraging the industry knowledge accumulated through operating on a public chain serving 120 countries, Robinhood is far ahead of any small-scale pilot projects.
The enterprises I continue to monitor include Coinbase, Figure, and BlackRock; at the same time, I keep an eye on Visa, Stripe, and even JPMorgan Chase. Of course, there are other participants, but the mentioned enterprises are all deeply engaged in this transformation.
Grasping the Industry Convergence Trend
For a long time, the crypto industry has had a consensus: the ultimate success of blockchain is marked by its technological "invisibility" — when blockchain is deeply integrated into the underlying architecture of the financial system, users may not even perceive the existence of blockchain when using services.
I firmly believe that when the next bull market arrives and traditional finance is inseparable from the crypto industry, this vision will become a reality. Investors should align with this trend and position themselves early.
Note: Sometimes, to assess a company's crypto strategy, one needs to look at its actual actions rather than its external rhetoric.
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