Monad, a recent sensation following its record-breaking initial coin offering, is now at the center of a heated debate regarding its long-term viability. Despite an impressive $269 million raise, the token's sustainability is being questioned by prominent industry figures, leading to a significant 24% decline in its short-term performance and igniting concerns across the market.
Arthur Hayes' Dire Forecast for Monad
Arthur Hayes, co-founder of BitMEX and Chief Investment Officer at Maelstrom, has issued a stark warning regarding the future of Monad's token, MON. Hayes contends that nearly all Layer 1 tokens, with the notable exceptions of Bitcoin, Solana, and Ethereum, are destined to trend towards zero over time. He specifically predicted a potential 99% drop for MON, labeling it "another high FDV, low-float VC coin" that insiders may overvalue and control, likely to be dumped once locked tokens are released. Hayes emphasized that initial token pumps do not guarantee long-term sustainability, seeing many projects as merely attempting to replicate Ethereum's early success.
The Tech vs. Tokenomics Debate
In response to Hayes' claims, Monad co-founder Keone Hon defended the project's innovative technology, asserting its strength in the market. However, Hayes doubled down on his stance, arguing that technological prowess is irrelevant without sound tokenomics. He directly challenged Monad to explain how it would maintain price levels with approximately 1% monthly inflation driven by staking rewards and advocated for an immediate unlocking of all tokens to allow for true price discovery under bullish conditions. Interestingly, crypto community members have pointed out that Maelstrom, Hayes' firm, also holds projects with locked tokens, raising questions about a potential bias in his position.
Market Fallout and Whale Woes
The intensifying skepticism and Hayes' predictions have had an immediate and tangible impact on Monad's market performance. MON has fallen below its launch price of $0.0288, triggering a wave of liquidations. Reportedly, two significant whales, who were previously in profit, experienced a combined loss of $3.23 million in a single 24-hour period on Hyperliquid. These substantial losses among major market players underscore the strong bearish sentiment now permeating the market, indicating that MON could face further downward pressure, with retail investors likely to bear the brunt of any continued decline.
