Arthur Hayes, co-founder of BitMEX, believes that most layer-1 blockchain networks will struggle, suggesting that only Ethereum and Solana are likely to have the institutional applications needed for lasting viability.
In a discussion on the Altcoin Daily podcast on November 28, Hayes reiterated his stance as more alternative base layer blockchains emerge. He anticipates the market will converge around a few key networks.
Why Hayes thinks Ethereum and Solana will survive
Hayes emphasized that Ethereum’s importance to institutional adoption is pivotal for its longevity. He believes that investors will leverage Ethereum for their Web3 ambitions and expects a select group of major public L1s to remain significant for several years.
“Ethereum, this whole ecosystem, is going to be used by TradFi to do whatever they want to do within Web3… Ethereum is clearly winning and will continue to win,” he stated.
He pointed out that Solana is the only other platform with comparable endurance. Though he acknowledged Solana’s recent resurgence, he mentioned that its next growth catalyst isn’t clearly defined. The hype around memecoins on Solana has faded, and now the network must discover “new tricks” to spur growth.
“Solana needs a new trick. I don’t know what that new trick is, but again, this is No. 2 L1. I think they’ll find something,” Hayes remarked.
Even with this optimism, Hayes expressed doubt that Solana would surpass Ethereum over the long haul, stating, “nearly all L1s other than Ethereum and Solana are zero.”
Ethereum and Solana are currently the top two Layer 1 networks by market capitalization, drawing institutional interest from firms like Franklin Templeton.
A bearish view on the Monad
Conversely, Hayes is more doubtful about Monad, which introduced its MON token and public blockchain this week. This project is marketed as a high-performance layer 1 with capabilities compatible with the Ethereum virtual machine. Some industry figures have dubbed it “the next ETH killer.”
Hayes dismissed this label, asserting that “nearly all L1s other than Ethereum and Solana are zero and won’t work very well.” He labeled Monad as “another bear chain” and predicted that its token “will drop 99% as it is also part of a high FTV, low float VC lint.”
While he admitted to having purchased some MON tokens, he contended that the initial price fluctuations don’t necessarily indicate lasting value.
“Every coin receives its first pump and people want to believe in the new L1 because everyone wants to invest in the new Ethereum, like in 2014 when everyone missed it, including me. But again, that doesn’t mean there’s actually a real-world use case,” Hayes emphasized.
In light of this, Hayes noted that his broader market outlook continues to focus on Bitcoin, Ethereum, and Solana, with ZCash and Etena potentially rounding out his preferred five.
