The Two Biggest Issues In Crypto Today | Weekly Roundup
Speakers
Summary
- Santi's Equity Strategy: After moving to cash in Q4 due to risk/reward, is now "nibbling" at long-term equity holdings down 30-50%, such as Google (viewed as a monopoly) and ServiceNow. Not buying tokens, only equities.
- Crypto VC Consolidation: The space is experiencing a "mass extinction event." Easy money era is over; hit rates are falling. Capital will consolidate into a few large funds and niche players, with many others dying out, mirroring traditional venture dynamics.
- Extreme Secondary Market Discounts: Santi observes average ~90% discounts for locked tokens of venture-backed projects relative to their last equity round price, citing a broad "hatred" or structural disillusionment with tokens as an investable asset class.
- DeFi Security & Yield Critique: The Drift exploit ($280M) highlights critical operational security failures (e.g., reduced multisig threshold). Santi argues DeFi yields are not high enough to compensate for smart contract and composability risk, preferring treasuries for capital preservation.
- Macro Overhang: Broader market direction remains heavily tied to macro uncertainties (e.g., Middle East conflict, inflation, rate cuts), making short-term trading difficult but creating long-term entry points for specific equities.
- Quantum Computing Timeline Accelerated: New Google/Caltech research suggests the threat to Bitcoin's cryptography (elliptic curve signatures) may be viable by ~2029, far sooner than previously thought, creating a urgent coordination problem for a Bitcoin upgrade.
- Bifurcation in Venture: Seed stage valuations are sensible for most, but extreme bifurcation exists with top 10% of deals (driven by AI/crypto crossovers, stablecoins, prediction markets) commanding median valuations of ~$125M, as capital piles into perceived winners.
- Active Management Value: In a noisy environment with AI-generated content, the edge of active, fundamental research (in both equity and crypto) is increasing in value relative to passive indexing.
Trade Ideas
Santi states he has a position in Google, finds it comfortable to own for multi-year periods because "it's a monopoly" and he doesn't think they will be unseated. He is accumulating names on his shopping list that are down significantly, focusing on long-term secular tailwinds. Google fits this thesis as a high-conviction, durable business. LONG. He is explicitly buying and holding Google as a core, long-term position based on its dominant market position and discounted price. Prolonged macro downturn impacting all equities; regulatory action against monopolies.
Santi names ServiceNow as a specific position he holds, citing a disconnect where some enterprise software/SaaS names are trading at compelling multiples. His background as an enterprise software analyst informs this view. He is accumulating equities he wants to hold long-term as they trade down. WATCH. He holds a position and finds the valuation compelling, but it is presented as part of a broader basket of opportunities rather than a standalone high-conviction call. Enterprise IT spending contraction in a recession; competition in the SaaS space.
Santi describes a "crypto VC mass extinction event," where too much capital chased a not-that-big space, hit rates are falling, and "only a few funds will survive." The causal chain is that the easy money era in crypto venture is over, returns are collapsing, and the industry must consolidate. This implies most venture funds (a subset of Finance) are unattractive and will fail. AVOID. The implication is that broad exposure to the crypto venture capital sector carries high risk of failure and capital impairment; capital should flow only to the proven top performers. A sudden new bull market in crypto could temporarily resurrect fundraising and returns, delaying consolidation.
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This Empire video, published April 03, 2026, features Santiago R. Santos discussing GOOG, NOW, XLF. 3 trade ideas extracted by AI with direction and confidence scoring.
Speakers: Santiago R. Santos · Tickers: GOOG, NOW, XLF