Arthur Hayes is warning investors that Monad could lose most of its value as he stresses that only a few major chains will endure.
Arthur Hayes continues to share direct views about new blockchain projects and his recent comments on Monad have caused debate across the crypto sector.
His remarks have now raised questions about how new chains enter the market, how they win trust and why many fail once early interest fades.
Arthur Hayes did not hold back during his appearance on Altcoin Daily. He said Monad carries significant downside risk due to its token structure and early-stage growth.
He described it as a high FDV, low float project, which often places retail traders at a disadvantage. For context, FDV is the value a project would show if every token were already trading on the market.
When the gap between FDV and circulating supply becomes wide, prices can move sharply once insider tokens unlock.
Hayes said that many traders chase early gains on new chains, then face sudden drops when liquidity starts thinning. He warned that Monad fits this pattern and expects its token to lose most of its value once the first wave of excitement quiets down.
The new chain launched this week and released its MON token through an airdrop.
Monad also raised $225 million from Paradigm last year, and the project markets itself as a high-performance solution that supports parallelised execution. It also does this while staying compatible with the Ethereum Virtual Machine.
Supporters believe that this mix gives it an advantage, but Hayes disagrees.
Hayes said the list of new layer-1 projects grows every year but most will not last. He expects the market to narrow around a small group that can attract developers, users and institutional adoption.
So far, his shortlist includes Bitcoin, Ethereum, Solana and Zcash. He said these have staying power because they hold strong communities, deeper liquidity and clearer use cases.
He pointed to many past cycles where dozens of new chains arrived with strong marketing but could not keep traction. He believes the same pattern will repeat, and added that every new chain gets an early push because traders search for the next major breakout.
All before the hype fades.
Related Reading: Hayes Predicts Equity Perps Will Overtake Stock Exchanges
Hayes often points out Ethereum as the most important chain for institutional partners.
He said large investors use Ethereum for stablecoins, tokenised assets and various Web3 experiments and affirmed that this activity will continue growing.
According to him, this gives Ethereum more strength than projects trying to enter the same space with smaller teams and fewer connections.
He also believes that Solana will remain a major chain. Solana recently recovered strongly after its earlier struggles and regained attention from traders and builders. Hayes said that Solana needs a fresh growth driver after the meme coin rush cooled down.
He expects the chain to find new uses but does not expect it to outperform Ethereum over long periods.
He argued that almost every other layer-1 project will fade because they lack the same level of adoption or liquidity. In all, he sees Ethereum and Solana as the only two that can attract serious long-term activity outside Bitcoin.
Read more on Live Bitcoin News
