Organized & Compiled by: Deep Tide TechFlow

Guest: Mike Dudas, Partner at 6MV

Host: Laura Shin

Podcast Source: Unchained

Original Title: Hyperliquid Is About to Face More Competition. Here's Why Mike Dudas Isn't Worried

Air Date: June 5, 2026

Key Points Summary

In this episode, Mike Dudas, Partner at 6MV, discussed the recent volatility in the crypto market, as well as the narrative differentiation among core assets like Strategy, Ethereum, Solana, and Hyperliquid. He believes that Strategy selling Bitcoin has undermined the "never sell" belief premium cultivated by Michael Saylor for a long time; Ethereum's biggest issue is its inability to form a unified, market-priceable asset narrative, which is why both he and 6MV have zero allocation to ETH. In contrast, Mike is more optimistic about protocols with clear value capture mechanisms, programmatic buybacks, and continuous revenue, especially comparing Hyperliquid to Tether in the DeFi world: thriving in a massive network without relying on the U.S. market and growing in non-KYC, international trading demands.

Highlights of Insight

The Collapse of Strategy and Bitcoin Belief Premium

• "Strategy is trying to do two things simultaneously: on one hand, finance Bitcoin exposure, and on the other hand, shape it into a meme asset with a religious feel. The problem is that these two things are not entirely compatible."
• "Saylor's long-term promise to the market has been: I will never sell this asset. I just believe in it. So whether it's a few hundred Bitcoin or tens of thousands of Bitcoin being sold, once he starts selling, a pillar of the Strategy story is pulled out."
• "You need the market to fully believe that he will always buy this asset. So when the price drops, they must find a way to continue buying Bitcoin."

ETH Narrative Confusion and Zero Allocation

• "ETH has ended up being what many people want it to be, but the Foundation and many core writers are not truly willing to embrace the narrative of ETH as a currency asset."
• "If you look at the 100 major stakeholders in the Ethereum ecosystem, everyone is telling a different story: what this asset is, what the long-term mission of the network is, so the market naturally doesn't know how to value it."
• "As a fund, we do not hold ETH, and I personally do not hold ETH. Because I cannot tell you what its story is today, and I cannot tell you what it will become in three years."

Opportunities and Shortcomings of Solana

• "Solana's problem is clearer: it’s not a confusion of narrative, but a performance issue. On-chain activity and fees peaked in early 2025 and have continued to decline, with the price following suit."
• "Solana's previous activity mainly came from meme coins and highly speculative on-chain trading, but there is not enough sustained economic activity to fill the gap left by the decline in meme coin trading."
• "If Solana can truly break out in new directions like perpetual contracts and prove that L1 performance approaches centralized exchange levels, it may become an undervalued asset at some point."

Hyperliquid and the Non-KYC Market

• "My basic analogy for Hyperliquid is Tether for Circle. The non-KYC or international market in crypto is very large, and can fully support a massive network."
• "The key issue for Hyperliquid is not whether it can enter the U.S., but whether it can continuously list higher quality assets and maintain good enough liquidity."
• "Its real growth comes from asset quality and liquidity: crude oil, computing power markets, Pre-IPO stocks, predictive markets—these could all become new asset classes for on-chain trading."

Token Value Capture

• "In the crypto world, the best value capture mechanism is programmatic. Because this industry implicitly does not trust project parties, any mechanism relying on discretion will be discounted by the market."
• "Leadership must consistently and professionally articulate the product roadmap, telling investors, stakers, and ecosystem developers: this is not just serving the team, but a collective mission we are building together."
• "100% buybacks are not always optimal. The protocol needs to make the market believe that it is both rewarding token holders and continuing to invest in future growth."

AI Agents, Trading, and Payments

• "If the trading volume, frequency, and number of strategies of these agents exceed those of humans, that’s obviously good for fees. I believe that in the future, these L1s will mainly be valued in this way."
• "The real opportunities to capture value may not be purely transactional venues, but fronts that can reach end users, provide research, strategies, liquidity optimization, and better trading experiences."
• "Agent payments may not be a huge opportunity for new entrants, as giants like Visa, Mastercard, and Stripe are already acting quickly, with established customer bases, trust, risk control, and compliance capabilities."

Strategy Breaks the "Never Sell" Promise, Why Market Premium Disappears

Host Laura Shin: Mike, welcome to Unchained. This week, the crypto market has indeed been a bit brutal, with Bitcoin falling about 12% over the past week, 22% in the past month, and 27% year-to-date.

This week, the news that seems to have really impacted prices is that MSTR sold 32 Bitcoin, which was actually only about $2.5 million, but the market seems to have lost some confidence because of that. We've seen Bitcoin's price drop nearly $10,000 in just a few days, and the market has begun discussing various tools in MSTR's capital structure. What do you think about everything happening now?

Mike Dudas:

Saylor and Strategy are actually trying to do two things at once. The first thing, which you just mentioned and Jeff also talked about, is to financialize Bitcoin exposure. This is also the part that analysts discuss most often, whether looking at what Strategy has done this week or what it has done this year.

But another thing is somewhat different from Bitcoin financialization: turning it into a meme asset. Saylor regularly posts various memes and tells the market in a nearly religious manner: believe me, this is a messianic asset, a chosen asset.

The problem is that these two things are not entirely compatible. If you try to hold both of these logics in mind simultaneously, it creates a clear sense of dislocation. That almost faith-like commitment has always been: I will never sell this asset, I just believe in it. So whether selling a few hundred Bitcoin or tens of thousands of Bitcoin, once he starts selling, a pillar of the Strategy story is taken away. The market's reaction to the break of the "never sell" promise is very negative.

What comes next will be very crucial. Will they continue to sell? If they keep selling, it can alleviate some of the market's concerns about Strategy and STRC for the next few years, but that in itself will be a negative signal. Are they already doing this? The market may not be sure.

I feel that the religious enthusiasm and belief in the Strategy story have been punctured, and I do not know how this can be put back in the bottle; the market clearly does not like it.

Host Laura Shin: If Bitcoin’s price continues to trade sideways, or even further declines, what do you think MSTR should do to continue paying dividends on its preferred stock? Do you have any thoughts?

Mike Dudas:

This question isn’t simple. Many people will disagree with my viewpoint because they hold different assets issued by MicroStrategy, and their reasons may differ as well. But from my perspective, this is very clear: you need the market to completely believe he will always buy this asset. So when the price drops, they must find a way to continue buying Bitcoin.

I think many observers have actually anticipated that this day would come sooner or later. It just arrived sooner than everyone expected, because they started leveraging and had to pay so much cash flow; now it’s time to repay.

Why ETH Narratives Can't Be Unified, and Why Dudas Has Zero Allocation

Host Laura Shin: Let's talk about Ethereum. It is also at some kind of moment of re-evaluation. The latest round of discussions was sparked by some senior members of the Ethereum Foundation leaving. After that, Vitalik tried to respond to criticism, stating that the Foundation would scale down and he believes it will turn into one of many nodes.

We've also seen some long-term believers, such as David Hoffman from Bankless, at least lose confidence in the ETH asset. Are you bullish or bearish on ETH or Ethereum right now? What do you think is happening in the whole ecosystem?

Mike Dudas:

David from Bankless wrote an excellent article discussing the ETH asset. ETH has ultimately become what many people hoped it would be; it indeed has some monetary properties. But for some reason, the Foundation and much of the writing surrounding Ethereum do not genuinely want to embrace this narrative.

They are more telling a story of a "trusted neutral layer," saying it has a duration of decades to build towards. But if you look at the 100 major stakeholders within the Ethereum ecosystem, everyone is telling a different story: what this asset actually is? What is the long-term mission of this network?

So the answer is pretty clear. Over the past five years, the market has no idea how to price the future of ETH. Therefore, ETH is not an asset held by our fund, and I personally do not hold it. We have zero allocation because I cannot tell you what its story is today, nor can I tell you what it will be in three years.

I also do not know which side will ultimately win out in this tug-of-war between those who want to embrace ETH as a currency asset, appeal to institutions, and protect trillions in value, versus those who want Ethereum to become some sort of utopian world computer.

Host Laura Shin: If Ethereum wants you 6MV to feel it should hold ETH, what changes would it need to make in tokenomics or certain aspects of the overall architecture?

Mike Dudas:

We now see financialized assets like HYPE, which seem easier for the market to understand. It has a very clear, singular story, and the market knows what it is buying.

If an asset wants to gain enough stakeholders for the long term, as well as sustain funding and have confidence in holding it, it must have a clean, singular narrative. Ethereum has not achieved this in the past few years, and frankly, many other general-purpose smart contract L1s have not either.

Host Laura Shin: The most common comparison to Ethereum is Solana. It has obviously faced difficulties this year. I know you are relatively more optimistic about Solana. Solana is also discussing a change in its token economics. What do you think about why it has fallen and where it might be headed?

Mike Dudas:

The reasons for Solana's poor performance are clearer. I think the Solana Foundation and key stakeholders are doing a better job than the Ethereum ecosystem in searching for a North Star. They are more explicitly focused on REV, which is real economic value, namely the fees accumulated for token holders and stakers. Solana's main problem is performance. On-chain activity and fees peaked around early 2025 and have been on a downward trend ever since, leading to a drop in Solana's price.

Previous activity was primarily driven by meme coins and other highly speculative on-chain activities. There are many different trends within that, a large influx of price-insensitive capital, and many retail investors willing to pay high fees. But now, there isn't enough sustained economic activity to fill the gap left by the decline in meme coin trading volume.

I still think there's a significant opportunity for new activity to emerge in the future. Solana is embracing many different narratives, and it may have more opportunities than other ecosystems as it works to address its past weaknesses. Perpetual contracts are a typical example, with the Foundation and other key participants talking about it.

But today, the market hasn't seen enough evidence to prove that the teams on Solana can genuinely execute in these directions, and it hasn't proven that Solana's L1 performance is sufficient to support these levels close to those of centralized exchanges. If all this occurs, it may become an undervalued asset at some point. But for now, we need to see those promised activities begin to emerge and materialize.

Hyperliquid: More Like Tether in DeFi than Another L1

Host Laura Shin: Next, let’s talk about another L1 that has nearly captured all the attention this year, HYPE. It is essentially one of the few crypto assets that have risen this year. But we have also seen some news over the past week indicating that it will face fierce competition. Perpetual contracts are entering the U.S. compliant market, with related news from Kalshi and Coinbase.

How do you think Hyperliquid should respond to this moment? It has to face new competition while maintaining a non-KYC model; do you think it can continue to maintain its dominance?

Mike Dudas:

The non-KYC market is massive. So if you ask whether it can continue to grow, the answer is clearly yes, in my opinion. As for the term "dominant," I’m not sure.

You can look at Binance. It has been the largest exchange in the world to date but has never built a truly scaled business in the U.S. A platform can indeed become very, very large even while operating outside the U.S.

If Hyperliquid can find a way to enter the U.S. in some KYC manner in the future, that could be potential upside not yet priced in. But today, those driving capital towards HYPE are not assuming that U.S. users will be trading 50x leveraged perpetual contracts on Hyperliquid next year.

Host Laura Shin: Do you think it can manage the competition? Or do you think they are fundamentally different markets?

Mike Dudas:

My basic analogy is Tether to Circle, where Tether can be incredibly large. Tron as an L1 is very valuable, even more valuable than many louder L1s.

In the crypto field, the non-KYC or international market is already very large. So for me, the bigger question is whether Hyperliquid can continually add higher quality assets to the platform. Most of its growth over the last six to nine months has come from this.

Can it bring online the next crude oil market? Can it become the main venue for the largest computing power market? Can it add more Pre-IPO stocks? These assets have recently begun to take off.

So for me, the core issue for HYPE is asset quality and liquidity. So far, they have been continuously outperforming in this regard. Now they are also entering area markets, stepping into predictive market-like domains. So they are expanding their market. Next, we will see if they can attract more people to build on it, develop market-facing interfaces, and ensure that the costs of attracting more liquidity and users do not increase exponentially.

How ETH, SOL, and HYPE Compete

Host Laura Shin: We have talked about ETH, SOL, and HYPE separately. I want to hear your thoughts on whether they compete with each other. If so, how do you think this competition will unfold?

Mike Dudas:

They do indeed compete with each other. They compete for liquidity, asset issuance, and trading volume. There is no doubt about that.

However, Solana and Ethereum are more similar to each other, while Ethereum and Hyperliquid or Solana and Hyperliquid are less so. It’s a strange type of competition. Both Solana and Ethereum aim to be general-purpose blockchains, with use cases far exceeding those of Hyperliquid. Hyperliquid is more focused on being the main venue for all financial activities.

On Solana and Ethereum, there are stablecoin issuances, payments, and various so-called Web3 types of things. Thus, their valuations largely derive from activities happening on their ecosystems. Hyperliquid is different; it is more like a full-stack protocol, with most of the trading volume passing through its own frontend, and the entire ecosystem's value is more captured within the protocol.

So this is complex. I believe if Solana and Ethereum focus less on the competition with Hyperliquid, and instead emphasize their own strengths and why developers should build on their L1s, they'd stand to benefit more, since they ultimately rely on developer activity.

Frankly, they're not just competing on the developer level. Marginally, both Solana and Ethereum need the next great application to be born on their platforms. And the range of these potential applications, I think, is much broader than that of Hyperliquid.

Hyperliquid is undoubtedly competing with them, but it is not competition in the traditional business strategic sense. It seems more like a very small, highly focused team; they claim their team has fewer than 20 people. They have their roadmap and do not reveal too much prematurely but continue to execute like a company.

So it's hard to draw simple conclusions. They are mainly competing for liquidity, mindshare, where developers will build, and market attention; Solana and Ethereum compete with each other more directly. However, you will also increasingly find that this competition is not entirely positive. For example, BlackRock may simultaneously issue new tokenized funds on both Solana and Ethereum. In the end, on the issues of end users, consumers, and who can bring liquidity, they begin to become substitutes for each other. That’s what everyone is truly competing for.

Host Laura Shin: Ethereum is a bit like IBM; choosing to deploy a project on Ethereum almost does not raise concerns about accountability. But it also faces many technical challenges, such as block time, one of the most fundamental problems, and the state of development of the entire L2 solutions. All of this raises the question: What direction will Ethereum ultimately take?

Solana may have some technical advantages, but it doesn't have the lengthy track record Ethereum does. Ethereum's 100% uptime metric is nearly unbeatable. It is currently difficult to judge who will truly win the race.

Mike Dudas:

I want to add one last point about Ethereum. Many things considered advantages for Ethereum, like TVL, are largely residual advantages. That is, capital that earned money early on Ethereum and stuck around.

Of course, many people are also making money today on Hyperliquid because of airdrops, increasing positions, and providing liquidity. But if you look at the net new growth rate over the past three to four years, Solana's speed of change is undoubtedly faster than Ethereum's.

Why Programmatic Buybacks Are Better Than Discretionary Buybacks

Host Laura Shin: We are now in a phase where the practical applications of blockchain technology are becoming gradually mainstream, and many tokens in the market are being weeded out. I know you are generally more optimistic about tokens with value capture mechanisms. Among these tokens, there are different value capture models. Which mechanisms do you prefer? Or which tokens do you think have successfully built and operated such value capture structures?

Mike Dudas:

I think there are two crucial points.

First, crypto assets are generally viewed as protocols, so the value capture mechanism should ideally be programmatic; this is very important. For example, Hyperliquid's value capture mechanism allocates 97% of fees to buy back tokens, which could theoretically lead to long-term token burn. Programmatic is important.

Second, communication must be consistent. This isn't just an issue about the token mechanism but also includes how you tell your story to the public. You need to consistently and professionally articulate your product roadmap, informing investors, stakers, and those building around you: you value them; this is not just about the team, but a greater mission that we are doing together.

So I appreciate those tokens whose leadership can convey a consistent story. These are the two points I value the most.

Many will disagree with me, they will say that token buybacks should be at the discretion of the project parties. But that confuses the market. We have seen some projects take discretionary buybacks, then stop doing buybacks or change plans. I don’t want to name specific projects.

This is an industry that defaults to not trusting builders. Historically, the rates of fraud, abuse, arbitrage, and opacity in the crypto industry are higher than in traditional business markets. So as long as there is discretion in the mechanism, the market will assign it a lower valuation; mechanisms without discretion will receive higher valuations.

On value capture, I want to add one final point: there must be a balance. If you do 100% buybacks, you must also make people believe you are indeed investing in future business growth.

So they later modified their buyback mechanism from discretionary to programmatic for the next year, setting the buyback ratio at half of the protocol's revenue. This conveys a credible signal: they are both buying back and will continue to invest in the protocol and in new products like Pump Go.

You want to see that the protocol will continue to reinvest in the future. Because if you only rely on the protocol and the foundation's discretion to sell tokens, the problems can become quite messy. We have seen similar situations on Ethereum: to raise funds for operations, the foundation continued to sell tokens on the secondary market at discounted rates. You start to wonder, where does the funding really come from?

I think Cardano has similar issues. Charles is wealthy, and many people in this ecosystem have accumulated wealth, but it seems there is a lack of investment today. So for tokens whose only source of funds is pre-mined and allocated to the operation of the protocol, I find it hard to accept. Because that leads to strange incentive issues and funding inadequacy.

Host Laura Shin: Let's talk about the real-world perpetual contracts segment, which has been very interesting this year. It started with the crude oil perpetual contracts on Hyperliquid traded over the weekend in relation to events concerning the Iran war. Recently, we saw Pre-IPO stocks pricing discovery on Hyperliquid.

In my view, these are all glimmers of a greater trend. Where do you think this will lead?

Mike Dudas:

One major thing we clearly need to do is bring interesting assets into the crypto market. By bringing these assets on-chain, we can enable them to trade 24/7 year-round while significantly reducing trading costs. Of course, supporting a non-KYC (no identity verification) model is also a key aspect. People can trade in a decentralized manner without having to rely on centralized counterparties, which is critical, regardless of their reasons for choosing to do so.

At the end of the day, the more high-quality assets we bring on-chain, the more the entire industry will benefit. We now have enough evidence that people are willing to trade these assets around the clock and are willing to do so through self-custody wallets.

Every ecosystem is watching this. I know the Solana Foundation is very focused on it, Hyperliquid is watching it, and teams like TradeXYZ are also working hard to push new asset issuances, supported by more robust oracle and pricing mechanisms to help more people trust these markets.

Even though we have already seen the trading volume and transaction amounts in these markets today, they have not yet become mainstream institutional trading platforms. If one day these markets truly become a primary choice for institutional investors, then the scale and impact of the entire industry will become very significant.

AI Agent Trading Has a Future, but Agent Payments Face Visa and Mastercard

Host Laura Shin: We can also see that crypto and AI will become a huge theme. In my view, agents will eventually conduct more trades than humans. But where do you think the value in these activities will accumulate? Is it at the protocol layer, platform layer, or elsewhere?

Mike Dudas:

That's a good question. In terms of trends, exchanges will benefit. If L1s like Solana can bring more activity and users are less sensitive to price during these activities and willing to pay fees, then the L1 will benefit. As long as you can generate more trading volume, you will incur more fees. Hyperliquid's value capture model is very direct, and Solana will also benefit from fees.

If the trading volume, trading frequency, and number of strategies of these agents exceed those of humans, that's obviously great for fees. I believe these L1s will mainly be valued in this way in the future.

Looking a layer up to the application layer, it's not yet clear whether exchanges can create differentiated value capture. Previous DEXs and similar products have not always managed to capture a large percentage of value, so we are still observing if there can be significant value generated there.

But one thing is already quite clear: the frontend can capture value. If you can present data effectively, during the meme coin era, some frontends could charge fees as high as 1% or even more per transaction—this is a direction worth exploring.

Future forms of the frontend will also change. In the trading field, I envision products similar to AI research labs that specifically serve financial markets, assisting individuals and institutions in creating very complex, performance-based trades. They can help humans execute strategies today that only top algorithmic traders can perform. If you can accomplish that, it becomes an interface layer built on models and can charge me for outperforming the market.

So we will focus on who truly reaches end users, institutions, or consumers, and whether it provides value beyond just being a transactional venue. Can it help me generate ideas? Can it help me achieve better liquidity or narrower spreads? That's the key.

I am more focused on agents and trading because I'm not sure agent payments will be a particularly good business. We often hear about agent finance, especially agent payments, but existing giants like Visa, Mastercard, and Stripe are entering this field very quickly and aggressively. New entrants find it hard to surpass the established customer bases, trust, fraud prevention capabilities, compliance capabilities, and risk control algorithms that they have installed. Therefore, on the payment side and the non-trading and non-speculative side, the challenges will be very significant.

Host Laura Shin: At this moment when crypto starts to become real and is being adopted by ordinary people, how has it changed crypto VC? And how has it changed your own investment thinking?

Mike Dudas:

Recently, several things have changed in crypto VC, and the entire VC industry is undergoing similar changes.

First, the cost of launching a project has decreased. Now you can create an MVP with fewer people because you can virtually tap into the capabilities of developers around the world using tools like Claude, Codex, or others. Even some who are not very technical can quickly bring their ideas to life.

This will lead to two possibilities: either the pre-seed stage will shrink, or the number of pre-seed projects will increase significantly. In other words, there will be more early projects, but it will be harder for VCs to filter out the signals from the noise.

So as early-stage investors, you will now be looking for traction earlier, looking for proof that: can this person create something with users? Is there a bit of natural economic activity appearing on it?

At the same time, the ability to scale to massive sizes has also increased. Crypto has always exhibited this power law feature. Pump.fun grew very rapidly, and during the last cycle, OpenSea also grew very rapidly. The main struggle for crypto has been whether these things can sustain for the long term.

The application layer has gone through several cycles; I think we are now in about the third application layer cycle. But very few enterprises can truly stand long across multiple cycles; most are in DeFi, specifically those DeFi leaders.

So for crypto VC, you are actually looking for sustainable behavior, and you will find that these behaviors often resemble things that already exist in the real world, but operate better because of blockchain. For example, trading around the clock, cheaper liquidity formations, and capital participation from anywhere. Of course, non-KYC and universal accessibility are also important properties of many projects.

We are now in a period of immense change. Most global venture capital and private equity funds are flowing into AI-native companies. Not just crypto; any field that doesn't belong purely to AI is somewhat short on capital and talent.

You will see many of the smartest individuals moving towards AI. Interestingly, many of the smartest crypto practitioners are also starting to do things outside of crypto successfully. They got into crypto early, succeeded hugely, had strong foresight, accumulated wealth, developed excellent products, and are now entering adjacent industries.

VCs are similar. Many of the deals that Paradigm recently made public appear to be in fields adjacent to but outside of crypto. Many VCs are entering directions like power, energy, computing power, etc.

You will see many people expanding their horizons while retaining their crypto roots and advantages. This trend will continue because the opportunities are massive. Crypto VCs and builders have been at the forefront for the past 15 years, watching new market structures form and helping create one of the fastest-growing new asset classes. These individuals themselves are innovators, and now they are bringing that capability to a broader landscape.