Arthur Hayes, co-founder of crypto derivatives exchange BitMEX, has warned that most Layer 1 blockchain tokens outside Ethereum and Solana are unlikely to survive long-term. In an interview with Altcoin Daily, he argued that many newly launched networks, despite attracting early investor attention, lack sustainable fundamentals and carry inflated valuations. Hayes emphasized that initial hype often creates short-term price gains but does not guarantee enduring success for these projects. Monad and the Risks of High-Valuation L1s Hayes specifically highlighted Monad, a recently launched L1 backed by Coinbase Ventures. At the time of his statement, MON token had risen 45% since its ICO, reaching roughly $0.037 with a market capitalization near $398 million. Despite these gains, Hayes expects a dramatic decline, citing the coin’s high fully diluted valuation and low circulating supply. He noted that many new L1s follow a pattern of early surges followed by sharp corrections, driven by initial investor optimism rather than fundamental value. According to Hayes, new L1 projects often attract attention because investors hope to discover the next Ethereum. Early pumps create excitement, but most tokens fail to maintain momentum once hype fades. Venture capital support may temporarily prop up prices, but Hayes warned that this does not guarantee long-term success. Consequently, he believes most L1 tokens outside Ethereum and Solana are destined for collapse. Ethereum and Solana: The Standout Networks Despite the challenges facing newer L1s, Hayes identifies Ethereum and Solana as exceptions. He sees Ethereum as the foundation for institutional blockchain adoption. Large banks and organizations now prefer public networks over private chains due to security and utility advantages. Layer 2 solutions like Arbitrum and Optimism will help Ethereum scale while maintaining privacy, positioning it for sustained growth. Solana, according to Hayes, remains the second-largest L1, benefiting previously from meme coin activity. However, he acknowledges that meme-driven growth has slowed. Solana will need a new catalyst to maintain user engagement and price momentum. While Hayes remains skeptical that it will surpass Ethereum, he believes the network will continue to play a significant role in the blockchain ecosystem. Hayes’ Magnificent Five In addition to Ethereum and Solana, Hayes named Bitcoin, Zcash, and Ethena as his top cryptocurrency picks. These networks combine adoption, security, and practical utility, which he considers critical for long-term success. By contrast, most other L1 tokens face a high risk of decline as early enthusiasm fades.
