Arthur Hayes warns of Monad’s 99% drop, calls it a ‘high FDV, low-float VC coin’
Hayes says Monad's tokenomics is its ultimate weakness.
Monad has been one of the latest sensations in the industry, with its Coinbase initial coin offering (ICO) raising $269 million in record time.
However, speculation around Monad’s [MON] sustainability has intensified among market participants. This concern has already reflected in its short-term performance, with the token declining by 24%.
Hayes: MON will go to zero
Arthur Hayes, co-founder of BitMEX and Chief Investment Officer at Maelstrom, stated in a recent Altcoin Daily interview that nearly every Layer 1 token will trend toward zero over time, except Bitcoin [BTC], Solana [SOL], and Ethereum [ETH].
He specifically noted that Monad’s recent ICO success does not guarantee strong long-term performance, stating that the network could become “another bearish chain.”
Speaking about the token, Hayes added that MON could fall by as much as 99%, describing it as “another high FDV, low-float VC coin.”
He implied that insiders overvalue and tightly control the token, and will likely dump it once the locked tokens are released.
According to Hayes, the initial pump most tokens experience does not translate into long-term sustainability.
He added that many projects are simply attempting to recreate the missed opportunity of Ethereum in 2014. His bearish stance comes after a 25th of November announcement that he would close his position.
Strong tech, weak tokenomics
In response, Monad co-founder Keone Hon pushed back against Hayes’ claims, stating that Monad has launched some of the most innovative technology currently available in the market.
Hayes doubled down on his stance, arguing that the issue has nothing to do with technology, but rather weak tokenomics. He stated clearly that he does not care about the tech.
He said,
“Tell the community how you will maintain this price level with ~1% monthly inflation driven by staking rewards.”
Hayes added that real usage will drive MON’s value, especially as token unlocks occur more frequently over time.
Hayes also called on Monad to unlock all of its tokens and allow the market to move into a true price discovery phase in order to determine the asset’s real value under bullish conditions.
However, members of the crypto community pointed out that Maelstrom holds projects with locked tokens in its own portfolio, suggesting that Hayes may be taking a biased position.
Whales face the heat
Whales are now facing significant pressure as MON continues to decline, falling below its launch price of $0.0288, according to the Coinbase chart.
This drop has triggered a wave of liquidations. Two whales, who were previously in profit, reportedly lost a combined $3.23 million in the past 24 hours on Hyperliquid.
Because whales control a significant portion of market liquidity, their losses suggest that bearish sentiment remains strong and could push the asset even lower, with retail investors likely to suffer the most.
Final Thoughts
- Arthur Hayes has warned that all Layer 1 tokens, including Monad, will eventually trend to zero, predicting a 99% drop for MON.
- Liquidations are currently intensifying, with bullish investors facing the brunt of the impact.
