Arthur Hayes Warns Monad Could Face Sharp Downturn as Debate Grows Over High-FDV Tokens

Arthur Hayes’ Warning on Monad’s Valuation

Former BitMEX CEO Arthur Hayes has reignited debate in the crypto community by criticizing Monad Monad for its high fully diluted valuation (FDV). He suggested that such overvalued tokens could face a significant correction once trading begins actively, particularly if market demand doesn’t justify their initial pricing.

“When projects launch at inflated FDVs, sustainable growth becomes nearly impossible,” Hayes argued, highlighting past examples where similar tokens collapsed after hype faded.

Market Context and Ongoing Debate

The discussion reflects a wider concern over blockchain projects launching with excessively high FDVs. Investors increasingly view these valuations as disconnected from actual network performance or adoption metrics. Monad, positioned as an Ethereum Ethereum-compatible layer-1 network promising faster execution, has drawn both investor curiosity and skepticism for its aggressive valuation.

Several analysts and developers echoed Hayes’ caution, warning that high market caps can suppress organic token appreciation. Still, others defended Monad’s potential, pointing to its technical innovations such as parallel transaction processing.

Industry Reactions

Crypto commentators note that this debate mirrors tension between short-term market hype and long-term project fundamentals. A number of early-stage investors are reevaluating their participation in tokens with valuations exceeding realistic growth potential, citing the risk of capital lockup in illiquid ecosystems.

The broader takeaway, experts say, is that projects relying heavily on speculative valuation may struggle amid tightening liquidity conditions and more cautious retail sentiment.

“Hayes’ warning is less about Monad itself and more about the structural risks surrounding overvalued crypto launches,” noted one analyst on X.

Author’s summary: Arthur Hayes warns that Monad’s inflated valuation could trigger a steep price drop, exposing broader risks of speculative token launches fueled by excessive hype.

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Bitget Bitget — 2025-11-30

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