On calling tops. Calling a top is full of nuances. Is it a shitpost? Is it a local or global top (reversion for a bit then up again)? Does it affect majors or alts or both? Whether you believe Ansem & co, consider this a call to revisiting your own risk-reward framework 👇

KOLs calling tops has multiple, often conflicting, reasons. I.e. their own risk appetite + reflexive sentiment + their fund+tech analysis But 3 general observations: 1. buyer exhaustion (technicals) 2. lack of strength (fundamentals) 3. unclear path forward post FOMC (macro)

So how do we proceed given KOLs are calling for a "top"? At face value, the prudent thing is to de-risk. The reckless thing is to long into retracements. Even that advice is a bit misguided since not all assets are created equal. E.g. creator meta down & perp dex meta up.

My take: 1. If we are indeed in the last stages of a bull cycle, then the probability of a "top" increases. More influencers calling for a top should revise your probability UP, not down. 2. In which case, downside risk is now increased mostly with the most volatile assets = the alts 3. Bag holders of memecoins, 2021 dino coins, NFTs, outdated narratives beware. You're more likely to roundtrip than others. 4. Liquidity continues to chase narratives hence why perp dexes continue outperforming all other alts. This will continue to be true even in bear markets. What changes is the amount of liquidity chasing these narratives and the rotation that happens at lower profit multiples. 5. Liquidity continues to chase revenue-generating projects. For liquid funds and investors, revenue provides a risk-adjustment based on fundamental analysis making momentum-driven trades easier to enter. 6. Majors (BTC, ETH, SOL) are in their own class and tend to lead (not follow) on macroeconomic and idiosyncratic events. Volatility is less pronounced and thus downside risk is capped assuming support level bidders continue bidding.

Personally, I'm derisking some of my convictions around memecoins (SPX and MOG) and 2021 DeFi majors (AAVE, LQTY, PENDLE and SKY). I will be reducing my borrow LTVs against spot holdings, and I will be reducing my multiplier on perps portfolio. I believe that perp dex meta + creator + tokenization meta will remain strong attractors of liquidity despite broader correction in OTHERS. This is partially due to fractal attention (continue to own mindshare on multiple timeframes), and they are backed by strong fundamentals in terms of revenue and capex. The bet here is that if I'm wrong on timing the attention meta, I am somewhat protected by the revenue meta. Those are: 1. Perp dex meta = $HYPE and $ASTER 2. Tokenization meta = $LAUNCHCOIN and @BaselineMarkets token 3. Creator meta = $PUMP and $ZORA I continue to actively add to my longs on $BTC, $ETH and $SOL as I'm betting on idiosyncratic events being more likely than not in the next few weeks to reverse recent downturn. I am continuing to monitor the situation and will revise this thesis on a weekly basis if we continue to see support levels on MAJORS continue to break.