“How the hell does ZEC pump so much?”
“Where does this infinite supply come from?”
“How does an asset go from $200 million to $26 billion without being manipulated?”
Every now and then in crypto, a single asset wins the “Bitcoin Bid” trophy.
Bitcoiners hold their BTC close to their chest. The strength of the Bitcoin community and its narratives created an extremely strong Schelling point around “BTC and BTC only,” and it worked. The effect is currently measured at $1.7T.
This line almost never breaks. Bitcoiners who switch to another asset are humiliated, ridiculed and ostracized. There is one rule in Bitcoin: no shitcoins. The second rule is that anything other than Bitcoin is a shitcoin.
But alas, Bitcoiners are also human. They are not safe from temptation, envy, or greed. Bitcoiner in the streets, shitcoiner in the sheets.
Usually, Bitcoiners default one by one, and no one notices or cares. But every now and then, enough of them defect and switch to the same asset they were using. defection becomes contagious.
This happened to ETH in 2021. This explains why ETH revalued so violently, from $12 billion at the bottom to $554 billion at the top.
Listen to this absolute banger from Su Zhu in October 2021:
— (@)
“It’s at this point now that I know people who have flown across the world to move their Bitcoin into cold storage to buy Ether.
If your brand is a Bitcoin maximalist on Twitter, you can’t capitulate in public because you’ll lose followers, but I’m sure many of these people own a lot of ETH privately, in fact.
– Su Zhu, October 2021
ZEC has created a sufficiently efficient Schelling point for Bitcoin supply. There is $1.7 billion worth of BTC, and it only takes a very small number of Bitcoiners to agree that ZEC is valid, either on its own merits (privacy, quantum) or simply as a hedge for their BTC exposure.
This is why ZEC is only rising. A $26 billion market cap asset is just pennies compared to a $1.7 billion asset, and ZEC will only continue to rise as long as it convinces only a small percentage of Bitcoiners that they should hold just a little bit of ZEC, “just in case” – the same words Bitcoiners use to try to convince the rest of the world that they should own BTC… “just in case.”
Regardless of the increase in the ZEC in dollars. What matters is the relative size of ZEC compared to BTC, because it is its BTC wealth that drives the supply behind ZEC.
Someone will correct me if I’m wrong, but there are very few capital allocators who have ignored BTC, ETH and all other crypto assets, and are bidding on ZEC purely on its merits.
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I believe a similar phenomenon occurs with NEAR.
I think NEAR won the 2026 smart contract bid trophy.
— (@)
The smart contract supply that NEAR is fighting for is obviously weaker than what Bitcoin Bid ZEC is struggling with. In crypto, the store of value has always been first and the smart contract chain second.
ETH’s hold on the smart contract trophy has also historically been weaker than BTC’s hold on the SoV trophy. SOL threatened ETH more than anything that has ever threatened BTC. And Ethereum has always had a looser, more tolerant, more pluralistic culture than Bitcoin’s maximalists allow.
Thus, NEAR likely draws its offering from a more diffuse group of market participants than ZEC attracts Bitcoiners. But the effect is nonetheless the same.
Fewer people want to buy high value stocks, simply because the returns aren’t there. Both also carry too much tech debt and appear technologically behind in 2026.
Unfortunately, this dynamic poses a problem for the crypto industry: someone still needs to buy the blue chips.
Bitcoin must evolve beyond a volatile digital currency to become a full-fledged alternative to gold. Lately, it doesn’t seem like BTC has fulfilled this role, and for all its shortcomings, gold is still gold.
And who will buy ETH after Tom Lee? I still don’t see any evidence or stories that would re-rate it by 10.
How does our industry progress if numbers 1 and 2 don’t grow 10x from here? It will progress, that’s for sure. Hyperliquid, Venice, Lighter, Ethena and Morpho have all brought incredible innovation. But unless the total crypto market cap grows from $3 trillion to $30 trillion, the value created by these startups will likely be captured outside of crypto rather than by our native blue chips.
Robinhood, Coinbase, Apollo, and traditional brokerages appear much better positioned than BTC and ETH to reap the benefits of this latest cohort. It is questionable whether BTC and ETH capture any significant value.
If this dynamic continues, we may still find new winners, but the overall size of the industry will remain more specialized than the aspirations we once had.
I hope I’m just impatient and the total crypto market cap really exceeds $10 trillion this cycle!
Millions!
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