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Hi all, happy Wednesday! Markets leaned risk-on over the last 24 hours, with crypto decisively outpacing traditional assets and sector dispersion back in focus. In addition, we explore MegaETH’s Frontier and briefly introduce the equity perpetuals landscape and why it excites us.

Markets opened to a clear risk-on tone, with crypto sectors sharply outperforming traditional assets. BTC posted a modest gain of +0.8%, while Gold (+1.0%) performed similarly. However, equities lagged meaningfully as the S&P 500 (-0.9%) and Nasdaq 100 (-1.3%) both slipped, reflecting a mild unwind in tech momentum. Crypto equities also softened (-1.0%), suggesting the rotation favored onchain assets rather than public proxies.

Crypto sector indices saw broad strength, with DePIN (+6.2%) and AI (+6.1%) leading the board amid continued enthusiasm for infrastructure-heavy narratives. Ethereum-aligned assets (+5.1%) and Revenue-generating protocols (+4.3%) also climbed, hinting at renewed investor appetite for cash-flow visibility as activity improves on major L1s. Launchpads (+4.1%), Gaming (+3.8%), and Solana-ecosystem names (+3.3%) followed, rounding out a day dominated by high-beta segments. Even traditionally slower sectors like RWA (+3.1%), L1s (+3.0%), and DeFi (+2.8%) participated, while L2s (+1.8%) and Modular (+0.3%) underperformed relative to the rest of the crypto complex.

The move appears to have been driven less by macro catalysts and more by positioning. With equities cooling and rates stable, crypto’s higher-volatility sectors benefited. Looking ahead, volatility remains compressed, but today’s dispersion hints that rotation trades are back in focus. With macro data light over the next 48 hours, crypto may continue to trade on sector-specific flows and narrative momentum.

— Marc

MegaETH’s “Frontier” mainnet beta was announced and starts in early December 2025. This announcement drops into a market primed for speed-as-a-moat narratives and any catalysts or excitement during the current downturn. With Frontier running for one month in December (with zero incentives!), early flows are likely to pivot toward infra and app plays that are incredibly fast. Think high-frequency options and reactively-updating onchain games, segments that have been bottlenecked by block cadence rather than liquidity. Sentiment is cautiously optimistic: “real-time blockchain” messaging positions MegaETH as the execution-layer analogue to Solana’s UX but with Ethereum’s settlement trust. That “forced inclusion from day 1” call-out also matters as it frames MegaETH not as a parallel universe L2 but as a high-performance lane plugged into the ETH security budget. This subtly shifts the modular narrative from “many uncorrelated rollups” to “one performance frontier.” 

On the valuation front: MegaETH’s public sale opened with a starting fully diluted valuation (FDV) of about $1 billion for 5% of supply, while the auction cap sat at roughly $999 million. Meanwhile, futures contracts on platforms like Hyperliquid implied an FDV in the $5-$6 billion ballpark ahead of token launch. The spread from the auction cap and futures pricing suggests that speculators are already betting on a substantially higher launch valuation than the public sale implies. From a market-dynamics lens, this divergence means the derivative markets are frontrunning launch expectations, creating a potential mismatch between early allocation pricing and broad-market demand. If the actual listing price aligns with the futures-implied $5-$6 billion FDV, early backers could enjoy a sharp upside. 

High-speed apps that prove real user loops could see speculative capital frontrun expectations before the beta ships. However, downtime is explicitly expected (it’s happened with EVERY “fast chain”), so levered bets on “MegaETH never breaks” may be mispriced.

— Marc

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Equity perpetuals

Equity perpetuals seem to be the single sector dominating most mindshare over the past few weeks, with the launch of multiple Pre-IPO and public equity perpetuals markets on Hyperliquid by various HIP-3 market providers, including Ventuals, Felix and trade.xyz.

At their core, equity perpetuals promise two new forms of tradable markets, which have not existed yet, or have not existed meaningfully:

• Perpetuals futures on equity products

• 24/7 trading of equity products

Apart from recent HIP-3 markets, we saw steps taken toward equity perpetuals a few times over the past few years, most recently by Ostium, but previously by Gains Network as well.

Both Ostium and Gains Network use a peer-to-pool model, where traders trade against a pool of capital (which liquidity providers deposit into). Although an improvement on the GMX v1 style pools, where LPs had to hold a broad basket of risk assets (BTC, ETH, UNI, LINK etc.), peer-to-pool trading still struggles due to difficulties in scalability. In addition, toxic flow could take advantage of the pool, which always has to take the other side of the traders. However, overall, we’ve seen some of these pools be profitable for a long period of time (although it can end up like the “1000 days in the life of the turkey” charts every once in a while).

Similarly to the shift away from peer-to-pool perpetuals models, order book based equity perpetuals have also become increasingly more popular compared to Ostium. For example, while NDX-USD on Ostium has seen $5.5 million in volume on Ostium over the past day, XYZ100 (tradexyz’s Nasdaq 100 market) has seen $75 million in volume. Similarly, while TSLA-USD on Ostium has had only $1.4 million in 24-hour volume, the trade.xyz TSLA market has had $12 million and the Felix TSLA market has seen $2.6 million in volume.

There are other equity perpetuals platforms coming up slowly as well. One new player is Vest markets, which also provides equity perpetuals for a broad range of assets, including equity indices like Nasdaq 100 (24-hour volume: $9.5 million) and SPY (24-hour volume: $7.5 million). We also expect other competitors to pop up over the next few months, in particular Lighter, which will likely deploy equity perpetuals at some point.

In particular, we believe internally that equity perpetuals offer an opportunity for perpetuals platforms to get more involved in the tokenization space. Thus far, most tokenization has benefited spot DEXs and lending products. However, perpetuals platforms can now start getting involved as they launch more markets. We believe that perpetuals are a great way to take on risk (but not to hedge risk!), especially for retail traders, given they are more intuitive. With increasing demand from retail for options (particularly 0DTE options) to gain leveraged exposure to the stock market, we believe that perpetuals can largely replace this demand and provide the best venue for doing so. 

— Boccaccio

1. Crypto Trends

Variant’s Alana published a report which looks into five key thematic areas — macro, stablecoins, centralized exchanges, onchain activity and frontier markets — to predict where the industry may be headed.

2. Privacy on Solana 

Umbra, a privacy-focused transaction layer on Solana, is integrating Range’s Onchain Risk Verifier to bring real-time, verifiable compliance directly into its smart contracts. The system enables private transfers while maintaining full auditability, using one-time keys, encrypted balances and Master Viewing Keys. With Range’s signed, onchain risk scores, Umbra can enforce sanctions, block high-risk wallets and apply risk-based controls without compromising user privacy. The integration is in testing now and will go live with Umbra’s mainnet launch.

3. Zcash Foundation Q3 2025 Quarterly Report

Zcash Foundation released its Q3 2025 quarterly report covering organizational progress and financial performance. The report highlights the launch of the Shielded Aid Initiative (SAI), which provides privacy-preserving technology for humanitarian organizations distributing digital cash aid. SAI addresses the problem of transparent blockchains exposing vulnerable beneficiaries' personal data. The foundation also announced a three-year community events vision including virtual gatherings, developer summits and regional conferences. Engineering achievements included releasing Zebra v2.4.2 and v2.5.0 with NU6.1 implementation, plus FROST v2.2.0 with critical security fixes. Q3 operating expenses averaged $199,377 monthly, with 51% allocated to protocol development. The organization held $15.9 million in liquid assets, primarily in ZEC (57%) and BTC (30%).