Wintermute CEO: The crypto dilemma stems from "centralized" institutions, still has faith in the industry
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Wintermute CEO: The crypto dilemma stems from "centralized" institutions, still has faith in the industry
What we truly need to do is build and influence others.
Navigating Web3 tides with focused insightsAuthor: Wishful Cynic, Wintermute CEO
Translation: TechFlow intern
People look at price charts, BTC rainbow charts, past halving patterns, etc., to HODL and time their bottoms. Clearly, this is astrology for men. But ultimately, I believe it all comes down to macro and faith.
1) What is macro? Macro refers to large institutional players who don’t care about Bitcoin’s mission, whether AAVE’s tech is better than COMP’s, whether SOL is faster, or whether Optimism or Polygon will scale Ethereum...
Instead, they focus on:
a. Interest rates
b. Relative valuation
They wonder if DeFi will follow the Nasdaq up 100% tomorrow—or vice versa. Same with VCs. Unless they’re pure crypto-native venture firms (many of which may underperform anyway), there's little incentive, so we generally don't see much action from them.
Perhaps Paradigm will keep raising funds, maybe a16z will buy some tokens on the secondary market. But that won’t move enough price candles. What drives prices upward is faith.
2) Faith is where the entire industry began. At first, it started as a dream of another world—a world where we’d break free from governments and traditional financial systems, a world where we’d achieve truly decentralized value storage.
Then came another belief—that early supporters should capture most of the upside through token distributions, NFT sales, and metaverse land. Meanwhile, we had the BTC rainbow chart, halvings, “Bitcoin will never trade below previous highs,” and so on—all reinforcing our faith.
These beliefs created internal bids, a method that ignored all external valuations. A method ready to stand independently from the outside world. This dream could be realized if we could transition into a decentralized metaverse.
This cycle, however, we’ve managed to create opposing beliefs:
● That crypto harms the environment—highly hypocritical (why single out crypto?), but popular.
● That crypto/financial markets are purely speculative, ignoring the key feature—ownership.
While partly an excuse concocted by hostile regulators, the impact has been significant and requires substantial effort to overcome.
3) Our current crisis stems from centralized entities. Terra itself wasn’t dangerous—decentralized protocols rejected its widespread use as collateral. Instead, it was centralized groups chasing its 20% APY.
Celsius was the same—regardless of what caused its withdrawal freeze, it fundamentally couldn’t be decentralized. But add another highly centralized entity—3AC—and you get the massive destruction we see today.
In fact, we still don’t know how many lenders, exchanges, or others are mid-liquidation. It might take one or two weeks before we see all the bodies wash ashore. In the meantime, we’re witnessing de-leveraging in the industry at an unprecedented scale.
As long as centralized imposters exist among us—no matter how well-intentioned or vague—we lack a transparent enough system to predict what happens next.
Ultimately, we must accept that our industry will always be subject to the influence of the wider world—unless we turn our industry into that world, unless our industry becomes the system.
4) Faith brought us here. Recently, I feel we're facing an order of uncertainty we've never seen before. On one hand, it's justified; on the other, it's uncomfortable—and I’m sure I’m not alone in feeling this way.
Go back to 2008–2009—I remember clearly, everyone talked about the economic crisis. Global regression by a decade, EU disintegrating from PIIGS. It felt terrifying. But in hindsight, compared to the past 2.5 years, it clearly pales in comparison.
I see people who’ve worked in this space for a while starting to waver, but I don’t feel that way. I entered crypto in 2017, drawn by returns far exceeding those in traditional industries. Over the past five years, I’ve slowly but clearly realized it means more.
But I don’t believe crypto will succeed 100%. Maybe all we’ll see is Bitcoin becoming digital gold—held like physical assets. Still, I’m here to help build another reality.
I want a more exciting reality, a more resilient one compared to the centralized systems we live with today. We can certainly fail—but that’s precisely why I’m here, my mission and purpose.
But if I were completely disillusioned with crypto, or believed its chance of success too low—what else could I do? The outside world is a barren desert, except for space travel, which still sparks a bit of passion in me.
I worked at Optiver for 10 years, progressing from junior to senior trader. Every finance novel describes that journey—no need to repeat it.
In the end, I came here—to this field—with no way back, only forward. Tens of thousands of assets flow in and out, buyers become sellers, sellers become buyers. But what we really need to do is build and influence others.
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