Good morning, Monday!
As always, I’ve put in the time to summarise what I’m seeing from my (relatively unique) seat: between the allocators and the quant trading teams, and these days the quant hiring side too. That’s three angles on the same market, and this week they’re all telling me the same story.
EVERYONE IS TIRED
Let’s start with the mood. It’s the loudest signal right now.
People are ridiculously tired. I’ve said it before, and it’s only become more obvious. Not panicked, not angry, just tired. The veterans know better times come back, they always do. But knowing it and waiting for it are two very different sports.
It’s been so long now that the tradable universe has settled into something almost sleepy. Order books are stacked with resting limit orders. Nobody’s taking real risk. Range, then another range, then a range inside the range.
Here’s the example that says it all. Solana is days away from the biggest consensus upgrade in its history. Alpenglow switches on this Wednesday and takes finality from roughly 12.8 seconds down to around 150 milliseconds. That’s about 85 times faster.
In 2021, a headline like that would have sent SOL flying on the rumour alone. This time it spent last week hovering around $107 with barely a pulse.
No catalyst moves price anymore. Not upgrades, not partnerships, not “the biggest milestone in our history” press releases. Noone seems to giving a fuk.
My read on why: AI stole the shiny object. Crypto used to be the thing everyone talked about at dinner. Now AI is, and crypto is the ex gf nobody brings up. Attention, talent and speculative capital have walked to a different street, and they’re not looking back.
People are leaving. Not just the tourists, but also the ones who swore they were here for the long run and were waiting for the bounce.
Honestly, I understand the logic. There are plenty of better opportunities out there, and crypto comes with a lot of baggage: the scams, the hacks, a retail crowd that has mostly disappeared, and liquidity that’s still a fraction of what it was.
To be fair, liquidity has improved quite a bit. Some trades are back. Funding and basis are slowly, slowly returning. But “slowly returning” doesn’t pay for anyone’s patience, so a lot of people look at the setup and decide it’s just not worth it.
If you want to be the one reaping the rewards later, you have to stay in the game. But plenty of managers and allocators decided the risk and the wait weren’t worth it, and walked. And honestly I do not think they are wrong.
A THIRD OF THE ROOM HAS LEFT
Here’s the part I find genuinely interesting.
By my count, more than a third of the allocators I knew in this space have left the game entirely. 35%, maybe more, for all sorts of reasons: mandates pulled, teams restructured, people moving to AI, people simply exhausted, getting rekt, scams - all that combined. From where I sit, that exodus has accelerated over the last couple of months.
That’s not a bearish signal. That’s what bottoms look like.
Back in July, I wrote that everyone was waiting for October and the “official” four-year-cycle bottom. Well, it’s October. And the room looks exactly the way rooms look right before the turn: quiet, half-empty, and convinced nothing will ever happen again.
The best returns have always come when most people have given up. Retail works the same way: the moment everyone finally sells their worthless bags in disgust is usually the moment they would have doubled. Same psychology, bigger tickets.
Something else is happening underneath. New blood is coming in. The industry refreshes itself constantly, and the people arriving now don’t carry the scar tissue from the last cycle. Some of them will make a lot of money from the people who just left.
So here’s my controversial bit:
The people leaving now will be back at the top of the next cycle, paying full price for the same opportunities they could have backed at a discount today.
I’ve watched it happen before, and I’ll watch it happen again. Which is why the only assignment right now is the one I keep repeating: survive the wait.
If you’re a quant team still in the game and you want to be positioned for when the market grows again, the work you do in the quiet months decides it. Better data, better research, better execution. Which brings me to this.
Same rule as always: I occasioanlly feature things I use that I believe are massively beneficial for others alike.
Most mid-frequency crypto teams spend a surprising share of their time on plumbing rather than alpha: collecting ticks, fixing gaps, rebuilding features so they match between backtest and live.
Aperiodic is the data platform that makes all of that someone else’s problem. What you get: 220 point-in-time microstructure metrics (order flow, liquidity and impact, L1/L2 book, funding/basis/OI) on Binance, OKX and Hyperliquid perps, from 1-minute to daily bars.
History has no rate limits, and since this month it’s live over WebSocket, so the same features you backtest on are the ones you trade on.
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Honestly,it's an absolute no-brainer for teams.
You will for sure find unique & useful metrics in there!
Questions go to Mark on Telegram (@almostintuitive).
THE NARRATIVE CONVEYOR BELT
There are, of course, many ways to stay competitive. The most important is generating alpha, and in this market I believe it’s moving heavily towards RWAs. Most of the money I know of that’s being made right now is being made there.
But zoom out and you’ll see a pattern. There’s always a new market that is, for a while, wonderfully inefficient. Prediction markets. The AI boom. Hyperliquid. Now RWAs.
These trends come and go like sushi on a conveyor belt. To eat, you need two things: skill first, then timing. You have to grab the right plate as it passes, not three minutes after it’s gone. Crypto narratives work the same way. Hit the right one at the right moment and you monetise it. Miss it, and you’re reaching for an empty plate.
And btw the belt moves fast.
Here’s what I’m seeing on the hiring side: prediction markets are still hot. Tier-one and tier-two shops are hiring heavily for them. Jump has doubled its prediction markets team this year to about 20 people and is still hiring. DRW has built a dedicated desk.
Why are some of the biggest quant firms on earth hiring people to trade sports and election contracts?
Because there’s still inefficiency left. And there’s still inefficiency left because there’s still retail.
That’s the part people underrate.
Retail flow is the oxygen of alpha.
You can be the smartest team in the world, but if everyone on the other side of your trade is equally smart, you’re just cutting the same pie into thinner slices. The edge comes from somebody making decisions for reasons that have nothing to do with price. The reporting on Jump’s desk says as much: its performance there depends partly on retail traders’ biases.
Which is exactly why I’m watching RWAs so closely.
Right now, RWAs are mostly institutional plumbing: tokenized Treasuries, money market funds, private credit. Retail isn’t really there yet, at least not at scale. But when it arrives, it will be the massive trade. Market buy orders from every direction. Think Robinhood, Revolut, every neo-broker with an app and a “trade 24/7” button. Robinhood already launched its own chain built for tokenized assets in July. That flow will create a lot of inefficiencies.
But don’t get excited too fast.
That flow will be sold to the XTXs and the Jumps of the world, and they’ll eat first. Retail flow is a buffet, and the biggest market makers have the 7pm reservation. The rest of us arrive at 11 for whatever’s left on the trays.
Still a meal. Just know where you’re sitting.
THE LAST CRYPTO-NATIVE QUANT
Which brings me to what I actually wanted to say this week.
My belief is that in the next cycle there will be no crypto-native teams. Not among the best performers, anyway. I mentioned it before.
The best-performing teams will be multi-asset. They’ll trade the top 50 in digital assets. They’ll trade gold. They’ll trade oil. They’ll trade equities, and one or two main currencies. One book, every asset class, under one umbrella.
The edge won’t be “we understand crypto.” It will be “we understand flow, wherever it shows up.”
The whole asset management industry is moving in exactly that direction. One broker. One platform where you run the SMA. More and more, the world is heading towards a state where there’s no such thing as a separate asset class. TradFi is merging into digital assets, and digital assets are merging into TradFi, in real time.
You can already see it. Robinhood now offers EU users perpetual futures on gold, silver, stocks and crude oil, right next to its crypto perps. A year ago that sentence would have sounded like a pitch deck. Now it’s a product page.
It’s happening gradually and slowly, and then all of a sudden you’ll realise the shift has already been made and we’re all living in a new reality. Hemingway wrote that people go bankrupt “gradually, then suddenly.” Market structure changes the same way.
So, practically:
If you’re a crypto-native team, start building your second asset class now, while it’s quiet and nobody’s asking. By the time allocators start demanding it, it will be too late to start.
If you’re an allocator, stop thinking in “crypto bucket” terms. A team that trades BTC basis and gold carry from the same risk engine isn’t drifting from its style. It’s the future, and it may end up being the most valuable team in your book.
If you’re a quant looking for your next seat, learn the second market. The shops hiring hardest right now aren’t hiring for crypto. They’re hiring for whatever is inefficient this year.
BEFORE YOU GO
If you’re a team building out multi-asset or prediction markets capability and need people, that’s something we help with it. The same goes if you’re the person looking for that seat. [email protected]
The referral offer stands, as always. Know someone genuinely worth an introduction? Make it, and we’ll pay you for it.
All right, until the next one.
Stay patient. Stay honest. Stay alive.
Quants.Space is an institutional discovery engine for systematic and discretionary trading strategies: 130+ independent, world-class quantitative and discretionary trading teams, each with vetted track records and unique alpha sources, plus a dedicated Emerging Managers sector for early-stage teams. Our mission is simple: connect institutional capital and allocators directly with best-in-class teams, all within a secure Separately Managed Account (SMA) framework. If you’re an allocator active in the SMA space, or a team opening SMA capacity for institutional tickets, get in touch at [email protected].
