While equities have reached new all-time highs this year, crypto is down bad. And a lot of us, investors are frustrated, more than usual even during a bear market.
Sean Farrell is Head of Digital Asset Strategy at Fundstrat, one of the most credible institutional voices covering digital assets and the firm cofounded by Tom Lee. He sits at the intersection of macro research and crypto markets, talking to TradFi market participants every day. Sean is one of the few people in the world interfacing regularly with Tom Lee, helping shape his views on Bitcoin, Ethereum, DeFi, and the future of digital assets.
Here's how Sean and investors in his circle are thinking about where we are right now:
Crypto lagging equities wasn’t a big surprise: No excess liquidity means no need for BTC as a sponge. Marginal capital went into productive earnings-generating assets with less downside volatility, meaning AI capex, broader economic growth. The divergence witnessed this year wasn't a failure of crypto's thesis, but more so the perfect storm of the macro environment meeting crypto’s historically down-year during the 4-year cycle.
Change is on the horizon: Sean believes those liquidity headwinds are now behind us. Earnings tailwinds from the AI capex buildout are still here but arguably in the seventh inning. The conditions that caused the divergence are reversing. Sean’s conversations with TradFi market participants are giving him confidence we're much closer to bottom of the bear market and start of the bull market for cryptoassets, especially compared to where we were at the start of 2026. And by the way, Sean’s no crypto permabull. He was very vocal at the end of 2025 and start of 2026 that crypto was in for max pain and no new highs would be reached, a view that differed greatly from his colleague Tom Lee.
What serious investors are doing right now: Similar to our latest interview with Michael Nadeau, Sean also believes bear markets are when the most money is made. The institutional investors Sean talks to aren't checking out. Instead, they're forging opinions, locking in positions, and identifying which DeFi sectors and assets will emerge strongest. Sean states DeFi application layer tokens with real revenue and buybacks, tokenization infrastructure, and the macro anchors of BTC and ETH are where he sees the most attention being paid.
The macro case for BTC and ETH in every portfolio: The macro backdrop that makes hard assets attractive isn't going away (ie. elevated debt-to-GDP, fiscal deficits, currency debasement). Sean's view is that both BTC and ETH belong in every modern portfolio as the primary expression of that thesis, with the rest of crypto acting as a potential call option on tokenization and onchain finance going mainstream. Personally, Nomatic and I see that call option being ETH.
His bottom line: Investors should start to lock in, and pay attention. The secular tailwinds around tokenization and TradFi moving onchain are still very much intact, with or without CLARITY passing. Don’t be too distracted by the despondency of CT.
Listen to the latest Edge Podcast and follow Sean's research at Fundstrat Direct!
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DISCLAIMER: Nothing said on The Edge Podcast is a recommendation to buy or sell tokens or securities. This content is for educational and entertainment purposes only. Nothing shared here is financial advice. Any views expressed by hosts or guests on the show are solely their opinions. Always do your own research. DeFi Dad, Nomatic, and guests may have positions in the assets or other matters discussed in this podcast.
