I've been seeing a lot of people in the crypto space pretty devastated over the last couple years. There was a rally that looked like a bull market, but most people didn't make money. Instead, Bitcoin outperformed a bunch of so-called high-beta altcoins.

Let me give you a logic that basically explains why you got liquidated. The story starts with FTX's collapse.

After FTX entered bankruptcy liquidation, the management team had only one goal: convert all assets into cash as quickly as possible. That included a massive amount of locked-up SOL.

The problem is, this SOL is locked on-chain and can't be sold in the short term. So they came up with a workaround: through legal agreements, they sold future tokens—taking money now and delivering it after the lockup expires in the future.

These deals spread quickly through the market. Many institutions bought this locked SOL at roughly a 40% discount or even steeper, using the discount to cover time costs and price risk.

Hedge funds especially love this structure because they can buy discounted spot on one side and simultaneously short SOL in the futures market, completely hedging away the price risk. This turns the profit into: lockup discount + staking yield + basis spread—altogether delivering 70-80% annualized returns with very low risk.

After they made money, naturally they asked: can we get more of these opportunities?

That's where the real problem emerges. This is actually the core structural issue of the entire crypto market from 2023 to 2025.

Almost every project team, foundation, and early investor has massive locked tokens. On the surface, these coins unlock in the future for sale, but in reality they've already been sold to institutions through similar structures. To lock in returns, these institutions continuously short in the futures market, and that selling pressure gets passed directly to the secondary market—which means onto regular retail investors.

In other words, the upside you think you have was already extracted by hedge funds using market-neutral strategies.

That's why altcoins have underperformed overall these past few years. It's not lack of capital—it's that returns are pre-allocated. You're getting the hedged price.

From another angle, there's actually a slight positive: many projects look like they have massive future unlock pressure, but in reality those tokens are already sold off-market. When they actually unlock, there might not be as much selling pressure as you'd imagine.

In theory, that structural pressure could weaken in the next cycle. But the conclusion is also pretty realistic: this market is fundamentally like a casino, with rules tilted toward the house.

The house from 2023 to 2025 is those institutions that figured out and participated in this arbitrage structure.

If you're not a participant in that chain, achieving consistent excess returns long-term will be very difficult.

For most people, simply holding Bitcoin might actually be the more rational choice.

$BTC