Pantera founder predicts: the encryption bull run will "last for decades", SOL may be the new king

Dan Morehead, founder of Pantera Capital, shares his views on the current state of the crypto market. This article is based on a podcast episode titled “Phase II of The Bull Market | Dan Morehead” that aired at the end of September, organized, translated, and written by 深潮. (Background: The destruction of belief: The rise and fall of the DATCO model and the future of the crypto market) Summary of Key Points This week, Dan Morehead joined the program to share his insights on the current market situation and outlook for the developments in the cryptocurrency space from 2025 to 2026. In the program, we delved into how Dan built confidence in cryptocurrencies as an asset class in 2013, whether the four-year cycle still applies, financial instruments in the cryptocurrency space, and Dan's investment theory regarding Solana, among other exciting topics. Welcome to listen! Summary of Exciting Insights We have been selling Bitcoin to invest in other projects. Our investors have also received good returns as a result. Currently, we still hold approximately 1 billion dollars worth of Bitcoin. The correlation between Bitcoin and traditional risk assets is not strong; we are in a prolonged bull run of cryptocurrencies lasting several decades. Bitcoin is not a bubble; most people have not truly entered this space yet, and we are still in the early stages of industry development. Many small coins have not performed as expected. The current market hotspots remain concentrated on Bitcoin, Ethereum, and Solana. The Federal Reserve should not only avoid lowering interest rates, but should even consider further rate hikes. The replacement of the dollar is not impossible. This process may take 10 to 20 years and will not happen in the short term. In the next decade, some countries will gradually incorporate Bitcoin into their reserve assets. The higher the interest rate, the higher the cost for governments to borrow. The only way is to invest in hard assets like Bitcoin to hedge against future risks. In the blockchain space, Pantera's investment success rate has reached 86%. Among the companies invested by Pantera, 25 have become unicorns. Past cycles have been very consistent, always two years of bull markets followed by two years of bear markets. Therefore, we usually advise founders to ensure they have a two-year cash reserve to weather the bear market. There is enormous demand in the public market for publicly listed assets in the cryptocurrency space. The returns on Bitcoin and this generation of crypto assets are astonishing, with almost no other assets that can compare. Solana DATS, even with average performance and trading close to par, can still offer about 7% returns through staking, which is far more attractive than traditional ETFs. Currently, our investment in Solana has reached 1.3 billion dollars. Solana's market capitalization is currently only 5% of Bitcoin's, but in the long run, we believe it has the potential to surpass Bitcoin. Age is not the only determinant of success; what truly matters is the founders' capabilities and their deep understanding of the industry. Early Investment Experience in Bitcoin Jason: I've heard many different stories, like how you advised Mike to buy his first Bitcoin, or he advised you, or someone got Lubin involved in their initial investment. Can you share what the initial story was? Dan: My first encounter with Bitcoin was through Peter Berger, who asked me if I wanted to talk about it. I had actually heard about Bitcoin as early as 2011, introduced to me by my brother John. At that time, Gavin Andresen had developed a website called “bitcoin-faucet,” where users could get free Bitcoins. Almost no one knew about Bitcoin back then; you only needed to log in to the site to get some. I was very interested in the concept of libertarianism, so I thought it was cool to see this content and hoped it would succeed, but I did not take any practical action. Later, I had coffee with Pete, Mike, and a few of their colleagues, and this conversation lasted a full five hours. I found the concept of Bitcoin so shocking; it was the coolest thing I had ever seen. They even arranged a space in the office for me to focus on research in this field. From that day on, March 12, 2013, I fully immersed myself in the world of cryptocurrencies and never considered other investment directions again. Jason: I found an email you wrote in July 2013, stating: “The predicted Bitcoin adjustment happened quickly. The current trading price of Bitcoin is 65 dollars, which is exactly half of the price at our first meeting. I think we should actively buy now. I will personally purchase 30,000 Bitcoins this weekend. The fund can choose whether to participate in this purchase; I just want to be involved.” Dan, can you tell us what the situation was like at that time? Dan: At that time, everyone actually thought I was crazy. No one was willing to invest. I sent that email, but almost no one responded. Before that, I had a very traditional career, having worked in hedge funds and Tiger Management, where everything was very stable and predictable. So suddenly turning to a seemingly sci-fi technology project truly left many people unable to understand. When I sent the email, the response was lukewarm, and no one was willing to invest. So I decided to buy Bitcoin myself. At that time, the market was very small, and liquidity was poor. We originally planned to launch this project under the Fortress brand, but it was vetoed by the board at the last minute. So we had to establish independent accounts and funds because the preparations had already been made. In the end, I remitted funds to two exchanges to start buying Bitcoin. One was Bitstamp in Slovenia, and the other was Coinbase, which had only one employee. When I tried to buy, the system showed my trading limit was 50 dollars. I was working on Wall Street at the time, where limits were usually in the millions, not just 50 dollars. So I emailed them, asking for a limit increase. I said, “I just transferred 2 million dollars, please adjust my limit.” Four days later, their only employee, Olaf, replied to me saying, “Okay, now the limit is 300 dollars.” Based on that limit, I could only trade 300 dollars a day, which would take seven years to complete the transaction! Jason: I think many people, especially those who entered the industry in 2020, like those who experienced the DeFi summer of 2020, may not know how the early cryptocurrency industry built its infrastructure step by step, such as custodial services, exchanges, and so on. Dan: Yes, it was indeed very chaotic in the early days. I remember we had 2% of the world's Bitcoins. At that time, there were no professional custodial services; Coinbase had not yet been established, and the largest custodian was Mt. Gox. So I had to remember a lot of Bitcoin private keys myself. But we had been selling Bitcoin to invest in…