June Summary
- June News Highlights: While BTC has been chopping between ~$100K - $110K, we expect a breakout in the second half of the year with a $150K price target by year end.
- Our Take: Institutional Crypto vs Native Alts - Why institutional equities have outperformed alts and why it's healthy for the future of digital assets.
- Key Upcoming Events: Pump.Fun ($PUMP) raises > $1B via an ICO.
June Review: BTC in Chop Mode and Tariff Extension Deadline
BTC has spent the month in “summer chop” mode, ranging between $100K and $110K. It had two local bottoms in June; the first on June 5th when Elon and Trump started fighting publicly, and the second on June 22nd resulting from the Iran-Israel War. Both times BTC dipped to between $98-$100K before bouncing back to $108K.
Our Take: Breakout after the Tariff Extension Deadline August 1st
We believe risk assets (including crypto) should perform well in the second half of the year after the tariff extension deadline passes August 1st, 2025. This gives the US and its trading partners another three weeks to come to the table and reach an agreement.
Given that US equities (SPX, BTC, QQQ, etc.) have recovered from their March lows and are hovering close to or above their all-time highs (ATHs) it makes more sense to wait for clarity on the tariff situation before stocks move higher. However, BTC appears to be front running this move and (at the time of this writing) has already made a new all-time high ~$120K. Looking forward, we expect BTC to continue rallying through Q3 given the amount of capital raised by BTC Treasury vehicles and have a $150K year-end price target.
A Tale of Two Crypto Markets: Institutional versus Native Assets
The disparity in asset performance between “institutional” and crypto native assets (“Alts”) is an emerging trend that we discuss below.
We define the (i) “institutional” market as crypto related equities (CIRCLE, HOOD, etc.) and PIPE / SPAC accumulator strategies (DFDV, SBET, etc.) and define (ii) Alts as crypto tokens outside the top 10 large caps. We previously analyzed the financing and performance metrics of accumulator stocks in our May report, so this month we focus on the varying price performance and those drivers (insert link to May write up).
In short, the institutional market is vastly outperforming the native alt market, and this has left crypto natives extremely frustrated, but ultimately, we believe this is healthy for the long-term health of the market as fundamentals will drive returns rather than hype.
Circle’s Successful IPO and the Institutional Stock Craze:
In March, we highlighted that Circle (CRCL) had pulled its S-1 due to market conditions when the private shares were trading around $3-$4B.
Today, CRCL which has issued > $60B of USDC on chain has a ~$45B market cap ($200/share) despite Q1 revenue and net earnings of $580M and $65M, respectively. Yes, stocks are forward looking but it’s trading over 170x P/E for a business which pays out > 50% of the interest earned to its distribution partners – i.e., Coinbase (COIN) – in a rate environment where most analysts expect front end yields to decrease over the next 18 months.
CRCL’s valuation has ballooned so quickly that Goldman Sachs, the lead underwriter on the IPO, initiated coverage with an $80 price target which would represent a 60% drop from today’s price.
Now compare the institutional outperformance to Alts (referred to as “Others” in the chart below which is another term used to describe tokens outside the top 10 market cap) continue to grind lower grind lower despite BTC hovering near its ATH.
Our Take: Why Is There Such a Divergence in Performance between the Institutional and Native Crypto Markets?
- CRCL’s outperformance is less about the underlying company fundamentals and more about the need for traditional fintech asset managers to maintain exposure to the growth of stablecoins. Circle is the best “pure play” for stablecoin growth therefore it should continue to get bid by institutional allocators at least until insider unlocks occur (6 months post IPO). Similarly, Coin, Hood and other crypto related stocks which generate revenue, publish quarterly financials and can be purchased via a brokerage platform represent a safer and easier way for institutions to get exposure to the space.
- Accumulators (DFDV, SBET, Upexi) should continue to find demand from capital allocators until investors actually lose money on a deal. In other words, if it’s not broke, don’t fix it. Ironically, these stocks do not track (or even correlate that closely) with the underlying asset; however, tracking the underlying is nowhere near as important as making money and these investors are ultimately concerned with making profit, not accumulating more SOL or ETH for the long term. As an example, even SBET which at one point fell 93% from its ATH ($125 à $10), is still higher than the original PIPE price of $6.15.
- The vast majority of alts have systemic problems that cannot be overcome very easily (we outline some of these below). In the long term, we believe it is healthy that the majority of existing alts will trend to 0 because eventually “the cream will rise to the top”, but in the short term, apart from brief periods of outperformance, we expect the pain to continue.
- There are very few alts in the market with (i) product market fit (PMF) – i.e., a revenue generating business that is growing (ii) Value Accrual / Alignment with Token holders and (iii) and no supply overhang. The good news is that tokenomics can be changed to create value accrual for holders and eventually the supply overhang will end as VCs vest meaning these problems are temporary and fixable. Additional, systemic problems include:
- Smaller Capital Base and Smaller Subset of Traders – Most institutional allocators cannot legally buy alts.
- Lack of Product Market Fit (PMF) – Beyond DeFi and CEX tokens, very few alts have a revenue-generating sustainable business. Exceptions to this include tokens in the internet capital markets (ICM) sector such as Pump, Bonk, Launchcoin.
- Lack of Alignment with Token Holders – If the protocol does make revenue, very little of that revenue (if any) accrues to the token. Buybacks, the current way to create value accrual, are not impactful enough to offset sellers and support price unless i) protocol revenue is material and ii) the % of revenue being bought back is also material. We have started buying revenue generating tokens prior to any tokenomic changes, so that we are “ahead of the curve” when the buyback occurs.
- Supply Overhang – Many alts face immense unlocks and combined with a lack of PMF, there is near constant sell pressure (or the perception of sell pressure) for the token. ENA is an example of a revenue generating token with a huge supply overhang. Despite its PMF ($6B of TVL, 5% APY, > $200M in generated fees) it faces approximately $50- $60M of monthly sell pressure making it difficult to own especially considering the ENA token earns none of the revenue.
Market Driver / Catalyst: Pump.Fun ($PUMP) ICO and SOL’s Onchain Performance
Pump.fun is a Solana-based memecoin launchpad that enables anyone to launch a Solana token instantly and bootstrap its liquidity through a crowdfunding model.
Pump is the highest revenue generating protocol of the cycle having earned ~$800M since its launch in January 2024. The revenue generated comes primarily from fees that pump.fun charges on trading volume alongside a small, fixed fee for launching a token.
Pump.fun’s token launcher had great PMF and the team capitalized on this success by vertically expanding and seeking to capture more of the entire value chain, launching their mobile app in Feb 2025 and their own DEX (Pumpswap) in March 2025. The team wants to expand beyond the launchpad, with plans to enter into the casino and gambling market, crypto perpetuals trading and streaming.
Pump.Funraised $1.3B ($720M from institutions and $600M from the public) in its ICO selling 33% of its supply at a $4B FDV. Public buyers could request an allocation either on-chain directly from Pump.Fun’s front end or via a CEX. In the end, $450M (or 75%) of the public raise occurred on-chain with SOL processing 2.7x more transactions than all other chains. In contrast, CEX subscribers faced lag, failed orders and refund queues further highlighting SOL’s performance edge and showcasing why the future of finance is on SOL.
Conclusion
- We expect BTC to breakout above $110K after the August 1st tariff extension deadline if not sooner.
- Instititutional crypto adjacent stocks (CRCL, SPACS/PIPEs) should continue to outpeform alts until investors lose money on an equity deal and demand dries up.
- Only alts with sustainable revenue generating businesses will survive long term and that’s healthy for the crypto market.
- Pump.Fun sold out its ICO in 12 minutes with over 75% of the retail subscriptions coming onchain where SOL performed flawlessly strengthening its positiion as the most peformant blockchain.
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The value of digital asset investments may fall as well as rise, and you may get back less than you originally invested. It is therefore important that you understand the risks involved before investing. This report represents RockawayX’s view at a point in time, and information included has been sourced from third parties, such as companies in RockawayX-managed portfolios. While these sources are considered reliable, RockawayX has not independently verified this information and makes no warranties regarding its current accuracy or suitability for specific situations. We may also take the opposite view/position from that stated in this report. This is because our view may change as facts or circumstances change.
This material constitutes general advice only and not personal financial product, tax, legal, or investment advice, and does not take into account the specific investment objectives, financial situation or individual needs of any particular person. We recommend consulting with your own professional advisers on these topics. Any mention of securities or digital assets is for illustration only and does not imply a recommendation or constitute an offer of investment advisory services. Furthermore, this material is not intended for use by current or prospective investors and should not be used as the basis for any investment decisions regarding funds managed by RockawayX. Any potential investment in RockawayX funds would be subject to documentation such as a private placement memorandum, subscription agreement, and other relevant materials, which should be carefully reviewed in their entirety. The investments or portfolio companies mentioned may not represent all investments made by RockawayX, and past results do not assure similar outcomes in future investments.
