BroadChain News, April 27, 12:00 PM - Alex Xu, a research partner at crypto investment firm Mint Ventures, recently disclosed that he further reduced his BTC position, which had already been lowered to 30%, during the rebound to the $78,000-$79,000 range. Previously, he had closed a small leveraged position (approximately 1.1-1.2x) established through BTC collateralized loans during the bear market around $70,000, and reduced his BTC holdings from full allocation to about 30% in the $100,000-$120,000 range.
This move is based on a reassessment of BTC's long-term bullish narrative. Alex Xu pointed out that the potential momentum driving the next BTC bull market is no longer as strong as in previous cycles. In the past, the exponential expansion narrative of BTC's investor base—from geek experiments to mass and institutional asset allocation—peaked in the 2023-2025 cycle through the listing of compliant ETF products, support from mainstream financial institutions like BlackRock, and endorsement by the world's largest country's president. To upgrade the narrative further, the next cycle would need to involve sovereign balance sheets, such as sovereign wealth funds (currently only Abu Dhabi) or central bank reserves. However, the purchasing power of U.S. state fiscal reserves is limited, and only a few states have passed BTC reserve bills so far. Expectations for the Fed to include BTC were largely disproven last year. Major central banks show little interest in BTC due to its short consensus history, high volatility, and competition from gold, making its inclusion in central bank balance sheets extremely difficult.
Additionally, rising personal opportunity costs are another reason for the reduction. Over the past six months, Alex Xu found that several high-quality companies are currently priced attractively, making them a focus for portfolio adjustments, while another portion is allocated to increasing cash reserves. The negative impact of the overall crypto industry downturn on BTC demand and consensus cannot be ignored: currently, only DeFi generates positive cash flow and profits within the industry, but the contraction of high-quality native assets has led to business shrinkage. Most Web3 models (social, gaming, DePIN, distributed storage, etc.) have been disproven over time. The shrinking industry base, along with fewer practitioners and investors, will lead to slower or even declining BTC holdings. Hyperliquid, as an on-chain exchange, has bucked the trend with growth, but its success mainly stems from capturing market share from CEXs and introducing 24/7 trading of non-crypto assets, with limited direct value transmission to BTC. Moreover, its isolated model reliant on regulatory arbitrage is unlikely to offset the industry's contraction trend.