The Macro Trend: The transition from static benchmarks to live human-in-the-loop evaluation. As models saturate fixed tests, the only remaining signal is subjective human preference at scale.
The Tactical Edge: Monitor secret model drops on Arena to spot frontier capabilities before official releases. This provides a lead time advantage for builders choosing their tech stack.
The Bottom Line: Arena is the new kingmaker. If you are building AI products, their expert-tier data is the most reliable map for navigating the frontier.
The move from small models to medium models (15B to 70B) suggests that reasoning capability is outstripping the desire for low-latency edge deployment.
Implement instruction-following re-rankers to prune your context window. This prevents the model from getting confused by irrelevant data.
Stop building toys. The next year belongs to those who can build full agentic systems that handle billions of tokens without losing the plot.
The Macro Trend: The transition from black box scaling to transparent steering. As models enter regulated industries, the ability to prove why a model made a decision becomes more valuable than the decision itself.
The Tactical Edge: Deploy sidecar models for monitoring. Instead of using expensive LLM-as-a-judge prompts, probe specific internal features to catch hallucinations at the activation level.
The Bottom Line: The next year belongs to the pragmatic researchers. If you cannot explain your model's reasoning, you will not be allowed to deploy it in high-stakes environments.
From Singular Logic to Pluralistic Systems. As we build complex AI, we must move from seeking one "correct" model to managing a multiverse of conflicting but internally consistent logical frameworks.
Audit for Incompleteness. When designing protocols, identify the "independent" variables that your system cannot prove or settle internally.
Truth is bigger than code. Over the next year, the winners will be those who stop trying to "solve" the universe and start navigating the multiverse of possible truths.
Outcome-Based Intelligence. We are moving from AI as a Service to AI as an Outcome where value is tied to results rather than usage.
Target Non-Public Data. Build applications in sectors like law or lending where the most valuable data is private and un-crawlable.
The next two years will separate companies that use AI to save pennies from those that use AI to capture entire markets through autonomous systems and proprietary data loops.
**Consolidate or Compete.** Sub-subnets allow teams to build diversified businesses under a single token, while deregistration means underperforming projects will be pruned. The message is clear: innovate and perform, or be replaced.
**Investment Thesis Evolves.** Subnet tokens are no longer "eternal." Deregistration fundamentally changes the risk profile, making active development and market traction paramount for long-term viability.
**Governance is Coming.** The network is on a clear path to decentralization. The planned shift to Proof-of-Stake and a more democratic governance structure will steadily transfer power to subnet owners and stakers, making community participation more critical than ever.
Global liquidity is the ultimate macro signal. As long as the global liquidity chart goes up and to the right, the crypto bull market has the fuel it needs to continue its run.
Ethereum isn't losing; it's quietly winning the RWA war. With 93% market share, Ethereum has become the de facto settlement layer for tokenized real-world assets, a lead that continues to grow as institutions like Fidelity build directly on its L1.
The new blockchain business model is asset management. Chains like Hyperliquid and Mega ETH are pioneering a shift away from relying solely on blockspace fees. By integrating native stablecoins, they are capturing a percentage of the yield from assets on-chain, effectively turning the protocol itself into a revenue-generating asset manager.
LSTs Are a Distribution Play: For protocols, launching an LST is less about staking yield and more about attracting SOL to gain a strategic advantage in securing blockspace and landing transactions.
Infrastructure Follows the User: Sanctum's pivot to transaction services was not a top-down mandate but a direct response to the needs of its largest partners, proving that the most durable infrastructure is built by solving the immediate, pressing problems of your customers.
Aggregation Is King: Just as Jupiter won by aggregating DEXs for users, Sanctum’s Gateway aims to win by aggregating fragmented transaction delivery networks for developers, creating a simpler and more efficient experience.
Patience is Your Superpower. This cycle rewards thesis-driven investing over hyperactive trading. Identify assets with strong value, momentum, and fundamentals, and give them time to play out.
Bet on the On-Chain Casino. The gambling economy is real, profitable, and growing. Look for platforms that facilitate high-asymmetry games (memecoins, raffles) as they capture a powerful cultural trend.
Find Alpha in the Illiquid. The next frontier is tokenizing real-world value. Platforms creating liquid markets for previously stuck assets—from collectibles to crime—are building foundational infrastructure for a much larger on-chain world.
Revenue Accrual is King. Hyperliquid's model of directing nearly all top-line revenue to token buybacks creates an aggressive and constant bid for the HYPE token, a feature most crypto projects can only dream of.
Product-First Beats VC-First. Its explosive growth comes from building a superior product that attracted a loyal user base first, then leveraging that traction to build an L1 ecosystem—a stark contrast to the typical VC-funded playbook.
A Bet on the Middle Ground. Investing in HYPE is a bet that CEX-level performance and on-chain transparency can outweigh significant centralization and regulatory risks. It’s a category-defining play that sits squarely between DeFi and CeFi.
Hyperliquid is a Cash Flow Machine. It is a rare crypto asset with quantifiable fundamentals, generating over $1B in annualized free cash flow with an automated, daily 99% buyback mechanism.
Access is the Arbitrage. The NASDAQ-listed vehicle’s core value proposition is providing regulated access to an asset that US investors cannot easily buy, creating a structural opportunity.
Innovation is Now Permissionless. Hyperliquid’s open architecture allows anyone to build on its rails, enabling new markets like pre-IPO equity trading and accelerating growth without traditional gatekeepers.
