Arthur Hayes is back, tossing cold water on the Circle IPO lovefest and setting fire to what he calls the early tremors of stablecoin mania. According to him, Circle’s flashy Nasdaq entrance is not a victory lap, it is the starter pistol. What follows is a parade of desperate imitators, all trying to squeeze a few billion out of the public markets by stapling together interest spreads, some regulatory fluff, and a freshly tailored suit. They pitch hard, dress sharp, and collapse faster than an altcoin on unlock day.
This is not about utility, and it certainly is not about fixing anything broken in the system. It is pure showmanship, seasoned with leverage, and wrapped in just enough compliance buzzwords to pass through a risk committee half asleep. Hayes makes it clear that these IPOs will pump, not because they work, but because they are shiny. And shiny sells. Especially when everyone is still pretending regulation means something other than who gets the microphone. Shorting them is a bad idea, he says, unless you enjoy watching your margin evaporate while the herd cheers the word “regulated” like it was gospel.
Still, he is not suggesting you hold. These stocks, he says, should be traded like a hot potato. Catch it, feel the heat, pass it to the next greater fool. The value here is not in holding, it is in timing your exit before the stage lights cut out and everyone pretends they never heard of stablecoins. The core problem remains untouched, distribution. Without pipes, your product is just a balance sheet cosplay. Hayes outlines it clearly, you either plug into a major exchange, latch onto a Web2 behemoth, or find a legacy bank desperate enough to partner with you. If none of those doors open, your stablecoin dies in the womb.
Social platforms and banks are not waiting for you, they are building their own. Exchanges are gatekeepers, not charities. And the cost of plugging into liquidity is rising, just like everything else. These new firms will burn capital faster than they can explain what yield actually means, and once the music slows, the exits will be narrow.
Even Circle, Hayes says, is propped up on sentiment. CRCL is overvalued, hands off half its interest income to Coinbase like it is paying protection money, and still levitates because hype gets priced faster than fundamentals. It does not matter if it works, it only matters that it looks like it might for a few quarters.
The wave is coming, and it will carry junk with it. You can surf it for a while if you are light on conviction and fast on the draw. Just do not fall for the suits. Most of these clowns are here for the bell-ringing photo, not the long haul.