Arthur Hayes Warns Monad Is a High-Risk VC Coin That Could Crash

The crypto market is no stranger to hype. The recent launch of the much-awaited Monad token was no different. Following the mainnet launch, Monad saw very high volatility, and prices swung back and forth, terrorizing the investors.

Most recently, former CEO of BitMEX, Arthur Hayes, has added to this volatility by stating his certainty regarding the crash of Monad. According to Hayes, Monad is a high-risk VC or venture capital coin that is running entirely on pumped hype.

Hayes seems to have several problems with Monad, as he clearly pointed out that the token structure alone puts retail traders at high risk of losing their investments. In this article, we will take a look at Hayes’ harsh criticism of Monad, whether there is any evidence to back up his arguments, and what Monad’s future looks like.

A High-Performance, EVM-Compatible Chain Fueled by Ambition and Major Backing

Unlike the numerous pump and dump token scams, which often operate on the venture capital model and have tainted the very idea of venture capital in crypto, Monad stood different for its technical ambitions. Monad was never thought of as a fake or scam by early-stage to late-stage investors.

Monad had brought with it big promises. It promised the EVM compatibility that could rival Ethereum and challenged Solana’s high throughput. With an estimated 10,000 TPS(Transactions Per Second), Monad was going to combine the best of both worlds, according to the team behind it.

The venture capital run gained momentum as Paradigm, a popular crypto venture capital firm, entered the arena. Following the inflow of Paradigm’s 225 million US dollars, Monad saw an explosive investor interest. Confidence in the asset soared around this time, and pre-sales went amazingly well.

What attracted Paradigm was indeed Monad’s robust architecture. Monad could easily replace Solana and Ethereum in one package if their technical claims are true. With such an industry veteran backing Monad, investors had no second thoughts, until now.

The Criticism From Hayes

Before taking about Hayes’ criticism of MON, we must first attain some ground regarding the complex context in which Hayes has made his arguments. Hayes was initially a supporter of the Monad network. His later-stage flip on MON has caused widespread criticism against Hayes himself.

Many called Hayes an insider and said that he was profiting at the expense of others since Hayes had flipped his opinion at the last moment. Hayes recently commented on MON that it was yet another high FDV(Fully Diluted Valuation), useless L1 coin.

However, in this context, we have to understand that Hayes does not have a problem with the technology of the token; rather, it is the tokenomics that has upset him. Hayes strongly pointed out that the initial low circulation of MON at 11 billion MON out of 100 billion MON was concerning. According to Hayes, the low circulation of FDV tokens signals that such projects are solely backed up by venture capital. This argument gains traction because, with large portions set aside for insiders, as the token later enters the market after unlocking it could put severe selling pressure on the market.

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Incidents That Back Up Hayes’ Criticism

This volatility, of which Hayes warned investors to be on the lookout for, happened just days after the launch. On 25th November, 2025, Hayes took to social media to state that he “aped” into MON. This had triggered a rapid price surge of nearly 30%.

However, within hours, Hayes reversed his position on MON as he called it “dogshit”, and this fueled a significant price drop. Both incidents strongly displayed the highly volatile nature of MON, which Hayes had pointed out.

What The Market Has To Say About MON

Despite Hayes’s public criticism of MON and his exit from his position, on-chain data had something else to say about MON. While retail traders reacted positively to the negative statement, whale wallets rapidly accumulated MON tokens.

This is suggestive of a divergence in the strategy between large holders and retail investors. It also points to the larger picture that Monad has the potential, and the dip seems like the perfect market entry point for huge players.

Conclusion

Ultimately, the future of Monad will depend on how good it is in real-world applicability. While Monad has some big names as its backers and impressive tech on paper, the concerns raised about its tokenomics are to be taken seriously. For Monad to break free of critics and succeed, it must move beyond being a speculative VC coin.

Monad has tough days ahead as it has to prove its worth through sustained dApp development, user adoption, and demonstrable network performance. For the time being, investors must remain cautious, weighing in on the project’s technical merits and institutional backing against the risks posed by its token structure and the ever-present market volatility.