Crypto World
Dragonfly Launches $650M Fund IV as Co-Founder Reveals the Blueprint Behind Building a Crypto VC Firm
TLDR:
- Dragonfly Capital launched a $650M Fund IV, bringing total assets under management to approximately $4 billion.
- Co-founder Qureshi credits geographic arbitrage between Asia and the US as the firm’s earliest competitive edge.
- Dragonfly avoided trending crypto deals like Terra and Axie, instead backing Ethena and Polymarket at low-interest periods.
- Qureshi argues that non-consensus investments drive the majority of venture returns, making contrarian discipline essential.
Dragonfly Fund IV, a $650 million crypto venture capital fund, has officially launched amid widespread skepticism about the industry.
Dragonfly Capital now manages approximately $4 billion in assets across offices in New York, San Francisco, and Singapore, with around 45 staff members.
Co-founder Haseeb Qureshi recently shared a detailed account of the lessons behind building the firm, offering rare transparency into the mechanics of crypto venture capital.
Starting From Zero: Reputation and Finding a Niche
Dragonfly Fund IV’s story begins long before the launch announcement. Qureshi entered crypto in 2018, just as the ICO bubble collapsed and most participants were exiting the space.
He later partnered with Bo to launch Dragonfly Capital at a time when dominant players like Polychain, Pantera, and a16z controlled the market.
According to Qureshi, first-time fund managers must stake their personal reputation to get started. He wrote that raising from friends, former bosses, and wealthy connections is non-negotiable for a debut fund. Without putting everything on the line, he argued, there is little to no chance of success.
The firm’s early edge was a geographic arbitrage strategy. Qureshi was based in the United States while his partner, Bo operated in Asia.
This east-meets-west positioning helped Dragonfly earn allocations in early rounds, even without leading deals. The approach was demanding, requiring long hours and constant coordination across time zones.
Talent Management and Brand Building as Competitive Advantages
As Dragonfly grew, Qureshi identified talent retention as a major differentiator. He noted that VC firms are notoriously poor at corporate management, including basic practices like mentorship, clear responsibilities, and open communication. Poor management often goes unaddressed because power law returns mask internal dysfunction.
Dragonfly took a different path. The firm invested in giving junior team members stability, voice, and independence.
Qureshi credited this approach for helping retain people who could have joined larger platforms. Over time, those individuals became central to the firm’s performance.
Brand distribution was another focus area. Qureshi stressed that every team member should build a personal audience. He encouraged public writing, social media presence, and individual thought leadership.
Firms that discourage employees from engaging publicly, he wrote, are making a strategic error.
Investment Philosophy: Non-Consensus Bets and Long-Term Discipline
On investment strategy, Qureshi outlined a clear framework. Most returns in venture come from a small number of deals, often just two or three per fund. He pointed out that consensus deals are usually overpriced, leaving little room for outsized returns.
Dragonfly’s biggest wins came from avoiding popular trends. The firm passed on Terra, Axie Infinity, and Yuga Labs during their peaks.
Instead, it backed Ethena shortly after the Terra collapse and invested in Polymarket before the 2024 election cycle drew mainstream attention.
Hsseeb wrote on X: “Every cycle has a narrative that feels irresistible…most of those themes turn out to be a waste of money.” He tied this discipline directly to portfolio construction, warning that trend-following produces a portfolio of “what was popular 18 months ago.”
Qureshi also addressed fundraising timing, noting that the best window to raise capital rarely aligns with the best time to deploy it. Managing that tension, he concluded, is one of the defining skills in venture.
Leading altcoins retraced some of their gains from Wednesday.
Crypto markets dipped slightly on Thursday, with the total market cap dropping by about 2% over the past day to around $2.39 trillion.
Bitcoin (BTC) is trading near $67,000, down 2% over the past day but up 1% for the week, slightly below Wednesday’s peak.
Ethereum (ETH) slipped to $1,992, posting a 3% daily loss. Among other Top 10 assets, Solana (SOL) dropped 3.5%, XRP plunged 5%, and BNB fell 1.5%.
‘Constructive Return of Liquidity’
Analysts at glassnode noted in an X post today that “profit-taking continues to absorb momentum at the $70K threshold,” implying that this is consistent with a thin liquidity regime where even modest realization events are sufficient to suppress recovery attempts.
“Historically, breaks below 1 have persisted for 6+ months before reclaiming it, a recovery that typically signals a constructive return of liquidity to the market,” they added.
Paul Howard, senior director at crypto trading firm Wincent, said in commentary for The Defiant that stronger-than-expected earnings overnight had lifted tech stocks and risk assets more broadly.
He noted that “the short squeeze on Circle was notable, alongside the significant short interest in MSTR and the earnings beat from NVDA,” adding that these moves contributed to Bitcoin’s rally over the past 24 hours.
Howard added that the market is still looking for a clear catalyst that could push cryptocurrencies significantly higher, rather than just supporting them as a hedge trade.
Big Movers and Liquidations
Among the Top 100 assets by market cap, Pippin (PIPPIN) led gains with an 18.4% jump, followed by Internet Computer (ICP), which is up 8.5%.
On the downside, Cosmos Hub (ATOM) fell 7.9%, and Morpho (MORPHO) declined 3.6%.
CoinGlass reports that more than 157,000 traders were liquidated over the past 24 hours for a total of $560 million.
Shorts dominated with around $420 million liquidated, compared with nearly $148 million in long positions.
ETFs and Macro Conditions
Spot Bitcoin ETFs saw inflows of $506 million on Wednesday, Feb. 25, the largest single-day inflow since Jan. 5, bringing total net assets to $87.6 billion. On that same day, spot Ethereum ETFs added $157 million, bringing cumulative net assets to $11.8 billion.
On the macro front, U.S. Treasury yields were mostly flat. The 10-year note slipped slightly to 4.042%, the 30-year bond yield edged down to 4.687%, and the 2-year note ticked higher to 3.473%.
Thursday’s Labor Department report showed initial unemployment claims for the week ended Feb. 21 at 212,000, slightly above the prior week’s revised 208,000 but below the 215,000 forecast, CNBC reported.
On the geopolitical side, Iran’s foreign ministry said today’s nuclear talks in Geneva produced “very constructive” proposals, but didn’t give any details, according to the Associated Press. The U.S. and Iran are negotiating indirectly, with Oman’s foreign minister and the UN’s nuclear watchdog also present.
The AI and data center boom partly driven by Bitcoin miners is increasingly being financed through high-yield bond issuance, underscoring how lenders are pricing both risk and opportunity in the sector.
According to TheEnergyMag’s latest newsletter, companies tied to AI data center development have raised about $33 billion in long-term senior notes over the past 12 months, excluding convertible debt — bonds that can later be converted into equity and typically carry different risk dynamics.
The interest rate spread is notable: While regulated utilities and traditional energy companies generally borrow at 4% to 5%, AI- and crypto-linked issuers pay closer to 7% to 9%.
The average coupon on newly issued US dollar high-yield debt has was close to 7.2% in late 2025, from 8% to 9% in 2023, according to Janus Henderson Investors, citing BofA Global Research, average coupon, as of Nov. 30.
Those at the higher end of the spectrum are largely current or former digital asset mining companies that have pivoted into AI infrastructure, suggesting capital remains comparatively expensive for the group.
TheEnergyMag cited recent raises, including CoreWeave at 9.25% and 9% in May and July 2025, Applied Digital at 9.2% in November, TeraWulf at 7.75% and Cipher Mining at 7.125% and 6.125%.
“The message from lenders is clear,” TheEnergyMag wrote. “Regulated load and contracted generation still get treated as infrastructure. AI and bitcoin, even when attached to long-term offtake agreements, are still treated as growth credit.”
Related: Canaan buys 49% stake in three Texas mining sites for $40M
AI infrastructure boom intensifies
Despite concerns about overspending and potential overcapacity, the AI data center build-out remains one of the most visible trends in the economy, and a major driver of demand on Wall Street.
The scale of that momentum was underscored on Wednesday when chipmaker Nvidia posted blockbuster fourth-quarter results, with profit rising 94% and revenue climbing 73% year-on- year. The chipmaker reported $43 billion in net income and $68.1 billion in revenue.
Meanwhile, Bitcoin mining companies are planning about 30 gigawatts of new power capacity aimed at AI workloads, nearly triple the capacity they currently operate. Much of it remains in development pipelines or early-stage planning, but the industry has made clear that AI infrastructure is a strategic priority.
Related: The real ‘supercycle’ isn’t crypto, it’s AI infrastructure: Analyst
Crypto World
Ethereum’s Fast L1 Vision: Vitalik Buterin Unveils Strawmap Plan for Slots and Finality
TLDR:
-
- Vitalik proposes cutting Ethereum’s slot time from 12 seconds to 2 seconds using a sqrt(2) formula.
- Erasure coding upgrades to Ethereum’s p2p layer will reduce block propagation time across the network.
- The Minimmit finality algorithm targets a reduction from 16 minutes today down to just 8 seconds.
- Ethereum’s quantum-resistant upgrades will roll out in phases, with slot protection arriving first.
- Vitalik proposes cutting Ethereum’s slot time from 12 seconds to 2 seconds using a sqrt(2) formula.
Ethereum’s Fast L1 goal took center stage as Vitalik Buterin published a detailed strawman roadmap outlining how the network plans to evolve its base layer.
The document covers slot time reductions, peer-to-peer network upgrades, and a new finality algorithm. Buterin walks through each goal methodically, explaining how the changes interconnect.
The roadmap presents a phased, component-by-component transformation of Ethereum’s consensus layer toward a faster, simpler, and quantum-resistant design.
Slot Time and Network Architecture at the Core of Fast L1
Ethereum’s Fast L1 goal begins with a structured reduction of slot time across multiple incremental steps. Buterin proposes moving from the current 12 seconds down through 8, 6, 4, 3, and eventually 2 seconds per slot.
Each reduction follows a “sqrt(2) at a time” formula, with steps only taken when safety is confirmed.
Supporting shorter slots requires major improvements at the network layer. Buterin points to ongoing work by @raulvk on an optimized peer-to-peer design using erasure coding.
The new architecture splits each block into pieces so that any subset of them is enough to reconstruct the full block.
In his post, Buterin explained: “split each block into 8 pieces so that with any 4 of them you can reconstruct the full block.” This design cuts 95th percentile block propagation time and makes shorter slots viable without security tradeoffs.
That said, adding protocols like ePBS and FOCIL to the slot structure tightens timing constraints. These changes shrink the safe latency window from one-third of a slot to one-fifth.
To offset this, researchers are exploring a model where only 256 to 1,024 randomly selected attesters sign per slot, eliminating the aggregation phase and shortening slot duration further.
Finality Overhaul and the Shift to Quantum-Resistant Consensus
Beyond slot time, the strawman roadmap targets a complete rework of how Ethereum achieves finality. Today, finality takes roughly 16 minutes on average, calculated across 12-second slots, 32-slot epochs, and 2.5 epochs. Buterin wants to decouple finality from slot time entirely so each can be optimized on its own path.
The target is a one-round-finality algorithm called Minimmit, a variant of the established BFT consensus design. A projected trajectory moves from 16 minutes today through several intermediate stages, eventually reaching as low as 8 seconds with aggressive Minimmit parameters.
These changes will also carry a transition to post-quantum cryptography, including hash-based signatures and a STARK-friendly hash function.
Three hash function options are under active research: adjusting Poseidon2’s round count, returning to Poseidon1, or adopting BLAKE3 as a conventional alternative.
Buterin described the overall transformation as a “ship of Theseus” style process, replacing each part of Ethereum’s consensus layer one at a time.
Notably, the phased approach means slot-level quantum resistance could arrive well ahead of finality-level protection, providing an early security layer if quantum computing advances faster than anticipated.
A Florida man accused of running what is arguably the largest crypto-linked Ponzi scheme involving $328 million has been arrested, federal prosecutors said Wednesday.
Christopher Alexander Delgado, 34, of Apopka, Florida, was taken into custody on a criminal complaint charging him with wire fraud and money laundering, according to the U.S. Attorney’s Office for the Middle District of Florida. If convicted on all counts, he faces up to 30 years in federal prison. A criminal complaint contains allegations, and Delgado is presumed innocent unless and until proven guilty.
According to a TRM Labs global report, pyramid and Ponzi schemes received approximately $6.1 billion in victim funds globally in 2025, a 49% increase from the previous year. The most recent case prior to Goliath Ventures involves Ramil Ventura Palafox, the CEO of Praetorian Group International (PGI), who was sentenced to 20 years for misleading more than 90,000 investors and draining over $62.7 million in funds.
Prosecutors allege Delgado served as president and CEO of Goliath Ventures, formerly known as Gen-Z Venture Firm, from January 2023 through January 2026. During that period, authorities claim he raised at least $328 million from investors by promising monthly returns generated through cryptocurrency “liquidity pools,” sometimes described as “guaranteed” or “low risk,” with contracts promising monthly returns of roughly 3% to 8%.
Instead of investing the funds as represented, Delgado allegedly operated Goliath as a Ponzi scheme, using money from new investors to pay purported returns to earlier backers and to meet withdrawal requests.
The complaint alleges that the firm’s claims about deploying capital into crypto liquidity pools were false. According to court filings, investigators said blockchain analysis showed only about $1.5 million was sent to Uniswap, while the “vast majority” of investor funds were not placed into liquidity pools.
To build credibility and attract victims, prosecutors say Delgado relied on personal referrals, polished marketing materials, luxury events, charitable sponsorships and periodic payments marketed as returns. The court documents also revealed investors were shown account updates via an online portal that displayed consistent gains, but the reported “returns” were allegedly fabricated and adjusted to match promised rates.
The case is being investigated by IRS Criminal Investigation and Homeland Security Investigations and is being prosecuted by the U.S. Attorney’s Office in Orlando. Law enforcement officials are asking potential victims to come forward as the investigation continues.
Ethereum co-founder Vitalik Buterin outlined a roadmap on Thursday to protect the blockchain from the long-term risks posed by quantum computers — a move that comes shortly after the Ethereum Foundation established a dedicated post-quantum research team to study the issue.
Although practical quantum computers capable of breaking modern cryptography do not yet exist, they could one day crack the digital signatures and cryptographic systems that secure Ethereum.
In a post on X, Buterin identified four key areas of vulnerability: validator signatures used in consensus, Ethereum’s data availability system, everyday wallet signatures, and certain zero-knowledge proofs used by applications and layer-2 networks.
A big part of the plan involves changing how Ethereum’s validators sign and confirm blocks. Right now, they use a type of digital signature called BLS. In a world with powerful quantum computers, those signatures could eventually be broken. Buterin suggests switching to “hash-based” signatures, which are considered much safer against quantum attacks.
Another area that would need updating is how Ethereum checks and stores large batches of transaction data. The system it uses today relies on a cryptographic tool called KZG commitments. Replacing that with a quantum-safe alternative is possible, Buterin said, but it would require significant behind-the-scenes engineering work and could make some parts of the system more complicated.
For everyday users, the proposed fix revolves around a planned upgrade called EIP-8141. In simple terms, this upgrade would make Ethereum wallets more flexible. Today, most wallets rely on one standard type of digital signature to approve transactions. EIP-8141 would allow accounts to switch to different types of signatures in the future — including ones designed to be safe against quantum computers.
There’s a similar issue with zero-knowledge proofs, a type of advanced cryptography used by privacy tools and many layer-2 scaling networks. Quantum-safe versions of these proofs are currently far more expensive to verify on Ethereum.
Buterin pointed to a longer-term solution built into EIP-8141 known as “validation frames.” These would allow the network to bundle together many signatures and proofs and replace them with a single combined proof. Instead of checking each one individually on the blockchain, Ethereum would only need to verify one compressed proof, helping keep costs down.
Read more: Quantum threat gets real: Ethereum Foundation prioritizes security with leanVM and PQ signatures
“The growth in Cardano’s technology has been amazing, and the best is yet to come,” one X user stroke back.
Cardano’s native token reached an all-time high of almost $3.10 in late 2021. Despite sporadic runs in the following years, it has not managed to break its record and is currently worth around $0.29, representing a staggering 90% decline from the historic peak.
The steep decline has left many investors frustrated, including popular content creator Jake Gagain, who described ADA as one of his worst investments since entering the crypto market.
Wasting “Such a Great Opportunity?’
Besides expressing regret over his investment, Gagain emphasized that Cardano still has a strong community and huge potential. He said he was disappointed to see the team waste “such a great opportunity” and asked his followers whether they still hold ADA.
His post on X sparked a heated debate, with many users sharing their experiences with the token. One person agreed with Gagain, arguing that Cardano’s community is among the most dedicated, “but the execution and speed have just been painful to watch for years now.”
The discontent was echoed by numerous others, some of whom pledged to step away from ADA and all altcoins for good and to shift their capital solely to Bitcoin (BTC) from now on.
Others differentiated from this thesis. X user Michael Lesser claimed that Gagain doesn’t understand the definition of a bear market, adding that his timing is bad.
“If you have an investment thesis and patience, ‘paper losses’ are just that. The growth in Cardano’s technology has been amazing, and the best is yet to come,” he said.
Many investors who remain optimistic said they would keep accumulating ADA, convinced that the token will set a new all-time high sooner or later. Some even flashed the “diamond hands” emoji to signal their determination not to sell under any circumstances.
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Meanwhile, certain X users attacked Gagain for promoting meme coins, which performed much worse than ADA. In the summer of 2024, for instance, he claimed that NEIRO could be the next “billion-plus dollar project” on the Ethereum blockchain. It is important to note that the asset’s market cap briefly surged above $1 billion in late 2024, but since then, it has been in a sharp decline, and its current capitalization stands at less than $30 million.
What’s Next for ADA?
Cardano’s native token has been among the biggest beneficiaries of the recent market resurgence, with its price rallying by 9% on a weekly scale. The recent whale activity suggests a further jump might be on the way.
As CryptoPotato reported, large investors have scooped up almost 820 million coins over the past six months, thus increasing their total holdings to 25.36 billion tokens, or nearly 70% of ADA’s circulating supply.
Big purchases of this type leave fewer tokens on the open market, which could result in a surging price (should demand remain constant or rise). Whales’ buying also sends a strong signal that they believe in the asset’s long-term future, and that confidence could draw smaller players into the ecosystem.
Some analysts observed ADA’s recent comeback and envisioned further gains if key levels are reclaimed. X user Nehal argued that breaking and holding above $0.30 could lead to a pump to $0.32 and $0.34.
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US-based asset manager REX Shares has launched an exchange-traded fund that bundles leveraged covered-call strategies tied to nine individual stocks, including crypto-linked names Coinbase and Strategy, into a single income-focused product trading under the ticker GIF.
According to Thursday’s announcement, the fund holds equal-weighted positions in REX’s existing single-stock Growth & Income ETFs, each of which targets about 1.25x exposure to its underlying equity while writing covered calls on a portion of the portfolio to generate option premium income.
GIF trades on Cboe Global Markets and each underlying ETF seeks to distribute income on a weekly basis, with payouts largely derived from covered call premiums.
Covered call premiums are the upfront payments a fund collects for selling options on stocks it already owns, generating income in exchange for capping some of the shares’ upside potential.
REX Shares said the ETF holds equal-weighted exposure to nine REX funds tied to Nvidia (NVII), Tesla (TSII), Strategy (MSII), Coinbase (COII), Robinhood (HOII), Palantir (PLTI), CoreWeave (CWII), Eli Lilly (LLII) and Walmart (WMTI), spanning crypto-linked equities, technology, AI, healthcare and retail sectors.
Related: Michael Saylor says quantum threat to Bitcoin is more than 10 years away
21Shares lists STRC ETP as companies add Strategy preferred shares to treasuries
The launch comes amid a week of new allocations tied to Strategy-linked securities.
On Wednesday, 21Shares introduced an exchange-traded product (ETP) giving European investors exposure to STRC, Strategy’s variable-rate perpetual preferred stock. The 21Shares Strategy Yield ETP began trading on Euronext Amsterdam under the ticker STRC NA on Thursday.
Also on Wednesday, Strategy said Prevalon Energy, an energy infrastructure company, and Anchorage Digital, a crypto-focused digital asset bank, had allocated portions of their corporate treasuries to STRC, though they did not disclose the size of their positions.
Strategy describes STRC as a digital credit instrument with an 11.25% annual dividend, part of its broader effort to issue fixed-income securities tied to its Bitcoin (BTC) holdings.
Since adopting its Bitcoin treasury strategy in August 2020, Strategy has become the largest corporate holder of Bitcoin, reporting 717,722 BTC, or about 3.4% of the fixed 21 million supply.
Despite demand for Strategy-linked securities, the company’s shares have fallen alongside Bitcoin’s price. The stock is down more than 60% over the past six months and about 50% over the past year, according to Yahoo Finance data.
Strategy has also emerged as the most heavily shorted large-cap US stock on Goldman Sachs’ latest ranking, based on short interest relative to market value.
Magazine: Bitcoin’s ‘biggest bull catalyst’ would be Saylor’s liquidation: Santiment founder
Crypto investigator ZachXBT detailed the results of a recent investigation today that show how a group of Axiom employees allegedly abused weak internal controls to spy on sensitive user data and carry out insider trading using wallet activity.
The previously teased exposé shows a group of Axiom employees and moderators discussing how they used the company’s dashboard to pull up “anything” on its users.
They apparently mapped out key opinion leaders (KOLs) within the crypto industry and targeted wallet details made available by one of the company’s senior business development professionals, Broox Bauer.
The group was recorded strategizing on how to insider trade and showed Bauer describing the ways he can pull up Axiom user data by tracking a user’s reference code, wallet, or user ID.
Bauer lays out ground rules to his group during the call, telling them not to send any Discord messages alluding to what they’re doing, and promising that if they send him specific identifying information, he’ll then get them “what they need.”
Read more: Here’s how insiders dump blockchain game tokens using Sybil attacks
Bauer also details how he’s slowly increased the number of wallets he’s probing from an initial 10 to 20 “so it does not look that suspicious.” He also promises one of his members a profit of $200,000 thanks to his access to Axiom’s data.
ZachXBT’s findings also revealed how the group targeted “a trader with a poor reputation for using his followers on X and Telegram as exit liquidity.”
Indeed, one member in the call says, “Time to farm the farmers.”
Axiom shocked by ZachXBT’s findings
In response to ZachXBT’s investigation, Axiom said it’s “shocked and disappointed to hear that someone on our team abused internal customer support tools to look up user wallets.”
“We have removed access to these tools and will continue to investigate and hold the offending parties responsible,” the crypto exchange said, adding, “This does not represent us as a team, we have always tried to put the user first. We’ll share updates on our twitter as we learn more.”
ZachXBT hinted that the insider trading evidence might be fit for a legal case against the alleged group in the Southern District of New York.
He said, “Whether or not criminal charges are filed, I hope the Axiom co-founders further investigate the abuse and consider taking legal action against the employees involved.”
ZachXBT’s Axiom teaser caused $38 million hype train
On February 23, ZachXBT announced that he’d undertaken a “major investigation” into one of “crypto’s most profitable businesses where multiple employees abused internal data to insider trade over a prolonged period of time.”
This teaser said all would be revealed today, sending Crypto Twitter into speculation overdrive as users tried to guess which firm he was talking about. The post alone has over 11 million views.
It soon caught Polymarket’s attention, and it launched a prediction market based on which firm would be outed.
This market attracted $38 million in trading volume, with Polymarket also taking bets on which day the investigation would be released and at what specific time.
Read more: Israeli soldier allegedly used military secrets to gamble on Polymarket
Ironically, some in crypto warned users to avoid this particular market, as the potential for somebody related to the investigation to use insider information to trade on the market is high.
ZachXBT also noted that after the teaser was dropped, “prediction market bros started raiding my DMs for insider info.” He also suggested that the number of interviewees means a “leak is probably inevitable.”
One Axiom employee was left red-faced when they confidently denounced Axiom’s potential to be in ZachXBT’s exposé. They have since apologised for their wayward takes.
“Devin” has also subsequently claimed that they’d been trading in this prediction market about the firm where they work and lost $20,000 as a result.
The potential for insider trading is a frequent criticism of prediction markets. Indeed, Polymarket rival Kalshi fined Mr. Beast’s editor, Artem Kaptur, for insider trading ahead of various markets related to his YouTube channel.
Kalshi also fined the former California Governor Kyle Langford for using non-public information to insider trade in his own elections.
An investigation was also opened by Israel against two military personnel who were accused of using military secrets to insider trade markets involving missile strikes against Iran.
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Circle (CRCL), issuer of the USDC stablecoin, continues to surge, now 45% higher in less than two sessions following its Wednesday fourth quarter earnings report.
The move snapped what had been a brutal 80% drawdown from record highs hit last year.
While the company delivered strong growth in USDC supply, the stock’s outsized reaction was driven more by crowded short bets heading into the print than by strong financials, analysts suggested.
“The magnitude of the move was not driven purely by the headline numbers. The real catalyst was positioning,” said Markus Thielen, founder of 10x Research.
Hedge funds had built sizable bearish exposure into the report, according to his data. That setup pointed to a “high-probability short squeeze rather than a fundamental re-rating,” Thielen added.
He estimated that hedge funds had lost roughly $500 million in a single day on shorts as shares squeezed higher.
Tough business
While Circle’s report produced positive headline numbers, digging deeper into the data shows that the profitability of the business slipped despite growing stablecoin demand.
On the fundamentals, Circle’s flagship USDC stablecoin grew to $75.3 billion in circulation, up 72% year over year and outpacing rival Tether’s USDT growth, Harvey Li, founder of Tokenization Insight, noted in a report.
Revenue from reserve income — primarily U.S. government debt backing USDC — rose 58% to $2.64 billion as benchmark interest rates compressed over the past year. But distribution costs climbed even faster, up 66% to $1.66 billion, underscoring the expense of incentivizing partners and platforms to expand adoption.
Despite surging circulation, Circle swung from a $156 million net profit in 2024 to a $70 million loss, Li pointed out.
“Stablecoin may be scaling; stablecoin issuance is a tough business,” Li said.
Beating expectations
Still, Circle topped analyst forecasts.
Japanese investment bank Mizuho raised its price target on Circle to $90 from $77 after the stronger-than-expected fourth quarter, citing a boost from prediction markets and growing optimism around “agentic commerce,” in which autonomous AI agents transact using Circle’s USDC stablecoin.
The firm reiterated its neutral rating on the stock, warning that lower interest rates could still weigh on reserve income.
Analysts Dan Dolev and Alexander Jenkins said Circle’s results topped expectations on both revenue and profit, easing investor concerns after a period of pessimism. Management highlighted prediction and betting platforms, particularly Polymarket, as meaningful drivers of recent USDC growth, pointing to their high-frequency transaction flows and near-term utility.
The analysts noted that company executives also underscored USDC’s emerging role in agentic commerce, describing the stablecoin as a potential default currency for AI agents transacting across digital marketplaces. A growing number of products are being built on USDC and connected to Circle’s network, with trading and prediction platforms serving as prominent examples of high-velocity use cases.
The bank now forecasts average USDC in circulation of roughly 123 million in 2027, modeling reserve income of about $3.7 billion and EBITDA of $916 million that year, assuming rate cuts in line with consensus expectations. Applying a 24x EBITDA multiple, a premium to peers such as Visa (V), Mastercard (MA), Coinbase (COIN) and Robinhood (HOOD), the analysts arrived at their new $90 price target.
With just days left in February, crypto whales are quietly repositioning. The broader market remains uncertain, but on-chain data tells a different story. Large holders are selectively adding exposure across three tokens — one seeking direction, one seeking a breakout, and one targeting greater upside.
As March approaches, the big holders appear to be making their move early.
Uniswap (UNI)
Uniswap is among the more interesting names showing crypto whale activity heading into March. Despite a broader market pullback, UNI is up nearly 15.5% over the past 24 hours, briefly spiking to $4.29 before pulling back sharply.
Yet crypto whales are not flinching. On-chain data shows large holders increased their UNI holdings from 639.06 million to 640 million tokens. And they did all of that on February 26 alone. At the current price, that sudden accumulation is worth roughly $1 million over a few hours, reflecting quiet conviction even as the price corrected from its intraday high.
The chart context explains why. UNI has been consolidating inside a developing symmetrical triangle, with lower highs being met by higher lows as both trendlines converge. The past two attempts to break above the upper resistance were rejected hard, with sellers stepping in precisely at the triangle boundary. The large wick from today’s session is a direct reflection of that dynamic — momentum pushing up, supply pushing back.
However, smart money positioning remains aggressive, as the Smart Money Index is still way above the signal line. This keeps the possibility of a breakout alive if broader market conditions improve. A confirmed 12-hour close above $4.21 would validate the breakout and give UNI a possible bullish direction. That would open upside toward $4.88 and potentially $5.95 if DeFi rotation picks up meaningfully through March.
On the downside, $3.81 is the key support. A break there risks pushing UNI toward the lower triangle boundary. However, buyers have consistently defended that zone since early February, suggesting the symmetrical structure remains intact and continues narrowing. However, if the broader market sell-off begins, traders need to keep a close eye on whale and smart money positioning.
Bitcoin Cash (BCH)
Bitcoin Cash is another name where whale accumulation has turned suddenly aggressive. BCH is up just 1.5% in the past 24 hours, underperforming the broader market. But zoom out, and Bitcoin Cash is up nearly 70% year-on-year. That is a standout number. Most major crypto names cannot say the same.
That long-term strength appears to be driving fresh conviction. The largest BCH holder cohort, wallets holding between 100,000 and 1,000,000 coins, increased their stash from 4.3 million to 4.4 million today, almost $50 million. The move was rapid and decisive. Notably, these whales were steadily reducing holdings until February 25. Then the shoulder of an inverse head-and-shoulders pattern formed.
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Price began moving on February 24. By February 26, accumulation kicked in sharply. The timing is deliberate. Whales waited for the pattern to develop before committing. That is disciplined positioning, not reactive buying. On the 8-hour chart, BCH has rallied roughly 10% since February 24, only to pull back.
It is now approaching the neckline of that inverse head-and-shoulders formation. A confirmed break above $598 would signal a breach of the neckline, which BCH could attempt in March. Based on pattern projection, that opens a path toward $777. However, it would first need to push past $570, a strong technical resistance, before that.
Given BCH’s year-on-year track record, both the targets, first the neckline at 19% and then the target, are not far-fetched. However, the setup has clear invalidation levels. Failure to reclaim $508 would be an early warning sign. A drop below $470 weakens the pattern meaningfully. A close under $423 invalidates the structure entirely, and the whale thesis unravels with it.
Chainlink (LINK)
Chainlink rounds out the three tokens where crypto whale accumulation has turned decisive heading into March. LINK saw continuous whale selling through February 25. That changed on February 26. Large holders increased their stash from 591.96 million to 592.33 million tokens. That is an addition of 370,000 LINK. At the current price, that accumulation is worth roughly $3.5 million — a sudden shift in positioning.
The trigger is clear. On the 12-hour chart, Chainlink broke out of an inverse head and shoulders pattern yesterday, as predicted by BeInCrypto Analysts. This is not anticipatory buying. Whales moved after the breakout was confirmed, adding on evidence rather than speculation.
Since the breakout, LINK has met resistance at $9.62 and pulled back, possibly due to profit-taking. However, it is holding firmly near $9.28, a strong support zone. That level needs to hold for the bullish structure to remain intact.
There is another layer of strength here. The Chaikin Money Flow, or CMF, crossed above the zero line on February 20. That cross preceded the breakout, signaling institutional money flowing into LINK before the price moved. CMF currently sits at 0.13.
A push toward 0.18 would confirm deepening institutional participation and give LINK the momentum needed for the next leg.
If buying resumes and sentiment holds, a move above $9.62 followed by $10.05 opens the path toward the realized projection target of $11.70.
Invalidation is straightforward. A correction toward $8.51 is the first warning. A close below $8.04 weakens the structure considerably and puts the entire bullish thesis at risk.
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