Compiled & translated by: Foresight News
Guest: based16z
In October 2026, threadguy's podcast interviewed based16z, a highly influential crypto trader on Twitter. At the end of 2023, when Hyperliquid was still unknown, he judged from a single phone call with founder Jeff Yan that this was a big opportunity, and then spent an entire year farming trading volume on Hyperliquid for the airdrop, ultimately receiving one of the most profitable airdrops in crypto history and completing his personal accumulation of initial capital.
This hour-plus conversation not only provides a complete retrospective of the causes and process behind Hyperliquid's legendary airdrop, but also covers his trading style, failed cases such as S&P 500 put options, his existential confusion after achieving financial freedom, and his advice for the current market and young people.
Key Views
"Trading and investing should focus on those occasional high-quality opportunities, rather than chasing a bunch of scattered low-value trades. Hyperliquid is the best trade I've ever made, but I hope there are more to come."
"If the first attempt doesn't succeed, don't try again. In trading, it's not 'if you fail, try again' — stop and think about why it's wrong."
"Always keep 70% of the position in short-term Treasury bills, and only use the remaining 30% for big bets. Even if that 30% is completely lost, I still have 70% to start over."
"I actively 'brainwash' myself, repeating the long narrative to myself, so that I can hold the position without running early. Posting tweets serves the same purpose."
"Freedom is not a number. You will never earn enough to reach that number; that treadmill has no finish line."
The following is a compiled transcript of the podcast conversation (content has been abridged):
The first call in 2023: I told my friends Hyperliquid was awesome
Host: The first time I spoke with you on the phone was in November or December 2023, when I was living in Los Angeles. I had just come across your tweets, found you interesting, and pulled Frank in for a video call. I asked you how the market was at the time, and you didn't have much of a view, but you said one thing — "This new Hyperliquid is pretty awesome, you should go farm it." I asked you what Hyperliquid was, and you said, "I don't know either, seems to be a perpetual contract exchange, go research it yourself." It later turned out to be one of the most profitable airdrops ever.
Guest: Right, I think that was the best trade I've ever made. I actually don't have many good ideas and am always improving. Trading and investing should focus on those occasional high-quality opportunities, rather than chasing a bunch of scattered low-value trades. Hyperliquid is definitely my biggest one so far, but I hope there are more to come.
Host: How did you discover this opportunity? Did you trade Rollbit before?
Guest: Yes, I was doing Rollbit at the time (note: Rollbit is a crypto-native online gambling platform). I was already trading crypto in early 2023. I made money in 2021, paused for a year in 2022 to finish university, then worked as a crypto VC analyst at a large fund while also trading on-chain myself. Rollbit was an opportunity I discovered; at the time I thought it was a cool new slot machine, everyone loves to gamble, the token was cheap, and it had a revenue story. And you had to buy it on Solana; I had traded Solana in 2021, so I was very familiar with fees and such. That was my only big result in 2023.
Then I started trying to trade perpetual contracts, although that's usually a bad idea. I wanted to build some large positions on-chain, so I went to dYdX, Vertex, and other messy platforms. Leverage was low at the time, and even buying 100 BTC would collapse those order books. If you wanted to go long 100 BTC, you had to split it into four parts — a quarter on dYdX, a quarter on Vertex, another quarter elsewhere, while watching three screens at the same time. I was trading with a US identity at the time, and everyone told me, "Bro, don't bother, just open a Papua New Guinea KYC account," but I insisted on taking the hard road.
Jeff Yan is not an ordinary crypto founder
Host: So how did Hyperliquid enter your field of view?
Guest: I was looking for venture projects while also looking for bets on-chain. When Hyperliquid first came out, I was looking for new venture projects and also wanted to gamble on-chain — these two matched up perfectly. After trying it, I immediately contacted Jeff and said, "Wow, this thing is great, could there be something here?"
Then I met Jeff. My feeling at the time was, this is a founder. This person is different. You can immediately feel that he is the kind of person with true vision. I went back and looked up his previous podcasts about markets; he is on a completely different level from anyone I've seen in crypto. I haven't met Vitalik yet, but this was the first truly top-tier early-stage person I had met.
It was already the end of 2023, and I told people at our fund, "We should buy at a $1 billion valuation before it's even making money; this will be a big trade." They said, "Sure, we agree, we'll send him a term sheet." But Jeff said, "I like you guys, but no, I need a Bitcoin-style native genesis." I thought, okay, then for the next year I'll make airdrop farming my full-time job.
Looking back, this was actually to a large extent a bet on the founder. Of course, everyone knows all this now. I still really like this team and product. Even now, I can't really articulate any differentiated view on Hyperliquid. It has matured now, but it is still one of the cooler things being built in crypto.
Computer broke 5 days before the airdrop
Host: When the airdrop finally came out, how did you handle it? You had such strong conviction in this thing; I don't think I've ever seen you hold an idea for a whole year. How did you execute?
Guest: Here's the funniest thing. The private keys to all my airdrop-farming wallets were stored on an old MacBook, and it had always been fine. Then a week before the airdrop came out, the computer suddenly died, wouldn't turn on, completely dead. And I hadn't written down a mnemonic backup — some people may know about this.
At that point there were only 5 days left before the airdrop. I first went to a friend Flood's house and used his computer to set up a legitimate professional VPN to prepare to claim the tokens; the computer was still working then. Two days later I tried to open it and got a black screen. I started calling the founder of Trade.xyz, Shoku, and everyone I knew with high-level connections in the tech world. I went to the Apple Store, went to authorized repair shops, and they said, "This would have to be sent to an IDF-level laboratory to be repaired." I knew what that meant. The money I had made in crypto each year was enough for me to live on, and I had a job, but I knew very clearly that this airdrop would be a once-in-a-lifetime opportunity. When all my assets might be lost because of a broken computer, I really panicked.
Then suddenly, my former roommate contacted me; he had kept the old laptop from my first apartment in New York's East Village. I said, "Bro, do you still have that computer? I really need it now." He said, "Yes, but can you come get it in a few weeks? I'm with my girlfriend right now." I said, "No, I want to go today, can I be at your place within two hours?"
I rushed to his apartment, and that old laptop really did have the old keys stored in it. I was saved. I didn't make it on the first day of the airdrop, and then over the next five days, the price went from $3 all the way to $10, and I still hadn't even received the tokens. So I basically missed the first three days of gains for nothing. By the time I finally logged into the account, this already accounted for 90% of my portfolio, with the price at $10. The first thing I did was add to the position.
I messaged Shoku: "Does this idea work?" He said, "Probably not; you should sell part of your HYPE, buy an S&P 500 index fund with the money, lock in the gains, and you're financially free." In hindsight this advice was right, and I did sell a portion at that level. I later sold the rest roughly in the $30-40 range; looking back now that may have been a mistake, mainly because I lacked patience.
What is an asset always worth holding?
Guest: This is what I need to learn next: what is an asset always worth holding? How can you truly capture tail returns? How do you psychologically detach yourself from a position?I think one of the biggest challenges is, especially when you're holding a large position — I usually either go extremely big or not at all — it takes up mental space. If you have other things to do besides trading and investing, it's like a heavy burden. So how to learn to let go, how to accept "this is a permanent capital story" or "this is an asset I'm allocating to over the ultra-long term" — that's something I haven't learned yet.
Host: On the topic of "life-changing." I once heard a trader talk about an experience of his — that money really was life-changing. He said that after selling, there were 24 to 48 hours of the greatest euphoria you could ever imagine, and then basically it was back to normal — "Alright, time to get to work." Even after life-changing money landed in your account, how did you feel emotionally? Did it change your view of trading, of the world?
Guest: It's funny. I grew up in a relatively wealthy family, my parents were upper-middle class, but my mom joined a religious group — they said "you have to meditate, money is actually the root of all evil, you should be content with what you have," and all sorts of Buddhist concepts. I grew up in that environment.
At the same time I was a super ambitious kid. At first I charged toward sports, then when sports didn't work out I did math competitions, got into a good university. After getting into a good university, I found myself surrounded by the richest people in the world — mooching free NBA courtside tickets everywhere, and I thought "there must be something to this." So this is a somewhat unnaturally evolved sense of identity and values. I started crypto trading in 2020 and have been going along this path ever since.
In 2022 I was still dating a girl whose dad was a billionaire. She said "bro, what are you doing on your computer all day, trying to make $10 million? What's that money worth? Come spend time with me." And then on the other side, I could get into the circle of full-time traders, all coming from all sorts of messy places. So winning money is in a sense bittersweet — "congratulations, you spent three years of your life, 16 hours a day in front of a computer, and finally leveled up from level zero to level one. And then what?"
For a while I thought "alright I'm retired, for the next three months I'll just party, do a bunch of stupid things, hang out with low-energy people, do things that are bad for me and not happy" — and for the first few months I really did that. It was also an internal check — you see, even now, I still haven't achieved anything on my own. All my money right now comes entirely from Jeff's airdrop. So I thought, "wow, I've been on the road all this time, and now where am I going? Is this it?" There really were a lot of complicated emotions.
To sum up: of course I feel super lucky, super grateful, feel that getting to this point is truly heaven's blessing. But after drifting for a few months and living a semi-retired life, I thought "no, I have to keep going, what's next? I have to get back into a high-level game."
Either don't bet, or bet big
Host: You said your positions are either extremely big or you don't do it at all — can you explain your trading style? What types of trades do you do best?
Guest: Can split into short-term and long-term. When I started trading in 2020 I only had $5,000, earned from tutoring and playing online poker. I entered crypto originally wanting to work at Andreessen Horowitz — in my sophomore year I was writing the Cairo language, and even won a hackathon of theirs for a ZK programming language. At that time I was very "crypto fundamentalist," thinking "maybe this could be an interesting career direction, at least it looks good on a resume." I was a typical "resume-padding" kid back then.
The first NFT I minted was called Blitmaps. I got really addicted, minting was so much fun. I was in my college dorm with friends, and then completely hooked. That thing started at 0.02 ETH each, then went to 0.1, then later 30 each. I thought "wow, I made $200,000" — for the people around me at the time, that was money they'd never seen in their lives.
So I fell down the rabbit hole. What I was good at back then was, in Discord I could spot from our perspective which things would go up. Terraforms was a big project for me. I also thought the Solana ecosystem was an opportunity at the time, so I made a lot early on — thanks to Ansem, whom I met in a Miami strip club in 2021, which is quite an anecdote. At that time a very important yardstick in crypto was "early" — I think Rollbit and Hyperliquid are the same, just exploring new things, and then having an initial filter: "Am I early? Is this thing real?"
Crypto has matured a lot now. Over the past year or so I've found that what I'm good at is finding those asymmetric opportunities — I can build conviction, then bet big, make some aggressive options bets that others don't dare to make. This year all my profit came from two trades: one was on the best headline news day, going heavy on weekly Bitcoin call options. As long as the options you buy have a short enough duration, notional leverage can reach 300x. So once you get it right, the payoff is enormous. That's what they call "market feel," I guess.
The other was Robinhood. If you can get extremely high leverage and size the position heavily, you can make a lot of money, just like a VC bet, as long as you're willing to lose the entire premium. Right now I'm looking for these kinds of opportunities that I can see, and then making a killing.
Lessons from failure: S&P 500 puts
Host: Where have you lost the most? What playbook will you never touch again?
Guest: Perpetual contracts are such a trap. Because I was farming Hyperliquid trading volume, I had to trade all day. Hyperliquid really is a good product — it makes you want to keep clicking. But I actually have almost no edge, maybe even negative edge, in ultra-short timeframe price action. Yet I just have that addiction, wanting to keep 40x leverage all the time — all bad habits cultivated by farming volume. Looking back at my historical P&L, the biggest losses absolutely came from perpetual contracts.
Then there was buying too many S&P 500 puts last year. I kept hoping something that was wrong would work out. The lesson learned here is — if the first attempt doesn't succeed, don't try again. Trading isn't "fail and try again," stop and think about why it's wrong.
Host: Why do you think the S&P 500 puts were wrong? I feel like it should have worked.
Guest: The S&P 500 market, even for professionals it's hard to find an edge in it. So first of all, trying to find an edge in it is itself a bit stupid. Second, the dollar isn't going to rise in purchasing power or in any sense. As Good Alexander said — "wanting to short the stock market is equivalent to wanting to hold more dollars" — that's essentially a stupid proposition. But I also can't say who was supporting the S&P 500 during that period. Obviously they were right, because it's higher now.
Host: Your second famous trade, I want to talk about it. Snapchat, right?
Guest: Yeah, so funny. When this account started getting popular, it was all meme coin trading, meme at best, garbage at worst. The background of the Snapchat trade was, a friend of mine is a very capable CEO, and we both saw the inflection point in subscription revenue — after being hammered for so many years, it was finally about to turn free-cash-flow positive. And nobody cared about this thing anymore.
Then I also saw my younger brother (much younger than me) and a bunch of younger people all using Snapchat. All these factors came together. I still think it has a shot even now. But what I ignored at the time was — hey, Evan isn't running things anymore, you're betting on a bad team. And based on the S&P 500 inclusion rules, it was impossible for it to be included in the index. So I wrote a line — "why are you betting on this? Evan doesn't even want to pump it, because even if he did he couldn't get into the S&P, there's no liquidity premium."So I missed a bunch of things at the time — I thought I was a genius who'd found a perfect business turnaround case where all the factors resonated. But you missed the big thing right under your nose — this was one of the worst management teams in history, and they had no incentive to pump the stock, and they kept issuing shares. So you not only need this thing to actually improve, you need it to improve hard enough to overcome all the big holes you'd forgotten about. But getting publicly roasted is also kind of fun — I don't mind being publicly wrong. And honestly, my historical win rate has always been around 25-30% — because the asymmetry in this industry is so huge that I'm almost always wrong.
Host: So how much risk would you take on a high-conviction trade? Like the Snapchat one.
Guest: The Snapchat one was way too heavy — I put on roughly 10% of the portfolio, because I also bought the convertible bonds. That's really not something I should have done. Over the last eight months I've moved 70% of my liquid assets into an account I can't touch. Because back when I was doing 1.5x notional leverage on things like Snap, the position was still small and I didn't care — I've been through 60% drawdowns. I've never blown up, but with small positions I did have 50-60% portfolio drawdowns. Especially when I was farming HYPE, doing perps all day, I just got slowly ground down by fees. So I've now learned to put part of my money somewhere unrelated to trading, so that the money left in my trading account — even if I bet 40% of it — won't affect my livelihood.
Sydney Sweeney: A Perfect "Cathedral Trade"
Host: You wrote an article called Mega Church, and I've quoted it countless times. You mentioned the Hollywood actress Sydney Sweeney American Eagle trade — can you talk about it? That's my favorite trade, even though I wasn't in it (note: American Eagle is a mass-market casual apparel brand in the US).
Guest: Let me first talk about the Mega Church concept. A lot of times when I have conviction, it's not just because of one headline. Like the Bitcoin trade I did before — it wasn't just because Bessent (the US Treasury Secretary) said those things. There was also the upcoming Trump rally, and the smartest options traders I follow were all tweeting "an upside breakout is coming, call sellers are already positioned on the wrong side." All this background information suddenly converged into a flash of insight — "I'm going heavy." That's the feeling I want when I'm trying to make money.
That's exactly how the American Eagle trade was. I'd been following Sleepy Soul on Twitter — he has a lot of great insights on consumer stocks. He'd been tweeting for three months that American Eagle was a turnaround story, trading at a cheap valuation, the business was improving, telling me to keep an eye on it. So it stayed in the back of my mind. Then the Sydney Sweeney news came out, and I saw Waggy Capital tweet "this is going to be a huge positive for American Eagle." Everything instantly connected in my head — "Sydney Sweeney is the hottest person in the world right now, this ad is going to go viral, and according to my expert network, the stock is already super cheap."
So I bought 80% of my position in American Eagle on the spot, a position so big that I myself could move the stock price. Because I thought — what's the downside? It's a real consumer stock, it's not going to zero tomorrow. My friend says it's good, and the upside is huge. That's real asymmetry.
But what I learned later is that a smaller position is actually better. Because my position was so big, I stared at the intraday chart all day, and I ended up taking profits on most of the position after it was up 40%. Even though it was a great return for the portfolio, the stock went on to triple. I didn't capture the return I should have, because the position was too big. From a Kelly criterion perspective, the downside/upside ratio might have been right, but from your own emotional perspective — "will a position this big distort the way I manage it?"
Narratives and Memes Are the New Market
Host: How much do you think Twitter affects your trading performance?
Guest: Twitter is weird. When I started my account in 2023 I only had 2,000 followers, I was just a community member arguing in other people's comment sections all day. That was the more optimistic side of crypto, like I remember from the NFT era — even though I have a somewhat nihilistic view now, everyone rallying around the same asset, holding it together was cool.
I think Ansem is the best in the world at "discovering people" — he found me when I only had 3,000 followers and said "you've got some good ideas." He can instantly spot accounts far better than mine. He has that VC-like ability on Twitter.
There are two ways to get ideas from smart people: one is seeing what they post on Twitter, the other is talking to them directly, in group chats, on calls. The two are equivalent. What you get from Twitter is probably that overall sense of grasp — or the meme gene, which you can internalize.
What's interesting is that posting tweets itself can also feed back into the market. I think analyst Good Alexander's tweet really triggered a small panic in Nvidia, and research firm Citrine contributed part of it too. I did the same thing myself on the "DeepSeek trade" (note: in January 2025, DeepSeek released its new-generation large model DeepSeek-R1, causing a sharp selloff in US AI tech stocks). That was one of my best trades that year — I watched it go from a hum, to the hum getting louder, to "holy shit, Good Alexander's tweet is going to hit 5 million views, this makes me want to short it." So it became the accelerator or inflection point for that story.
But news is the same way — when the news first comes out the stock doesn't react at all, and finally the story reaches that parabolic peak, and then the following Monday all the price action shows up at once. That's how the DeepSeek trade was, and to a large extent the Meta move too.
Young People Should Try More and Find What You're Truly Addicted To
Host: Last question. There's a kind of long-term decadent "grab the money and run" feeling in the market now. For young people who haven't found their place yet, what would you advise them to do? How should they position themselves?
Guest: Thanks for having me. Honestly, I think it's remarkable that you've been able to do this show in this space and get to where you are now.
I'd say this: you play a video game, and if you don't genuinely enjoy playing it, you can never win. No one reaches an extremely high level at Call of Duty without truly loving it. So if you're young, you should try a lot — don't lock in too early. Try this, try that, find that thing. If there's any sign of early success — and better than early success is early signs that you're "addicted," in a good way — then go all in.
That's how I stumbled my way through it myself — first music production, then math research, then blogging, then venture capital, playing poker, and finally getting lucky with early success in NFTs, and I genuinely enjoyed it, so I kept pressing and seeing what would happen. Eventually you definitely want to compound on something. But if you're really young, you have more time and more optionality than you think. You should take advantage of that and discover it yourself, rather than doing whatever someone else tells you is cool.