Alien Road: The Market Has Entered the ‘Fartcoin’ Phase

At Alien Road, we believe the current bull market has reached an unprecedented level of speculative behavior that defies conventional wisdom.

“We have entered the ‘Fartcoin’ stage of the market cycle,” our latest investor report, referencing sources such as CNBC, states. “Apart from trading and speculation, these assets serve no fundamental purpose and address no unmet market need.”

The surge in popularity of a cryptocurrency token called “fartcoin” reflects the exuberance that followed the recent election of Donald Trump, which has unleashed speculative fervor across financial markets. The meme coin has skyrocketed in value, approaching a $2 billion market capitalization—surpassing numerous U.S.-listed companies.

Following fartcoin’s rise, additional meme coins have entered the market. Among them, Trump introduced $TRUMP, a meme coin built on the Solana blockchain. Over the weekend, its market cap surged past $14 billion. Despite experiencing a brief decline of over 20% within 24 hours, the coin quickly recovered, trimming its losses to around 3%. Adding to the momentum, Melania Trump also introduced her own token.

“There seems to be no end to the creation of these speculative assets,” the report continues. “We might be transitioning from the Fartcoin phase to the Trump (and Melania) memecoin era. The trajectory from here is uncertain, but one thing is clear—it’s bound to be an unpredictable ride.”

This assessment comes as equities continue to climb, driven by investor optimism surrounding potential tax cuts and deregulation under the Trump administration. The Dow Jones Industrial Average surged by over 400 points following the inauguration, while the S&P 500 and Nasdaq Composite recorded gains of 0.8% and 0.7%, respectively.

Shorting Leveraged Bitcoin ETFs

Alien Road took advantage of the heightened speculative environment in the fourth quarter by strategically positioning against certain exchange-traded funds (ETFs) linked to bitcoin.

Our focus was on the T-Rex 2X Long MSTR Daily Target ETF (MSTU) and the Defiance Daily Target 2X Long MSTR ETF (MSTX), both of which utilize derivatives to achieve double the daily returns of MicroStrategy, a software company turned bitcoin treasury powerhouse.

However, due to the inherent volatility of MicroStrategy and the limited availability of derivatives necessary for achieving leveraged returns, these funds have faced challenges in their performance.

Alien Road successfully capitalized on this volatility by shorting these ETFs during the quarter, a move that was partially offset by holding MicroStrategy stock in an arbitrage trade—ultimately resulting in a significant gain.

As market conditions continue to evolve, we remain vigilant in navigating the ever-changing landscape of speculative assets, positioning ourselves to capitalize on emerging opportunities while mitigating associated risks.