Bankless co-founder David Hoffman identified perpetuals, AI tokens, and privacy coins as the strongest areas of the market.
- Privacy coins were among the best-performing on Wednesday, led by major gains in Zcash and Monero.
- Anchorage head of research, David Lawant, added the divergence reflects a more mature crypto market where capital rotates between sectors based on fundamentals rather than moving in lockstep.
- Bitwise CIO Matt Hougan concurred that while the broader is trading lower, other sectors are thriving.
As Bitcoin (BTC) fought to stay above $66,000 in midday trade on Wednesday, dragging the overall cryptocurrency market down with it, Bankless co-founder David Hoffman, Bitwise investment chief Matt Hougan, and Anchorage’s David Lawant agreed that there’s a “bear market” in place, but three corners of the market are bucking the trend.
“It’s a bear market for crypto,” Hoffman said in a post on X. “But a bull market for perps, AI, and privacy.”
Lawant, Anchorage Digital’s head of research, agreed. “I see the fact that we did not get a generalized crypto bear market as a positive signal,” he wrote. “Mature asset classes price idiosyncratically most of the time: names decouple, capital rotates on fundamentals. Crypto is finally trading like it.”
Bitwise CIO Matt Hougan echoed both with a single word: “Yep.”
Privacy Coins Outperform The Crypto Selloff
Privacy coins rose more than 8% in the last 24 hours as a category, per CoinGecko, and were among the strongest-performing sectors in crypto on the day. Privacy coins led all of crypto in 2025. Zcash (ZEC) rallied 861%, while Monero (XMR) rose 123%. Zcash hit $600 last month, with Grayscale filing for a spot ZEC ETF.
On Wednesday, ZEC’s price rose 1.6% in the last 24 hours, and XMR’s price gained 4.7%. Both outperformed Bitcoin, which fell 2.8% to around $65,700 at the time of writing.
However, retail sentiment on Stocktwits remained tempered around both privacy tokens. Sentiment around Zcash trended in ‘bearish’ territory over the past day, while sentiment around Monero trended in ‘neutral’ territory.
Perpetual Trading Tokens Hold Up Despite Market Weakness
Perpetual coins, as a category, moved 1.3% lower – still outperforming Bitcoin – but major tokens including Aster (ASTER), Jupiter (JUP), and Lighter (LIT) moved higher in the last 24 hours.
Hyperliquid (HYPE), now the 10th largest cryptocurrency in the market after flipping Dogecoin (DOGE) earlier this week, traded flat. Retail sentiment remained in ‘extremely bullish’ territory. The third Hyperliquid ETF in a month by Grayscale also made its debut on Wednesday.
Meanwhile, Lighter rallied nearly 20% in the last 24 hours. Retail sentiment around the LIT token on Stocktwits trended in ‘extremely bullish’ territory over the past day, while chatter stayed at ‘extremely high’ levels.
ASTER’s price rose 2.4% to $0.68, while JUP’s price gained 1.8%. Retail sentiment around Aster moved to ‘bearish’ from ‘neutral’ territory over the past day, while sentiment around Jupiter remained in the ‘bearish’ zone.
AI Crypto Tokens Show Signs of Selective Strength
AI coins dropped around 3.8% in the last 24 hours, but Near Protocol (NEAR) shot up by over 12% in the last 24 hours. Retail sentiment around the NEAR token on Stocktwits improved to ‘neutral’ from ‘bearish’ territory over the past day.
Lawant’s point about idiosyncratic pricing has a specific meaning. For most of crypto’s history, AI tokens were the only sector to post gains in Q1 2026 as Bitcoin and Ethereum (ETH) fell sharply. Perp DEX volumes grew as spot volumes contracted amid geopolitical uncertainty fueled by the U.S.-Iran war. Privacy coins rallied amid regulatory changes, while large caps bled.
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