# Crypto Fundamentals: Long-Short Strategy & Value Accrual

**Podcast:** The Milk Road Show
**Published:** 2026-09-25

## Transcript

We're interested in making bets on both, betting on winners, especially when they're priced to lose, and betting on losers, especially when they're priced to win.
The bulls are back after Bitcoin finally broke out of some key resistance levels.
But what does that mean now?
Where do we go from here?
And what do we need to know as crypto investors to navigate these markets?
Hello and welcome to Milk Road Crypto, the show that knows that it is better to find what's going to pump next than to chase what has already pumped.
I'm your host, John Gillen.
Today, we are joined by Greg Viverito.
He is the general partner at Tag Capital.
Tag runs one of the best long, short, fundamentals-driven crypto portfolios in the entire business.
This guy has a ton of alpha to share with us today, and we're going to get into his strategy for these markets, and there's just going to be a lot of insight in this one.
I'm excited for this.
If that sounds good to you, make sure you like and subscribe.
Share this episode with somebody who's going to enjoy it.
As a reminder, our podcast today is free, and that would not be possible without our wonderful partners at Nexo, the digital asset platform that lets you trade, earn, and borrow all in one place.
So keep an ear out for more information on them later in today's episode.
But for now, welcome to Milk Road Crypto.
Greg, how are you, sir?
Doing great.
The bull's back.
The bull's back.
I thought that would be a good place to start the conversation, Greg.
A lot of people are looking at this breakout on Bitcoin and declaring that the bulls are back, that there's the start of a new bull market that's happening.
But some people are still bearish and saying that this is a fake out and a bull trap.
Where do you land on this conversation?
Which side do you tilt towards here?
Yeah, so we have this conversation basically every day between my co-founder, my partner and I.
And normally I'm the bear and he's the bull.
And I think the one thing that crypto has taught us is that it's never as good as it seems and it's never as bad as it seems.
So we're positioned for upside from here, but we certainly don't expect it to be without volatility.
And we certainly don't expect it to.
to necessarily include every token.
So I'm sure we'll get into that.
Yeah, I think we will too.
Well, tell us a little bit more about Tag Fund and sort of your role here.
Where do you guys see yourself in the industry?
And just for those who aren't familiar, tell us a little bit more about the company.
Yeah, so we started the fund four and a half years ago.
And at the time, it felt like we had a somewhat contrarian view, which was that fundamentals matter.
At this point, that's become a little bit more consensus.
It's taken us about four years to get there.
And when we started, we were structured.
We've always been a liquid fund, liquid tokens exclusively.
And we started as long only and over the course of time have shifted towards a long short strategy.
So I would describe this as long biased, but constantly trying to understand what.
the market is telling us and just the portfolio to reflect that.
So I've heard you say a lot about this in some of the things I've read from you on your sub stack and other things.
But you guys have talked about this pivot from being long only to long short as being a really key to your success here.
And you've said that we are in a dispersion regime in crypto.
Yes.
Which, yeah.
So I'd love to hear you just elaborate more on that and sort of like how you're navigating that in the markets.
Yeah.
I mean, I think we've sort of witnessed the market.
grow up over the past couple of years.
Right.
You know, in the early days, at least for us, 2021, 2022, the correlation of stuff was effectively one when, you know, when Bitcoin pumped, everything pumped.
And that's not the case now.
Right.
Like even in this this latest rally, you've seen some of the best alts lead.
And that doesn't mean that, you know, there's sort of like no, no activity amongst some of the stuff that shouldn't be pumping.
But you've seen this really the shift towards sort of fundamentals ruling the day.
And I think there was a period of time in like 2023, 2024, where the bloom just really fell off the rose on tokens being designed in a way that didn't make sense.
And also projects that were, you know, sort of lacked fundamental value.
And whereas those tokens, you know, were highly correlated to Bitcoin in the past, that was no longer the case.
And so as a fund, we sort of saw this opportunity to restructure and take advantage of the fact that coins can go down, right?
And at times go down quite a lot.
And so we think about both sides of the book as really fundamental bets, right?
You can sort of think of each project and each token on sort of two dimensions, one being traction.
and project success and the other being token design.
And, and we are, you know, we're, we're interested in, in, in making both bets on both betting on betting on winners, especially when they're priced to lose and betting on losers, especially when they're priced to win.
So I think this conversation would have been really interesting to have at the start of the bear market as opposed to now at the end of it.
But for the last year or more, I think you've been saying that it's just much easier to find shorts in crypto than longs.
But at the same time, it's also dangerous because like you said, some things can pump for no reason and then you're in trouble.
Talk to me about what you're looking for when you're trying to find a good product to short and what goes into that process of analysis.
Yeah.
And just to be clear, I mean, we got into crypto to be long crypto, right?
And we're always going to be more long than short.
We think the right construction is both tactical and fundamental.
So you're looking for projects that are either no longer being actively worked on or have structural and flow driven issues.
that are going to make it really, really hard for it to go up.
And so, you know, the classic example here is like, you know, sort of the like VC coins, right?
Like I think in many ways, and the reason that this dynamic persists is that there are, or there were, or there was a constant bid in private markets for many of these tokens.
And so they created this dynamic where you just had a lot of supply locked in profit.
and the marginal buyer effectively went away.
And so when we look at the universe, you can sort of, like I said, break it down into good project, bad project, good token, bad token.
The projects that are doing well, have found product market fit, are generating revenue, and are also finding ways to accrue that value to token holders.
That's where you want to be investing.
And then, you know, in some cases, you've got projects that had really interesting designs and are the forebears of some of the things that are working right now.
You know, we've been investing in the perp space for years.
Some of the earlier tokens there had really good models, GMX, DYDX, but the business didn't succeed or hasn't succeeded.
And on the other end, you have projects that are...
having success, but the tokens don't make a lot of sense.
And so we sort of write off both of those categories as the messy middle and focus on the investable universe, which is good project, good token, and the potential shorts, which is a bad project, bad token.
Just want to pause for a quick second to remind you all that the crypto bull market is back.
I have been deploying capital into altcoins that I think are going to do very well this bull market.
Some of them are already up over 2x from where I entered.
So if you want to see what's in my portfolio, what's on my watch list, and have access to me in Discord to ask questions 24 hours a day, join Milkroad Pro now.
The link is in the description.
It's just a dollar.
I'll see you there.
Now that we've seen the markets start to turn more bullish, are you going to table the shorting aspect of the strategy for now?
Or do you think you're going to continue to look for shorts even during a bullish uptrend?
No, I mean, I would, and we would have answered this question probably differently a few years ago, but I don't ever imagine us not having a short book.
Rather, we'll flex it based on the market environment.
So whereas we were closer to 30% short to start the month, we're going to end the month closer to 20% short.
But, you know, when we look up and down, up and down the screener, there's still a lot of tokens.
that don't make sense.
And there's still a lot of valuations that don't make sense.
And even in an uptrend for a fund like us, you know, it's based in the U.S.
that has to pay taxes on our capital gains.
A short book is actually quite helpful in any market environment.
You know, I like to think what we're doing is running an all-weather portfolio.
And so certainly we expect to lose money on the short sleeve.
during an uptrend, but we can also use those gains to offset our rotations that we want to make off of the winners.
And we can also, you know, in times like this, you're paid to be short, whereas, you know, six months ago, we were we were paying to be short.
And so we just think it really sort of complements, you know, a core long strategy well, to be able to you know, harvest losses, tax losses, and harvest funding, you know, when we're in times like this.
Gotcha.
Okay, well, let's talk about some of these tokens that fit into this short thesis of yours.
You famously have been shorting the Trump...
coin the trump meme coin um which is now down below two dollars i believe and had an all-time high of somewhere north of twenty dollars um and you know i'd love to hear you elaborate more on how you go about um finding a short and sticking with it and what what you might still be looking at it as a short right now yeah i mean this is this is sort of the classic example of of a of a coin that really never deserved its valuation once it pumped.
And I would say I'm a bit a skeptic on meme coins in general, but a lot of them are not great shorts because a lot of them have, or most of them have fair launches and fully unlocked supplies.
And so, you know, very susceptible to a quick run up in times of euphoria.
Trump, on the other hand, was basically in the hands of insiders from day one.
And when you looked at it in, you know, month two, month three, there were no buyers left and the sellers had infinite tokens.
And so, you know, that's sort of where we began our short journey was with Trump trading like 10, 15 and just looking at it as the air came out of that.
you know, first meme cycle on Solana and asking ourselves, who's going to buy this thing, right?
Like all the buyers have already bought, you know, we're not, we're not, we're not here to say that memes are never coming back.
Obviously we've seen that they have, but this one in particular had way more sellers than buyers.
And so we're just constantly asking ourselves that question, like who's the marginal buyer here?
Who's the marginal seller?
And, and at least for that one, we couldn't, we couldn't figure out who the marginal buyer was.
the marginal seller was quite obvious.
Well, I'm going to leave that with no additional comment, but it sounds like you found a winner in the shorting category there on that one.
I would like to hear, we've come through a long bearish period here.
There's been a lot of down only in crypto the last couple of months excluded.
How much of your fund's outperformance do you think you attribute to the short positions in the portfolio during that bear market?
And how much actual performance was contributed by this strategy?
During the first half of this year, Effectively, all of it, right?
Like it sort of got us through the bear market and allowed us to harvest cash that we deployed into things we liked on the long side, into core spot positions, so that we would be in a good position to outperform times like now.
And so it was essentially...
all of our P&L for the first half of this year, and it allowed us to reduce the volatility of the fund.
And of course, we're giving up a little bit of upside on the short book at times like this, but overall, I just feel really comfortable sitting in some of these names that, again, it's just hard to imagine.
One of our kind of overarching theses is that crypto is going from speculative to fundamentals right it's like why should this asset class be different than every other asset class on earth right like people want to buy businesses that are good that make money that return money to to shareholders or token holders like this isn't this isn't um like controversial stuff and um you know in the last couple of weeks months it's gotten a little bit easier to find longs but it's still really easy to find shorts, right?
There are a lot of projects that simply aren't generating anywhere near the revenue that you would expect from, you know, from a company with that level of valuation.
And so it's not necessarily to say, you know, these projects are bad.
In many cases, they may not be.
But...
It is to say, sort of in a unique position where, you know, as as liquid investors, you can look at what's working, you can look at what's not working, and you can get exposure to both.
At the same time, it's a lot easier to make money on the long side than it is on the short side.
Right.
It's it's there's a reason there aren't many, many short selling funds really in any market.
It's a really hard way to to gain.
Right.
Like the your upside is capped.
It can only go down 100 percent.
And so we, you know, we very much view it as a component.
of a more comprehensive strategy and one that works uniquely well in crypto because there are so many tokens that frankly deserve to go to zero i appreciate the the thoughts on that shorting is very dangerous and you know 100 loss is the cap but it's still always a risk so um yeah and the other thing i'll mention here is that um we we take a basket approach right and so yeah i called out trump because that's one of the favorites and we size it accordingly.
But whereas we have a core, five to 10 core longs, we're looking at, you know, a couple dozen shorts, right?
And structuring it as a basket helps insulate, again, some of that single name volatility.
And if it's sized correctly, you have the opportunity to increase your position, right?
You never want to get into a position where your short doubles and you have to close it because it's...
too much of your book, right?
We always want to be in the position where we can add on a rip and really sort of take the other side of those short squeezes.
Gotcha.
Okay.
Yeah.
And there's a lot that goes into managing a short book.
It's not the easiest thing in the world.
I do want to pivot this back towards the long conversation because that's where I think a lot of attention is right now and where a whole lot of audience is going to be interested.
I want to hear your thoughts on this value accrual thesis and the fundamentals that are driving valuations here, where I'm sure you debate this all the time internally, too, like all of us do.
But where do you see that landing right now?
And, you know, I want to also tie this to crypto equities, because I think two of your most recent long positions have been in the equity space.
And it just fit that into that value accrual conversation for me and what you're seeing there.
Yeah.
One of the most interesting things we noticed earlier this year was that the earnings multiple.
on DeFi in aggregate had come way, way down.
So I think a couple of years ago, the sort of like aggregate multiple was 100 and then it was 50 and then it was 20.
And you would like go to these conferences and you could sort of hear people say like, well, you know, it's like kind of in the strike zone here, hard to imagine it going down much, much more.
And it did and it continued to.
And this year, I think the aggregate multiple in DeFi earnings was like 10.
And so we sort of looked at that and thought this was a really good opportunity to buy what felt like the bottom in terms of the earnings multiple on these businesses, you know, constantly reminded of how reflexive crypto is.
And this is why the bear markets hurt so much is because when you're dependent on generating on-chain revenue and on-chain activity goes away.
revenue goes away.
And so the business all of a sudden starts to look really, really bad.
But what we noticed this bear market was that there are actually many protocols that were still generating some revenue.
The earnings multiple that the market was giving them felt unfair.
And so as we've watched these multiples compress, we just got comfy with the reality of, yes, they could compress more.
But these feel unfairly low.
And when we zoomed out and we thought about what was happening, it was clear that, you know, you're constantly, I think, as a crypto investor, sort of trying to track where we are.
You know, it's like you've got the price action on sort of one line, and then you've got the fundamentals, which are sort of going above and below the line.
And it just felt like the...
You know, the fundamentals had gotten too cheap.
So, you know, most of the stuff that we're in outside of the majors is on-chain finance.
I mean, that's the thing in crypto that's really working.
And that's where most of our longs are.
You know, one of the weird things about crypto is that the longer you're in it, the more accounts you seem to end up with.
You buy in one place, trade somewhere else, earn yield somewhere else.
And if you actually need capital, you end up having to sell something that you probably wanted to keep.
That's why we at Milk Road are partnering with Nexo.
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Tell them Milk Road sent you.
Well, let's talk about some on-chain finance then.
There was an announcement today, which will be, I think, two days ago when this episode was released.
But this morning, Galaxy added $100 million of SUSDS to its corporate treasury.
They've approved SUSDS as an eligible collateral asset across their institutional trading business.
This seems like some institutional adoption of on-chain finance.
And I'm curious your thoughts on that.
this because I think you guys have been pretty bullish on Sky for a while and it seems like the institutions are starting to adopt this.
What's your view on this and the setup here for on-chain finance?
Yeah, we've been holding Sky since it was Maker.
I just think it's sort of a misunderstood protocol, somewhat of their own doing.
I think the rebrand was messy.
Governance is complicated.
And as a result, people have had a hard time wrapping their mind around what this is.
But at the end of the day, it's been around as long as anything.
It is extremely cheap in terms of just earnings and the multiple.
You know, we, I would say the kind of one of the sort of highest conviction viewpoints we have is that there will be more stable coins on chain in the future.
And it's behind USDC and USDT, it's the best stable coin on chain.
And so for us, you know, we just look at that and just feel really comfy in it as a long-term position and have honestly been really, really also encouraged by.
you know, some of the hires they've made with the Sky Foundation and, you know, bringing people aboard that are going to go out and do deals like the ones you mentioned with Galaxy.
Yeah, I think part of this growing up and this adolescent phase for crypto is figuring out where the value is.
And I think a lot of the value is in the sort of...
messy gray area in between on-chain and off-chain, right?
Like it feels to us like we've exhausted, you know, the growth of the sort of self-custodied on-chain user.
And the next leg of growth is going to come from institutional capital.
Institutional capital wants to do deals with other serious people, right?
And so you need teams that are going to go out.
And they're going to tell the story and, you know, they're going to make it safe.
They're going to make it turnkey.
And I think that's what you're starting to see from Sky.
You know, another position we've held for a long time is Syrup, right?
Like those guys are going out and they're developing business to bring it on chain and then providing the infrastructure that actually allows that to happen better, faster, cheaper.
Well, full disclosure, I have positions in both of these too, so I get where you're coming from on this.
But I think there's some tension here in the market, and I want to kind of ask this question and get your thoughts on this because Standard Chartered came out and said that Sky was acting as DeFi's federal bank, and they said that they were doing $6 billion of lending.
They had a price target that they set, which is 5x from where Sky is right now.
However, at the same time, Sky just posted one of its best quarters ever, but they're redirecting a lot of that revenue towards a reserve as opposed to token buybacks.
And so the token price has been not flat, but not super responsive to this growth.
How do you resolve this tension in your mind?
And when do you think we're going to start to see sort of the success of this DeFi federal bank start to be reflected in the token price of Sky?
Yeah, it's a fair question.
I don't spend that much time thinking about When, right, if we have conviction in the team and we have conviction in the value, we're pretty comfortable waiting for that to happen.
I certainly don't think we have any edge on sort of figuring out, you know, when price action is going to happen.
As far as, you know, DeFi tokens go, it's been, I would say, steady, but not explosive.
And, you know, on some level, I think that makes it a valuable part of portfolio, you know, sort of think of it as like, you know, it's like the 6040 stocks bond.
It's like your it's like the bond section of a crypto portfolio in the sense that, you know, it's it's it's pretty sturdy.
But we're comfortable with a long term view on it and comfortable with with really seeing.
the team make the decision on how they want to allocate capital, right?
Like we're not dogmatic about buybacks versus reserves.
Like, you know, I think either can work.
It sort of just depends.
And the other thing that I think is really underappreciated about Sky is that the staking rewards are terrific.
And so for a long time, you were earning, you know, 20% paid out in USDS.
on the value of your sky position, on the value of stake sky holdings.
And so, you know, if you're staking and you're collecting rewards and the coin's not dumping, you know, pretty easy to be patient.
Well, patience is a virtue, I think, in this environment.
Greg, I want to ask you about something else.
There have been a lot of – there's been a lot of attention on this war about perpetuals, platforms, hyperliquid and lighter have gotten a lot of attention in this.
Both of them have buyback programs.
I'm curious your view on this because this week we've had Louis from – Proper, which is a prop trading fund, a company rather, on Hyperliquid.
We've also had Trevor King, who's the head of growth at Leiter.
And I've just been hearing a lot of conversation and attention on perps as an asset class and as an emerging sector of digital assets.
What's your view on this?
And where are you allocating your capital around this thesis?
Yeah, I mean, we love perps.
I mentioned at the outset that we've been investing in perps since the...
basically the beginning of DeFi summer.
And our view is that they are a superior instrument for leverage for most use cases, certainly for retail.
We also don't view it as winner takes all.
And so we hold both hype and lit.
We think they're both awesome.
We think both teams are awesome.
We think the value accrual on both.
is great and you know we think there's room for for both to really do well i mean our um you've held hut for a longer time than we've held lit lit is uh or lighter is a good example of sort of the one of the pitfalls right when they first came out it was really hard to untangle how much of the usage was actually you know like what the discount rate should be on that usage given the the incentives around around the airdrop and around farming And so that's one where we took a wait and see approach and we sort of waited for it to find a bottom, both not just in terms of price, but really in terms of usage and wanted to see what the unincentivized usage would look like.
And when that leveled off and price sort of joined it, you know, we got comfortable taking a big position there.
And we really, really liked the approach that they're taking in the U.S.
market, right?
The other inflection point, I think, for them was the deal with Robinhood and powering that product.
And we just think there's plenty of other fintech platforms that would benefit from offering perps to their users and just bullish that they would rather use infrastructure like Leiter than try and figure out how to build it from scratch themselves.
I like that perspective a lot.
I think it's a little bit like the Ethereum-Solana conversation.
You don't have to be bearish on one and bullish on the other.
They can both grow together, and I think they should.
All right, Greg, I want to end with some thoughts on what you're most bullish on for the rest of this year, because we talked about a few things you're very bullish on, and you said you've got patience and conviction in these plays, but there's a lot of things that are pumping on the market.
There's like Zcash and Venice and Near and just like...
Uniswap, all over the place, there's stuff ripping.
And I'm curious if there's something we haven't talked about that you think you're particularly bullish on for the rest of the year or just like how you think the market unfolds from here going into the end of 2026.
Yeah, I think the thing that we're watching most closely is the tokens and the projects that are going from bad token to good token.
So, you know, maybe in the past.
didn't have anything around value accrual or had really messy unlock schedules and are proactively trying to change that because they've seen the market reward the projects that actually do a good job with this.
So a couple of names, Athena, EFI, Grass, right?
These are projects that are going from, at least in our minds, sort of quasi-uninvestable based on you know, who was holding the token or uncertainty, opacity around their revenues, and now making a real effort on the investor relations front to tell people like us what they're doing, how they're doing it, how much money they're making, and giving us the confidence to underwrite those businesses.
So I would say that's where we're most excited is just looking.
You know, I said this to you before, but like for a while, it was really hard to find.
longs, right?
You could sort of like count on one hand, the number of protocols and crypto that were actually generating revenue and accruing value to token holders.
You know, the list is still short, depending on how hard you want to squint.
It's, you know, 10 names or 20 names.
I think what we're most excited about is, is, is the, is the projects that are taking that seriously and, and sort of putting themselves into the quadrant of, of good project, good token.
Yeah.
It's just a function of sort of keeping an eye on all the wonderful resources out there with regard to on-chain data and seeing where the growth is happening.
Greg Viverito, Tag Capital, general partner.
Thank you so much for being on Milcro Crypto.
I think there's a lot of alpha and wisdom in this and just, it's really helpful to hear how you're navigating these markets.
Where can we send people to find more of you and your work online?
Yeah.
So our, uh, Our quarterly letters are published on our Substack, tagfund.substack.com.
We'll be posting our next letter there in the coming weeks.
So check that out.
And then I'm on Twitter and happy to chop it up with anyone.
Well, Greg, I hope we can have you back on the show to catch up again soon.
Thanks so much for being on Milko Crypto.
Thanks, John.
Thank you all for joining us.
I hope you all learned something today.
So until next time, stay safe, stay educated, stay bullish, and we will see you all on the next episode of Milk Road Crypto.
Thanks for being here, everyone.
Bye.
Everything you hear on Milk Road is for informational purposes only.
These are our personal opinions, not financial advice.
And we may own some of the investments we talk about.
Always do your own research and make the decisions that are right for you.
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