The Milk Road Show The Leverage Flush That Changed This Crypto Cycle w/ Craig Birchall
Dec 22, 2025
Craig Birchall, Head of Lending & Financing at FalconX, dives deep into the current crypto landscape. He discusses the aftermath of the 10/10 liquidations and why the market seems stagnant despite better macro conditions. Birchall highlights intriguing trends like stablecoin adoption in payments and institutional interest in Bitcoin lending. He believes crypto is integrating with traditional finance while still preserving its decentralized roots. Additionally, he evaluates revenue-generating projects as promising investments, suggesting a shift toward more sustainable crypto strategies.
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Leverage Flush Drove Liquidity Drain
- The October 10 liquidation removed a lot of leverage and liquidity from crypto markets, causing prolonged selling pressure.
- That leverage flush explains why crypto lagged equities even as macro improved.
Macro And AI Keep Institutions Cautious
- Macro risks and AI/data-center uncertainties keep institutional capital cautious and slow crypto demand growth.
- That caution can mute crypto rallies even when rates start to fall.
Buy Fundamentals, Not Euphoria
- Deploy capital into fundamentally strong crypto projects trading at discounts instead of chasing yield-chasing euphoria.
- Focus on assets with revenue and buyback mechanics when reallocating during drawdowns.