Author: Paul Veradittakit

Translation: Deep Tide TechFlow

Deep Tide Introduction: While everyone is talking about AI siphoning off $211 billion and cryptocurrency only has $20 billion left, Pantera partner Paul Veradittakit sees the strongest lineup of founders in four cycles during this bear market. These operators from Goldman Sachs, Citadel, Stripe are not here to speculate on narratives—they are targeting the hard problem of institutional-grade financial infrastructure that has finally become sexy.

The fit between founders and the market is the most enduring signal in venture capital. Products change, markets change, and regulatory frameworks change. But the pairing of specific founders with specific markets is the only unchanging constant, which is also the only thing that continues to compound when prices do not rise.

We have never seen such a high founder-market fit in the blockchain space. The interesting questions have converged around AI and fintech, while the most serious operators are pouring in from Citadel, Stripe, Block, and Goldman Sachs, because that hard problem—institutional-grade financial infrastructure—has finally become the most interesting one.

We value four traits: deep domain expertise, high initiative, unfair network advantages, and obsession. Every category-defining project we bet on during the bear market, from Offchain Labs to Ondo, possesses these four traits.

The founder-market fit is the only thing that continues to compound when prices do not rise. Products change, markets are re-priced, and regulatory frameworks evolve. The pairing of specific founders with specific markets is the constant, and bear markets are the best environment to discover this pairing.

If you are deciding what to do next, the market looks terrible. Bitcoin has halved from last year's high of $126,000 in October, market sentiment is fear, and most funding and almost all attention has shifted to AI—last year AI attracted about $211 billion, nearly half of all VC funding, while blockchain only received about $20 billion. Data from Electric Capital shows that since the beginning of 2025, blockchain code submissions have dropped by about 75%, and early 2026 saw the industry’s most recognized operators announcing their shift to AI.

But this picture misses something. The vast majority of developers leaving came in during the last bull market. Builders who have been here for two years or more have just reached historical highs and are now writing about 70% of the code. This is exactly what happened in 2022 when the core developer group actually grew during a 70% drawdown. A bear market does not empty the room; it only clears out those who came for the price.

So the question is never whether the market will come back, but who will still be standing when it does. The answer each cycle boils down to the fit between specific founders and specific markets. This is the founder-market fit, and it is also the most enduring signal.

What is truly compounding

The word "fit" comes from Andy Rachleff and Marc Andreessen. But blockchain compresses this concept more thoroughly than any other market. Those who built the technology, the cypherpunks and early libertarians, were already obsessed with the market before there was one. They had nothing else to own. Fit is everything.

Product-market fit asks whether the product has found an audience. Founder-market fit asks the earlier and more difficult question: why is this specific person better suited than anyone else in the world to win this specific market?

This distinction is everything in a bear market. Other things on the founder's roadmap are temporary. In the blockchain space, the product you deliver three years from now will not be the one you are working on today; markets will reprice, and regulatory frameworks will shift beneath you. When the founder is truly matched with the market, these factors are not fatal. Their understanding of the underlying dynamics is deep enough to maintain an advantage during transformation. When they are not matched, they will blindly pivot to a space they do not understand, and the bear market will consume them.

We have made our best bets in bear markets rather than bull markets, supporting founders before categories existed, from the earliest Ethereum scaling infrastructure to today’s tokenization infrastructure. In this highly reflexive market, fit is the most enduring signal we have.

We have never seen such a high degree of fit

There is a part here that should change your interpretation of talent drain. In previous cycles, talent was dispersed across hundreds of speculative narratives, with most people chasing prices. This time is different. The interesting questions have converged into two verticals, AI and fintech, while the quality of founders choosing to solve these problems with blockchain is the highest I have seen in four cycles.

The clearest evidence is who is emerging. The hard problem in blockchain is now institutional-grade financial infrastructure, which has been a career-long challenge for the best operators in traditional finance. Nathan Allman left Goldman Sachs' digital asset division to found Ondo, now managing about $2.6 billion in product suites, bringing treasury bonds and other assets on-chain. Ed Felten co-founded Offchain Labs after leaving his professor position at Princeton and the White House, building Arbitrum. Even within our own company, my partner Franklin Bi comes from JPMorgan's Onyx blockchain division. Now the founders walking into our conference room come from Goldman Sachs, Citadel, Stripe, and Block; they are not here to trade narratives. They are here because this hard problem has finally become the interesting one.

Market data supports them. Real-world assets tokenized on public chains have surpassed $30 billion, growing over 400% since the beginning of 2025, along with about $300 billion in stablecoins. Goldman Sachs, JPMorgan, and Bank of New York Mellon have all launched tokenized products. The GENIUS Act last summer provided a federal framework for stablecoins in the U.S. BCG predicts that tokenized assets could reach $16 trillion by 2030. When a serious version of a problem arrives, serious founders come along as well. This is the scaling founder-market fit; we have never seen such concentration in any prior bear market.

The four aspects we evaluate

When I meet a founder in such a market, I look for four things.

Deep domain expertise. You have lived in the market, not just read its map. In a bear market, buyers only attend critical meetings; technical depth can beat out a good-sounding sales pitch every time. Ed Felten had spent a lifetime tackling the hardest problems in systems and security before co-founding Offchain Labs and building Arbitrum. We led the seed round. This depth is why the team can clearly see the scalability issue, while most in the market are still debating it.

High initiative. The ability to convey your understanding of a specific market's trajectory to dense, skeptical talent by showcasing actual insight. Stani Kulechov did this. Without any financial background, based solely on conviction and understanding, he transformed ETHLend into Aave and continued to build the defining DeFi money market protocol.

Unfair network advantage. When you have both the background and relationships that allow you to be faster than others, vision becomes more important. A warm introduction goes further than any cold start, and in the categories being built now, this advantage compounds. Nathan Allman emerged from Goldman Sachs's digital asset world, armed with a network and the belief that this was the right time to launch Ondo. I led our seed round in 2021, and today Ondo controls a large portion of the tokenized equity market.

Obsession. People leave when times are tough. Those who are truly obsessed have been in the game for years, spanning cycles, and started long before there were any returns. Hal Finney, Nick Szabo, and Adam Back spent decades researching digital cash without any market or money, driven solely by conviction. This is a quality that won’t appear on a resume but is more important than anything else.

To the founders already in the arena

In a bear market, belief is the only fuel that remains.

In a bull market, momentum helps founders get the job done. Capital is cheap, hiring is easy, and every release attracts attention that is often undeserved. A bear market strips all of this away; the only thing left to drive founders forward is belief.

Belief is not an emotion. It is an observable output of true founder-market fit. Founders who deeply understand their market continue to build when tokens have dropped 50% and all headlines have turned to AI because they can see the endpoint that the market cannot yet price. Those without belief look at the same charts, lose courage, and then leave. This is why a bear market is the best time to evaluate founders. Prices help us filter, leaving exactly the signals we are trying to buy.

If you are one of those operators at Goldman Sachs, Citadel, or Stripe wondering whether it’s the right time, here is my message: yes. A bear market is not a risk; it’s a proving ground, the cleanest environment for building compounding fit. Blockchain does not need more tourists. It needs more founders with true fit to drive progress in financial infrastructure, and there has never been a better starting moment than this window when everyone is leaving.

To the founders already in the arena: stay focused and keep building. Founder-market fit is what continues to compound when prices do not rise, and prices will test that belief. Fit enables it to endure.

Our commitment has not changed. We launched the first U.S. Bitcoin fund in 2013 when the price was $65, and since then we have made category-defining bets in every bear market, including the seed round of Arbitrum in the last bear market. We will continue doing so in this bear market. If you are building at the intersection of market and belief, that is where we want to get in early.