Bankless Founder Who Sold All ETH Turns Big Profit in Three Months with Five Assets

Author: Xiao Bing

On May 21, David Hoffman, co-founder of Bankless and the most vocal evangelist of the Ethereum ecosystem over the past six years, tweeted early in the morning that "the atmosphere on crypto Twitter has really changed lately, and he sold his last bit of ETH."

Three and a half months later, he has become a big winner.

What Did Hoffman Buy? {#article-toc-33783-2}

In early June, Hoffman disclosed his portfolio transition on X, revealing that the funds from selling ETH were deployed in two batches:

The first batch, about 50% of the funds, was immediately allocated to four assets after selling ETH: VVV (the governance token of Venice AI), NEAR, ZEC, and HYPE. He specifically mentioned in his tweet that he bought NEAR at around $1.4.

The second batch, also about 50% of the funds, was reserved for DCA (Dollar-Cost Averaging). His exact words were "to slowly buy something that hasn't gone up yet." This money ultimately went entirely into LIT (Lighter, a token for an on-chain perpetual contract exchange based on zkRollup).

His logic for buying LIT was exceptionally clear: exchanges are always the best business model in the crypto industry; Lighter's buyback speed is about twice that of HYPE; zk circuits allow users to verify whether the exchange adheres to its own rules without permission; the product has lower latency, a better fee structure, and supports more assets, including the Pre-IPO market.

When asked how to choose between "LIT and HYPE," his answer was that LIT is both the Beta and Alpha of HYPE, and he even tweeted at the end of June expressing regret for not buying more LIT.

This presents a very clear investment framework: betting on the privacy narrative with ZEC, betting on structural growth in the on-chain derivatives sector with HYPE and LIT, betting on cross-chain infrastructure and AI Agent narratives with NEAR, and betting on decentralized AI reasoning with VVV.

The five assets cover four narrative tracks, none of which are related to the valuation of Ethereum L1.

Performance Report {#article-toc-33783-3}

Comparing the prices before and after Hoffman disclosed his holdings. He sold ETH in late May, with the first batch of positions established from late May to early June, and the DCA for LIT continuing until mid-June. Below are the approximate prices of each asset in early June as the basis for comparison with the latest prices in early September:

ETH: Sold at about $2100 → Currently about $2450, an increase of about 17%.

ZEC: Entry price about $540 → Currently surpassing $1200, an increase of over 120%.

On September 6, it briefly touched $1200, doubling in three months, with the catalyst being the launch of Grayscale's ZEC spot ETF (ZCSH) on August 25, which saw AUM grow from $300 million to $460 million in two weeks, compounded by a short squeeze of $46 million.

HYPE: Entry price about $56 → Currently about $87, an increase of about 55%.

On September 6, it reached a historical high of $89.54. The token burn of Hyperliquid has exceeded $4 billion, with daily protocol revenue maintaining around $2.26 million, and the cash-generating ability of this on-chain ATM is still accelerating.

LIT: Entry price range about $1.5-2 (DCA average price) → Currently about $4.7, an increase of about 135%-210%.

On September 5, it reached a historical high of $4.95. As Hoffman's heaviest single position (accounting for 50% of total funds), LIT contributed the largest absolute return in the entire portfolio.

NEAR: Entry price about $1.4 (confirmed by Hoffman) → Currently about $2.37, an increase of about 69%.

VVV: Entry price about $16-18 (in early June, VVV was near its ATH, touching a historical high of $21.32 on June 3) → Currently about $17, basically flat.

This is the weakest performer among the five assets, and it is also the only position where Hoffman has not publicly increased his stake or expressed regret.

Making a rough estimate of the overall portfolio return: Assuming 50% of the funds are equally weighted among VVV, NEAR, ZEC, and HYPE (12.5% each), and 50% allocated to LIT, the overall portfolio return is estimated to be around 90%-120%. During the same period, ETH's increase was about 17%.

Hoffman's portfolio outperformed ETH by at least 70 percentage points.

Where Did He Win? {#article-toc-33783-4}

Looking closely at this performance report, the most noteworthy aspect is not how much each asset has increased, but how Hoffman's selection logic has been repeatedly validated by the market over the past three and a half months.

The surge in ZEC can be traced. Grayscale's ETF application has been in the SEC process since last November, and the official launch on August 25 was merely the realization of a long-nurtured institutional variable into price. When Hoffman bought in May, ZEC had already risen from over $30 at the beginning of the year to over $500; he chose to enter during the window of "having risen a lot but the ETF has not yet landed," essentially betting that the certainty of the catalyst outweighed the short-term risks of price.

The logic behind LIT is even more worth dissecting. While everyone was discussing how HYPE could become the Chicago Mercantile Exchange on-chain, Hoffman chose a competitor that was earlier, smaller in market cap, but potentially more aggressive in product structure. His judgment framework was to "look for higher elastic Beta within the same track," while also layering on structural reasons such as "faster buyback speed, transparency premium provided by zk verification, and user migration potential from lower fees." In hindsight, LIT has risen about 500% from its bottom to its current price, validating this line of thinking.

NEAR's 69% return ranks fourth in the entire portfolio and does not seem dazzling. However, considering the current role of NEAR Intents as a "toll booth" in the ZEC market (ZEC-related trading pairs account for nearly 40% of NEAR Intents' total trading volume), Hoffman may have inadvertently constructed a self-reinforcing portfolio: the more ZEC rises, the greater the trading flow through the Zashi wallet and NEAR Intents, leading to higher fee income for NEAR Intents, which in turn strengthens the buyback of NEAR. There exists a hidden positive feedback loop between the two assets he purchased.

VVV is the only position that has not materialized. The narrative of Venice AI as a decentralized AI reasoning platform briefly surged in early June but lost sustained catalysts, and Hoffman has not publicly increased his stake.

The Real Issue {#article-toc-33783-5}

Hoffman's performance report provides a signal that is more worthy of exploration than "who has increased the most": The value center of the crypto market is shifting from L1 valuation to application layer revenue.

The ETH he sold is an L1 asset, with its valuation logic based on network effects, developer ecosystems, and gas burn mechanisms. Among the five assets he bought, the valuation anchors for HYPE and LIT are verifiable protocol revenues and buybacks, ZEC's valuation anchor is institutional demand (ETF) and observable on-chain privacy usage data (shielded supply ratio), NEAR's valuation anchor is transaction volume and fees at the cross-chain settlement layer, and VVV's valuation anchor is the actual usage volume of AI reasoning services.

The common feature of these five assets is that their valuations derive from independently verifiable on-chain activity data, rather than narrative promises about the future.

Hoffman's decision to sell ETH is unrelated to the technical merits of Ethereum; he himself stated, "I still believe Ethereum will win." He simply realized earlier than most that: In a liquidity-scarce market, faith does not generate returns; only verifiable cash flows and quantifiable demand generate returns.