Federico joined CoinTelegraph's Chain Reaction podcast, hosted by Ciaran Lyons, to break down how retail behavior is splitting into two distinct speeds and why AI, done right, should make traders sharper rather than replace their judgment.
A Market Splitting in Two
Federico described today's market as a barbell: on one end, high-volatility memecoin trading driven by fast-moving, younger users; on the other, a narrower set of over-performing altcoins, names like HYPE, backed by real, functioning businesses that attract more mature capital. Social trading is largely responsible for the shift. Algorithm-driven discovery on TikTok, Instagram, and YouTube now rewards content regardless of follower count, meaning smaller creators can reach real audiences and push a thesis on a specific token as effectively as accounts with millions of followers, a real departure from a few years ago.
Asked whether the average trader is actually getting better by following others, Federico was direct: the average trader is getting worse. That doesn't mean opportunity has disappeared, volatility still produces winners, but he views a market that collapses into pure memecoin speculation as reductive for the industry. His own preference still leans toward tokens with real documentation and stronger fundamentals.
AI as a Force Multiplier, Not a Replacement
On AI's growing role in trading, Federico made a distinction worth sitting with: crypto is now more intertwined with the broader world than ever. Rate decisions, AI developments, energy prices all move markets in ways that used to feel separate. An AI assistant's real value is helping traders connect those dots and process fast-moving, cross-domain information quickly, rather than making the decision for them. "It will always be up to the user to make the final decision," he said. Agents won't replace traders; the human stays in the loop.
He sees this playing out fastest in DeFi, where AI agents are well suited to assembling a diversified position. Treasury bonds, yield strategies, and a sensible allocation across assets is a relatively contained task for an agent to handle well. Fully automating active trading is a harder problem: outside of becoming a liquidity provider yourself, he doesn't yet see a passive strategy that reliably works without human oversight. Done right, he argued, technological improvements like this can help narrow the information gap rather than widening it.
Memecoins: A Smaller Comeback Than It Looks
On the renewed memecoin activity, Federico pushed back on the idea that it represents a major resurgence. Memecoins used to reach multibillion-dollar valuations; now, even ones backed by platforms like Robinhood have topped out around $250 million, a fraction of what the category used to command. For now, the resurgence is limited in scope. What they still do well is generate volume and volatility, and capital will always chase that. "There will always be something going up from zero," he noted, enough on its own to keep the memecoin cycle alive.
He also pointed out that memecoins haven't necessarily displaced DeFi so much as absorbed volatility that used to sit with mid-cap altcoins and infrastructure tokens, many of which have struggled through this cycle. On whether added utility can meaningfully boost memecoins, Federico's view was cautionary: bolting utility onto a project that never fundamentally needed can do more harm than good. It pushes the project into making promises it never had to make in the first place, just to chase retail hype, and if those promises don't hold up, that's what ends up hurting the token. His takeaway: projects shouldn't overpromise just to chase retail attention.
DeFi's Self-Custody Problem
Looking ahead to 2030, Federico sees DeFi as having made real strides. Larger platforms are increasingly working alongside regulators rather than around them. The weak point remains self-custody: as digital threats grow more sophisticated, the risk calculus for retail users gets harder to justify. Permissionless access is valuable, but taking on the risk of losing an entire balance for a relatively modest upside is something DeFi still needs to reconcile.
On whether DeFi could pressure traditional banking, he framed it as a straightforward trade-off: if DeFi lending and borrowing becomes meaningfully cheaper, adoption may follow, but as long as the risk profile stays this high, most users will keep favoring traditional rails.
Bitcoin's Quantum Question and a Bullish Q4
On Bitcoin specifically, Federico pointed to a broader narrative: as AI reshapes how value gets created, hard assets, gold and Bitcoin alike, could see renewed interest from retail investors seeking something tangible. But he flagged a real risk to that thesis: quantum computing and its long-term implications for dormant wallets sitting exposed on-chain. That risk was partially priced in during a recent BTC pullback and rattled institutional confidence, part of why some investors have looked to more actively managed alternatives like Zcash, a trade-off he sees as both a strength and a weakness relative to Bitcoin's simpler, more static design.
Federico said he expects continued volatility in the near term but remains optimistic heading into Q4, pointing to Bitcoin's historical tendency to perform well in December, with room to reclaim previous highs and push past them into early 2027.
Watch the full episode on: https://x.com/Cointelegraph/status/2099846980218548608
