Research
How Crypto Reacts to U.S. Tariff Announcements — and Why It Hurts More Than Stocks
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When the U.S. government announces new tariffs, markets panic, and crypto tends to take the hardest hit.
We’ve seen this pattern repeatedly: a single policy shock sends stocks tumbling, bonds rallying, and Bitcoin plunging twice as hard. But why does a trade policy aimed at physical goods ripple so violently through digital assets? And how long does it usually take for crypto to recover?
Let’s break down the dynamics, the psychology, and what we’ve observed firsthand in our own portfolio after major tariff shocks.
The Immediate Reaction: Panic, Liquidations, and Correlation
Tariff announcements are not just about economics — they’re about uncertainty.
The moment new import taxes or trade restrictions are declared, global investors shift into “risk-off” mode. Equities fall, the dollar spikes, and liquidity evaporates across speculative assets.
Crypto, unfortunately, sits at the very edge of that spectrum.
Within hours of such announcements:
- Bitcoin and Ethereum typically drop 2–3× more than the S&P 500.
- Open interest on futures markets collapses.
- Billions in leveraged long positions are liquidated.
- Volatility (realized and implied) explodes.
In our experience at Terramatris, the portfolio often suffers its sharpest daily drawdowns during tariff headlines — even though the crypto market has no direct link to steel, cars, or semiconductors.
This is purely a sentiment correlation effect: when traditional traders de-risk, they sell everything with volatility attached — and crypto is at the top of that list.
Why Crypto Reacts to Trade Policy at All
There are three main mechanisms behind this correlation:
Risk sentiment transfer
Crypto now trades as a global risk asset. Institutional money, macro funds, and retail traders all treat Bitcoin and Ethereum as high-beta plays on liquidity and optimism. When tariff news signals slower growth or global uncertainty, those positions are first to go.
Liquidity chain effect
Margin calls and equity losses force fund managers to raise cash elsewhere. Crypto holdings — especially on regulated platforms — are often liquidated to meet collateral needs.
Narrative contagion
Even if tariffs don’t touch crypto directly, the macro narrative shifts from “expansion” to “recession risk.” That shift compresses valuations across all risk assets. Algorithms trading cross-asset correlations simply follow the flow.
How Long It Usually Takes to Recover
Looking at previous episodes (2018 China tariffs, 2019 escalation, and smaller tariff scares since), crypto tends to follow a three-phase recovery pattern:
Shock & liquidation
1–3 days
Sharp 10–20 % drops, high funding rates reset, huge volumes
Relief rebound
3–10 days
Oversold bounce, short-covering, funding normalizes
Consolidation & rebuild
2–4 weeks
Range trading before resuming trend, often faster than equities
On average, major tariff-induced crypto crashes take about 2–4 weeks to fully recover, assuming no new escalation.
If tariffs deepen or retaliation follows, recovery can stretch to 6–8 weeks.
Interestingly, crypto often leads the recovery phase — once fear subsides, liquidity returns faster to Bitcoin than to equities. But timing it requires patience and strict risk control.
Our Experience: The March–April Drawdown and September Rebound
At Terramatris, we experienced a massive portfolio drop during the March–April 2025 correction, triggered by tariff fears and broader macro stress.
The portfolio lost a significant portion of value within days as leveraged long positions across exchanges were liquidated.
However, by staying disciplined — cutting leverage, keeping exposure manageable, and gradually rebuilding — the market fully recovered and went on to reach new all-time highs by September 2025.
That rebound reinforced a critical lesson:
Leverage is the biggest enemy during macro shocks.
Crypto’s volatility is already extreme; adding borrowed exposure magnifies losses exponentially.
Avoiding leverage — or using it sparingly and strategically — is the single best defense against panic-driven wipeouts.
Why Recovery Sometimes Doesn’t Come Quickly
There are reasons recovery may stall or fail entirely:
- Persistent macro fear: If tariffs escalate into a prolonged trade war, investor appetite for high-volatility assets stays low.
- Tight monetary policy: When interest rates remain high, liquidity to fuel speculative rallies dries up.
- Sentiment damage: Multiple shocks in a short period (tariffs + regulation + earnings misses) can exhaust dip buyers.
- Structural leverage wipeouts: After extreme liquidation events, traders need time to rebuild collateral and confidence.
In those cases, the crypto market may move sideways for months even if prices don’t collapse further.
Our Broader Takeaways
Through multiple tariff cycles, we’ve learned three rules that consistently protect capital:
- Keep leverage near zero when macro risk rises.
- Use volatility spikes to sell options or reposition, not to chase price.
- Expect crypto to bottom before equities — but only after forced liquidations clear.
These principles helped us navigate the March–April drawdown and come out stronger in September.
The Takeaway
Tariff announcements are a reminder that crypto is no longer an isolated niche — it’s part of the global macro risk web.
When traditional markets fear slower trade and tighter liquidity, Bitcoin bleeds with the rest of them.
But unlike industrial stocks, crypto tends to snap back faster, provided the policy shock fades instead of festers.
In other words:
“Tariffs don’t target crypto — but crypto still takes the bullet.”
For disciplined investors, that’s both a warning and an opportunity.
When the panic hits, manage risk. When the dust settles, be ready , because crypto rarely stays down for long.
Georgian Tax Residency: A Strategic Option for HNWIs and Crypto Individuals
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At Terramatris, we examine how funds and financial structures work across different jurisdictions. We don’t provide legal or tax advice, but we do explore how certain models stand out in the global landscape. One of the most compelling examples today is Georgia’s tax residency framework, which offers particular advantages to high-net-worth individuals (HNWIs) and crypto investors.
What Is Georgian Tax Residency?
The most common path is the 183-day rule:
- If you spend at least 183 days in Georgia during a rolling 12-month period, you qualify as a tax resident.
There is also a High Net Worth Individual (HNWI) track, where residency can be granted even without the 183 days, provided you can demonstrate certain global income or asset thresholds. This makes Georgia appealing to internationally mobile individuals who do not want to tie themselves down geographically.
The Georgian Revenue Service issues a tax residency certificate, which is critical for establishing Georgia as your tax home in the eyes of other jurisdictions.
Why It Matters for Individuals
Territorial Taxation
Georgia taxes only Georgian-sourced income. For HNWIs and crypto holders whose wealth is generated abroad (for example, from trading on international exchanges), this can dramatically reduce tax burdens.
Crypto-Friendly Environment
Georgia has signaled openness toward digital assets. While regulations are evolving, the environment remains relatively light compared to more restrictive countries.
Flat and Simple Personal Taxes
Georgian-sourced income is taxed at a flat 20%, while certain statuses (such as small business regime) can lower effective taxation significantly. For individuals with mixed income streams, the simplicity is attractive.
Wealth Protection & Lifestyle
Residency in Georgia offers more than taxes: low cost of living, access to banking, and a strategic location between Europe and Asia. For individuals seeking to diversify lifestyle and financial risk, this creates added resilience.
Potential Downsides to Consider
No jurisdiction is perfect. Before considering Georgian tax residency, individuals should be aware of the following limitations:
Changing Regulations
Georgia is still shaping its crypto policy and broader financial regulations. What looks advantageous today may be revised in the future as global standards tighten.
Perception of Tax Residency
Other countries may not automatically recognize Georgia as your main tax base if you maintain strong ties elsewhere (property, family, business). This can lead to dual-taxation disputes, especially with more aggressive tax authorities.
Banking & Financial Services
Although Georgia’s banking system is accessible, it is not as internationally integrated as Switzerland, Luxembourg, or Singapore. Large crypto-to-fiat transactions may attract scrutiny.
HNWI Track Limitations
Proving wealth or income for the HNWI residency track requires documentation and sometimes discretionary approval. It may not be as straightforward as the 183-day rule.
Reputation Risks
Some investors may view Georgia as an “emerging” jurisdiction rather than a fully established financial hub. This perception can matter when dealing with conservative institutions or international partners.
Relevance for Crypto Individuals
Unlike funds or firms — which we’ve discussed separately in our article on crypto fund structures and Georgia’s role — individual investors face different challenges. Residency and taxation directly impact how profits from trading, long-term holding, and portfolio rebalancing are treated.
For a crypto individual:
- Establishing Georgia as your primary tax residence can help avoid dual-taxation conflicts.
- Gains from foreign crypto trades may fall outside Georgian taxation under the territorial system.
- The HNWI track provides flexibility for those who prefer not to spend long periods in one country.
Important Caveat
As always, Terramatris emphasizes: we are not providing legal or tax advice. Each person must consult qualified advisors before acting. Our goal is to analyze global financial structures, and Georgia stands out as a particularly innovative jurisdiction for individuals navigating the complexities of crypto wealth.
For HNWIs and crypto individuals, Georgia offers a unique mix: territorial taxation, flexibility in residency options, and a crypto-friendly outlook. But with potential downsides — from regulatory changes to perception risks — careful planning is essential.
At Terramatris, we see the Georgian tax model as one of the most interesting cases globally, and one that deserves close attention from anyone serious about cross-border wealth and crypto management.
And for anyone going through the process, a great helper for tax document translations and notarization services is caucasustranslations.com.
Why Registering a Small Crypto Trading Firm in Georgia Makes Sense
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The global crypto market is becoming more institutionalized, and even small proprietary trading firms need to think about jurisdiction, compliance, and taxation. While the U.S. (Wyoming, Delaware) and offshore hubs (BVI, Seychelles) remain popular, Georgia, the country in the Caucasus,has quietly emerged as an attractive option for crypto-friendly businesses.
Below, we’ll explore why Georgia might make sense for a small crypto trading firm, what the registration process looks like, and the pros and considerations you should keep in mind.
Why Georgia?
Crypto-friendly environment: Georgia does not have hostile legislation toward crypto. Trading, investing, and holding digital assets is not restricted for companies or individuals.
Low taxes: Georgia applies an Estonian-style corporate tax model — you only pay corporate tax (15%) when distributing profits as dividends. Reinvested earnings are tax-free. For small businesses, a turnover tax regime exists with just 1% tax on revenue if annual turnover is under GEL 500,000 (~USD 180,000).
Banking access: Unlike some offshore jurisdictions, Georgian banks (TBC, Bank of Georgia) are relatively open to fintech and international clients.
Ease of incorporation: An LLC can be registered in a few days. Remote registration is possible through a power of attorney.
Steps to Register a Trading Firm in Georgia
Incorporation
- File Articles of Association and register with the National Agency of Public Registry.
- Typical turnaround: 1–2 business days.
Tax ID & VAT Status
- Obtain a tax identification number.
- For small trading firms, VAT may not be required, but it depends on your turnover and activities.
Bank Account
- Open a corporate account at a Georgian bank (TBC, Bank of Georgia).
- Alternatively, apply to fintech solutions like Wise or Payoneer for global transfers.
Exchange Accounts (Corporate KYB)
- Exchanges like Bybit and Deribit allow corporate accounts.
- Provide incorporation docs, tax ID, and proof of ownership.
Compliance & Reporting
- Maintain accounting records.
- File annual reports; tax only applies when distributing profits.
Tax Advantages
Reinvestment Freedom: Retained earnings are tax-free until distributed. Perfect for proprietary firms reinvesting in crypto.
Small Business Regime: Under GEL 500,000 turnover, pay 1% turnover tax instead of standard rates.
Dividend Withholding Tax: When distributing profits, an additional 5% applies, making the effective tax burden about 20% — still competitive globally.
Considerations and Challenges
Enhanced banking oversight: Financial institutions in Georgia, like in many jurisdictions, apply rigorous due diligence for companies engaged in digital assets. Firms should be prepared to provide clear documentation and transparency in operations.
Evolving regulatory framework: While crypto activity is currently accommodated within existing structures, digital asset regulation worldwide continues to develop. Firms should anticipate potential adjustments and align with international compliance standards.
Operational requirements: Maintaining proper accounting, local reporting, and engaging qualified advisors is essential for full compliance and efficient tax planning.
For a small proprietary crypto trading firm, Georgia offers a combination of low taxation, ease of registration, and access to international banking that few jurisdictions can match. It is particularly compelling for firms reinvesting profits into spot crypto rather than distributing dividends frequently.
Important Note: We are not offering legal, tax, or incorporation services in Georgia. This article is for informational purposes only. However, if you are considering setting up a small trading firm and would like to have a meaningful conversation about structuring, strategy, and practical experiences, we would be open to a discussion.
Discovering Derive: Our First Steps into True DEX Options Trading
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At Terramatris, we’ve always been fascinated by the evolution of crypto markets and the growing range of opportunities they create for traders and investors. For years, our main focus has been on more traditional centralized exchanges (CEX) such as Bybit and Deribit. These platforms have provided liquidity, stability, and advanced trading features—making them indispensable for our operations.
But one thing has always been missing: a true decentralized exchange (DEX) for options trading.
Recently, while researching potential institutional partners for our US operations (Kraken), we stumbled upon Derive, a DEX options trading platform. If liquidity and market makers keep growing, Derive has the potential to become a central piece in the future of decentralized derivatives trading.
Why Derive Matters
Decentralized trading isn’t just about ideology—it’s about resilience, accessibility, and innovation. While we still rely heavily on CEXs for their speed and liquidity, a truly functioning DEX fills a crucial gap. Derive does just that.
At the moment, Derive supports BTC and ETH options trading. Naturally, we would love to see Solana integrated in the future, especially since we’re actively running our Solana Covered Call Growth Fund. But even without Solana, having BTC and ETH live on a fully decentralized platform is an exciting step forward.
The fee structure is another point of interest. On first glance, trading fees seem higher compared to centralized competitors like Bybit or Deribit. However, Derive’s native token (DRV) plays an important role. Traders receive partial refunds in DRV, effectively cutting fees in half. For us, this means not only do we get exposure to a new instrument (DEX options), but we also add a new token to our portfolio. We see this as a learning opportunity, and we’re happy to take a small position as we continue exploring the ecosystem.
Who’s Behind Derive?
As we dug deeper, we learned that Derive is backed by the Lyra Foundation, a team known for pioneering decentralized derivatives. While our knowledge so far only scratches the surface, we feel increasingly confident about their vision and execution. It’s rare to find a DEX team that has both the technical expertise and the financial infrastructure to compete with established CEXs.
Our philosophy at Terramatris has always been simple: we like to put our money where our mouth is. That’s why, even at this early stage, we’re committing a small portion of our portfolio to Derive.
How It Works in Practice
Getting started on Derive was straightforward but requires some familiarity with DeFi tools. Here’s how we approached it:
- Wallet Setup – Derive connects through MetaMask, making onboarding seamless for anyone already using DeFi applications.
- Network Choice – We opted for the Arbitrum network, which offered us lower fees and reliable transaction speeds.
- Funding the Account – We deposited USDC and ETH into our wallet on Arbitrum, ensuring we had both stable collateral and trading capital.
- First Trade – To test the waters, we opened a 0.1 ETH put contract. This small initial trade is our way of learning the platform mechanics while limiting risk exposure.
So far, the process has been smooth, and the interface feels intuitive compared to other DEX platforms we’ve tested in the past.
Our First Impressions
- Accessibility: The MetaMask integration is seamless, making it easy for anyone with a Web3 wallet to get started.
- Transparency: No KYC requirements keep the platform true to the spirit of DeFi. But that might be challenging in the future.
- Innovation: The DRV token and fee refund system provide an interesting incentive model, even if it’s something we’re still learning about.
- Potential: If Derive manages to attract enough liquidity, it could become a serious competitor to the established CEXs.
For us, Derive represents more than just another trading platform—it’s a proof of concept that decentralized options trading can work. While we still rely on centralized exchanges for the majority of our trading activity, having a DEX option is something we’ve been waiting for.
We are genuinely excited about this development. Even though our current position is small, it feels like the beginning of something important. In the future, we would love to see Solana integrated, which would align perfectly with our existing strategies.
For now, Derive has already earned a spot in our portfolio and in our watchlist. It’s rare that we come across something that feels both innovative and practical—but Derive checks both boxes.
As always, we’ll continue to share our journey and learnings with our community. If you’re curious about decentralized options trading, we encourage you to give Derive a try—all you need is MetaMask and some ETH.
Why We Decided Not Yet to Tokenize Our Solana Covered Call Fund
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When we launched the Solana Covered Call Growth fund, one of the exciting questions on the table was tokenization. The idea of creating a fully on-chain, tokenized representation of fund shares is appealing: transparency, liquidity, and a modern Web3-native structure. However, after careful consideration, we decided not to tokenize—at least not yet.
We are still in the early stages of building and refining this strategy. At this stage, our focus is on performance, repeatability, and reporting, rather than infrastructure. Tokenization can add a layer of complexity—both technical and regulatory—that distracts from the main goal: executing our options strategy consistently and profitably.
We did explore how tokenization could work in practice. For example, we spent several hours testing with Squads, one of the best DAO and treasury tools on Solana. The experience confirmed that while the tech is powerful, it also requires commitment to developer resources, maintenance, and onboarding—all of which might be premature for us.
Instead of rushing into tokenization, we decided to stick with a more traditional approach for now:
- Personal, direct NAV reporting to our investors.
- Simple and clear communication about fund performance.
- Avoiding overhead and not burning resources on developer teams.
This also aligns with our lean early-stage philosophy: we want to deploy capital efficiently, not on infrastructure we may not yet need.
What excites us is that we can already operate efficiently and transparently without heavy dev costs. Tools like ChatGPT help us with reporting, automation, and investor communication. This allows us to move fast, keep costs low, and focus on strategy execution.
Our decision is not a rejection of tokenization. We see clear benefits in the long run, and tokenization will likely play a role in the future of this fund. But timing matters. For now, we’re confident that a personal, streamlined, and cost-effective approach best serves our investors.
In short: we chose to walk before we run. Tokenization remains on the horizon, but today our energy is better spent on building trust, delivering returns, and refining our core process.
Delta-Neutral Arbitrage in Crypto: Inside Terramatris Solana Strategy
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At Terramatris, we are still an early-stage crypto hedge fund. Our core strategy leans toward directional exposure—going long on assets we believe in and applying quantitative options strategies to generate income. Specifically, we sell puts and calls on assets like Ethereum and Solana, capturing option premiums while managing risk.
This allows us to grow the fund more aggressively, as we participate directly in upside movements while securing steady cash flow from option sales.
However, as outside capital gradually flows into the fund, we are also introducing arbitrage strategies alongside our directional and options trades. These arbitrage trades are not designed to rapidly grow a small fund, but they add balance, protection, and consistency to our overall portfolio.
Why Arbitrage Matters
Arbitrage trades offer a delta-neutral position, meaning the overall market direction doesn’t affect the outcome. Instead, returns are locked in by capturing spreads between different markets or instruments. While these trades may seem modest in terms of short-term profit, they provide peace of mind and stability for investors who value risk-adjusted returns over volatility.
From a more classical investment perspective, arbitrage can be very lucrative. Some of our strategies—like those in Solana markets—can reach annualized yields of around 9%, which is a strong, consistent return profile compared to many traditional asset classes.
Our Preferred Arbitrage Trade: Solana Spot vs. Futures
One specific trade we enjoy is:
- Long spot SOL (holding Solana directly)
- Shorting Solana futures with a set expiry
This structure allows us to lock in the spread between spot and futures prices, effectively hedging away price movements while securing a predictable yield.
Such trades don’t move the needle much when working with small amounts of capital, but with larger inflows they become a reliable way to enhance the fund’s stability and protect against sharp market swings.
Where We Use These Trades
Currently, arbitrage plays an important role in our Solana Covered Call Growth Fund, where they complement both our long positions and our quantitative options strategies. Looking ahead, we may consider launching a dedicated arbitrage fund. However, that approach would be more capital-intensive—since arbitrage yields scale best with size—and at this stage, our focus is still on growing assets under management.
Conclusion
At Terramatris, we believe in combining growth-oriented directional trades, quantitative options strategies, and risk-managed arbitrage trades. This blended approach allows us to capture market upside while offering investors stability and reliable returns. As our fund grows, we expect arbitrage to play an even more prominent role, potentially shaping entire fund structures dedicated to such strategies.
Wishful Thinking, Statistics, and Modeling: Where Could Terramatris Fund Be in September 2026?
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On September 2, 2025, the Terramatris crypto hedge fund stands at $10,500. Out of this, roughly $3,500 is low-interest debt, which we are steadily repaying at a rate of $300–450 per month. If nothing changes, we expect to be debt-free by April 2026. Importantly, there is no real pressure to return these funds quickly; and if market conditions turn against us, we believe we could borrow back on similar terms without risk to the core strategy.
This puts Terramatris in a comfortable position: a five-figure portfolio, a clear debt-repayment path, and a robust options premium strategy that has been delivering consistent weekly returns.
The Options Premium Engine
Our core edge comes from selling weekly options—primarily covered calls and short puts.
- Base case (regular weeks): $150 income
- High case (end-of-month weeks): $300 income
This structure mirrors what we saw in August 2025, when August 29 delivered an all-time high $580 in weekly option premium. While that was above our base projections, it demonstrates the upside potential of our systematic approach.
Statistically, this creates a 3–4 regular weeks per month followed by 1 boosted week model. The stability of this rhythm is what makes our growth projections meaningful.
Modeling Forward: A 10% Monthly Growth Scenario
For the year ahead, we assume that options income grows at 10% per month. This is a form of wishful thinking grounded in compounding mathematics:
- Start: September 2025 with $150 regular weeks, $300 high weeks
- Growth: +10% per month on both income types
- Horizon: 12 months (September 2025 – August 2026)
Using this model with the actual Friday distribution, Terramatris is projected to generate about:
- $17,133 total in options premiums from Sept 2025 → Aug 2026.
This compares to $9,600 in a linear, no-growth scenario—showing how much impact compounding can have if we keep executing consistently.
Fund Value by September 2026
Let’s combine these flows:
- Starting value (Sept 2025): $10,500
- Debt repayment by April 2026: ~($3,500) returned gradually
- Options income (1 year): +$17,133
If all premiums are reinvested and debt fully cleared by spring, the fund value in September 2026 could stand around $24,000.
That’s more than +128% growth year-over-year. Even with more conservative assumptions (say 5–6% monthly growth, or stagnant summer markets), the projection shows healthy double-digit compounding.
The TerraM Token Effect
The TerraM token is designed to reflect the performance and value of the Terramatris fund. If the fund nearly doubles in size, the token’s intrinsic backing strengthens:
- More collateral per token
- More confidence in future buybacks and liquidity
- Stronger long-term sustainability
While the crypto markets are volatile and nothing is guaranteed, a growing base fund value directly improves the TerraM token’s story. It makes the token not just a speculative asset, but a reflection of real trading income.
A Note on Wishful Thinking
All projections are based on statistics and models. Reality can diverge:
- Option premiums may dip in quiet months
- Market drawdowns may force adjustments
- Growth may not compound as neatly as modeled
That’s why we emphasize monthly reviews. Each month, we can re-test assumptions and adjust premium targets. But as a starting point, the 10% growth model provides a compelling roadmap of what’s possible.
Conclusion
By September 2026, if Terramatris executes consistently, clears its small debt, and keeps compounding weekly premiums, we could be looking at a fund size above $24,000. The journey from a $10,500 base to this level in 12 months shows how disciplined option selling and compounding growth can transform a small fund into a serious player.
Wishful thinking? Perhaps. But with math, modeling, and momentum on our side, it’s a future worth striving for.
Snipping in DeFi: Tempting, But Not Sustainable
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At Terramatris, we constantly evaluate emerging strategies in the decentralized finance (DeFi) landscape — especially those that promise asymmetric upside. One such tactic is snipping (or sniping), a method that’s gained attention for its high-speed, high-risk approach to token trading.
We want to offer a clear and honest take: while snipping can be entertaining and, in rare cases, wildly profitable, it doesn’t align with our long-term trading philosophy.
What Is Snipping in DeFi?
Snipping refers to the practice of purchasing newly launched tokens at the exact moment liquidity is added to decentralized exchanges (DEXs) like Uniswap or Raydium. Traders — typically using bots — aim to front-run others by getting in before a price surge and exiting moments later with a quick profit.
Snipping usually involves:
- Monitoring new token pair creations.
- Using bots or scripts to submit early, pre-signed transactions.
- Bidding higher gas prices to outpace competitors.
Our Exploration: Interesting, but Not Convincing
To be clear — we have not run any snipping bots ourselves, nor have we deployed capital into active sniping strategies.
However, we’ve explored several publicly available bots, platforms, and tactics. We’ve analyzed codebases, reviewed community feedback, and simulated edge-case scenarios.
Our conclusion?
It’s more fun than it is sustainable.
Snipping appears built for adrenaline, not for stable growth. The field is littered with failed attempts, honeypots, blacklisted contracts, and high gas loss ratios.
It’s difficult to repeat. Impossible to scale. And often too dangerous to justify.
Raydium, Solana & Our Token
Our own Terramatris Token (TERRAM) is live on the Solana blockchain, and available for trading on the Raydium Automated Market Maker (AMM).
Raydium has recently gained significant popularity as the go-to platform for launching new Solana-based tokens — largely because of ultra-low transaction fees and a frictionless developer experience. These advantages have also made Raydium a hotspot for sniping bots, especially during new token launches.
Why We’re Not Betting on It
While we don’t discount the possibility that some early snipers made big returns — especially in the initial DeFi waves — we see too many red flags to consider it a long-term, fund-worthy strategy.
Key Risks We Identified:
- Bot saturation: Millisecond-level races lead to heavy failure rates.
- Anti-bot protections: Contract-level blacklists and honeypots are now common.
- MEV and sandwich attacks: Snipers often become prey to more sophisticated bots.
- Gas loss risk: Even with Solana’s cheap fees, failed transactions can stack up.
- Lack of compounding potential: There’s no reinvestment path or yield growth.
Our Focus at Terramatris
We build the fund around repeatable, risk-adjusted, and scalable strategies.
Our core areas include:
- Directional Trading: Long and short exposure to top crypto assets based on macro signals, trend shifts, and volatility regimes.
- Options-Based Yield:
- Selling cash-secured puts to acquire assets at discounts.
- Writing covered calls to generate income against spot holdings.
- Capital-Efficient Management: Managing margin, risk, and opportunity cost is central to our execution model.
We’re not looking to “get lucky” — we’re here to compound strategically.
Final Word
Snipping in DeFi is flashy. It’s technical. It can be fun. But from our perspective — as traders aiming for consistency, not chaos — it doesn’t pass the sustainability test.
We’re not entirely dismissing it. There may be niche opportunities for those with custom infrastructure, deep code understanding, and fast relayer access. And yes, some early adopters did make it big.
But for us at Terramatris, this isn’t a strategy we stake capital on.
We’d rather play the long game — with options, structure, and discipline.