Bitcoin (CRYPTO: BTC) remains under pressure, but FalconX Head of Trading Strategy Hassan Baseri says institutional traders are increasingly looking at Ethereum (CRYPTO: ETH) and Hyperliquid (CRYPTO: HYPE) as higher-conviction opportunities.

What Happened

Speaking on June 18 on the Milk Road Show, Baseri highlighted the dominant trade among institutional clients has been "short crypto, long AI," as artificial intelligence stocks continue absorbing market attention and capital.

However, within crypto, Baseri said traders are watching Ethereum and Hyperliquid closely, while Bitcoin remains clouded by concerns around Michael Saylor's Strategy (NASDAQ:MSTR) and its preferred instruments.

He added that traders fear the market may test Saylor's willingness to sell Bitcoin to support Strategy's credit structure, particularly its preferred stock, Stretch.

"People are not buying because they're looking at what's going to happen with Saylor," Baseri said.

He also warned that U.S. midterm elections could become a major risk if Democrats gain ground and slow or reverse crypto-friendly regulatory momentum.

He argued Bitcoin may need to retest the $55,000 area before confidence returns, especially if Strategy sells some Bitcoin to bolster reserves and calm fears around its dividend obligations.

Ethereum, Hyperliquid In Focus

Baseri said several FalconX clients are expressing bullish views on Ethereum through derivatives, including risk-reversal trades that involve selling downside puts and buying upside calls.

He noted Ethereum has historically seen long periods of weak price action, but "when it does rally, it will be very violent".

Hyperliquid is also drawing strong institutional interest, according to Baseri, who said the market trusts the project's team to protect token value through fee buybacks and disciplined ecosystem development.

He said Hyperliquid's ability to support trading in pre-IPO assets such as SpaceX, Anthropic and OpenAI could keep demand strong.

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