Jack Kubinec 

Mert Mumtaz

Jeffrey Albus

The essential source for all things Solana — exclusive news, deep analysis, and the latest trends.

Lightspeed

(00:00) Introduction
(01:24) Solana’s Bug Fix
(13:00) Ledger Ad
(13:45) Ethereum’s Big Pivot
(19:18) Can Ethereum Scale The L1?
(28:49) Ledger Ad
(29:34) Solana’s DEX Landscape
(40:48) The Most Performant L1 Will Be The Most Decentralized

LS186

Gm! This week we're joined by Thomas Uhm to discuss his journey to joining Jito. We deep dive into the institutional demand for crypto, treasury companies vs ETFs, crypto's market making problem &amp; more. Enjoy!
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Follow Thomas: https://x.com/ThomasUhm
Follow Jack: https://x.com/whosknave
Follow Lightspeed: https://twitter.com/Lightspeedpodhq
Subscribe to the Lightspeed Newsletter: https://blockworks.co/newsletter/lightspeed
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Zenrock is a permissionless, decentralized custody network backed by 1RoundTable Partners, 10T, Maven11, and Spartan. Live on Jupiter, $ROCK is the native token for transactions within the Zenrock ecosystem and secures Zenrock’s decentralized custody network.

The first application launching on Zenrock is zenBTC – yield-bearing Bitcoin on Solana. zenBTC will be live in April 2025. Visit zenbtc.io to learn about earning yield with Bitcoin on Solana.
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Grab your tickets to Permissionless IV. Use code LIGHTSPEED10 for 10% off: https://blockworks.co/event/permissionless-iv
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Get top market insights and the latest in crypto news. Subscribe to Blockworks Daily Newsletter: https://blockworks.co/newsletter/
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(00:00) Introduction
(04:45) Institutional Demand For Jito
(12:56) Zenrock Ad
(13:40) How Does Jito Capture Value?
(21:28) Solana Treasury Companies vs ETFs
(25:00) Zenrock Ad
(25:44) The Investment Thesis For Solana
(37:09) Crypto’s Market Making Problem
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Disclaimers: Lightspeed was kickstarted by a grant from the Solana Foundation.

Nothing said on Lightspeed is a recommendation to buy or sell securities or tokens. This podcast is for informational purposes only, and any views expressed by anyone on the show are solely our opinions, not financial advice. Mert, Jack, and our guests may hold positions in the companies, funds, or projects discussed.

Ex Jane Street Veteran's Journey To Crypto | Thomas Uhm

Gm! This week we're joined by Kash Dhanda to discuss the end game for Jupiter. We deep dive into building crypto's DeFi super-app, Jupiter's revenue breakdown, Solana vs app revenue, what's next for Jupiter &amp; more. Enjoy!
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Subscribe to the Lightspeed Newsletter: https://blockworks.co/newsletter/lightspeed
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Ledger, the global leader in digital asset security, proudly sponsors the Lightspeed podcast. As Ledger celebrates 10 years of securing 20% of global crypto, it remains the top choice for securing your Solana assets. Buy a LEDGER™ device now and build confidently, knowing your SOL are safe.Buy now on https://shop.ledger.com/?r=1da180a5de00.
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Grab your tickets to Permissionless IV. Use code LIGHTSPEED10 for 10% off: https://blockworks.co/event/permissionless-iv
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Get top market insights and the latest in crypto news. Subscribe to Blockworks Daily Newsletter: https://blockworks.co/newsletter/
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(00:00) Introduction 
(01:26) The Jupiter End Game 
(07:40) Growing Market Share 
(12:02) Ledger Ad 
(12:48) Jupiter’s Revenue Breakdown 
(21:46) Does Jupiter Have A Moat? 
(24:52) Is The AMM Model Doomed? 
(30:40) Ledger Ad 
(31:26) Solana vs App Revenue 
(37:54) The JUP Token 
--
Disclaimers: Lightspeed was kickstarted by a grant from the Solana Foundation.

Nothing said on Lightspeed is a recommendation to buy or sell securities or tokens. This podcast is for informational purposes only, and any views expressed by anyone on the show are solely our opinions, not financial advice. Mert, Jack, and our guests may hold positions in the companies, funds, or projects discussed.

Solana's DeFi Super App: The Jupiter End Game | Kash Dhanda

Jack Kubinec

This is a segment from the Lightspeed newsletter. To read full editions, <a href="https://blockworks.co/newsletter/lightspeed" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Superstate, the tokenization startup co-founded by DeFi OG Robert Leshner, announced a new stock tokenization product on Solana and Ethereum this morning.



Named “Opening Bell,” the platform allows companies to natively issue shares onchain — a notable innovation for tokenized public equities. The Solana-focused holding company <a href="https://blockworks.co/news/sol-strategies-is-solanas-microstrategy">Sol Strategies</a> became the platform’s first participant.



Many in Solana were quick to celebrate the news, because in its early days, Solana co-founder Anatoly Yakovenko would sometimes <a href="https://cointelegraph.com/news/solana-genesis-story-powering-nasdaq-on-public-blockchain">liken</a> the network to Nasdaq on the blockchain. Today, Yakovenko penned a rare blog post alongside Anza lead economist Max Resnick <a href="https://www.anza.xyz/blog/the-path-to-decentralized-nasdaq">outlining</a> how Solana’s path to creating a decentralized Nasdaq runs through the implementation of multiple concurrent leaders, where different validators can create blocks at the same time.&nbsp;&nbsp;&nbsp;



The concept of tokenized stocks isn’t new: I could give you a token in exchange for your Tesla stock, and there it is. Besides potential regulatory red flags, the issue with this kind of thing is that your token would trade in a less-liquid environment than the original stock did. If you tried trading it on DEXs, you could get stuck with stale prices compared to what’s available on stock exchanges.



What seems to set Superstate apart is its SEC-registered transfer <a href="https://superstate.com/blog/superstate-transfer-agent-registration">agent</a> that performs the issuance and redemption of shares or dividends on behalf of companies. Onchain equity issued this way can move around the world more efficiently, and maybe even be used as collateral in DeFi. Users must go through KYC checks before accessing shares on Opening Bell.



Superstate <a href="https://superstate.com/blog/introducing-opening-bell">points</a> out another interesting use case: “up-listing,” whereby non-public companies can issue shares on a crypto-native market before trying to achieve listing on the Nasdaq or NYSE. In a Telegram message, Leshner told me Superstate can’t make it easier for companies to go public, but he believes that the “up-listing” process will become popular nonetheless.&nbsp;



To see why this may be the case, consider a hypothetical: Sol Strategies is currently awaiting approval to trade on the Nasdaq. If its shares gin up a lot of interest on Opening Bell, perhaps that could make regulators more assured in approving and investment bankers more excited about underwriting US-based Sol Strategies stock.&nbsp;



“[We’re] proud to be the first public company working hard to take this step,” Sol Strategies CEO Leah Wald said. “Tokenizing shares is more than a technology upgrade — it’s about aligning with the next generation of market infrastructure and investor expectations.”



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<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: Unpacking crypto and the markets.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

Anatoly Yakovenko

‘Nasdaq on Solana’ vision sees progress with Opening Bell launch

Jeff Albus

This is a segment from the Lightspeed newsletter. To read full editions, <a href="https://blockworks.co/newsletter/lightspeed" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Have you ever wondered why stock trades take days to settle? Have you ever looked at the UX nightmare that is fractional ownership and thought, How in the world is this still the norm? And why is it exactly that your shares must live inside custodial black boxes?



These design failures boil down to the fact that the US equity market is fundamentally outdated. It&#8217;s <a href="https://ir.nasdaq.com/news-releases/news-release-details/nasdaq-study-shows-legacy-technology-and-regulation-preventing">trapped</a> inside legacy infrastructure, shackled by intermediaries and probably <a href="https://www.zdnet.com/article/if-cobol-is-so-problematic-why-does-the-us-government-still-use-it/">coded</a> in COBOL.



Efforts to modernize the system are usually surface-level. We might get faster messaging or marginally updated interfaces, but the core always seems to remain untouched. Hence, we live in a holding pattern of settlement delays, bloated fees and an ecosystem that is as opaque as it is exclusionary.



Enter Project Open, a <a href="https://www.sec.gov/files/ctf-written-project-open-wireframe-04282025.pdf">newly submitted SEC pilot proposal</a> with blockchain at its core. Jointly proposed by the Solana Policy Institute, Superstate and Orca (and with legal support from Lowenstein Sandler), Project Open is a <a href="https://x.com/SolanaInstitute/status/1917650618677686764">request</a> for exemptive relief that would allow equity securities to be issued, registered and traded directly on public blockchain networks like Solana.



The Solana Policy Institute, which <a href="https://www.solanapolicyinstitute.org/blog/announcing-the-launch-of-solana-policy-institute">launched</a> at the end of March, is a non-partisan advocacy group <a href="https://blockworks.co/news/solana-policy-institute-ceos-political">aiming to help policymakers</a> understand the role public blockchains can play in economic and social infrastructure. Project Open is its first major public action.



The group <a href="https://www.sec.gov/files/ctf-written-project-open-wireframe-04282025.pdf">submitted</a> a 20+ page legal framework to the SEC&#8217;s <a href="https://blockworks.co/news/sec-new-crypto-task-force">crypto task force</a> this week, complete with registration pathways, KYC onboarding, smart contract-based settlement, investor education modules and blockchain-native transfer agent roles.



Issuers would file traditional-style registration statements, which is same-same with how we do things now. The main difference involves using a digital token class instead of paper shares. Transactions would settle instantly, wallet-to-wallet, onchain.



Project Open takes a head-on approach to compliance, proposing a pilot program with a gated issuer cohort, 18-month duration and SEC oversight baked in.



Investors would hold &#8220;Token Shares&#8221; in whitelisted wallets after passing KYC and educational onboarding. A registered transfer agent would track all shares using the blockchain as the system of record, with super-admin rights to fix errors, recover assets or enforce restrictions. No custodians. There wouldn&#8217;t be any net settlement. No post-trade ambiguity. Just delicious, deterministic finality.



Project Open proposes trading on rails using smart contracts (a la Orca AMM or bilateral P2P swaps) rather than traditional exchanges. The filing even outlines how tokenized trading mechanisms would navigate existing rules like Reg NMS and broker-dealer custody requirements — or bypass them via targeted exemptions.



It&#8217;s frankly an opportune time for this proposal to land, what with <a href="https://blockworks.co/news/gary-gensler-resigning">Gary Gensler out</a>, the subsequent <a href="https://blockworks.co/news/sec-potential-shift-enforcement-actions">rollback of enforcement actions</a>, and new SEC Chair Paul Atkins <a href="https://blockworks.co/news/sec-chair-nominee-crypto-past">signaling</a> openness to &#8220;huge benefits&#8221; from blockchain infra.



We&#8217;ve heard a similar song a lot lately. In his investor letter last month, BlackRock CEO Larry Fink <a href="https://www.blackrock.com/corporate/investor-relations/larry-fink-annual-chairmans-letter">said plainly</a>:



&#8220;Every stock, every bond, every fund — every asset — can be tokenized. If they are, it will revolutionize investing. Markets wouldn&#8217;t need to close. Transactions that currently take days would clear in seconds. And billions of dollars currently immobilized by settlement delays could be reinvested immediately back into the economy, generating more growth.&#8221;



If he&#8217;s right, then Project Open may be the first serious attempt to give that future a regulatory foundation in the US.



The goal is for internet capital markets to settle in seconds, run on open infrastructure, and restore user-level control. Faster, fairer, cheaper, smarter, with the opacity dial thinned to nil.



Project Open reads like the culmination of years of onchain trial and error. It&#8217;s the sober recognition that blockchain tech is ready for real finance, not just DeFi.&nbsp;



If the SEC says yes, even conditionally, it would be a meaningful convergence of TradFi and crypto — on the scale of ETFs, and just as important as tokenized Treasurys onchain.&nbsp;



If it says no, the status quo holds&#8230;for a little longer, anyway.



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<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: Unpacking crypto and the markets.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

Lightspeed Newsletter

Project Open makes its case to the SEC

This is a segment from the Lightspeed newsletter. To read full editions, <a href="https://blockworks.co/newsletter/lightspeed" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Over the past few months, people involved in Solana DeFi have been asking questions about SolFi, a DEX that sprang up in November and almost immediately captured over 20% market share on swaps between stablecoins and SOL.



SolFi was able to quote better prices than competitors, but at least one business partner I spoke to didn’t know who was behind the new exchange before today. In general, few seemed to be in the loop as to how SolFi was achieving such good prices.



Today, Ellipsis Labs — a DeFi shop currently building an Ethereum layer-2 that uses Solana’s software called Atlas — publicly claimed credit for developing SolFi.&nbsp;



In an announcement on X, Ellipsis Labs co-founder Eugene Chen said the DEX “came from our deep understanding of the market structure on Solana.” Prior to building Atlas, Ellipsis created an orderbook Solana DEX called Phoenix.&nbsp;



SolFi has no frontend, but Chen added that the DEX had partnered with Jupiter Exchange to bring the product to retail traders. SolFi is one of 51 DEXs that are part of Jupiter’s swap aggregator, but it currently makes up for 25% of Jupiter volume — far more than any other DEX — according to a Dune <a href="https://dune.com/ilemi/jupiter-aggregator-solana">dashboard</a>.&nbsp;



The Solana rumor mill tended to reason that SolFi’s creators had to be someone with roots in the network, and Ellipsis certainly seems to have the technical chops to fit the bill.



“The Ellipsis Labs team are some of the most talented SVM developers in the ecosystem. It should be no surprise, given what they’ve built with Phoenix and Atlas, that they’ve also been able to find success with SolFi,” Switchboard co-founder Chris Hermida said.



SolFi isn’t the only anonymous Solana DEX. Orbic and ZeroFi are other newer Solana DEXs that have commanded significant trading volumes without publicly disclosing who their developers are.



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<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
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DEXs

Ellipsis Labs claims credit for mysterious top Solana DEX

This is a segment from the Lightspeed newsletter. To read full editions, <a href="https://blockworks.co/newsletter/lightspeed" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Solana is stalled sideways, with the broader crypto market hitting some light turbulence. SOL is trading at $145.45 midweek, down 2.5% from last Wednesday and now drifting crabwise after a month-long rally that pushed it up nearly 30% from April lows.&nbsp;



Despite the modest cooling of momentum, Solana <a href="https://app.blockworksresearch.com/assets/sol?tags=sol&amp;interval=1w">continues</a> to print usage at speed. Over the past 30 days, transaction fees have hit an annualized $432.9 million, with SOL burn running at an annualized $216.5 million pace.



Besides macro headwinds, we can probably trace some of the cautious price action to the looming FTX liquidation, where over 60% of the estate&#8217;s onchain assets are in SOL. The first wave of creditor repayments is scheduled for May 30 — funded by prior asset sales, including FTX’s March SOL deals — which may still weigh on sentiment even if the tokens themselves are no longer in play. SOL&#8217;s market cap has slipped to $75.3 billion, and while 24-hour volume remains strong at $3.49 billion, buyers can&#8217;t seem to stop peeking over their shoulders.



The last round of FTX estate unlocks <a href="https://blockworks.co/news/sol-investors-shrug-off-unlocks">kicked off March 1</a> — right before a drawdown in SOL’s price, although there were obviously <a href="https://blockworks.co/news/tariff-fears-wipe-out-sol-gains">other factors involved</a>.&nbsp;



Bitcoin, meanwhile, had a little gut punch this morning due to macro. On Wednesday, BTC <a href="https://blockworks.co/price/btc">dropped</a> to $92,910 after US GDP data showed a <a href="https://forward-guidance.beehiiv.com/p/greatly-disappointing-print">0.3% contraction in Q1</a> — its first in three years. Analysts were quick to cite the sudden impact of Trump&#8217;s revived tariff policy, with imports surging and dragging down the GDP print. Stocks sold off, recession chatter kicked up, and bitcoin dipped. As is tradition, the price rebounded within hours to $94,000, buoyed by strong spot demand and resilient ETF inflows, including over $3 billion in net new capital through April 29.&nbsp;



Last weekend&#8217;s <a href="https://blockworks.co/news/crypto-solana-community-istanbul-turkey-conference">Crossroads event in Istanbul</a> allowed the Solana community to take stock of direction. It was a lot of builders comparing notes, investors checking pulse, and variant teams workshopping infrastructure that still has a shot at scaling mainstream demand — lots of honest conversations about payments, gaming, DePIN and the gaps that still need filling.



So far, though, the resulting confidence of those discussions has not translated into price. For now, conviction is expensive. The market is still frozen by what-ifs. What if the market prices in the FTX overhang? What if bitcoin fails to clear $96K and drags everything else with it? What if global retaliation hits US tech exports, and risk assets feel the heat?&nbsp;



Once these questions have answers, folks will either step up or step aside. And that&#8217;s when the market&#8217;ll start moving again&#8230;ready or not.



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<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: Unpacking crypto and the markets.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

FTX repayments loom over Solana

This is a segment from the Lightspeed newsletter. To read full editions, <a href="https://blockworks.co/newsletter/lightspeed" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Throughout much of the memecoin-fueled boom in Solana application revenue, the leaderboard has looked like this: pump.fun, Phantom, and an established group of so-called trading bots.&nbsp;



That stasis broke in recent weeks as a new competitor quietly climbed the ranks. Axiom, an online trading platform combining trading bot capabilities with Hyperliquid’s perpetual futures product, is now solidly in second place behind pump.fun in terms of Solana app revenue.



Last week, pump.fun saw $12.2 million in revenue, while Axiom was close behind with around $10.5 million, according to Blockworks Research. Phantom, with around $4.3 million, was a semi-distant third.&nbsp;



Axiom was co-founded by a pair of 22-year-old UC San Diego graduates, Henry Zhang and Preston Ellis. The computer science majors “had nothing really to do” in college, but they were both into crypto trading, so they built a couple of projects in their free time, Zhang told me.&nbsp;



Ellis was finishing up college, and Zhang was just starting as a software engineer at TikTok when the <a href="https://blockworks.co/news/solana-memecoins-all-time-high">Solana memecoin craze</a> began taking off. The pair decided to try building a platform that could rival the trading bot of choice, Photon. They built an initial product in mid-2024 and were selected into the winter batch for Y Combinator, the prestigious startup accelerator that counts Airbnb, Coinbase and Reddit as alumni. Zhang and Ellis said Y Combinator connected them with Jordan Fish, the crypto entrepreneur and online personality known as Cobie on X, who offered them advice — including that they should avoid opening up the checkbook for key opinion leaders (KOLs).



Trading bots are kind of like souped-up DEX aggregators that specialize in quickly and successfully landing crypto transactions. They’re popular among users for things like sniping — a term for buying up memecoins right after they are created — and tracking new token launches. Many are built on Telegram, although Axiom is only a web app.



It’s a crowded field, but Axiom has separated itself from the pack in recent weeks. In late February, the trading bots Photon, BullX, and Trojan combined for around 75% of Solana trading bot volume, according to a Dune <a href="https://dune.com/adam_tehc/trading-bots-on-solana">dashboard</a>. Today, Axiom has more than 50% of market share by itself.



Why does Axiom command so much revenue? Blockworks Research analyst Danny Knettel <a href="https://blockworks-research.beehiiv.com/p/bitcoin-yield-reimagined">told Donovan Choy</a> of the 0xResearch newsletter that Axiom’s secret sauce was combining the two most popular trading products of the moment — Solana memecoins and Hyperliquid perpetual futures. Knettel told me he’s heard rumors that other crypto teams are considering merging these two product offerings as well.



Zhang said Axiom’s rakeback program, where power users are given claimable fee rebates as opposed to the tier-based fee system on venues like Binance, is popular among users as well.



Then, of course, Axiom is running a points program, which tends to spur a short-term increase in usage. For what it’s worth, Zhang and Ellis told me they have no plans of launching a token — which tends to be the key ingredient in airdrop farming.&nbsp;



The pair also said they won’t be raising additional venture funding following Y Combinator’s seed check, as the business is already quite profitable.



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<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: Unpacking crypto and the markets.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

Hyperliquid

Meet Y Combinator’s memecoin bet that made $10M last week

This is a segment from the Lightspeed newsletter. To read full editions, <a href="https://blockworks.co/newsletter/lightspeed" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Loopscale Labs had one tough weekend.



Bad actors on Saturday <a href="https://x.com/LoopscaleLabs/status/1916183179469246626">exploited</a> Loopscale&#8217;s pricing functions to make loan collateral seem worth more than it really was, resulting in the theft of approximately $5.7 million in USDC and 1,200 SOL (or around 12% of the platform&#8217;s total assets.)



It’s obviously not ideal to suffer an exploit just <a href="https://blockworks.co/news/solana-defi-protocol-launches-efficiency">two weeks after launching</a>, but this isn’t your typical “DeFi protocol caught with its pants down” moment. On the contrary, many DeFi folks have rallied behind Loopscale&#8217;s response to the exploit, <a href="https://x.com/teethrichards/status/1916490751677972651">applauding</a> the team&#8217;s speed, professionalism and commitment to user recovery.&nbsp;



Loopscale USDC and SOL vault depositors do face losses, though early signs seem to point to a partial or even full recovery.&nbsp;



For those unfamiliar, Loopscale&#8217;s story ‘til now unfolds thusly.&nbsp;



Loopscale is a decentralized finance (DeFi) project that <a href="https://blockworks.co/news/solana-defi-protocol-launches-efficiency">automates</a> recursive leverage to make yield farming more efficient. Loopscale’s bread and butter is “looping” — repeatedly borrowing and redepositing assets to amp up yield and capital efficiency. They weren&#8217;t the first team to try to morph this premise into a mainstream financial primitive, but they have quickly become one of the most compelling. Honestly, it&#8217;s pretty neat work.



While the looping process has <a href="https://fortune.com/crypto/2023/05/25/looping-yields-risky-investment-strategy-automated-defi/">historically been dangerous</a>, Loopscale&#8217;s system offered automation, liquidation protection features, and a user experience that abstracted away many of those perceived risks. Loopscale&#8217;s vaults, known for their attractive yields and tokenized market integrations, became a favorite among farmers looking for structured, lower-friction leverage.&nbsp;



Founded by a small but technically-strong team, Loopscale built a reputation as one of the more serious players among Solana&#8217;s DeFi cohort.



At the core of Loopscale&#8217;s recent growth was its adoption of RateX&#8217;s Principal Token (PT) markets. Simply put, Principal Tokens are created by splitting a yield-bearing asset into two components — principal and yield — allowing users to trade, hedge, or lock in fixed returns more flexibly. In Loopscale&#8217;s case, PT tokens were used as collateral in the vaults on the assumption that their pricing would remain tightly aligned to predictable discounting curves.



But then, on April 26, that predictable curve broke.



According to Loopscale, a person with malicious intent <a href="https://x.com/marygooneratne/status/1916189553494315010">manipulated</a> how its vault system priced the RateX PT tokens, making the tokens seem worth more than they were. As a result, the attacker was able to take out a series of loans that were not fully backed by collateral, managing to withdraw $5.7 million USDC and 1,200 SOL from Loopscale&#8217;s vaults.



The vulnerability was not in RateX itself, as Loopscale has <a href="https://x.com/LoopscaleLabs/status/1916204152318738470">emphasized</a>. The issue was in how Loopscale&#8217;s contracts priced the RateX tokens.



RateX founder Sean Hu <a href="https://x.com/seanhu001/status/1916378332696056270">explained</a>, &#8220;Based on our investigation, the Loopscale incident has been confirmed as an oracle attack. The attacker manipulated the oracle price of collateral on Loopscale to borrow 5.8 million dollars, draining funds from the lending pool. RateX&#8217;s protocol itself has no security issues, and no RateX users suffered losses in this incident.&#8221;



RateX also confirmed it is assisting Loopscale in tracking the hacker and recovering funds.



As soon as Loopscale detected the exploit, it <a href="https://x.com/LoopscaleLabs/status/1916190858463805611">halted</a> all market functions to prevent further damage — disabling new loops, deposits and withdrawals across the platform while working to triage the situation.



In the immediate aftermath, <a href="https://x.com/LoopscaleLabs/status/1916230435291713786">Loopscale&#8217;s handling of the crisis</a> drew frank praise. The team issued a clear initial disclosure, <a href="https://x.com/LoopscaleLabs/status/1916460306219348002">re-enabled critical functions</a> like loan repayments and loop closing by the following day (big for protecting borrowers from unforeseen liquidations), and began coordinating with law enforcement and security professionals.



Then, on April 28, Loopscale announced it had successfully <a href="https://x.com/LoopscaleLabs/status/1916460302704509372">established contact</a> with the attacker. The exploiter had responded to <a href="https://etherscan.io/tx/0x6dcbf6de26631d18eed84410e06741a1940e7f1fc7b7660bf82796d4d133d646">an onchain message</a> proposing a white hat resolution, agreeing (tentatively) to return a portion of the stolen funds in exchange for a bounty.



While Loopscale initially offered a 10% reward, <a href="https://etherscan.io/tx/0x98b6a312a4ab4b1d6c397d64b5e33dba1cc0d3cad3b89fb5d7fa28c28383115c">the exploiter countered</a> with a 20% ask, citing frozen assets on crosschain bridges and offering to immediately return part of the stolen funds to prove good faith.



At the time of publication, negotiations remain ongoing. However, the initial signals are positive. A partial return appears to have already occurred, and Loopscale is preparing a detailed post-mortem and structured plan for resuming vault withdrawals. The team has also promised users a clear roadmap for what recovery will look like.



Updated on April 29, 2025 at 2:24 pm ET: Modified to reflect there were no early RateX contributors on the Loopscale team.



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hacks

Loopscale loses $5.8M in oracle attack

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One of the best parts of traveling is getting to meet new people, unless you’re traveling to a crypto conference.&nbsp;



Solana Crossroads kicked off today in Istanbul, so a number of Solana builders decamped from New York and San Francisco to sip stale coffee halfway around the world while talking with the same people they see at Solana events in New York and San Francisco. Many attendees stopped by the Step Finance-sponsored community conference on their way to Dubai for TOKEN2049 next week before shipping off to New York City for Solana Accelerate in May.



Crypto itself may still be struggling to find product-market fit, but crypto conferences seem to have inelastic demand.&nbsp;



After a <a href="https://blockworks.co/news/how-solana-became-the-peoples-chain">year of explosive growth</a> for Solana, Crossroads attendees didn’t seem too concerned with other ecosystems. Some complained that the yearly Ethereum conference ETHDenver <a href="https://x.com/PrimordialAA/status/1895894318927528350">talked too much</a> about Solana and other ecosystems. At Crossroads, it almost felt like those other smart contract ecosystems didn’t exist.&nbsp;



Solana teams hawked their wares on the conference’s expo floor. I held a prototype of the Solana Seeker phone. It wasn’t production-ready, so all I could really do was look at a promotional display on the screen, but I can now vouch for the fact that its casing exists, at least.&nbsp;



The internet filtering startup DoubleZero had some conference buzz. One Solana founder said market makers offered up their connection with the network as a way to pitch their services.&nbsp;



I caught DoubleZero co-founder Austin Federa near the media room and asked him some vague question about the state of high-throughput blockchains.



“Imagine if the sun disappeared,” he began before explaining the importance of being able to broadcast data.



While Crossroads is filled with many of the usual suspects, a number of locals showed up as well.&nbsp;



“I’ve been impressed with frankly just the number of local Turkish people who’ve shown up,” Framework Ventures partner Brandon Potts said. “A lot of the conversations with locals I’ve had are just practical ones around stablecoins and like, ‘Hey … which one should I hold?’”



I chatted with a Turkish Solana developer who filled me in on the history of the land. He told me that coins were invented in Lydia, an ancient kingdom located in modern day Turkey. His father collects coins, he added.



“You collect coins, too. Shitcoins,” his friend shot back.



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Earlier this week, we wrote that Solayer was about to begin its token unlocks.



We <a href="https://blockworks.co/news/solana-bug-patch-zero-knowledge-proofs">noted</a> that this would mark the first real loosening of grip over Solayer’s tightly controlled float, and observed that while the token had surged 87% in a month, traders appeared to be bracing for volatility.



Well, SURPRISE! That volatility came early.



In the 48 hours that followed, $LAYER <a href="https://app.blockworksresearch.com/assets/layer">collapsed more than 55%</a> from its all-time high, wiping out over $350 million in market cap. The selloff was sharp, disorderly and possibly — in the eyes of some — deliberate.



Back in March, onchain researcher Andrew 10 GWEI <a href="https://x.com/Andrey_10gwei/status/1919829616115540303">flagged</a> a series of Solayer team-linked wallets that <a href="https://x.com/Andrey_10gwei/status/1904213428148826407">received</a> large airdrop allocations, <a href="https://x.com/Andrey_10gwei/status/1904213436877140478">deposited</a> funds to Binance and appeared to sell into the market well ahead of this week’s unlock.&nbsp;



His analysis <a href="https://x.com/Andrey_10gwei/status/1904213441339924484">suggested</a> that only 3.6% of the total token supply — rather than the 12% promised — was actually distributed through the Genesis Drop. He claimed at the time that over $28 million in tokens were routed through wallets tied to the team.



Though Blockworks was unable to directly verify these claims, they have contributed to <a href="https://x.com/onchainquant/status/1919641933796016535">speculation</a> that the <a href="https://x.com/langeriuseth/status/1919855807404863796">downturn</a> was more of a <a href="https://x.com/Colasama/status/1919823238575649249">coordinated</a> exit. But whether orchestrated or not, the crash fed on itself. Thin order books, high leverage and looming dilution made for a classic cascade. The market structure Solayer relied on — thin float, heavy lockups and delayed investor cliffs — is the same playbook that powered dozens of outsized runs this cycle. But this can also be deeply unstable.



When a token trades with a high FDV and low float, <a href="https://www.binance.com/en/square/post/20199723509546">price discovery</a> becomes a function of narrative momentum, not actual demand depth. Early buyers are betting they can rotate out before gravity hits, and any deviation — a perceived exit, a mispriced unlock, a sharp funding flip — sparks the kindling.



Once that kind of volatility begins, there’s usually little structural support to stop it.



Zooming out, while Solayer unraveled, the Solana ecosystem <a href="https://app.blockworksresearch.com/flashnotes/solana-april-2025-update">posted</a> one of its strongest months in a year. DEX volumes and REV bounced back. SOL outperformed both ETH and BTC in April.



Block space rose to 50 million CUs with 60 million on the way. SolFi and ZeroFi, two closed-source “prop AMMs,” now make up 20% of DEX volume. Stablecoin supply hit an all-time high of $12.6 billion. Solana’s price at the time of publication is $146.57.



The chain’s fundamentals continue to accelerate. So why, then, does one of its most high-performing new tokens seem to have imploded?



Maybe because Solayer wasn’t priced on fundamentals — it was priced on narrative. On mechanical scarcity. On the hope that a thin float, institutional heat and Solana tailwinds could suspend gravity. The future of Solana itself may be bright, but its token economy is still wild, still early, and still very much a game of timing.



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investors

Volatility arrives early for Solayer

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As Solana continues to cement itself as the most performant layer-1 blockchain by speed and cost, some crypto developers have gained an interest in using the technology underpinning Solana to launch new blockchains of their own.



To wit, there are around two dozen of these Solana Virtual Machine chains — counting layer-1s, layer-2s built on various other blockchains, and application-specific chains. But for simplicity’s sake, here are the layer-1s trying to out-Solana Solana:



<h2 class="wp-block-heading">Fogo</h2>



Fogo is a <a href="https://blockworks.co/news/solana-chain-running-pure-firedancer">forthcoming layer-1</a> that says it wants to push the SVM’s performance to its limits by only running the Firedancer validator client on a permissioned validator set with multi-local consensus.



If that sounds like word salad, just know that Fogo’s bet is that with a fork of Jump’s open-source Firedancer code and a couple tradeoffs around decentralization, Solana’s software can be even more performant.



The layer-1 raised $8 million at a $100 million valuation via the crypto crowdfunding platform Echo.



<h2 class="wp-block-heading">Pythnet</h2>



The popular Solana oracle Pyth runs an SVM app chain where Pyth operators who provide price data run validators, and the protocol aggregates prices.&nbsp;



Pythnet is the oldest on the list: Remarkably, Pyth shipped its SVM chain in August of 2022.



Since it’s a blockchain for data, this chain is less consumer-facing than others, but it’s an interesting decentralized way to stream price data — and the product has been live for nearly three years.&nbsp;



<h2 class="wp-block-heading">Solayer</h2>



Solayer initially fundraised and launched as a Solana restaking protocol, but after Jito entered the <a href="https://blockworks.co/news/jito-releases-code-for-solana-restaking-network">restaking race</a> — and as restaking became less buzzy, to put it bluntly — Solayer pivoted to launching its own layer-1 powered by its InfiniSVM.



Solayer’s documentation and leadership have claimed that it can achieve one million transactions per second at points, although some Solana developers <a href="https://x.com/trentdotsol/status/1917328407878328470">dispute</a> Solayer’s performance figures.



<h2 class="wp-block-heading">JupNet</h2>



The Solana DeFi giant Jupiter began teasing JupNet in January as an “omnichain network that aims to aggregate all of crypto in one single decentralized ledger.”



Little is yet known about JupNet, but Jupiter co-founder meow said in a blog <a href="https://meow.bio/jupnet.html">post</a> that its so-called Jupiter SVM has validators come to agreement on both internal Solana transactions and external transactions from other blockchains.



Jupiter has greatly expanded its business via acquisitions in recent months, but JupNet may be its most ambitious venture yet.



<h2 class="wp-block-heading">Cube</h2>



Cube Exchange is building an SVM L1, co-founder Bartosz Lipinski confirmed to me in a Telegram message.



Lipinski and co. <a href="https://www.youtube.com/watch?v=vo3nhdIra6M">forked the SVM</a> as part of a product they’ve <a href="https://blockworks.co/news/cube-exchange-crypto-mpc">described as</a> a hybrid centralized-decentralized exchange.



<h2 class="wp-block-heading">Thru</h2>



This one barely counts since Thru will be built on a new virtual machine called the ThruVM, but a <a href="https://blockworks.co/news/unto-vc-raise-thru-blockchain-l1">lot of the intrigue</a> around this brand new project comes from the fact that its co-founder, Liam Heeger, was previously a core engineer working on Solana’s Firedancer client.



So with the Firedancer credentials, Thru ekes out a spot on the list.



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Solana’s software underpins these layer-1s

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In mid-April, leaders in the Solana world took to X to post the same cryptic hash. Strings like this can conceal a message’s contents from the public, while still allowing anyone with the original data to verify its authenticity.



Some <a href="https://x.com/0x_Osprey/status/1912915445830848625">speculated</a> the hash was a method to coordinate Solana validators to patch a vulnerability in Solana’s code, and they turned out to be right: Shortcomings in the protocol’s confidential tokens product could have allowed a sophisticated attacker to mint unlimited new tokens, the Solana Foundation disclosed on Friday. The upgrade follows a similar vulnerability and patch situation that <a href="https://blockworks.co/news/lightspeed-newsletter-solana-outage-patch">went down in August</a>.



Solana’s token-2022 standard includes a feature named “confidential transfers” that allows addresses to transact on Solana without revealing the transfer amount. Confidential transfers are verified with a zero-knowledge proof. The bug was basically caused by some missing math that could have allowed someone who knew what they were doing to have invalid proofs be accepted by Solana’s zk program.



The bug being identified and then privately patched with the help of Solana validators provided some good engagement bait for Ethereum fans, but to be fair, I’m not sure what better option Solana had here. No user funds were lost, which is arguably the most crucial factor.



“Criticism of Solana&#8217;s zero-day bug fix makes me realize people have no idea how it would work on Ethereum,” Equilibrium investment partner Mika Honkasalo wrote on X. “TLDR; mostly the same process except feeling ‘holier’ to the ETH community.”



One person involved in Solana’s efforts to patch the bug said the process of privately patching a bug before publicly disclosing the vulnerability later on follows “established security protocols seen in other major blockchains and software projects.”



It’s also not like Solana validators are sharing war plans in a Signal chat. The Solana Foundation, Anza, and Jito contact validators through a patchwork of platforms and then share a hash as a kind of two-factor authentication to prove their outreach is legit, according to multiple people I spoke to involved with the response.&nbsp;



If you believe that Solana is the financial rails of the future, then that’s actually a pretty messy way to coordinate emergency software updates. Solana’s approach to this kind of thing is, arguably at least, a bit too decentralized.



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