David Canellis

Michael Bodley

<div id="highlights-block_62acecffed51d" class="highlights">
 <ul>
 <li>Bitcoin miners across the US took out loans to finance their rapid expansion over the past year, when crypto prices were at record highs</li>
 <li>BTC’s current low price means miners are operating on razor-thin margins, putting them at risk of default</li>
 </ul>
 
</div>



Swaths of bitcoin miners face possible liquidation after taking out high-interest loans to fund their bull market spending habits, rather than selling their bitcoin — which industry participants say is apt to trigger a cascade of crypto lenders and hedge fund firms with exposures going bust.&nbsp;



Bitcoin miners rely on three profitability dynamics: the price of bitcoin (BTC), electricity prices and access to high-performance specialty mining rigs known as ASICs (application-specific integrated circuits). Check out our explainer guide for more info on the <a href="http://get%20educated.xn--%20check%20out%20the%20investors%20guide%20to%20avax%2C%20the%20investors%20guide%20to%20music%20nfts%2C%20the%20investors%20guide%20to%20defi%202-yy48ggbzc.xn--0%20and%20the%20investors%20guide%20to%20avalanche-s105a./">profitability and economics of bitcoin mining</a>.



All three are now distressing miners — plus their creditors and other counterparties.&nbsp;



BTC is down some 30% over the past month — from $31,000 to under $21,000. Summer electricity prices are forecast to double year on year in the Northeastern US, home to a good number of miners.



Rather than sell their mined bitcoin, US operations commonly took out loans at fairly high interest rates, Blockworks has learned, when bitcoin’s price was double what it is today.&nbsp;



Estimates suggest nearly 40% of all bitcoin mining happens in the US. Crypto lenders such as BlockFi, NYDIG and China’s Babel Finance helped facilitate growing ASIC inventories. The operation was working — before stablecoin UST’s collapse and digital assets lender Celsius’ insolvency.&nbsp;



While energy costs are concerning, bitcoin’s price is the primary source of pain for miners — especially those with large amounts of leverage.



“Sentiment is really bad,” said Todd Esse, co-founder of mining hedge fund firm HashWorks. “At this price, margins are very thin, especially heading into summer with power prices set to rise in Texas and PJM [Pennsylvania, New Jersey and Maryland].”



Before the latest broad-based market downturn, miners found creative loopholes to put down deposits — between 30% to 50% — to manufacturers to receive a fresh batch of machines, pledging to pay the balance with funds from yet-to-be-mined bitcoin.



Operators even borrowed cash to cover overheads using their ASICs as collateral — believing the price of bitcoin would continue to rise, allowing them to mine profitably. A number of lenders, including the recently underwater Babel Finance, underwrote such loans, leading to the risk of the creditor getting stuck with bulky, illiquid machinery that loses money every second without power. And that’s not to mention firms voluntarily shutting down their rigs — some can’t break even as the price of electricity climbs.



<blockquote class="wp-block-quote">Some will look to offload their entire ASIC supply on secondary markets, already awash with second-hand rigs from Chinese miners, according to mining consultant Alejandro De La Torre, who said it’s going to be “mayhem out there.”</blockquote>



In fact, HashWorks was recently offered top-of-the-line Bitmain S19j Pros for $4,400 — a staggering 65% below retail.&nbsp;



“The market is looking for a bid right now,” Esse said.



<h3>Lenders could reposses bitcoin miners to make themselves whole</h3>



Irrespective of where an operator got their rigs up and running, if there’s an outstanding line of credit, “no matter when you got in,“ it&#8217;s impossible to be “generating enough revenue through mining to make those loan obligations,” according to Jurica Bulovic, head of mining at Foundry Digital, which lends to crypto miners and engages in crypto staking.&nbsp;



Defaults on loans — which already carry a relatively high interest rate of about 11% annually — are expected to weigh heavily on creditors with large balance sheets.



However, most miners aren’t likely to start defaulting soon, Bulovic told Blockworks. Some have built balance sheets and other income to at least pay the interest.&nbsp;



But if the current economics continue, miners who’ve bought and and sold BTC over time will start tapping cash reserves.&nbsp;



If they have cash reserves.&nbsp;



“Obviously, no one wants to sell bitcoin, especially at these low prices, but they will have to to avoid default on their loans,” Bulovic said.



When possible, Foundry structures its loan between three parties — themselves, miners and the hosting facilities for rigs.&nbsp;



If the miner defaults, Foundry would take over the operation and continue to mine until it makes itself whole. But not all lenders have that expertise.&nbsp;



The final recourse is to repossess rigs and try to sell.



“This is a challenge for all lenders, as the markets are not very liquid,” Bulovic said. “It’s much easier to sell bitcoin than to sell an ASIC. I think some lenders in the space who came from traditional lending, or lending against bitcoin, will now realize that collateral they&#8217;re holding is maybe not as liquid or as valuable as they thought.”



<h3>Bitcoin hashrate expected to drop further</h3>



Evidence of pain can already be found in bitcoin’s hashrate, which measures processing power on the network. Over the past week, the hashrate has fallen around 17%, and bitcoin itself has tanked more than 20%.&nbsp;



Both Esse and De La Torre expect hash rate to fall significantly, although the Bitcoin network can withstand a sizable drop in hash rate and remain secure.&nbsp;



Crypto’s collapse has exposed immense leverage risk in bitcoin mining.



“If miners weren’t levered up, they’d either be mining or not, and they wouldn’t have debt to service,”&#8217; Esse said. “This business is like any other commodity business: how much do you want to leverage up in oil? You should be operating within cash flow.”



The notion of “free money” is gone in mining, De La Torre said, for those who didn’t consider a potential price drop.



“And perhaps financing ASIC machines at $13,000 was a stupid move — and now they’re paying for that stupidity,” he said.



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Crashing Prices Expose Bitcoin Mining Industry’s Addiction to Leverage

James Cirrone

Binance announced on Friday that it would be withdrawing from the Canadian market.



In its <a href="https://twitter.com/i/web/status/1657099651210969088">statement</a> on Twitter, Binance referenced Canada’s new stablecoin guidance and investor limits for crypto exchanges as two reasons why it&#8217;s departing the country.



“Binance will be joining other prominent crypto businesses in proactively withdrawing from the Canadian marketplace,” the statement said. “Unfortunately, new guidance related to stablecoins and investor limits provided to crypto exchanges makes the Canada market no longer tenable for Binance at this time.”



Other crypto companies that have left <a href="https://blockworks.co/tag/canada">Canada</a> include OKX, <a href="https://help.paxos.com/hc/en-us/articles/14791919809812-Paxos-Withdrawal-from-Canada">Paxos</a>, <a href="https://dydx.exchange/blog/canada-wind-down">dYdX</a>, all of them citing the regulatory environment.&nbsp;



Bittrex pulled out of Canada in July of last year, citing regulation as the main reason.



Binance’s exit comes as the Canadian Securities Administrators <a href="https://blockworks.co/news/crypto-exchanges-in-canada-have-30-days-to-register-with-regulators">forced crypto asset trading platforms to register with them by March 23</a>. Failure to meet “pre registration requirements” by the deadline meant crypto trading firms had to cease operations.&nbsp;



Additionally, exchanges were told by the Canadian agency to commit to segregation in crypto custody, maintain a chief compliance officer, while also halting the sale and holding of stablecoins.



<a href="https://blockworks.co/tag/binance">Binance</a> said that it “put off the decision” as long as it could but came to the conclusion that there was no avenue forward.&nbsp;



The tweet said that Binance is confident that it will “someday return to the market when Canadian users once again have the freedom to access a broader suite of digital assets.”



Remaining Binance customers in Canada will receive “an email with comprehensive information on how this will impact their accounts going forward.”



When reached for comment, Binance referred back to its original tweet.



Updated May 12, 2023 at 5:24 pm ET: Added response from Binance.



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Binance Leaving Canada, Market ‘No Longer Tenable’ for Exchange

Macauley Peterson

The Ethereum network <a href="https://blockworks.co/news/beacon-chain-temporarily-stops-finalizing">suffered a hiccup</a> Thursday; one that developers are still parsing for clues. But as a user, you would hardly have noticed.



At worst, it would have taken slightly longer for a transaction to be included in a block, and there was a somewhat lower certainty that a given action would be considered final — for about 25 minutes.



The blockchain’s developer community saw the incident as a strong test of the network’s resilience. It also served as further impetus to increase diversity of the independent software clients that make Ethereum run.



The extent of Ethereum’s client diversity is unique among major blockchains, and a cause championed by members of the community such as the pseudonymous Superphiz — known as the “Ethereum community health consultant” — who was one of the first to notice the issue.



“Barely a blip happened, but it was so uncharacteristic for the Ethereum network that it was a big deal anyway,” he <a href="https://twitter.com/superphiz/status/1657043885938421760?s=20">tweeted</a> Friday.



The same issue resurfaced again Friday, which Superphiz <a href="https://twitter.com/superphiz/status/1657076998676570119?s=20">called</a>, “not surprising,” adding, these things tend to happen in waves.



<h2>What happened?</h2>



The precise cause is not yet known, but the effect was a failure to finalize blocks. It’s likely to have involved a coincidence of “two or three issues,” according to Irina Timchenko, Ethereum blockchain manager at Everstake.



&#8220;During the incident, validators experienced issues with Prysm and Teku nodes. Some of these issues were resolved after a restart, while others returned to normal without requiring a restart,” Timchenko told Blockworks.



“Subsequently, validators noticed a spike in CPU usage, which appears to be a second-order effect rather than the root cause of the problem,” she added.



According to a Prysm developer known as Potuz, “several valid, but untimely attestations were broadcast in the network. This typically happens when a node that is struggling to be synced, attests with an old view of the chain.”



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">This stressed consensus clients in different ways to the point that they, specially those running on weaker hardware, started struggling to follow the chain. 2/8&mdash; Potuz (@potuz1) <a href="https://twitter.com/potuz1/status/1657031086046601222?ref_src=twsrc%5Etfw">May 12, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



A fix is already in the <a href="https://twitter.com/potuz1/status/1657031099501932544?s=20">works</a>, which has become more urgent since the problem has recurred.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Mainnet is not finalizing again. Prysm is releasing a patch today. Will keep you updated!&mdash; terence.eth (@terencechain) <a href="https://twitter.com/terencechain/status/1657082775034560512?ref_src=twsrc%5Etfw">May 12, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Timchenko and others say the loss of finality could have been avoided entirely if less than a third of all validators ran the same consensus layer software client. Currently, two clients, Prysm and Lighthouse, are estimated to be operating on greater than a third of Ethereum nodes, according to clientdiversity.org.


<div class="wp-block-image">
<figure class="alignright size-medium"><img decoding="async" loading="lazy" width="748" height="792" src="https://blockworks-co.imgix.net/wp-content/uploads/2023/05/Screenshot-2023-05-12-at-3.01.00-PM.png?w=300&amp;h=300" alt="" class="wp-image-55553" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2023/05/Screenshot-2023-05-12-at-3.01.00-PM.png?w=748 748w, https://blockworks-co.imgix.net/wp-content/uploads/2023/05/Screenshot-2023-05-12-at-3.01.00-PM.png?w=283 283w, https://blockworks-co.imgix.net/wp-content/uploads/2023/05/Screenshot-2023-05-12-at-3.01.00-PM.png?w=243 243w, https://blockworks-co.imgix.net/wp-content/uploads/2023/05/Screenshot-2023-05-12-at-3.01.00-PM.png?w=247 247w, https://blockworks-co.imgix.net/wp-content/uploads/2023/05/Screenshot-2023-05-12-at-3.01.00-PM.png?w=207 207w, https://blockworks-co.imgix.net/wp-content/uploads/2023/05/Screenshot-2023-05-12-at-3.01.00-PM.png?w=76 76w" sizes="(max-width: 748px) 100vw, 748px" /></figure></div>


Freddy Zwanzger, Ethereum ecosystem lead at Blockdaemon agrees.



“The fact that Ethereum does have multiple client implementations actually seemed to have prevented the blockchain from halting, and if all consensus clients would have less than 33% of the network, the finalization delay would also have been avoided,” Zwanzger told Blockworks.



Since blocks were still being produced, transactions were processed continuously, which is why end users didn’t see much, if any, effect, he added.



<h2>Liveness over safety</h2>



In designing blockchains with proof-of-stake consensus, developers have to make choices over how to prioritize one of two properties: safety and liveness.



Colloquially, safety is thought of as “avoiding bad things.” That means every node in the network agrees consistently on the state of the chain.



Ethereum prioritizes liveness, which is thought of as “good things happen eventually.” The blockchain is designed to be very difficult to halt.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">I developed a newfound appreciation for blockchain liveness (especially LMD-GHOST fork choice) since yesterday&#39;s incident. Ethereum didn&#39;t finalize for 3 epochs, but it kept going. Users were barely affected or noticed the finality gap.&mdash; terence.eth (@terencechain) <a href="https://twitter.com/terencechain/status/1657053102321836032?ref_src=twsrc%5Etfw">May 12, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



It could have been worse if Prysm were still installed on upwards of 66% of nodes, which has been the case in the past.



When a consensus layer client causes a loss of finality — which is what happened Thursday — the network averts a fork (a “bad thing” in this case) so long it doesn’t have a supermajority client. But liveness was impacted because Prysm remains above the 33% threshold.



Ethereum’s specific consensus algorithm, called <a href="https://arxiv.org/pdf/2003.03052.pdf">Gasper</a>, saved the day, according to Gaetan Semp, a blockchain and DeFi consultant at Alyra.



“Gasper is truly an amazing consensus algorithm,” he <a href="https://twitter.com/GaetanSemp/status/1656769775207346176">tweeted</a>, noting that even without a supermajority of nodes, the blockchain continued to be validated by LMD-Ghost, a “weaker ‘short-term consensus’ as venture firm Paradigm has <a href="https://www.paradigm.xyz/2022/09/goldfish">called</a> it. LMD is short of “Latest Message Driven” and LMD-Ghost is part of Ethereum’s “<a href="https://celestia.org/glossary/fork-choice-rule">fork-choice rule</a>.”



This is a trade-off, however, and one which not all users would approve of, <a href="https://twitter.com/mattfiebach">Matt Fiebach</a> of Blockworks Research noted.



“Without the ability for nodes to reach consensus and achieve transaction finality, a user cannot be sure that their transaction will be included in the Ethereum canonical chain,” Fiebach said.



Alternative architectures from Solana and Cosmos favor a chain halt to preserve safety. “A 30-minute loss of finality is unacceptable for end users because it puts transactions at risk of being reverted,” Richard Patel, a software developer for <a href="https://jumpcrypto.com/firedancer/">Firedancer</a>, <a href="https://twitter.com/fd_ripatel/status/1656811632796872715?s=20">tweeted</a> in response to the Ethereum glitch.



Firedancer, developed by Jump Crypto, will soon become the first independent client for Solana.



Vance Spencer, co-founder at Framework Ventures described the failure to finalize as “a significant event,” but one with “a lot of nuance.”



“Finalization is especially important for entities like exchanges which need to ensure on-chain transactions aren’t reverted after they process them off-chain,” Spencer told Blockworks.



<h2>A resilience test</h2>



Marius van der Wijden, who develops the Go Ethereum (or Geth) execution layer client for Ethereum, <a href="https://twitter.com/vdWijden/status/1656790867506520064?s=20">called</a> the incident “a great fire drill” and explained that having client diversity was key to the ability of the network to heal itself.



“The different implementations react slightly [differently] to extreme scenarios which provides a huge boost in reliability,” van der Wijden told Blockworks. “Having different implementations means we can test [them] against each other, which can help us quickly pinpointing issues and determining the root cause of an issue,” he added.



Van der Wijden was confident that proof-of-work consensus algorithms would have performed “much worse” under the circumstances.



Industry observers, such as Fabrice Cheng, co-founder and CEO at Quadrata, <a href="https://twitter.com/fabdaRice/status/1656812550858887168?s=20">sounded</a> an optimistic note about the long-term prospects of the Ethereum network, coming out of this affair.



“Even when over 60% of all nodes went offline, the longest time you had you wait for your transaction to be included was [1 minute and] 24 seconds,” he said.



Friday’s recurrence was more severe, but developers note that block production continues unabated.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">tl;dr -Blocks still chugging along, just increase missed slots -Longer finality delay than yesterday. Inactivity leak kicking in to slowly, but continuously incentivize validators (<a href="https://t.co/nnU2BZPInL">https://t.co/nnU2BZPInL</a>) -Prysm looking to push update today (<a href="https://t.co/QM7FnVirJP">https://t.co/QM7FnVirJP</a>) -Elite…&mdash; Joe | 0xOsprey.eth (@0x_Osprey) <a href="https://twitter.com/0x_Osprey/status/1657089732470517760?ref_src=twsrc%5Etfw">May 12, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Updated May 12, 2023, at 5:11 pm ET: Additional detail and comments.



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Ethereum Finality Hiccup a ‘Fire Drill’ That ‘Could Have Been Avoided’

Ben Strack

The SEC has targeted the operators of dozens of fraudulent websites that it alleges were offering “exorbitant returns” for investments in a range of securities offerings, including crypto asset mining pools.



While the US securities regulator has gone after crypto companies for what it claims to be potential securities violations, the latest signals its continued enforcement spree against what Eversheds Sutherland partner Adam Pollet called “garden-variety” fraud and misappropriation where crypto serves as the bait.&nbsp;



“Stamping out run-of-the-mill fraud [and] misappropriation in the guise of crypto is a good way to rid bad actors who would leverage the appeal of crypto,” he told Blockworks.



The returns promised by those behind the sites reached as high as 61.9% in 24 hours, the SEC said in a Thursday <a href="https://www.sec.gov/litigation/complaints/2023/comp25721.pdf">complaint</a> filed in Massachusetts’ federal district court.



Defendants include the unknown operators of websites such as GA-Investors.org (GAI), which “guaranteed” daily returns ranging from 2% to 4.5%, according to the regulator.



The defendants in the latest SEC action required individuals to create a private account on GA-Investors.org in order to invest. These private account pages included a digital wallet address that was controlled by GAI, the SEC alleges.



“Investors were then directed to purchase crypto assets from a separate crypto asset trading platform and transfer those crypto assets to GAI by sending them to the GAI wallet address listed on the private account page,” the complaint states.



The GA-Investors.org site is no longer accessible.



Others linked to the entity, however, continue to offer similar investments in securities. In addition to stocks, bonds and ETFs, these include investments in crypto asset mining and crypto asset ATMs, among others.



<h2>Leave the ‘good’ actors alone, lawyer says&nbsp;</h2>



Pollet told Blockworks it is important for regulators to remove bad actors and let the good ones operate.&nbsp;



“But that’s not the current tact of the SEC,” said in an email. “Instead the SEC is targeting everyone in the industry, including exchanges, which is arguably not a productive way to regulate the industry.”



“We expect the crackdown on the industry to continue,” Pollett added.



The SEC <a href="https://blockworks.co/news/sec-serves-coinbase-in-latest-alleged-crypto-securities-violation">served Coinbase with a Wells notice</a> in March, for example. The exchange <a href="https://blockworks.co/news/coinbase-sec-rulemaking-petition">sued the SEC</a> in an effort to gain clarity on the regulations the regulator is trying to enforce on crypto.&nbsp;



Various crypto industry players — as well as <a href="https://blockworks.co/news/chamber-of-commerce-backs-coinbase-sec-fight">the US Chamber of Commerce</a> — have come out in support of Coinbase in recent days by filing amicus briefs. 



<a href="https://blockworks.co/news/sec-crippling-digital-assets">The Crypto Council for Innovation argued</a> that by continuing with an enforcement-only approach, “good actors” in the industry have “no viable path” forward.



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SEC Goes After Sites Offering Crypto-related Daily Returns Up to 4.5%

Bessie Liu

MakerDAO is making strides toward Endgame, a detailed plan designed by its founder Rune Christensen with the hopes of improving governance.



Being one of the largest DeFi protocols, MakerDAO has been forced to navigate the complicated world of scaling and internal politics — which are faced by many startups that are transitioning into their growth phase — all whilst trying to remain decentralized.



According to <a href="https://forum.makerdao.com/t/the-5-phases-of-endgame/20830">the latest forum pos</a>t by Christensen, Endgame’s short-term goal is to ensure that MakerDAO’s stable token, DAI, becomes one of the most widely used stablecoins within the next three years without sacrificing governance equilibrium.



He proposes that to achieve this, Maker DAO must launch following Endgame’s comprehensive five-phase roadmap.



<h2>Phase 1: Beta launch</h2>



The first phase of Endgame will be establishing a new unified brand with its own stablecoin and governance token separate from DAI and MKR, Christensen said.



“Maker and Dai are established and trusted brands in the cryptocurrency space. Unfortunately they have drawbacks, including having two separate brands rather than a single cohesive concept,” he said.



The Accessibility Governance Process is currently working on redesigning MakerDAO with the ultimate goal of resolving fragmentation by creating a new, unified brand.



DAI and MKR token holders will have the choice to remain holding the tokens or upgrade to the new stablecoin and governance token, Christensen <a href="https://twitter.com/RuneKek/status/1656731619753852951">noted</a>.



<h2>Phase 2: SubDAO launch</h2>



Following the Beta Launch will be the creation of six Maker <a href="https://blockworks.co/news/are-subdaos-the-future-of-dao-governance">SubDAOs</a>, each one with its own governance tokens.



SubDAOs are designed to function independently from Maker, but are tied to the protocol through its mission.



“By delegating day to day complexity to SubDAOs, MakerDAO significantly streamlines the workload and complexity that Maker Governance needs to manage,” Christensen wrote.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Phase 2: SubDAO Launch follows some months afterwards with 6 new SubDAOs and 6 SubDAO token farms available for NewStable users. All initial SubDAO tokens will be distributed through these farms only. NewStable users can freely choose which to farm. USA &amp; VPN IPs are ineligible.&mdash; Rune (@RuneKek) <a href="https://twitter.com/RuneKek/status/1656731623478513664?ref_src=twsrc%5Etfw">May 11, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



<h2>Phase 3: Governance AI tools launch</h2>



Designing tools using AI for governance will be the third phase of MakerDAO’s Endgame.



The purpose of these tools will be to improve “Alignment Artifacts” which will guide the governance experience and improve processes over time without needing a centralized leadership.



These tools will be designed to be open source, Christensen noted.



“This both helps MakerDAO improve its own Governance AI Tools while also delivering on it’s public good purpose,” he wrote.



<h2>Phase 4: Governance participation incentive launch</h2>



The launch of the Sagittarius Lockstake Engine (SLE) will be the fourth phase of the Endgame plan.



This engine is designed to ensure the token holders of the new governance token will be actively incentivized to participate in governance.



Tokens are designed to be delegated to aligned voter committees and will be executed through “a user-friendly, gamified frontend for easy access,” Christensen said.



<h2>Phase 5: NewChain launch and final Endgame state</h2>



Launching a rebranded new chain will be the final stage of the Endgame State.



In this state, it will be difficult for major changes to occur in this state, Christensen notes. This means that MakerDAO’s core processes will be balanced, decentralized and sustainable “forever.”



This new chain is designed to be the hub of all backend tools operating MakerDAO.&nbsp;



“This means that on Ethereum, NewStable and NewGovToken, as well as Dai and MKR, will continue to function as normal, and the only change will be that they will be protected by a governance backend that operates through a secure, state of the art bridge,” Christensen wrote.



A new feature that Christensen is particularly excited about is the ability for the chain to hard fork in the case of “catastrophic governance disputes.”



“This provides a final level of governance security to users, businesses and protocols that rely on the Dai Stablecoin and NewStable, which ensures even the most extreme governance attack scenarios will only have a minimal impact on their user experience and will not put their funds or their stability at risk,” he said.



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Takeaways From MakerDAO’s 5-phase Endgame Update

Robinhood now offers equities trading 24 hours a day, five days a week for certain stocks. This could be seen as a bid to get traditional assets caught up with digital assets, which can be bought, sold and exchanged 24/7 on numerous exchanges, including Robinhood Crypto.



The company is calling it the 24 Hour Market, and will first be available to all customers by June. Though, a “subset” of users will be selected to test the feature next week starting on Tuesday, according to a <a href="https://blog.robinhood.com/news/2023/5/9/the-24-hour-market-is-here">statement</a> from Robinhood.&nbsp;&nbsp;



<a href="https://blockworks.co/tag/robinhood">Robinhood</a> further explained that the feature allows limit orders on certain stocks, namely, the most traded single-name equities and ETFs.



“Using [the] 24 Hour Market, people can place limit orders to buy whole shares of 43 of the most traded ETFs and individual stocks– such as TSLA, AMZN and AAPL,” the company statement read. “Trading hours will run from 8:00 pm ET on Sunday to 8:00 pm ET on Friday.”



As for Robinhood’s broader business, Blockworks previously reported on May 10 that the publicly traded company’s first quarter earnings saw its assets under custody grow to $78 billion. Crypto assets under custody for Robinhood clients <a href="https://blockworks.co/news/robinhood-crypto-on-uptic">totaled $11.5 billion in the first quarter</a>, a significant increase from its $8.4 billion through year end 2022.&nbsp;



Blockworks reached out to Robinhood for comment on its new 24 hour trading feature but didn’t receive an immediate response.



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Robinhood Wants to Make Stock Markets Like Crypto: 24 Hours a Day

Katherine Ross

Ethereum developer Virgil Griffith, who is currently serving five years in prison, received a 10-year-long export privilege bar, according to the Department of Commerce.



Griffith, even after he is released from prison, “may not directly or indirectly participate in any way in any transaction involving any commodity, software or technology…exported or to be exported from the United States that is subject to the Regulations.”



Essentially, Griffith faces a bar on his export privileges as a US citizen.



“Based upon my review of the record, including Griffith&#8217;s submission, and consultations with BIS&#8217;s Office of Exporter Services, including its Director, and the facts available to BIS, I have decided to deny Griffith&#8217;s export privileges under the Regulations for a period of ten years from the date of Griffith&#8217;s conviction,” John Sonderman, the director of the Office of Export Enforcement, <a href="https://www.federalregister.gov/documents/2023/05/12/2023-10105/in-the-matter-of-virgil-griffith-inmate-number-79038-112-fci-allenwood-low-federal-correctional">said</a>.&nbsp;



The order is in effect until April 12, 2032.



Last year, Griffith was sentenced to 63 months in prison – or five years – after he pled guilty to conspiracy to violate the International Emergency Economic Powers Act.



The act bars US citizens from exporting goods, services or technology to countries such as North Korea without a license from the Treasury Department’s Office of Foreign Assets Control.



He also paid a $100,000 fine as part of his sentencing.&nbsp;



In 2018, Griffith put together <a href="https://www.justice.gov/opa/pr/us-citizen-who-conspired-assist-north-korea-evading-sanctions-sentenced-over-five-years-and">plans</a> to provide services in North Korea, he developed and funded cryptocurrency infrastructure with the alleged knowledge that North Korea could then use the technology to bypass US sanctions.&nbsp;



“Watching Ukraine sanctions has shown me their value. I have been cured of my stubborn arrogance, and my obsession with North Korea. My career has been damaged. I’m sorry,” Griffith <a href="https://blockworks.co/news/virgil-griffith-sentenced-to-5-years-in-prison-in-n-korean-sanctions-case">said in court last year</a>.



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Imprisoned Ethereum Developer Virgil Griffith Faces 10-year Export Privilege Bar

Popular Ethereum liquid staking solution Lido will soon deploy its V2 upgrade, pending an on-chain vote that will go live on Friday.



This <a href="https://blockworks.co/news/lido-launches-v2-upgrade">much-anticipated upgrade</a> will enable withdrawals for ether (<a href="https://blockworks.co/price/eth" target="_blank" rel="noreferrer noopener">ETH</a>), and introduce a staking router that is intended to simplify on-ramps. This will make it easier to run individual staking nodes on the network.



Over <a href="https://lido.fi/ethereum">6.5 million ETH</a> is currently staked with Lido, and only after the V2 upgrade can this locked-up ETH be withdrawn from the network.&nbsp;



Withdrawal requests can be placed immediately after the upgrade and are expected to be finalized the following day, Eugene Mamin from the Lido development team <a href="https://research.lido.fi/t/lido-v2-voting-announcement/4576">wrote</a> in a proposal.



Mamin notes that <a href="https://blockworks.co/tag/lido" target="_blank" rel="noreferrer noopener">Lido</a> will use a withdrawal vault to fulfill these requests. An estimated 270,000 ETH is currently in the vault, which is designed to streamline the validator exit process.



An initial <a href="https://snapshot.org/#/lido-snapshot.eth/proposal/0x629b547c688dea536a4a5c5b42274894ac068df0b0278d173b4d7a68c8c4281d">snapshot vote</a> saw that LDO holders overwhelmingly supported the upgrade plan, with 52 million <a href="https://blockworks.co/price/ldo" target="_blank" rel="noreferrer noopener">LDO</a> holders (almost 100% of voters) voting in favor of the proposal.



A series of security audits have also been conducted, where nine independent auditors have reviewed the V2 smart contract code, resolving issues related to withdrawals, claims, oracle reports, safety, consistency and NFT withdrawal.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">A Lido V2 Audit Update: Security is a top priority. To this end Lido DAO dedicated significant effort to 9 independent V2 audits. These audits have uncovered important findings, all of which have been either acknowledged or fixed. 🧵 <a href="https://t.co/I5hilRT3qP">pic.twitter.com/I5hilRT3qP</a>&mdash; Lido (@LidoFinance) <a href="https://twitter.com/LidoFinance/status/1656364919246188565?ref_src=twsrc%5Etfw">May 10, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



<h2>A post-Shapella look at staking</h2>



Following the <a href="https://blockworks.co/news/ethereum-shapella-ok-despite-bug">Shapella upgrade</a>, staking yields have remained high, a <a href="https://staking.staked.us/state-of-staking">report</a> provided by Staked, a non-custodial staking provider and Kraken subsidiary, showed.&nbsp;



In fact, ETH staking demand too had seen a significant increase following the upgrade.&nbsp;



The report shows that ETH deposits had increased by more than 4x at the beginning of May compared to deposits just a week before the Shapella upgrade.&nbsp;



The month of March saw $600,000 worth of ETH staked, and this number increased to $750,000 in ETH just six days later.



Web3 startups such as the Lisk Foundation are also looking to <a href="https://twitter.com/maxkordek/status/1656629386689363970?s=20">move</a> their bitcoin into ether where they see more opportunities to maintain “a sustainable long-term yield.”



Although they have plans to eventually stake ETH, this move will not be immediate, List’s co-founder Max Kordek <a href="https://twitter.com/maxkordek/status/1656652481307332609">tweeted</a>.&nbsp;



Staked predicts that staking demand will steadily increase over the next year to year and a half, from around 15% today to over 20%-35%.



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Lido V2 Upgrade May Soon Be Live, Pending On-chain Vote

Coinbase executives managed to seek shelter during crypto winter.&nbsp;



Crypto lost a whopping $1.6 trillion off of its total market cap in 2022, but that didn’t stop <a href="https://blockworks.co/tag/coinbase">Coinbase</a> executives from raking in cash.&nbsp;



According to an SEC <a href="https://www.sec.gov/ix?doc=/Archives/edgar/data/0001679788/000167978823000065/coin-20230428.htm#i3cb39573656744c194f48e26318d6b44_40">filing</a> – with the exception of chief financial officer Alesia Haas – Coinbase’s executives walked away with more money in their pockets in 2022 than the year before.



CEO <a href="https://blockworks.co/tag/brian-armstrong">Brian Armstrong</a> made a total of $7.4 million last year, though $6.3 million of that total figure went to personal security costs.



Emilie Choi, chief operating officer and president, made $23.4 million in total compensation.&nbsp;



Haas made $11.9 million, down from the $16.2 million she made in 2021.&nbsp;



Surojit Chatterjee, former chief product officer, walked away with $20.7 million.&nbsp;



Chief Legal Officer Paul Grewal made $7.4 million.&nbsp;



2022 was a rough year for all of crypto, but Coinbase <a href="https://s27.q4cdn.com/397450999/files/doc_financials/2022/q4/Shareholder-Letter-Q4-2022.pdf">lost</a> $2.6 billion last year, according to the crypto firm’s <a href="https://blockworks.co/news/coinbase-stock-falters-after-earnings">fourth quarter 2022 earnings</a> report.&nbsp;



“To state the obvious, 2022 was a challenging year for the crypto market and our transaction revenues,” Coinbase said in its report.&nbsp;



The stock has also <a href="https://blockworks.co/news/crypto-stocks-tanked-2022">taken a hit,</a> down to $60 a share from a 52-week high of $116.&nbsp;



In early January of this year, Coinbase announced that it was <a href="https://blockworks.co/news/coinbase-lays-off-950-staff-cuts-operational-costs-by-25">cutting 950 jobs</a> – or 20% – of its workforce. In June of 2022, <a href="https://blockworks.co/news/coinbase-cut-workforce-ceo-wary-of-potential-recession">Coinbase laid off 18%</a> of its workforce.&nbsp;



The company wasn’t the only crypto firm to be exposed to frostbite through a chilly crypto winter. Following a strong year in 2021, the crypto sector was hit by a number of events from the depegging of the algorithmic stablecoin Terra, to the bankruptcies of three crypto lenders – BlockFi, Voyager and Celsius – and the fall of FTX.&nbsp;



However, as Blockworks has previously reported, while pain is still being felt across cryptocurrencies, <a href="https://blockworks.co/news/one-year-since-terra">20% of the 160 analyzed</a> have seen their market values grow.&nbsp;



In early May, Coinbase also <a href="https://blockworks.co/news/coinbase-smaller-net-loss">posted its first-quarter earnings</a>, which still saw a net loss for the quarter, but did note that the loss of $79 million was smaller than 2022’s net losses. 



“This quarter represented a turning point in our drive towards building a company that is more efficient and financially disciplined,” Coinbase said in a shareholder <a href="https://s27.q4cdn.com/397450999/files/doc_financials/2023/q1/Shareholder-Letter-Q1-2023.pdf">letter</a>.



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Despite Rough 2022 for Crypto and Coinbase, Executives Made Millions

Shalini Nagarajan

Binance.US and CEO Changpeng Zhao are actively exploring strategies to reduce his dominant ownership stake in the company, in what appears to be a pursuit to bolster the company’s reputation and standing with US regulators.&nbsp;



Zhao has been trying to sell a portion of his stake since the summer of 2022, The Information <a href="https://www.theinformation.com/articles/binance-us-explores-ways-to-cut-founder-changpeng-zhaos-majority-stake?utm_campaign=Automated+Fallback+R&amp;utm_content=89&amp;utm_medium=email&amp;utm_source=cio&amp;utm_term=19">reported</a> on May 11, citing two unnamed sources.



<a href="https://blockworks.co/news/bitcoin-and-ether-are-commodities-says-cftc-in-binance-lawsuit">Binance and Zhao are embroiled in a lawsuit</a> filed by the CFTC in March.



The CFTC <a href="https://www.cftc.gov/PressRoom/PressReleases/8680-23">alleged</a> that Binance operated an “illegal” exchange and maintained a “sham” compliance program. It targeted <a href="https://blockworks.co/tag/binance">Binance</a>, Zhao and Samuel Lim, the former compliance chief, accusing them of willfully evading US law and engaging in activities outside the US to avoid CFTC regulations.



These activities involved structuring entities and transactions to bypass registration requirements and providing US customers with instructions on circumventing compliance controls.



Both <a href="https://blockworks.co/tag/changpeng-zhao">Zhao</a> and Binance.US were already attempting to cut his stake before the CFTC lawsuit. But since the suit, company leaders have discussed how this might help improve the company’s image in the eyes of US regulators.



Executives at Binance.US expressed concerns that the company’s ability to obtain desired regulatory licenses in the US may be hindered as long as Zhao, named in the lawsuit, retains his majority stake, Reuters <a href="https://www.reuters.com/technology/binanceus-explores-ways-cut-founder-changpeng-zhaos-majority-stake-report-2023-05-11/">reported</a>, citing The Information.



Binance.US didn’t return Blockworks’ request for comment by press time.



Having a controlling stake means owning a big chunk (usually over 50%) of a company’s shares. Zhao’s controlling stake means he has the power to call the shots and influence everything from Binance’s operations to strategy.



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Binance.US Exploring Options to Cut Changpeng Zhao’s Stake

Sebastian Sinclair

Coinbase co-founder Fred Ehrsam appears bullish on the US crypto exchange’s stock.



Ehrsam, also the co-founder and managing partner of crypto investment firm Paradigm, scooped up $48.8 million worth of Coinbase (COIN) shares earlier this week, according to an SEC filing.



The co-founder, via Paradigm, has acquired an additional 810,000 shares of Coinbase stock in several trades across Tuesday and Wednesday. He bought shares for between $59.30 and $63.20 each.



Ehrsam now owns a total of 5.6 million COIN shares held indirectly through three entities Paradigm One LP, The Frederick Ernest Ehrsam III Living Trust and Paradigm Fund LP, the filing shows.



Coinbase, one of the largest cryptocurrency exchanges, went public through a direct listing on the Nasdaq Exchange in Apr. 2021. Ehrsam raked in $270 million by offloading Coinbase stock in the months after Coinbase went public — cashing in nearly 856,000 shares for $315.67 on average.



Since its listing, COIN has plummeted some 85% from its opening bid more than two years ago, when it listed at $381 a share. It&#8217;s now at $60.35. In year-to-date terms, COIN is faring much better, up 81%.



It follows earlier purchases from Coinbase insider and Shopify CEO Tobias Lutke, who&#8217;d been spending hundreds of thousand of dollars on COIN stock per week on average throughout the start of the year. 



Those buys have since ceased, per OpenInsider data compiled by Blockworks, which tracks SEC filings.



Ehrsam co-founded the company with CEO Brian Armstrong in 2012. Prior to founding Coinbase, Ehrsam was a foreign exchange trader at Goldman Sachs.&nbsp;



Armstrong himself has been busy selling Coinbase stock fund his other ventures, with an eye to offload 2% of his company stake <a href="https://blockworks.co/news/coinbase-ceo-armstrong-stock-sales-life-extension">over one year</a>.



Ehrsam left his day-to-day role at Coinbase in 2017 but continues to be involved with the company, serving as a company director. After leaving Coinbase, he co-founded Paradigm, a crypto-focused investment firm, with Matt Huang, a former partner at Sequoia Capital.



Ehrsam’s latest buys come around one year after he first bought the Coinbase dip, spending $76.8 million to acquire a little more than 1.1 million COIN shares, scooping them up for $68.49 on average.



Overall, since Coinbase went public, Ehrsam&#8217;s cost average currently sits at $65.67, putting him about 9% down on his COIN purchases to date.



David Canellis contributed reporting.



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Coinbase Co-founder Buys Dip, Spends $50M on Company Stock

Julien Genestoux

Crypto has a bad reputation.&nbsp;



There are many other reasons why, but I think this bad rep often comes from crypto being misunderstood, both by its critics (haters?) and fans (cultists?).&nbsp;



These misunderstandings often arise from half-truths used as marketing material to promote the technology that ends up being taken at face value.



One such misunderstanding is the idea that blockchains are “immutable.” I was recently at a conference where most attendees I spoke with were crypto skeptics. A fairly regular pushback I heard was that immutability was bad and because blockchains are immutable, this is not a good or useful technology.&nbsp;



But are blockchains really immutable?&nbsp;



No.



When it comes to immutability, in fact, blockchains are no different from the “real” world in that the only thing that can&#8217;t be changed is the past.&nbsp;



<h2>Why even have blockchains?</h2>



You might be wondering what the point of a blockchain even is, if indeed any change can be reversed.&nbsp;



If a transaction recorded yesterday transferred some coins from X to Y, it is not possible to “rewrite” the transaction (almost without <a href="https://en.wikipedia.org/wiki/The_DAO_(organization)">exception</a>) to change the amount, recipient or sender of that specific transaction. However, it is possible to create another transaction from Y to X for the same amount to “restore” the balances.&nbsp;



Importantly, using the same mechanism as above, any “state” can be updated, not just balances, but also the code of smart contracts themselves in blockchains that support them, like Ethereum.



Rather than focusing on blockchain’s faux immutable state then, move your gaze over to who can change the state to see what actually matters. In the example above, only Y can ever send a new transaction to X.&nbsp;



In Bitcoin, only the owner of a private key can change the balance of the account that matches this private key.&nbsp;



And in the Ethereum world, each smart contract has its own logic for which a user is allowed to make what change. A currency contract (like ERC-20) would probably only allow the owner of any coin to transfer them, but it may also enable some special admin user to perform transfers (like the USDC contract does, for example).



Similarly, if a contract is upgradable, it is likely only upgradable by a single address. Interestingly, this specific address itself may be another contract like a multisig or a DAO, opening up the possibility of oversight controls.



This means that the really exciting consequence of blockchain isn&#8217;t immutability at all, but accountability, i.e. anything that&#8217;s executed or changed is only possible because it was previously specified. Of course, that doesn&#8217;t mean code will never have bugs that result in unintended behaviors, but there’s a level of accountability with the code being publicly visible by anyone.



This accountability is what makes blockchains really useful for things that are widely shared and require “trust” that no one can arbitrarily change. This is true of money, but also of many foundational pieces of infrastructure that enable collaboration between humans.



Accountability makes the concept of governance critical. Accountability lets groups of users collectively set the rules (if any!) that determine what can be changed in a contract, how, by whom, when…etc. And even on blockchains that have no concept of smart contracts that predefine custom rules — Bitcoin being the most prominent example — governance can happen.&nbsp;



<h2>The myth of immutability</h2>



Blockchains are vast networks of machines (nodes) that collectively agree on the state of a ledger. That agreement is, in fact, the protocol, and each individual node can decide on what “version” of the protocol it adheres to.



The state of the blockchain is determined by the version of the majority of nodes. Even when there are no explicit rules around changes, if the majority of nodes decide to change, the blockchain will change. This happens with Bitcoin (Segwit, Taproot…), Ethereum and any other network.&nbsp;



That&#8217;s the reason why even the most repeated claims about any blockchain’s immutability, like the permanence of the supply of coins or the balances of certain accounts, can in reality be changed…as long as enough of the actual members of that network want the change.



The immutability of blockchains is therefore subject to humans collectively working together.



When we use applications on these blockchains, we can trust that history will remain unchanged — but not because of some intrinsic properties baked into the technology. It’s because the human actors governing the blockchains decide for it to be that way.&nbsp;



And it’s this human coordination that allows applications to always perform the same certain actions in the same certain ways that could not be more valuable.



<hr class="wp-block-separator has-alpha-channel-opacity"/>


<div class="wp-block-post-author-biography">Julien is the founder and CEO of Unlock, where he’s building the web&#8217;s new business model by enabling brands and creators to connect directly with their audiences through a decentralized access control system. He previously founded SuperFeedr, which became one of the leading real-time web APIs, received funding from Mark Cuban and Betaworks, and was later acquired by Medium. At Medium, Julien led the company’s SEO efforts and quadrupled the share of traffic Medium receives from search. He created his first company, Jobetudiant, while still in school. After nearly 20 years, it’s still one of the largest job boards for students in France.</div>


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Blockchains Are Not Immutable

Jump Trading is facing a fresh class action lawsuit that accuses the firm of purchasing substantial quantities of algorithmic stablecoin <a href="https://blockworks.co/tag/ust" target="_blank" rel="noreferrer noopener">UST</a> to manipulate its value toward $1, thereby misleading investors about its true price and risks associated with the token.



The Chicago trading giant allegedly played a role in aiding and abetting a fraudulent scheme involving Terra, resulting in financial losses of at least $40 billion for investors who put their money into related cryptocurrencies, per the class-action.



New Jersey-based resident Taewoo Kim filed the <a href="https://www.scribd.com/document/644577737/Taewoo-Kim-et-al-v-Jump-Trading#download&amp;from_embed" target="_blank" rel="noreferrer noopener">lawsuit</a> on May 9 on behalf of affected investors, claiming that Jump Trading was an early partner and financial supporter of Terraform Labs.



Starting around Nov. 2019, negotiations between former Terraform CEO Do Kwon and Jump were said to result in a series of agreements.&nbsp;



As part of these, TFL loaned 30 million LUNA tokens to Jump, enabling them to provide market-making services for LUNA and UST, according to the lawsuit. In return, Jump was entitled to compensation, which included receiving LUNA tokens at a significantly discounted rate, it&#8217;s alleged.



Subsequently, the value of UST experienced an unexpected decline and fell below $1 on May 19, 2021, plunging by 10% — about one year before Terra&#8217;s cataclysmic implosion, when it <a href="https://blockworks.co/news/one-year-since-terra" target="_blank" rel="noreferrer noopener">crashed to zero</a>.



The lawsuit alleges that not long after, on May 23 that year, Kwon and Jump conspired to artificially inflate the prices of UST and aUST (a token used on Terra’s lending platform, Anchor). This was apparently accomplished through Jump’s covert purchase of large quantities of UST, temporarily restoring the false appearance of UST’s $1 peg.



<h2>&#8216;Unnamed US trading firm&#8217; cited in SEC indictment</h2>



The lawsuit alleges TFL, Jump and Jump Crypto President Kanav Kariya misrepresented UST’s &#8220;re-peg&#8221; as restored by TF ofL’s algorithm, misleading the market about UST’s value and risks. 



Supporting claims made in Kwon’s <a href="https://www.sec.gov/litigation/complaints/2023/comp-pr2023-32.pdf" target="_blank" rel="noreferrer noopener">criminal SEC indictment</a> filed in Feb., it’s worth noting that he allegedly sought assistance from an unnamed US trading firm to manipulate the market price of UST. Taewoo Kim’s lawsuit speculates the unnamed firm is Jump Trading.



The lawsuit specifically claims between May 23 and May 27, 2021, Jump Trading engaged in significant net purchases of over 62 million UST tokens. These trades were conducted across multiple cryptocurrency trading platforms in order to conceal Jump&#8217;s manipulative actions. 



To compensate Jump for its supposedly secret manipulation of UST and aUST, TFL agreed to transfer 61.4 million LUNA to Jump at a fixed price of $0.40 per token under an agreement signed July 2021. The arrangement was to remain in effect for the next four years, regardless of LUNA’s actual market value, which sometimes exceeded $90 per token in secondary markets. 



<figure class="wp-block-embed is-type-wp-embed is-provider-flourish wp-block-embed-flourish"><div class="wp-block-embed__wrapper">
<iframe class="wp-embedded-content" sandbox="allow-scripts" security="restricted" title="Interactive or visual content" src="https://flo.uri.sh/visualisation/13735114/embed#?secret=rIEA6fQHH9" data-secret="rIEA6fQHH9" frameborder="0" scrolling="no" height="575" width="700"></iframe>
</div><figcaption class="wp-element-caption">LUNA skyrocketed before crashing to zero</figcaption></figure>



As a result of this scheme, Jump is said to have made a staggering profit of more than $1.28 billion by selling the heavily discounted LUNA tokens it had acquired through the modified agreement.



Blockworks has not verified the veracity of the allegations contained within the lawsuit and makes no claims of wrongdoing. We&#8217;ve reached out to Jump and Kariya for comment.



The lawsuit reads: &#8220;Plaintiff’s allegations are based upon personal knowledge as to himself and his own acts, and upon information and belief as to all other matters based on the investigation conducted by and through Plaintiff’s attorneys, which investigation included, among other things, a review of the whitepaper of the digital assets at issue, press releases, media reports, and other publicly disclosed reports and information about Defendants.&#8221;



<h2>Jump reportedly less keen on crypto these days</h2>



Despite constant allegations, Kwon himself has denied the possibility of manipulation.&nbsp;



The lawsuit pointed out a series of tweets from Kwon on May 23, 2021, in which he dismissed allegations of UST price manipulation.



The lawsuit further claims that the defendants continued to hide their misconduct even after the collapse of UST in May 2022.



Kim claims he made purchases of UST and aUST at a time when the prices had been manipulated by Jump. He seeks appropriate damages to be determined at trial.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">1/ It’s interesting that cockroaches only come out when the night is darkest. This thread should help you understand what’s been going on &amp; how the protocol(s) have responded recently:&mdash; Do Kwon 🌕 (@stablekwon) <a href="https://twitter.com/stablekwon/status/1396368169091043328?ref_src=twsrc%5Etfw">May 23, 2021</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Jump Trading’s crypto division is reportedly scaling back its operations in the US market due to increased regulatory actions targeting the crypto industry, Bloomberg <a href="https://www.bloomberg.com/news/articles/2023-05-09/jane-street-jump-pull-back-crypto-trading-amid-us-crackdown" target="_blank" rel="noreferrer noopener">reported</a> on May 10.&nbsp;



The firm is still said to be in the game of market-making, albeit on a smaller scale, but doesn’t plan to ditch crypto entirely.



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Jump Earned $1.3B By Manipulating Terra, Lawsuit Alleges

Bitcoin (<a href="https://blockworks.co/price/btc" target="_blank" rel="noreferrer noopener">BTC</a>) continues to flirt with valuations not seen in nearly two months, as price momentum nosedives.



The asset, which is down 2.5% on the day to $26,300, lost its footing above a support threshold along $27,000 sending it to its lowest point since March 14.



Bitcoin&#8217;s return to $25,000 looks like a very “real prospect” in the coming days, FxPro senior market analyst Alex Kuptsikevich told Blockworks in an email.



“The bears will have their work cut out for them here, as some oversold conditions will have built up by then,” he said, highlighting the distorted equilibrium between buyers and sellers.



For a time, volatility was muted as prices remained relatively locked between $27,000 and $30,000. That was <a href="https://blockworks.co/news/bitcoin-price-less-volatile">expected to persist</a> throughout May, as declining interest across crypto derivatives effectively sapped long and short sellers.



It’s worth noting that as of May 8, bitcoin volatility was hovering at its lowest point since the beginning of January at 29% — down significantly from March 13’s peak of 63%, data from <a href="https://app.intotheblock.com/coin/BTC/deep-dive?group=financials&amp;chart=volatility" target="_blank" rel="noreferrer noopener">IntoTheBlock</a> shows.



However, volatility has been spiking on the daily time frame since May 8 and that uptick is poised to feed into medium-term price action.



Still, the fact that the price has not yet breached $25,000 is significant when viewing this year’s performance, Kuptsikevich added.



“Now it has every chance of becoming an equally reliable support,” he said.



But first, bitcoin would need to sort out its <a href="https://blockworks.co/news/bitcoin-mempool-surges-new-life-for-blockchain">congestion issues</a>, Rich Rosenblum CEO of market maker GSR told Blockworks.



Data reveals a significant increase in unconfirmed Bitcoin transactions, which currently stand at 284,369. This is a 440% rise compared to the figure of 52,600 observed nearly two months ago on March 17.



The current weight of the mempool, which refers to the total data size within it, is about 871 MB. This exceeds the default maximum mempool limit of 300MB set by Bitcoin Core, <a href="https://mempool.space/" target="_blank" rel="noreferrer noopener">data shows</a>.



It&#8217;s important to note that not every node operator sticks to the default 300MB limit. Some opt for higher thresholds to prevent discarding transactions with lower fees.&nbsp;



When this occurs, transactions continue to be processed, they just might come with a higher cost, likely the result of a newly popular use case for the world’s oldest crypto.



Over the past week, there has been a substantial increase in the number of Ordinals inscriptions on the Bitcoin network, which has almost doubled from <a href="https://dune.com/dgtl_assets/bitcoin-ordinals-analysis" target="_blank" rel="noreferrer noopener">2.5 million to 4.78 million</a>. This surge is largely attributed to the growing interest in the <a href="https://blockworks.co/news/defi-on-bitcoin">BRC-20 token</a>.



“Organic congestion due to excitement over BRC-20? Well, that’s probably bullish that we’re finally seeing enough adoption that it’s slowing the network,” Rosenblum said.



If, on the other hand, the network is deliberately flooded with a continuous cycle of small transactions in an attempt to profit from a bitcoin short position. “That’s bearish and hard to police in a decentralized world,” he added.



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Bitcoin Price Analysts Eyeing $25K as Support Following Momentum Shift

It’s been a slow start to the year for crypto businesses seeking fresh capital.



Industry-related firms globally netted $2.42 billion in venture capital over 374 deals throughout Q1, 2023, marking a notable decline in value for the fourth straight quarter.



The year’s first quarterly period witnessed a 20% decrease from the previous quarter in total deal value, from $3 billion to $2.4 billion, <a href="https://my.pitchbook.com/search-results/s284388313/deal_chart" target="_blank" rel="noreferrer noopener">data from Pitchbook</a> shows. That translated into roughly 5% less in deal numbers over the same period, from 394 to 374.



Investments have continued to fall following their peak 12 months ago, thanks largely to waning interest in digital assets and a number of scandals that continued to damage crypto’s image.



As it stands, this year’s second quarter is on track to clock a fifth consecutive decline in both deal count and value, standing at 129 and $867 million, respectively. It’s worth noting that there remain roughly 49 days left in Q2, or roughly seven weeks, to break that streak.



Despite the overall decline, there were a few positive developments at the beginning of the year, Pitchbook said in its &#8220;Emerging Tech: Crypto Report,&#8221; published Thursday.



Layer-2 scaling solutions, which aim to improve the scalability of crypto like bitcoin and ether, continued to attract significant investment.



Native zkEVM Ethereum layer-2, Scroll, which processes transactions off-chain, clinched a $50 million deal on March 6 with a post-money valuation of $1.8 billion.



Bitcoin scaling platform Blockstream also managed to raise $125 million in a late-stage deal on Jan. 24, valuing the company at $2.49 billion, data shows.



That’s still a far cry from 2021 and 2022’s biggest deals, including Fireblocks&#8217; $550 million later-stage VC in January of last year and Blockchain.com’s $490 million deal, three months later.



“We believe late-stage valuations are being skewed upwards, as we suspect that only outsized, up-rounds are being disclosed and down-rounds are being kept private,” Pitchbook said in its report.



“Additionally, Q1 2023’s sample size is small and represents only a single quarter of data. We expect rising seed and late-stage valuations to reverse throughout the year.”



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Venture Investment Expected To ‘Reverse’ After 20% Quarterly Drop

BlockFi customers who held crypto in interest-bearing accounts don’t have a right to nearly $375 million in crypto after the bankrupt lender froze assets last year, a judge ruled.&nbsp;



However, customers who held custodial wallets did not give up the same ownership rights.&nbsp;



Around $300 million can be returned to customers who held crypto in custodial accounts, meaning non-interest-bearing accounts.



<a href="https://blockworks.co/tag/blockfi" target="_blank" rel="noreferrer noopener">BlockFi</a> froze transfers in early November of last year, and <a href="https://blockworks.co/news/blockfi-files-for-bankruptcy">officially filed for bankruptcy</a> on Nov. 28. It quickly followed FTX following the defunct exchange’s collapse.  



According to Judge Michael Kaplan, wallet transfers from interest-bearing accounts to custodial wallets did not occur after 8:15 pm ET on Nov. 10.&nbsp;



So, customers who still had crypto tied up in interest-bearing accounts – which totaled nearly $375 million – no longer have the right to those assets despite receiving email and in-app confirmation from BlockFi.&nbsp;



BlockFi, in court papers, said that $292 million in assets were stuck on the platform, all of which can be canceled by the company in Kaplan’s ruling. 



“The user interface did not accurately reflect the transactions,” Kaplan said in court, according to a <a href="https://www.bloomberg.com/news/articles/2023-05-11/blockfi-crypto-customers-lose-fight-over-disputed-coin-transfers?srnd=cryptocurrencies-v2">Bloomberg</a> report.&nbsp;



&#8220;Quite simply, a customer&#8217;s withdrawal or transfer request on the user interface did not and does not automatically transfer digital assets,&#8221; Kaplan said, per <a href="https://www.reuters.com/legal/blockfi-gets-court-permission-return-297-million-wallet-customers-2023-05-11/">Reuters</a>.



The back-and-forth on account withdrawals has been ongoing since late last year.



Last December, the bankrupt lender filed a motion to allow some withdrawals to be processed though, even then, it was unclear if the interest-bearing accounts would be included in withdrawals.&nbsp;



In April, BlockFi was granted extra time to file its bankruptcy strategy. It has until <a href="https://blockworks.co/news/blockfi-bankruptcy-exit-plan">May 15 to file its exit plan.</a> 



Kaplan <a href="https://www.law360.com/articles/1598805">reportedly</a> granted the extension in hopes of making the continuation of the case smoother.



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BlockFi Can Return Nearly $300M to Some Wallet Customers, Judge Rules

Ethereum’s Beacon Chain temporarily stopped finalizing Thursday, according to a community health consultant of the blockchain.&nbsp;



The incident occurred at roughly 4 pm ET, according to <a href="https://twitter.com/superphiz/status/1656761424222253064?s=20">tweets</a> by the pseudonymous superphiz.eth.&nbsp;



“I don&#8217;t know why yet, but in general the chain is designed to be resilient against this, transactions will continue as usual and finalization will kick in when the problem is resolved,” they tweeted.&nbsp;



Ethereum had a hard time reaching consensus, resulting in a brief, but drastic, downtick in validator participation on the consensus layer, according to <a href="https://www.blockworksresearch.com/">Blockworks Research</a> Senior Analyst <a href="https://twitter.com/swmartin19">Sam Martin</a>.&nbsp;&nbsp;



“This led to a period of time where Ethereum blocks were not being finalized, but blocks were still being validated as normal on the execution layer,” he added. “This is yet another instance that highlights the importance of client diversity amongst Ethereum’s validator set.”



Client diversity refers to the need to have multiple independent clients to ensure the decentralization of a network.



A follow-up tweet at about 4:50 pm ET suggested blocks were being finalized again.



If a consensus client has over 33% of its Ethereum nodes compromised, the Beacon Chain could stop finalizing.



This means that user transactions could be tampered with or changed, threatening the security of the Ethereum blockchain as a whole.



Historical precedent shows that having a diverse set of validators can prevent denial-of-service attacks. During the Shanghai denial-of-service attacks in 2016, attackers tricked the dominant client at the time (Geth) into slowing down block operations. Alternative clients who were not affected by the vulnerability were online at the time, and able to prevent Ethereum from being compromised.&nbsp;



Superphiz.eth said the loss of finalization might be “the first real-world test of our consensus client diversity work,” and called the incident “big, but inconsequential.” 



“Decentralization on all levels limits the impact of these events, regardless of what caused this we must continue hardening every vector,” superphiz.eth added.



Superphiz didn&#8217;t immediately return a request for comment.



The incident is currently being investigated by Ethereum developers and more information is expected to be revealed.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Mainnet has been finalized, and we are investigating the incident now. More to come!&mdash; terence.eth (@terencechain) <a href="https://twitter.com/terencechain/status/1656763665893429253?ref_src=twsrc%5Etfw">May 11, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Updated May 11, 2023 at 5:54 pm ET: Added additional context and comments throughout.



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Ethereum’s Beacon Chain Temporarily Stops Finalizing: Chain Consultant

Matthew Fiebach

The Kwenta Fee Switch + Update

Digital Asset Summit (DAS) is returning March 2024.



This year&#8217;s event will be held in our nation’s capital, where industry leaders, policymakers, and institutional experts will come together to discuss the latest developments and challenges in the ever-evolving world of cryptocurrency.



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<li>Access to institutional dinners and exclusive networking events,</li>



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And more! Don’t miss out on the opportunity to be in the room when the future of crypto is decided.



Join us and help shape the future of our industry.

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March 18-20 | Washington, D.C.

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Digital Asset Summit 2024 | Washington, D.C.

2022 was a meme. Skeptics danced, believers believed. Eventually, newcomers turned away, drained of liquidity and hope. Now, the tide is shifting and it&#8217;s time to rebuild.



Permissionless II is the brainchild of Blockworks and Bankless. It’s not just a conference, but a call to action for those who want to build a better future together.



Permissionless II embodies the ethos, electricity and excitement for crypto and Web3, all while acknowledging that somewhere in 2022, we lost the script.&nbsp;



If you’re still here, you can see the opportunity before us. Together, we can get it right this time.&nbsp;



Permissionless II: Coming to theaters in Austin, TX this September.

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Speakers

Erik Voorhees

Mary-Catherine (MC) Lader is the Chief Operating Officer of Uniswap Labs, a developer of foundational web3-based products and applications. In this role, she oversees the company’s growth efforts, strategic initiatives, and operations. Previously, she held various leadership roles at BlackRock, including as the Global Head of the firm’s digital sustainability business, Chief Operating Officer of the firm’s digital wealth business, and leader of the firm’s strategic fintech investments and blockchain activities. MC began her career as an investor in Goldman Sachs’ Special Situations Group. She received her J.D. and M.B.A. degrees at Harvard Law School and Harvard Business School, respectively, and her B.A. at Brown University.

Mary-Catherine Lader

Zaki Manian is a Co-Founder of Sommelier, the most powerful coprocessor yet for DeFi traders and Liquidity Providers. He’s also a Co-Founder of iqlusion, which provides infrastructure like a data center and a Cosmos validator for next-gen crypto technologies. Previously, Zaki helped build the Cosmos ecosystem, including launching the first public Cosmos testnet, and served as a director of Tendermint. Zaki has been a leading developer in the blockchain space since 2014, when he taught himself cryptography and began contributing to projects including Bitcoin, Ethereum, Zcash, and Tendermint. Having studied history of science at the University of Pennsylvania, Zaki’s skill sets in software engineering, programming, and computer science are largely self-taught.

Zaki Manian

Justin Drake

At Alluvial, Chief Growth Officer Mara Schmiedt focuses on advancing industry participation and adoption of Liquid Collective, seeking out world-class partnership opportunities, and overseeing Business Development, Sales, and other strategic functions. Mara recently joined Alluvial as Chief Growth Officer from Coinbase, where she served as the Head of Sales for Coinbase Cloud, the leading developer platform for blockchain-based infrastructure products and APIs. She expanded Cloud's staking business, supporting large-scale organizations, enterprises, and institutional investors. Prior to joining Coinbase, she managed Business Development at Bison Trails, a leading provider of blockchain-based infrastructure acquired by Coinbase in February 2021. Mara also served as Strategy Manager at ConsenSys, where she supported the strategic development of Codefi, the blockchain application suite for Web3 Commerce and Finance.



Mara is passionate about open-source technology and has published multiple research reports and papers on liquid staking, such as <a href="https://drive.google.com/file/d/13-s15SvCIUBukhSZiNkpd0sTff3izQ5G/view">The Internet Bond</a> and <a href="https://consensys.net/insights/eth-2-staking-ecosystem-report/">Ethereum 2.0 Staking Ecosystem Report</a>.&nbsp;



Additionally, she has led various industry initiatives, including leading the working group with the Ethereum Foundation that developed the Ethereum Launchpad and the first distributed validator technology (DVT) PoCs. Mara's deep experience in bringing technology and blockchain-based products and services to market — as well as her track record of building world-class business and sales organizations — bolsters Alluvial's support of Liquid Collective.

Mara Schmiedt

Stani Kulechov

Hasu

Christine is a Partner and Head of Digital Asset Strategy at Apollo Global Management, Inc. In this newly created position, Christine leads digital asset strategy across the firm, exploring more ways to apply blockchain technologies to Apollo’s business. She also plays a key role in Apollo’s strategy to invest in some of the most innovative digital asset companies and founders, with a specific focus on those transforming the financial services sector where Apollo can serve as a validator and enabler of new technologies. Previously, she was a Managing Director at J.P. Morgan and led its Blockchain/Crypto/Metaverse program through initiatives in digital assets, tokenized payments, internet of-things, decentralized identity, NFTs, and virtual worlds. She is a graduate of Brown University. Christine was named in Fortune’s The Ledger 40 Under 40 list of “the most impressive, young superstars transforming business at the leading edge of finance and technology.”

Christine Moy

Santiago Roel Santos (CryptoPunk #9159) is an investor focusing at the intersection of DeFi and the Web3 metaverse (NFTs/gaming). Most recently was a Partner at ParaFi Capital, one of the largest crypto funds specializing in DeFi. Prior to that, he was at Sageview Capital investing in Internet and software and, before that, at JP Morgan investment banking. Santiago began investing in crypto in 2012.

Santiago Roel Santos

Michael Anderson is the co-founder of Framework Ventures, one of earliest and largest VC firms to enter the “DeFi” or Decentralized Finance industry. With over $1B in AUM, the firm has since expanded into additional maturing verticals like blockchain gaming and social crypto. Prior to Framework, Michael and his co-founder Vance Spencer launched Hashletes, a digital collectible startup with official licensing from the NFL. Before entering crypto, Michael served as a product manager at both Snapchat and Dropbox, where he helped build out their monetization platforms.

Michael Anderson

Soona Amhaz is founder and GP of Volt Capital, a venture firm that focuses on pre-seed and seed companies in the digital assets space. Soona is also an advisor to On Deck, Forbes 30 under 30 in VC, and an alum from the University of Michigan School of Engineering.

Soona Amhaz

Colleen Sullivan is Co-Head of Ventures at Brevan Howard Digital. Prior to joining Brevan Howard Digital, Colleen co-founded and served as CEO of CMT Digital, where she was also a partner with the broader CMT Group and commenced activities in the crypto industry in 2013. Prior to starting CMT Digital, Colleen co-founded Sullivan Wolf Kailus, a boutique law firm that specializes in hedge fund, private equity, venture capital, digital assets, and other alternative investment products. Colleen also previously practiced law in the Investment Funds and Derivatives group at Sidley Austin LLP and, at age 25, co-founded a company called iOptions Group LLC, which developed hedging and monetization strategies for holders of employee stock options. Ms. Sullivan currently serves on the Advisory Board of the Chamber of Digital Commerce.

Colleen Sullivan

Tarun is an alumni of D. E. Shaw Research (DESRES), Vatic Labs, an HFT firm, and Cornell. He fell into the blockchain world in 2011, when he was working on ASICs at DESRES and observed Bitcoin ASIC mining rigs substantially delay DESRES’s ASIC production. He has spent the last seven years working on simulation-based R&amp;D at the intersection of high-performance computing and AI and is applying this knowledge to the blockchain ecosystem.

Tarun Chitra

Kevin Owocki is the founder of Gitcoin.co — Where builders &amp; funders come together to build the open web.  Gitcoin has delivered <a href="http://gitcoin.co/results">$50mm worth of value</a> to OSS devs in the last several years. He has a BS in Computer Science, 15 years of engineering leadership experience in Open Source Software and Web Startups. Kevin is a community organizer in the Boulder Colorado Tech Scene.

Kevin Owocki

Meltem Demirors is Chief Strategy Officer of CoinShares, a publicly listed investment firm that manages over five billion in digital assets on behalf of a global investor base, and is a trusted partner to investors and entrepreneurs navigating the digital asset ecosystem.



 An established veteran of digital asset investing, Meltem draws on her substantial experience and widespread influence to accelerate growth and acceptance of the asset class. Prior to joining CoinShares, Meltem helped build and grow Digital Currency Group, raising capital from the world’s largest corporations and managing a portfolio of 120 companies and 4 subsidiaries. Before she was bitten with the bitcoin bug, Meltem worked in the Oil &amp; Gas industry in trading, corporate treasury, and M&amp;A roles. 



Meltem has been recognized for her personal contributions to the industry and serves as an outspoken advocate. She is a founding member of the World Economic Forum Blockchain Council. Meltem teaches at her alma mater MIT as well as Oxford, and is passionate about privacy and civil rights.

Meltem Demirors

Vance is the co-founders of Framework Ventures, a thesis-driven venture capital firm whose team of technologists, researchers, and investors partner with founders and teams to build token-based networks and develop the requisite cryptoeconomics, governance, and community to scale.

Vance Spencer

Jim Bianco is President and Macro Strategist at Bianco Research, L.L.C. Since 1990 Jim’s commentaries have offered a unique perspective on the global economy and financial markets. Unencumbered by the biases of traditional Wall Street research, Jim has built a decades long reputation for objective, incisive commentary that challenges consensus thinking. In nearly 20 years at Bianco Research, Jim’s wide ranging commentaries have addressed monetary policy, the intersection of markets and politics, the role of government in the economy, fund flows and positioning in financial markets.



Jim appears regularly on CNBC, Bloomberg and Fox Business, and is often featured in the Wall Street Journal, Bloomberg News, Grants Interest Rate Observer, and MarketWatch. Prior to joining Arbor and Bianco Research, Jim was a Market Strategist in equity and fixed income research at UBS Securities and Equity Technical Analyst at First Boston and Shearson Lehman Brothers. He is a Chartered Market Technician (CMT) and a member of the Market Technicians Association (MTA). Jim has a Bachelor of Science degree in Finance from Marquette University (1984) and an MBA from Fordham University (1989).

Jim Bianco

Mr. Forman is the Founder and Managing Partner of ParaFi Capital. ParaFi is a leading investment firm focused on the blockchain and digital asset markets, and an early pioneer in decentralized finance (“DeFi”). ParaFi is one of the largest investors, users, and governance participants within the DeFi ecosystem, spanning the full network lifecycle from pre-launch to full decentralization. Mr. Forman serves as the Chief Investment Officer across the firm’s strategies, which include investing in public and private cryptoassets, systematic credit and market neutral DeFi strategies, and blockchain-focused venture capital and growth equity investing.



Prior to founding ParaFi in 2018, Mr. Forman spent 10 years at leading alternative investment managers, including KKR and TPG. While at KKR, Mr. Forman served as a Director in the Credit business, investing across a wide array of industry sectors and strategies, including distressed special situations, private credit, and opportunistic and liquid credit. Prior to KKR, Mr. Forman served as a Vice President with TPG’s former credit business, Sixth Street Partners, as one of the first investment professionals to join the platform, helping scale its private credit vehicle, TPG Specialty Lending, which listed publicly in 2014. Earlier in his career, Mr. Forman worked in private equity at Littlejohn &amp; Company and investment banking at Rothschild &amp; Co. Mr. Forman graduated with a B.A. in Philosophy, Politics and Economics, magna cum laude, from the University of Pennsylvania.

Ben Forman

Haseeb is a Managing Partner at Dragonfly. He was previously a partner at Metastable Capital, and has a background in software engineering at Airbnb and Earn.com (acquired by Coinbase).

Haseeb Qureshi

Vanessa Grellet is a Managing Partner at Aglaé Ventures. Vanessa is a Global Executive with over 20 years of expertise in the Financial Services and Tech industry. At Aglaé Ventures she manages the Web 3 focused fund. Prior to joining Aglae she has Head of Portfolio growth at CoinFund and Executive director at ConsenSys where she focused on driving adoption for Ethereum based products,  Strategic initiatives, Alliances and Channels.  She was involved in setting up the Enterprise Ethereum Alliance (EEA), the Accounting Blockchain Coalition (ABC) and the Blockchain for Social Impact Coalition (BSIC). Prior to ConsenSys she was a Strategy Executive at NYSE focused on investments and M&amp;A and a key member of PwC’s global wealth management team. Vanessa is a Founding Board member of AABC focused on Blockchain and Art, a member of the Advisory Council of ConsenSys, a Milken Institute Associate, a contributor to the  World Economic Forum Digital Future Council and part of <a href="https://cointelegraph.com/top-people-in-crypto-and-blockchain-2022/vanessa-grellet">Cointelegraph’s list of 100 most influential people for 2022</a>. Mrs. Grellet graduated Cum Laude from Law School (Paris II Assas) and Business School (HEC).

Vanessa Grellet

Mihailo Bjelic received his MSc in CS from the University of Belgrade. Prior to entering Web3/blockchain industry, he co-founded an AI/ML-powered platform for automotive industry and several other smaller startups and side projects. In 2017, he decided to join the Web3 movement full-time, primarily as a researcher interested in Ethereum scaling and multi-chain paradigms. In parallel with his work, he became one of the prominent Ethereum proponents and community members. In 2019, he started working on Polygon and conceptualized its architecture, vision and brand. In 2020, he joined hands with the Matic Network team and they have been working together on Polygon since then.

Mihailo Bjelic

Ben is a co-founder of Optimism, a leading Ethereum L2 ecosystem. He served as Chief Scientist before becoming a director at the Optimism Foundation. In his free time, he makes Ethereum-based parody songs under his stage name, Weird ETH Yankovic.

Ben Jones

Kristin is the CEO of the Blockchain Association, the Washington, D.C.-based trade association representing more than 100 of the industry’s leading companies. She also serves as a board member of the Filecoin Foundation for the Decentralized Web. Kristin serves as a liaison between policymakers and the cryptocurrency industry to assist in the creation of legislation and regulation that promotes the growth of the cryptocurrency ecosystem in the U.S. She is also a leading, public voice advocating for the cryptocurrency and blockchain industry through top-tier media interviews, op-eds and letters to the editor, and global speaking engagements. Kristin is a renowned voice for the industry, having been featured on Fortune’s 2020 40 under 40 list, CoinDesk’s 2021 50 people who defined the year in crypto, and CoinTelegraph’s 2022 top 100 Influencers in Crypto and Blockchain. Prior to leading the Blockchain Association, Kristin helped blockchain and technology companies achieve their public policy objectives in Washington. She served as a Senate and congressional aide on Capitol Hill for nearly ten years, much of which was spent focusing on technology policy.

Kristin Smith

Avichal is a successful entrepreneur with executive experience at Google and Facebook, which acquired his previous company. As an angel investor, Avichal has invested in 15 unicorns and 5 decacorns including Airtable, Boom Supersonic, Color Genomics, Cruise, Deel, Figma, Newfront Insurance, Notion, Nova Credit, Pulley, and others. He co-founded Electric Capital in 2018 and has grown it to one of the largest crypto venture firms globally. Electric is an investor in many of the leading web3 protocols and companies such as Bitwise, Bitnomial, dYdX, Frax, Kraken, Magic Eden, NEAR, and Solana.

Avichal Garg

Matt Hougan is one of the world’s leading experts on crypto, ETFs, and financial technology. He is Chief Investment Officer for Bitwise Asset Management, a pioneer in cryptoasset index funds with more than $1.2 billion in assets under management. He was previously CEO of ETF.com, where he helped build the world’s first ETF data and analytics system, the leading ETF media site, and the world’s largest ETF conference, Inside ETFs. Hougan is co-author of both “A Comprehensive Guide to Exchange-Traded Funds” and “Cryptoassets: The Guide to Bitcoin, Blockchain and Cryptocurrencies for Professional Investors” from the CFA Institute’s Research Foundation. He is a crypto columnist for Forbes, and a three-time member of the Barron’s ETF Roundtable.

Matt Hougan

Li Jin

Ethan is the co-founder of the Cosmos network and serves as the CEO of Informal Systems. Informal Systems is a member-driven worker’s cooperative building software that enables trustworthy relationships between protocols and people to flourish. Ethan also serves as the President of the Interchain Foundation which funds and coordinates development of public goods in the Cosmos ecosystem. Ethan sees local money systems as the basis for self-sufficient local economies to prosper. With a background in cell biology, neuroscience, mathematics, machine learning, and distributed systems, his goal is to build systems that encourage humans to work cooperatively through methods of self-organization. He is currently focused on blockchain technology as a means to bring greater political and economic sovereignty to local communities around the globe. Prior to Informal Systems, Ethan co-founded the Tendermint and Cosmos projects, and served as CTO of Tendermint Inc. Today, dozens of projects are adopting technology conceived in the original Cosmos whitepaper, including the Inter-Blockchain (IBC) Communication protocol – an industry-standard for permissionless communication between sovereign blockchains. Today, the Cosmos ecosystem continues to pioneer technological paradigms for building interoperable application-specific blockchains.

Ethan Buchman

Tyrone leads J.P. Morgan’s Blockchain team and is responsible for creating innovative Web3-focused products &amp; solutions for J.P. Morgan’s businesses and clients, and for engaging with the industry at large in order to provide a holistic blockchain strategy for the firm. Tyrone is also the Head of Onyx Digital Assets, a multi-asset tokenization platform that enables the exchange of value for various types of digital assets. Tyrone was previously a Senior Blockchain Product Manager in J.P. Morgan’s Blockchain Center of Excellence and was also the Head of Product for Quorum, an open-sourced Ethereum-based blockchain platform built for Enterprise use. Prior to moving into the blockchain industry in 2015, Tyrone was a software engineer within J.P. Morgan's Credit Markets business, and before that he spent several years in Product transformation, managing and delivering large strategic programs across various businesses within J.P. Morgan, across Front, Middle and Back Office risk and trading systems. Tyrone sits on the Board of Directors of The Enterprise Ethereum Alliance and The Hyperledger Foundation.

Tyrone Lobban

Rich is a Co-Founder and President of GSR and leads the group across strategic initiatives and growth. He began his career at Goldman Sachs where he spent 11 years between New York and London in commodities trading as a Managing Director and Global Head of Crude Oil and Derivatives Trading. Prior to joining GSR, he spent a few years on the buy-side, running energy trading teams at two New York-based hedge funds. Rich earned a bachelor’s degree in Mathematics from Columbia University.

Rich Rosenblum

Kain Warwick is an Australian cryptocurrency entrepreneur most-known as the founder of Synthetix protocol. Synthetix is a financial primitive that enables the creation of synthetic assets, offering unique derivatives and exposure to real-world assets on the blockchain.&nbsp;In 2020, Kain popularised the concept of yield farming that sparked the 2020 DeFi boom, earning the moniker: ‘the father of modern agriculture.

Kain Warwick

Brian Quintenz is the Head of Policy for a16z crypto, where he helps to translate between the crypto and policy communities.



Brian has long stood out as an innovative thinker in crypto and DeFi and was one of the earliest leaders in Washington to recognize the value of crypto. Brian initially joined a16z crypto as a senior advisor. In December 2022, he moved to the full-time role leading its policy team.



Prior to joining a16z, he was nominated by both Presidents Obama and Trump to serve as commissioner of the Commodity Futures Trading Commission (CFTC) and, in August 2017, was unanimously confirmed by the U.S. Senate. He also led the agency’s Technology Advisory Committee, which hosted the most comprehensive set of public crypto-related policy discussions and briefings of any federal financial regulator. During his service, the CFTC oversaw the listing of the first U.S. regulated Bitcoin and Ether futures contracts on derivatives exchanges, and the rapid expansion of DeFi. All the while, he was a champion for tailored, risk-calibrated regulation.



Prior to his appointment to the CFTC, Brian was the Founder and Managing Principal of Saeculum Capital Management, LLC where he developed and implemented Saeculum’s long term, momentum-based investment process for both traditional discretionary accounts as well as a managed-futures, commodity pool hedge fund.



Brian began his career on Capitol Hill, where he worked for 6.5 years and served as senior policy aid to a Member of Congress. He received his B.S. from Duke University and M.B.A. from Georgetown University.

Brian Quintenz

Robby Yung, Animoca Brands’s CEO of Investments, partner at Animoca Capital, a leader in digital entertainment, blockchain, and gamification with a portfolio of products and games including the REVV and SAND tokens, as well as investment and partnerships with companies like Axie Infinity,  OpenSea, Dapper Labs, and Alien Worlds and subsidiaries like The Sandbox, Gamee, Quidd, and Lympo. Robby has been in gaming since 2012 and blockchain gaming since 2018. He served as the first CEO of Animoca Brands after taking the group public in 2015. Prior to that, he cofounded magazine publisher, One Media Group, which he listed on the Hong Kong Stock Exchange. He also founded Chinese television and outdoor media concern, Redgate Media Group, which was acquired by  Inno-Tech Holdings . He began his career in technology, building wireless telecom networks in China and Indonesia with Metromedia.

Robby Yung

Motty Lavie serves as the Chief Executive Officer and Co-Founder of Braavos, a cutting-edge smart contract wallet designed to offer a seamless UX and prime security through true multi-factor authentication.. As a seasoned entrepreneur, Motty has established companies within the traditional web2 sector and successfully scaling them into multimillion-dollar global enterprises. Motty holds a B.Sc. in Computer Science and Mathematics from the prestigious Technion Israel Institute of Technology

Motty Lavie

Lucas Vogelsang is the CEO and Co-founder at Centrifuge, focusing on bringing Real World Assets to DeFi since the early days of Ethereum. Before diving into crypto in 2017 Lucas has been working at the intersection of tech and business since dropping out of University. He co-founded the Swiss e-commerce startup DeinDeal as its CTO. After its successful sale, he helped the German startup KaufDA with their international expansion. Lucas spent 6 years in Silicon Valley where he was working at early stage startups including Taulia where he met his Centrifuge co-founders.

Lucas Vogelsang

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<h2>Why Sponsor Permissionless II?</h2>
If you’re serious about crypto, you have to be at Permissionless. Permissionless brings together DeFi builders, DAO participants, protocol developers, crypto companies, funds and institutions, and more. It’s a true crypto-native’s paradise, where you’ll have the opportunity to showcase your offerings and form lasting connections with the community.
We’ll work with your team to define the perfect sponsorship opportunity that best fits your needs and budget. Want to do something completely revolutionary? Our team can help design a bespoke package that brings your vision to life.
Get in touch with us at <a href="mailto:sales@blockworks.co">sales@blockworks.co</a>
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