Resistance Dog

Kate Irwin

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



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Coinbase said on Thursday that “less than 1%” of its monthly users’ personal identifiable information has been exposed in a <a href="https://www.coinbase.com/blog/protecting-our-customers-standing-up-to-extortionists">breach</a>, including names, addresses, phone numbers, the last four digits of Social Security numbers, government ID data and other information.



According to the exchange, “overseas” Coinbase support agents gave private customer data — including government IDs and customer addresses, among other info — to scammers. The scammers are believed to be using that data to target Coinbase customers via social engineering scams.&nbsp;



Coinbase has declined to pay the $20 million bitcoin ransom the attackers reportedly demanded. CEO Brian Armstrong says they’re taking steps to prevent something like this from happening again, and they are paying back those who were impacted by the incident.



Coinbase estimates this data breach may cost it anywhere from <a href="https://www.reuters.com/business/coinbase-says-cyber-criminals-stole-account-data-some-customers-2025-05-15/">$180 million</a> to $400 million.



“People are terrified,” <a href="https://x.com/GivnerAriel/status/1923130484873121917">wrote</a> crypto and IP attorney Ariel Givner in a post, reporting that she has received multiple concerned messages from clients who were notified that their information was exposed in the Coinbase breach.&nbsp;



So what can people do to protect themselves from data breaches, which have become <a href="https://www.wsj.com/tech/cybersecurity/why-are-cybersecurity-data-breaches-still-rising-2f08866c">increasingly common</a>?



If you were notified by Coinbase that your data was impacted and you want to be cautious, there are a number of things you can do. Identity theft, fraud in your name, and targeted financial scams toward you or your immediate family are the most likely areas of concern.



There are personal information removal services out there, like DeleteMe, that can remove information about you from the internet. You can also request this <a href="https://support.google.com/websearch/answer/12719076?hl=en">through Google</a>. But if the data is already in an attacker’s hands, you may want to consider <a href="https://www.aarp.org/home-family/personal-technology/info-2021/remove-home-from-google-street-view.html">blurring out</a> your home from Google Maps’ street view and freezing your credit to stop anyone from opening lines of credit in your name. And as Microsoft <a href="https://support.microsoft.com/en-us/topic/national-public-data-breach-what-you-need-to-know-843686f7-06e2-4e91-8a3f-ae30b7213535">suggests</a>, you may want to place a fraud alert with the major credit bureaus.



For further awareness, you may want to warn immediate family members and close friends that attackers may attempt to socially engineer them in a scam tied to you. You can also talk to loved ones about having a <a href="https://x.com/netdragon0x/status/1923062046632837291">secret word</a> or phrase that’s unrelated to your personal info that you use to verify your identity with them.



The Texas Attorney General’s office <a href="https://www.texasattorneygeneral.gov/consumer-protection/identity-theft/help-prevent-identity-theft#:~:text=Store%20documents%20that%20have%20your,them%20for%20a%20specific%20reason.">advises</a> Americans to not use debit cards for online purchases, and to only use one credit card for online purchases to streamline and better protect your online identity.&nbsp;



California’s Attorney General <a href="https://oag.ca.gov/idtheft/facts/top-ten">agrees</a> that using antivirus software, being wary of unrequested phone calls, and being careful to not click on potential “phishing” emails are additional ways to protect yourself. <a href="https://www.optoutprescreen.com/">Opting out</a> of pre-approved credit card offers is another way to prevent credit card fraud in your name, and it’s good practice to review monthly statements and free annual credit reports.



When it comes to crypto, of course, never share your seed phrase or recovery phrase — or even your wallet password — with anyone, including those who claim to be customer support. Only storing recovery phrases on pen and paper in a safe location is your best bet.



You can also consider using an encrypted password manager app, ensure two-factor authentication via an authenticator app is enabled on as many accounts as possible, and make sure you’re using strong, unique passwords for every account you have.



Coinbase is telling users to “expect imposters” and to turn on withdrawal allow-listing, lock their Coinbase accounts if something feels off, and <a href="https://www.coinbase.com/blog/hang-up-the-phone-stop-social-engineering-scams">review tips</a> on avoiding social engineering scams.



Data breaches, more broadly, are unfortunately common. Last year, AT&amp;T, UnitedHealth’s Change Healthcare, Ticketmaster, Dell, Disney, Roku, Trello, and other companies, government entities and data brokers faced data breaches. Sometimes, such breaches result in class-action lawsuits or government-issued fines, with the average data breach costing a company <a href="https://nordlayer.com/blog/data-breaches-in-2024/">$4.88 million</a> last year.



NordLayer reported that <a href="https://nordlayer.com/blog/data-breaches-in-2024/">68% of data breaches</a> last year involved human errors, citing Verizon’s latest Data Breach Investigations report.



A lot of data breaches are preventable, and it starts with access and data storage practices.



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Coinbase

Coinbase breach fallout: What to do if your data was exposed

Macauley Peterson

This is a segment from the 0xResearch newsletter. To read full editions, <a href="https://blockworks.co/newsletter/0xresearch" target="_blank" rel="noreferrer noopener">subscribe</a>.



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A Solidity developer friend of mine reached out on Signal the other day in a tizzy. “I can’t believe this,” he wrote. “How did <a href="https://blockworks.co/tag/ethereum">Ethereum</a> developers let this happen?”



He was referring to a <a href="https://cointelegraph.com/news/pectra-wallet-exploit-offchain-signature-risk">recent article</a> worrying about Ethereum’s <a href="https://blockworks.co/news/ethereum-pectra-fork-live">Pectra upgrade</a> — specifically EIP-7702 — and its supposed ability to let hackers “drain wallets with just an offchain signature.” The piece has been bandied about on X/Twitter, it seems, though not by people I follow. Fears were clearly being stoked in some circles that a new transaction type quietly enabled attackers to seize control of wallets without an onchain transaction or even a user’s knowledge.



But like many things in crypto, the reality is both more nuanced — and less dramatic.



Ethereum’s recent Pectra upgrade, <a href="https://blockworks.co/news/ethereum-pectra-fork-live">activated on May 7</a>, introduced a powerful mechanism that enables externally owned accounts (EOAs) to temporarily act like smart accounts. But the rollout has been accompanied by breathless claims that it exposes users to some insane new risk.



Those headlines are misleading. While <a href="https://blockworks.co/news/ethereum-upgrade-account-abstraction-proposal">EIP-7702</a> could introduce a new attack surface for phishing, it doesn’t bypass wallet signatures or allow unauthorized access per se. Instead, it signs a special message for the temporary superpowers. But if that message falls into the wrong hands, someone else could take control — as if handing over a private key to your wallet for a single session.



Sounds dangerous, and it can be, but only if a user is tricked into signing a malicious delegation. It’s not a protocol failure, but something for wallet software publishers to take account of.



Security <a href="https://www.fireblocks.com/blog/security-first-approach-to-eip-7702">researchers</a> and <a href="https://x.com/AmbireWallet/status/1920068000901734459">wallets</a> responded proactively to 7702. For example, alongside support for the feature, Ambire and Trust Wallet released patches or warnings. Wallets that don’t yet support 7702 are not suddenly made insecure. But confusion <a href="https://x.com/0x_AgentSmith/status/1921574316040454548">spread</a> with viral tweets claiming EIP-7702 made hardware wallets “no longer safe,” for example.



Will Hennessy, a product manager at Alchemy, strongly pushed back on that narrative:



“It’s a non-issue for end users,” he told Blockworks. “No wallet supports signing arbitrary delegations, nor is there a wallet RPC for a dapp to request an arbitrary delegation signature.”



He’s right…today. Mainstream wallets like <a href="https://blockworks.co/tag/metamask">MetaMask</a> and <a href="https://blockworks.co/tag/ledger">Ledger</a> don’t expose a method for signing EIP-7702 authorization tuples — the term for the one-time-use permission slip, signed by the wallet owner.



But that’s beginning to change. Embedded wallet SDKs — including Alchemy’s own Account Kit — already include a method called signAuthorization that creates valid EIP-7702 signatures. These products can bypass the <a href="https://eips.ethereum.org/EIPS/eip-1193">EIP-1193</a> standard entirely by bundling their own provider. As wallets begin to natively support smart accounts, this functionality will likely spread.



“The article describes signing a message with a wallet from a malicious website,” Hennessy added, “but it is not possible for any website to request an EIP-7702 delegation signature from an external wallet.”



Keep an eye on this threat vector. Just as existing standards have been exploited in “<a href="https://blockworks.co/news/security-firms-react-to-bybit-hack">blind signing” attacks</a>, the same could happen with EIP-7702 if wallet UX isn’t explicit about what the user is delegating and to whom.



TL;DR — the criticism of 7702 as an “auto-drain” threat is exaggerated. There is no magical backdoor, and attackers still need your signature. But the phishing risk is there if wallets don’t clearly show the contract, <a href="https://app.blockworksresearch.com/glossary/#nonce-which-stands-for-number-only-used-once">nonce</a> and scope of a delegation.



So, don’t sign opaque 32-byte hex strings, people. Favor wallets that flag EIP-7702 requests and simulate the delegated contract. Pectra opens the door to powerful smart account features, but remember, with great power…



<figure class="wp-block-image is-resized"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXc5QPbFh7b3V0Ao_C7lG1sYes9-xOe_tgmyP8KAW_k_KmPx1wFvjZtfu0H9rRiEXlLtDhWStkxv5qwS8ldcgsNxVlqAY0-3t0GjtHL3a11X07QwbBRS1dkfXVDatUQ2TS2XWsEfEg?key=fATPsJ4nUj3pjzttTi_B_Q" alt="" style="width:629px;height:auto"/></figure>



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0xResearch Newsletter

Ethereum smart wallet mode panic, unpacked

Ben Strack

Amid the shifting regulatory landscape, crypto firms are expanding their US footprint and ramping up hiring across policy, compliance, and go-to-market roles.



Companies looking to capitalize on <a href="https://blockworks.co/news/washington-dc-blockchain-summit-takeaways">US opportunities</a> are hiring policy and compliance pros, as well as leaders focused on “go-to-market” strategies, recruiters told Blockworks.  



Wintermute became the latest to reveal a new US headquarters on Thursday. The crypto-focused trading firm’s New York office will focus on business development and partnerships, a spokesperson told Blockworks — with managing director David Micley leading those efforts.&nbsp;



Ron Hammond, a former government relations director at Blockchain Association, is set to lead Wintermute’s policy engagement in the United States.



Wintermute currently employs about 100 people in London and 25 people in Singapore. Its projected US headcount for this year is 10, with Wintermute CEO Evgeny Gaevoy telling Blockworks the firm plans to add policy, legal and compliance leaders in New York.



“The US is at a pivotal moment in shaping digital asset market structure,” Gaevoy said. “While we remain policy agnostic, this is the right time to be part of the conversation and offer our expertise.” On the commercial side, being “on the ground” allows Wintermute to engage directly with new and existing counterparties, the CEO explained.



While London and Singapore have historically offered clearer crypto regulatory frameworks than the US, the new office “follows the country’s greater openness toward digital asset innovation and large financial institutions’ accelerated adoption of the asset class,” Gaevoy added.



Wintermute’s New York office announcement came a couple weeks after MoonPay said its new 5,000 square-foot space in Manhattan would be the “central hub” for its growing US staff.



MoonPay now has roughly 70 people in the US, representing about 20% of its global workforce. That is second only to the UK, where the company opened its largest office last year.



Keith Grossman, MoonPay’s president of enterprise, is set to lead the New York City office, a spokesperson told Blockworks. Espi Elio, a VP of operations, and Treasurer Derek Yu will also be based there, along with the company’s directors of social media, engineering, solutions engineering, partnerships and accounting.



The New York office will be the base for various MoonPay legal professionals too, including two of its deputy general counsels. The company is looking to fill a <a href="https://jobs.lever.co/moonpay/539ada88-7654-4885-b7c4-f0036e0b7195">position</a> for a senior product director focused on stablecoins as well.



“We plan to hire across a range of roles, which may include product, compliance, operations, engineering and more,” the representative added.



Just as Wintermute and MoonPay cited US regulatory developments as a reason to open a new site, so too did Crypto.com upon last week opening its new Washington DC office. That location will focus on public and government affairs work, the company noted in a May 7 release.



Matt David, the company’s North America President and Chief Corporate Affairs officer, called the US market “the most exciting frontier for our entire industry” in a statement.



This new office follows the crypto platform last year creating a North American headquarters in Tyler, Texas.



A company spokesperson declined to comment further.&nbsp;



<h2 class="wp-block-heading">Building out US workforces</h2>



WorkInCrypto.Global founder Sam Wellalage said many of his European clients are thinking about how to boost their presence in the US.&nbsp;&nbsp;



“There’s a growing sense of urgency, partly driven by the perception that Trump-era policies and ongoing de-regulation are making it easier for crypto businesses to set up in the US and acquire both retail and institutional customers more quickly,” he said.



Wellage added: “It’s also widely acknowledged that the US has access to some of the best crypto talent globally.”



The most common roles Wellalage has helped clients fill have been what he called “go-to-market” positions. Those include sales directors, as well as heads of commercial and heads of revenue roles.&nbsp;&nbsp;



“Marketing roles like growth marketing and digital marketing are also in high demand,” he said.



Zachary Plotkin, a managing partner at recruiting firm Madison-Davis, said most of the small and midsize crypto companies he’s seeing expand to the US are looking for technology, compliance, risk and data security professionals.



“I have noticed that more of these firms are willing to hire a temporary chief compliance officer, a temporary chief risk officer or temporary [Bank Secrecy Act] officer that can handle the load of the work to see if the firm&#8217;s US footprint can expand,” he said.



Crypto exchange OKX, which last month debuted its US headquarters in San Jose, California, is searching for a US-based head of risk strategy, a head of product compliance and a senior compliance manager focused on anti-money laundering investigations.



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crypto hiring

As crypto firms boost US footprint, the race for talent is on

David Canellis

Pete Rizzo

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



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Bitcoin Pizza season is back.



This Sunday will mark 15 years since early adopter Laszlo Hanyecz first posted his historic, cheesy request to Bitcointalk: <a href="https://bitcointalk.org/index.php?topic=137.msg1141#msg1141">Pizza for bitcoins</a>?



Hanyecz boldly offered to pay 10,000 BTC to anyone who could deliver two large pizzas — two, “so I have some left over for the next day. I like having leftover pizza to nibble on later.”&nbsp;



Those coins were worth about $42 at the time and more than $2 billion today, enough to make your stomach grumble!&nbsp;



In many ways it was the most important transaction in Bitcoin’s history, even to this day. As Laszlo put it best: “Somebody had to start it off.”



<h2 class="wp-block-heading">Bitcoin Legends — Laszlo Hanyecz</h2>



Long-time subscribers to Supply Shock, from when it was called Bitcoin History, might remember our feature profile on Hanyecz from last year.&nbsp;



It does a fantastic job of plotting Hanyecz’s legacy, from early miner, to Satoshi collaborator, to Bitcoin Pizza Guy and beyond. Be sure to <a href="https://bitcoinhistorynl.beehiiv.com/p/laszlo-hanyecz-bitcoin-legend?utm_source=bitcoinhistorynl.beehiiv.com&amp;utm_medium=newsletter&amp;utm_campaign=laszlo-hanyecz-is-a-bitcoin-legend">check it out in our archives</a>.



This time around, let’s collect a few slices of the story that are sometimes left out.



<h2 class="wp-block-heading">1. Hanyecz kept spending bitcoins on pizza.&nbsp;</h2>



In June 2010, about a month on from the original purchase, Laszlo posted: “This is an open offer by the way. I will trade 10,000 BTC for 2 of these pizzas any time as long as I have the funds (I usually have plenty). If anyone is interested please let me know.”



By August of that year, Laszlo cut the experiment short due to demand. The bitcoin hash rate had multiplied by more than 26 times since his initial offer, a monster jump attributed to <a href="https://x.com/pete_rizzo_/status/1890763182555197539">pioneering pseudonymous miner ArtForz</a>, who’d built their own GPU mining software and kept it private for a competitive edge.



“Well I didn&#8217;t expect this to be so popular but I can&#8217;t really afford to keep doing it since I can&#8217;t generate thousands of coins a day anymore. Thanks to everyone who bought me pizza already but I&#8217;m kind of holding off on doing any more of these for now.”



<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">5/ Laszlo was one of the first 5 developers to work on <a href="https://twitter.com/hashtag/Bitcoin?src=hash&amp;ref_src=twsrc%5Etfw">#Bitcoin</a>. Here’s Satoshi crediting him for his work helping to test and review the 3rd version of the software in history 🏆 <a href="https://t.co/vEjTX2oySB">pic.twitter.com/vEjTX2oySB</a>&mdash; The Bitcoin Historian (@pete_rizzo_) <a href="https://twitter.com/pete_rizzo_/status/1829158445905301666?ref_src=twsrc%5Etfw">August 29, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
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Laszlo would share in 2014 that he’d spent every coin he mined on pizza. His bitcoin <a href="https://mempool.space/address/1XPTgDRhN8RFnzniWCddobD9iKZatrvH4">address</a> shows him receiving 81,432 BTC, presumably from his mining operations, with the same in outgoing transfers representing his pizza trades.&nbsp;



So, if what Laszlo says is true, that would mean he spent today’s equivalent of $8.45 billion on pizza.&nbsp;



If he’d held until today, Laszlo would only be $1.5 billion short of Michael Saylor on Forbes’ billionaires rich list. But he <a href="https://www.coindesk.com/markets/2020/05/22/10-years-after-laszlo-hanyecz-bought-pizza-with-10k-bitcoin-he-has-no-regrets">doesn’t seem to mind</a>.



<h2 class="wp-block-heading">2. The other guy also sold his bitcoins.</h2>



Jeremy “Jercos” Sturdivant was only 18 when he used his credit card to buy pizza for Laszlo from across state lines.



Jercos wasn’t an active poster on Bitcointalk and instead coordinated the deal with Laszlo via IRC, where the two had already crossed paths. It was on IRC that Studivant first learned of Bitcoin, and thought it interesting in light of the failure of e-gold around the same time.



He was even a bitcoin miner in his own right, “probably mining several thousand coins” by remotely running a cpuminer through Linode’s cloud computing service.



Studivant has shown similar grace as Laszlo when asked if they regret the experiment.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXdlB3T2YnkceGEIu3vwk_bHSQOkixjqVxA8x_CcLkoc-OmP2RJr7PJKH85dQIqm7wC8OhHYkIG10XAHF8C2OiSTXnpmJh1R_xhqE4cxZMMQOqZWGLy9JBDv0su0Wjcf8VTrYcYilA?key=i5DYGJeOmBGtu_z4AmZ77w" alt=""/></figure>



“Bitcoin as a currency is meant to be spent,” he said in an <a href="https://www.bitcoinwhoswho.com/jercosinterview">interview</a> from 2015. “&#8230; Naturally there will always be people hoarding coins, trying to get rich, and quite a few people did get quite rich, but they wouldn&#8217;t have got that way without economic growth allowing it.”&nbsp;



At the time, Jercos appeared to still be sitting on quite a few coins, and was indeed using them as money.&nbsp;



“To that extent my bitcoin holdings do usually measure in hundreds or thousands of USD, simply because I use them much as I would a checking account, to conduct business both online and offline when I have the opportunity.”



“Notably the ‘humble bundles’ and the attached store accepting bitcoins significantly bolstered my video game library.”



<h2 class="wp-block-heading">3. Satoshi invented GPU mining before Laszlo.</h2>



The mainstream mostly knows Hanyecz as the Bitcoin Pizza Guy.&nbsp;



Around these parts, across the Rubicon, he’s also well-respected for porting Bitcoin Core to macOS in the space of a week, and being the first person ever to mine bitcoin with a GPU, even before ArtForz.



It could be that Satoshi had beaten Laszlo to the punch. In an <a href="https://cointelegraph.com/news/satoshi-invented-gpu-mining-to-defend-the-network-says-early-dev">interview</a> from May 2020, Hanyecz said that Satoshi had already invented GPU mining as a sort-of-secret Death Star to protect Bitcoin from 51% attacks.



“And he actually shared with me his version of it,” Hanyecz said, after he’d shown his own GPU mining code to see what Satoshi thought. Satoshi then famously cautioned Hanyecz in private over potentially developing GPU miners too quickly.&nbsp;



“So even though it wasn&#8217;t in Bitcoin, he did have GPU mining code and he said he was just keeping it ready in case he had to defend the network with it.”



In late 2009 on Bitcointalk, Satoshi softly <a href="https://satoshi.nakamotoinstitute.org/posts/bitcointalk/20/">pushed</a> for “a gentleman’s agreement to postpone the GPU arms race for as long as we can for the good of the network,” which looking back is quite interesting phrasing, considering they were already sitting on serious firepower.



<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">9/ Rather than quit mining, Laszlo decided to give back to <a href="https://twitter.com/hashtag/Bitcoin?src=hash&amp;ref_src=twsrc%5Etfw">#Bitcoin</a>. In fact, he dusted off one of Satoshi’s own ideas – taking an example from the official Bitcoin FAQ. <a href="https://t.co/zfc895dLrV">pic.twitter.com/zfc895dLrV</a>&mdash; The Bitcoin Historian (@pete_rizzo_) <a href="https://twitter.com/pete_rizzo_/status/1829158545876529509?ref_src=twsrc%5Etfw">August 29, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



The legacy of Laszlo and Jercos within the context of Bitcoin Pizza Day is largely ironic. Bitcoin is absolutely money, and anyone who swapped bitcoins for pizza with Laszlo or anyone else was absolutely reasonable to do so.&nbsp;



Money is for spending, just like Jercos said, and the term HODL would only be coined three and a half years after the first Bitcoin Pizza Day.



At the same time, bitcoins became so valuable so quickly that these days, actually spending them is instinctively viewed as tempting fate.&nbsp;



Nobody wants to accidentally spend billions of dollars on pizza. And that’s precisely why Laszlo will forever be a Bitcoin Legend.



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Bitcoin

3 piping hot Pizza Day facts for Bitcoin connoisseurs

Katherine Ross

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



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The Department of Justice will continue its case against Tornado Cash’s Roman Storm.&nbsp;



Previously, the DoJ said it was going to reconsider, after an <a href="https://www.justice.gov/dag/media/1395781/dl?inline">internal memo</a> from Deputy Attorney General Todd Blanche said that the department would “stop participating in regulation by prosecution in this space.”



There was a slight change in the case, per the letter, which will drop the charge of Storm allegedly not complying with the money-transmitter business registration rules.&nbsp;



Storm now faces a trial, and the remaining charges are focused on money laundering.&nbsp;



ICYMI: Storm is one of the founders of <a href="https://blockworks.co/tag/tornado-cash">Tornado Cash</a>, which has had a <a href="https://blockworks.co/news/ny-fed-tornado-cash-report">bumpy road</a> with the US government (though it recently received a <a href="https://www.coindesk.com/policy/2025/04/29/tornado-cash-can-t-be-sanctioned-again-texas-judge-rules">court win</a> when a judge ruled it can’t be sanctioned again by the government). The DOJ initially <a href="https://blockworks.co/news/roman-semenov-tornado-cash-ofac-list">charged Storm</a> back in 2023 alongside his co-founder Roman Semenov. 



In the April memo from Blanche, he outright said that the DOJ will focus its cases on the bad actors who are using the various platforms, rather than the platforms or the developers themselves.&nbsp;



Here’s Blanche’s direct quote: “The Department will pursue the illicit financing of these enterprises by the individuals and enterprises themselves, including when it involves digital assets, but will not pursue actions against the platforms that these enterprises utilize to conduct their illegal activities.”



The DeFi Education Fund noted that the dropped charge is “consistent” with the April memo.



<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">Today, the DOJ filed notice it is dropping the Section 1960(b)(1)(B) charge against <a href="https://twitter.com/rstormsf?ref_src=twsrc%5Etfw">@rstormsf</a> in U.S. v. Roman Storm, but will continue to trial on other charges. While this was consistent with an April 2025 DOJ Memo, calling for the end to “regulation by prosecution” and for the… <a href="https://t.co/STDP2xXzP2">pic.twitter.com/STDP2xXzP2</a>&mdash; DeFi Education Fund (@fund_defi) <a href="https://twitter.com/fund_defi/status/1923100662147035538?ref_src=twsrc%5Etfw">May 15, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



It seems that, even with the changes, this potential trial sets up a tricky situation — with the US just opening up, is there a possible precedent set legally that could impact developers?&nbsp;



Potentially.



Variant Fund’s Jake Chervinsky said in a post on X that the case “should end, period.”



<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">DOJ clearly ordered the end of regulation by criminal enforcement in crypto. But SDNY dropped only one of many inappropriate charges against Roman Storm. Like spitting in DOJ’s face. This is why people call it the Sovereign District of New York. The case should end, period. <a href="https://t.co/JXdJSg7aDf">https://t.co/JXdJSg7aDf</a>&mdash; Jake Chervinsky (@jchervinsky) <a href="https://twitter.com/jchervinsky/status/1923113075139322090?ref_src=twsrc%5Etfw">May 15, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Back in April, Paradigm chief legal officer Katie Biber <a href="https://x.com/katiebiber/status/1914392536795455822">wrote</a>, “If developer liability is unlimited and tied to the conduct of unknown third parties, no developers will want to build in America. It destroys the innovation economy here and ships crypto, AI &amp; all nascent tech offshore.”



DEF, in another post, said that the case moving forward with the current charges means that the prosecutors are arguing that Storm “‘[transferred] funds on behalf of the public,’ pursuant to 1960(b)(2), which means the accused must have custody and control over other people’s funds.”



<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">In short, the DOJ will continue with its illogical and unlawful theory of money transmission. For any Section 1960 charge, the accused must be “transferring funds on behalf of the public,” pursuant to 1960(b)(2), which means the accused must have custody and control over other…&mdash; DeFi Education Fund (@fund_defi) <a href="https://twitter.com/fund_defi/status/1923100664881942651?ref_src=twsrc%5Etfw">May 15, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



“That is plainly not the case with software devs of noncustodial p2p protocols, and under any fair reading of the law, both charges should be dismissed,” DEF continued.&nbsp;



So now Storm heads to trial, and this could be a very important one to keep an eye on for the space.&nbsp;



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DOJ moves forward with trial for Tornado Cash’s Roman Storm

BitGo, the leading infrastructure provider of digital asset solutions, today announced that it has partnered with GlobalStake to deliver a next-generation institutional staking solution combining best-in-class security, sustainability, and scalability. As BitGo’s first fully bare-metal staking partner, GlobalStake’s infrastructure will be integrated directly into all BitGo institutional client UIs for SOLANA, ETHEREUM, BNB, POLKADOT, and the new WALRUS NETWORK from SUI, with more asset support to follow, allowing for direct staking through a unified and trusted interface.



“BitGo has earned its reputation as a trusted custodian for institutions, and GlobalStake’s expertise in secure, bare-metal, and carbon-negative staking solutions further elevates our offerings,” said Mike Belshe, CEO of BitGo. “As our first partner operating exclusively on bare-metal infrastructure, GlobalStake brings an alternative approach that complements the diverse staking options we provide  institutional clients.”



<h3 class="wp-block-heading">A TradFi Approach to Institutional Staking</h3>



This partnership reflects BitGo’s ongoing mission to deliver secure, flexible, enterprise-grade staking options to clients across leading digital assets. GlobalStake addresses the most pressing needs of institutional investors, including mitigating the risks associated with cloud dependency, ensuring top-tier security, and facilitating seamless scaling across multiple blockchain networks. GlobalStake is pioneering the MultiStake model, which evolves the traditional finance concept of “multi-prime.&#8221; This strategy encourages institutions to diversify their staking activities across multiple providers, hardware, and approaches to reduce risks, enhance capital efficiency, and optimize returns. Key highlights of this collaboration include:



<ul class="wp-block-list">
<li>Unmatched Security: GlobalStake&#8217;s SOC 2 Type II and CCSS (imminent) certifications guarantee institutional-grade security for your assets. These certifications establish a gold standard in security, enhanced by BitGo’s proven custody platform, which has protected digital assets since 2013.</li>



<li>Exclusive Reporting Powered by MG Stover: MG Stover, a recognized leader in digital asset reporting, has partnered exclusively with GlobalStake to offer clients best-in-class, institutional-grade staking reports. This collaboration enhances transparency, simplifies audits, and streamlines back-office integration for fund managers and allocators.</li>



<li>Unparalleled Choice &amp; Performance: GlobalStake provides complete control and flexibility. Stake across over 40 blockchains, choose specific jurisdictions for regulatory compliance, and experience exceptional global performance with our independent, custom staking-tuned infrastructure.</li>



<li>Sustainability: Stake with a Conscience: GlobalStake is 100% carbon-negative, removing more greenhouse gases than it generates. The more you stake with GlobalStake, the more significant the positive impact on the environment.  </li>



<li>Cost-Efficiency &amp; Higher Returns: Thanks to GlobalStake&#8217;s self-owned infrastructure, this partnership translates to competitive pricing, allowing you to maximize returns on your staked assets.</li>
</ul>



“We are honored to partner with BitGo, a pioneer in institutional-grade digital asset solutions,” said Rich Shorten, Co-Founder &amp; Chairman at GlobalStake. “This collaboration represents a new chapter in secure and scalable staking solutions for institutions. With BitGo’s world-class custody services, we offer a combined solution with unmatched value that can exceed TradFi standards for enterprise-grade infrastructure, stringent risk controls, spectacular performance, vendor diversity, and environmental responsibility.”



<h3 class="wp-block-heading">About BitGo</h3>



BitGo is the leading infrastructure provider of digital asset solutions, offering custody, wallets, staking, trading, financing, and settlement out of regulated cold storage. Founded in 2013, BitGo is the first digital asset company to focus exclusively on serving institutional clients. BitGo is the world’s largest independent digital asset custodian, with multiple regulated entities worldwide and over 2,000 clients in 90 countries.&nbsp;



For more information, visit: <a href="http://www.bitgo.com/?utm_source=blockworks">www.bitgo.com</a>



<h3 class="wp-block-heading">About GlobalStake</h3>



GlobalStake is the leading next-generation non-custodial institutional staking platform. Through self-owned, Web3-tuned bare-metal infrastructure, we deliver superior security, diversification, and returns. Operating globally in Tier 4/5 data centers, GlobalStake is SOC 2 Type II and CCSS certified and committed to sustainability, with 100% carbon-negative operations.



For more information, visit: <a href="http://www.globalstake.io/?utm_source=blockworks">www.globalstake.io</a>



<h3 class="wp-block-heading">Media Contacts:</h3>



BitGo Press press@bitgo.com



Jordan Knecht Global Head of Institutional Strategies and Partnerships, GlobalStake jknecht@globalstake.io



This content is sponsored and does not serve as an endorsement by Blockworks. The veracity of this content has not been verified and should not serve as financial advice. We encourage readers to conduct their own research before making financial decisions.



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GlobalStake and BitGo partner to deliver enhanced institutional staking solutions

Byron Gilliam

This is a segment from The Breakdown newsletter. To read full editions, <a href="https://blockworks.co/brand/the-breakdown">subscribe</a>.



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<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">
&#8220;The value of all Wares arise from their Use; things of no use, have no value.&#8221;&nbsp;



— Nicholas Barbon (1690)
</blockquote>



Q: What did dinner with the president cost?



The final TRUMP holder to qualify for <a href="https://trumpdinner.gettrumpmemes.com/leaderboard">dinner with the president</a> held 4,196 tokens, which were worth about $60,000 at the cut-off.



But that’s not the cost of the invite, because holders were free to sell as soon as the period or record ended.



If they did, they would have taken about a 10% loss, making the real cost of dinner with the president (and 219 others) about $6,000.



This is a bargain!



For comparison, a Super PAC <a href="https://www.wired.com/story/people-paying-millions-donald-trump-mar-a-lago/?utm_source=chatgpt.com">sold tickets</a> in March to a “candlelight dinner” with the president for $1 million each — 166x more!



Donors were also offered a one-on-one meeting with the president for $5 million.



That, I think, seems roughly on par with the 25-person VIP meetup for TRUMP token holders, which cost at about $240,000 for those who sold immediately after qualifying.



Many did sell, including the last VIP qualifier, whose wallet now shows a balance of zero TRUMP.&nbsp;



Roughly 40 others also sold as soon as they had qualified — including several mature jokesters who reduced their holding to 69 tokens (the conversation at dinner will be riveting, I’m sure).



There might be consequences for gaming the contest like that — I’m guessing the zero and near-zero holders will be seated further away from POTUS, at the very least.&nbsp;



But the 220th holder appears to be a true believer: They <a href="https://solscan.io/account/8AovnumJUHq1hM8VUbFdbhPV26u5xqUxFVjK3QtzkD59">doubled</a> their TRUMP holdings after the contest ended.



Might that earn them a <a href="https://www.cnn.com/2017/05/11/politics/trump-time-magazine-ice-cream">second scoop</a> of ice cream?



Let’s hope they report back.



Q: Are memecoins making a comeback?



They’re less dead than I thought — forgotten pan flashes like Moo Deng are up as much as 600% over the past week or so.&nbsp;



There were also 63,000 new Solana-based tokens created on Tuesday alone (nearly all of which presumably qualify as memecoins):



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXcU2TpA-FRRu9Ww7nVQePJRTYug2onyzDO86PkBmJPsFi0_aCAcfjTh04XXU19ijHttd_c8Wg73mAlXM4uRTXQOH2OrsEWmTCmyBGKpf0Nf59LZtJ34160Z3Ec0Px8WxizmamHpKA?key=ChJ4r-vpAeosRk-2Ltri8g" alt=""/></figure>



I couldn’t name a single one, however — in fact, I can’t recall the last time I heard about a new memecoin launch.&nbsp;



Memecoins don’t have nearly the mindshare they once did, and the <a href="https://x.com/Awawat_Trades/status/1922156537394389233">list</a> of memecoins that are up this week (Goat, Pnut, Fwog, Popcat…) feels as dated as a playlist of 1970s disco hits.&nbsp;



That’s probably a good sign.



With luck, none of the memecoins created yesterday will get traction — and with a little more luck, that will incentivize crypto investors and builders to reallocate their time and money toward projects that are useful to people.



We’re not there yet — Blockworks Research data shows that memecoins still trade 14x more volume than “project tokens:”



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXc1pvceLWaaP0UKRRfYa7nZXFzbgyg8Sn6nggJJEBPq1Jbflot2sD0v4ORqbvquegdxrV-SySUo6pDnjYD55WtWPxZoDLtevio79VLRKMTjF6J-V7xf73FFpMgm-LKbFGxbmDSoxw?key=ChJ4r-vpAeosRk-2Ltri8g" alt=""/></figure>



Q: Should memecoins be regulated?



They’re collectibles, not securities, so I guess not.



But the purpose of securities regulation is to encourage retail participation in stock markets by giving people the impression that the playing field is level.



So, if the crypto industry wants retail to participate in crypto markets, it might have to self-regulate in some way that gives people the impression that the playing field is level for crypto investors, too.



Memecoins give the opposite impression, as only insiders appear to be getting rich from them.



That’s a problem because you only need to watch kids on a playground argue over the rules of tag or kickball to know that a game that doesn’t seem fair won’t last very long.



Q: Would HYPE be 4x more valuable on the stock exchange?



It was fun to <a href="https://x.com/Keisan_Crypto/status/1922731410282189225">hear</a> David Balin, formerly the chief investment strategist at Citi, cite Hyperliquid as an example of how traditional investors might diversify their investment portfolios.



In response to the host’s typical question about the intangible value of crypto, he responded, “It’s true that memecoins and NFTs and stuff don’t generate revenue but there’s a handful of others that are online that literally generate revenue every day and you can see it.”&nbsp;



True!



He does unfortunately get -1 point for repeatedly saying “online” when he means “onchain.”&nbsp;



But I think that is good news, too — when investors who aren’t totally clear on the difference between online and onchain are interested in something as deep-cut as Hyperliquid is, we’re really making progress.



“This is a company that, were it to be Robinhood or were it to be Coinbase, it would probably be worth 4x what its market cap is in the digital world.”



4x!



I’d be curious to see the math on that, because Hyperliquid trades on about 17x revenue and Robinhood trades on…wait for it…17x revenue.



Hyperliquid probably has much higher margins — it somehow returns all revenue to token holders.



But Robinhood trades on 34x earnings, so even if Hyperliquid has 100% net margins (which is presumably impossible) it would only be 2x undervalued vs. Robinhood.



On the other hand, the stock market values bitcoin held by Strategy (née MicroStrategy) at 2x what it’s otherwise worth and bitcoin promised to a SPAC (Cantor Equity Partners) at 3x what it’s otherwise worth.



So maybe Balin’s right that the stock market would value Hyperliquid at 4x what the crypto market does, who knows.



Q: Is TRUMP a memecoin?



We can quantify this now.



The TRUMP token has not given back all of its gains from before the dinner contest was announced, which implies that holders believe it will continue to have utility above whatever value it previously had as a memecoin.



Specifically, the additional $700 million of market capitalization it’s retained might be seen as the present value of future TRUMP utility.



TRUMP’s market cap is $2.6 billion, so I’d argue it’s now 75% memecoin and 25% utility token.



If $700 million sounds like a lot, consider that Roger Ver paid a lobbyist <a href="https://www.wsj.com/politics/policy/the-wild-west-of-presidential-pardons-in-trumps-second-term-a250160f?mod=djem10point">$600,000</a> to try to get the president’s attention on his behalf; there’s a waiting list to pay $500,000 to get into Donald Trump Jr.’s new private club <a href="https://www.cnbc.com/2025/04/28/donald-trump-jr-private-members-club-executive-branch.html">“Executive Branch</a>” which promises access to lesser government officials; and Qatar has offered the president a $400 million airplane — presumably to stay in his good graces.



Relative to that, the TRUMP coin seems like a much cheaper way to get the president’s attention.



Could crypto disintermediate DC lobbyists?



It’s not the use case anyone was hoping for, but it has real value, for sure.



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The Breakdown Newsletter

Thursday Mailbag: Dinners, memecoins and lobbyists

Jack Kubinec

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XP, a ticketing resale exchange built with Solana rails, has raised $6.2 million in a seed round led by Blockchange, the platform tells Lightspeed exclusively.



L1D and Reflexive also participated in the round. XP uses Solana rails for discounted ticket sales, but hints at grander ambitions surrounding fan experience down the road.&nbsp;



XP is one of a number of upstart ticketing exchanges seeking to disrupt the popular but widely-disliked incumbents such as TicketMaster and SeatGeek. These ticketing titans caught the ire of the Biden administration, which just had a rule banning hidden so-called junk fees from ticketing platforms go into <a href="https://www.pbs.org/newshour/nation/a-biden-era-junk-fee-rule-is-now-in-effect-ticketmaster-says-it-will-display-fees-more-clearly">effect</a> on Monday.



XP lists all-in prices by default. Its listed prices for tickets to upcoming New York Mets games roughly track with prices on TickPick, another popular resale ticketing app.



The Solana of it all <a href="https://solana.com/news/case-study-xp">comes</a> from the ticketing codes, which are encrypted as NFTs. You wouldn’t know that from browsing the website, though — the only apparent crypto mention is the option to connect a crypto wallet and pay for tickets in USDC.



“XP has sold millions of dollars in annualized ticket sales to thousands of customers,” XP founder and CEO Mike Saunders said when I asked about the platform’s traction. He did not give a firm answer when I asked if XP would be launching a token.



Saunders has been around the block: His 1990s food ordering and menu website company was acquired by GrubHub in 2011. Saunders went on to found a tech development shop named Blueprint before starting XP, which is his first foray into blockchain.&nbsp;



I actually met Saunders briefly at the Solana Boston conference in October, where I recall him saying he thinks about his startup constantly and obsessively.&nbsp;



But whether all that thinking creates venture-scale returns following this fundraise may depend on XP’s coming expansion. Ticketing marketplaces are a crowded field, and with the Biden junk fees rule in effect, transparent pricing may become a bit less of a selling point.&nbsp;



On its site, XP teases that the platform will soon be about “more” than just tickets. Saunders also added that XP has plans in the works for users to be able to list and resell their own tickets.&nbsp;



“Fandom is deeply personal, and we believe blockchain unlocks a whole slew of opportunities for fans to be recognized, celebrated and rewarded,” Saunders said. “Our goal is to leverage verified fandom to provide access to special rewards, epic experiences and exclusive perks to members of the XP community.”



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Lightspeed Newsletter

Solana ticketing platform XP raises $6.2M

Felix Jauvin

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



We’re entering the phase where we can see the impact of tariffs on the economy and gauge how companies are responding to these price increases.



We’d forgive you for not knowing what the current <a href="https://blockworks.co/news/inflation-april-rose-less-tariff-impact">tariff rates</a> are, considering they change quite frequently. As for the China 90-day <a href="https://blockworks.co/news/big-tech-stocks-tariffs-ai">pause agreement</a>, the aggregated effective tariff rate is somewhere around 12.6%:



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXf0aCT3iqaVYGh0OpS2VVnmVjp1uBwCMq9dbXShpKpCovc0bsxOOVJzoHav4zSJHWiXBSlSJosBc1idI6cqtN32G63Bo40xf8TKjpkwJC7hg60MQqXw7tawh6i6h1tlsoAkIEzn?key=7Beeripi-Yq_O-ch2f0yhA" alt=""/></figure>



We’re now also seeing tariff revenue actively being collected:



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXftGjohIKHMwS9eP252xCKctzSA9Y6ojTqd7qUdQZ8BE3ObXqyc6P169dHBsgUu2pmt0JWalkB2_UgxsJVAtcO0lZcdJOpLH4DgfrKmQ1998BjNyZ8CLo6M6Q3EXI1R6uStNiBeGQ?key=7Beeripi-Yq_O-ch2f0yhA" alt=""/></figure>



We’re now well within the phase where corporations must decide to either absorb cost increases or pass them onto consumers. The result of this calculus will set the stage for how the economy navigates the next 12 months and who bears the brunt of it.&nbsp;



Some of the economic data released today hints at the answer:



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



We saw a huge downside miss in PPI today. When you dig into the data, it becomes apparent that the miss was largely caused by a big decrease in portfolio management fees.&nbsp;



This was due to the market crash in April:



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXckjpoORpfuxlb-oE4ZimSxqusQ3rCm8k5VcC6lM0xOKnzGuONXB3ZNVWPHPwTE1RAmKJqCDXb0rn1_AkzHVONkqMBYCnanB8uvsBOoxP_HkB7iw0PQd7Y3c5Vy2PNDi3RsvbJh-g?key=7Beeripi-Yq_O-ch2f0yhA" alt=""/></figure>



This downtick masked interesting insights into how much price increases are being passed to consumers vs. being absorbed by corporations.&nbsp;



Economist Parker Ross <a href="https://x.com/Econ_Parker/status/1923039680766857580">outlined</a> how most of the increases are being absorbed by corporations, for now:



“So far, it looks like the impact of tariffs is generally not being meaningfully passed on to consumers, but they do appear to be getting passed on to businesses.”



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXeVdPWdqWSZrKAXSuontOkjpTOgVc8o4PLsGmlHxCf5woS7sa_CTgCrzC2alRp4GHNPaoeq_CsehhtTqnr08GkmFdj5lEX2you6y4d0FOuG58f2-Qtx49crKspyYXc3TDPuFTJ6Tw?key=7Beeripi-Yq_O-ch2f0yhA" alt=""/></figure>



“We see this in the limited acceleration in PPI for core finished consumer goods contrasted against the sharp acceleration in PPI for private capital equipment to 0.61%, the strongest monthly gain outside of the pandemic since 2008.”



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXek-GeZPplGtI2WtWSZJqgJO2VYZiyIuctcgPBXqMzA0IdvnjbPJECve1CSryrEcYlhj0zyBhA6B6JjsOLDziXal7JnRQmpdMmTFD3BdbbmAeCMoGUjBAnV0YHsGI9BzXi7jzYZYQ?key=7Beeripi-Yq_O-ch2f0yhA" alt=""/></figure>



<h2 class="wp-block-heading">Retail sales</h2>



We also received the retail sales print today, which illuminates how consumption habits are shifting based on the tariff implementation.&nbsp;



Categories not impacted by tariffs (like food services) surged. On the other hand, categories heavily impacted by tariffs, such as big box retailers and sporting goods —&nbsp;where a lot of frontrunning occurred before the tariffs went live —&nbsp;are now cratering:



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXeq4UsDdx0y-iy3-bzm_SZzCRdCi8y_KQU_o06s0KnnZA803T5CJBO7jQ1jpuByYJAJYUHtQ8a1rdW6g4PhOvkcfquxsaVFe2-Or4vrJY4otTirABffOCLxonFqEx9ClDq9mpp-rQ?key=7Beeripi-Yq_O-ch2f0yhA" alt=""/></figure>



This dynamic is a small example of what is likely to happen as the economy digests tariffs: frontrunning before the tariffs, then a singular price level increase, then demand destruction as higher prices lead to decreased demand.&nbsp;



As we navigate the next few months, the economic data will be extremely noisy.&nbsp;



As we can see from these two prints, it’s essential to dig beneath the topline numbers to better understand what’s driving the numbers.



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Forward Guidance newsletter

Parsing the data for hints of US tariff impacts

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



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Blockchain gaming has gone through various cycles of sentiment.



These cycles include 2017, with CryptoKitties, and 2018, with games like Axie Infinity, Gods Unchained and Splinterlands.&nbsp;



While some might think crypto gaming is in decline these days, venture capital firm Bitkraft Ventures doesn’t see it that way.



“Not only is it not dead, but its future is as bright as almost any category,” Matt Halstead, a new venture partner at Bitkraft, told me in an interview.



The firm counts AMGI, <a href="https://blockworks.co/news/immutable-ubisoft-tcg-might-and-magic">Immutable</a>, HyperPlay and Yield Guild Games among their 100+ portfolio companies, plus non-crypto firms like Discord and Epic Games. Bitkraft obviously stands to benefit from crypto gaming’s success, but they’re also investing in what they believe the future will look like.



“One bet that I would be, you know, very happy to make is that gaming will not only exist, but it will be multiples bigger than it is today. And I just don’t think you can look at the world and have that level of conviction in too many themes. And so I think to ignore gaming will be proven to be a big mistake,” Halstead added.



After the play-to-earn run subsided in early 2022 — when tokens like Axie Infinity’s AXS token fell roughly 91% in less than six months — some upstart crypto game studios touted a “play-and-earn” narrative.&nbsp;



A number of crypto games studios told me around that time that the industry needed to get away from the farming-focused financialized games, arguing that their games would put gameplay before their economies to “make a good game first.”&nbsp;



Around that time, some game studios and investors held the view that in-game items would become interoperable, and that NFTs would be part of that vision.



But crypto gaming’s once-touted vision of interoperable in-game items as assets on the blockchain hasn’t quite panned out — especially when hype around the metaverse faded in 2023.&nbsp;



Halstead suggested the prevailing sentiment toward crypto gaming is something that’s a problem across crypto: There’s a very short feedback loop where expectations don’t always meet reality.



“I just think there’s a fundamental lack of understanding of games in general,” he added.



So how could crypto organically fit into games, and where will we see future success?



Halstead sees the creator economy, cosmetic items, and the social element of gaming as areas that could do well with blockchain integrations going forward.&nbsp;



But there’s also the obvious, continued fit of more financial-forward games, or “GameFi” titles, wherein a betting element or gambling element is offered with an entertainment layer on top.



Bitkraft General Partner Carlos Pereira predicts that this year, we’ll see a solid AI-native crypto game release. But “risk-to-earn” is also a big subgenre.



Loot Labs is one of Bitkraft’s most successful portfolio companies right now, Pereira told me. Loot Labs offers buyers mystery assets as NFT loot boxes, whereby you spin a wheel and don’t know what you’re going to get.&nbsp;&nbsp;



“And so as long as you acknowledge that there’s this concept of risk-to-earn,” Pereira said, “that’s totally okay. And we’ve had these games for a long time, and there’s fit with crypto. [And] there’s still the space for all the other types of games.”



Bitkraft advises all their portfolio game studios against selling NFTs or launching a token before the game releases because that approach sets high expectations — and puts studios in a bind if they fail to meet those expectations by backing out or adjusting earlier plans.



“We certainly believe that on average, the right decision is not trying to monetize your community too early [&#8230;] and that’s not what the average games have done,” Pereira said. “Of course, we have had things that fail. Of course, we’re in the business of making mistakes, and then hopefully when we don’t make a mistake, it’s a really good thing. But you haven’t seen us attached to the games that raised a bunch of money on a launchpad, or the games that sold $40 million in NFTs.”



Updated at 1:04 p.m. ET on 5/16/25 to accurately describe a venture partner, and with new logo image.



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Gaming

Why crypto games shouldn’t monetize too early

One of the SEC’s next <a href="https://blockworks.co/news/sec-grayscale-solana-etf">crypto ETF rulings</a> could prove a milestone for investors seeking to diversify their exposure within the segment.



Hashdex CIO Samir Kerbage pointed to the expected SEC decision in July that could allow <a href="https://blockworks.co/news/crypto-etf-filing-optimism-bloomberg">crypto index products</a> to expand the assets they hold.



The Hashdex Nasdaq Crypto Index US ETF (NCIQ), which launched in February, holds both BTC and ETH. Kerbage noted the holdings in that ETFs are “designed to evolve as the market evolves” — referring in part to regulatory developments.



The Brazil-based firm in March sought approval for NCIQ to invest in other assets that the international version of that index <a href="https://www.sec.gov/Archives/edgar/data/2031069/000121390025024262/ea0209567-11.htm#T9912">invests</a> in, such as solana (SOL). Other assets include XRP, cardano (ADA), chainlink (LINK), avalanche (AVA), litecoin (LTC) and uniswap (UNI). 



<a href="https://blockworks.co/news/trump-media-etf-cryptodotcom">Kerbage told me previously</a> Hashdex ultimately wants to create “the Nasdaq 100 for crypto.”



Grayscale filed last November to uplist its Digital Large Cap Fund — holding BTC, ETH, SOL, XRP and AVA at the time — to an ETF. The SEC’s final deadline to rule on that proposal is July 2. Clarity on that specific offering could extend to products by Hashdex, Bitwise and others.&nbsp;



Scott Johnsson, a general partner at Van Buren Capital, is indeed watching that date. He said in an April X post that because the index products have more undefined allocations, the SEC could adopt a general rule (rather than “case-by-case” rules for the proposed single-asset crypto ETPs).



<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">Most interesting part of upcoming crypto ETF season is going to be the index products. Broader implications for the space and set the tone for what comes next. This is really the event to be watching. (1) They&#39;re first on deck. July 2 is the final deadline for Grayscale Digital…&mdash; Scott Johnsson (@SGJohnsson) <a href="https://twitter.com/SGJohnsson/status/1915619368156762388?ref_src=twsrc%5Etfw">April 25, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



“How they address the security question for each of the non-BTC/ETH allocations will draw the most attention,” Johnsson added.



Kerbage told Blockworks he expects to see the SEC allow US products to hold assets beyond BTC and ETH before approving more single-asset crypto ETFs.&nbsp;&nbsp;



“But this is the big question,” he noted. “If they’re not comfortable with having one specific single asset as an ETP, they still might allow an index to have a small allocation to that specific asset.”



Keep reading for more excerpts from Blockworks’ Q&amp;A with Kerbage.&nbsp;



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



Blockworks: You mentioned in March that Hashdex was about to meet with the SEC. What did you discuss, and how do you expect the agency to proceed with the proposed crypto ETPs in front of them?



Kerbage: Our goal was to share the experience we’ve had outside of the US…and what we’ve seen working and not working. We think the SEC could approach this space by setting up a listing standard that will give more predictability.  



So instead of having more than 100 ETF applications and everyone trying to figure out what the SEC is trying to approve…just set out the rules and we [won’t] need to guess.



We think the SEC has everything they need to make their own decision. They don’t necessarily need to change legislation. Some other aspects are more complicated, like broker-dealer rules, the market structure, what is a security and what is not — so there’s a lot of complicated stuff around crypto. But I think clarity on the ETF side is within the SEC’s current mandate.



Blockworks: How do you view the demand for crypto index ETFs versus existing and future single-asset crypto products? Kerbage: We think that crypto is way bigger than just bitcoin. But we think, at least for traditional investors, it’s too risky to try to pick the winners…especially advisers and financial professionals.



They’re looking for a small allocation in their portfolio — like 1% to 5%. If eventually they’re in a situation [where] they need to decide between bitcoin, ether, solana, XRP, litecoin, all these different assets, it’s just too complicated for a 1% position. So that’s why it just makes sense to go diversified and have an index approach. This is what they do in all the different asset classes. When they decide to invest in emerging markets, they don’t go out to Brazil or South Africa trying to pick out specific stocks. They just buy an emerging market index. We think they should be looking at crypto assets the same. 



Blockworks: Hashdex also offers a US ETF that only invests in bitcoin. Are investors still interested in that one now that you have the BTC/ETH option?&nbsp; Kerbage: I would say 90% of the conversations we have are around indexes.&nbsp;



If you want to buy bitcoin, that’s fine, we have a bitcoin product and there [are] a lot of different bitcoin ETFs out there. But when you’re investing only in bitcoin, you’re making a decision to short the crypto market.&nbsp;



The biggest opportunity we see right now is getting exposure to the space with the optionality that crypto is bigger than just bitcoin.



Blockworks: How much more interest do you see from clients in a product like NCIQ when BTC and ETH prices are up, versus when they’re down? Kerbage: Most of the advisers understand that this asset class is here to stay and they need to have a strategy around it. So they’re all looking at the space and studying it.



Of course, as we have positive price action, it helps. Because they have more questions from clients, and as they have more questions from clients, they’re more inclined to take action.



Blockworks: How might the latest vote against the stablecoin-focused <a href="https://blockworks.co/news/waters-crypto-congress-block-hearing-trump">GENIUS Act</a> impact broader crypto regulatory progress and the timeline for more crypto ETF approvals?    



Kerbage: It’s hard to talk about the timeline. In the executive branch, there’s definitely a strong guidance towards giving clarity to the industry and doing this fast.



So you can have some discussion in Congress, with Democrats fighting back, and they might argue [President Donald] Trump getting involved in crypto and building his own crypto business is controversial.



But even with the chairman of the SEC [speaking] publicly about this, this is one of the priorities of his administration…to give clarity to this industry.



This interview was edited for clarity and brevity.



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ETFs

Crypto indexes offer ‘biggest opportunity’ as SEC decision looms: Hashdex CIO

Donovan Choy

This is a segment from the 0xResearch newsletter. To read full editions, <a href="https://blockworks.co/newsletter/0xresearch" target="_blank" rel="noreferrer noopener">subscribe</a>.



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The following is the third and final part of a multi-part series on the state of crypto liquid markets, based on several conversations with liquid funds. You can find part <a href="https://blockworks.co/news/crypto-liquid-funds-bitcoin-target-this-cycle">one</a> and <a href="https://blockworks.co/news/crypto-liquid-funds-fundamentals">two</a> here.



Which crypto sectors are the most reviled by the average person in the industry? Anecdotally, gaming and crypto x AI projects seem to make the easiest punching bags. If I had a dollar for every time I heard “crypto games aren’t fun…”



The liquid funds I spoke to, however, had much more lukewarm and varied feedback. Though some were uninterested in gaming, others expressed optimism.



“The Web3 gaming space is very challenged at the moment and is most overlooked or under-owned,” Spartan co-founder Kelvin Koh told me.&nbsp;



“We need a big hit game for people to pay attention to Web3 gaming again. Off the Grid, Maplestory Universe and FIFA Rivals are three games we are watching closely.”



Off the Grid in particular has continued to average about <a href="https://flipsidecrypto.xyz/yasmin/gunzilla-network-metrics-explorer-kbgQ38">552k</a> daily players after its <a href="https://blockworks.co/news/off-the-grid-blockchain-gaming-experience">big bang launch</a>. Its active player base has cemented the GUNZ chain as a top 10 chain based on active addresses and transaction count, according to <a href="https://x.com/pierskicks/status/1906626745794519419">Delphi Ventures</a>, an investor in the game.



1kx was another fund that <a href="https://x.com/pet3rpan_/status/1887140527310864481">expressed</a> greater optimism for Web3 gaming.



Traditional free-to-play mobile games have an incredibly high entry barrier and require millions to breakeven. But a Web3 game that leverages the power of token incentives can greatly reduce that barrier of user acquisition, 1kx partner Peter Pan told me.



“A game like Pixels raised $4 million in their first year and was able to go to market within 18 months. They spent $70 million in token incentives on user acquisition and made about $25 million back — that’s roughly a 30% return on spend that would never be possible for a Web2 startup managing the same budget.”



Despite the early days of crypto x AI, a few funds also expressed hopefulness for the sector. At the very least, most acknowledged that in the long run, blockchain would enable AI in some specific use cases.



For instance, one crucial way that blockchain tech can support AI is in the area of “identity,” Pantera’s Cosmo Jiang said.



&#8220;Infinite agents and bots will exist thanks to AI. So there will always be a demand to know what is truly human. What better way to create a global, permissionless, censorship-resistant identity solution than using a blockchain? World [formerly known as Worldcoin] is doing something critical here.”



When it came to more mature token sectors within DeFi (DEX, lending liquid staking), there was general agreement among the funds I spoke to that these were markets with proven PMF and ways to perform valuations.



This however also crucially means that token valuations in DeFi were increasingly tethered to financial reality and less susceptible to speculative valuations than, say, memecoins, as one investor told me.



This is in stark contrast to L1/L2 tokens, which saw more disagreement on how they should be valued.



The valuations of most existing L1 tokens (on a P/E ratio basis) were far beyond what a fundamental analysis would explain, and poised for a harsh correction to the downside, one investor told me.



Another believed that L1 tokens were still erroneously being valued as a comps to bitcoin, which has become more of a store of value.



Here’s what Blockworks head of research Ryan Connor had to say on L1 valuations:



“The reason, all else equal, for the higher valuations for L1 and L1-like things is because they are platforms, and platforms can be money-making machines. So all else equal, theoretically, you&#8217;re pricing in higher growth. Solana, for example, can 5x its revenue in the next 12 months to above 10b. That&#8217;s incredible earning power. You can&#8217;t say the same for AAVE.”



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Liquid funds remain optimistic about Web3 gaming and blockchain uses for AI

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



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Bitcoin has its enemies.



Environmental alarmists, stubborn central bankers and out-of-touch politicians would surely count, even if their ranks have thinned in the past few years.&nbsp;



There’s also the odd boomer economist who would still jump at the chance to suggest that bitcoin has no intrinsic value and embodies the greater fool theory, if it meant extra engagement.



All those archetypes are great heels that routinely serve as sounding boards for Bitcoin discourse.&nbsp;



There are also those who’ve attacked Bitcoin out of boredom, curiosity or just for fun. Which I suppose is somewhat cooler.



This is the tale of one such punk hellbent on disrupting Bitcoin as best they could.



<h2 class="wp-block-heading">On This Day — Bitcoin gets Stoned</h2>



This story starts all the way back in 1987, more than two decades before Bitcoin.



It’s believed that an unknown student at the University of Wellington in New Zealand had developed malware known as Stoned, one of the first ever computer viruses.



Stoned was an early boot virus, a category which infects the boot sector of a hard drive or removable media (mostly floppy disks back then), altering how computers initially load their operating systems and run other necessary start-up functions.



It was <a href="https://www.computerarcheology.com/Virus/Stoned/">technically</a> a novel virus, but in reality, Stoned was more of an elaborate prank.&nbsp;



An infected machine would have a one in eight chance of loading a screen that would simply display a pro-pot message:&nbsp;



“Your PC is now stoned! LEGALIZE MARIJUANA!”



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfgDBc_6qcRlLNpcqzSBOt47t-3WutWG_iX-KXJA-F_G8uNCvgZI3QOw2oBn69IlWLf932_iwjpMS-Hqw5xoVcMqR9-rktlCAwWsWBV4XRFKDgL4fUP_686qE0Z39hqnL1VRDNfOQ?key=cjdYwqDPndWtenbHiMRJ1A" alt=""/><figcaption class="wp-element-caption">Check the bottom right corner — you’ve been Stoned!</figcaption></figure>



Twenty-seven years later, on May 15, 2014, a pseudonymous Windows 7 user <a href="https://web.archive.org/web/20170219103210/https://answers.microsoft.com/en-us/protect/forum/mse-protect_updating/microsoft-security-essentials-reporting-false/0240ed8e-5a27-4843-a939-0279c8110e1c?tm=1400189799602&amp;auth=1">reported</a> a worrying false positive from their Microsoft Security Essentials package.



Microsoft&#8217;s built-in antivirus software had detected Stoned’s virus signature in Bitcoin’s blockchain data, leading to constant annoying popups and even deletion of all relevant files.



That included removal of the complete copy of the chain’s history required to sync nodes, which was almost 19 GB large at the time, data that would be automatically re-downloaded by the Bitcoin client.



It didn’t make any sense for Stoned to have really infected Bitcoin Core. The virus’s code would be completely benign, even if it were somehow written to the chain in its entirety.&nbsp;



The running theory was that perhaps by some statistical anomaly, Bitcoin’s hash function for its block headers had somehow generated enough of Stone’s hexadecimal byte sequences for Microsoft’s malware scanner to recognise it as the actual virus.



Microsoft then quickly patched Security Essentials to ignore the curiosity.



The smoking gun only came about six weeks later, by way of IT professional Didier Stevens. It was not a hoax: Someone had intentionally attempted to bring down Bitcoin nodes.



Stevens had <a href="https://blog.didierstevens.com/2014/06/30/update-stoned-bitcoin/">discovered</a> a series of transactions from April 4, 2014 featuring outputs containing identical byte sequences to ones inside Stoned’s code.



<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">Bitcoin &amp; Stoned Computer Virus: I found the smoking gun! <a href="http://t.co/PIGqktn8Gf">http://t.co/PIGqktn8Gf</a>&mdash; Didier Stevens (@DidierStevens) <a href="https://twitter.com/DidierStevens/status/481174370317242368?ref_src=twsrc%5Etfw">June 23, 2014</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Meanwhile, two days earlier, a <a href="https://pastebin.com/ct2WHUK5">Pastebin</a> post by an anonymous author had outlined a method of spamming the Bitcoin specifically to trigger false-positives from antivirus software.



They wrote: “Spamming the bitcoin database with virus signatures will cause havoc. Some antivirus-programs will delete the database locally, others will deny their bitcoin-client access to the databases.”



“Some won&#8217;t be able to start their bitcoin-clients again (and can&#8217;t understand why). Some will format and reinstall their computer&#8230;to once again get ‘infected&#8217; when they get a bitcoin client again.”



Next, panic would strike “computer n00bs” alongside rumors that Bitcoin is spreading viruses. Then, chaos, with the media dramatizing the situation.&nbsp;



“The value of bitcoins will drop hasty…Please help spamming the bitcoin database with virus signatures :)”



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXd82-YC2LPCPeVRyuVgboN-lyyXnOEKoW_QMPdb_sIvramcSRzS4jmd-qiBtjrEzhCVO74WEndA0A0WsuX7r7grnTOMt90UG8vhB7xKLoz_JmA4feSAgST07Wrv3ZclkUw_X5QsKw?key=cjdYwqDPndWtenbHiMRJ1A" alt=""/></figure>



Stoned bytecode was injected into Bitcoin’s chain data within about a day of the post.



Of course, there was no widespread panic. The price of bitcoin never crashed in relation to the prank, and there wasn’t a noticeable drop in hash rate due nodes being knocked offline.



But there were forum threads about it, as well as <a href="https://www.theregister.com/2014/05/18/bitcoin_user_stoned_on_virus_warnings/">media headlines</a>, blogs and other posts, including this one, 11 years later. That’s gotta count for something.



— David



<h2 class="wp-block-heading">From The Pod</h2>



These days, Bitcoin is increasingly divided over whether spam, not unlike the Stoned bytecode, is, in fact, a virus.



“We’ve always been hostile to the shitcoiners when they invade. Make no mistake, they are invading right now and we should be hostile to them again.”



Those are the passionate words of Chris Guida, a Bitcoin ecosystem developer in favor of stopping non-standard data from ever making it to the chain via the ever-polarizing OP_RETURN field. 



<iframe loading="lazy" width="560" height="315" src="https://www.youtube.com/embed/4CdPv-herxA?si=-t3mW8HYwyn0x7rM" title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen></iframe>







In today’s epic two-hour episode of Supply Shock, Guida and host Pete Rizzo cover the spam filter debate, miner incentives, the realities of decentralization in modern day Bitcoin and other spicy topics.



“It’s called a filter and not a wall because some things are going to slip through. That’s okay, the point of spam filters is to raise the cost of spamming so that the worst offenders, things like BRC20s that had huge transaction volume at the peak, can&#8217;t happen.” Check out the full episode on <a href="https://www.youtube.com/watch?v=4CdPv-herxA">YouTube</a>, <a href="https://podcasts.apple.com/us/podcast/bitcoins-last-stand-the-op-return-invasion-chris-guida/id1558223079?i=1000708560827">Apple Podcasts</a> and <a href="https://open.spotify.com/show/2yFL2nSsQucf1rzdEKbFZY">Spotify</a>.



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



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



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



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



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



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
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Bitcoin gets Stoned: How one anonymous prankster tried to crash BTC

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



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We touched on the lending sector a few weeks ago, but I want to plug back in.&nbsp;



I caught up with Ledn’s Mauricio Di Bartolomeo, who told me that last quarter, Ledn did $304 million worth of bitcoin-backed loan originations.&nbsp;



“That&#8217;s three times the originations we did at the peak of the market in 2021,” he added. And “multiples” of what Ledn saw in 2024.&nbsp;



“The demand for borrowing dollars and keeping the bitcoin is growing [at the fastest pace since]&nbsp; it&#8217;s ever grown since we started this business in 2018,” Di Bartolomeo said.&nbsp;



Di Bartolomeo told me that the bulk of their customer base is retail, though they do have some institutional clients.&nbsp;



Demand has increasingly grown amongst individuals who’re sitting on millions of bitcoin — enough to retire — but still want to utilize that bitcoin to have access to the traditional banking system for things like mortgages.&nbsp;



This cycle, Di Bartolomeo says, the bad seeds have been weeded out — and people like former Celsius CEO Alex Mashinsky are now <a href="https://www.cnbc.com/2025/05/08/celsius-ceo-alex-mashinsky-sentenced-to-12-years-in-crypto-fraud-case.html">serving time</a> for the crimes committed last cycle. However, he cautioned that folks should still be careful when it comes to lenders.&nbsp;



“I would say it&#8217;s the demand is exploding,” he said, but urged caution and diligence for folks looking to access lending markets. It’s not worth a sweetheart rate if the company doesn’t pass a vibe test.



Zooming out, <a href="https://blockworks.co/tag/ledn">Ledn</a> isn’t the only one to see success so far this cycle. In a different sphere of the lending sector, <a href="https://blockworks.co/tag/maple-finance">Maple Finance</a> is also seeing success with its institutional lending.&nbsp;



A Blockworks Research note this week said that “SYRUP offers an asymmetrical investment case in lending, driven by compelling valuation metrics relative to peers, solid growth avenues via the successful Syrup pools and the strategic istBTC initiative, a resilient team, and a completed vesting schedule removing early supply overhang.”



Maple and Ledn have very different target audiences, so I’m cautious to avoid any sort of comparisons, but I think they each offer a unique vantage point into the overall health of the lending sector.&nbsp;



The institutional lending bull case Blockworks Research sees as $250 million in loans outstanding by the fourth quarter, while the base case is $200 million by the same time period.&nbsp;



I <a href="https://blockworks.co/news/nexos-move-back-us-crypto-lending">wrote a few weeks ago</a> that we’re starting to see a resurgence in the custodial lending market, and that certainly is playing out when looking at the numbers so far. It’s also interesting to gauge how different players in the space are faring — or finding success.&nbsp;



Not to mention that nowadays there are more options in the lending market than in previous cycles. Take, for example, noncustodial choices for bitcoin-backed loans with a DeFi tilt, which include <a href="https://blockworks.co/price/tbtc">tBTC</a>, <a href="https://blockworks.co/news/building-better-wrapped-bitcoin-for-defi">iBTC</a>, <a href="https://blockworks.co/news/transparency-of-btc-derivatives">LBTC</a>.&nbsp;



The key, for me anyway, is to ensure that there aren’t historical repeats. If this market is going to be successful, it’s going to need to stay away from the shams of the past.



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



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



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



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



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



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

Empire Newsletter

Ledn’s demand is ‘exploding’: Executive

This is a segment from The Drop newsletter. To read full editions, <a href="https://blockworks.co/newsletter/thedrop">subscribe</a>.



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Crypto artist Emily Yang, known online as pplpleasr, hasn’t given up on her plans to make blockchain-powered filmmaking happen.&nbsp;



Her streaming and crowdfunding startup <a href="https://www.shibuya.film/">Shibuya</a> — which raised $6.9 million back in 2022 and counts a16z and Variant Fund among its investors — launched this week.&nbsp;



Shibuya is hosting five pilots as part of its “Season One” and will ultimately let viewers decide if they want to further fund those projects with fiat currency donations that go entirely to the filmmakers (and supporters get refunds if the target amounts aren’t reached).



While Shibuya’s site doesn’t mention crypto, it’s in the process of adding blockchain rails and features, a spokesperson told me in an email. Coinbase’s Base chain <a href="https://x.com/sarahzorah/status/1922663078849593383">sponsored</a> the Season One launch event.



“We built Shibuya to disrupt the traditional studio system and put power back into the hands of creators and fans,” Yang said. “With the launch of Season One, we’re spotlighting bold, original work and inviting fans to decide what comes next.”



Back in 2022, Shibuya released an animated short, White Rabbit, as a proof-of-concept for the platform. It raised $1.2 million in less than 30 minutes. Yang also <a href="https://decrypt.co/99238/pplpleasr-releases-producer-pass-ethereum-nfts-for-cannes">sold</a> “Producer Pass” NFTs for Cannes that year, with NFTs costing anywhere from $14,000 to $19,600 worth of ETH each.



The question: Are successes like that still possible three years later, now that the NFT bubble of that era has popped and Hollywood struggles forward, with filming in Los Angeles at <a href="https://www.theguardian.com/film/2025/apr/26/los-angeles-film-and-tv-production">historic lows</a>?



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXd8GAvqFxtFVFA5cKhjv0RXkTUPCkGW3gnxIVW3mCZtipT6-x57oprteJBMOdvU3m6IzDgkeIIszAsf-nSYc9ZgpUeeoZRwhtlMkKhgjuEw-1dhusgcNc5QQr0iOqAx7CEhBh60fA?key=con7Iftzl8cCfXaM1wn3eQ" alt=""/><figcaption class="wp-element-caption">Artwork for Shibuya’s five platformed projects</figcaption></figure>



Some of Shibuya’s shorts up for funding are animated, while others are live action, with runtimes ranging from six to about 27 minutes per episode.



Ultrasound, from director Julian Lamadrid, is about a punk rock band in NYC. Every episode will be one shot (in Hollywood, that’s called a “oner”). Oners have been trending recently (like Adolescence on Netflix), and the choice makes sense here, too.&nbsp;



Diaboli, a creepy medieval animated series about demons, religion and family, is about seven minutes long and has a video game-like feel with its dramatic, dark aesthetic and great voice acting. This one is like an episode from Netflix’s Love, Death and Robots, and is also a good watch for Castlevania fans.



Don’t Forget About Me from Elle Mills is a story about teenage siblings who meet their favorite childhood character from TV, while The Funny Thing About Losing Socks from Ben Christensen is about traveling to another dimension to retrieve socks lost in the dryer — but there’s a twist.



Last but not least, Spiritual 100 from director Jordan Cooper is a “satirical anime mini series” with humorous charm. In it, a broke guy joins a TV competition where a total of 100 people compete on a reality show that’ll determine who is the most spiritual.&nbsp;&nbsp;



It’s a great mix of talent — we’ll have to circle back to see which ones get funded.



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



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



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



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



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
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Pplpleasr’s streaming platform is back with 5 short films

This is a segment from The Breakdown newsletter. To read full editions, <a href="https://blockworks.co/brand/the-breakdown">subscribe</a>.



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<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">
“Sometimes the best investments are precisely the ones you cannot explain and probably make no sense.”  — Richard Toh
</blockquote>



When I started writing this newsletter nearly four years ago, I kept the subject matter high-level — mostly because I didn’t understand the low level.



That’s not what I expected it to be.



Instead, I expected it to be like the morning notes I sometimes wrote for clients in my previous job as an equities trader — notes that were mostly just a rundown of news taken from a Bloomberg terminal that the clients also had but were too lazy to look at (people used to get paid for doing some surprisingly basic things in TradFi).



I figured that’s what this newsletter would be, too, because what else is there to talk about every day other than that day’s news?



But when I sat down to write the first newsletter, I quickly realized I had no idea what counted as “news” in crypto.&nbsp;



At that point, I had only really heard of Bitcoin, Ethereum and a few others — and I had never once heard the term “DeFi.”



I might have pretended to know a little more than that when I applied for the job but I didn’t need to know a lot more because Blockworks was looking for someone who knew TradFi better than DeFi.



So the newsletter became, more or less, me taking readers along as I learned about crypto.



I started with high-level questions like, what makes a security a security? What makes money, money? What makes protocols different from companies? What makes tokens different from stocks?&nbsp;



These were the kinds of things I could research in the evening and write about the next day, no matter what the news happened to be.



And that’s what I still do now because the high-level stuff turned out to be what’s most interesting to me — crypto is an attempt to reinvent finance and that makes writing about crypto an opportunity to relearn it from first principles.



But I also had to learn what is and isn’t news in crypto, and one of my first go-to sources for that was <a href="https://www.youtube.com/@TheBreakdownBW">The Breakdown</a> with NLW.



His podcast (already popular enough that NLW could go just by his initials) curated the day’s crypto stories, interpreted them for me, and put them into the macro context that I was more familiar with — all in an efficient 15 minutes or so that fit neatly within my limited span of attention.



I learned a lot.



So, about a year into listening, when NLW unexpectedly read <a href="https://nlwcrypto.libsyn.com/bitcoin-prehistory-and-a-warren-buffett-ai-bot">two of my newsletters</a> for one of his Sunday podcasts, I felt like I had arrived.&nbsp;



If NLW thought my writing was worth sharing with his audience, maybe, I thought, I could stop feeling like I was faking it.



(Full disclosure: I still kind of feel like I’m faking it.)



For that reason, it’s very fun for me to share that this newsletter is being rebranded as <a href="https://blockworks.co/brand/the-breakdown">The Breakdown</a> and paired with NLW’s podcast as one of Blockworks’ expanding roster of media brands. 



Nothing much will change content-wise — I’ll still be taking you along for the ride as I try to make sense of crypto, markets and investing. 



But you can expect some thoughtful updates to both the podcast and the newsletter that reflect our shared mission to figure out the future of finance.



Should be fun.



<h2 class="wp-block-heading">Crypto pilled?</h2>



I&#8217;ve learned more about finance in my four years writing about crypto than I did in my 25 years working in finance.



When I was an equities trader and an analyst pitched me a stock idea, my first question wasn’t &#8220;Is this stock a security?” Nor was it my last question — before crypto forced me to think about what makes something a security, I had never even heard of the Howey test.



Now I can recite all four prongs of Howey from memory.



(Yes, I’m available to liven up your next dinner party conversation, thanks for asking!)&nbsp;



Nor had I given much thought to what makes something money before bitcoin forced me to think about that, too.



It’s pretty intuitive: Money is whatever you use to pay for things (just being a store of value doesn’t qualify, sorry).



But how money is created turns out to be a deep mystery.



When the economist <a href="https://www.sciencedirect.com/science/article/pii/S1057521914001070">Richard Werner</a> went to a one-branch bank where he could personally observe every step of the loan process in hopes of proving that banks create money “out of thin air,” he failed to identify the exact moment of creation.



Money, it turns out, is emergent, like consciousness.



I stumbled upon a similar mystery when trying to determine whether token holders own the protocols they believe they’re invested in.&nbsp;



I’m still unsure on that one: Protocols are just software, so maybe they can’t be “owned” in the traditional sense — but if token holders can vote to change the software, maybe they can.



More intriguingly, though, asking that question has made me unsure whether shareholders own the companies they’re invested in.



Shareholders think of themselves as owners, of course, but the corporate law scholar <a href="https://www.amazon.com/Shareholder-Value-Myth-Shareholders-Corporations-ebook/dp/B007PIZ8IO/ref=sr_1_1?crid=3QDPGQ1YLNWJI&amp;dib=eyJ2IjoiMSJ9.T6bT88qClDz57NOO66PSxexg6auowSCPKTwgedcHDw-eyhYO9Aj3Ogey2ZwKpGhs936XmuML4k8mC3bWVaXna_XshQWMXswxAdXjxFyLA-C_hLdLq7GtadlfNNsf-GjkrtNerqrE89XmgKFRbIMm1aJs1l0An4mhBLoZkO__prPef-DQk9zmGSG1Rb52T9lSx82aIuGLtZtdn5CsB7A0bhQUf_GDlUXhx-jjbqyZ6y8.sYQcr2BmQIXaX_cmYlCvjhZ_Wv-nNgjBQinPAlCmuqc&amp;dib_tag=se&amp;keywords=lynn+stout&amp;qid=1747237929&amp;sprefix=lynn+stout%2Caps%2C171&amp;sr=8-1">Lynn Stout</a> says they’re not (she convincingly argues that corporations own themselves).



Traditional investors may dismiss these questions as academic — the system works just fine for them, whatever its philosophical underpinnings.



But crypto might soon force them to start philosophizing.



Last week, Hester Peirce <a href="https://www.sec.gov/newsroom/speeches-statements/peirce-iismgd-050825">said</a> the SEC is considering an exemption that would allow securities to trade on blockchains; and this week her colleague, Mark Uyeda, <a href="https://www.sec.gov/newsroom/speeches-statements/uyeda-remarks-crypto-roundtable-tokenization-051225?utm_medium=email&amp;utm_source=govdelivery">said</a> that tokenization has “the potential to dramatically change how financial markets operate.”



If so, it might dramatically change how people think about financial markets, too.



It’s already happening, to some degree.



Matt Levine, for example, attributes the phenomenon of memestocks to the emergence of bitcoin, which “broke everyone’s brains” about why assets might have value.



More recently, The Economist’s <a href="https://x.com/Birdyword">Mike Bird</a> speculated that retail investors may have been such enthusiastic buyers of the crash in equities because they’ve been influenced by the HODL culture of crypto.



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<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/thebreakdown">The Breakdown</a>: Decoding crypto and the markets. Daily.</li>



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



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



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



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



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



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

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