Tidal Finance

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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RTFKT, Nike’s abandoned digital brand pronounced “artifact,” lost its CloneX art overnight.



The art for all 19,500 Ethereum NFTs in the <a href="https://opensea.io/collection/clonex">collection</a> was replaced with a black background with white text that reads: “This content has been restricted. Using Cloudflare&#8217;s basic service in this manner is a violation of the Terms of Service. Please visit cfl.re/tos for more.”



That URL redirects to a Cloudflare terms page that states that a more basic Cloudflare plan does not allow clients to stream videos. “We limited your ability to use our services to deliver video bits from our network to your visitors. This is because every second of a typical video requires as much bandwidth as loading a full web page,” the <a href="https://developers.cloudflare.com/fundamentals/reference/policies-compliances/delivering-videos-with-cloudflare/">page</a> reads.



“Unfortunately, while most people respect these limitations and understand they exist to ensure high quality of service for all Cloudflare customers, some users attempt to misconfigure our service to stream video in violation of our Terms of Service,” the post continues.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXdfvd2JkMDLC6hbrKHNdJJRmnXEWQFlI5FM6F_Cq4BMek12obe0vtvZXCfI-TePWufGyR_r9S8zSVguX-5GWg8119F9ClOHnN0Uc2dGhi38BAlTnAZ31l15oKQa_ZDp8kNt4VZVug?key=QkJpWubnKckpolBGsq0DbuvZ" alt=""/></figure>



The issue, then, appears to be due to the fact that the CloneX NFT data was not being hosted on an adequate Cloudflare plan. Others, like Yuga Labs blockchain lead 0xQuit, speculated that RTFKT may have <a href="https://x.com/0xQuit/status/1915413726091747477">forgotten</a> to pay their Cloudflare bill and saw their service cancelled (RTFKT lead Samuel Cardillo <a href="https://x.com/cardillosamuel/status/1915439803442548782?s=46">told</a> me it has “nothing to do” with an unpaid bill)..&nbsp;



Other RTFKT collections — like its NFTs with artist Fewocious, its Animus Eggs, and its Nike Dunk Cryptokicks — still had visible video art live as of Thursday at 10:30am ET white the CloneX art was gone.



The CloneX shakeup appears to have happened overnight, when several X users noticed the issue and flagged it on social media.



“And some of you thought this was the next @cryptopunksnfts since it was abandoned,” Ape Ventures founder Xeer <a href="https://x.com/Xeer/status/1915338336991842742">wrote</a> early Thursday morning. Unlike most NFT collections, CryptoPunks art is <a href="https://www.larvalabs.com/blog/2021-8-18-18-0/on-chain-cryptopunks">stored</a> fully onchain on Ethereum.



Because NFTs can use art or visual data that’s hosted by a centralized company — like Cloudflare or AWS — they are inherently more mutable and censorable than decentralized data storage options. The tokens will still exist — but the art associated with it can vanish or be altered.



By 11:15 am ET on Thursday, however, some of the CloneX NFT art had reappeared, suggesting the issue with Cloudflare had been resolved (By 12:30pm ET, the art had reappeared).&nbsp;



So what happened? RTFKT Head of Tech Samuel Cardillo <a href="https://x.com/CardilloSamuel/status/1915371853075669391">said</a> the CloneX and Animus NFTs are moving to decentralized blockchain storage platform Arweave. Cardillo added that their Cloudflare plan will end at the end of April. The team had been trying to switch their storage infrastructure since December, but the switch took longer “because of internal corpo [sic] process.”



“Somehow this morning Cloudflare decided to move to the Free plan [a] few days before the end of the contract which also triggered that bug in which Cloudflare refuses to stream images and videos,” Cardillo said.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXeUFQXAP2Lz1SdZAlIiUcMVroVnqMwOshzIhT1GGzicD4yWvJNJgDLCd3IF6lhXJx8bg3J7537Oz33wR7rh_fFmg_GCPXYBn6o_mNH0ffTFwjctx0eQGuVKUQ-yYwPelNw-9jdpQQ?key=QkJpWubnKckpolBGsq0DbuvZ" alt=""/></figure>



RTFKT shut down operations in December, spurring a slew of over 3,300 CloneX sales in one day as traders gave up hope on the future of the collection.



RTFKT’s post about its shutdown at the time didn’t offer much of an explanation. It instead claimed the shutdown was “a new chapter” for the company.



“RTFKT isn’t ending. It’s becoming what it was always meant to be — an artifact of cultural revolution,” the <a href="https://x.com/RTFKT/status/1863621178532773928">post</a> read.



It’s a bitter end for those who lost money on the NFTs as well as those who had longer-term hopes for the December 2021 collection. The CloneX floor price hit an all-time low earlier this month, with NFTs selling for roughly $230 worth of ETH, per NFTPriceFloor <a href="https://nftpricefloor.com/clonex">data</a>.&nbsp;



In April 2022, RTFKT CloneX NFTs had a floor price of over $60,000 per NFT. Rarer CloneX NFTs have <a href="https://www.cryptoslam.io/clonex?tab=top_sales&amp;period=all">sold</a> for prices as high as $1.25 million.&nbsp;



Blockworks has reached out to Cloudflare for comment.



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NFTs

Cloudflare removes RTFKT CloneX NFT art due to Terms of Service violation

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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Here’s a common paradox L1s face today:



L1s want to enable application-specific L2 chains because every app cannot coexist in the same blockchain environment. Builders want freedom to customize.&nbsp;



But when every appchain is making their own independent design decisions, you have fragmentation. Then they leave your L1.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXech4uaHAx8OtvKBlnAzaGwRJ-fjfmV5Xi6KHoVvLQjDiQvy8LQ-JMATLJkuXDJDMVqK0pKoaeq5auAtyBfcDdIc7reSYqbx0eM2nM-loK6dukzbQefWbRKYMUNSTGSQjpeji4mSQ?key=4XOombGfm_T4NYi0pZbB_87M" alt=""/></figure>



Ethereum, Cosmos, Avalanche and Polkadot have all suffered from similar problems.



<h2 class="wp-block-heading">Initia’s architecture</h2>



Initia, which is launching its mainnet today, is determined to run back the same appchain vision while avoiding the pitfalls of fragmentation.



Appchains that choose to build on Initia benefit from a tightly integrated and opinionated tech stack — what Initia calls the “Interwoven Stack.”



All Initia appchains are built with the same stack and standards. They share a canonical bridge (LayerZero), cross-chain messaging (Cosmos IBC), underlying framework (Cosmos SDK) and standardized gas token (native USDC via Noble is the default though chains can change it) across chains, as well as and data availability layer (Celestia).



Appchains can run on whichever execution environment they prefer. Of the 18 announced teams building on the Interwoven Stack, they are generally evenly split between the EVM, MoveVM and WasmVM, Initia’s co-founder Zon told me.



They can also leverage common MEV infrastructure like POB (Protocol Owned Builder) and Protorev to capture non-toxic MEV, use a common enshrined oracle (Connect), a common multisig (Initia Multisig), block explorer (Initiascan) and domain name service (Initia Username).



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXcfr_Xg0J9kkNQcVzu074fEgv67OGnlSXme1CDAB4Mi2fn1CAy4h9IdV-RlJjgkBk51zPTFS_-856PfsyzWx7_03sSJ3Piy4DtMx80UXKBPga3HZgdJtZn4xx_bYeC5jZOPJG9W?key=4XOombGfm_T4NYi0pZbB_87M" alt=""/></figure>



You get the idea — it’s every essential public good possible to allow an ecosystem of differently-minded builders to run on common standards without suffering fragmentation.



OK, well what about the L1?&nbsp;



The Initia L1 runs on the MoveVM and CometBFT consensus with single slot finality and a 500 ms blocktime.&nbsp;



The L1 is meant to act as a liquidity hub, very much like what Cosmos Hub aspired to be.&nbsp;



What keeps liquidity on the L1? INIT token holders can stake INIT on the L1 to earn inflationary staking rewards, as well as trading fees on Minitswap, the L1’s native DEX.&nbsp;



There is no fee charged to pass through the hub right now, though that may be integrated down the road, the Initia team said.



This is referred to as “<a href="https://docs.initia.xyz/home/core-concepts/enshrined-liquidity/introduction">enshrined liquidity</a>,” which effectively enables INIT tokenholders to benefit from both staking rewards as well as act as a liquidity provider — a restaking of sorts.



What would deter successful Initia appchains from <a href="https://x.com/0xljki/status/1749812293565809099">leaving</a> Initia to create their own chains?



For one, appchains already have full customization over their environment and are able to internalize their own MEV.



Secondly, Initia appchains are not the same as general-purpose L2 rollup chains, so their native tokens will likely exist on the L1 where the most liquidity is.&nbsp;



“They&#8217;re not going to launch a DEX on their chain because that&#8217;s not what their appchain is for,” Initia co-founder Stan said.



Finally, Initia explicitly rewards appchains with INIT rewards based on TVL and governance metrics as part of its <a href="https://docs.initia.xyz/home/core-concepts/vip/introduction">Vested Interest Program</a> (VIP). Users earn INIT based on criteria set by L2s.



The VIP program is what Initia hopes will stave off the lack of value accrual that ATOM suffered from.



“The greatest downfall for ATOM was the fact that Cosmos users did not care for the token itself. Cosmos appchains did not have a strong reason to integrate ATOM.”



To be fair, these aren’t particularly original mechanics. Initia’s VIP rewards have striking similarities to Berachain’s “proof-of-liquidity” or Blast’s “Gold” campaign. MEV capture is being pursued by many other ecosystems/apps. Arbitrum <a href="https://blog.arbitrum.io/custom-gas-tokens-for-all-arbitrum-chains/">announced</a> custom gas tokens today.&nbsp;



What is perhaps original is the holistic combination of all of these design choices from day one to avoid the many problems of value accrual that have plagued ATOM or ETH.



<h2 class="wp-block-heading">Initia launch</h2>



Initia has raised $25m in total through three private rounds and a $2.5m Echo round in September 2024.



According to Initia’s press release, there are at least 18 teams that are building on its Interwoven Stack. These teams have collectively raised $28m, notably more than Initia&#8217;s own raise. I noticed a similar pattern with <a href="https://blockworks.co/news/megaeth-l2-blockchain-fast-speed">MegaETH</a>. Is the fat protocol thesis dead?



Anyway, INIT goes live today. Here are its <a href="https://x.com/initiaFDN/status/1914309728093831407">tokenomics</a>.



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0xResearch Newsletter

Running back the appchain vision: Initia mainnet launches today

David Canellis

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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Eleven years ago this week, one of the first great Bitcoin documentaries, The Rise and Rise of Bitcoin, premiered at the Tribeca Film Festival.



The film is rare in that it was made by someone with real skin in the game.



It centers around Daniel Mross, a Pittsburgh-native computer programmer who began mining bitcoin in 2011 and went on to found Bitcoin-focused investment fund Maximalist Capital.



Filmed by brother Nicholas between 2013 and 2014, when bitcoin was headed to $100 for the first time, Dan travels the world to meet major figures in the space, as yet only four years into its lifespan.



They meet <a href="https://x.com/pete_rizzo_/status/1875542871270449274">Charlie Shrem</a>, then-CEO of bitcoin exchange service BitInstant as it worked through sudden supply issues resulting from Mt Gox downtime; <a href="https://x.com/pete_rizzo_/status/1808833197397958969">Eric Voorhees</a>, when BitDice was still a big deal; and Mark Karpeles, who gave a secretive tour of Mt Gox’s office in Japan only months before it went down for good.



Brian Armstrong and Fred Ehrsam also make cameos. Coinbase was timely: The global Bitcoin economy was actively reckoning with the growing need for more crypto exchanges in light of the Mt Gox debacle.



<iframe loading="lazy" width="560" height="315" src="https://www.youtube.com/embed/A06qdTpOYcg?si=SF79EOofDflvZ8Z-" 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>







The Rise and Rise of Bitcoin has a 7.1 rating on IMDb



The Mross brothers even visit Gavin Andresen — still lead maintainer at the time — at his Massachusetts home. “Do your neighbors know that you’re at the center of one of the most disruptive technologies?” Daniel asked.&nbsp;



“I think they know that I do this wacky Bitcoin project… I don’t think they know quite how big it is yet,” Andresen replied.



One electric scene shows Roger Ver — before the Block Size Wars, when he was Bitcoin Jesus — explain the benefits of Bitcoin (and BitPay, in which he was an early investor) to a Korean grocery store owner in the Bay Area.



Bitcoin and BitPay’s low fees compared to credit cards were a major selling point. “I guarantee over the next couple weeks you’ll have lots of computer nerds that love bitcoins, [who] will be coming in here specifically to shop at your supermarket so that they can pay with Bitcoin,” Ver said.



The store owner had the perfect follow-up: “And there’s no central office that they could raid or anything like that?&#8230;So who’s the owner of bitcoins: everybody that owns bitcoins?”



Ver replied: “Yeah! Just like, ‘Who’s the owner of gold: whoever owns some gold.’ Short of shutting down the entire internet and the entire world, there’s no way to stop Bitcoin.”



When we speak of Bitcoin nostalgia, this type of scene comes to mind. What we all would do to return to a time when simply explaining the fundamentals of Bitcoin as it is in the moment, and not what it could be sometime in the future, brought real wonder into people’s lives.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfLiYx1lSprSWMDssGbQHWuNS0nUmpkXqdICR_gRUFJIBCY10X_ndV7nNcV_rbOPJBEN4Io0wlcgTk2vsPdhNfxhGiCZ7pkqToSFwycWliRMjM-NLmJSyJcG1QNCfv94qOdc6BszQ?key=IVx1y8CKchDT7rDFWSNfOpRh" alt=""/></figure>



Bitcoin’s magic affected all sorts of people. “Mr Bitcoin,” a drug dealer who did business via Silk Road out of an internet cafe in Los Angeles, told the filmmakers:



“I think of it as a global thing when I’m on the computer — I’m doing business with the world. When I first heard about it, I was laughing about it. It took me a week to just even think about this for real…I mean, I&#8217;m not gonna lie — I get booty off this. I kind of like talking about this stuff with girls, like girls be like, ‘That shit is hot,’ and like, ‘You&#8217;re not on your street, and you got a little nerd knowledge; this is great.’”



But if nostalgia is really about severe homesickness, as Krauss suggests, then what is “home” in the Bitcoin context?



Watching The Rise and Rise of Bitcoin, the answer is clear: our homes, literally.



The film starts with Daniel showing off his home mining setup — a handful of GPUs sprawled across a basic table in his basement.&nbsp;



Then, as the film progresses and the mining difficulty rises alongside bitcoin’s price, he upgrades to some of the first ever ASIC rigs, still in his basement.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXdl6t1YHPEZsh_SL0JkQD68Xovm0f5NqlL6BWZ7LkEVRuS8ES0HBbnTFy3QPAtgCtbWuuNRAUA-iCBTVVtZpJGDjH2qVyx938RfwwlvrLCI_vDvQ5w6J9FlzdfVtQqv3KHZtWdm3w?key=IVx1y8CKchDT7rDFWSNfOpRh" alt=""/></figure>



By the end, though, Daniel is forced to give up mining altogether, having been actively priced out during filming. “When I started, Bitcoin mining was a hobby for geeks, now it’s a big business. In order to continue mining and continue playing the game and be competitive and profitable, I would have to spend hundreds of thousands of dollars on gear.”



“The 18 miners I ordered from Avalon never arrived and the units from Butterfly Labs took over a year to ship. By the time I got them, Bitcoin mining was so competitive that I would never be able to mine back all the coins I used to buy them. As my new units are arriving, I’m selling them for bitcoins to try to recoup what I can.”



Obviously, there’s no putting the genie back in the bottle when it comes to bitcoin mining. The odds are stacked even further against home miners these days, and it’s questionable whether bitcoin’s initial low-fee feature was ever going to be sustainable with widespread adoption.



But if you’re nostalgic about Bitcoin from the early-mid 2010s, I’d offer two potential cures: go and use bitcoin as money — not an investment — and start tinkering around with open-source mining rigs.&nbsp; Aside from bringing Bitcoin back home, literally and figuratively, I hear they <a href="https://blockworks.co/news/solo-bitcoin-miner-solves-block">can be incredibly lucky</a>.



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Bitcoin

Two cures to treat Bitcoin nostalgia for the 2010s

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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ICYMI: Arch Labs announced a $13 million raise with the goal of launching a bitcoin virtual machine.&nbsp;



The Series A round was led by Pantera Capital.



<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">We’re excited to share that <a href="https://twitter.com/PanteraCapital?ref_src=twsrc%5Etfw">@PanteraCapital</a> is leading our $13M Series A to help <a href="https://twitter.com/Arch?ref_src=twsrc%5Etfw">@Arch</a> build the permissionless financial rails for a Bitcoin-denominated world. This funding brings us closer to unlocking Solana-like speed for Bitcoin apps, tapping into the $1T+ Bitcoin economy. <a href="https://t.co/hI8S62VyiH">pic.twitter.com/hI8S62VyiH</a>&mdash; Arch Network (@ArchNtwrk) <a href="https://twitter.com/ArchNtwrk/status/1914671769861947832?ref_src=twsrc%5Etfw">April 22, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



“We’re at a pivotal moment—both for Arch and for Bitcoin. Bitcoin has seen massive growth and institutional acceptance, but the mempool tells a different story: Not enough on-chain activity is driving sustained fees for miners,” CEO Matt Mudano told me. “This raise allows us to scale engineering, grow our community and support a new wave of builders. Our focus is on creating a thriving, composable ecosystem of applications that bring real utility to Bitcoin and help secure its future.”



They plan to deploy the capital across three priorities, he added. Scaling the “core engineering team,” ecosystem growth, and “expanding developer adoption.”



Basically, the team is hyper-focused on infrastructure as it works toward mainnet launch. Arch Labs is also using “grants, developer tooling and community programs to help turn Arch into the home for Bitcoin’s programmable economy.”



The team also plans to launch a token, but Mudano told me that they can’t disclose details at this time. What he did say, though, was that a native token is important in the team’s eyes, given that it will be used for both gas and staking. It would also help secure the network through “aligned incentives.”



“We’re being thoughtful about timing and strategy, especially in a market that’s still finding its footing,” he told me.



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How Arch Labs plans to deploy $13M raise

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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A bank, but make it DeFi.&nbsp;



Ether.fi is launching the first DeFi bank, a decentralized and non-custodial alternative to traditional banks.&nbsp;



Basically, the project is expanding into a new category, “which is not a traditional bank, in the sense that it doesn’t take users’ deposits, but it really is a viable alternative to banks,” CEO Mike Silagadze told me.



“Our plan from the beginning was to build this larger platform that really became a bank alternative for users,” Silagadze noted. “I think over the next year…you [will] actually see…half a dozen companies launch something that starts looking a lot like this, where it’s basically like a Revolut or a neobank…but built on DeFi crypto rails.”



As anyone who regularly uses DeFi knows, “there’s this&#8230;awful dance you have to go through, basically, where you put some stuff onchain, you do stuff there, hopefully you’re in some rewards or yields.” Then, Silagadze continued, “you have to get the money offchain,” so you go to an exchange and sell your crypto for fiat, and the fiat has to go somewhere… and yeah, you get the idea. It’s not an easy process.



Ether.fi’s goal is to onboard crypto natives that already use its other products, then work to onboard the less-crypto-native folks who use centralized exchanges or are perhaps crypto-curious.&nbsp;



Over the past year, the project has found success in its product launches and currently offers both Ether.fi Stake and Ether.fi Liquid.&nbsp;



“Even for myself, I probably do 70 to 80% of my finances now on Ether.fi and&#8230;hopefully soon, adding a few features, I’ll really be able to move close to 100%, which is what we want to offer to people. So that’s kind of&#8230;the culmination of this vision we had from the early days,” Silagadze told me.&nbsp;



But it’s also expanding to the US, with Silagadze noting that the country is “open for business for crypto companies” nowadays.&nbsp;



“Specifically, the staking product is opening up, and then the cash product is going to be available for most states in the US. The reason for that is twofold. One is obviously the new SEC. They disbanded the unit that was going after crypto and prosecuting people for all kinds of silly reasons, and now they’re working on the stablecoin bill,” he explained.&nbsp;



And the other reason is that the “licensing that we were able to get allows us to operate in the US.”



But this new move is something Silagadze and Ether.fi couldn’t have done six months ago. They were looking to launch new products, but he had thought the US was out of the question. Oh, how times have changed.&nbsp;



Right now, Ether.fi has roughly 200,000 users. That said, Silagadze noted it’s hard to keep track because folks have different wallets, but they’ll be able to pin down more accurate numbers as folks make accounts for the DeFi bank.&nbsp;



“Our internal goal is to get to about 100,000 cards by the end of this year. If we could get to that, we would feel pretty good about it,” he said.



I asked Silagadze if the expansion would require any further funding (the <a href="https://blockworks.co/news/ether-fi-funding-restaking-interest">firm last raised in February of last year</a>), but Silagadze told me they haven’t “touched the money.”&nbsp;



“We&#8217;ve been profitable since almost day one. So in 2024, we did about $22 million in revenue, and we were profitable this year. It depends on a lot of factors, but we’ll probably do&#8230;$40 [million] to $90 million in revenue, and very likely [be] comfortably profitable,” he explained.



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Banking

Ether.fi expands to US, launches DeFi bank

Byron Gilliam

This is a segment from the Blockworks Daily newsletter. To read full editions, <a href="https://blockworks.co/newsletter/daily">subscribe</a>.



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<blockquote class="wp-block-quote is-style-default is-layout-flow wp-block-quote-is-layout-flow">
“There are only two ways to make money in business: bundling and unbundling.”



— Jim Barksdale, former CEO of Netscape
</blockquote>



Stablecoins might unbundle banking (and then re-bundle it)



Bundling and unbundling aren’t the only ways to make money, of course — you can also invent something new or do an old thing more efficiently, for example.



But Jim Barksdale’s comment — made spontaneously to close a roadshow meeting for the Netscape IPO — became a dictum in tech circles because it explains a lot of things about the business of technology.



Much of the internet revolution, for example, can be framed as unbundling.&nbsp;



The internet caused newspapers to be unbundled into Craigslist, search engines and blog posts.



Fiber optics caused cable TV to be unbundled into streaming services.



Barksdale&#8217;s Netscape might be said to have unbundled the internet, letting users bypass bundled services like AOL and CompuServe, including email, news, chat and curated web access.



Sometimes, these unbundled services then get rebundled.



It used to be that to listen to a single song we liked, we had to buy 12 of them bundled into an album.



With the advent of the internet, we could buy each song individually as MP3 files (or download them illegally for free).



Now, we typically buy a bundle of millions of songs from Apple Music or Spotify.



Something similar may now be happening with crypto and banking.



Stablecoins are often described as tokenized dollars or money market funds issued by a crypto version of narrow banks.



But the best way to understand their potential significance might be as an attempt to unbundle banking.



Banks bundle all kinds of financial services: deposits, custody, payments, credit cards, lending, asset management, investment banking — most of which you are probably not interested in when you open a bank account.&nbsp;



Stablecoins, by contrast, offer the two services you are definitely interested in — the storage and transfer of money — and nothing else.



This might catch on because doing one thing well and leaving everything else out is often what disruptive technologies do best.



Stablecoins are a disruptive technology because they turn money into software — composable, portable and always on.



This is likely to cause problems for the legacy banks that are dependent on deposits as a cheap source of funding and whose offerings are encumbered by legacy systems and compliance regulations.



Stablecoins could take business from them by being a better kind of money offered in a better kind of checking account.



But that doesn’t mean that issuing them will be a better kind of business.&nbsp;



The risk disclosure section of Circle’s recent <a href="https://www.sec.gov/Archives/edgar/data/1876042/000119312525070481/d737521ds1.htm">S1 filing</a>, for example, is long and frightening: Competition, it warns, is “intense and increasing,” its profitability is dependent on interest rates (and therefore out of its control), CBDCs could “eliminate or reduce the need” for stablecoins, and regulation remains highly uncertain.



The S-1 also makes clear that it’s more expensive to issue stablecoins than Tether&#8217;s oft-cited results might have you think: Circle incurred $482 million of operating expenses in 2024 and just over $1 billion of “distribution, transaction and other costs.”



But you don’t have to read a 225-page S1 to be concerned — you only have to read this morning’s <a href="https://www.bloomberg.com/news/articles/2025-04-23/paypal-aims-to-boost-stablecoin-use-by-offering-3-7-on-balances?utm_source=telegram&amp;utm_content=crypto&amp;utm_medium=social">Bloomberg headline</a> that “PayPal Aims To Boost Stablecoin Use By Offering 3.7% on Balances.”



That 3.7% is only about 60 bps below the fed funds rate, which isn’t much of a gross margin for issuers to work with.



If that becomes the norm, how will they make money from stablecoins?



Barksdale’s dictum suggests that stablecoins might have to become a loss leader for other, more profitable services.



As Circle’s S-1 implies, stablecoins seem likely to be issued by payments companies, banks and crypto exchanges as a way to attract or retain customers, irrespective of profitability.



To stay competitive, stablecoin issuers might need to offer the same core services — payments, banking and exchanges — as the companies they’re disrupting.



In other words: rebundle!&nbsp;



There is precedent for this.



As Barksdale’s Netscape colleague Marc Andreessen puts it, startups that disrupt incumbents by unbundling their services “often end up reforming themselves into a version of the company they took down.”



This has been a recurring pattern: As startups grow, the natural strategy is to “stay focused on your core and then add things to it,” Barksdale explains.&nbsp;



“And before long, you become a big bundle again.”



A current example is Robinhood, which will <a href="https://www.bankingdive.com/news/robinhood-to-launch-banking-product-deepak-rao/744277/">soon</a> offer checking and savings accounts, payments and cash withdrawals in addition to its core business of brokerage.



It feels like only a matter of time until it adds a stablecoin to that offering (as it has <a href="https://www.bloomberg.com/news/articles/2024-09-26/robinhood-revolut-explore-entering-the-burgeoning-stablecoin-sector">reportedly</a> considered doing).



Robinhood would probably treat it as a loss leader, if so, and that could threaten stablecoin issuers’ already thin margins.&nbsp;



To stay profitable, stablecoin issuers might then have to rebundle some of the banking services they left behind.



They might even be required to rebundle.



The risk section of Circle’s S-1 filing includes a warning that “legislation requiring stablecoin issuers to be banks or to be affiliated with banks could materially affect our business.”



That may be why Circle and others are <a href="https://www.wsj.com/finance/currencies/crypto-knocks-on-the-door-of-a-banking-world-that-shut-it-out-082b3968?st=VkCCZA">reportedly</a> planning to apply for bank charters and licenses, despite the considerable cost that entails.



But could all this be an upside risk, too?



Bundling, after all, is one of only two ways to make money.



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<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
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Stablecoins might unbundle banking (and then rebundle it)

Jeff Albus

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



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



Solana is up. At $151.30, SOL is <a href="https://app.blockworksresearch.com/assets/sol?tags=sol&amp;interval=1m">back at monthly highs</a>, reversing an oh-so-steep early April dip. It&#8217;s pretty well outperforming broader crypto markets, which aren&#8217;t doing too badly themselves as they ride a wave of short squeezes, ETF inflows, and a sudden softening of trade war rhetoric.&nbsp;



Some ecosystem tokens caught the bullish wave, too, including Jupiter’s JUP, which is up 25% on the week.



Yesterday, <a href="https://app.blockworksresearch.com/research/jupiter-scale-synergies-and-scrutiny">a report from Blockworks Research</a> laid out all the ways in which Jupiter is becoming irreplaceable. Jupiter now commands 95% of DEX aggregator volume and 80% of perpetuals trading on Solana. It generates north of $280 million in annualized revenue and still trades at one of the lowest P/S ratios in DeFi.



Since launching in 2021 as a swap router, Jupiter has made no secret of its intent to become Solana&#8217;s super-app: home to perps, its own launchpad, a mobile wallet, a memecoin terminal, and more recently, NFT integrations via its DRiP Haus acquisition. Its liquidity index fund, JLP, is now the third-largest TVL pool on Solana — behind only Jito and Kamino. Its recent API upgrades (here&#8217;s looking at you, Ultra Mode) are quietly reshaping user behavior. I mean, come on. It&#8217;s pulling in $5–10 million in optional monthly fees.



Jupiter&#8217;s routing upgrades (Juno), cross-chain testnet (Jupnet) and rapid-fire acquisitions (SolanaFM, Coinhall, SonarWatch, Ultimate Wallet, Moonshot) signal a protocol building not just liquidity, but full-stack control. It&#8217;s a <a href="https://app.blockworksresearch.com/research/jupiter-scale-synergies-and-scrutiny">surgical level of vertical integration</a> rarely seen: data, analytics, interface and distribution, all consolidated under a single roof. Its treasury is buying back JUP at speed; so far, they&#8217;re over $20 million repurchased in under two months.



Risks worth watching mostly deal with looming token unlocks. The Jupiter team took heat recently-ish over its compensation and governance transparency. Plus, competition sharpens when winners emerge — Kamino, Titan and Drift aren&#8217;t going quietly. But Jupiter is digging a deep moat, and it&#8217;s doing this without relying on mercenary incentives. Ultra Mode usage is on the ascent. Aggregator dominance is stable. Perps volumes remain consistently above $25 billion per month.



While macro flows, ETF optimism, and geopolitical thawing may have sparked the week&#8217;s rally, Jupiter has helped things along by scaffolding Solana&#8217;s commercial core.



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Jupiter

Jupiter anchors growth as Solana surges to monthly highs

Ben Strack

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



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



Two weeks ago we wrote about <a href="https://blockworks.co/news/the-outlook-for-coin-as-macro-uncertainty-persists">the outlook for Coinbase</a> as macro uncertainty swirled. Cantor Fitzgerald analysts, at the time, initiated coverage of COIN — giving the crypto exchange’s shares a buy rating and a $245 price target.



Now, Benchmark analyst Mark Palmer has officially started examining Coinbase’s stock. He similarly gave it a buy rating, with a price target of $252.



When the Cantor pros wrote their COIN outlook on April 9, shares were trading for about $165 — less than half of what the stock was trading for in early December. At 1:30 pm ET today, the stock price hovered around $197.



Palmer notes that Coinbase’s partnership with Circle (allowing it to receive a portion of interest income generated from USDC reserves) means COIN will especially benefit from stablecoin legislation and increased adoption there.&nbsp;



Standard Chartered projects that the stablecoin market cap — currently about $230 billion — could hit $2 trillion by the end of 2028. As I mentioned in <a href="https://blockworks.co/news/yield-bearing-settlement-network-tokenization">yesterday’s newsletter</a>, Agora co-founder Nick van Eck cited that same number by 2030.&nbsp;



“As COIN continues to focus on the growth and expansion of its subscription and services offerings, the result should be a product mix with an increasing percentage of recurring revenue that should serve as a buffer against crypto market volatility,” Palmer wrote in a Wednesday note.&nbsp;



If you forgot, subscription and services revenue is a fancy name for Coinbase’s income streams not derived from transactions. In addition to stablecoin revenue, these include blockchain rewards and custodial fee revenue.



Subscription and services revenue <a href="https://blockworks.co/news/coinbase-q4-earnings">jumped to</a> $641 million in Q4 2024, a 15% increase from the prior quarter. That total represented 29% of Coinbase’s total revenue over that three-month period.&nbsp;



While Palmer pegs the compound annual growth rate of the company’s revenues at ~21% through 2026, he anticipates the CAGR for revenues from its non-trading offerings to be ~36% during that span.



Coinbase is set to report its Q1 results after the market closes on May 8. We’ll be tuning in.



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Coinbase

Revenue diversity fuels analyst’s latest COIN ‘buy’ rating

This is a segment from the Forward Guidance newsletter. To read full editions, <a href="https://blockworks.co/newsletter/forwardguidance">subscribe</a>.



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Bitcoin’s rise to a level not seen in more than a month has many wondering when its price will get back to six digits — and what exactly it will take.&nbsp;



Maybe not as much as you’d think.&nbsp;



Bitcoin was trading around $93,700 at 1:30 pm ET — up 12% from a week ago.&nbsp;



The crypto market benefits from a foundation of “long-term structural growth drivers,” YouHodler markets chief Ruslan Lienkha reminded me — namely deeper integration with TradFi, improving regulatory clarity in the US, adoption via bitcoin ETFs, etc.&nbsp;



A quick note on the inflows into the US spot BTC funds yesterday:



<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">$913 million into US spot bitcoin ETFs yesterday, per <a href="https://twitter.com/FarsideUK?ref_src=twsrc%5Etfw">@FarsideUK</a>. That&#39;s the 7th-highest single-day net flow total for those funds since launching 15 months ago. And a stark turnaround &#8230; <a href="https://t.co/LkE4cVGhs4">pic.twitter.com/LkE4cVGhs4</a>&mdash; Ben Strack 🟪 (@strack_ben) <a href="https://twitter.com/strack_ben/status/1915038239032815948?ref_src=twsrc%5Etfw">April 23, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Headwinds in recent months preventing a new all-time high above ~$109,000 include mixed expectations around US tariff policy, future Fed actions and the potential for a recession. That has, as you know, more broadly sent the stock market tumbling in recent weeks.



That said, Lienkha’s view is: “Bitcoin does not require a strong equity rally to move higher. Simply a stable and less volatile macro backdrop would likely be sufficient to support renewed upside momentum.”



While BTC crashed alongside equities earlier this month, it has more recently strayed from acting as a high-beta version of US tech stocks. BitMEX co-founder Arthur Hayes alludes to this in a Tuesday blog <a href="https://cryptohayes.medium.com/ski-cut-c24c971600c0">post</a> — and in his convo with Forward Guidance’s own Felix Jauvin.&nbsp;



<iframe loading="lazy" width="560" height="315" src="https://www.youtube.com/embed/bL8d97Wrt0E?si=pyRdsTflXMLRLUuF" 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>







“Now that the global community believes Trump is a madman crudely and savagely wielding the tariff weapon, any investor with US stocks and bonds is looking for something whose value is anti-establishment,” Hayes wrote in the blog post. “Physically, that’s gold. Digitally, that’s bitcoin.”



Major economies printing money to cushion the effects of declining globalization would serve as a tailwind for BTC, he added to Jauvin.



We’ve written before about how various market participants perceive bitcoin <a href="https://blockworks.co/news/investors-bitcoin-narrative-confusion">as a risk-on asset</a>. That’s despite the asset sharing global, scarce properties similar to gold — a metal that has hit new price highs amid the latest market turbulence.



Hayes believes BTC bottomed at $74,500, adding optimistically: “Bitcoin will shed its association with said tech stocks and will rejoin gold in the ‘Up Only’ cuddle puddle.”&nbsp;



I’ll say it for him — that’s not investment advice.&nbsp;



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Is BTC in ‘up only’ mode after rising above $94K?

Casey Wagner

It’s been weeks of mixed messages from the White House. Even as the administration flip-flops on tariff policies, one thing has remained consistent: Investors are acting on the slightest hint of good news.&nbsp;



Yesterday afternoon I wrote that markets were trading on a dream. I was talking about the rally we saw after US Treasury Secretary Scott Bessent reportedly said in a private meeting that the trade war with China is “<a href="https://blockworks.co/news/global-trade-us-china-deal">unsustainable</a>.”



That was nothing compared to the after-hours surge we saw later on Tuesday.&nbsp;



The main catalyst was a comment from President Trump. He told reporters yesterday afternoon that he has “no intention” of firing Fed Chair Jerome Powell. Trump added that he “never” planned on removing Powell despite previously posting that the Chair’s “termination cannot come fast enough.”&nbsp;



Markets got a second boost when Elon Musk said on Tesla’s Q1 earnings call that he’d be stepping back from his DOGE duties next month. The comment was enough to distract investors from Tesla’s first quarter miss and 71% decline in net income. Shares were up almost 7% midday Wednesday.&nbsp;



Stocks and the dollar rose, while Treasury yields retreated. It’s further proof that the market doesn’t need to see any tangible policy changes to rally.&nbsp;



US indexes were still in the green Wednesday, but the rally was fading. The S&amp;P 500 was trading 2% higher at 2:15 pm ET, while the Nasdaq Composite had gained 3%. The Dow Jones Industrial Average was up around 600 points, although earlier in the session it had added as many as 1,100 points.&nbsp;



The intraday pullback followed more remarks from Bessent, this time in a public appearance. The Treasury Secretary spoke at an IIF event Wednesday morning, saying that China “is in need of rebalancing.” He did not, however, reassure investors that the White House will be walking back its levies on the country — a comment investors would have appreciated.&nbsp;



“China’s current economic model is built on exporting its way out of its economic troubles,” Bessent said. “It’s an unsustainable model that is not only harming China but the entire world.”&nbsp;&nbsp;



Trump yesterday told reporters that tariffs on Chinese imports will “come down,” but “won’t be zero.” As of Wednesday afternoon, the White House had not commented further on the situation or the status of any negotiations.&nbsp;



The Wall Street Journal, however, just <a href="https://www.wsj.com/politics/policy/white-house-considers-slashing-china-tariffs-to-de-escalate-trade-war-6f875d69">reported</a> that China tariffs could land around 50% to 65%, citing unnamed senior officials. This would be less than half of the current level.&nbsp;



Confirmation on this would no doubt send stocks higher. In the meantime, at least Trump has taken firing Powell off the table.&nbsp;



We’ll share more updates tomorrow, when the tariff situation undoubtedly will be completely different.&nbsp;



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Donald Trump

US stocks retreat from session highs as China trade deal remains uncertain

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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A day after I <a href="https://blockworks.co/news/immutable-teases-potential-ubisoft-collab">reported</a> that Immutable’s about to drop some news about its game with Ubisoft, a <a href="https://www.prnewswire.com/news-releases/ubisoft-and-immutable-unveil-new-chapter-of-multi-million-player-franchise-might--magic-fates-302435428.html">press release</a> has been published announcing the upcoming game. 



The game will be an installment in the fantasy Might and Magic franchise called Might &amp; Magic: Fates. It’ll be a trading card game (TCG), which also confirms what I reported yesterday.



Might and Magic is a series of retro roleplay games (RPGs) from New World Computing and 3DO that first released all the way back in 1986. Ubisoft <a href="https://www.gamesindustry.biz/namco-ubisoft-and-ms-carve-up-3do-assets">bought</a> the rights to Might and Magic for $1.3 million in 2003 when 3DO filed for Chapter 11 bankruptcy. Over a dozen Might and Magic games have been released since the 80s, including official spinoff titles.



TCGs have been the most obvious genre for crypto game developers to build in because each card can be an NFT. Players can buy and collect digital cards as well as frames or special card backs for their decks.&nbsp;



Trading card games require fewer players to match up individuals in 1v1 matches (as opposed to massive battle royale games or team games, which can have much longer queue times). TCGs also don’t require players to be geographically close to each other for optimal gameplay, like fast-paced RPGs or shooters do.



TCGs can also make money — and can be made for less money than extensive 3D worlds like <a href="https://www.thegamer.com/difference-between-mmos-mmorpgs-online-multiplayer/">MMORPGs</a> or shooter games. Ad firm Udonis <a href="https://www.blog.udonis.co/mobile-marketing/mobile-games/hearthstone-player-count#h2-2">estimates</a> that Blizzard’s Hearthstone — arguably the most well-known TCG — has made over $900 million in total game revenue and makes millions of dollars per month (Key Banc Capital Markets <a href="https://www.bloomberg.com/news/articles/2019-07-07/hasbro-s-free-magic-the-gathering-arena-official-launch-is-2019">said</a> that number was $600 million annually in 2019).&nbsp;



Immutable reportedly made <a href="https://crypto.news/blockchain-game-developer-immutable-says-2024-outlook-improved-after-reporting-50m-loss/#:~:text=Following%20a%20%2450%20million%20loss,with%20revenue%20exceeding%20%24110%20million.">$110 million</a> in 2024.



But the TCG market is also competitive, even in crypto, with Axie Infinity, Gods Unchained, Splinterlands, Parallel, and other titles already playable.



Immutable’s VP of Business Development Andrew Sorokovsky said in a <a href="https://x.com/soro/status/1915030852926583295">post</a> the Might and Magic TCG will use Immutable’s zkEVM chain, which also confirmed my reporting from Tuesday.&nbsp;



The press release states that there will be “hundreds” of cards featuring different creatures and characters.&nbsp;



Immutable cofounder Robbie Ferguson <a href="https://x.com/0xferg/status/1915030006889353415">posted</a> a minute-long teaser cinematic promoting the upcoming game, which features an armored skeleton brought to life with green magic.&nbsp;



More gameplay footage as well as preregistrations are expected “in the coming months.”  Ubisoft is also publishing a noncrypto prequel installment in the Might and Magic series, called Heroes of Might and Magic: Olden Era, that is <a href="https://store.steampowered.com/app/3105440/Heroes_of_Might_and_Magic_Olden_Era/#:~:text=Might%20&amp;%20Magic%C2%AE-,Release%20Date:%20Q2%202025,English%20and%2010%20more">expected</a> to launch sometime this year.



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Gaming

Might and Magic makes crypto comeback as TCG from Ubisoft, Immutable

Macauley Peterson

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



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Restaking is evolving. What started as an Ethereum-native capital efficiency play is now transforming into a cross-chain economic coordination layer that spans protocols, assets and use cases.



<a href="https://blockworks.co/tag/symbiotic">Symbiotic</a> announced today a $29 million Series A, led by <a href="https://blockworks.co/tag/Pantera">Pantera Capital</a>, to launch its Universal Staking Framework. The move goes toward supporting any asset securing any network — L1 or L2, modular or integrated. Symbiotic is active on <a href="https://www.binance.com/en-JP/square/post/2024-08-16-symbiotic-announces-integration-of-14-networks-into-shared-security-framework-12233736521281">14 networks</a>, a number expected to more than double in the coming months, providing programmable slashing, cross-chain collateral composition and new financial primitives like staking-backed insurance and “structured risk products.”



“This isn’t a pivot, it&#8217;s an expansion — a natural progression of the vision we started with,” Symbiotic co-founder Misha Putiatin told Blockworks. “From the outset, we focused on building a flexible coordination layer that supports a wide range of use cases.”



While <a href="https://blockworks.co/tag/eigenlayer">EigenLayer</a> remains Ethereum-centric, with restaking built primarily via ETH-native validators and <a href="https://blockworks.co/tag/liquid-staking">liquid staking</a> tokens (LSTs), Symbiotic expands the model across networks and collateral types — enabling non-EVM assets and modular AVSs to coordinate security under a unified staking framework.



Of course, EigenLayer isn’t standing still. Just last week, Eigen Labs <a href="https://x.com/eigenlayer/status/1912885738116620670">activated</a> slashing on mainnet — the final piece of its original roadmap. In terms of scale, it’s way out in front. It even <a href="https://x.com/molinaxis/status/1914740005978677677">launched</a> its own marketing agency. More than 190 AVSs (actively validated services) are now building on EigenLayer, including heavyweights like <a href="https://blockworks.co/tag/LayerZero">LayerZero</a> and <a href="https://blockworks.co/tag/infura">Infura</a>. With slashing now live, these services can enforce performance guarantees backed by economic penalties.



EigenLayer founder Sreeram Kannan called it “the next phase in our mission to transform Ethereum’s trust into a programmable primitive.”



As EigenLayer cements its role as Ethereum’s trust marketplace, other players are extending the restaking model in novel directions. Puffer Finance, for example, <a href="https://x.com/puffer_finance/status/1914405809188184399">came out</a> earlier this week with staking and restaking vaults for institutions. Designed for asset managers, DAOs and custodians, Puffer’s platform combines ETH staking with EigenLayer AVS restaking together within a compliance-ready framework. Features include validator permissioning, withdrawal policies and modular configuration of restaking exposure.



Meanwhile, <a href="https://x.com/moremarketsxyz/status/1899384972404023394">MoreMarkets</a> — formerly Nuffle Labs — is using restaking infrastructure to unlock utility for previously siloed assets like <a href="https://blockworks.co/price/xrp">XRP</a>, <a href="https://blockworks.co/price/ada">ADA</a> and <a href="https://blockworks.co/price/doge">DOGE</a>. By integrating with <a href="https://blockworks.co/tag/wormhole">Wormhole</a> and AVS-layer attestations, MoreMarkets lets users stake or provide liquidity directly from their origin chain.



“Users shouldn’t be facing a bridging UI,” MoreMarkets CEO Altan Tutar told Blockworks. “They should just click once — from wherever they are — and start earning.”



Together, these developments mark a shift in how staking is conceived and deployed. It&#8217;s no longer just a consensus mechanism, but a programmable economic substrate. EigenLayer proved that trust could be abstracted. Symbiotic is showing that it can be recomposed. And protocols like Puffer and MoreMarkets are building the interfaces to bring it to institutions and long-tail assets.



Restaking isn’t just maturing, it’s mutating.



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Restaking goes ‘universal’

Pete Rizzo

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



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The final known Satoshi email was sent to Mike Hearn, one of the earliest Bitcoin contributors and former Google engineer, in April 2011. 



By that point, Bitcoin had been running for 840 days, or less than two and a half years. Satoshi previously said they had been working on Bitcoin’s design since 2007 — so at most they were active in Bitcoin development for about four years.



Hearn, who has since stepped back from Bitcoin, had kept up <a href="https://plan99.net/~mike/satoshi-emails/thread5.html">emails</a> with Satoshi even after their <a href="https://blockworks.co/news/satoshi-nakamoto-last-online">final post</a> on BitcoinTalk in December 2010.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXcZZVZwIwBSiK-A_RKyiyuhF1-ajEFlU7j9LEGzTBhYRwpb_jY63f8u3k1DCRz0g0yutHA4qo-fRdigBu4_4sFk-iYvJJONow9pgzgy6OeVg9rbPJvSFH4HEDpaL6fLi3RzxPZtgw?key=JL_yRvqxyiwt9MZUlz_5eEaa" alt=""/><figcaption class="wp-element-caption">Hearn hosts a set of Satoshi emails on his personal <a href="https://plan99.net/~mike/">website</a></figcaption></figure>



“Satoshi did not leave the community because of Gavin&#8217;s CIA visit. He had already stopped posting publicly by the end of 2010 but was willing to continue emailing back and forth with me for months after,” Hearn <a href="https://www.reddit.com/r/btc/comments/6t2ci2/never_before_seen_mike_hearn_satoshi_nakamoto/">wrote</a> on Reddit in 2017. “I realised this situation probably wouldn&#8217;t last which is why I kept peppering him with technical questions.”



Bitcoin’s creator had recently encouraged other community members to take over, a move that led to Gavin Andresen stepping up as lead maintainer. Alongside Hearn, Andresen would go on to <a href="https://en.bitcoin.it/wiki/Bitcoin_XT#:~:text=After%20Andresen's%20resignation%20from%20the,be%20implemented%20in%20Bitcoin%20Core.">organize</a> the forking of Bitcoin Core for BitcoinXT, which featured an increased block size limit that would also get larger every two years.&nbsp;



It was Bitcoin’s first great civil war, as <a href="https://www.theguardian.com/technology/2015/aug/17/bitcoin-xt-alternative-cryptocurrency-chief-scientist">portrayed</a> by mainstream media. Hearn had <a href="https://blog.plan99.net/the-resolution-of-the-bitcoin-experiment-dabb30201f7">sold</a> all his bitcoin by January 2016, when coins were worth under $500, and eventually moved on to build enterprise distributed ledger Corda as R3’s lead platform engineer, a position he <a href="https://www.ledgerinsights.com/lead-engineer-mike-hearn-departs-enterprise-blockchain-firm-r3/">left</a> in 2021.



“Can cryptocurrency work? Sure, I do believe that. It does need extensive competition between different coins, which we now have,” Hearn <a href="https://www.reddit.com/r/btc/comments/kc2k3h/comment/gforyhb/">wrote</a> in late 2020. “Unfortunately when it comes to currencies, competition works against gaining critical mass and none of them have managed to get the same levels of awareness Bitcoin did.”



“I did stoically plug away at it for many years, but fundamentally my answers to how you can build a global consensus network in which people peacefully co-exist looks like the Bitcoin Foundation or the Corda Network, and that was far too suit-wearing to ever be accepted by the cryptocurrency community.”



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXckpVhTXFhCobS35P4eANlFbWMH06ySXCOOfH1aa9r-WqOmUfDqdND_Ue5oeVea98BAXm49sTvUZUpxie6mq7wQ02wRxeBKN-8oQnwAeO_iQk6sFjzxYl7Ni83FszzRSUzX-XGwNg?key=JL_yRvqxyiwt9MZUlz_5eEaa" alt=""/><figcaption class="wp-element-caption">Satoshi had foreshadowed his leaving five months earlier on BitcoinTalk</figcaption></figure>



Certainly, we’ve all mused enough over the reasons for Satoshi’s departure. WikiLeaks “kicking the hornet’s nest” could be <a href="https://bitcointalk.org/index.php?topic=2216.msg29280#msg29280">one</a>. Andresen’s <a href="https://thenextweb.com/news/satoshi-nakamoto-left-bitcoin-because-of-the-cia-theory-cryptocurrency">visit to the CIA</a> could be too — Satoshi sent his last email to Hearn shortly after Andresen disclosed that he’d accepted the agency’s invite.&nbsp;



And perhaps, Satoshi really did have other balls in the air. He’d used similar language 11 months earlier, when he told Martti Malmi via <a href="https://mmalmi.github.io/satoshi/">email</a> that he’d “been busy with other things for the last month and a half” to explain his absence.&nbsp;



Maybe, Satoshi knew there was going to be tension between the cypherpunks, with their energetic anarchism, and the suits, with their rules and business hierarchies, and simply thought it easier to go return some video tapes instead. Who could blame them?



<h2 class="wp-block-heading">Rizzo, The Bitcoin Historian&#8217;s view</h2>



There history goes again, always rhyming. As David notes, the tensions in the community that Satoshi left may be alive and well, but then again, so is the inherent demand for Bitcoin, with the “<a href="https://satoshi.nakamotoinstitute.org/quotes/bitcoin-economics/">positive feedback loop</a>” he imagined working at a geo-political scale. Yesterday, shockwaves were sent across the industry when it was revealed SoftBank, Cantor Fitzgerald and Tether are <a href="https://bitcoinmagazine.com/bitcoin-for-corporations/softbank-tether-cantor-fitzgerald-prepare-3b-public-bitcoin-treasury-vehicle">reportedly</a> preparing to funnel bitcoin worth $3 billion into a new firm running the Strategy playbook, amassing capital to stockpile BTC.



The numbers alone are staggering. Could we have another Strategy? Another multi-billion company racing, alongside the ETFs, to capture 500,000 or more Bitcoin?  Certainly, the <a href="https://www.businesswire.com/news/home/20250423962305/en/Tether-SoftBank-Group-and-Jack-Mallers-Launch-Twenty-One-a-Bitcoin-native-Company-Through-a-Business-Combination-With-Cantor-Equity-Partners">players</a> involved are enough to make the suggestion plausible. The only question that remains is how much bitcoin can they buy? Regardless, it’s another example of how Satoshi’s <a href="https://satoshi.nakamotoinstitute.org/quotes/bitcoin-economics/">own stash</a> — and his foresight — only seem more impressive with time.



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What Bitcoin’s Satoshi and Patrick Bateman have in common

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



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Since last week, Base’s Jesse Pollak has been very busy posting about content coins and prompting folks in his replies to coin everything, though that’s come with some mixed results.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">&gt; post pic of random girl from dating app &gt; someone launches a shitter &gt; get mad bc guy screenshotted first and is *checks notes* &quot;a creator&quot; and this is &quot;stealing&quot; &gt; guy tokenizes girl, but with picture &gt; directly links &gt; 5k mcap what in the fuck are we doing here man <a href="https://t.co/vwiXKGqUbm">pic.twitter.com/vwiXKGqUbm</a>&mdash; mert | helius.dev (@0xMert_) <a href="https://twitter.com/0xMert_/status/1914728220697493584?ref_src=twsrc%5Etfw">April 22, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Before we get into Pollak’s bullish thought process, I asked him about the now-deleted post promoting an image of a girl from Hinge being coined. The image was a screenshot taken from the dating site, and it’s unclear if the girl consented to the image being not only used on social media but also being put onchain. Even if consent was given, however, it’s against Hinge’s <a href="https://hinge.co/terms">terms of service.</a>&nbsp;



“I want to clearly apologize for this post. I shouldn’t have posted it or amplified it. I heard the feedback loud and clear, which is why I quickly apologized and deleted the post,” he explained.&nbsp;



For Pollak, this process has required a learning curve in real time. He told me the goal was to experiment in public and lead by example, hence Base’s launch of “<a href="https://zora.co/coin/base:0xd769d56f479e9e72a77bb1523e866a33098feec5">Base is for everyone</a>” last week. He added that he was prepared for some backlash, but he&#8217;s hyper-focused on bringing a billion folks onchain, which will require some trial and error.&nbsp;&nbsp;&nbsp;



“That said, in retrospect, one thing I would have done differently is added more context to the Base handle initial post. I had been talking about this for a few weeks on my personal handle, and we included a disclaimer on the Zora post itself, but it wasn’t enough. We could have done more here,” he said.



While oversaturation is a concern I’ve heard from folks around the industry, Pollak dismissed it.&nbsp;



“The truth is that you want basically infinite content, because that lets you sort and filter through to find the world-class stuff,” he said. “One of the reasons I am continually coining content is to lead by example here. If this is a normal, everyday thing, then the expectations around each individual piece of content are also normalized.”



As for the great debate of content coins vs. memecoins, Pollak says that the expectations for memecoins are centered around the overall value and curating a community. On the other hand, “people should have no expectations around the value or utility of any single content coin,” in Pollak’s opinion.&nbsp;



“A content coin is a singular piece of content, and the market is free to decide on the value of that content,” he added, citing a bowl of granola he <a href="https://zora.co/coin/base:0x395d485b80bc367830bf7458ee0bf12b23ec387b?referrer=0x849151d7d0bf1f34b70d5cad5149d28cc2308bf1">coined</a> that has a current value of $3,500.&nbsp;



“I’m not doing anything to create a community around this piece of content. I’m not promoting it over the long term, I’m not making a Telegram group, and I’m not turning my photo of granola into a project with ongoing support. I’m just coining a photo of my granola, and then moving on to something else.”



Pollak dismissed the criticism around Base leaning into Zora, noting that Base has been “continually posting on Zora for two years.”&nbsp; “No one from the Zora team knew about the ‘Base is for everyone’ post in advance, and this was not a coordinated marketing effort,” he explained.



There were some other tidbits from Pollak that I wanted to cover.



Specifically, I wanted to hone in on the potential for content coins to generate more value for Base, and the idea that maybe this is Base’s solution to pump.fun, the infamous Solana memecoin platform.&nbsp;



“I have a lot of respect for the Solana team – they’ve done a lot to onboard people into crypto, and I’m glad to see that. We’re looking to grow the pie, not just compete for the existing pie,” Pollak said. “You don’t need to understand anything about crypto or the underlying infrastructure to post on Zora. Creators can just post their content, start earning, and experience the benefits of onchain social firsthand.”



One thing that I’ve struggled with is the audience for content coins. Pollak, being as bullish as he is, thinks this is a broad way to onboard folks.&nbsp;



He breaks the consumers into two buckets: The first are collectors engaging with content coins for fun and looking to earn a participation trophy for being onchain. Then there are the traders who aim to utilize this newer segment to turn a profit. We’ve clearly seen the rise of the latter thanks to memecoins, but it feels as though the former has been adrift for a while, at least since the popularity of NFTs dropped off.&nbsp;



“We think content coins can help all three segments: creators, collectors, and traders by bringing more content and value onchain,” he explained.&nbsp;



As with all of crypto, the big test will be how long the hype lasts. Memecoins, despite their success, couldn’t even withstand the changing tides. While there’s a decent possibility of success, I’m always wary of the fickle approach crypto takes to narratives.



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Base

What Jesse Pollak would’ve done differently in launching ‘Base is for everyone’

Michael McSweeney

This is The Riff segment from a recent edition of the Empire newsletter, where newsletter writer Katherine Ross and other contributors opine on recent happenings in crypto. To read full editions, <a href="https://blockworks.co/newsletter/empire" target="_blank" rel="noreferrer noopener">subscribe</a>.



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<h2 class="wp-block-heading">On our minds: Content coins</h2>



<h3 class="wp-block-heading">Katherine Ross: </h3>



I’m of two minds here. 



First (and this was my gut reaction), I wonder if we really need another segment that lacks inherent utility. And, like I wrote above, is this something that lasts? You all know my background prior to crypto. So you know I’m a big fan of things like fundamentals that can help better gauge value.&nbsp;



But the other part of me says I’m holding content coins to an unfair expectation. There are real tokens and projects that are pushing crypto forward — content coins shouldn’t be mixed in with them.



Pollak’s comments made me wonder if content coins could act as crypto’s social media moment (at first I typed TikTok moment, but I don’t think we’re there yet). If we pull back the expectations and let the content speak for itself, I can see a scenario where content coins have a memecoin moment without the volatility. 



And, honestly, things like content coins do push crypto forward. Personally, I’ve found the discourse around the viability and usability to be really enlightening — not to mention, it feels like it’s been a while since I’ve seen such a variety of takes.&nbsp;



That’s not to say I support some of the controversial things that have happened, such as promoting or coining the aforementioned Hinge screenshot, but that’s a whole other discussion I’m happy to have at some point.&nbsp;



<h3 class="wp-block-heading">Michael McSweeney: </h3>



Like Katherine, I’m of two minds as well.



On the one hand, I’m all for carving out new, weird use cases for tokens. Whether “content coins” will prove to have lasting power or be another flash-in-the-pan CT topic remains to be seen. The folks over at Base obviously have an incentive to see the former outcome realized, so heavy tweeting to that effect (see Katherine’s piece above) is all but guaranteed.



That said, I’m a touch dubious about the notion that content coins will somehow avoid what I like to call speculative destruction, the sort of which tends to send most coins, tokens, etc. to the dustbin soon after they pop.&nbsp;



I think people will develop speculative expectations around a prospective successful content coin because that’s simply what happens in crypto. It’s inherently a speculative game. Always has been. I don’t think some kind of special immunity to those market forces will be conferred because someone came up with a new mode of thinking (though I’m happy to be wrong, as always).



I think if someone creates a content coin and people find a reason to speculate on it, the typical crypto market forces will almost certainly follow —&nbsp;especially if someone with some cash to burn sees a way to make money off whichever narrative surrounds that coin.



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Can content coins avoid ‘speculative destruction?’

This is a segment from the Blockworks Daily newsletter. To read full editions, <a href="https://blockworks.co/newsletter/daily">subscribe</a>.



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“I respect his independence,” former President Nixon reassured the White House crowd at the 1970 <a href="https://www.presidency.ucsb.edu/documents/remarks-the-swearing-dr-arthur-f-burns-chairman-the-board-governors-the-federal-reserve">swearing-in</a> of Fed Chair Arthur Burns.



“However, I hope that independently he will conclude that my views are the ones that should be followed.”



There’s no video of the event, so it’s hard to say for sure, but I’m guessing that was meant as a joke.



It’s also exactly how things worked out.



Burns famously allowed Fed policy to become subservient to Nixon’s political goals, fueling the 1970s epidemic of inflation.



The much-maligned Fed chair <a href="https://www.cato.org/publications/commentary/failed-fed">reportedly</a> acknowledged this as a tactical surrender: &#8220;We dare not exercise our independence for fear of losing it.&#8221;



Subsequent Fed chairs have fought their corner more resolutely, stressing that the Federal Reserve is an independent agency within government.



“Our independence is a matter of law,” Jerome Powell <a href="https://youtu.be/XUFVr430VLU?si=8g0IAiEL-1KBEuZn">said</a> just last week.



But that plain statement may mean less than it sounds.



Specifically, Powell meant that individual members of the FOMC are insulated from politics because they can’t be fired: “We’re not removable except for cause,” he noted. “We serve very long terms.”&nbsp;



(“Seemingly endless terms,” he added, drawing a laugh from the sympathetic crowd.)



This, he says, allows the FOMC to do its job “strictly without consideration of political or any other extraneous factors.”



“We’re never going to be influenced by any political pressure,” he promised.



If so, that would be a new development.



For the first two decades of its existence, political influence on the Fed was explicit: By law, the treasury secretary automatically served as the chair of the Federal Reserve as well.



That changed in 1935 as the Fed gained a measure of independence with the chair becoming a presidential appointee, no longer tied to the Treasury Department.



In 1951, the Fed won a further degree of independence when the Treasury Department formally agreed that the Fed could set interest rates without its input.



Still, this hard-won independence remained contingent on political approval.



The Fed was established by an Act of Congress and Congress retains the ability to revise the Act if it disapproves of how its creation is operating.



This is why, at his final press conference as Fed chair, Ben Bernanke offered a simple piece of <a href="https://www.richmondfed.org/publications/research/econ_focus/2016/q2/federal_reserve">advice</a> to his successor, Janet Yellen: “Congress is our boss.”



It’s been a reluctant boss, for the most part — after delegating its Constitutional power over money to the Fed, Congress has generally only held the Fed accountable after financial disasters.



Often, the Congressional response to those disasters is to grant the Fed more power, not less.



This is by design.



In <a href="https://www.amazon.com/Myth-Independence-Congress-Governs-Federal/dp/0691163197/ref=sr_1_1?crid=9YHOJHSKC7T0&amp;dib=eyJ2IjoiMSJ9.bsZyT3haiztxYj-2kE6IVQ.JVQBzmH_0aksmHRtvUROqFvO2YSV6vL3czdA0R9vIZM&amp;dib_tag=se&amp;keywords=the+myth+of+independence+how+congress+governs+the+federal+reserve&amp;qid=1745285598&amp;sprefix=the+myth+of+independ%2Caps%2C160&amp;sr=8-1">The Myth of Independence</a>, Sarah Binder and Mark Spindel explain that, whatever Fed chairs like to say, the Federal Reserve is actually “interdependent” with Congress — and that Congress retains the ultimate authority through the Federal Reserve Act and its power to revise it.



The Fed, they explain, is dependent on Congress for its authority and Congress is dependent on the Fed for its stewardship of the economy.



This arrangement works for Congress largely because it gives them someone to blame when things go wrong — Binder and Spindel note that former Fed Chair William Martin once testified in Congress that “we’re here to be blamed.”



The result, they say, is that the Fed is &#8220;acutely sensitive to the need to secure political support for its policy choices.”



Similarly, the monetary economist James Dorn <a href="https://www.cato.org/sites/cato.org/files/2019-09/cj-v39n3-5.pdf">found</a> that “the Fed is independent, but in practice that independence is continuously tested by political pressures for using accommodative monetary policy and credit allocation to win votes.”



It&#8217;s mostly been presidents who’ve exerted that political pressure.



Truman called William Martin a “traitor”; LBJ summoned the long-serving Martin to his Texas ranch to verbally assault him over interest rates; Burns was famously subservient to Nixon; Carter reassigned former Fed Chair William Miller to the Treasury Department because interest rates were too low; Paul Volcker was able to raise rates to 20% only because he had Reagan’s backing.



Dorn’s study found all this presidential pressure to be effective: “An examination of the evidence reveals that presidents tend to get the monetary policy they desire,” he concluded.



As a matter of principle, that may not be the worst thing — we wouldn’t let unelected bureaucrats set tax rates without political recourse, so why should we let Fed bureaucrats set interest rates?



As a matter of practice, however, it hasn’t worked out well.



In a <a href="https://econweb.umd.edu/~drechsel/papers/drechsel_political_pressure_shocks.pdf">study</a> of presidential influence on the Fed, the economist Thomas Drechsel unsurprisingly found that political pressure increases inflation “strongly and persistently.”



Specifically, he concluded that “increasing political pressure by half as much as Nixon, for six months, raises the price level more than 8% after a decade.”



Drechsel also found that presidential pressure to lower interest rates negatively affects GDP.



The effect is mild, but he cites it as evidence that “political pressure is not successful” for presidents hoping to win votes by raising economic activity.&nbsp;



That hasn’t stopped them from trying, of course, as we were reminded this week.



Does publicly calling Chair Powell a “major loser” amount to half as much political pressure as Nixon applied on former Chair Burns?&nbsp;



If so, history suggests we have an 8% increase to the price level to look forward to.



Or does President Trump’s schoolyard name calling amount to, say, twice as much pressure?&nbsp;



Drechsel doesn’t do the math on that because, before this week, who could have imagined a president exerting twice as much pressure on a Fed chair than Nixon did with Burns?



But investors appear to be doing the math for themselves: Bitcoin ETFs took in <a href="https://farside.co.uk/btc/">$381 million</a> yesterday — a notable reversal of the recent trend.



That’s helped push the price of bitcoin to near an <a href="https://x.com/MikeZaccardi/status/1914676954868973719">all-time high</a> relative to the S&amp;P 500 — a surprisingly sensible reaction to renewed presidential pressure on a Fed chair.



When former President Nixon swore in Chair Burns in 1970, gold traded at $35 an ounce.



When President Carter swore in Chair Volcker in 1979, it was about $300 and on its way to a high of $850 a year later.



Markets seem to sense the Fed has another tough decade ahead of it — one spent fighting for its independence.



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