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Marc Andreessen was right — our timelines really are splitting. 



Andreessen, on the Joe Rogan Experience in late November, theorized that our timeline had already split twice in the previous four months.



If that’s true, our universe has obviously diverged a third time with the launch of Trump’s official cryptocurrency, TRUMP, this past weekend.



The first occurred when Trump was shot last July. “And there was that moment where the world was going to head in two totally different directions [if Trump died],” Andreessen said. 



Instead, we got the “most conspicuous display of physical bravery” he’s ever seen, referring to the almighty fist pump combined with a call to “fight, fight, fight!” — a killer combo now being used to promote TRUMP.



“Right at that moment it could have gone, you know, horrifically badly for the entire world after that. So that was timeline split number one. That other timeline's out there somewhere,” Andreessen said. “And I don’t want to visit it. That’s the bad place.”



Trump’s win on election day in November caused the second rift, per Andreessen, paving the way for TRUMP to permanently split our timeline a third time — for better or worse.



Melania’s team also appears to have launched a token, which has already flipped AI16Z and WIF.



TRUMP’s coin is worldwide news. It was deployed on Solana on Friday evening and took only 90 minutes to hit a $1-billion market cap, and barely another day to break $10 billion — making it a top 20 coin alongside toncoin, sui, litecoin and shiba inu.



While only 10% of the total TRUMP supply is currently available to the public, leading to some outcry, it’s hard to say how many people bought TRUMP on its way up. 



Onchain data points to 110,000 individual addresses acquiring it in its first three hours of DEX trading and over half a million within the first

TRUMP is much more than a memecoin

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Donald Trump begins his second term as President of the United States on Monday, and after an expensive campaign season, crypto will finally get its president. 



Bitcoin gained momentum following Trump’s victory, largely due to his pledge to create a strategic bitcoin reserve that would see the US Treasury Department accumulate nearly 5% of all bitcoin. But Trump taking office may still reap benefits for a less reserve asset and more use case focused network in Solana, industry participants say.



SOL is up 19% on the week leading up to Trump’s inauguration. The asset spiked 5% right after the New York Post reported the incoming president is “receptive to the idea” of a second strategic crypto reserve of tokens founded in the US like SOL, XRP, and USDC.



On that point, listen: I’m receptive to the idea of playing in the NBA, but that doesn’t mean you’ll see me suiting up for the Knicks this weekend. I think Paradigm’s vice president Alexander Grieve was prescient on the America-first crypto reserve.



“View such stories with skepticism until it comes from [Trump] or his staff,” Grieve wrote in an X post yesterday. “And question why such details might be in the press in [the] first place—[and] who might have put them there.”



There was other reporting on the Trump-crypto front that felt much more plausible this week however. Reuters reported that under President Trump, the Securities and Exchange Commission would “potentially freeze” crypto litigation that does not come with allegations of fraud. 



The SEC sued Coinbase and Binance in 2023, alleging that the crypto exchanges operated as unregistered broker-dealers for facilitating the trading of SOL, among other tokens. 



In defining SOL as a security, Gary Gensler’s SEC essentially said that US firms that exchange the token are breaking the law. This is because it has only given out

What’s to come for Solana under a Trump presidency?

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President-elect Donald Trump has made a lot of promises for his first day in office, to the crypto industry and otherwise. 



With his inauguration just days away, let’s review some of his vows: 



Increase tariffs 



Trump’s proposed tariff plans have made headlines for months. In late November, though, he made a new promise: a 10% increase on China, plus 25% tariffs on Canada and Mexico. The latter two countries quickly signaled they were willing to negotiate. 



Just this week Trump said that the “External Revenue Service,” a new agency that would be tasked with collecting tariff income, will be created on Monday. We at Forward Guidance are of the belief that tariff increases will happen at a much slower pace, though. 



Commute Silk Road creator’s sentence



Trump in May pledged to commute the sentence of Ross Ulbricht, who has been serving a double life sentence plus 40 years since 2015. 



Ulbricht  was convicted on seven federal counts including narcotics conspiracy and money laundering for his role in founding the Silk Road marketplace. Prosecutors also presented evidence during trial supporting allegations that Ulbricht had paid $730,000 in murder-for-hire fees, but he was not charged with this crime. 



Overturn SAB 121



Trump reportedly plans to reverse the SEC’s controversial SAB 121 guidance, which states that crypto custodians should list custodied assets as liabilities on their balance sheet. 



President Biden last year vetoed a bipartisan resolution that sought to do just this, arguing the legislation “would inappropriately constrain” the SEC.







Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.



Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the Forward

Trump’s day 1 promises come due 

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After the 2024 launches of US bitcoin and ether ETFs, proposals for funds holding solana, XRP and even HBAR surfaced. Others would, if greenlit, diversify across multiple coins.



There was also a litecoin ETF plan from Canary Capital Group that the firm amended this week. Nasdaq submitted a 19b-4 form on Canary’s behalf — with some considering this step a positive sign for the product’s fate.



Canary CEO Steven McClurg told me he has “a high level of confidence” there’ll be more spot crypto ETFs in the US market this year, declining to get too specific.



We’ve heard industry watchers offer their “when, not if” optimism. But as the proposal stack grows bigger on the proverbial SEC desk (we’re in the digital filing age, didn’t you know?), the key question is what exactly it will take for these to get the go-ahead.



And with a new SEC administration, are we talking weeks, months or years?Bloomberg Intelligence’s James Seyffart (who spoke with me and Felix recently) noted on X that a litecoin ETF could see the light of day before SOL and XRP offerings.




To be clear, i view a Solana or an XRP ETF approval from the SEC as a matter of "when" not "if" at this point but Litecoin *MIGHT* get through first -- largely because of a lack of accusations that Litecoin is a security from the SEC— James Seyffart (@JSeyff) January 16, 2025




One of the reasons would be that the SEC — in lawsuits against Coinbase and Binance, for example — has not labeled litecoin as a security. 



It did however put SOL in that securities category. And you know about the agency’s legal battle with Ripple. If you need a refresher, Casey yesterday detailed the SEC moving forward with an appeal in that case.



ETF.com analyst Sumit Roy agreed an LTC ETF may have better odds due to “its simpler use case and history,” avoiding some regulatory scrutiny tied to

ETP: Exchange-traded patience

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In the first ACD call of the year following the holiday break, Ethereum core developers were focused on tying up loose ends on the upcoming Pectra hard fork.



Devnet 5, which went live shortly before the call, may be the last [network implemented] before moving on to the testnet phase, tentatively scheduled to begin in early February. System contracts for Pectra underwent bytecode audits, with all changes already implemented. A follow-up presentation on audit findings will occur in two weeks.



A significant part of the discussion focused on refining the gas refund mechanisms. EIP-7623, which aims to clarify the handling of gas refunds, was successfully merged, resolving issues with the order of gas refund application. A fix addresses a lingering point for Pectra, ensuring that transaction gas costs align with expected outcomes.



Another key feature under scrutiny was EIP-7840, which pertains to base fee updates in Ethereum's future. Marek Moraczyński from the Nethermind team provided context for a proposal aiming to streamline configuration and bring consistency to Ethereum, enhancing network efficiency.



As Ethereum looks to pick off any low-hanging fruit to help with scaling, other improvements are working their way toward developer consensus. One, related to BLS precompilation gas costs under EIP-2537, seeks to align gas constants with prior assumptions. Radek Zagórowicz from the Ipsilon team explained that “the easiest fix to the spec is...correcting the constant so it follows their previous assumptions.” This adjustment ensures gas costs are consistent, aligning with Ethereum’s larger goal of efficient scalability.



Gas limits on the Holesky testnet were discussed, with a proposal to keep them elevated, relative to mainnet, for testing purposes. For instance, the gas limit would increase to 60 million after the Pectra fork, and progressively rise with

Pectra progress: Gas refunds, audits and Ethereum leadership talk

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Coinbase is shaking things up. 



If you somehow didn’t hear, Morpho and Coinbase have teamed up to offer loans where Coinbase users (though New York users can’t, much to the disappointment of some of my colleagues) can borrow USDC against bitcoin held on Coinbase. Pretty cool, right? Definitely yet another sign of the changing times. 



Blockworks data whiz Dan Smith joined Empire’s round-up this week, telling host Jason Yanowitz that he thinks the announcement is a win for bitcoin… with some caveats.



“ Bitcoin's money, they [Coinbase] want it to be everywhere,” Smith said. But the asterisk, as he called it, is that the loanee now has to trust that Morpho can hold that bitcoin as collateral on Base. This can, understandably, cause anxiety about that going wrong.



As Smith pointed out, the upside is that Coinbase is the largest centralized exchange in the US.



For some folks, that’ll be enough to entrust Morpho and Coinbase with holding their loaned bitcoin. 





Watch today’s Empire roundup through the jump



There’s been a lot of demand for the product, according to Coinbase’s VP of Product Max Branzburg.



Smith, in the episode, also noted that the pairing of onchain lending startup Morpho and Coinbase here is a huge win for the former.



For Branzburg and Coinbase, Morpho was the go-to because it has “built some really great products in this area, and has built protocols that are very well audited that are safe, secure, [and] provide that kind of value.”



But he’s not ruling out the potential for other integrations with other projects. 



“As more people are building on base, we'll find ways to bring Coinbase users to those builders,” Branzburg said. 




The future of finance is onchain.Onchain is faster, more efficient, and more global - and it's now in the hands of millions of Coinbase users with billions of dollars of assets

Coinbase's bitcoin-backed loans are just the start

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True believers of an impending altcoin season now have their most compelling evidence to date:



XRP is at all-time highs (sort of), and the XRP Army is finally looking like the smart ones in the room.



It’s for sure a big deal. Price records for XRP have turned out to be crypto’s answer to Haley’s comet: They only come around once every half-decade or so. Which is eons around here.



There’ve been mixed reports over whether XRP has really broken its 2018 peak. A Fortune piece yesterday pointed out that XRP’s all-time high is $3.84 on Binance while CoinGecko says $3.40.



XRP reached as high as $3.3991 on Binance on Thursday afternoon, per TradingView data. So eh, close enough. 



Not to mention, Ripple Labs CTO David “JoelKatz” Schwartz has historically been adamant that XRP had never actually reached $3.84 in 2018 for most of the crypto trading world.



That price was supposedly met only briefly on South Korean exchanges, which at the time placed a hefty premium on many top coins, including BTC and XRP.



Keep in mind that the goal for most crypto traders and investors is to avoid “round-tripping” their bags — holding coins from bull market top to bear market trough and back again.



Real roundtripping in XRP’s case would mean holding through a 90% collapse between January 2018 and December 2019, and another 80% drop between April 2021 and the following June.







Here’s the rub: because XRP’s last all-time high was so long ago, its equivalent today would be much higher due to US dollar inflation.



What was $3.40 in 2018’s money would now be $4.25. XRP would need to rally by another 25% or so to break its inflation-adjusted all-time high, as shown by the beige area at the top of the chart above.



But that’s only against the dollar. XRP’s bitcoin and ether ratios continue to be firmly underwater, even despite its near-500% rally

Roasting Ripple: XRP Army finally becomes the smart money

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Multicoin Capital was one of Solana’s early investors. Now it’s trying to change the network’s inflation mechanism.



The Austin, Texas-based firm published a Solana Improvement Document this morning that would change SOL emissions from the current fixed schedule to a market-based solution. Multicoin’s proposal would likely drive down inflation — which dilutes SOL holders — but would also lower staking yields, which are a boon for SOL stakers.



In Solana terms, inflation refers to the network issuing SOL to the validators who run Solana’s software and help build the blockchain. Validators then pass this issuance along with some MEV rewards to the stakers who delegate staked SOL to them. 



In brief, Multicoin’s proposal sets a target staking rate of 50% for security and decentralization purposes. If more than 50% of SOL is staked, then issuance would decrease to discourage staking by reducing yield. If less than 50% of SOL is staked, then issuance would increase to raise yields and encourage staking. The minimum inflation would be 0%, and the maximum would be based on the current Solana issuance curve. 



Solana’s inflation rate was initially set at 8%, and this figure will decrease by 15% yearly until it reaches 1.5% inflation. SOL’s inflation rate is currently around 4.8%, according to Solana Compass. Solana co-founder Anatoly Yakovenko said on the Lightspeed podcast that the fixed rate idea was borrowed from the Cosmos blockchain, and inflation is just “accounting.”



Yakovenko doesn’t care much about inflation, because the process of SOL issuance doesn’t create or destroy value, it simply moves value around. Newly-minted SOL gets passed along to stakers, while non-stakers see their holdings become relatively less valuable.



Still, Multicoin sees a reduction in SOL inflation as necessary for a few reasons. New SOL being passed only to

Solana to weigh possible SOL inflation cut

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Ever since COVID closed global economies in 2020, gauging where we stand in the business cycle has been a very difficult act. 



The typical business cycle looks as follows, and historically, it’s been fairly easy to have a general idea of where we stood by contrasting it with interest rates and monetary policy:







However, everything has been somewhat upside down in recent years, leaving many economists befuddled. 



For example, in 2022 we saw negative real GDP prints (initially at two but then revised down to one):







However, during that same time we saw one of the hottest labor markets we’ve ever seen, as per JOLTS data. 



It’s hard to believe in a recession with a labor market that strong:







Since 2022, we’ve seen a major rate hiking cycle from the Fed that somehow also didn’t tilt the economy into a recession when looking at it on an aggregate basis. Stocks hit new highs everyday, the labor market cooled but remained resilient, and GDP growth powered ahead.



During that same time, however, if you honed in on the manufacturing and goods sector and set aside the services economy, it almost looks like we’ve just been through a manufacturing recession. 



ISM Manufacturing PMIs have been in contraction territory for a couple years now:







During that time, we saw significant disinflation leading to outright deflation in the goods sector of the economy:



Source: inflationguy.blog 



Fast forward to today, and we’ve seen the Fed cut rates to frontrun concerns about the labor market and continue attempting a soft landing of the economy where we move into a new business cycle without a recession.



We’re now seeing leading indicators hinting that the manufacturing sector might be exiting the doldrums and heading toward a new upswing.



We’re starting to see commodities begin to break out after two years of consolidation,

Are we at the start of a new business cycle?

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The SEC has moved forward with an appeal in its case against Ripple. 



The securities regulator is seeking to reverse a 2023 ruling that determined retail sales of Ripple’s XRP token were not unregistered securities offerings. Federal Judge Analisa Torres said that blind/programmatic sales of XRP, which occur on exchanges, were not in violation of US securities laws. 



“The district court erred both factually and legally in concluding that defendants’ offers and sales of XRP to public buyers who purchased on crypto asset trading platforms,” the SEC wrote in its opening brief, filed late last night. 



Even if buyers didn’t know their XRP tokens were coming from third parties or Ripple itself, Ripple still led the public to have “reasonable expectations of profits” from the cryptocurrency, the SEC said. Ripple’s “public marketing campaign…specifically engaged ‘less sophisticated’ investors,” the regulator added. 



Ripple chief legal officer Stuart Alderoty dismissed the SEC’s claims, writing on X that the brief is nothing but “a rehash of already failed arguments.” 



Plus, Alderoty added, new leadership at the SEC is likely to "abandon" the case altogether.  



On this last point, I’m less certain that the SEC will drop this case after Trump takes office and Chair Gary Gensler departs, at least immediately. It’s possible, but any decisions Commissioners Hester Peirce and Mark Uyeda make in the short term (before three additional commissioners are appointed and confirmed) will face harsh legal scrutiny. 



We’re much more likely to see commission votes resume after there are at least three sitting commissioners.







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SEC moves ahead with Ripple appeal in Gensler’s final days 

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Amid ongoing speculation about an American strategic bitcoin reserve, several US states are looking to take matters into their own hands. 



“It's time for Texas to lead the way in establishing a strategic bitcoin reserve,” Texas senator Charles Schwertner wrote in a Wednesday X post. 



The GOP lawmaker’s proposal calls bitcoin a valuable digital asset “with strategic potential for enhancing this state’s financial resilience.” Its decentralized nature and finite supply are “unique qualities that can serve as a hedge against inflation and economic volatility.”



The draft bill seems to echo a Texas House proposal from Rep. Giovanni Capriglione last month. 



The reserve would be a “special fund” outside the state treasury’s general revenue fund. The comptroller would be responsible for establishing secure custody of the BTC (i.e. via cold storage) and may contract a US-based third party for help. 



The Texas legislature — by a two-thirds majority vote in each house — can direct the comptroller to transfer, sell or convert the reserve’s BTC. It would then deposit proceeds to another state treasury fund or account. 



Meanwhile, a lawmaker from Oklahoma (Cody Maynard) introduced a bill to allow the state treasurer to invest public funds in BTC, stablecoins or any other digital asset with an average market cap north of $500 billion over the previous calendar year. 



Money used for such purchases could come from the state’s general, revenue stabilization and/or constitutional reserve funds. The amount it invests in BTC can’t exceed 10% of the public funds in the account. 



These proposals follow similar ones by Pennsylvania, New Hampshire, North Dakota and other states.



While the fate of Cynthia Lummis’s national BTC reserve plan remains unclear, at the very least Trump has promised to keep the BTC the government already

State bitcoin reserve plans proliferate

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The rise of “Bitcoin DeFi” on new networks looking to scale Bitcoin has primarily come through bitcoin-backed derivatives like SolvBTC.BBN and LBTC. These derivatives receive staking rewards from Babylon, offering new avenues for liquidity and yield generation. However, concerns about the transparency of these platforms, particularly regarding the management of bitcoin reserves, have sparked debate within the Bitcoin community.



A recent article by the co-founder of Nubit, known online as Hans, raised alarms about the potential for unbacked reserves and the inflation of total value locked (TVL) in platforms like Solv. These concerns highlight broader risks in the bitcoin-backed derivatives space, especially as market volatility persists.



SolvBTC is minted by depositing either BTC or flavors of wrapped bitcoin so that solvBTC tokens mirror the value of the BTC held in reserves 1:1.



But after that, solvBTC can be moved freely across chains and apps, making it challenging to track TVL. That led to allegations of double-counting solvBTC issuance.



Solv co-founder Ryan Chow called the claims “a smear campaign, coordinated and orchestrated” by Solv’s competitors.



SolvBTC.BBN suffers from a liquidity discount which deepened to 7% last week following a hack of the protocol’s X account.



Solv has pledged to reimburse user funds lost as a result of the hack.



Despite these clarifications, the core issue remains that Solv, like other bitcoin-backed derivatives platforms, introduces additional layers of trust. While some transparency improvements are being made, the underlying reliance on centralized mechanisms to mint and manage bitcoin-backed derivatives adds risk for users. As @0xTindorr pointed out in an X thread defending Solv, any bitcoin liquid staking tokens (LSTs) inherently carry additional risk.



As the bitcoin-backed derivatives market continues