Epic Face-Off: Lido Investors Clash with EigenLayer
A few weeks ago, the term “investable asset class” being used for meme coins caused quite a stir. Despite initial skepticism, this category is now being taken seriously by many investors and projects. Here’s a detailed look at recent developments in this space.
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SCOOP: Lido investors are covertly backing a contender to EigenLayer.
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BREAKING: Two brothers have been charged by U.S. authorities for exploiting MEV-boost software and embezzling $25 million.
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Vitalik Buterin drafted an Ethereum improvement proposal in just 22 minutes.
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Colony Lab’s new “liquid vesting” feature allows for retained asset liquidity.
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Runes transactions seem to be on a decline.
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Top picks from the past week’s
Protocol Village
column: Hyperbolic, Lens, zkSync, Polkadot, CoinDCX, Cyber, OP Stack.
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$100 million in blockchain project fundraising: Polymarket, Humanity Protocol, Owlto, Arcium, AgriDex, Zest, Hylé.
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Latest Developments
MEME COIN SURGE: “You’re starting to hear venture capital firms refer to meme coins as an investable asset class,” an industry insider mentioned over drinks recently. It’s clear that meme coins are on the rise. CoinMarketCap listed 138 new meme coins in April, compared to just 18 the previous year, totaling 2,229 meme coins with a market cap exceeding $50 billion. VanEck, an institutional investment firm friendly to crypto, launched a Meme Coin Index tracking tokens like dogecoin (DOGE) and dogwifhat (WIF). Additionally, the token FLOKI sponsored a cricket series between Pakistan and Ireland. Analysts are drawing attention to election-themed meme coins like TRUMP and BODEN, as well as Wolverine-themed tokens. Even Jimmy Song, an independent Bitcoin developer typically critical of non-Bitcoin tokens, praised the “honesty” of meme coins in a Substack post. The Bitcoin blockchain itself now has meme coins, many created with the Runes protocol, which Sovryn used to introduce POWA tokens.
RESTAKE REVOLUTION: Reports indicate that Lido’s co-founders are secretly financing a competitor to EigenLayer. This new project, Symbiotic, is supported by Lido co-founders Konstantin Lomashuk and Vasiliy Shapovalov, through their venture firm Cyber Fund, and crypto VC firm Paradigm. Symbiotic enables users to “restake” using Lido’s staked ether (stETH) and other assets that are incompatible with EigenLayer.
NEW MEV EXPLOIT ALLEGATIONS: Two brothers have been detained by the U.S. Department of Justice for allegedly exploiting the Ethereum blockchain to steal $25 million within a brief 12-second attack window, as detailed in a recently unsealed indictment.
VITALIK’S SPEEDY PROPOSAL: Ethereum co-founder Vitalik Buterin is known for his substantial writing output. Recently, with a significant meeting on Ethereum wallet standards impending, Buterin swiftly crafted EIP-7702 in a mere 22 minutes, offering it as an alternative to the widely criticized EIP-3074. The fast publication gained quick support within the Ethereum community, replacing the previous proposal.
The courtroom where Tornado Cash developer Alexey Pertsev was sentenced. (Camomile Shumba/CoinDesk)
Alexey Pertsev
## Developer Convicted in Tornado Cash Money Laundering Case
A Dutch court has convicted a 31-year-old developer associated with the Tornado Cash coin mixer for money laundering, sentencing him to 64 months in prison. This verdict has ignited a global debate about the accountability of developers for the code they create. Authorities argued that the developer should have been aware of the illicit activities facilitated by the Tornado Cash platform.
Inside Job Discovered in Crypto Trading Protocol Cypher
In a surprising turn of events, Solana-based crypto trading protocol Cypher fell victim to an inside job. A developer operating under the pseudonym Hoak confessed to embezzling hundreds of thousands of dollars from Cypher’s hack reimbursement fund. Hoak attributed his actions to a severe gambling addiction, stating, “I took the funds and gambled them away.”
El Salvador Launches Bitcoin Tracking Website
El Salvador has introduced a new online platform to monitor its $350 million bitcoin reserve. This initiative aims to provide transparency and ease of access to real-time data on the nation’s bitcoin holdings.
Degen Chain Resumes Operations Post-Outage
Degen Chain, an Ethereum layer-3 blockchain specializing in meme coins, has resumed activities after a two-day outage. Launched in March, Degen Chain offers an ultra-low-cost L3 built with Arbitrum Orbit, Base for settlement, and AnyTrust for data availability, according to infrastructure partner Syndicate.
The Shadowy World of Crypto Influencers
A recent investigation has delved into the operations of “key opinion leaders” (KOLs) within the crypto community. These influencers often invest in the projects they promote on social media, gaining early access to sell their holdings before other investors, thus raising ethical concerns within the industry.
Highlights from Protocol Village
Hyperbolic’s Proof of Sampling Protocol
Hyperbolic, a startup led by math prodigy Jasper Zhang, has unveiled its Proof of Sampling (PoSP) protocol. This decentralized AI computing initiative aims to enhance trust within AI networks. Founded in 2022, Hyperbolic is co-led by Yuchen Jin, a Ph.D. graduate in computer science from the University of Washington.
Lens Lab Introduces Lens Network
Lens Lab, part of the Avara team behind Lens Protocol, is developing its own blockchain network named Lens Network. Built on Matter Labs’ ZK Stack and leverages zkSync on Ethereum, it seeks to revolutionize how social networks are conceptualized and operated.
Polkadot Introduces Asynchronous Backing
Polkadot has announced the rollout of Asynchronous Backing, signaling the advent of Polkadot 2.0. This upgrade promises to halve block time and enhance the network’s scalability, cost-efficiency, and transaction speed, significantly boosting the growth of decentralized applications.
CoinDCX Expands Okto Ecosystem
Indian cryptocurrency exchange CoinDCX has broadened its Okto wallet into a comprehensive Okto ecosystem. This expansion includes the creation of a blockchain, a native token, and a points program aimed at simplifying the Web3 experience for global users.
Cyber Launches Layer-2 Blockchain for Social Applications
Previously known as CyberConnect, Cyber has launched its own layer-2 network within the Ethereum ecosystem. Marketed as the ”first L2 for social applications,” Cyber integrates advanced modular solutions to provide low fees and high transaction speeds.
EasyA Consensus Hackathon: Call for Participants
Consensus will host its first-ever in-person hackathon in collaboration with the leading Web3 learning app, EasyA. This three-day, multi-chain event aims to gather the world’s top developers to innovate the future of Web3 and secure funding for their projects. If interested, sign up here as spots are limited.
Liquid Vesting: A New Blockchain Mechanism
Colony Lab, a project incubator within the Avalanche blockchain, has introduced “liquid vesting.” This new feature allows early investors to access liquidity without waiting for the traditional vesting period, posing a unique solution but also generating ethical concerns within the crypto trading environment.
Finance News
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Polymarket, a cryptocurrency predictions market, has successfully closed a Series B funding round securing $45 million, with significant backing from investors including Peter Thiel’s Founders Fund.
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Humanity Protocol, a decentralized identity project leveraging zero-knowledge proofs to compete with Worldcoin, has raised $30 million in a seed round. This funding, spearheaded by Kingsway Capital, values the project at $1 billion.
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Owlto Finance, known for its intent-centric interoperability, garnered $8 million in strategic funding. Leading this round were Bixin Ventures and CE Innovation Capital, also supported by Hailstone Labs, Skyland Ventures, Presto Labs, and SNZ Capital.
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Arcium, the pioneering parallelized confidential computing network, has closed a $5.5 million strategic funding round led by Greenfield Capital.
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AgriDex, a platform for tokenizing agricultural commodities on Solana, raised $5 million in pre-seed funding from Endeavour Ventures, African Crops, and Oldenburg Vineyards.
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Bitcoin lending protocol Zest secured $3.5 million to enable BTC holders to generate yield on-chain. Billionaire Tim Draper led the seed funding, alongside Binance Labs, Flow Traders, Trust Machines, and others. Zest Protocol utilizes Bitcoin layer 2 Stacks’ Nakamoto upgrade.
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Hylé, specializing in zero-knowledge proof (ZKP) verification blockchain technology, announced closing a $2.6 million funding round with leadership from Framework Ventures.
Runes Protocol’s Popularity Declines
Last month, we covered the explosive launch of the Runes protocol built on Bitcoin, which surged in popularity immediately after the bitcoin halving. This spike caused transaction fees to skyrocket as users rushed to mint new meme coins, congesting the blockchain. As of last week, Runes transactions dominated the Bitcoin blockchain, outnumbering bitcoin transfers and other transactions like Ordinals and BRC-20 standards.
However, interest in Runes appears to have dwindled. According to Coin Metrics, enthusiasm has not matched the early hype, with Runes subsequently being labeled a ‘flop.’ Despite this, analysts believe there is still a chance for a revival, noting that Runes have yet to be listed on major exchanges, currently trading mostly on niche collectible platforms. Transaction volumes have notably decreased:
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