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The infrastructure layer: Layer 1 and Layer 2 networks, interoperability, developer tooling and the protocols that everything else is built on. This desk covers upgrades, outages, funding and the technical decisions that determine which chains institutions can build on.

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Sui Network releases post-mortem on $260M Cetus hack
AI News

Sui Network releases post-mortem on $260M Cetus hack

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The Sui network has released a post-mortem report regarding the cause of the $260 million Cetus hack that shook up its ecosystem last week. 

According to the post-mortem report, the main reason for the Cetus incident was a problem in a math library used by Cetus, not a weakness in Sui or Move. 

Move is a programming language for creating smart contracts on various blockchain platforms, and Sui is a Layer-1 blockchain project.

However, based on the report, the effect on users is still the same. As a result, Sui Network revealed that they needed to adopt a more effective approach and improve their efforts to support the ecosystem’s security. 

Apart from this, the report also highlighted that the network was designed to allow for safer smart contract development, making the first significant incident for a dApp a “deeply sad” moment for the team. 

Sui team takes effective measures to strengthen the network’s security

Last week, the $223 million crypto hack hit the network’s largest decentralized exchange and liquidity provider, Cetus Protocol. Luckily, the network managed to freeze $162 million while Cetus put out a $6 million bounty to reclaim the other $60 million of stolen funds.

The Cetus team earlier stated that they were collaborating with the Sui Foundation and other groups in the ecosystem to recover the remaining funds. The Sui Foundation confirmed that many validators had identified the addresses linked to the stolen funds and were blocking transactions on those addresses until further notice. The Cetus team was looking for ways to recover those funds and return them to the community.

In addition, to enhance the network’s security, Sui has decided to invest an extra $10 million in security efforts. The network will use this money for audits, bug bounty programs, and formal verification. The team also aims to work with the developer community to finalize these security strategies. 

Concerning the incident, the team mentioned that it marks a coming-of-age experience, which, according to them, is something every major blockchain has unfortunately faced. They further supported their claim with the argument that no design or programming language can prevent humans from creating bugs. 

Therefore, the Sui team has urged community members to use this incident as a lesson to learn from it to strengthen vital code on the network and assist builders in taking the necessary steps to come back stronger. 

Following the CoinMarketCap report, SUI’s price currently trades at $3.49, reflecting a 3.07% decrease in the past 24 hours.

Growing cases of cybersecurity raise serious concerns in the crypto world

On May 22, the Cetus DEX experienced a hack that was thought to have happened due to a smart contract code issue, resulting in the loss of around $223 million in user funds. 

Based on the information from the Extractor Web3 security notification tool team, $63 million of the stolen money was moved to the Ethereum network. They also reported a wallet address ending in “AF16” that the hackers used to launder 20,000 Ether worth about $53 million. 

The recovery efforts and the freezing of assets, organized by various projects, platforms, and validators in the Sui ecosystem, received mixed reactions from the crypto community. 

Following this, one user commented that the action was good news for the victims. However, according to the user’s argument, if the 114 validators could freeze wallets whenever they wanted, it raised serious concerns about the network’s ability to resist censorship. The user then concluded that Sui was far from decentralized.

Notably, the Cetus hack is the latest incident affecting crypto and Web3 in the first half 2025. On top of that, cybersecurity still remains a big concern in the crypto world, with many leaders in the industry urging the sector to self-regulate and strengthen defenses to avoid more regulatory attention. 

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Trump says “Putin has gone absolutely crazy” as Russian president breaks ceasefire
AI News

Trump says “Putin has gone absolutely crazy” as Russian president breaks ceasefire

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President Donald Trump, from inside the White House, posted a long message on Truth Social Sunday night, saying Vladimir Putin “has gone absolutely CRAZY” and accusing him of bombing Ukrainian cities “for no reason whatsoever.”

Trump said he used to have a strong and beautiful relationship with Mr. Putin but he now believes that the Russian president has completely lost his mind. He also blamed Volodymyr Zelenskyy, the Ukrainian president, for worsening the war with his public statements, and said Joe Biden’s actions fueled the disaster.

“This is a war that would never have started if I were president,” Trump said. “This is Zelenskyy’s, Putin’s, and Biden’s war, not Trump’s.”

According to a report from RuNews24.ru, Putin responded to Trump’s recent call for a 30-day ceasefire by launching 250 drones and 14 ballistic missiles into Kyiv and other cities on Friday night.  Ukrainian officials reportedly said their forces intercepted nearly 100 drones near Moscow.

Putin hides war budget as secret spending surges

The Kremlin has buried nearly a third of its federal spending behind classified labels. Russia’s budget law from December mentions the word “secret” 39 times, as reported by RuNews24.ru.

Yakov Yakubovich, from Russia’s National Research Nuclear University, said the classified chunk of the budget is 12.12 trillion rubles, or around $152 billion, making up 29.22% of total spending. Last year, that number was 11.1 trillion rubles or $121.19 billion, according to data published by Bloomberg.

Yakubovich explained the funds are most likely being used for war-related infrastructure and operations in newly seized territories. He added that publishing this information could lead to more sanctions, which is why it’s being kept out of public view.

The surge in secret spending comes as Europe struggles to meet Ukraine’s growing demand for military supplies. Zelenskyy confirmed that domestic weapons production is improving, but shortages of both manpower and equipment remain.

Zelenskyy, in a statement Friday, said, “With every such strike, the world sees more clearly that it is Moscow that’s prolonging this war.” He called for tougher sanctions on Russia’s economy, warning that only more pressure would bring Putin to negotiate seriously.

Washington debates pressure while Trump pushes diplomacy

Marco Rubio, Trump’s Secretary of State, defended the administration’s approach in Senate testimony Tuesday. He said Ukraine is still receiving arms from the US and allies, even though the administration hasn’t requested new funding or tapped into fresh stockpiles.

Rubio also said the European Union is finalizing additional sanctions while the US looks to obtain more Patriot missile systems from NATO allies.

When asked if Trump is being manipulated by Putin, Rubio said that wasn’t true and insisted all sanctions from the Biden era remain active. He explained that Trump wants to avoid threatening new sanctions immediately, hoping to keep Russia engaged in talks.

But those talks are falling apart fast. Putin didn’t show up personally for the recent negotiation session in Istanbul. Instead, a low-level delegation was sent to meet with Rubio, who was dispatched by Trump.

In Washington, Lindsey Graham and Richard Blumenthal introduced a new bill co-signed by 81 senators, warning that if Russia refuses to negotiate in good faith, the US will respond with direct sanctions.

Graham said the Senate is prepared to slap a 500% tariff on any country, including China, that keeps buying Russian gas, oil, or uranium. He said Putin has only days to submit ceasefire terms. “If it is more of the same,” Graham said, “Russia can expect decisive action from the United States Senate.”

Sergei Lavrov, Russia’s Foreign Minister, said Moscow’s terms will depend on the “root causes” of the war. He said Ukraine needs a new government, one that’s “legitimate,” before a real peace deal can happen. Russia still insists that Ukraine is part of its territory and calls Zelenskyy’s government corrupt and Nazi-run.

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Elon Musk’s X isn’t ready for super app status
AI News

Elon Musk’s X isn’t ready for super app status

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On May 24, 2025, millions of X users worldwide suffered an outage for hours, the latest in a string of disruptions that have plagued the company lately. Users couldn’t log in, access timelines, or send messages, hardly the hallmarks of a platform aspiring to become a “super app.”

Elon Musk’s vision for X is clear: a single, integrated platform that merges social media, payments, messaging, AI services, and commerce. But so far, the execution hasn’t matched that goal. For all of X’s ambitions, the platform struggles to maintain basic functionality, let alone support a layered suite of financial and transactional services.

For some observers, this discrepancy highlights a bigger issue. Is Musk trying to do too much to be able to manage such a formidable transformation?

Building a super app requires discipline, not chaos

The super app model, epitomized by WeChat in China, is nuanced. In addition to an incumbent backend that can handle enormous, interlocking functions, it demands strict regulatory alignment, cultural assimilation, and relentless focus.

WeChat did not evolve through improvisation; it matured under coordinated leadership, with deep cooperation from regulators and a coherent product roadmap.

X, by contrast, appears to have adopted an approach defined more by urgency than discipline. In the last year alone, Musk has announced initiatives ranging from encrypted messaging and peer-to-peer payments to AI-generated news and dating features. Yet these product ambitions have coincided with frequent platform outages and a marked decline in service reliability.

Super apps do not succeed by layering complexity onto unstable systems. They thrive on trust—technical, operational, and institutional. And trust is difficult to maintain when the platform itself appears brittle.

Stretching leadership across six companies risks systemic failure

Musk’s portfolio is without precedent in modern corporate history. He is the owner and CEO of Tesla, SpaceX, Neuralink, xAI, The Boring Company, and X. Each of these demands persistent execution, high-stakes decision-making, and deep technological engagement. 

Tesla alone is navigating autonomous driving challenges, supply chain pressures, and cutthroat competition in the EV market. SpaceX is scaling Starship and managing a constellation of Starlink satellites. Neuralink recently entered human trials.

Under such conditions, even the most capable leader risks diffusion. The physical demands of running one high-growth, technologically complex company are immense. Running six is a structural risk.

Tesla shareholders have raised issues about this very dynamic. In early 2024, investor letters questioned Musk’s focus, particularly as political rhetoric and regulatory conflicts on X drew attention away from Tesla’s core innovation agenda. SpaceX insiders have reportedly expressed similar unease over reputational spillover from X.

Nowhere is the strain more visible than at X itself. The May outage, reportedly caused by delayed server patching and misconfigured fallback systems, reflects technical debt and a lack of sustained executive oversight. Such failures are less likely in environments where leadership focuses on operational resilience.

Slashing staff without a clear strategy has weakened X’s core operations

Compounding the problem is X’s dramatic downsizing. Since Musk’s acquisition, the company has shed more than 80% of its workforce, including infrastructure specialists, product leads, and compliance personnel. Many of these were responsible for platform reliability, trust and safety, and regulatory alignment.

Layoffs of this magnitude might have been manageable under a strategically phased reorganization. Instead, X has lurched from crisis to crisis. Product rollouts have lacked cohesion. Infrastructure appears brittle. Regulatory uncertainty is another concern, particularly as the company explores payments and financial services in tightly regulated jurisdictions.

To dismiss Musk outright would be premature. His track record—disrupting the auto industry, commercializing spaceflight, and vertically integrating battery supply chains—is extraordinary. The same goes for his work ethic and eye for spotting top-tier talent.

Some of Musk’s supporters argue that his model of leadership—visionary, high-leverage, selectively engaged—is sufficient if paired with strong deputies. That argument has merit. If X’s operations were led by a dedicated CTO accountable for execution and platform integrity, Musk’s focus could be confined to product vision and business alliances.

There are also potential synergies across Musk’s companies. Starlink could enhance X’s market reach, xAI accelerates AI integration for content moderation or personalization, and Tesla’s payment expertise could support its financial infrastructure.

Yet none of these synergies remove the need for consistent, hands-on leadership within X. The core challenge is not merely technological—it is managerial.

Pursuing a super app vision requires more than Musk’s ambition

Even with perfect leadership, X faces formidable barriers to super app status in the West. The regulatory environment in the U.S. and Europe is more fragmented and stringent than in China. Data privacy laws, antitrust scrutiny, and payment licensing regimes impose real constraints. 

Moreover, X faces entrenched competitors: Apple for payments, WhatsApp for messaging, and Amazon for commerce. In this context, building a Western WeChat is not just difficult; it may be structurally unviable. The ambition may be sound. The execution model, however, must evolve.

X need not abandon its super app ambitions but must rethink how it pursues them. A platform that seeks to become the central hub for communication, finance, and commerce requires unbroken focus, deep operational expertise, and robust governance.

Musk has proven himself an exceptional founder and visionary. However, the role of the platform’s technical steward, particularly at this stage of X’s evolution, may require different leadership. Appointing a CTO with a mandate for stability, compliance, and execution could restore confidence and increase the odds of success.

And in the end, no matter how compelling the vision is, it cannot replace presence. Super apps require more than innovation; they require constancy, precision, and trust. Without X closing the gap between ambition and leadership bandwidth, its super app hopes might not be more than a dream.

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Google’s AI Search could erode Reddit traffic
AI News

Google’s AI Search could erode Reddit traffic

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Google is reshaping how users find answers online, and that’s spelling trouble for Reddit. The tech giant introduced a significant update to its search engine at the Google I/O 2025 conference.

The new feature, AI Mode, changes the standard Google Search bar to resemble an AI chatbot. These features provide users with direct, AI-generated answers to queries, often summarizing content from various sources, including Reddit, without requiring users to visit the original sites.

AI Mode offers human answers instead of the standard list of links. It’s driven by a customized version of Google’s Gemini 2 generative AI model. The tool can answer tricky questions, search many sources at once, and give the results in a reader-friendly way.

AI Mode was first launched to U.S.-based Google One AI Premium users in early 2025. Google has announced that it will be officially available to every user in the U.S. over the next few weeks. A worldwide launch is planned for later this year.

“AI Mode is where we will first bring our frontier capabilities into search,” CEO Sundar Pichai said. He referred to it as a “complete overhaul” of the search experience.

The change is part of a broader effort by Google to remain competitive in the battle over AI-powered search. Competitors like Microsoft, with Bing AI, and OpenAI’s ChatGPT have already incorporated similar features. Google’s answer is audacious — and possibly fraught with risk.

AI Mode puts Reddit’s search traffic at risk

One platform with the potential to be heavily affected is Reddit. Traditional Google Search has been very good for Reddit.

You can use any search engine you want, but many of us end up on Reddit when looking for human answers to real-world problems, regardless of whether we are logged in. Google has even prioritized Reddit links in the search rankings in recent years, understanding that users can often put more trust in a forum than a cookie-cutter website.

But with AI Mode, Google could start answering user questions directly from data scraped off sites like Reddit—without ever driving a click to them. So fewer people will potentially click through to Reddit properly.

This is no small concern. The recent growth on Reddit has been powered largely by logged-out users—people who browse Reddit casually and find the site via search. These users are not the loyal base of Reddit, but they do have numbers.

If AI Mode starts feeding Reddit-style responses without pointing to the site, that could be the quickest path to drying up a big source of visitors. That fear is already being reflected in the market.

In February, Reddit’s stock tumbled more than 15% after the company announced its traffic had been “choppy” since Google’s search algorithm changed. Reddit’s chief executive, Steve Huffman, has said Google’s updates have meant that Reddit is unsure what traffic it can count on going forward.

Reddit strengthens its community to offset AI traffic loss

While search traffic is nice to have, the company’s strength is its logged-in user base. These regular users visit Reddit directly and participate in community discussions.

These users stay longer, engage with more meaningful content, and bolster ad revenue.

However, Reddit is also developing its own AI tools. In March 2025, it introduced Reddit Answers, an AI system that surfaces useful summaries from Reddit threads.

Now, the platform is putting Reddit Answers front and center by adding it to its main search bar to help people find authentic, community-driven content more easily. This is a play partly in defense and partly in offense. It tries to lock users onto the platform using AI tools from Google and others.

Reddit’s CEO, Steve Huffman, expressed confidence in the long-term value of human voices despite the rise of AI in search. He acknowledged that large language models (LLMs) change how people search online.

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HSBC goes live with tokenized deposits in Hong Kong amid global banking shift
AI News

HSBC goes live with tokenized deposits in Hong Kong amid global banking shift

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  • Multinational bank,  HSBC Holdings, has launched a blockchain-based settlement service in Hong Kong. The product which tokenizes deposits is the first of its kind by a regulated financial institution in the city. 

According to a report from SCMP citing HSBC official statements, the settlement service allows the conversion of bank cash deposits into digital tokens on the blockchain. This will allow the bank’s corporate customers to make real-time payments using US Dollars (USD) and Hong Kong Dollars (HKD).

The service is expected to reduce the cost of client transactions and ensure that payment can happen within a shorter period and at all times. The Hong Kong Monetary Authority (HKMA) supported the initiative through its Supervisory Incubator for Distributed Ledger Technology.

Speaking on the achievement, HSBC’s global head of domestic and emerging payments for global payments solution, Lewis Sun, said it can improve payments and cash management.

Sun said:

“Tokenised deposits, when supported by regulated financial institutions, can offer a safe and fully compliant approach to improving payments and cash management for [companies].”

The service already has its first user, with Alibaba affiliate Ant International using it for an instant fund transfer. Ant noted in a separate press release that the pilot test of the product using Ant’s blockchain-based global treasury management platform, the Whale.

HSBC integrated the experience from the pilot testing into the tokenized deposit service before the full launch.  Currently, the service is only available in Hong Kong, but HSBC plans to expand it to other countries in Asia and Europe by the year’s second half.

Big banks are embracing tokenization

Meanwhile, the launch of the tokenized deposits is only another step in the long-term tokenization plan for HSBC. The bank launched gold tokenization as far back as 2023 and plans to use the blockchain network and technologies to create a new digital transfer and settlement infrastructure.

Part of its planned use cases include digital currency settlements and other forms of tokenization. The bank has been exploring various uses of digital ledger technologies with initiatives such as tokenized bonds, the Orion blockchain platform, and several others.

However, it is not alone; several other major banks and financial institutions have identified tokenization as the next frontier for the financial markets. Institutions such as BlackRock, JP Morgan, Visa, Mastercard, and others are all exploring the incorporation of tokenization into payments and financial markets.

Several banks, including Bank of America, Euroclear, and Italian Central Bank, also recently tapped Solana as a tokenization layer after developer R3 partnered with Solana Foundation to connect its private blockchain Corda to the public network.

The massive interest in the sector from every stakeholder, both traditional institutions and fintech companies,   explains why researchers predict it could be worth $30 trillion by 2030.

Hong Kong status as digital finance hub increases

Meanwhile, HSBC’s choice of Hong Kong to launch the tokenized deposit service highlights how the city has become a major hub for global financial innovation. Hong Kong has been active in its efforts to attract financial technology and digital assets companies with regulatory clarity and government-banked initiatives.

Unsurprisingly, the tokenized deposit service is a product of one of such initiatives, with HSBC being one of the key participants in Phase 2 of the city’s e-HKD Pilot Program. The program focuses on banks experimenting with how tokenized fiat currencies can be used in digital asset transactions. The bank has also been involved in HKMA projects such as mBridge and Ensemble.

Interestingly, Hong Kong also recently passed a Stablecoin bill that expands its regulatory framework for digital assets by requiring all stablecoin issuers to get a license from the HKMA. The government claims that the new law, which is expected to come into force this year, will provide financial stability while encouraging innovation.

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Polygon co-founder quits, leaving the crypto giant at a crossroads
AI News

Polygon co-founder quits, leaving the crypto giant at a crossroads

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Mihailo Bjelic, a Polygon co-founder, has resigned from the blockchain project he helped build. He is stepping down from the Polygon Foundation board and ending his role at the main development studio, Polygon Labs.

Bjelic shared an X post stating, “After much thought and reflection, I’ve decided to step down from the board of the Polygon Foundation and wind down my day-to-day involvement with Polygon Labs.”

This makes him the third founder to leave the team. He joins co-founders Jaynti Kanani and Anurag Arjun, who had also stepped away from their active roles in the blockchain project. Kanani left the company in October 2023, while Arjun stepped down in March 2023 to concentrate on his modular blockchain project, Avail.

Bjelic claims he can no longer give his best to Polygon

Bjelic has played a pivotal role in taking Polygon to greater heights. In 2017, he co-founded the well-known Ethereum Layer 2, originally named Matic Network, along with Jaynti Kanani, Sandeep Nailwal, and Anurag Arjun. 

Ethereum’s Layer 2 scaling solutions provide many advantages for the Ethereum network. These benefits include faster transaction times, lower fees, and better scalability. As a Layer 2 solution, Polygon uses these features to boost its own performance and improve the experience for its users. 

In support of this, it is evident that the firm has made significant contributions to blockchain research and development, particularly in zero-knowledge and proof-of-stake technologies.

Polygon introduced MATIC for POL-on a one-to-one basis in late 2024 and initiated a token migration as a part of its 2.0 plan. This change was to drive more usage of the network’s main token for gas fees, staking, and infrastructure such as AggLayer. 

Following Polygon’s success, Bjelic’s 10+ years of experience as an IT engineer building technology products and platforms were greatly honored.

However, on Friday, May 23,  Bjelic shared an X post stating that he could no longer give his best to Polygon. Based on his explanation, as projects developed and evolved, it was natural for ideas to shift and sometimes become divided up. Afterward, Bjelic mentioned that Polygon leaders seemed sincerely dedicated to seeing the project prosper. He then offered support to them from the sideline and for whatever he could do to assist.

Following his resignation, Nailwal praised Bjelic in an X post, stating he was not only a co-founder but also a brother to him. He added, “From the earliest days — whiteboards full of ideas, endless whitepapers, governance frameworks, strategy calls deep into the night — you have been a force behind so much of what makes Polygon.”

Bjelic reveals himself as a strong crypto believer

Bjelic revealed that he first learned about cryptocurrency in 2013. By 2017, he was really diving into it, excited by the idea of creating a worldwide, inclusive economy. Since then, he has dedicated himself to making that amazing vision a reality. 

This is evident since Polygon’s launch in 2019, as Bjelic and his colleagues have made great progress. According to reliable sources, they have achieved important advancements in zero-knowledge technology and brought on some of the biggest brands in the world, moving closer to that big dream.

By undertaking this great journey, Bjelic initially highlighted taking pride in this and felt lucky to collaborate with many skilled individuals. 

Concerning his resignation, he mentioned that he still felt just as enthusiastic about the potential of cryptocurrency to change systems, empower people, and build a fairer world. Therefore, he added that this belief continues to motivate him, and as a result, he will probably be seen around.

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Ethereum’s trillion-dollar rebrand masks deep trouble as Solana eats its lunch
Blockchain

Ethereum’s trillion-dollar rebrand masks deep trouble as Solana eats its lunch

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Ethereum is trying to clean up its image just as it’s losing its grip. The Ethereum Foundation launched a campaign in 2025 called the “Trillion Dollar Security Initiative” to promote the blockchain as the only serious option for securing real-world value.

But the effort comes at a time when the project is slipping across the board, from price performance to user attention and developer support, while Solana is gaining fast.

The message coming from Ethereum’s leadership is all about stability, uptime, and security. But Ether, the token that runs on it, hasn’t kept up with Bitcoin since the Merge upgrade was rolled out in 2022. The gap has only widened.

The Ether-to-Bitcoin price ratio has stayed on a downward slope since then, and Ethereum has struggled to pull in new interest even as it added new tech upgrades. Instead of regaining momentum, it has seen core users and builders Ethereum’s leadership walk away.

Solana gains traction while Ethereum loses ground

In 2024, Solana’s active developer count jumped by 83%, while Ethereum’s dropped by 17%, data from Electric Capital showed. Cheaper fees and better user experience on Solana have pulled in a younger crowd that’s more focused on speed, memecoins, and new ideas than Ethereum’s long-term vision.

That same audience drove Solana’s price to an all-time high earlier this year while Ether stayed mostly flat. Ethereum’s ecosystem has gotten too fragmented, and developers are opting out of dealing with Layer-2 rollups like Base and Arbitrum just to get basic dApps running.

Even the Ethereum Foundation’s own move to promote security is being questioned. Katie Talati, head of research at Arca, said the new initiative was less of a breakthrough and more of a branding effort. “This feels more like a marketing repositioning from the Ethereum Foundation than an actual technical innovation,” Katie said.

“I don’t believe that this announcement alone will be enough to recapture developer and user mindshare. But over the long term, a greater focus on security guarantees via improvements to UX/UI will attract more developers. Users, however, only come when there is something interesting to use.”

Part of Ethereum’s current struggle comes from its scaling progress. After the Dencun upgrade last year, Ethereum did make progress on moving activity off the main chain. But most of that activity landed on Layer-2s.

The core network hasn’t kept that momentum, and as a result, Ether’s burn rate has dropped. That weakens the coin’s previous deflationary pitch, one of the key reasons investors used to hold it in the first place.

Wall Street push fails to spark interest in Ether ETFs

Now, Ethereum’s leaders are chasing attention in Washington and on Wall Street. A group called Etherealize, formed with support from Ethereum co-founder Vitalik Buterin and led by researcher Vivek Raman, is focused on lobbying for the blockchain’s future in traditional finance.

Vivek explained the strategy in an email, saying, “We speak to TradFi and Wall Street players all day and in the end — a blockchain’s security is the most important quality to ensure trust.” He added that Ethereum’s role will be as “digital oil” to complement Bitcoin’s role as “digital gold.”

That narrative hasn’t worked out well so far. In 2025, spot Ether ETFs in the US saw $42 million in net outflows. At the same time, Bitcoin ETFs brought in $8 billion across a dozen funds. Institutions seem more interested in returns and yield than Ethereum’s security pitch. Ethereum’s roadmap hasn’t been convincing enough to pull serious capital out of Bitcoin’s orbit.

At the same time, Michael Saylor’s firm MicroStrategy is going all-in on Bitcoin again. His company just announced it would sell $2.1 billion worth of 10% “perpetual strife” preferred stock to buy more Bitcoin. That kind of headline doesn’t help Ethereum’s case.

When one chain is pulling in billions through aggressive buying strategies, and the other is launching rebrands to chase institutional money that isn’t even arriving, the contrast is sharp.

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OKX launches xBTC on Sui while Bitcoin nears $109K ATH
Bitcoin

OKX launches xBTC on Sui while Bitcoin nears $109K ATH

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OKX’s launch of xBTC on Sui represents a strategic bet on Bitcoin-backed decentralized finance at a critical market inflection point, with Bitcoin hovering near $109K and institutional capital actively exploring on-chain yield opportunities. For institutional investors, the move signals that major centralized exchanges are willing to stake their reputation on Layer 1 alternatives to Ethereum, fundamentally reshaping how Bitcoin liquidity can be accessed and deployed in DeFi protocols.

  • OKX selected Sui as one of only three chains for xBTC’s debut launch, with native minting directly from the exchange and zero minting or redemption fees.
  • Bitcoin-backed assets now represent over 10% of Sui’s total value locked, with approximately 600 BTC flowing into the network since February.
  • Sui’s BTCfi ecosystem now hosts multiple major projects including Lombard, Babylon, and Stacks, positioning the chain as a primary infrastructure layer for Bitcoin DeFi.

OKX, one of the world’s largest cryptocurrency exchanges by trading volume, announced the launch of xBTC on the Sui blockchain as Bitcoin approaches its previous all-time high of $109,000. The new asset represents a direct bridge between centralized exchange infrastructure and decentralized finance, minted natively on OKX’s platform and withdrawable as a Sui-native token. The timing coincides with Bitcoin’s 21% surge over the past 30 days and reflects accelerating institutional adoption of Bitcoin-backed DeFi protocols. Sui was selected alongside only two other blockchains for the debut, underscoring the network’s emerging status as critical infrastructure for Bitcoin-denominated on-chain activity. The launch includes exclusive day-one integrations with protocols Cetus and Navi, providing initial liquidity pathways and yield opportunities for xBTC holders.

OKX’s Infrastructure Play: Bridging CeFi Security with DeFi Accessibility

The architectural design of xBTC addresses a longstanding friction point in Bitcoin DeFi adoption: the trust and custody models required to move Bitcoin on-chain. Traditional wrapped Bitcoin solutions like WBTC rely on third-party custodians and multi-signature arrangements, introducing counterparty risk and operational complexity. By minting xBTC directly from OKX’s exchange infrastructure, the asset leverages the exchange’s institutional-grade security and operational standards while eliminating additional intermediaries. Users can withdraw xBTC as a native Sui asset without relying on bridge protocols, canonical wrappers, or external custody solutions. Jason Lau, OKX’s Chief Innovation Officer, emphasized this positioning: “Our unique advantage as one of the most trustworthy and transparent institutions imbues xBTC with a powerful security model.” The economic incentive structure reinforces adoption: xBTC charges zero fees for minting or redemption, with only minimal gas costs on Sui for transactions and interactions.

This fee structure differs materially from competing Bitcoin-backed assets. WBTC, the largest wrapped Bitcoin token by adoption, charges annual fees and relies on delegated custody through Coinbase. Lombard Finance and other newer entrants offer different economic and security models, but none combine exchange-native issuance with zero-fee on-chain availability. For institutional investors managing Bitcoin allocations, the elimination of minting fees creates a direct arbitrage advantage when Bitcoin spot premiums or DeFi yield opportunities exceed transaction costs. The competitive positioning also signals OKX’s confidence in Sui’s technical durability and ecosystem maturity. Launching only on three chains simultaneously represents a deliberate constraint, suggesting OKX is prioritizing network-specific optimization over maximum distribution.

Sui’s BTCfi Infrastructure Reaching Critical Mass

Sui has accumulated approximately 600 BTC since February, representing roughly $26 billion at current spot prices. Bitcoin-backed assets now comprise over 10% of Sui’s total value locked, a remarkable concentration for a Layer 1 blockchain that only achieved meaningful adoption in 2023. This accumulation reflects institutional Bitcoin holders’ active migration from Ethereum and other established chains to access Sui’s throughput advantages and lower transaction costs. The network’s combination of high transaction finality (one to two seconds) and sub-cent gas fees creates structural advantages for frequent position rebalancing and yield farming—key behaviors in Bitcoin DeFi.

The ecosystem supporting Bitcoin DeFi on Sui extends far beyond OKX’s xBTC launch. Stacks brings Proof of Work settlement, Lombard offers liquid staking derivatives, Babylon provides Bitcoin staking infrastructure, and RedStone supplies oracle services. This density of Bitcoin-focused infrastructure in a single blockchain environment has created what Christian Thompson, Managing Director at the Sui Foundation, described as evidence of “complete product-market fit in a matter of months.” The ecosystem approach contrasts with Ethereum’s more fragmented Bitcoin DeFi landscape, where major protocols operate across multiple rollups and sidechains. For institutional investors seeking concentrated Bitcoin DeFi exposure, Sui’s unified ecosystem reduces operational complexity and counterparty surface area.

Market Implications and Institutional Capital Flows

The xBTC launch arrives during a critical moment for Bitcoin price discovery. Bitcoin’s 21% monthly gain and proximity to its $109,000 all-time high indicate renewed institutional and retail demand, driven partly by spot Bitcoin ETF inflows and macroeconomic considerations. However, the Fear and Greed Index reading of “Greed” sentiment suggests current prices may incorporate speculative positioning. Within this volatility backdrop, Bitcoin DeFi products provide alternative value capture mechanisms beyond simple price appreciation—specifically, through yield generation on borrowed Bitcoin, liquidation opportunities on over-collateralized positions, and trading fees within decentralized markets.

OKX’s commitment to Sui signals confidence that Layer 1 alternatives can sustain institutional-grade infrastructure and liquidity depth. The exchange’s decision to mint xBTC natively rather than deploying on Ethereum or multiple chains simultaneously suggests a strategic bet that Sui’s throughput and cost structure will attract sufficient capital to justify concentration. For institutional investors managing Bitcoin positions, xBTC provides a new mechanism to access DeFi yield without maintaining custody of private keys or relying on third-party custodians like major institutional staking providers. The zero-fee structure creates meaningful arbitrage dynamics when yield exceeds gas costs—potentially driving sustained demand.

The competitive landscape for Bitcoin-backed assets will likely intensify as other major exchanges evaluate similar launches. However, OKX’s first-mover status on Sui, combined with Cetus and Navi’s exclusive day-one partnerships, establishes xBTC as the primary liquidity hub for Bitcoin DeFi on the network. Institutional investors monitoring Bitcoin DeFi growth should track xBTC’s TVL accumulation, yield rates across Cetus and Navi pools, and whether OKX expands xBTC to additional chains. The launch validates a broader thesis: institutional-grade Bitcoin DeFi infrastructure requires both exchange-native security and blockchain-native scalability. Sui’s accumulation of over 600 BTC and xBTC’s positioning suggest this thesis is moving from theory to operational reality.

White House crypto czar says stablecoin bill will unlock trillions for US treasury
Blockchain

White House crypto czar says stablecoin bill will unlock trillions for US treasury

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The White House’s top crypto advisor has claimed that federal stablecoin legislation could generate trillions in Treasury demand, positioning the measure as both economic policy and a potential financial windfall for US government finances. The GENIUS Act has already cleared a critical Senate filibuster threshold, setting up a floor vote that could reshape how digital dollar tokens operate across US markets.

  • David Sacks predicts stablecoin bill could create “trillions of dollars of demand” for US Treasuries “practically overnight.”
  • GENIUS Act cleared 66-32 cloture vote in Senate, surpassing 60-vote filibuster threshold with 15 Democratic supporters.
  • Stablecoin issuers would be required to hold 100 percent reserves in cash or Treasury bonds, with pending House passage still needed.

The White House’s leading cryptocurrency official has made an ambitious economic claim about pending stablecoin legislation, arguing that federal regulatory clarity could channel trillions of dollars into US Treasury holdings. David Sacks, President Donald Trump’s chief advisor on crypto and artificial intelligence policy, stated during a Wednesday interview that the proposed GENIUS Act could generate enormous demand for Treasury instruments by providing legal certainty for stablecoin issuers. “If we provide the legal clarity and legal framework for this, I think we could create trillions of dollars of demand for our Treasuries practically overnight, very quickly,” Sacks said. The legislation has already passed a significant procedural hurdle in the Senate, clearing a 66-32 cloture vote this week that exceeded the 60-vote threshold required to overcome a filibuster. Critically, 15 Democrats voted with Republicans on the measure, signaling unusual bipartisan alignment on a crypto policy question that has traditionally divided the parties along ideological lines.

GENIUS Act establishes mandatory 100-percent Treasury reserve backing for all stablecoins

The core mechanism of the GENIUS Act, formally titled the Guiding and Establishing National Innovation for US Stablecoins Act, would impose uniform federal standards on how stablecoin issuers maintain and manage reserves. Under the bill’s framework, stablecoin issuers must hold reserves that fully cover every token in circulation, with those reserves limited to easily accessible and safe assets such as cash or US Treasury bonds. This design is intended to guarantee that stablecoins remain stable in value and redeemable at par, addressing a foundational concern among regulators and institutional investors about whether digital dollar tokens can maintain their peg during market stress or operational disruptions.

Sacks framed the legislation as more than a regulatory measure, describing it instead as “a national economic strategy” aimed at strengthening the dollar’s dominance in internet-based financial systems. He argued that stablecoins provide a new settlement layer characterized by improved efficiency, lower costs, and real-time payment capabilities compared to traditional wire transfer and banking infrastructure. For institutional investors, the clarity matters significantly: a federal regulatory framework would remove substantial legal uncertainty that has previously hindered institutional adoption of stablecoins. Banks and asset managers have expressed interest in using stablecoins for treasury management and settlement, but have largely held back absent clear regulatory status.

The Treasury reserve requirement is particularly favorable to federal finances. By mandating that stablecoin collateral consist primarily of Treasury instruments rather than other asset classes, the legislation would effectively create a new and substantial buyer of government debt. Sacks’s claim that this could generate “trillions” reflects the scale of potential stablecoin circulation if the market reaches even a fraction of the maturity achieved by traditional payment systems or money market funds, which manage roughly $6 trillion in assets globally.

Trump family stablecoin USD1 stands to benefit directly from GENIUS Act framework

The advance of the GENIUS Act has generated significant controversy centered on potential conflicts of interest involving the Trump family’s direct financial stakes in the crypto industry. World Liberty Financial, a venture backed by Donald Trump Jr., has launched USD1, a stablecoin collateralized by precisely the asset class that the GENIUS Act would regulate and legitimize: US Treasuries and dollar deposits. This alignment has raised alarms among Democratic lawmakers and government ethics observers, who argue that the bill could function as a preferential regulatory gift to the President’s family business.

The controversy intensified earlier this month when Abu Dhabi-based investment fund MGX pledged significant capital into USD1, routing the investment through Binance, the world’s largest cryptocurrency exchange by trading volume. This investment represents the largest single capital infusion into the Trump-linked stablecoin to date, according to available reporting. Senator Elizabeth Warren and other Democratic critics have explicitly warned that the GENIUS Act could channel billions of dollars into the President’s and his family’s financial positions, creating what they characterize as an unprecedented conflict of interest. Warren and allied lawmakers have called for stronger ethical safeguards in the legislation designed to prevent elected officials from profiting personally from regulatory frameworks they shepherd into law.

Sacks has expressed confidence that the bill will advance further, yet he has declined to address direct questions about Trump’s financial ties to stablecoin ventures. His silence on the matter has not resolved the underlying ethical questions, which may resurface during House debate and floor votes. The conflict-of-interest question remains unresolved at the legislative level, and no amendments addressing Warren’s concerns have been publicly proposed or incorporated into the Senate version of the bill.

House passage remains uncertain as final floor vote timeline emerges

While the GENIUS Act has secured Senate passage through the procedural cloture vote, the bill has not yet been voted on by the full Senate chamber, and House passage remains dependent on future legislative scheduling and potential amendments. The 66-32 cloture vote indicates sufficient support to overcome a filibuster, but the actual Senate floor vote has not occurred. Institutional investors monitoring the measure should note that multiple legislative steps remain, and unexpected delays or substantive amendments could alter the bill’s final form. The House of Representatives has not yet scheduled floor debate, and committee review timelines are not publicly established.

The bipartisan nature of the cloture vote—with 15 Democrats joining all voting Republicans—suggests that significant portions of the Democratic caucus may be willing to support a stablecoin framework despite ethical objections raised by Warren and other progressive lawmakers. This split within the Democratic party could be decisive if House Democrats face internal pressure to advance or block the measure. Some Democrats may prioritize the economic benefits of regulatory clarity and Treasury demand over ethical concerns about Trump family involvement, while others may refuse to support legislation they view as a conflict of interest.

Institutional investors should monitor whether House Democrats introduce amendments designed to address the conflict-of-interest concerns raised by Warren, such as provisions preventing sitting government officials or their close family members from holding financial stakes in regulated stablecoin issuers. The absence of such safeguards in the current Senate version may prove contentious during House debate. Additionally, investors should track whether the Trump administration or stablecoin advocates provide further public statements clarifying how Treasury demand from stablecoin collateral could reach the “trillions” figure Sacks cited, or whether that projection is subject to revision based on actual market adoption rates.

VanEck debuts PurposeBuilt fund to invest in Avalanche-based applications
Blockchain

VanEck debuts PurposeBuilt fund to invest in Avalanche-based applications

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AI NewsMay 22, 2025·5 min read

VanEck is launching a dedicated private fund in June 2025 to invest exclusively in token projects and early-stage companies building on the Avalanche blockchain, marking a significant institutional bet on ecosystem-specific infrastructure beyond generalist crypto exposure. For institutional investors seeking focused exposure to a maturing blockchain network with real-world application development, this signals both VanEck’s confidence in Avalanche’s enterprise potential and a broader shift toward utility-driven token selection over speculative assets.

  • VanEck PurposeBuilt Fund will launch June 2025, exclusively investing in Avalanche-based token projects and venture-backed blockchain companies
  • Fund will be managed by the team behind VanEck’s Digital Assets Alpha Fund, which has deployed over $100 million in AUM since 2022
  • Focus areas include gaming, financial services, payments, and AI—with capital deployed at or near token generation events for liquid and early-stage projects
  • June 2025 Expected launch date for VanEck’s Avalanche-focused PurposeBuilt Fund investment vehicle
  • $100M+ Assets under management in VanEck Digital Assets Alpha Fund since its 2022 inception
  • $50B Current market capitalization of the Avalanche blockchain ecosystem

VanEck, one of the world’s largest asset managers, is launching the PurposeBuilt Fund to deploy capital into projects building real-world applications on the Avalanche blockchain. The fund, expected to launch in June 2025, will target companies issuing tokens on the Avalanche network, focusing on ventures with tangible use cases rather than speculative assets. Investments will span both liquid token positions and early-stage venture-backed projects in sectors including gaming, financial services, payments, and artificial intelligence, with most capital deployed at or shortly after token generation events.

VanEck’s digital assets team brings $100M track record to Avalanche-focused strategy

The PurposeBuilt Fund will be managed by the same team that oversees VanEck’s Digital Assets Alpha Fund, which has accumulated more than $100 million in assets under management since its 2022 launch. DAAF has established a reputation for investing in scalable liquid tokens tied to real-world products, providing institutional investors with a disciplined alternative to hype-driven crypto fund management. By assigning this experienced team to oversee Avalanche-specific investments, VanEck is signaling confidence both in its portfolio managers’ ability to identify quality projects and in Avalanche’s maturation as an ecosystem.

Avalanche has emerged as one of the most active blockchain networks globally, with a current market valuation near $50 billion and growing adoption across enterprise and decentralized applications. The network is recognized for technical attributes including high transaction speed and low on-chain costs—advantages that matter to developers building production systems rather than proof-of-concept projects. VanEck’s decision to create an Avalanche-specific fund, rather than continuing a generalist approach, reflects the network’s evolution from a competitive layer-1 candidate into a mature ecosystem capable of sustaining sector-focused capital allocation.

The timing of this announcement aligns with increased institutional interest in blockchain networks that have demonstrated real-world transaction volume and developer retention beyond cyclical market enthusiasm.

Token investments at launch prioritize projects with immediate utility over pre-revenue speculation

The fund’s investment thesis departs sharply from the typical venture crypto playbook. Rather than backing teams with whitepapers and roadmaps, PurposeBuilt will deploy capital into projects at or near their token generation events—the moment when tokens transition from private allocation to public trading. This approach assumes that serious projects will have demonstrable traction, user adoption metrics, or revenue-generating capability by launch, allowing investors to evaluate projects on fundamental business metrics rather than speculative potential.

Pranav Kanade, portfolio manager at VanEck Digital Assets, framed the fund’s conviction in concrete terms: “The next wave of value in crypto will come from real businesses, not more infrastructure.” This statement reflects a deliberate pivot away from capital allocation toward blockchain infrastructure layers themselves—a positioning that dominated venture crypto funding from 2017 through 2021. Instead, PurposeBuilt targets application-layer companies in fintech, tokenized real-world assets, and AI, where token value derives from network usage and revenue-sharing mechanisms rather than technical necessity.

The next wave of value in crypto will come from real businesses, not more infrastructure.

Pranav Kanade, Portfolio Manager, VanEck Digital Assets

The fund plans to maintain liquidity by directing capital into Avalanche-native real-world asset products, such as tokenized money market funds, that generate yield while supporting on-chain economic activity. This approach allows the fund to remain positioned for capital redeployment into new opportunities rather than illiquid long-term holdings, a critical operational requirement for institutional fund management.

Patient capital strategy addresses funding gap for quality developers competing with meme-coin narrative

One implicit thesis underlying PurposeBuilt is that the cryptocurrency market systematically underallocates capital to developers building genuine applications because market attention concentrates on speculative assets and short-term momentum plays. Developers working on fintech infrastructure, payment rails, or AI integration receive less media coverage and retail investment interest than teams launching tokens with built-in hype mechanisms or celebrity endorsements, even when the latter lack sustainable economics.

VanEck’s fund is designed to provide an alternative capital source with an explicit long-term horizon, allowing founders to prioritize product development over quarterly token price performance.

This positioning reflects broader institutional recognition that previous cryptocurrency cycles produced waves of infrastructure that never achieved meaningful adoption. By contrast, projects selected by experienced managers with skin in the game—measured by track records like DAAF’s $100 million AUM—have a higher probability of attracting follow-on capital, developer talent, and user adoption. The fund offers both financial resources and the implicit signal value of VanEck’s institutional brand, which carries weight in enterprise and traditional finance conversations.

Institutional investors watching Avalanche and the broader Layer-1 ecosystem should monitor the PurposeBuilt Fund’s investment announcements beginning in June 2025, as they will serve as real-time signals of which application categories and teams a top-tier asset manager believes warrant patient capital in the current market cycle.

VanEck’s Ecosystem Bet Reflects Institutional Shift Away From Generalist Crypto Exposure

VanEck’s decision to launch a dedicated single-blockchain fund represents a notable strategic divergence from the industry’s five-year pattern of generalist crypto exposure. Between 2020 and 2024, institutional crypto allocations overwhelmingly flowed into diversified products tracking broad market indices or multi-chain portfolios, with firms like Grayscale and Fidelity building scale through exposure to Bitcoin, Ethereum, and uncorrelated assets. The PurposeBuilt Fund’s vertical focus signals that institutional investors have begun viewing mature Layer-1 networks as sufficiently differentiated to merit dedicated capital allocation, similar to how traditional venture capital manages sector-specific or geography-specific funds.

Avalanche’s $50 billion current market capitalization sits below Ethereum’s $2+ trillion but substantially above emerging Layer-1 networks, positioning it as a proven infrastructure layer rather than speculative emergence. VanEck’s choice to anchor institutional capital here rather than to newer chains reflects institutional risk tolerance increasingly calibrated toward networks with demonstrated developer retention and transaction throughput. The fund structure—deploying capital at token generation events rather than on open markets—also indicates VanEck’s confidence that Avalanche-native projects will command premium valuations post-launch, justifying early-stage entry points.

The fund’s June 2025 launch will test whether other Tier-1 asset managers follow with similar ecosystem-specific vehicles. Competitors including Fidelity, Blackstone, and Invesco have not yet announced comparable single-chain institutional funds, leaving open whether VanEck’s move reflects a broader trend or a calculated bet on Avalanche’s specific regulatory and technical trajectory over the next 18 months.

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