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On Thursday, Consensys sued the U.S. Securities and Exchange Commission (SEC) in a Texas federal court, seeking to prevent an impending SEC action against its MetaMask wallet and to clarify that ether is not a security.

The complaint calls out the agency for what Consensys describes as “regulatory overreach,” challenges its notion that ETH is a security, and says the SEC has violated the Constitutional requirement of fair notice under the due process clause. It notes that for years, the SEC and its sister agency, the Commodity Futures Trading Commission, took the position that ETH is not a security.  

The lawsuit also challenges the SEC’s recent focus on Ethereum's switch to proof of stake in 2022 as a basis for increased scrutiny, a stance Consensys CEO Joseph Lubin deemed "preposterous."

Laura Brookover, Senior Counsel & Head of Litigation and Investigations at ConsenSys, joined Unchained to unpack the lawsuit and what it means for the future of Ethereum and overall crypto in the US.

Show highlights:

• Why Consensys sued the SEC and why Brookover feels like the SEC has gone too far
• How they are looking for a Judge to declare that the ETH is not a security
• Whether the switch to proof of stake turned ETH into a security
• Why the SEC issued Consensys a Wells Notice, with one potential allegation being that it is operating an unregistered securities broker through its MetaMask wallet
• How the major questions doctrine applies to what the SEC is doing in the industry, according to Brookover
• Why Hinman’s speech is still relevant today, even after 6 years
• Whether the moves by the SEC are related to a motivation to deny ether spot ETFs
• How the several cases against the SEC show that the industry “has had enough”
• Whether Texas is a jurisdiction favorable to crypto, given that many lawsuits are being filed there
• The implications of a Consensys victory for the industry and what the next steps in the case are

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Guest

• Laura Brookover, Senior Counsel & Head of Litigation and Investigations at Consensys

Links

The lawsuit: 

• Fortune: SEC sued over Ethereum, crypto firm asks court to state token is not a security
• ConsenSys’s complaint
• Bill Hughes’ thread on why Consensys sued the SEC
• Consensys is suing the SEC to defend the Ethereum ecosystem

Hinman speech

• CryptoLaw: The Hinman Speech Documents

Major questions doctrine

• Unchained: Why the SEC vs. Ripple Order Is Now About 2 Things: Coinbase and Congress
• Reuters: SEC argues Coinbase crypto case not barred by ‘major questions’ doctrine 

Other SEC cases:

• Coinbase
• Unchained: 
• Why the SEC’s Case Against Coinbase Is So Significant for Crypto
• Court Rejects Coinbase’s Bid to Dismiss SEC Charges Against It
• Uniswap
• Unchained: 
• Gary Gensler’s Case Against Uniswap: Does the SEC Even Stand a Chance?
• SEC Puts DeFi in Its Sights With Potential Uniswap Suit
• Uniswap Blog Post on the Wells notice
• Marvin Ammori Thread on Wells notice
• Ethereum Foundation
• Unchained:
• SEC Investigating Ethereum Foundation Regarding Proof-of-Stake Transition: Report
• The Real Reason Why the SEC Might Be Going After Ethereum
• Debt Box
• Unchained: SEC Sanctioned for ‘Abuse of Power’ in Debt Box Lawsuit
• Beba
• DeFi Education Fund and Beba sue SEC over airdrop policies
• Lejilex
• Lawsuit document

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Welcome to The Chopping Block, where Haseeb Qureshi, Tom Schmidt, Tarun Chitra, and Robert Leshner dissect the crypto world’s topics of the day. In this episode, we delve into the SEC's recent scrutiny of Uniswap, exploring the potential legal and regulatory impacts on the DeFi landscape. We also discuss the unprecedented flooding in Dubai and its effects on the recent crypto conference, highlighting the resilience of the crypto community in the face of natural disasters. Shifting our focus to Bitcoin, we analyze the implications of the latest halvening event and what it means for Bitcoin’s inflation rate and market dynamics. Through these discussions, we unpack the intricate relationships between regulatory actions, environmental challenges, and technological advancements in cryptocurrency. Join us as we navigate through these complex topics, offering deep insights and expert analysis on the events that are shaping the future of blockchain and digital currencies. Tune in to understand how these pivotal moments are influencing the strategic direction and ethical considerations within the crypto space.

Listen to the episode on Apple Podcasts, Spotify, Overcast, Podcast Addict, Pocket Casts, Pandora, Castbox, Google Podcasts, TuneIn, Amazon Music, or on your favorite podcast platform.

Show Highlights

🔹The devastating floods in Dubai and their impact on the Token 2049 conference

🔹 Analysis of Bitcoin's halvening event, exploring whether it's a bullish signal or just market noise.

🔹 Examine the evolution and market impact of new Bitcoin protocols like ordinals and runes, assessing their effectiveness and reception within the community.

🔹 Explore the dynamics of the Asian market's influence on Bitcoin's secondary layers, discussing the integration of substantial Bitcoin deposits and yield strategies.

🔹 Dive into the SEC's Wells Notice to Uniswap and its broader implications for decentralized finance (DeFi).

Hosts

⭐️Haseeb Qureshi, Managing Partner at Dragonfly 

⭐️Tom Schmidt, General Partner at Dragonfly 

⭐️Robert Leshner, Founder of Compound

⭐️Tarun Chitra, Founder and CEO of Gauntlet

Disclosures

Links

Fighting for DeFi by Uniswap: https://blog.uniswap.org/fighting-for-defi 

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Jake Chervinsky, chief legal officer of Variant, discusses the current state of crypto regulation, touching on several ongoing legal and regulatory issues in the crypto space, including Uniswap’s Wells notice, the Coinbase case, the Tornado Cash case, the Ethereum Foundation investigation and more. Chervinsky argues that the government's approach to these cases is often misguided, particularly in instances where they hold software developers liable for how third parties use their software. He also discusses the potential implications of the government's case against Tornado Cash, suggesting that it could have far-reaching consequences for all open-source software developers. 

Chervinsky also delves into the SEC's ongoing investigations into the Ethereum Foundation, as well as the recent IRS draft form that lists unhosted wallets as a type of broker. He expressed concern about the potential impact of these investigations on the crypto industry, but remained optimistic about the future of DeFi in the US.

Show highlights:

• How the Tornado Cash case could set a critical precedent for open-source software
• How the government’s Tornado indictment reveals a fear of unsurveilled financial systems, according to Jake
• What the implications of the Tornado Cash case could be for the broader DeFi space
• What lessons can be learned from the $62 million hack of Munchables on Blast
• How to address the challenge of malicious actors like North Korea using a permissionless system
• Whether Coinbase's staking services are considered a securities offering
• Whether Judge Failla’s ruling on Coinbase acting as a broker could be overturned
• Why Jake thinks the SEC will face significant challenges in its potential case against Uniswap Labs
• How the Debt Box case order impacts the SEC’s reputation, according to Jake
• How the industry is pushing back against the SEC’s regulation by enforcement with its own lawsuits for Lejilex and Beba
• The future of DeFi in the U.S. and its potential for success, according to Jake
• Why Jake believes the SEC will deny Ether ETFs and why he disagrees with the latest stablecoin regulation bill by Lummis and Gillibrand
• How the U.S. Presidential election could impact the future of the crypto industry

Thank you to our sponsors!

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Guest:

• Jake Chervinsky, Chief Legal Officer at Variant
• Previous appearances on Unchained:
• Why the SEC vs. Ripple Order Is Now About 2 Things: Coinbase and Congress
• The Chopping Block: Jake Chervinsky on How the SEC Has Lost Credibility
• All Things Crypto Regulation With Jake Chervinsky
• Everything You Need to Know About the Looming Battle Over Privacy in Crypto
• Can Crypto Be a Force in the Midterms? Yes, Say Kristin Smith and Jake Chervinsky

Links

Tornado Cash

• Jake’s amicus brief with Amanda Tuminelli
• Unchained: Given the Sanctions on Tornado Cash, Is Ethereum Censorship Resistant?
• Unchained: Is This the End of DeFi? Why the US Government Is Going After Tornado Cash

Munchables exploit

• Unchained: Blast-Based NFT Game Munchables Recovers $62.5 Million Lost in Exploit

SEC cases:

• Coinbase
• Unchained: 
• Why the SEC’s Case Against Coinbase Is So Significant for Crypto
• Court Rejects Coinbase’s Bid to Dismiss SEC Charges Against It
• Uniswap
• Unchained: 
• Gary Gensler’s Case Against Uniswap: Does the SEC Even Stand a Chance?
• SEC Puts DeFi in Its Sights With Potential Uniswap Suit
• Uniswap Blog Post on the Wells notice
• Marvin Ammori Thread on Wells notice
• Ethereum Foundation
• Unchained:
• SEC Investigating Ethereum Foundation Regarding Proof-of-Stake Transition: Report
• The Real Reason Why the SEC Might Be Going After Ethereum
• Debt Box
• Unchained: SEC Sanctioned for ‘Abuse of Power’ in Debt Box Lawsuit
• Beba
• DeFi Education Fund and Beba sue SEC over airdrop policies
• Lejilex
• Lawsuit document

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Not only will April 20 (or 19, depending on which part of the world you are) mark the fourth Bitcoin halving, but also the launch of a new primitive on Bitcoin called Runes Protocol. 

Charlie Spears, co-founder of Blockspace Media, joined Unchained to talk about all things Runes, which is a messaging protocol that allows for the creation of fungible tokens on Bitcoin. It is designed to fix some of the issues with the BRC-20 token standard, such as inefficiency and proliferation of unspent transaction outputs. Charlie believes that the launch of Runes will increase demand for Bitcoin's blockspace and potentially lead to higher transaction fees. He also discusses the potential for Runes to interact with Bitcoin covenants and layer two solutions.

Show highlights:

• What Runes is and why Charlie believes that it is the hottest thing since Ordinals
• The differences between Runes and BRC-20 fungible tokens 
• Runes’ unique features, with Charlie pointing out that this is “what the degens really want”
• Whether the Runes Protocol will create a “burst of demand” and have a positive impact on miners 
• Whether the launch of Runes will be successful in the long-term and how Bitcoin’s blockspace could become more attractive
• Whether Bitcoin L2s will help clear Bitcoin’s mempool, and why Charlie believes that they won’t reduce fee pressure on the base layer
• The coolest things that Runes Protocol will enable, according to Charlie
• How Taproot Assets and RGB differ from Runes and why they have not taken off
• Why Casey, the founder of Runes, will claim the first inscription with Uncommon Goods

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Guest

• Charlie Spears, cofounder of Blockspace Media

Links

• Recent coverage on Unchained of the Bitcoin halving: Arthur Hayes and Will Clemente on How This Bitcoin Halving Is Different

Runes

• Unchained: What Are Runes? A Guide to the New Fungible Token Protocol on Bitcoin
• Bitcoin Runes Explainer by Charlie Spears

BRC-20s and Ordinals:

• Unchained:
• What Are BRC-20 Tokens? A Brief Introduction
• Bitcoin’s BRC-20 Mania: Is It Sustainable?
• How to Create a Bitcoin Ordinal
• Bitcoin Ordinal NFTs Are Hot and Getting Hotter. What's the Hype About? 

Halving

• Unchained: 
• Bitcoin Halving: What Is It & How Is It Determined?
• Here’s Why No One Agrees Exactly When The Bitcoin Halving Will Happen
• Bitcoin Miners Diversify Their Revenue Streams as Halving Nears

Bitcoin L2s

• Unchained: 
• Stacks’ Muneeb Ali On Why Bitcoin Is Exciting Once Again
• Citrea: An Ethereum-Like Experience Built on Bitcoin?
• How Botanix Aims to Enable Smart Contracts on Bitcoin

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The Bitcoin halving is just around the corner, expected to be on April 19 or April 20. 

Arthur Hayes, CIO of Maelstrom, and Will Clemente, co-founder of Reflexivity Research discuss the rise in Bitcoin prices ahead of the halving, the impact of the approval of spot Bitcoin ETFs in the US, and the potential effects of the halving on the price trajectory post-halving. They also discuss the potential impact of a new class of investors on Bitcoin's price, volatility, and decentralization. 

Learn more: Bitcoin Halving: What Is It & How Is It Determined?

Moreover, they dive into the impact of the macroeconomics, geopolitical, and demographic conditions for the crypto asset industry, the potential for L2s on Bitcoin, and their price predictions for bitcoin by year-end. 

Show highlights:

• How the approval of spot Bitcoin ETFs altered the price trajectory of BTC before the halving
• Whether the introduction of spot Bitcoin ETFs impacts Bitcoin's decentralization and price volatility
• Whether this cycle could be the "last cycle" or the "supercycle"
• Why Arthur predicts a 90% drawdown in the future and how they determine when the markets are nearing the top of the cycle
• The effect of high inflation, the election, and the termination of the bank term funding program on Bitcoin
• How artificial intelligence is expected to trigger a productivity boom, according to Will
• Why Will considers Coinbase to be mispriced
• Whether Bitcoin L2s have a future and if security budgets are a concern
• Their views on Bitcoin Ordinals and the Runes Protocol launch
• Why Will views DOGE as a purer commodity than ETH
• Arthur's rebuttal to claims that Ethena could follow in Terra/Luna’s footsteps
• Arthur's and Will’s Bitcoin price projections for the end of the year and the cycle

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Guest:

• Arthur Hayes, CIO of Maelstrom.
• Previous appearances on Unchained:
• Arthur Hayes on Why Bitcoin Is Money and ETH Is a Shitcoin He Loves
• Arthur Hayes, Former Ethereum Skeptic, on Why the Merge Makes Him Bullish on ETH 
• Arthur Hayes of Bitmex on Why Countries Will Turn to Digital
• The Chopping Block: Arthur Hayes on Why Crypto Needs to Ditch the Banks
• How Crypto and Blockchain Technology Could Change Financial Services
• Will Clemente, Co-founder of Reflexivity Research
• Previous appearance on Unchained: Strong Hands Aren't Selling Bitcoin. So Who Is? 

Links

This cycle

• Naval’s tweet: “The narrative for this cycle is ‘this is the last cycle.’”
• Unchained: 
• Here’s Why No One Agrees Exactly When The Bitcoin Halving Will Happen
• Bitcoin Miners Diversify Their Revenue Streams as Halving Nears
• Heatwave by Arthur Hayes
• Dissecting Bitcoin's “4 Year Cycle,” guest post by Will Clemente on The Pomp Letter

Bitcoin ETFs:

• Unchained: 
• The Best Spot Bitcoin ETFs for Different Types of Investors
• Who Is Buying Into Spot Bitcoin ETFs? We'll Soon Start to Get an Idea
• Bitcoin ETFs Explained: What Are They & How Do They Work? 

Macroeconomic conditions

• CNBC: Consumer prices rose 3.5% from a year ago in March, more than expected
• FT: Investors lose hope of rapid US interest rate cuts this year

Block size wars

• Bloomberg: The Block War Is Still a Sore Subject for ‘Bitcoin Jesus’ 

Bitcoin L2s

• Unchained: Stacks’ Muneeb Ali On Why Bitcoin Is Exciting Once Again 

Runes

• Decrypt: Bitcoin Runes Launch at the Halving: Here's Everything You Need to Know

Ethena

• Hayes’ tweet on Ethena
• Unchained: 
• ENA Surges 20% to New All-Time High as Ethena Rolls Out Reward Boosts
• Ethena’s USDe Grew to $2 Billion in 7 Weeks. Is It Safe?
• What Is Ethena's USDe Synethic Dollar?

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On Wednesday, the U.S. Securities and Exchange Commission (SEC) issued a Wells notice to Uniswap Labs, the team behind the prominent decentralized exchange (DEX) Uniswap, signaling a forthcoming enforcement action.

Amanda Tuminelli, Chief Legal Officer at the DeFi Education Fund, joined Unchained to unpack what the case could mean for Uniswap and the overall decentralized finance (DeFi) industry.

Amanda also talks about the DeFi Education Fund's recent lawsuit against the SEC over its airdrop policies and the industry’s need for a proactive counteroffensive approach in dealing with the SEC.

Show highlights:

• Why Amanda thinks that the SEC is going to take a “kitchen sink approach” to their charges
• How the SEC could make a case that some of the tokens traded via Uniswap are securities
• What the next steps are in the case, with a lawsuit possibly coming soon
• Whether there’s an inconsistency between the SEC’s position and Judge Failla’s rejection of the motion to dismiss the Coinbase lawsuit
• How the different components of Uniswap make it hard to prove that Uniswap Labs is responsible for everything that happens on the protocol
• Why the DeFi Education Fund recently filed a lawsuit against the SEC
• Why Amanda believes in a “proactive counteroffensive strategy” with the SEC
• How Amanda would like legislation to be implemented in the U.S.
• Why the Tornado Cash developers are not liable for the actions of third parties such as North Korean hackers, according to Amanda
• Why Amanda thinks Uniswap will ultimately win against the SEC

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• Polkadot

Guest

• Amanda Tuminelli, Chief Legal Officer at DeFi Education Fund
• Previous appearance on Unchained: Is This the End of DeFi? Why the US Government Is Going After Tornado Cash
• You’ve got a friend in me: How amicus briefs are helping the crypto industry win over the courts, Amanda’s op-ed for Fortune

Links

Wells Notice

• Unchained: SEC Puts DeFi in Its Sights With Potential Uniswap Suit
• Unchained: UNI Drops 16% as SEC Targets Uniswap Labs
• Uniswap Blog Post on the Wells notice
• Marvin Ammori Thread on Wells notice

Other cases:

• Fortune: Don't blame Uniswap for crypto scams, judge rules—and she's right
• The Block: Three crypto advocacy groups file amicus briefs in Tornado Cash developer Roman Storm's case
• The DeFiant: SEC Faces Lawsuit Seeking To Exempt Airdrops From Securities Classification
• Unchained: Court Rejects Coinbase's Bid to Dismiss SEC Charges Against It

Social media commentary:

• Paul Grewal’s tweet on the potential inconsistencies with the Coinbase case.
• Gabriel Shapiro’s tweet on how Uniswap AMM smart contracts are not run by the Uniswap company

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Welcome to The Chopping Block, where Haseeb Qureshi, Tom Schmidt, and Robert Leshner dive into the crypto universe's hottest topics. In this episode, we have the CEO/Co-Founder of Monad to explore the fascinating world of Monad and its ambitious endeavor to revolutionize EVM scalability through innovative parallelization techniques. The discussion shifts gears to the recent turmoil in Solana, dissecting the network's congestion issues and the broader implications for blockchain efficiency and scalability challenges. As the conversation deepens, we pivot to the gripping courtroom drama surrounding Avi Eisenberg, challenging the foundational crypto principle of 'code is law' and sparking debate over the legality of smart contract exploitation. Through these discussions, we untangle the complex interplay between technological innovation, regulatory frameworks, and the ethical considerations that define the crypto industry. Join us as we navigate the intricate dynamics shaping the future of blockchain technology, providing insightful analysis on the strategic developments and moral dilemmas at the heart of the digital age. Tune in for a compelling journey through the strategic and ethical battlegrounds that are forging the path forward for crypto and blockchain.

Listen to the episode on Apple Podcasts, Spotify, Overcast, Podcast Addict, Pocket Casts, Pandora, Castbox, Google Podcasts, TuneIn, Amazon Music, or on your favorite podcast platform.

Show Highlights

🔹 Dive into Monad’s efforts to revolutionize Ethereum with parallelization for higher transaction throughput and efficiency.

🔹 Discussion on Solana's congestion issue, its impact on network performance, and lessons for future scalability.

🔹 Examination of Avi Eisenberg's courtroom saga, challenging the boundaries between legal systems and blockchain autonomy.

🔹 Insight into the scalability challenges facing blockchains and the innovative solutions proposed by new projects.

🔹 Analyzing the ethical considerations in exploiting blockchain vulnerabilities and the responsibility of the crypto community.

🔹 Debate on the future of smart contracts in light of legal challenges and the evolving concept of 'code is law'.

🔹 Perspectives on the balance between innovation and user protection in the rapidly evolving landscape of decentralized finance.

Special guest

⭐️ Keone Hon, Cofounder/CEO at Monad Labs 

Hosts

⭐️Haseeb Qureshi, Managing Partner at Dragonfly 

⭐️Tom Schmidt, General Partner at Dragonfly 

⭐️Robert Leshner, Founder of Compound

Disclosures

Links

The Mango Markets Attacker on Whether His 'Trade' Was Ethical or Not - Ep. 413

https://unchainedcrypto.com/podcast/the-mango-markets-attacker-on-whether-his-trade-was-ethical-or-not-ep-413/ 

Nickel Blowup Made a Lot of Trouble by Matt Levine

https://www.bloomberg.com/opinion/articles/2022-03-14/nickel-blowup-made-a-lot-of-trouble 

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Polygon Labs CEO Marc Boiron and co-founder Brendan Farmer discussed everything about the AggLayer, a decentralized protocol built by Polygon that enables fast, secure cross-chain interactions and allows different chains to use the same native bridge. This allows users to seamlessly move assets across chains in the AggLayer ecosystem. 

The AggLayer aims to unify blockspace so that it feels like a single chain, improving user experience. Boiron and Farmer also discussed the potential for Layer 2 solutions to scale Ethereum, the benefits of zero-knowledge technology, and the future of Polygon's proof-of-stake chain.

Learn more: What Are Zero-Knowledge Proofs?

Show highlights:

• Background of Brendan and Marc and how they joined Polygon
• A brief description of what Polygon is overall
• What the AggLayer is and how it aims to enable the best of monolithic and modular blockchains
• How Brendan differentiates the AggLayer from its competitors, such as Optimism's Superchain or Cosmos and why he believes that zk-technology is such a game changer
• How the interoperability experience gets better in such a system, according to Marc and Brendan, and what will become possible that's not now
• Which chains can use the AggLayer and how it works to improve security across chains
• The tradeoffs between the various types of zkEVM provers 
• How projects should decide their architecture and when it would make sense to tap the AggLayer
• Why projects should build on the AggLayer, including layer 1s, according to Marc
• How Layer 1s can still join the AggLayer and retain their own consensus and sovereignty 
• Why Polygon believes that zk-technology is the future of blockchain architecture
• Why the Polgyon zkEVM suffered an outage on March 30
• Whether Layer 3s are needed to scale the Ethereum ecosystem
• Why Brendan believes that EigenLayer is not a good fit for rollups to use
• The transition of the Polygon PoS chain to become an Ethereum L2 using the AggLayer
• When EIP-4844/Dencun will go live on Polygon

Thank you to our sponsors!

• Polkadot

Guests:

• Marc Boiron, CEO of Polygon Labs
• Previous appearances on Unchained:
• Gary Gensler vs. Crypto: What Will the SEC Attack Next?
• The Chopping Block: The SEC Is Attacking Crypto – Will Gary Gensler Succeed?
• Brendan Farmer, co-founder of Polygon and co-lead of Polygon Zero

Links

AggLayer

• Polygon: Aggregated Blockchains: A New Thesis
• More technical Agglayer explainer
• CoinDesk: 
• Polygon Lands Astar Network as First User of New 'AggLayer’
• Cosmos-Based Canto Blockchain Reverses Course on Polygon Layer-2 Plans, Unveils New Roadmap 
• Zaki on the comparisons with Cosmos

zk-Technology

• Polygon: Upgrading Every EVM Chain to ZK: Introducing the Type 1 Prover
• The different types of ZK-EVMs by Vitalik
• Unchained: Why Zero-Knowledge Proofs Are Critical to Ethereum’s Future

Polygon zkEVM

• Unchained: Polygon zkEVM Chain Goes Down for 10 Hours
• Blockworks: Polygon unpacks zkEVM outage and ‘emergency’ upgrade

Layer 3s

• Unchained: Layer 3s Only Exist to Take Value Away From Ethereum: Polygon Labs CEO
• 0xCygaar on L3s and L2s
• Potuz on the benefit of L3s

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This week, Ethena was in the spotlight after the airdrop of ENA, its new governance token. Ethena’s flagship product, the “synthetic dollar” USDe has amassed a $2 billion market cap in less than two months. Meanwhile, ENA’s market capitalization sits around $1.4 billion, with a fully diluted valuation of $15.5 billion. 

In this episode, Guy Young, founder of Ethena Labs, discusses the risks associated with Ethena, including custodial risks and counterparty risks to exchanges. Young also talks about the use cases of Ethena's governance token, and discusses the potential for Ethena to be integrated with DeFi and CeFi.

Show highlights:

• An introduction to what Ethena is and how USDe works
• Why the team doesn't want to refer to USDe as a stablecoin, and prefers to use the term "synthetic dollar"
• What the risks of USDe are, including custody, counterparties, and smart contracts
• Why Guy is "pleased" with how the ENA airdrop went through
• How ENA will be used and what its role will be in the governance of Ethena
• Why Ethena is now onboarding Bitcoin as collateral
• Why Guy thinks that there's been an "exaggeration" regarding the situation with Maker and Aave
• Guy's response to the critics who say that Ethena is essentially Terra/Luna
• Whether USDe would only work in a bull market
• How the Ethena insurance fund works and what it aims to accomplish
• What's next for Ethena after onboarding Bitcoin, with Solana potentially being the next asset

Thank you to our sponsors!

• Polkadot
• iTrustCapital

Guest

• Guy Young, founder of Ethena Labs. 
• Previous appearance on Unchained: How Ethena's USDe Challenges Traditional Stablecoin Models

Links

Ethena: 

• Unchained: What Is Ethena’s USDe Synethic Dollar? A Beginner’s Guide
• Decrypt: Ethena Just Launched to a $1.2 Billion Market Cap: Here’s What You Need to Know 
• Dust on Crust by Arthur Hayes

Airdrop:

• Unchained: Airdrops From Wormhole and Ethena Labs Set to Inject $2.4 Billion Into Crypto Market This Week 
• Cointelegraph: Ethena will become highest revenue-generating crypto project — Delphi Labs CEO
• ENA Airdrop and Season 2: Sats Campaign 
• Learn more: What Is a Crypto Airdrop? A Beginner’s Guide

MakerDAO/Aave controversy: 

• The Block: MakerDAO proposes allocating $600 million worth of DAI into USDe and sUSDe
• The Defiant: DeFi Projects Clash After MakerDAO Adds Ethena’s USDe As Collateral, 

Comparisons to Terra’s UST: 

• The Defiant: Ethena Stablecoin’s 27% Yield is Triggering Terra-Induced PTSD
• Andre Cronje’s thoughts on USDe
• Cointelegraph: Ethena Labs founder clarifies USDe stability amid high yield worries

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Welcome to The Chopping Block, where Haseeb Qureshi, Tom Schmidt, Tarun Chitra, and Robert Leshner dive into the crypto universe's hottest topics. In this episode, amidst the crypto bull market's fervor, the boys dissect the launch of Ethena and its repercussions, including a potential DeFi civil war spurred by integration disputes between MakerDAO and AAVE. The conversation then shifts to the broader implications of SBF's sentencing, exploring how this landmark legal decision could reshape the landscape of trust and regulation within the crypto community. Moreover, we tackle the ethical and operational dilemmas faced by Blast in response to a significant hack, debating the merits and risks of potential rollbacks and the preservation of user funds against the backdrop of decentralized ideals. As we navigate through these complex issues, we shed light on the dynamics between decentralization, regulation, and innovation, offering nuanced perspectives on the challenges and opportunities that lie ahead for crypto. Tune in for an insightful journey through the strategic battlegrounds and evolutions that are defining the future of blockchain technology.

Listen to the episode on Apple Podcasts, Spotify, Overcast, Podcast Addict, Pocket Casts, Pandora, Castbox, Google Podcasts, TuneIn, Amazon Music, or on your favorite podcast platform.

Show Highlights

🔹 Analysis of Ethena's token launch impact on the crypto bull market and the crypto ecosystem

🔹Insight into the ongoing DeFi civil war triggered by MakerDAO's integration of Ethena, extending into Aave's strategic response and the broader DeFi ecosystem.

🔹Examination of SBF's sentencing, exploring its repercussions for crypto regulation, investor trust, and the legal landscape of the crypto industry.

🔹Evaluation of Blast's response to a significant security breach, debating the implications of potential rollbacks for DeFi security and user trust.

🔹Exploration of the balance between DeFi innovation, regulatory challenges, and the need for a stable legal framework to support crypto growth.

🔹Analysis of the crypto community's response to the DeFi civil war, SBF's sentencing, and security issues in decentralized finance platforms.

Hosts

⭐️Haseeb Qureshi, Managing Partner at Dragonfly 

⭐️Tom Schmidt, General Partner at Dragonfly 

⭐️Tarun Chitra, Managing Partner at Robot Ventures

⭐️Robert Leshner, Founder of Compound

Disclosures

Links

MakerDAO Proposal: “Morpho Spark DAI Vault Update” - https://forum.makerdao.com/t/morpho-spark-dai-vault-update-1-april-2024/24006 

AAVE’s Proposal: “Risk Parameters for DAI Update”

https://governance.aave.com/t/arfc-risk-parameters-for-dai-update/17211 

Barbara Fried’s SBF sentencing submission

https://storage.courtlistener.com/recap/gov.uscourts.nysd.590939/gov.uscourts.nysd.590939.419.0_1.pdf 

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On March 20, Fortune reported that the SEC was investigating the Ethereum Foundation and was looking for legal ways to label ETH as a security.

Sam Enzer, partner at Cahill Gordon & Reindel, and Greg Strong, partner at DLx Law joined Laura to discuss everything about the investigation and its implications.  

The guests speculate about the hidden motivations behind the SEC's investigation and discuss the likelihood of the approval of spot Ether ETFs. They also discuss the recent ruling in the SEC vs Coinbase case, where the judge dismissed claims that Coinbase's wallet was acting as an unregistered brokerage, but allowed the rest of the suit to proceed. 

Lastly, they touch on the devastating impact on the crypto industry if the SEC were to win a case alleging ETH is a security and what they are looking out for in the next couple of weeks and months.

Show highlights:

• Whether the investigation into the Ethereum Foundation is confirmed and why the SEC would do this
• Why Sam Enzer believes that the SEC would be "utterly wrong and ridiculous" in alleging ETH is a security
• Whether the number of people working on Ethereum could make the argument that it is decentralized
• How would the SEC justify that ETH is a security and whether the Foundation is running Ethereum’s managerial efforts
• Whether the SEC is looking for evidence to deny spot ether ETFs
• Why SEC chair Gary Gensler has changed his mind on many of his previous stances regarding crypto assets and whether he's acting in good faith
• The ongoing battle between the SEC and the CFTC and the need for Congress to regulate the industry
• What the possible outcome of this investigation could be, and whether we'll have a court case soon
• What the impact would be if ETH were classified a security
• Whether Prometheum could launch its platform offering custody of ETH as a security before an SEC designation
• Why Sam believes that the spot ETH ETFs will be denied on May 23rd
• How the SEC has already made up its mind even before gathering the facts, according to Sam
• Whether the recent judgment on Coinbase's case affects the potential case against the EF
• Whether Ethereum transactions are security transactions, and the difference between primary and secondary sales
• What to expect in terms of regulation and enforcement actions in the short term, given the number of cases at the moment

Thank you to our sponsors!

• Polkadot

Guests:

• Sam Enzer, Partner at Cahill Gordon & Reindel
• Previous appearances on Unchained:
• How 'a Criminal Choice' Got Sam Bankman-Fried a 25-Year Prison Sentence
• Why the SEC’s Case Against Coinbase Is So Significant for Crypto
• Why SBF’s Testimony So Far Has Likely Already Doomed Him
• Another Bad Week for Sam Bankman-Fried in His Criminal Trial
• Why These Lawyers Say It’s Over for SBF-But His Only Hail Mary Is to Testify
• SBF Trial: How Sam Bankman-Fried’s Lawyers Might Try and Win His Case
• SBF’s Lawyers Could Be Annoying the Judge How Might That Impact the Trial?
• Greg Strong, partner at DLx Law
• Previous appearance on Unchained: Why These Lawyers Say It's Over for SBF-But His Only Hail Mary Is to Testify

Links

Ethereum Foundation investigation:

• Fortune: SEC probing crypto companies in Ethereum investigation as hopes for ETF dim
• CoinDesk: Ethereum Foundation Faces Inquiry From a Government; Fortune Says SEC Investigating ETH
• Unchained: Ex-CFTC Commissioner Says ETH Can Be Both a Commodity and a Security
• Unchained: SEC Investigating Ethereum Foundation Regarding Proof-of-Stake Transition: Report 

Ethereum’s security status

• Unchained: Ex-CFTC Commissioner Says ETH Can Be Both a Commodity and a Security
• Fortune: SEC’s Gensler seen telling hedge funds that Ethereum and Litecoin are ‘not securities’ in 2018 video
• CNBC: 
• SEC Chair Gary Gensler on potential Crypto regulation: It's within the securities laws
• SEC Chair Gary Gensler discusses potential crypto regulation and stablecoins

For more details and links, visit Unchained

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