The Blood Runs Red

I'll try not to pour salt on any wounds, but what a terrible week for the markets...again.

I'll try not to pour salt on any wounds, but what a terrible week for the markets...again. It's estimated that about $7 billion was liquidated from the crypto market this week. We all felt the pain. I'm too much of an optimist to short, even though all of my own research showed that when we closed below $91.5k on Jan 31st that it meant max pain.

Was this a "healthy" shake out of leverage? It felt worse than the Luna/FTX crash because there was a clear catalyst for that movement. I think this kinda sums up how everyone felt this week.

More Than Words...we got Extreme

Arthur Hayes and others are saying this dump is possibly due to dealer hedging off the back of $IBIT structured products. There's a lot of paper bitcoin being traded out there with options, products, perps, etc. When the fox gets invited into the hen house, you deal with the consequences.

Solana Network Stability

Can we move away from claiming Solana goes down a million times a year? It's been 2 full years without a Solana outage (and technically 3 full years without a performance-related one). The network is doing just fine through the chaotic times.

Vitalik's L2 Roadmap Comments

Vitalik said the quiet part out loud that everyone has felt and known for the past few years. The L2 roadmap didn't work as intended and they are scaling the Eth L1 and looking to transition to a zkEVM. If you were one of the people (myself included) that clearly saw the issue, you got attacked by ETH maxis nonstop. Welcome to reality. His post caused a lot of ruffled panties within the ETH community.

What happened? L2s' progress to stage 2 (and, secondarily, on interop) has been far slower and more difficult than originally expected. If the L2's had actually cared about true interop, maybe it could have worked, but when Polygon tried, no one seemed interested.

When new L2's have launched, mercenary capital floods in to farm and quickly leaves. Does anyone really use anything beyond Base or Arbitrum?

Vitalik's Zcash Donation

Speaking of Vitalik, Shielded Labs announced that Vitalik made a donation to support the continued development of Crosslink. Vitalik said: "Zcash is one of the most honorable crypto projects with a steadfast focus on privacy. Shielded Labs' Crosslink work will allow Zcash to be more secure and on a lower security budget, supporting its long-term sustainability."

Crosslink isn't what everyone wants though. The CEO of Zcash, Mert, has been strongly against Crosslink, stating: "crosslink is a stupid idea and will not pass". He added that if a chain can't attract miners, adding a validator set doesn't solve the underlying problem — it just moves trust from miners to a smaller set of stakers, which given ZEC's market cap, won't give serious people much confidence.

Crosslink also introduces new liveness DoS attacks, splits security budget, and creates cross-contamination loops that are difficult to reason about.

Solana Mobile Hackathon

Radiants announced MONOLITH, the second Solana Mobile Hackathon with $125,000+ in prizes. There are 10 winners at $10k per, and 5 honorable mentions at $5k per. There's also a bonus: $10,000 in $SKR for the best SKR integration.

Bithumb's Bitcoin Mistake

Korean crypto exchange Bithumb ran a promotional giveaway meant to pay users 2,000 won ($1.50), but winners instead received 2,000 BTC each. They managed to recover 93% of the 620,000 BTC mistakenly sent to users. However, 125 BTC remain unrecovered. How does an exchange send bitcoin it apparently didn't have in reserves?

Charles Hoskinson Liquidation

Charles Hoskinson got liquidated for $3 billion. He doesn't seem to care, saying he's rich. Cardano continues crushing as always.

Michael Saylor and Quantum Resistance

Michael Saylor is throwing money at trying to prep BTC for quantum resistance. Although he thinks it's 10 years out, this feels like an attempt to calm investors. If Bitcoin doesn't manage this, it's lights out, though the Bitcoin community moves very slowly on such changes.

Kyle Samani Departure

Kyle Samani is stepping back from Multicoin Capital. He will continue to serve on the board of Zama and his role as Chairman at Forward Industries. He made waves in the industry and had an amazing run.

Solana TPS Visualization

For meditation on what looks like the matrix, you can visualize 1000+ TPS in real time on Solana at beautifulmachine.xyz.

Crypto Market Structure Bill

The fact that Democrats are in opposition to a bill providing rules of the road and clarity for crypto regulation continues to be puzzling. Finance isn't partisan. Treasury Secretary Scott Bessent says the US has to get the crypto market structure bill "across the finish line" this year, noting: "It's impossible to proceed without it." The political dynamic stems from Trump's personal profit interests in crypto projects.

Forced Selling and Market Floor

Forced selling eventually hits a wall.

SEC Paul Atkins on Digital Assets

SEC Paul Atkins didn't say the CLARITY bill is done. He stated about digital assets: "We are out to harmonize the rules between the SEC and the CFTC, giving clarity and certainty to the innovators and to investors...so that people can develop their products in the United States rather than feel that they have to go offshore."

Molt AI Agents on Solana

Malware was found in the top downloaded skill on clawhub — be very careful and do your research. Molt is a free AI Agent platform (requiring a .molt name NFT mint) integrating OpenClaw to bring personal AI agents to Solana. Each .molt domain is a Metaplex Core NFT unlocking your own AI agent instance.

What you get:

• Wallet-based access — No accounts, no passwords. Connect your Solana wallet, prove NFT ownership, instant access
• Per-domain agents — Each domain NFT gets its own isolated AI agent with persistent memory
• Configure your channels — Set up Telegram, Discord, or Slack bots directly from the UI
• Persistent storage — Your agent's memory and conversations persist in R2 storage, tied to your NFT

Bitcoin's Inherent Value

The next time someone unfamiliar with crypto says Bitcoin has no inherent value, I plan to reference Mert's tweet on the subject to save myself the annoyance.

Keeping it light this week. Stay Free • Ebullition