Zcash $ZEC can challenge Bitcoin's network effects Bitcoin $BTC is the dominant digital currency (>90% mkt share) But financial privacy may be a "must have" feature in an age of AI If correct, price of ZEC may still have significant upside. Read our Research perspective. ⬇️🛡️

ZACH PANDL SAYS AI NEEDS BLOCKCHAIN TO SCALE @LowBeta thinks attention comes back to crypto because these are two complementary technologies growing together, not competing: - Agentic commerce is going to happen extensively on blockchain rails, since blockchains offer the transparency and trustlessness AI agents need - Blockchains can also build decentralized alternatives to centralized control of AI - Investors will need both crypto and AI exposure in their portfolios long term, and his approach stays long-run thinking and optimism

Back to basics. We believe Bitcoin $BTC adoption will keep rising because of: 1) Unchecked government debt growth 2) More use of blockchain tech in financial services 3) Generational shift in portfolio construction More details in Grayscale's research blog ⬇️

It was great to join @NateGeraci to talk Bitcoin custody To state the obvious, Grayscale Research believes Bitcoin ETFs, with their embedded institutional custody, are a great choice for adding $BTC exposure to a diversified portfolio But, equally as obvious, self-custody is essential to get the full benefits of the technology Bitcoin must have (and does have, in my view) custody options for everyone See link below for the full conversation and more details in our recent blog:

gained a ton of new insights working in bitcoin red team 🟥 that i wish i could share without vague posting. but this is what i got anon. - we’re experiencing a massive collision between decades of human open source slop against 2 weeks of kimi k3 (not good) - everything is broken, bitcoin is burning - bitcoin is becoming stronger through this - bitcoin is the obvious first target but the rest of the world will follow shortly - sometimes old things need to burn so new things can grow on healthy soil - humans should never code in c (just stop) - lightning is complicated and is more broken than the average (sorry) - verification is free. we used to complain about slop PRs. then about slop security audits. if you can’t handle the information overload, stop complaining and use AI to sort through it. - those projects that started AI audits months ago are in a completely different position than those who didn’t - projects need their own AI audit pipeline going into the future - the burden for a developer to keep software safe and secure is pretty stressful and not for everyone. it has become a lot more stressful now. - unmaintained projects are most probably broken, don’t rely on them. i’d rather one-shot it myself with a modern AI - multiple concurrent, diverse human approaches have proven to be the best vulnerability search method - external red teaming will probably have to continue forever - we’ve basically completed a basic scan of virtually the entirety of bitcoin open source. the low hanging fruit is done. - we’ve reported a ton of real critical and high vulnerabilities. project maintainers across the board have validated our findings. - response speed is very different across projects and shows how healthy each project is. i recommend acting fast these days. - red team etiquette matters. if you don’t disclose responsibly, boast on twitter about your findings on a particular project, or make indications about the nature of particular findings, you’ve disqualified yourself as a serious security researcher. trust is the most important factor in this game. if you lose it, it’s very hard to win it back. - did i mention that humans should not code in c? love you all.

PNC Bank is running a new ad that positions buying NFTs as the opposite of sound financial advice: NFTs are not for everyone, but they are here to stay, and some will be very valuable (imo, not financial advice!)

This is a cool dashboard: historical and realtime liquidity comparisons across venues. Hyperliquid is not only the most liquid venue for major crypto and RWA perps, it's more liquid by an *order of magnitude* for some of them like the S&P500. Thanks to the ASXN team for building this!

AI adoption will create demands that public blockchains are built for: ↳ Payments: @ethereum $ETH & @solana $SOL provide the settlement infrastructure for agentic finance. ↳ Identity: @worldnetwork $WLD can provide verifiable online identity to distinguish humans and agents. ↳ Networks: @opentensor $TAO offers a decentralized alternative to closed AI dominated by frontier labs. Read more from our research on The Stack:

My thoughts on issuance: 1. the problem is real 2. the direction of the EIP is valid 3. but: changing issuance also has major downsides 4. most importantly: the decision must be with the community I said a few words on the ACD call on Thursday, and wanted to expand on my thinking - both as Ethlabs co-founder and ACD moderator. In general, being able to have difficult conversations in public has always been a core strength of Ethereum. 1. The problem is real - Slashing is core to Ethereum’s security. Not all attacks are automatically slashable. E.g. a majority of validators could censor the chain through malicious attesting. It needs to always be credible to slash such attackers. The larger portion of ETH is staked, and the tighter staked ETH is integrated into DeFi, the more credibility of slashing is at risk. - Worse dilution for stakers: at low stake %, most rewards are real income. At high stake %, most rewards just offset dilution. - Economies of scale: The competitiveness gap between centralized staking providers and both solo stakers and more decentralized staking providers widens at higher stake rates. - Narrative confusion around ETH: ETH is a “productive asset” due to protocol revenue (fees & MEV), not staking yield. The staking yield also risks crowding out the emergence of other (productive) yield opportunities for raw ETH. - Worse dilution for raw ETH holders: In general, harder assets are more attractive. BTC as the only $1T+ digital store-of-value explicitly centers zero long-term supply growth as its value proposition. Counter point: Gold with 1-2% yearly supply growth has a $30T store-of-value market cap. 2. The direction of the EIP is valid - If one wants to limit the stake rate, the issuance curve needs to bend downwards for high stake %. The EIP is a specific instance of such a curve. - The EIP also includes a further issuance reduction as a second phase. This introduces minimum viable issuance (MVI) as a secondary, monetary objective of the EIP. I personally think that is reasonable, but these two aspects should be discussed and reasoned about separately. 3. Changing issuance also has major downsides - The decentralization of the staking set is crucial for Ethereum’s health. Many solo stakers are less economically competitive than large operators. A change that results in a significant drop in staking yield risks having these solo stakers disproportionately leave the staking set. - Staked ETH is tightly integrated into DeFi today, both directly though LSTs, and through raw ETH lent out for the purpose of staking. Any major reduction in staking yield thus risks disrupting a core part of DeFi. This effect is worse the more rapid and more significant the yield drop is. - Any change to Ethereum’s monetary policy resets the “monetary policy ossification clock”. Predictability of supply matters for ETH’s attractiveness as store-of-value. So far, changes are only ever towards issuance reduction, but will investors trust that that will hold true forever? - Ethereum is overall at a pivotal moment. Given the large social cost of any months-long debate on issuance, it is reasonable to argue that this should wait until Ethereum overall is in calm waters, even if it makes a decision at a later time more painful. 4. The decision must be with community - Most hard fork decisions are made by the allcoredevs (ACD) governance process. Conceptually, this is “delegated authority” by the community to the core devs. This delegation is very effective on most technical topics. For the occasional hard fork decision that is not primarily technical, this setup is however less well suited. - Issuance in particular is not a technical decision. The decision still needs to be anchored to the ACD process - core devs need to coordinate on what to implement - but the actual decision forming needs to happen on the community level. - This is easier said than done. The ACD process is flawed but well defined. A “community decision” is much fuzzier and harder to operationalize. Discussion venues like X are important, but also limited. How to have high quality community-wide discussions remains an important challenge to solve. As we are getting off the ground at Ethlabs, we are trying to find the right path for how to contribute to both Ethereum and ETH. Issuance is a tricky topic for us: Caspar and I have argued for issuance changes in the past, and for now continue to have conviction in that path. The Ethlabs team as a whole has a wider spectrum of opinions, which has been healthy for internal discourse. And of course, we also see the broad community skepticism on this topic. The ability to have difficult conversations has always been a core strength of Ethereum. Our role in that should be to productively contribute to and engage with such conversations, not to blindly run in one direction. We will iterate to get that balance right, and genuinely appreciate feedback as we do.

🚨GRAYSCALE: CRYPTO KEEPS MOVING WITHOUT CLARITY ACT! Odds of the market structure bill passing this year now look low, per @Grayscale Head of Research @LowBeta. But no CLARITY won’t stop major blockchains, Bitcoin demand, or stablecoin growth, the industry has advanced nearly 17 years without it. Current regulatory guidance and expected SEC rulemaking will keep supporting the space, though more new investment may shift overseas.