Jupiter

Jack Kubinec

This is a segment from the Lightspeed newsletter. To read full editions, <a href="https://blockworks.co/newsletter/lightspeed">subscribe</a>.



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 Multicoin Capital was one of Solana’s early investors. Now it’s trying to change the <a href="https://blockworks.co/news/lightspeed-newsletter-solana-economics">network’s inflation mechanism.</a>



The Austin, Texas-based firm <a href="https://github.com/solana-foundation/solana-improvement-documents/pull/228/commits/8969b469c724e89f64ac42540d5f99948f6dc3b5">published</a> a Solana Improvement Document this morning that would change SOL emissions from the current fixed schedule to a market-based solution. Multicoin’s proposal would likely drive down inflation — which dilutes SOL holders — but would also lower staking yields, which are a boon for SOL stakers.



In Solana terms, inflation refers to the network issuing SOL to the validators who run Solana’s software and help build the blockchain. Validators then pass this issuance along with some MEV rewards to the stakers who delegate staked SOL to them.&nbsp;



In brief, Multicoin’s proposal sets a target staking rate of 50% for security and decentralization purposes. If more than 50% of SOL is staked, then issuance would decrease to discourage staking by reducing yield. If less than 50% of SOL is staked, then issuance would increase to raise yields and encourage staking. The minimum inflation would be 0%, and the maximum would be based on the current Solana issuance curve.&nbsp;



Solana’s inflation rate was initially set at 8%, and this figure will decrease by 15% yearly until it reaches 1.5% inflation. SOL’s inflation rate is currently around 4.8%, according to Solana Compass. Solana co-founder Anatoly Yakovenko said <a href="https://www.youtube.com/watch?v=OLsSUqQc-N8">on the Lightspeed podcast</a> that the fixed rate idea was borrowed from the Cosmos blockchain, and inflation is just “accounting.”



Yakovenko doesn’t care much about inflation, because the process of SOL issuance doesn’t create or destroy value, it simply moves value around. Newly-minted SOL gets passed along to stakers, while non-stakers see their holdings become relatively less valuable.



Still, Multicoin sees a reduction in SOL inflation as necessary for a few reasons. New SOL being passed only to stakers centralizes the network, high inflation reduces the usefulness of SOL for things like DeFi since there’s a high opportunity cost to not stake, and only 9% of staked SOL is liquid. Lower staking rewards could also reduce sell pressure in jurisdictions where staking rewards are counted as income for tax purposes.&nbsp;



Even though issuance doesn’t technically induce a cost to the network as a whole, the negative perception created by unstaked SOL being diluted makes it worth limiting inflation in Multicoin’s view.



There’s some positive precedent here: Ethereum had narrative success defining ETH as ultrasound money after becoming a proof-of-stake network and greatly diminishing its issuance. But there’s also negative precedent in a different way: Cosmos adopted a market-based inflation mechanism for ATOM, but its community has <a href="https://www.theblock.co/post/273899/cosmos-hub-inflation-reduction-proposal-rejection">quibbled</a> over where the bounds should be — and ATOM’s price is still down 34% over the past year.&nbsp;



In any event, Multicoin partner JR Reed told me the proposal was inspired by perpetual swaps and their use of funding rates, not Ethereum’s mechanism for limiting inflation. 



There’s one other obvious consequence of Multicoin’s proposal: SOL staking yield, which has <a href="https://dune.com/21co/solana-key-metrics">historically</a> stayed higher than 7%, would decrease if issuance decreased. A growth in MEV rewards could offset the lower inflation, but otherwise, staking SOL would begin to pay fewer dividends.



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Solana to weigh possible SOL inflation cut

Felix Jauvin

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Ever since COVID closed global economies in 2020, gauging where we stand in the business cycle has been a very difficult act.&nbsp;



The typical business cycle looks as follows, and historically, it’s been fairly easy to have a general idea of where we stood by contrasting it with interest rates and monetary policy:



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1251" height="876" src="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-3.png?w=1024&amp;h=1024" alt="" class="wp-image-96329" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-3.png?w=1251 1251w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-3.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-3.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-3.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-3.png?w=367 367w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-3.png?w=373 373w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-3.png?w=313 313w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-3.png?w=80 80w" sizes="auto, (max-width: 1251px) 100vw, 1251px" /></figure>



However, everything has been somewhat upside down in recent years, leaving many economists befuddled.&nbsp;



For example, in 2022 we saw negative real GDP prints (initially at two but then revised down to one):



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXcaD8bJiY9EI6a_un5011HMUAE4n7ebj2s_5L5kMY0FZFczdw-D709gyxWMsOHcQ10-Lxuf45W42gKdvFetRjM_yxCIor80D161xiORXbMsIENJ3z0S87FY2mZXKHRj5y88FfGwyg?key=Gt2XLrt4V7a7uq7GkcoKF_N2" alt=""/></figure>



However, during that same time we saw one of the hottest labor markets we’ve ever seen, as per JOLTS data.&nbsp;



It’s hard to believe in a recession with a labor market that strong:



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfu1pS8mCEdMrnS9J3iGUp6gAL8JCfIDtYyn-kGoEFZvoR43BLyADoRFcRQEqzar_TQZrKSDVO1UN3gEVurdCjqw87-MlsArccmbQPBF_Og3OGJuvEOC_VQc1vDj0NntflgCL78?key=Gt2XLrt4V7a7uq7GkcoKF_N2" alt=""/></figure>



Since 2022, we’ve seen a major rate hiking cycle from the Fed that somehow also didn’t tilt the economy into a recession when looking at it on an aggregate basis. Stocks hit new highs everyday, the labor market cooled but remained resilient, and GDP growth powered ahead.



During that same time, however, if you honed in on the manufacturing and goods sector and set aside the services economy, it almost looks like we’ve just been through a manufacturing recession.&nbsp;



ISM Manufacturing PMIs have been in contraction territory for a couple years now:



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1600" height="1002" src="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2-1.png?w=1024&amp;h=1024" alt="" class="wp-image-96328" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2-1.png?w=1600 1600w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2-1.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2-1.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2-1.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2-1.png?w=1536 1536w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2-1.png?w=410 410w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2-1.png?w=417 417w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2-1.png?w=350 350w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-2-1.png?w=80 80w" sizes="auto, (max-width: 1600px) 100vw, 1600px" /></figure>



During that time, we saw significant disinflation leading to outright deflation in the goods sector of the economy:



<figure class="wp-block-image is-resized"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfgDG1Vk4pLHxhRoWvTWu4Odo0vZpcfPvp3egPuVaVpT39kmU3Wq7mJ2EOvfkxMkHMbQm5SM6mXOhcU-0mB_z37DzuAOX9yLHd8dA3PBUmGXcaau2BkoCeXSIQ4Hu3_UEpMJvXN1A?key=Gt2XLrt4V7a7uq7GkcoKF_N2" alt="" style="width:480px;height:auto"/><figcaption class="wp-element-caption">Source: <a href="https://inflationguy.blog/2025/01/15/inflation-guys-cpi-summary-december-2024/">inflationguy.blog</a> </figcaption></figure>



Fast forward to today, and we’ve seen the Fed cut rates to frontrun concerns about the labor market and continue attempting a soft landing of the economy where we move into a new business cycle without a recession.



We’re now seeing leading indicators hinting that the manufacturing sector might be exiting the doldrums and heading toward a new upswing.



We’re starting to see commodities begin to break out after two years of consolidation, hinting at an upswing in economic growth:



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXemmqOzL4DMgA6_oqmypMeAV88GMrAAuwLilLBFwzrbGzVH_JZMOuHF4WsC9O8agmsVvcg1hP10KrrsgvIVOcfj0SlN0JA4fG1lQ2nDtiad4XRGc3jpai2kV72_RjLEfEZekeL5?key=Gt2XLrt4V7a7uq7GkcoKF_N2" alt=""/></figure>



ISM new orders look to be breaking out, as well as the Philly Fed manufacturing index: 



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1600" height="853" src="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1-1.png?w=1024&amp;h=1024" alt="" class="wp-image-96327" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1-1.png?w=1600 1600w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1-1.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1-1.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1-1.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1-1.png?w=1536 1536w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1-1.png?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1-1.png?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1-1.png?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/unnamed-1-1.png?w=80 80w" sizes="auto, (max-width: 1600px) 100vw, 1600px" /></figure>



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXeJJdCi6qIkwK5gQkla7A3FAtcLx_w3R6cLf3gZiCPpyAc9HkeC9rbM4G4oJ3N6r8-Q-GAA8TGs3OOattGg5lB4QqW643LdYPDor7ChxhBb18lMZU0axQRWHViEftCFH_yhq6wmrQ?key=Gt2XLrt4V7a7uq7GkcoKF_N2" alt=""/></figure>



Per the survey data, it’s looking like much of this is being led by optimism from the business sector ever since the <a href="https://blockworks.co/news/donald-trump-declared-president-2024-election">election</a>:



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfpE451KEJufpBH6Rq7ZdDK10o8EG5j2AQRGI7SbOz0vQNLgtaNGjRT4Xy0GDzzlH0T_qXeO6EBr9YMGjtbiwvQdAoZeBdNYTZoR8GktQDNHN-vlBEhhZu_83bCPRQoCmvDaIXNaw?key=Gt2XLrt4V7a7uq7GkcoKF_N2" alt=""/></figure>



So where does this chart-geeking journey lead us?&nbsp;



I think it’s safe to say we’re not late in the cycle. It increasingly looks like we are in fact in the early innings of a new business cycle that avoided a recession due to the huge fiscal stimulus and deficits during the last couple of years.



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Are we at the start of a new business cycle?

Casey Wagner

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The SEC has moved forward with an appeal in its <a href="https://blockworks.co/news/sec-files-ripple-appeal-precedent">case against Ripple</a>.&nbsp;



The securities regulator is seeking to reverse a 2023 <a href="https://blockworks.co/news/judge-rules-ripple-xrp-not-security">ruling</a> that determined retail sales of Ripple’s XRP token were not unregistered securities offerings. Federal Judge Analisa Torres said that blind/programmatic sales of XRP, which occur on exchanges, were not in violation of US securities laws.&nbsp;



“The district court erred both factually and legally in concluding that defendants’ offers and sales of XRP to public buyers who purchased on crypto asset trading platforms,” the SEC wrote in its opening brief, filed late last night.&nbsp;



Even if buyers didn’t know their XRP tokens were coming from third parties or Ripple itself, Ripple still led the public to have “reasonable expectations of profits” from the cryptocurrency, the SEC said. Ripple’s “public marketing campaign…specifically engaged ‘less sophisticated’ investors,” the regulator added.&nbsp;



Ripple chief legal officer Stuart Alderoty dismissed the SEC’s claims, writing on <a href="https://x.com/s_alderoty/status/1879680738926481670">X</a> that the brief is nothing but “a rehash of already failed arguments.”&nbsp;



Plus, Alderoty added, <a href="https://blockworks.co/news/sec-chair-nominee-crypto-past">new leadership</a> at the SEC is likely to &#8220;abandon&#8221; the case altogether.&nbsp;&nbsp;



On this last point, I’m less certain that the SEC will drop this case after Trump takes office and Chair Gary Gensler <a href="https://blockworks.co/news/gary-gensler-resigning">departs</a>, at least immediately. It’s possible, but any decisions Commissioners Hester Peirce and Mark Uyeda make in the short term (before three additional commissioners are appointed and confirmed) will face harsh legal scrutiny. 



We’re much more likely to see commission votes resume after there are at least three sitting commissioners.



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SEC moves ahead with Ripple appeal in Gensler’s final days 

Ben Strack

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Amid ongoing speculation about an American strategic bitcoin reserve, several US states are looking to take matters into their own hands.&nbsp;



“It&#8217;s time for Texas to lead the way in establishing a strategic bitcoin reserve,” Texas senator Charles Schwertner wrote in a Wednesday X <a href="https://x.com/DrSchwertner/status/1879630775835890082">post</a>.&nbsp;



The GOP lawmaker’s proposal calls bitcoin a valuable digital asset “with strategic potential for enhancing this state’s financial resilience.” Its decentralized nature and finite supply are “unique qualities that can serve as a hedge against inflation and economic volatility.”



The draft bill seems to echo a Texas House <a href="https://legiscan.com/TX/text/HB1598/2025">proposal</a> from Rep. Giovanni Capriglione last month.&nbsp;



The reserve would be a “special fund” outside the state treasury’s general revenue fund. The comptroller would be responsible for establishing secure custody of the BTC (i.e. via cold storage) and may contract a US-based third party for help.&nbsp;



The Texas legislature — by a two-thirds majority vote in each house — can direct the comptroller to transfer, sell or convert the reserve’s BTC. It would then deposit proceeds to another state treasury fund or account.&nbsp;



Meanwhile, a lawmaker from Oklahoma (Cody Maynard) <a href="http://webserver1.lsb.state.ok.us/cf_pdf/2025-26%20int/hb/HB1203%20int.pdf">introduced</a> a bill to allow the state treasurer to invest public funds in BTC, stablecoins or any other digital asset with an average market cap north of $500 billion over the previous calendar year.&nbsp;



Money used for such purchases could come from the state’s general, revenue stabilization and/or constitutional reserve funds. The amount it invests in BTC can’t exceed 10% of the public funds in the account.&nbsp;



These proposals follow similar ones by <a href="https://www.legis.state.pa.us/cfdocs/billInfo/billInfo.cfm?bn=2664&amp;body=H&amp;sInd=0&amp;sYear=2023&amp;type=B">Pennsylvania</a>, <a href="https://x.com/Dennis_Porter_/status/1877746381949116787">New Hampshire</a>, North Dakota and other states.



While the fate of <a href="https://blockworks.co/news/bitcoin-as-a-potential-us-reserve-asset">Cynthia Lummis’s</a> national BTC reserve plan remains unclear, at the very least <a href="https://blockworks.co/news/trump-campaign-promises-bitcoin-reserve">Trump has promised</a> to keep the BTC the government already possesses.



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State bitcoin reserve plans proliferate

Macauley Peterson

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The rise of “<a href="https://blockworks.co/news/bitcoin-powerful-defi-potential">Bitcoin DeFi</a>” on new networks looking to scale Bitcoin has primarily come through bitcoin-backed derivatives like SolvBTC.BBN and LBTC. These derivatives receive staking rewards from Babylon, offering new avenues for liquidity and yield generation. However, concerns about the transparency of these platforms, particularly regarding the management of bitcoin reserves, have sparked debate within the Bitcoin community.



A recent <a href="https://x.com/trackoor/status/1875307649862135830">article</a> by the co-founder of Nubit, known online as Hans, raised alarms about the potential for unbacked reserves and the inflation of total value locked (TVL) in platforms like Solv. These concerns highlight broader risks in the bitcoin-backed derivatives space, especially as market volatility persists.



SolvBTC is minted by depositing either BTC or flavors of wrapped bitcoin so that solvBTC tokens mirror the value of the BTC held in reserves 1:1.



But after that, solvBTC can be moved freely across chains and apps, making it challenging to track TVL. That led to <a href="https://x.com/trackoor/status/1875876403536953575">allegations</a> of double-counting solvBTC issuance.



Solv co-founder Ryan Chow <a href="https://x.com/RyanChow_DeFi/status/1875414459747070086">called</a> the claims “a smear campaign, coordinated and orchestrated” by Solv’s competitors.



SolvBTC.BBN suffers from a liquidity discount which <a href="https://x.com/januszg_/status/1876728550931190049">deepened</a> to 7% last week following a hack of the protocol’s X account.



Solv has <a href="https://x.com/SolvProtocol/status/1876544783507988566">pledged</a> to reimburse user funds lost as a result of the hack.



Despite these clarifications, the core issue remains that Solv, like other bitcoin-backed derivatives platforms, introduces additional layers of trust. While some transparency improvements are being made, the underlying reliance on centralized mechanisms to mint and manage bitcoin-backed derivatives adds risk for users. As @0xTindorr pointed out in an X <a href="https://x.com/0xTindorr/status/1876479673154392268">thread</a> defending Solv, any bitcoin liquid staking tokens (LSTs) inherently carry additional risk.



As the bitcoin-backed derivatives market continues to expand, ensuring these platforms are genuinely backed by reserves and thus remaining transparent will be crucial to maintaining trust and mitigating risks. Users must remain cautious, understanding that the promise of liquidity and yield often comes with hidden risks, especially when the backing of assets is unclear.



Solv Protocol’s native token, SOLV, is set to list Thursday on Binance with a total supply of 9.66 billion and an initial circulating supply of approximately 1.48 billion at time of listing. The token’s launch, which followed a points campaign, adds a new layer to the growing ecosystem of bitcoin-backed derivatives. It will be revealing to monitor performance in this space in light of the potential risks associated with Solv’s expanding offerings.



Other bitcoin derivative issuers, including Lombard and Bedrock, have been using points programs to entice deposits, often a prelude to launching a token.



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Risky business? Transparency in BTC-backed derivatives

Katherine Ross

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If I were to boil it down, I’d say there are three key reasons why Tribe Capital’s Evan Park is bullish on DePIN. The use cases, sustainability, and — of course — the revenue potential.



Tribe’s backed a few DePINs including Wynd Networks (the <a href="https://blockworks.co/news/grass-data-verification-depin-funding">company behind Grass</a>), flight tracking project Wingbits and Akash.&nbsp;



When looking at DePIN projects, Park’s biggest question is whether or not the project is “solving a problem where real demand can be generated.”



Specifically, when Park is being pitched, he’s skeptical when a project shows him revenue figures that aren’t necessarily coming from the underlying network.&nbsp;



I asked him what makes him call bullshit on a DePIN pitch and he told me: It’s “important to distinguish revenue in crypto, but also in DePIN.” He wants to know where the revenue is coming from, essentially. Are the users also validators? Are individuals “contributing to the network and their data, is that the thing that’s making revenue?”



He also keeps a close eye on organic growth and gets validation on potential demand.



But a good team, and a founder “deep in the space” are huge green flags for Park. If this sounds familiar to you, it’s probably because Wyatt Lonergan of VanEck Ventures told us that he also pays close attention to project teams last month.



“It&#8217;s a consideration that&#8217;s more important in DePIN than any other sector. But also having domain expertise, or having advisors and team members that have that domain expertise in your given industry, while bridging that with crypto native experience. It&#8217;s not enough to have one without the other,” he noted.&nbsp;



And there’s your insider scoop for the day.



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What to look for in DePIN projects: Tribe Capital VC

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The full version of Firedancer — a very-performant re-write of Solana’s validator software authored by Jump Crypto — may still be <a href="https://blockworks.co/news/2025-solana-product-launches">a ways away</a>. But in the meantime, Solana validators still can use a limited version of the client named Frankendancer. 



Frankendancer was spawned by Jump taking the Agave client, which is descended from the original Solana Labs software, and replacing parts of it piecemeal to create a new client akin to Frankenstein’s monster. Frankendancer <a href="https://blockworks.co/news/lightspeed-newsletter-solana-firedancer-testnet">went to Solana mainnet in September</a> during Solana’s Breakpoint conference — but since then, it’s seen limited uptake.



So far, 12 validators controlling roughly 5.4 million staked SOL are running Frankendancer, according to <a href="https://beta.validatorbase.com/solana">data</a> from Validatorbase. That’s out of 392 million staked SOL in existence, according to Solana Compass.



The “main reason most validators aren&#8217;t running [Frankendancer] yet is because it doesn&#8217;t capture MEV efficiently,” Temporal engineering partner Ben Coverston told me.



Maximal extractible value, or MEV, is the processing of adding, removing, or reordering transactions in a block to extract extra value. Many Solana validators capture MEV by running the Jito-Solana client, which is a version of the Agave client with MEV modifications attached.&nbsp;



MEV is quite lucrative for Solana validators. Around 25% of validator staking rewards — which can be thought of like the revenue a validator creates by running Solana — currently come from MEV, <a href="https://dune.com/21co/solana-key-metrics">according</a> to a Dune dashboard. Roughly 65% of the rewards come from SOL issuance, and 10% comes from fees.&nbsp;



It’s not impossible to capture MEV without Jito, Coverston added, but it is certainly more difficult, so any validators who want to run Frankendancer are likely looking at a lower return on their investment.



That’s not to say there’s no reason to run Frankendancer. Phase Labs announced today that its validator has upgraded to the Frankendancer client, calling the software “the next leap forward” for Solana.



Phase’s Aeropool stake pool <a href="https://blockworks.co/news/solana-stake-pools-yield-vs-punishment">has specifically said</a> that its stake delegation strategy is to empower positive Solana contributors rather than only chase the highest APY.



Most validators don’t share this strategy — over 93% of Solana validators currently <a href="https://www.jito.network/stakenet/history/">use</a> Jito-Solana. On testnet, they may begin seeing some pressure to try Frankendancer however: Solana developer shop Anza has <a href="https://discord.com/channels/428295358100013066/594138785558691840/1326768397047824487">talked</a> about beginning to push for a Frankendancer supermajority of stake on testnet next week.



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Solana validators slow to adopt Frankendancer for MEV reasons

David Canellis

This is a segment from the Empire newsletter. To read full editions, <a href="https://blockworks.co/newsletter/empire" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Crypto is a creature of extremes. Look no further than the major narratives right now.&nbsp;



AI agents and memecoins are almost completely virtual. DePIN, meanwhile, derives practically its entire value proposition from very physical networks of hardware. In the real world.&nbsp;



So, you can’t fault Helium — the decentralized wireless carrier powered by Solana — for teaming up with DAWN to expand both their networks, together.



The pair have struck a partnership to allow Helium hotspot operators to serve DAWN broadband internet, and vice versa, to create “the world’s first fully decentralized last-mile internet solution.”



Like how Helium is shooting to disrupt centralized telecoms, DAWN is pushing to <a href="https://blockworks.co/news/two-vaneck-funds-back-depin-dawn">change our relationship with traditional ISPs</a>, allowing regular users to both own the infrastructure and be rewarded in crypto for providing wireless broadband to anyone in range.



“The conversation started with a strong alignment on the mission of decentralizing internet access,” a Helium spokesperson told me. “We&#8217;re moving toward making connectivity owned by the many and accessible to everyone.”



It means that the Helium Network will automatically grow by 8,000 nodes that already serve the DAWN ecosystem, according to a press release.



A Helium Foundation <a href="https://dune.com/helium-foundation/helium-makers">dashboard</a> meanwhile points to more than 25,000 mobile hotspots onboarded since last April, which hypothetically could serve DAWN broadband once the functionality is rolled out, although it’s not immediately clear how many are currently active.



<figure class="wp-block-image"><img loading="lazy" decoding="async" width="1382" height="998" src="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXcS2KLUG9cyxVVCmOyGyMtabV-GqO6WfmGYnWh-Jyw1sYAued80xonZL9J3L_UXvxcfOcSfyJaKEQyJW9mBV6ui_1t8RJQKdsPJwnUTe5Av3abo1bUC-NVYnfEE6SXvEVFkKRnhvw.png" alt="" class="wp-image-96300" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXcS2KLUG9cyxVVCmOyGyMtabV-GqO6WfmGYnWh-Jyw1sYAued80xonZL9J3L_UXvxcfOcSfyJaKEQyJW9mBV6ui_1t8RJQKdsPJwnUTe5Av3abo1bUC-NVYnfEE6SXvEVFkKRnhvw.png?w=1382 1382w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXcS2KLUG9cyxVVCmOyGyMtabV-GqO6WfmGYnWh-Jyw1sYAued80xonZL9J3L_UXvxcfOcSfyJaKEQyJW9mBV6ui_1t8RJQKdsPJwnUTe5Av3abo1bUC-NVYnfEE6SXvEVFkKRnhvw.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXcS2KLUG9cyxVVCmOyGyMtabV-GqO6WfmGYnWh-Jyw1sYAued80xonZL9J3L_UXvxcfOcSfyJaKEQyJW9mBV6ui_1t8RJQKdsPJwnUTe5Av3abo1bUC-NVYnfEE6SXvEVFkKRnhvw.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXcS2KLUG9cyxVVCmOyGyMtabV-GqO6WfmGYnWh-Jyw1sYAued80xonZL9J3L_UXvxcfOcSfyJaKEQyJW9mBV6ui_1t8RJQKdsPJwnUTe5Av3abo1bUC-NVYnfEE6SXvEVFkKRnhvw.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXcS2KLUG9cyxVVCmOyGyMtabV-GqO6WfmGYnWh-Jyw1sYAued80xonZL9J3L_UXvxcfOcSfyJaKEQyJW9mBV6ui_1t8RJQKdsPJwnUTe5Av3abo1bUC-NVYnfEE6SXvEVFkKRnhvw.png?w=356 356w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXcS2KLUG9cyxVVCmOyGyMtabV-GqO6WfmGYnWh-Jyw1sYAued80xonZL9J3L_UXvxcfOcSfyJaKEQyJW9mBV6ui_1t8RJQKdsPJwnUTe5Av3abo1bUC-NVYnfEE6SXvEVFkKRnhvw.png?w=361 361w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXcS2KLUG9cyxVVCmOyGyMtabV-GqO6WfmGYnWh-Jyw1sYAued80xonZL9J3L_UXvxcfOcSfyJaKEQyJW9mBV6ui_1t8RJQKdsPJwnUTe5Av3abo1bUC-NVYnfEE6SXvEVFkKRnhvw.png?w=303 303w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXcS2KLUG9cyxVVCmOyGyMtabV-GqO6WfmGYnWh-Jyw1sYAued80xonZL9J3L_UXvxcfOcSfyJaKEQyJW9mBV6ui_1t8RJQKdsPJwnUTe5Av3abo1bUC-NVYnfEE6SXvEVFkKRnhvw.png?w=80 80w" sizes="auto, (max-width: 1382px) 100vw, 1382px" /><figcaption class="wp-element-caption">Helium’s HNT is still working on reclaiming highs from the last cycle. DAWN, which has an active points program, is yet to confirm a token launch</figcaption></figure>



The spokesperson said that there’s no equity or investment deal as part of the partnership. Still, it all suggests a certain coalescence in the DePIN space.&nbsp;



Like how GPUs and ASIC mining rigs can be used to mine a number of different cryptocurrencies — switching between them based on profitability — we could be headed for a world where DePIN devices in our homes can be pointed to all sorts of different use cases depending on demand.&nbsp;



It might mean additional income for the household without the often extreme overheads related to proof-of-work mining, although how much would be largely dependent on token prices and whatnot.



<figure class="wp-block-image"><img loading="lazy" decoding="async" width="1380" height="1000" src="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXd1nND-GiHGinDzKPsTMQoHZpIsMAO9sRbIxvucteXY8QVyXzckJPVYFPSWbaG8q5B4smbdT9Sk21fQxESHnBI7ao1gb3IEupRaUJ1vkGak1ZA4ae1RNMwTOYrta425yRYk5J8aKg.png" alt="" class="wp-image-96299" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXd1nND-GiHGinDzKPsTMQoHZpIsMAO9sRbIxvucteXY8QVyXzckJPVYFPSWbaG8q5B4smbdT9Sk21fQxESHnBI7ao1gb3IEupRaUJ1vkGak1ZA4ae1RNMwTOYrta425yRYk5J8aKg.png?w=1380 1380w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXd1nND-GiHGinDzKPsTMQoHZpIsMAO9sRbIxvucteXY8QVyXzckJPVYFPSWbaG8q5B4smbdT9Sk21fQxESHnBI7ao1gb3IEupRaUJ1vkGak1ZA4ae1RNMwTOYrta425yRYk5J8aKg.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXd1nND-GiHGinDzKPsTMQoHZpIsMAO9sRbIxvucteXY8QVyXzckJPVYFPSWbaG8q5B4smbdT9Sk21fQxESHnBI7ao1gb3IEupRaUJ1vkGak1ZA4ae1RNMwTOYrta425yRYk5J8aKg.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXd1nND-GiHGinDzKPsTMQoHZpIsMAO9sRbIxvucteXY8QVyXzckJPVYFPSWbaG8q5B4smbdT9Sk21fQxESHnBI7ao1gb3IEupRaUJ1vkGak1ZA4ae1RNMwTOYrta425yRYk5J8aKg.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXd1nND-GiHGinDzKPsTMQoHZpIsMAO9sRbIxvucteXY8QVyXzckJPVYFPSWbaG8q5B4smbdT9Sk21fQxESHnBI7ao1gb3IEupRaUJ1vkGak1ZA4ae1RNMwTOYrta425yRYk5J8aKg.png?w=355 355w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXd1nND-GiHGinDzKPsTMQoHZpIsMAO9sRbIxvucteXY8QVyXzckJPVYFPSWbaG8q5B4smbdT9Sk21fQxESHnBI7ao1gb3IEupRaUJ1vkGak1ZA4ae1RNMwTOYrta425yRYk5J8aKg.png?w=360 360w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXd1nND-GiHGinDzKPsTMQoHZpIsMAO9sRbIxvucteXY8QVyXzckJPVYFPSWbaG8q5B4smbdT9Sk21fQxESHnBI7ao1gb3IEupRaUJ1vkGak1ZA4ae1RNMwTOYrta425yRYk5J8aKg.png?w=302 302w, https://blockworks-co.imgix.net/wp-content/uploads/2025/01/AD_4nXd1nND-GiHGinDzKPsTMQoHZpIsMAO9sRbIxvucteXY8QVyXzckJPVYFPSWbaG8q5B4smbdT9Sk21fQxESHnBI7ao1gb3IEupRaUJ1vkGak1ZA4ae1RNMwTOYrta425yRYk5J8aKg.png?w=80 80w" sizes="auto, (max-width: 1380px) 100vw, 1380px" /><figcaption class="wp-element-caption">Helium users are spending ~$6,000 HNT per week right now, up from under $3,000 in January 2024</figcaption></figure>



What’s interesting is that had this partnership not been made, eventually Helium and DAWN would’ve been considered competitors. But not really anymore.



Wouldn’t that make Elon Musk’s Starlink the biggest rival to the Helium-DAWN partnership, outside of the traditional carriers?



“Starlink is disrupting the connectivity industry in ways that were unimaginable just a few years ago,” the Helium spokesperson said. “Several Helium deployments use Starlink as an internet backhaul in the US and Mexico.”&nbsp;



The team has also developed a connectivity kit that combines Starlink with Helium Hotspots, to better serve phones in areas without cell coverage.



In any case, the Helium-DAWN partnership makes total sense, especially considering the latter is expected to airdrop a token to early adopters at some point.



After all, when it comes to incentivizing people to set up physical devices in their homes, two token flywheels must be better than one.



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Helium partners with DAWN to create ‘last-mile internet solution’

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I broke down the <a href="https://blockworks.co/news/coinbase-sec-appeals-decision">Coinbase-SEC court ruling</a> yesterday and noted it would take some time to sort out its broader implications.&nbsp;



One legal pro’s viewpoint suggests the decision could be a final straw of sorts to force long-anticipated regulatory clarity.



Monday’s court decision was not exactly surprising, according to Arie Heijkoop, a partner in Haynes Boone’s investment management practice group. The SEC’s response to Coinbase’s petition “was lacking in any substance,” he explained; but a court ordering an agency to issue a new rule has a high bar.&nbsp;&nbsp;



That said, Heijkoop told me the opinion’s descriptive language (exhibiting increased understanding of the space) suggests “the SEC may be running out of room to continue evading coming out with a defined position on crypto and digital asset regulation.”



Indeed, Judge Stephanos Bibas notes the SEC’s “old regulations fit poorly with this new technology, and its <a href="https://blockworks.co/news/regulation-by-enforcement-unsustainable">enforcement strategy</a> raises constitutional notice concerns.”



Bibas’s concurring opinion, in particular, seems to implore the SEC to distinguish the coins that operate more like securities from those that do not, Heijkoop explained.&nbsp;



“As the number of crypto products, and how they function, proliferate, if there will ever be crypto regulation handed down, it will likely have to account for those differences,” the Haynes Boone partner added.



This ruling may provide some optimism to defendants to challenge crypto enforcement actions if there is no further SEC guidance. But handing down a new rule would be “a fairly seismic action,” Heijkoop said.&nbsp;



Further, SEC actions for unregistered securities offerings may not fully cease given the decision’s recognition of crypto products with securities-type characteristics.



Whether the agency’s <a href="https://blockworks.co/news/sec-chair-nominee-crypto-past">new administration</a> offers more guidance through regulation rather than litigation remains a key question.



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Weighing in on the latest Coinbase-SEC ruling

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As President Biden rounds out his final days in office, the Senate has begun the process of confirming President-elect Trump’s Cabinet picks.



Defense Secretary hopeful Pete Hegseth was the first to take the hot seat.&nbsp;



Republicans, as expected, embraced Hegseth, calling his “unconventional” resume a strength while Democrats grilled him about his <a href="https://thehill.com/homenews/5084889-tim-kaine-pete-hegseth-hearing-infidelity/">character and judgement</a>. It was hours of tense questioning, but Senate Majority Leader John Thune says he plans to schedule the vote soon, and Hegseth should have the nomination in the bag.&nbsp;



On tap for confirmation hearings today are Trump’s picks for attorney general (Pam Bondi), CIA director (John Ratcliffe) and the White House office of management and budget (Russ Vought).&nbsp;



The Senate Banking Committee has not yet scheduled <a href="https://blockworks.co/news/trump-nominates-new-sec-chair">SEC chair hopeful</a> Paul Atkins’s confirmation hearing, but with widespread Republican <a href="https://www.banking.senate.gov/newsroom/majority/scott-statement-on-meeting-with-paul-atkins-nominee-to-serve-as-sec-chairman">support</a> Atkins should be a shoo-in. In the meantime, Trump will select either Commissioner Peirce or Uyeda to serve as <a href="https://blockworks.co/news/sec-crenshaw-confirmation-vote-cancelled">acting chair</a>. We’re expecting the transition team to announce this decision in the next few days.&nbsp;



In his final <a href="https://www.sec.gov/newsroom/speeches-statements/gensler-sec-011425?utm_medium=email&amp;utm_source=govdelivery">town hall</a> address Tuesday, <a href="https://blockworks.co/news/sec-commissioner-crenshaw-vote-delayed">outgoing</a> SEC Chair Gary Gensler praised his agency staff for their “wise counsel and help.”&nbsp;



“You vigorously followed the facts and the law without fear or favor to ensure that market participants comply with the securities laws, whether it be regarding traditional financial products or more recent ones like crypto,” Gensler said, in what may be his final nod to the industry as head of the agency.&nbsp;



Trump has still not named his pick for CFTC Chair. Rostin Behnam, who long <a href="https://www.cftc.gov/PressRoom/SpeechesTestimony/opabehnam48">advocated</a> for Congress to grant the CFTC explicit oversight of digital asset commodities, will be <a href="https://blockworks.co/news/cftc-chair-announces-departure">stepping down</a> on Monday. Caroline Pham or Summer Mersinger, both Republican CFTC commissioners, are expected to head the agency in the interim.&nbsp;



External candidates who’ve made Trump’s short list reportedly include former CFTC Commissioner Brian Quintenz, former agency official Josh Sterling and attorney Neal Kumar. I doubt we get an official nomination from Team Trump before Monday, but we’ll be on the lookout just in case.&nbsp;



Over in the House, Majority Whip Tom Emmer yesterday was selected to vice chair the digital assets subcommittee.&nbsp;



“With President Trump in the White House, and Gary Gensler confined to the waste bin of Washington, we have an excellent opportunity to ensure that the future of digital assets is guided by Americans, with American values,” Emmer wrote in a <a href="https://x.com/GOPMajorityWhip/status/1879319142303498579">statement</a> on X. 



Emmer, who co-sponsored the CBDC Anti-Surveillance <a href="https://blockworks.co/news/house-passes-cbdc-anti-surveillance-act">State Act</a>, the <a href="https://blockworks.co/news/senate-passes-resolution-to-overturn-sab121">anti-SAB 121</a> resolution and <a href="https://blockworks.co/news/fit21-crypto-bill-advances-to-senate">FIT21</a>, has advocated for <a href="https://blockworks.co/news/reps-ask-sec-for-clarity-securities-airdrops">more lenient</a> crypto regulation in recent years. The House Financial Services Committee has not yet released a schedule of upcoming hearings.



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Confirmation hearings for Trump Cabinet picks are underway

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The December CPI report shows some prices are coming down more than expected while the cost of other goods and services continue to rise.&nbsp;



Today’s release was enough to satisfy investors, though.&nbsp;



The S&amp;P 500 and Nasdaq Composite indexes were trading 1.8% and 2.3% higher, respectively, at 2 pm ET Wednesday. The mid-week rally helped pare losses from earlier in the week. The Nasdaq Composite is now flat for the past five trading days while the S&amp;P 500 has edged into the green, now up 0.5% over that time.&nbsp;



Prices increased 0.4% over the month and 2.9% over the year, coming in close to the forecasted readings of 0.3% and 2.9%, respectively. Core CPI though, which excludes food and energy prices, slowed to 3.2% in the 12 months ended December, just under analysts’ expectations of 3.3%.&nbsp;



The report had little impact on interest rate expectations, with fed funds futures markets still calling for a 97% chance committee members hold rates steady later this month.&nbsp;



Still, December’s reading shows the central bank has made some progress in moving inflation back down to its 2% target, and investors were thrilled.&nbsp;



Looking ahead, analysts say <a href="https://blockworks.co/news/rate-cutting-cycle-2025">rate cuts in 2025</a> are probably still in the cards, but not too many of them.&nbsp;



“The key question now is whether the FOMC’s ‘skip’ turns into a more prolonged ‘pause’,” said Michael Brown, senior research strategist at Pepperstone. “Risks around the policy outlook this year are considerably more two-sided than those seen last year, with a renewed hawkish risk re-introduced to the policy path.”



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US equities pare recent losses after mixed inflation print 

Donovan Choy

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Sony launched its much-acclaimed Soneium L2 blockchain yesterday. It had a somewhat rocky start.



Built atop the OP Stack, <a href="https://blockworks.co/news/sony-astar-ethereum-rollup-soneium">Soneium</a> is a joint venture launch by Sony Group and Startale Group. The latter previously launched the Astar Network L1 and the Astar L2 zkEVM.



Soneium’s “Minato” testnet began in August 2024 and drew over 1,700 applicants to its Spark <a href="https://soneium.org/en/blog/meet-the-winners-of-soneium-spark-incubation/">incubator</a>, while garnering 47 million transactions over 14 million active wallets.



What’s placed Soneium in the Crypto Twitter limelight, however, are calls for the chain’s sequencer-level censorship.



Memecoins launched on the chain yesterday, such as AIBO, traded to a $2.7 million market cap high 13 hours after launch before being <a href="https://x.com/PopPunkOnChain/status/1879066023875482041">censored</a> by Soneium’s sequencer and blocked on the chain’s block explorer (<a href="https://en.wikipedia.org/wiki/AIBO">AIBO</a> is a Sony-developed robotic dog from the 90s).



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXeQEw6lUDVuA1cftl1_rmmWvfbgph5shdyru9Hdk3ztFmXl6Ate2rH3P248zjg2xVGspONLMzbC-kp0noNxIXvPGfGCaxKPnc5pkVqBbthv_3_-9rsvDXSMzLY0we02tL_YeT6ZkQ?key=gEzTklHsJ6ULa1ZFDIZ1_3_f" alt=""/><figcaption class="wp-element-caption">Source: <a href="https://soneium.blockscout.com/token/0x5EebdC6bc22b64888BF8c448cd67b2AEEae4Aedd">Blockscout</a></figcaption></figure>



Surprised? You shouldn’t be. According to Soneium’s <a href="https://docs.soneium.org/docs/ip-and-contracts-restriction">docs</a>, the chain already planned a tiered restriction system to protect intellectual property rights. This system flags potential intellectual property violations and will enforce blocks at the RPC level if they’re not resolved in time:



Contract addresses on this list will have their activities restricted on Soneium, for example via RPC-level blocks, limited visibility on Block Explorer and exclusion from wallets.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXdH1Xh5p1ovmsy1ZIPUj5Xxo-0c_MzE02IHOe_TNaYtiG0QweS8dJ2vdoaQkXXfmiMuOJ_qOBR4tJfIHSfmuseGGh6rrjbWTMZ_Uc8Vp4X_SJdGTuzKznxqwNfN79qogqqZxYXBOQ?key=gEzTklHsJ6ULa1ZFDIZ1_3_f" alt=""/></figure>



It turns out, however, that L2s are more resilient than widely believed. The sequencer block backfired, as users were able to trigger a forced transaction inclusion mechanism on the Ethereum L1.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">then i go to etherscan (on L1!), to their OptimismPortal (contract used to send L1-&gt;L2 msgs), and craft a depositTransaction with such calldata. i want to call the exchange contract on L2 (0xE1A&#8230;3Ab) with the appropriate value to swap and the calldata above. check the tx… <a href="https://t.co/kTcGCXwJ19">pic.twitter.com/kTcGCXwJ19</a>&mdash; donnoh.eth 💗 (@donnoh_eth) <a href="https://twitter.com/donnoh_eth/status/1879210483191783534?ref_src=twsrc%5Etfw">January 14, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



For OP Stack chains, any EOA (externally owned account) wallet can create an L2 transaction and call the main OptimismPortal contract, thereby allowing the submission of a transaction to Ethereum L1 without going through the L2’s centralized sequencer.



This mechanism is sometimes referred to by Ethereum researchers as an “<a href="https://blockworks.co/news/layer-2-secured-by-ethereum">escape hatch</a>,” an interim failsafe solution pending L2 rollups decentralizing their sequencers.



As Justin Drake put it on a previous <a href="https://youtu.be/thPIc-_h2ms?t=2531">Bankless podcast</a>, even a <a href="https://medium.com/l2beat/introducing-stages-a-framework-to-evaluate-rollups-maturity-d290bb22befe">Stage 2</a> rollup with a centralized sequencer cannot freeze or steal assets like a centralized custodian could. Real-time censorship-resistance may be compromised, but the ability to force transaction inclusions still grants some explicit level of ownership over assets on L2 chains.



Sequencer decentralization is being tackled by Ethereum researchers in a myriad of ways, such as sequencer marketplaces like Astria and Espresso, or based rollup designs that simply defer sequencing duties to L1 validators (i.e. <a href="https://blockworks.co/news/unpacking-the-based-rollups-debate">based sequencing</a>).



“Based rollups, using Ethereum’s sequencers, offer real-time censorship resistance. Unless censorship resistance is baked in, there will always be risks. While there are risks, we will never see true decentralization, permissionless and security,” Brecht Devos, co-founder and CTO of Taiko, told Blockworks.



Putting aside the thorny discussion as to whether it was right for Soneium to censor, note that this “censorship” isn’t all that different from the kinds of permissioned chains that already exist as Ethereum L2s and on Avalanche subnets.



What’s truly questionable is Soneium’s decision from a practical perspective. Trying to blacklist every intellectual property violation on a permissionless ledger is a fiendishly complex task with no end in sight.



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Sonieum launches mainnet to censorship complaints

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There are three certainties in crypto life.



Hacks, taxes and memecoins tied to every mildly interesting aspect of pop culture.



So, with social media enjoooyers in the US preparing for a potential life without TikTok, it’s no surprise that there’s already a memecoin.



The Supreme Court is <a href="https://www.axios.com/2025/01/13/tiktok-ban-timeline">currently</a> mulling a bipartisan bill passed last year that would force TikTok’s owner — the Chinese tech giant ByteDance — to sell the app to a US company by Jan. 19, citing national security concerns around influence and spying.



It was initially <a href="https://www.washingtonpost.com/technology/2024/04/24/tiktok-ban-benefits-meta-google/">thought</a> that a ban would mostly benefit Meta and Google. In the meantime though, so-called “TikTok refugees” have flooded Xiaohongshu, or RedNote, a Chinese app similar to Instagram and backed by Tencent and Alibaba.&nbsp;



On RedNote (and a number of other local apps), where there’s strict content moderation and <a href="https://www.forbes.com/sites/jasonsnyder/2025/01/14/tiktok-and-rednoteconsent-without-transparency-isnt-freedom-its-control/">censorship</a>, the default username has been “momo.”&nbsp;



Younger Chinese netizens eventually <a href="https://www.chinadaily.com.cn/a/202408/06/WS66b17c1aa3104e74fddb8a0e.html">adopted</a> the moniker, along with a <a href="https://restofworld.org/2023/social-media-privacy-momo-dinosaur/">cute pink dinosaur</a> mascot, after finding they could post more freely without using their real names online.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXepa_KG5lVIxltK_R9koaoOv1JxRn52IgRUNuUBGhyV9n1_rOKd3N4UglKROjRlGgRJIDr5pQL1Wke6XciK-DjUfpwnSs0BI8T_4BZ6Sg7rBjB4OoxnxAAZdDaObgdxw63VGHxP0g?key=jqLXOMKC5H0MIUydy2iagSQh" alt=""/></figure>



No surprise then that Solana memecoin MOMO — initially launched via pump.fun way back in October — has gone 160x in the past three days.



MOMO is still tiny, with a market cap under $5 million, and it took less than $40 million in volume to drive it to its new valuation.



Still, it’s enough for MOMO to have now returned about half that of leading AI agent coin AI16Z. AI16Z has done about 295x since its October launch, about two weeks after MOMO.



For what it’s worth, I poked around RedNote and didn’t find much crypto content beyond bitcoin and major memecoins like shiba inu (and lots of pepe).



That clearly makes the app fertile ground for the US’s fastest-growing digital export: onchain degeneracy. They simply won’t know what hit ‘em.



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TikTok’s potential US ban has already sent a Chinese memecoin 100x

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Hurricane Helene ravaged western North Carolina this fall, leading to over 100 deaths and roughly $60 billion in damage, according to a state government report.&nbsp;



As the storm worsened, Nova Labs vice president of business development Mark Phillips had an idea. Helium — which is building a network of hotspots that emit wireless coverage — could repurpose its technology to provide cell connectivity in North Carolina, where more than 20% of cell sites impacted by Helene went out of service, according to an FCC report.&nbsp;



Phillips messaged Helium Foundation CEO Abhay Kumar saying they should make a wireless hotspot for disaster relief. Within 48 hours, they had a prototype. Phillips and others at Nova Labs (which is the developer company behind the cell service company Helium Mobile) and Helium then began building the kits while also trying to get their hands on Starlink terminals that connect to the satellite-powered internet provider backed by Elon Musk.



Starlinks have an order backlog, but through a connection Phillips was able to secure 20 terminals within four days. Put together and plugged into a power source, Starlink and Helium’s tech create the “Helium hotspot beacon” — a miniature off-grid cell phone tower that uses Starlink for network backhaul and a Helium hotspot for radio connectivity to phones.&nbsp;



Helium sent a few of these beacons to North Carolina as the state’s wireless infrastructure continued to buckle. The most widely-used deployment came in Hendersonville, NC, after an organization named Land of Sky emailed asking for a beacon. They set the hardware up in a local park, and it received more than 20,000 unique connections from locals. The beacons received around 24,000 connections in total.



Because Helium hotspots provide cell service and not just Wi-Fi, anyone within 1,000 feet of the deployment had their phones automatically connect to service like with their regular carrier, Phillips told me.&nbsp;



The saga highlights a benefit of decentralized physical infrastructure, a sector referred to as DePIN in crypto circles.&nbsp;



When natural disasters strike, it is possible for legacy cell carriers to deploy mini cell towers — and America’s cell phone incumbents are <a href="https://www.lightreading.com/wireless/verizon-at-t-and-t-mobile-take-on-california-wildfires">doing</a> so amid the ongoing California wildfires. But those solutions are expensive and somewhat inflexible, requiring large trucks to drive around with little towers attached.&nbsp;



Helium offers portable kits that are plug and play for getting cell service. If deployed widely, the hotspot beacons could make America’s wireless networks much more resilient to natural disasters.



Helium has offered 10 hotspot beacon kits to the authorities in southern California, Phillips said.



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Helium’s tech provided emergency cell service during Hurricane Helene

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Yesterday I touched on the markets, but today I want to take a deeper dive ahead of the inauguration.&nbsp;



Good news is that there’s some positive data supporting the thesis that bitcoin could be in for positive momentum after Jan. 20.&nbsp;



K33 analysts noted that trading volumes are up 51% this past week, with average daily volumes coming in at $4.3 billion.&nbsp;



“Activity levels were exceptionally high amidst [Monday’s] massive flush and recovery, with spot market volumes reaching $6.5 billion, the highest daily spot volume since Dec. 20. The high volume and sharp recovery suggest many willing buyers amidst BTC’s push below $90,000, a promising observation for the road ahead,” they said.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXdFn1HvAQNvycVVlM3oKFrYHNezS1AZkuyYYBPxDp74hZ8Z_BFcTjsP-P9zrVLauO7uM2CiCE9u_6LYO8tU_SKI2VwpvR8qI6IFyQNMd0bTLRoRnKIi4IbCJmPYa4yuwwERB41ZSw?key=jqLXOMKC5H0MIUydy2iagSQh" alt=""/></figure>



Now I’m going to offer up the next bit of data without much explanation because I’m not sure we can really explain it outside of theorizing. K33 noted that Jan. 13 was the most volatile day since early December, where the gap between daily returns and intraday volatility was the “highest ever recorded in BTC.”



The easiest explanation is potential profit taking, perhaps to <a href="https://blockworks.co/news/eoy-price-updates-and-outlook">prepare for tax season</a>.&nbsp;



This leads me to this interesting nugget: “prices saw another peculiar pattern over the last week, with 14 consistent green hourly candles in a row for the first time in BTC history, making the past week unique through several lenses.”



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfGEc_yCxYjP3ScsdHZWzG18YUHgxkNq5vkDsY4tyzUGelpd9E-pdwfxISHocjsTjrCs16xq3UPS5lQvnLExGyN4p8Dtfnv9BwyHIA1lrt7w07gkx43pOj4d1lhQmORq8m33AV5rw?key=jqLXOMKC5H0MIUydy2iagSQh" alt=""/><figcaption class="wp-element-caption">From K33’s market report</figcaption></figure>



All of this could mean that Jan. 20 isn’t a sell-the-news event after all, which was a previous possibility.&nbsp;



Back in early December, K33 analyst Vetle Lunde thought we could see <a href="https://blockworks.co/news/bitcoin-100k-breakout-just-the-start">bitcoin peak on Jan. 17</a>, ahead of the inauguration, which would set it up for selling pressure as President-elect Donald Trump once again takes the oath of office.



But, to no one’s surprise, bitcoin marches to the beat of its own drum and a lot of what I’ve written and <a href="https://blockworks.co/news/bitcoin-120k-by-christmas">talked about</a> for the past month no longer matters. Don’t worry, I won’t take it personally.&nbsp;



The current setup, K33 noted, is “rigged for unpredictability” which means we all might be in for a bumpy ride over the next few days.&nbsp;



“The overall sensitivity to interest rates over the past month suggests increased importance of Wednesday&#8217;s CPI print. Additionally, notable Trump momentum may still form in the days leading into the inauguration. At current levels, we&#8217;ve rescinded our plan to sell the inauguration. However, given the plan&#8217;s price-dependent nature, a tactical de-risking could regain appeal if prices push meaningfully higher running into the inauguration,” analysts wrote.



We’re not out of the woods yet, and we should all be wary. But, hey, at least it doesn’t seem like we’re peaking yet…right?



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Price action ahead of the inauguration is ‘rigged for unpredictability:’ K33

This is a segment from the Forward Guidance newsletter. To read full editions, <a href="https://blockworks.co/newsletter/forwardguidance">subscribe</a>.



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Stock futures rose this morning before the open — a move analysts largely attribute to reports that the Trump administration will opt for a gradual approach to tariff increases.&nbsp;



Even though a better-than-expected PPI report on Tuesday helped boost equities early in the session, the S&amp;P 500 and Nasdaq Composite indexes quickly gave back these early gains.&nbsp;



But let’s rewind to the <a href="https://blockworks.co/news/unpacking-trump-potential-tariff-policies">conversation on tariffs</a>. Bloomberg after the close yesterday <a href="https://www.bloomberg.com/news/articles/2025-01-13/trump-team-studies-gradual-tariff-hikes-under-emergency-powers">reported</a> that Trump’s team is considering ramping up tariffs at a slower pace than many initially thought, potentially by 2% to 5% increases per month. Ideally, the strategy would allow for negotiations and prevent rapidly rising prices.&nbsp;



The vision aligns pretty perfectly with what Stephen Miran, Trump’s pick to lead his Council of Economic Advisors, told us on the Forward Guidance <a href="https://www.youtube.com/watch?v=65aE9KFMR3Y">podcast</a> a couple months ago.&nbsp;



Back during Trump 1.0 (2018-2019), Miran pointed out, the proposed 25% tariffs on Chinese imports did not come in one fell swoop. The actual ~17% effective rate increase we did implement on China was spread out over 12 months.&nbsp;



“The after-tariff dollar-import price of goods coming from China was practically unchanged,” Miran said on the episode. 



On the campaign trail, Trump proposed a minimum 10% to 20% tariff on all imports, and a 60% minimum rate on those coming from China. 



“In going to 60% tariffs on China or 10% globally, [a gradual] approach becomes even more important,” Miran wrote in a November 2024 <a href="https://www.hudsonbaycapital.com/documents/FG/hudsonbay/research/638199_A_Users_Guide_to_Restructuring_the_Global_Trading_System.pdf">paper</a> on the global trade system.



If history repeats, we could see similar trade policies come down the line — which are likely to ease investor concern and boost equities.



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