Trump and Milei

Olivia Capozzalo & Camila Russo
May 20, 2025

gm Defiers! Here’s what you need to know in web3 today:

The most consequential development for DeFi right now is the movement of the GENIUS Act through the halls of the U.S. Congress, and late last night crypto scored a major win. The Senate voted 66-32 to move forward with the bill, giving senators 30 additional hours for consideration before the actual vote.

The bill is one of two currently before Congress (the other is from the House), which together represent America’s first comprehensive stablecoin framework. The Senate’s bill demands 1-for-1 liquid reserves, public attestations and a ban on yield-bearing stablecoins. Clear regulations for stablecoins, which currently command almost $250 billion in market cap, or about 7% of the whole crypto market, will unlock a fresh wave of institutional and retail adoption, accelerating the transition for most payments and money transfers to happen on-chain.

But there is still an orange-hued elephant in the room. In the most recent proposed changes to bill, which Democrats and Republication negotiated on before yesterday's vote, “both regular and special government employees” (Elon Musk was explicitly mentioned) would be held to the same financial conflict of interest standards. But the apparent exemption for the president still leaves room for questions around the Trump-family-backed World Liberty Financial “USD1” stablecoin — a sticking point for Sen. Elizabeth Warren and others.

It gets even muddier when considering USD1 was chosen as the stablecoin for Abu Dhabi’s AI investment firm to pour $2 billion into Binance. Unsurprisingly, it’s a sticking point for Warren and the dwindling crypto army. Ultimately, though, rationality prevailed and the promise of domestically regulated dollars on-chain proved to be louder.

South of the equator, another pen was busy. With one signature, President Javier Milei dissolved the special task-force that had spent the past three months untangling the LIBRA memecoin scandal — a probe that was inching uncomfortably close to the Casa Rosada and to Milei’s influential sister, Karina.

Decree 332/2025 declares that the unit “fulfilled its purpose,” after forwarding its files to prosecutors, yet no final report ever saw daylight. Investors left holding 98 percent losses on a once-$4.5 billion FDV token will have to settle for faith in Argentina’s courts. Many complaints remain with federal prosecutors and Congress is weighing its own inquiry, so judicial scrutiny continues despite the task-force shutdown.

Milei and Trump are from different nationalities but speak the same language: memes, and a rush for the adoring masses who will buy tokens and NFTs at the sight of one tweet. Both men frame crypto (and rightly so) as sovereign self-defense: for Argentines, a lifeboat away from peso weakness and chronic fiscal imbalance; for the MAGA nation, an end to a corrupt and decaying banking system that privileges insiders.

Yet yesterday’s moves expose the cost of personality-driven monetary experiments. When oversight threatens the leader’s brands, probes are shuttered and loopholes are penciled in.

The takeaway with GENIUS is that it may give stablecoins the regulatory clarity the industry’s begged for, but it also picks winners. Meanwhile LIBRA ended in a presidential decree that hides more than it reveals. In both hemispheres, the message is the same: decentralization can move markets, but centralization still writes tomorrow’s rulebook.

With love,

Cami, The Defiant founder

✍️ In today’s newsletter:

• Markets are mostly flat
• Aave is the largest DeFi protocol by TVL
• The U.S. Senate moves forward on the GENIUS Act
• DeFi protocol Bancor sues Uniswap
• Genesis sues its parent company DCG

Read more below!

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• Stellar Network Aims to Become Top 10 DeFi Chain

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Soul is a cross-chain lending protocol aggregator that unifies liquidity across lending protocols, offering seamless access to the best borrowing and lending rates across ecosystems. Users can supply assets on one protocol and borrow against them on another, optimizing yield strategies without bridging assets.

USD₮0 is live on Flare — the omnichain version of USDT, backed 1:1 and built for seamless cross-chain movement. With Kraken supporting USD₮0, earn top-tier APY on Flare now.

Maple celebrates surpassing $1b in TVL by giving away $500k USDC in rewards. There are multiple prizes up for grabs with a $300k grand prize for SyrupUSDC depositors.

This is the news that mattered in the past 24 hrs:

1. The cryptocurrency market posted mild losses today, as geopolitical tensions between the U.S. and China resurfaced. But both ETH and BTC spot ETFs saw inflows on Monday.
2. With over $24 billion in TVL, Aave has become the #1 DeFi protocol by total value locked, taking up 20% of total DeFi TVL.
3. After a failed attempt earlier this month, yesterday evening the U.S. Senate voted to move forward on its stablecoin bill, the GENIUS Act.
4. DeFi protocol Bancor is suing Uniswap, accusing the firm of copying key technology used in DEXs.
5. Crypto lender Genesis is suing its parent company, Digital Currency Group (DCG), and DCG CEO Barry Silbert, seeking to recover over $3.1 billion.

🎬WATCH

In our latest podcast, we interview Shaw Walters, the founder of Eliza Labs, one of the biggest projects at the intersection of crypto and AI.

We talk AI, but Shaw also talks passionately about why the current financial system is broken — “immoral” even — and how crypto can help us break free. But only if we manage to move past the casino phase. Give it a listen, it’s a heated one.

SPONSORED POST

DeFi is evolving rapidly and maturing, entering a new phase of adoption and growth. With both established protocols like Aave and new entrants driving innovation in capital efficiency and market design. However, liquidity fragmentation across chains and protocols remains a core limitation, particularly in the lending sector. Soul’s new DeFi primitive addresses this by enabling cross-chain lending coordination, using LayerZero’s messaging infrastructure to allow users to borrow across chains and protocols while keeping collateral in one place. Built by the team behind Hatom, a 2 years old secure and mature lending protocol, Soul aims to become a foundational layer in a new phase of interoperable and composable DeFi.

READ MORE: Solving major DeFi problems: Soul new primitive to finally solve liquidity fragmentation

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