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Top Stories This Week

Ethereum Foundation Restructures, Ethlabs Spins Out

The Ethereum Foundation announced it was cutting roughly 20% of its staff and slashing its budget by 40% Monday, its most sweeping reorganization in years. Interim leadership released an execution plan focused on MEV elimination, default user privacy, and paying contributors in ETH rather than fiat.

The same morning, five former EF researchers launched Ethlabs, a separate non-profit R&D lab for consensus, cryptography, and execution-layer research. Funders told The Defiant by Tuesday that Ethlabs would overlap deliberately with the EF and was designed to pull from its "densest talent." Ethereum now has two non-profits steering its R&D; the question for the next cycle is whether they converge on a shared roadmap or drift into parallel tracks.

CBDC Ban Clears Congress, Then Stalls at the White House

The Senate passed a housing bill containing a Fed CBDC ban through 2030 in an 85-5 vote Monday, one of the widest bipartisan margins a crypto-adjacent bill has cleared. Congress sent the bill to Trump. Trump then blocked the signing, demanding voter ID provisions be added first. The CBDC ban is now stalled on an unrelated political fight.

The CLARITY Act kept moving in parallel. The White House is negotiating an ethics deal with Senate Democrats to advance the market-structure bill. Senator Lummis set July as the floor vote deadline, telling JPMorgan's CEO to read the bill. The House scheduled a July field hearing. Opposition came from an unexpected corner: nearly 100 Catholic leaders filed opposition over trafficking safeguard provisions.

Strategy's Meltdown

Strategy's stock fell below $100 for the first time since 2024 as analysts picked apart its leveraged Bitcoin bet. STRC preferred shares hit record lows and slipped below par by week's end. A securities probe landed on the company Friday, and executives issued coordinated investor reassurances on the way down.

The week's collapse puts the leveraged-BTC-treasury playbook, which dozens of companies replicated from Strategy, under its sharpest stress test yet.

Prediction Markets: Fake Bets, Meta's Arena, and Kalshi's $40B Bid

The week opened with the Wall Street Journal reporting $1.9 million in fake bets had propped up Polymarket creator videos. By Friday, bipartisan senators were pressing the CFTC to disclose whether it was investigating. Zuckerberg ordered Meta to build a standalone prediction market app codenamed Arena and urged it to explore direct partnerships with Polymarket and Kalshi. The CFTC sued Kentucky to defend its exclusive jurisdiction over prediction markets, its ninth such action. Kalshi said it was seeking a $40 billion valuation, seven weeks after closing at $22 billion.

The Senate fight over CFTC authority split along party lines by week's end: 17 Democratic senators moved to bar the CFTC from funding its state-level prediction market lawsuits, pushing back against the same agency that some of their colleagues were simultaneously pressing to investigate Polymarket.

Tokenized Equities: Another Layer Goes Live

Ondo Finance launched 24/7 minting and redemption for tokenized US stocks and ETFs on Ethereum, making round-the-clock settlement available on a major platform for the first time. Securitize announced it would go public on NYSE on July 2 through a $400 million SPAC merger. Baillie Gifford launched a UK-regulated tokenized bond fund on Solana and Ethereum with BNY. StablecoinX began Nasdaq trading as the first public ENA treasury vehicle. And Canton Network topped blockchain fee rankings at $60 million over 30 days, ahead of Tron and Ethereum over the same window.

Other Stories

• Magic Internet Money Falls 50% Below Peg as Abracadabra Declares Emergency: Abracadabra's MIM stablecoin collapsed to half its dollar peg Wednesday, prompting emergency governance measures and the worst depeg for a major DeFi stablecoin in months.
• Synthetix Votes to Retire sUSD, Pay Holders in Vested SNX: Synthetix governance approved retiring sUSD; co-founder Kain Warwick took personal blame for its mismanagement and laid out a basis-vault replacement path.
• Bitcoin Slips Under $60,000 as Tech Rout and Hawkish Fed Hit Crypto: BTC fell below $60,000 Wednesday as a broad equity selloff and hawkish Fed signals weighed on risk assets across the board.
• Base Suffers Two Chain Halts in 24 Hours, Complicating B20 Activation: Coinbase's Base Layer 2 went offline twice in 24 hours on Friday, with the second halt complicating the timing of the B20 network activation window.
• Binance Tells EU Users It Will Wind Down Services as MiCA Deadline Hits: Binance notified EU customers it was winding down as Europe's MiCA licensing deadline arrived, after withdrawing its Greece application and targeting a new EU jurisdiction earlier in the week.
• Spark, Uniswap, and Sky Launch $150M Stablecoin FX Migration on Uniswap V4: Three major DeFi protocols launched a coordinated $150 million liquidity migration to build a shared stablecoin FX layer on Uniswap V4.
• Aave's Kulechov Disputes Report Claiming Firm Would Sell AAVE at 70% Discount: Aave founder Stani Kulechov publicly denied a report claiming the protocol was considering selling AAVE governance tokens at a 70% discount to fund operations.
• BitGo Cuts Nearly 15% of Staff Six Months After IPO: BitGo laid off roughly 15% of its workforce and said it was refocusing on stablecoins and AI, six months after going public.
• THORChain Resumes Trading After Month-Long Halt From $10.7M Exploit: THORChain reopened for trading after a month-long suspension following a $10.7 million exploit, with governance debate still ongoing over the pace of recovery.
• Invesco Files for Tokenized Stablecoin-Reserve Money Market Fund on Superstate Rails: Invesco filed to launch a tokenized money market fund holding stablecoin reserves, built on Superstate's onchain infrastructure.
• Chainlink Launches Project Pangea With 50 Banks Across 16 Countries for T+0 FX Settlement: Chainlink brought more than 50 banks across 16 countries onto a network targeting same-day foreign exchange settlement, one of the largest institutional deployments of onchain FX infrastructure to date.
• Ripple Launches RLUSD in Japan as Circle and Nomura Join Stablecoin Race: Ripple launched RLUSD in Japan via SBI VC Trade as Circle and Nomura announced their own stablecoin partnerships, opening a three-way race for Japan's regulated stablecoin market.

That's it for today. Have a great weekend! If you enjoyed this newsletter, tell your friends!