Blockchains scaled—and then splintered. Liquidity scattered across L2s, bridges kept breaking, and “data availability” turned into the new bottleneck. Avail wants to solve all three at once. Founded to deliver verifiable, scalable data availability, the project now positions itself as a full-stack unification layer: a DA base, Nexus for proof-based interoperability, and Fusion for shared security that can restake ETH, BTC, and rollup tokens. The thesis is simple but ambitious: developers should build once and scale everywhere; users shouldn’t have to think about chains at all.

In this CryptoSlate Q&A, Avail co-founder Anurag Arjun walks us through how that thesis is moving from roadmap to reality. We start with a real-world stress test: Sophon’s $60 million node sale, which extended Avail’s light client to production scale and hinted at new, verifiable fundraising primitives for app-specific chains. From there, we dig into EnigmaDA—encrypted data availability designed to meet institutional privacy mandates without re-introducing trusted intermediaries—along with how banks and TradFi pilots can reconcile encryption, key management, and auditability on-chain.

Interoperability is the other pillar. Rather than another bridge, Nexus promises “one SDK, nine chains, no network switching,” aiming to route flows across multichain stablecoin and DeFi liquidity while minimizing replay and quorum risks with TEE and ZK verification. On the user side, Avail’s light client targets <1 MB/s bandwidth and runs on phones and browsers via data-availability sampling and validity proofs—pushing “a full node in your pocket” toward emerging markets.

We also explore the speed-vs-decentralization trade-offs behind TurboDA’s 250 ms pre-confirmations and the team’s “infinity blocks” research goal of 10 GB blocks in ~600 ms; the validator-set growth path from 105 validators and a Nakamoto coefficient of 34; and what Avail is learning from flagship deployments like Lens Chain (650k profiles) and Sophon. With 50+ integrations in the queue, Arjun outlines how Avail triages partners for technical fit, ecosystem value, and compliance—plus how community growth (600k+ members in year one) is anchored in builder activity rather than vanity metrics.

If Avail is right, the next phase of crypto won’t be “L2 vs. L2” but app-centric rollups speaking a common, proof-based language—privacy-aware when needed, credibly neutral by design, and finally usable at internet scale. Read on for the full conversation.

The following article is a guest post and opinion of Prabal Banerjee (Co-founder of Avail) and Shailey Singh (Marketing Manager and Researcher at Avail)

Imagine a world where you walk into a bank and apply for a $1 million loan. Instead of handing over your full income history and credit report, you generate a cryptographic proof confirming you meet every loan criterion without exposing actual numbers or documents. The bank verifies the proof instantly. No raw data changes hands. No paper trail for hackers to follow.

Today, for a financial institution to verify a fact—whether it’s a customer’s loan eligibility or proof of compliance—it must reveal every underlying piece of data, including sensitive personal information. That data lives in centralized systems, secured by or shared with third parties, creating an ever-expanding attack surface.

This is the paradox at the heart of modern finance: compliance demands disclosure, but disclosure erodes privacy and security. Zero-knowledge technology flips that script.

In a world of mounting cyber threats, regulatory scrutiny, and customer fatigue, zero-knowledge proofs (ZKPs) offer a better model for trust: verifiable, privacy-preserving, and future-ready. ZKPs let one party (the prover) convince another (the verifier) that a statement is true, without revealing why or exposing the underlying data.

Integrating ZK technology into traditional finance may seem futuristic, but the truth is, we need it now.

A Surge in Cyber Risk

Data privacy and security go hand in hand. The financial sector is under siege. In 2024, the average cost of a data breach for banks and insurers skyrocketed to $6.08 million—about 22% higher than the $4.88 million cross-industry average. Companies take an average of 168 days to detect and 51 more to contain these breaches, prolonging operational chaos and reputational damage.

In 2023, the financial industry accounted for 27% of all data breaches handled by Kroll—more than any other sector. These aren’t outliers; they’re bleeding-edge trends that cut into profits and erode public trust. Consider Equifax, which lost over $5 billion in market cap and 13% stock value after its 2017 breach; or Bank of America’s vendor-related breach that exposed the records of 7.6 million customers, prompting forensic investigations and intensified regulatory scrutiny.

Compliance Overload

Regulatory demands have outpaced legacy infrastructure. In the United States, Dodd‑Frank and SOX require firms to disclose detailed or near-real-time compliance data.

Europe’s MiCA adds granular reporting for crypto companies. Firms face nonstop exposure, rising complexity, and compliance fatigue. The result: bloated tech stacks, siloed data, and mounting vulnerability under constant internal and external scrutiny.

Banks Demand More Personal Data

Banks and fintechs are asking users to surrender increasing amounts of personal data: documents, income history, even biometric data, just to get started. Customer acquisition has become a leak-prone liability.

A 2023 Fenergo study found 67% of banks have lost potential clients due to clunky KYC and onboarding. Banks contact new customers an average of 10 times during onboarding, requesting countless documents, costing around $128 per customer and seeing an average 18% abandonment rate, per a 2024 report. These data-hungry paths are alienating users while making institutions data-rich and danger-rich.

Zero-Knowledge Tech: Proof Without Exposure

Zero-knowledge proofs change this calculus. ZKPs are built on decades of cryptographic research. Foundational work by researchers like Shafi Goldwasser, Silvio Micali, Oded Goldreich, Amit Sahai, and others laid the groundwork for modern zero-knowledge systems, defining both their theoretical limits and practical designs. Today, ZKPs have moved from mathematical concepts to real-world tools.

Under the hood, zero-knowledge systems rely on advanced cryptography to generate compact, verifiable proofs. No raw data ever needs to be revealed. Rules and inputs are programmatically smart-contract encoded, the proof is generated without exposing the underlying data, and the verifier receives a tamper-proof cryptographic assurance that all conditions were satisfied.

Recent breakthroughs have made these proofs fast enough for real-time use and efficient enough to scale across high-volume financial systems.

After the collapse of crypto giants like FTX, proving reserves became a top priority for crypto firms, especially exchanges. Centralized exchanges like Kraken, Gate.io, and OKX have already proven reserves without exposing sensitive details.

Traditional banks can adopt similar mechanisms to prove Basel III compliance or liquidity thresholds without ever leaking proprietary risk models.

Some already have. In 2023, Société Générale Forge explored zero-knowledge technology to enhance confidentiality in digital bond issuance (fully subscribed by AXA Investments and Generali Investments) on Ethereum L1. In March 2024, the European Banking Authority began exploring ZKPs as part of its digital compliance toolkit. Singapore’s MAS has also funded ZK-based pilots for cross-border data privacy.

The other important aspect is scale. Interbank markets process trillions daily, but most require full disclosure for settlement—from counterparties to trade details. ZK-rollups can batch thousands of trades into a single proof, offering near-instant finality without revealing anything other than what needs to be proved.

Why Now? Tech + Timing

Zero-knowledge proofs aren’t new. But what is new is that they’re finally fast, scalable, and accessible.

Proof generation speed has improved dramatically in the past two years alone. With zk-SNARKs and zk-STARKs, proofs can now be generated in seconds and verified in milliseconds—even for complex financial computations. Developers are advancing ZK tech in the context of rollup architecture acceleration, with Ethereum’s rollup-centric vision.

Tooling has matured as well. Today, developers can plug into open-source libraries like Halo2, PLONK, or zkVMs with real-world use cases. Platforms like Polygon, zkSync, StarkWare, and Scroll are already deploying ZK-powered financial apps.

Legacy institutions may face challenges in upgrading entrenched infrastructure, aligning with regulatory frameworks, building internal cryptography domain expertise, and educating teams. But these limitations are shrinking fast.

Today, the pieces are in place. The time to act is now.

Those who move early will set new standards. The new model of trust is “verify, never reveal.” Early adopters will set the standard and win the clients.

Mentioned in this article

Meme coins are known for hype, volatility, and short lifespans. But Little Pepe ($LILPEPE) is trying to rewrite that narrative.

With over $16M raised across multiple presale stages, the project is building more than a token – it’s launching its own Layer 2 blockchain for meme coins, complete with zero-tax trading, bot protection, and a fully integrated launchpad for new projects.

As speculation rages across the meme coin sector, Little Pepe is positioning itself as the infrastructure that future meme tokens can rely on – offering fast, secure, and low-cost transactions on a blockchain purpose-built for virality.

Little Pepe Story So Far – Viral From Birth

Little Pepe came out swinging, with strong presale momentum as soon as it launched.

• Stage 1: Sold out in 3 days – $500K raised at $0.001 per token
• Stage 2: Price bumped to $0.0011-$0.0015, demand increased – $1.23M+ raised
• Stage 3: Token price rose to $0.0012
• Stage 4: The presale raised $2.9M
• Stage 5: Price is at $0.0014, and the raise is over $5.1M

Fast-forward a bit, and the presale now sits at Stage 9. Tokens cost $0.0019 – and over $16.3M has poured into the presale so far. Why all the interest?

Most meme coins are just ERC-20 tokens. Little Pepe is building the chain those meme coins will want to launch on.

Most of the best meme coins ride the Ethereum or Solana wave, but both chains come with major downsides: high gas fees, slow confirmations, and vulnerable bot manipulation. Little Pepe’s Layer 2 directly addresses these pain points:

• Ultra-low gas fees for cheaper trading and better access for retail users
• Fast finality means no more waiting for confirmations during hype moments
• Bot protection provides built-in anti-sniping and fairer launches

That said, Little Pepe is EVM-compatible, so existing dApps and token contracts can migrate seamlessly.

Tokenomics support the presale, with over 26% reserved directly for the presale and another 30% kept for on-chain reserves.

Real Utility – A Launchpad Built for Meme Coin Creators

At the heart of Little Pepe’s ecosystem is Pepe’s Pump Pad, a user-friendly launchpad designed to make deploying new meme coins effortless and secure. Bypass the fuss of Ethereum launches and setting up smart contracts.

With the Pump Pad, users can create tokens without writing a single line of code, lock liquidity automatically, and integrate default smart contract security measures.

The system also includes built-in bot protection and allows for instant deployment on Little Pepe’s high-speed Layer 2 blockchain. Little Pepe’s Pump Pad gives meme coin creators a safe, streamlined platform to launch without losing any of that distinctive meme coin flair..

What’s Next for Little Pepe?

Little Pepe’s development roadmap follows a quirky but clear trajectory: Pregnancy, Birth, and Growth.

The current phase – Pregnancy – focuses on presale fundraising and community building. The upcoming Birth phase will introduce major exchange listings, first on DEXs, then expanding to CEXs as soon as possible. The Birth phase will also see an expanded marketing campaign.

The final phase – Growth – will see the launch of the full Layer 2 blockchain and the rollout of ecosystem tools and partner integrations. After the presale concludes, users will be able to claim their tokens directly via the official website.

Little Pepe enforces a zero-tax policy, meaning no buy or sell fees – a rare move in the meme coin space that encourages frequent and frictionless trading on-chain.

The $777K Giveaway: How to Enter

What’s one reason for all the buzz around Little Pepe? A massive $777K giveaway.

A total of 10 winners will receive $77K each in $LILPEPE tokens.

Entering is simple: participants must purchase at least $100 worth of tokens during the presale and complete social media engagement tasks – such as following and sharing content on X and Telegram.

The more actions a participant completes, the higher their chances of winning one of the coveted $77K prizes.

Little Pepe – Born to Run

In a sea of copy-paste meme coins, Little Pepe is building real infrastructure. From its Ethereum-compatible Layer 2 chain to its one-click launchpad and zero-tax trading model, the project looks to transform the meme coin meta in 2025 and beyond.

To join the presale, connect your MetaMask or Trust Wallet to the presale website. Buy $LILPEPE with $ETH or $USDT (ERC-20). You can also pay with a card through the official Little Pepe website.

With over $16M raised and presale prices still under $0.0020, $LILPEPE might be one of the few frog tokens with real legs.

Do your own research – this isn’t financial advice.

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AI is evolving at breakneck speed, with autonomous agents now capable of analyzing markets, diagnosing diseases, writing code and making hiring decisions.

But as capabilities grow, so does a more profound unease – who governs these agents, and by what rules?

A handful of corporations are controlling access, performance and alignment. This centralization of intelligence data raises suspicions and a lack of trust.

Trust in AI (artificial intelligence) is not just about whether it works. It’s about who controls it, how it evolves and whether its behavior can be audited, questioned or improved.

In a centralized system, those questions are answered, if at all, behind closed doors.

Blockchain and Web 3.0 technologies offer a compelling alternative – decentralization as a design principle.

Rather than trusting a company, we verify the system. Rather than relying on goodwill, we rely on protocol.

The trust problem in centralized AI

The black-box nature of proprietary AI models limits transparency. Their training data, optimization strategies and update cycles are opaque.

Worse, these models often operate in high-stakes environments, making decisions that affect people’s finances, health or rights.

Without a clear understanding of how these decisions are made, trust becomes blind.

There’s also the concentration of infrastructure. The compute resources, data pipelines and deployment channels for advanced AI are primarily housed in private data centers.

This creates points of failure and reinforces a power imbalance, where end users become passive consumers of intelligence they cannot shape or interrogate.

Incentive structures compound the issue. Traditional AI development lacks mechanisms to reward verifiable contributions or penalize harmful behavior.

An agent that misbehaves suffers no cost unless its owner intervenes, and that owner may prioritize profitability over ethics.

What blockchain brings to the table

Blockchain offers a trustless architecture where AI systems can be governed, audited and incentivized in transparent, programmable ways.

One of the most profound shifts it enables is the ability to embed accountability directly into the AI stack.

Reputation becomes quantifiable. For instance, ABTs (AgentBound Tokens) are non-transferable cryptographic credentials proposed to track an AI agent’s conduct.

If an agent wants to perform high-stakes actions, it must stake its reputation. Misbehavior results in slashing, while good performance reinforces its credibility.

This creates economic alignment between the agent’s incentives and human expectations.

Blockchain also introduces auditability – by recording data origin, training history and decision logs on-chain, stakeholders can verify how and why a model made a particular choice.

Equally important is infrastructure decentralization. AI today is bottlenecked by the physical and economic constraints of centralized data centers.

With the rise of DePIN and decentralized storage systems like IPFS, AI workloads can be distributed across global participants.

This reduces costs, increases resilience and also breaks the monopoly over who gets to build, train and deploy models.

Multi-agent systems need shared rails

Autonomous agents are not isolated entities – increasingly, they must interact, whether to coordinate logistics, pricing services or optimize supply chains.

Without shared protocols and interoperable standards, these agents remain confined within their silos, unable to compose or collaborate.

Public blockchains provide the rails for agent-to-agent coordination. Smart contracts allow agents to make enforceable agreements. Tokenized incentives align behavior across networks.

A marketplace of services emerges where agents can buy compute, sell data and negotiate outcomes – without relying on centralized intermediaries.

Today, we can see prototyped ecosystem frameworks where agents operate semi-independently, staking tokens, verifying each other’s outputs and transacting based on shared economic logic.

It’s an overlay network for machine coordination, native to the internet.

Federated learning without a central brain

Training AI collaboratively across different parties without pooling sensitive data is a major frontier.

FL (federated learning) allows this by keeping data local and sharing only model updates.

But most FL implementations still rely on a central server to coordinate aggregation – a potential choke point and attack surface.

DFL (decentralized federated learning) removes this middleman.

With blockchain as the coordination layer, updates can be shared peer-to-peer, verified through consensus and logged immutably.

Each participant contributes to a collective model without ceding control or privacy.

Tokens incentivize high-quality updates and penalize poisoning attempts, ensuring the integrity of the training process.

This architecture is well-suited for healthcare, finance or any domain where data sensitivity is paramount and stakeholder plurality is essential.

Risks and trade-offs of on-chain AI

No system is without its challenges. Blockchain brings latency and throughput constraints that may limit its use in real-time AI systems.

Governance tokens can be manipulated, and poorly designed incentive schemes might create perverse behavior.

On-chain logic – once deployed – is challenging to change, posing risks if flaws go unnoticed.

There are also security concerns. If an AI relies on on-chain oracles or coordination, an attack on the underlying blockchain could cascade into AI behavior.

Moreover, reputation systems like ABTs require robust Sybil resistance and privacy safeguards to prevent manipulation.

These are not reasons to avoid blockchain – but they highlight the need for careful design, formal verification and a commitment to continuous refinement.

A new social contract for AI

At its core, blockchain gives AI a governance substrate – a way to encode norms, distribute power and reward alignment.

It reframes the question of ‘who controls the AI’ into ‘how is control encoded, executed and verified?’

This matters even more politically than technically. AI development without decentralization will likely go from open experimentation to corporate consolidation.

Blockchain offers a chance to build intelligent systems as public goods, not proprietary assets.

The challenge is to fuse the technical layers, data, model, incentive and control into a coherent stack.

But the path is visible – open protocols, transparent incentives and decentralized oversight. AI doesn’t just need blockchain for infrastructure. It needs it for legitimacy.

In a world of autonomous agents, trust can’t be a byproduct – it must be engineered. Blockchain gives us the tools to do precisely that.

Roman Melnyk is the chief marketing officer at DeXe.

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Tether has announced it will wind down USDT on five lesser-used blockchains after usage on those networks wanes.

Redemptions and token minting on Omni Layer, Bitcoin Cash’s Simple Ledger Protocol, Kusama, EOS, and Algorand are set to stop on Sept. 1, 2025. Remaining tokens are to be frozen on the same day, according to a statement.

Together, the five networks carry only a sliver of USDT’s roughly $156 billion float. Tether says the usage of USDT on these networks, which it touts as playing a role in the firm’s early growth, has declined “significantly” over the past two years.

“Sunsetting support for these legacy chains allows us to focus on platforms that offer greater scalability, developer activity, and community engagement — all key components for driving the next wave of stablecoin adoption,” Tether CEO Paolo Ardoino said in the statement.

The firm will redirect its focus to Layer 2 networks such as the Lightning Network and to newer blockchains that promise faster settlement and richer developer tooling.

Tether has asked its customers holding USDT on the five networks to redeem their holdings as soon as possible or request issuance of their tokens on a supported blockchain. Token holders can migrate their tokens through blockchain bridges or exchanges.

The lion’s share of Tether’s $156 billion fiat is currently circulating on Tron and Ethereum, which together make up over 95% of the total. Solana is the only other network with more than 1% of USDT’s supply in circulation, according to RWA.xyz data.

January 17th Is Bitcoin Layer 2 the future of adopting BTC?

Explosion of resources of interest and development resources

The Bitcoin Layer 2 (L2) protocol has gained some traction through the introduction of standards and runes. Due to the divisive nature of the community around some of these unconventional ways to introduce tokens, or even smart contracts to Bitcoin through things like ordinals, many interests and investments have begun to focus on better ways to add additional features to Bitcoin via Bitcoin L2. L2.Watch, a website that tracks projects working on Bitcoin L2 development, is currently tracking 86 different projects working on Bitcoin L2 in some way.

These L2 solutions aim to introduce features such as tokenization, decentralized finance (DEFI), staking, and smart contracts, while addressing the limitations of Bitcoin’s scalability. These Layer 2 protocols aim to implement these improvements in a more strategic way than the controversial implementations pioneered by runes and ordinals that drew criticism from parts of the Bitcoin community. Unlike Ethereum and Solana, Bitcoin’s core protocols resist frequent changes and make Layer 2 technology an essential path for innovation without compromising the underlying security of Bitcoin. This rapidly growing interest paves the way for diverse L2 projects to explore asset issuance, decentralized exchanges (DEXS), impossible tokens (NFTs), and decentralized autonomous organizations (DAOs).

The most notable L2 implementations include rollups, sidechains, and state channels. Rollups such as optimistic zero-knowledge (ZK) rollups allow off-chain transaction batches while locking summary data into the main chain, thereby increasing throughput and reduction fees. Sidechains such as RSK and Liquid operate in parallel with Bitcoin, allowing for features such as asset issuance and Turing Complete Smart Contract. Meanwhile, state channels promote near-internal and cost-effective off-chain transactions, making them ideal for microtransactions and everyday payments. Each of these solutions extends Bitcoin utility and provides developers with a broader canvas for creating decentralized applications (DAPP).

Projects such as Sovryn, Stacks, and RGB illustrate the diversity within the Bitcoin L2 ecosystem. Sovryn focuses on Defi and offers RSK lending and borrowing. Stacks introduces smart contracts and DAPP via proof of transfer mechanisms and utilizes Bitcoin for payments. RGB allows for token issuance and confidential smart contracts while maintaining full compatibility with the Lightning network. Additionally, new protocols such as Rollkit and BITVM are examining the rollup framework and virtual machine capabilities, respectively, further expanding the capabilities of Bitcoin to handle complex financial products and programmable logic.

The rise of Bitcoin L2 highlights the significant evolution of the digital asset space, where Bitcoin is moving from a static store of value to a dynamic platform that can support advanced blockchain capabilities. By leveraging the L2 solution, Bitcoin can compete with Ethereum and other platforms in DEFI and Web3 Arenas, while maintaining core principles of decentralization and security. This development not only diversifies the utility of Bitcoin, but it could also promote a more comprehensive ecosystem and promote wider adoption and innovation across the blockchain industry.

Bitcoin L2 is the determinant of true mass adoption

Bitcoin L2 solutions are essential to achieving mass adoption as they address the inherent scalability and feature limitations of Bitcoin. The basic layer of Bitcoin is excellent at security and decentralization, but it only processes around 7 transactions per second, making it unsuitable for the vast number of transactions required for global adoption as reserve currency or everyday P2P digital cash. L2 protocols such as rollup, sidechain, and state channels significantly enhance Bitcoin throughput by processing transactions off-chaining and sedimenting them into batches of main chains. This approach reduces crowds, lowers transaction fees, and allows users around the world to access Bitcoin, from small retail payments to large institutional transfers.

Scalability is important to achieving the possibility that Bitcoin is an alternative payment platform, and the L2 solution provides a means to achieve it without compromising security. With technology like Lightning networks that promote instant micropayments and rollups that batch and compress transaction data, Bitcoin can support large numbers of transactions. These advancements are important in areas where high fees and slow processing times are hampered by financial inclusion. By reducing costs and increasing efficiency, L2 solutions pave the way for Bitcoin to be practical and used as a universal medium of exchange in both the development economy and developing countries.

Beyond scalability, the L2 protocol brings Web3 features to Bitcoin, such as tokenization, Defi, NFT, and DAO. These features allow Bitcoin to enable smart contracts, establish DEXS, and enable a directly distributed P2P lending platform on the Bitcoin network. These features allow Bitcoin to compete with platforms like Ethereum, while maintaining an unparalleled reputation for security and reliability. By integrating Web3 applications, Bitcoin L2 can develop a decentralized financial ecosystem. This is essential to attract developers, businesses, and users looking for alternative financial systems.

Many believe that Bitcoin needs to address a diverse range of use cases to achieve its potential as a new global reserve currency and a peer-to-peer digital cash system. L2 Technology is the bridge that connects the secure foundation of Bitcoin to the dynamic, scalable, programmable world of Web3. These enable seamless cross-border payments, scalable transaction processing, and decentralized application development, making Bitcoin more versatile and user-friendly. In this evolving financial environment, Bitcoin L2 is the key to unlocking public adoption and establishing Bitcoin as the cornerstone of a decentralized global economy.

Can Digital Gold still compete (or should it be) in the Web3 world?

Bitcoin has established itself as “sound money” and “digital gold” that prioritize security, decentralization and value preservation. This focus is the basis of the cryptocurrency market, but it limits functionality compared to Web3-centric platforms such as Ethereum and other EVM compatible chains. These chains, including Solana, Avalanche and Binance Smart chains, are dedicated to scalability, low rates, and running smart contracts, and can control Defi, Tokenisation and DAO. As a result, Bitcoin’s more conservative design has raised questions about its ability to compete in the rapidly expanding Web3 space.

The emergence of Bitcoin’s L2 ecosystem with innovations such as Lightning networks, rollups and sidechains such as RSK and Liquid provides a potential route for Bitcoin to fill this gap. These solutions provide scalability and programmability without changing the Bitcoin base layer, allowing them to support tokenization, DAPP, and other Web3 trust minimization features. However, it remains uncertain whether these technologies will level the arena with Ethereum and other optimized Web3 chains. Bitcoin’s strength lies in its unparalleled security and decentralization, but L2’s efforts must prove that it can provide comparable Web3 capabilities without sacrificing these core principles.

One important question is whether Bitcoin should aim to compete directly with the Web3 chain or focus on its existing role as a valuable, secure, decentralized reservoir. By pursuing Web3 capabilities, Bitcoin will dilute its identity and risk competing in busy areas where other chains are technically suited to running scalability and smart contracts. Meanwhile, Bitcoin’s reputation and network effects allow L2 solutions to be placed as a safe alternative for users and developers who pay attention to the trade-offs associated with a more centralized Web3 chain.

Ultimately, Bitcoin’s competitive future in Web3 will depend on whether its L2 ecosystem can balance its enhanced capabilities with Bitcoin’s core strengths. If successful, Bitcoin could evolve into a hybrid system that offers both the principles of sound money and the broader utility. However, there is also the risk that L2 efforts may not achieve sufficient traction. It suggests that Bitcoin’s most effective path is to doubling its role as a global reserve currency and P2P digital cash with the UNIX spirit of “doing one thing and doing well.”

]]> https://earlybirdsinvest.com/is-bitcoin-layer-2-the-future-of-adopting-btc/feed/ 0 46458 https://earlybirdsinvest.com/ethereum-touted-as-foundational-layer-for-global-finance-by-firm-with-500m-eth-bet/ https://earlybirdsinvest.com/ethereum-touted-as-foundational-layer-for-global-finance-by-firm-with-500m-eth-bet/#respond Sat, 05 Jul 2025 22:31:34 +0000 https://earlybirdsinvest.com/ethereum-touted-as-foundational-layer-for-global-finance-by-firm-with-500m-eth-bet/

At the time of writing, Ether

is trading at around $2,505, up 0.56% in the past 24-hours, according to CoinDesk Research’s technical analysis model. As for the broader crypto market as gauged by the CoinDesk 20 Index (CD20), it is up 0.34% during the same period.

SharpLink Gaming, Inc. (SBET) is a pioneering online performance marketing company specializing in the sports betting and iGaming industries. Headquartered in Minneapolis, SharpLink leverages its AI-powered C4 platform to deliver personalized, data-driven marketing content that enhances customer acquisition and retention for sportsbook and casino operators. The company has expanded through strategic acquisitions and partnerships, establishing itself as a leader in the evolving sports betting ecosystem.

On July 4, 2025, SharpLink announced on X that it has become the first publicly listed company to adopt ETH as its primary treasury reserve asset. The company outlined a comprehensive treasury strategy focused on accumulating ETH, staking it, and growing ETH-per-share to create long-term shareholder value.

SharpLink emphasized that its goal is not just to hold ETH but to actively deploy it through native staking, restaking, and Ethereum-based yield strategies. The company highlighted ETH’s advantages as a corporate reserve asset: it is productive via staking rewards, composable across decentralized finance protocols, scarce, secure, and aligned with the infrastructure of the future internet. This approach represents a bold redefinition of traditional treasury management, integrating decentralized finance principles into corporate finance.

This strategic pivot began with a $425 million private placement announced on May 27, led by Consensys and other prominent crypto investors, to fund the acquisition of ETH as SharpLink’s primary treasury asset. Joseph Lubin, Ethereum co-founder and founder of Consensys, joined SharpLink’s Board of Directors as Chairman upon closing this placement, reinforcing the company’s commitment to blockchain innovation.

Since officially launching its ETH treasury strategy on June 2, SharpLink has aggressively expanded its Ethereum holdings. Between May 30 and June 12, 2025, the company acquired approximately 176,271 ETH for about $463 million at an average price of $2,626 per ETH.

Following this, from June 16 to June 20, SharpLink purchased an additional 12,207 ETH for roughly $30.7 million, funded in part by $27.7 million raised through At-The-Market (ATM) equity sales.

By June 24, SharpLink’s ETH holdings reached 188,478 ETH, with 100% of these reserves deployed in staking solutions generating staking rewards. And by July 1, the treasury expanded further to 198,478 ETH, yielding over 220 ETH in staking rewards since the strategy’s inception.

Joseph Lubin has stated that embedding Ethereum at the core of SharpLink’s capital strategy embodies technological progress and institutional trust, positioning the company to lead the evolution of digital commerce. Meanwhile, CEO Rob Phythian has noted that SharpLink’s upcoming Nasdaq closing bell ceremony on July 7, 2025, will symbolize this new chapter, showcasing how digital assets can coexist with public market discipline and corporate governance.

SharpLink’s Ethereum treasury strategy uniquely positions the company at the crossroads of sports betting, blockchain technology, and decentralized finance, offering investors regulated and transparent exposure to Ethereum’s growth potential while advancing SharpLink’s mission to innovate the multi-billion-dollar iGaming industry.

Technical Analysis Highlights

• ETH gained 2.2% from July 4 15:00 to July 5 14:00, climbing from $2,475.48 to $2,530.02.
• A sharp sell-off between 13:06 and 14:05 pushed ETH down to $2,514.85 before buyers stepped in.
• Strong support formed between $2,480 and $2,500 during the July 5 16:00 hour, with 382,821 ETH traded.
• A bullish breakout on July 4 at 22:00 lifted ETH above $2,520, with resistance confirmed near $2,530.
• ETH consolidated around $2,515 with signs of reduced volatility and an ascending recovery trendline after 13:40.
• Momentum remains neutral short-term but structurally bullish given broader uptrend since late June.

Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk’s full AI Policy.

The following is a guest post and opinion of Neil Mullins, CEO at Mojito 

Web3 gaming is growing rapidly, but loyalty systems haven’t kept pace. In the last year, blockchain gaming didn’t just grow: it leveled up.

According to the 2024 DappRadar Games Report, the space hit 7.4 million daily active wallets and added over 1,600 new games. Total gaming activity nearly quintupled compared to the end of 2023 as new users, ecosystems, and experiments poured in.

But growth is only half the story. Retention and community engagement remain a grind. Many games are stuck with loyalty systems that feel bolted on or are missing entirely. As gaming becomes more cross-platform, social, and community-driven, loyalty needs to catch up—fast.

A new wave of Web3-native loyalty programs suggests that change is finally arriving.

What Traditional Loyalty Gets Wrong

In gaming ecosystems today, loyalty is little more than a leaderboard, a daily bonus, or a half-baked points system. These tools feel increasingly out of step with how players actually engage.

According to Mistplay’s 2024 Mobile Gaming Spender Report, 79% of mobile spenders actively engage with loyalty programs, and 51% say they would spend more in-game if loyalty rewards offered more value.

Progression, not perks, is the real incentive. Players want loyalty systems that recognize the time and effort they invest.

The same story shows up outside gaming, too. Research from Boston Consulting Group shows that participatory loyalty programs drive sustained engagement. In gaming, players expect similar depth and flexibility, yet many games still rely on static rewards or platform-locked perks.

Consumer research platform Attest has highlighted this gap:

• 69% of U.S. gamers aged 18–24 say cross-platform play is important. Loyalty systems must extend beyond individual games or platforms.
• One-third of gamers find in-game ads intrusive and actively ignore them. A loyalty model based on value will outperform one based on ads.
• Friends and family recommendations remain the top driver for trying new games. Loyalty can amplify this effect through community-based rewards.

At the same time, the broader industry is being forced to rethink its engagement strategies. In 2024, more than 12,000 gaming jobs were lost as studios faced rising costs and diminishing returns on user acquisition.

As IGN reported, many teams are now prioritizing sustainable retention over growth at all costs. Loyalty programs, battle passes, and live service models are emerging as key tools to monetize and strengthen existing player communities.

Yet traditional tools aren’t built for this new, community-first world of gaming. That’s why a growing number of Web3 projects and gaming ventures are exploring new models.

Where Web3 Loyalty is Emerging

A new generation of games and platforms is turning to on-chain loyalty programs as a way to meet modern player expectations. The primary features of these systems include composable rewards, wallet-native ownership, and enhanced community engagement.

Take Decentraland’s new Marketplace Credits system, for example. It offers players credits just for showing up and exploring, attending events, checking out new locations, and more.

Those credits can be traded in for avatar upgrades such as wearables and emotes. It’s a simple way to turn everyday participation into a loyalty loop that keeps players coming back.

Mastercard’s Gamer Exchange is another sign of where things are headed. It lets players convert loyalty points from banks, retailers, and airlines into in-game currency across top titles, providing proof that even legacy brands know loyalty is becoming a battleground for gaming.

Infrastructure is also evolving. Mojito Loyalty enables brands and projects to integrate on-chain loyalty features (quests, rewards, and community progression) directly into gaming and digital experiences.

Meanwhile, games like Forgotten Runiverse are using play-to-earn mechanics and evolving loyalty programs to build more persistent player economies. Their approach hints at what’s possible when loyalty is treated not as a marketing add-on but as a core part of the player experience.

Across these examples, the pattern is clear: when loyalty is participatory, transparent, and portable, it becomes a driver of engagement rather than an afterthought.

Loyalty Will Be Gaming’s Next Layer

Retention curves alone won’t build sustainable gaming communities. As John Wright, VP of Mobile Publishing at Kwalee, has said: “It’s not about going for Day 7, 14, and 28 retention curves. Companies must construct a new kind of loyalty system that will bring players back for a year.”

On-chain loyalty makes that shift possible. It allows developers to reward the entire player experience, rather than just what happens inside the game—encompassing everything players contribute, such as attending events, creating content, building community, and more.

Loyalty transforms scattered actions into tangible progress that players can see and feel. And as gaming moves toward open economies and cross-platform identities, it isn’t just nice to have; it’s becoming a new, essential layer of the gaming stack.

Mentioned in this article

The state chain is the original second-layer protocol originally developed by Ruben Somsen in 2018, in response to the ELTOO (or LN symmetry) proposal. In 2021, the original proposal, Mercury variant was built by CommerceBlock. In 2024, further iterations of the original mercury scheme constructed the mercury layer.

The Statechain protocol is a little more complicated to discuss compared to other systems such as ARK and Lightning, as there is a range of possible variations between the original proposed design, the two actually implemented, and the other possible designs that are loosely proposed.

Like ARK, state chains rely on centralized tuning servers to function. Unlike the Ark, they have a slightly different trust model from the vutxo of the Ark Batch. They rely on coordination servers to remove stocks of previously generated private keys for unreliable maintenance, but as long as the server follows defined protocols and does so, they provide strong security assurances.

The general idea of ​​state chains is that ownership of the entire UTXO can be transferred between different users between different users, facilitated by the coordinator. You don’t need a requirement to receive liquidity such as lightning or a coordinator server to provide liquidity such as ARK.

First, let’s look at the original protocol proposed by Ruben Somsen.

Original state chain

State chains are effectively pre-signed transactions, allowing current owners to withdraw on-chain with chains whenever they need them, and signed messages encrypted that they had sent their status with past owners and approved their transfer.

The original design was built on Eltoo using anyPrevout, but the current plan on how to enable the same feature is to use CheckTemplateVerify and CheckksigFromStack (a high-level explanation of this can be found at the end of the CheckSigfromStack article). The basic idea is not related to using a single specific UTXO, but a script that has that script and allows pre-signed transactions to use UTXO that locks the right amount of Bitcoin.

In the protocol, users who want to deposit coins into the stach chain approach the coordinator server and pass the deposit protocol. Deposit user Bob generates a key he owns, but also generates a second “temporary” key that will eventually be shared (more on this). You then create a deposit transaction that locks the coin into a multi-sign, and need a coordinator key and a temporary key to sign.

Using this multisig, Bob and the Coordinator use the coin to sign transactions that create UTXOs that can be used by other transactions signed by the transiter key and coordinator key using LN symmetry. Bob is now able to fund Multisig for the right amount, and the state chain has been created.

To transfer the state chain to Charlie, Bob must go through a multi-stage process. First, Bob signs the message with his unique private key, proof that he will forward his status to Charlie. Charlie also needs to sign a message proof that he received the state chain from Bob. Finally, the coordinator server must sign a new transaction, allowing Charlie to unilaterally claim the stator chain on chain before Charlie sends a temporary copy of the key to Charlie.

All of these are made atomic using adapter signatures. These are signatures that are modified in such a way using random data that is invalidated, but can be re-enabled when the signature owner receives that information. All messages, as well as new pre-signed transactions, are signed with adapter signatures and are simultaneously enabled atomically through the release of adapter data.

The holder of the state chain must trust that the coordinator server will not conspire with the previous owner to sign an immediate closure of funds from the current owner, but a pre-signed chain of messages can prove that the coordinator has participated in the theft if he does so. If a past owner attempts to steal funds using a pre-signed transaction, a time lock on the spending pass using only keys allows the current owner to submit a pre-signed transaction and correctly claim the funds for the chain.

Mercury and mercury layer

The original StateChain architecture requires a soft fork to work. CommerceBlock designed a status variant to work without SoftFork, but that resulted in a trade-off in terms of functionality.

The basic idea is the same as the original design, with all users holding pre-signed transactions allowing them to unilaterally claim their own funds, and the coordinator server plays a role in facilitating off-chain transfers where they need to trust to behave honestly. The big difference between the two is that they are given how these transactions are signed and the structure of pre-signed transaction users.

For signatures, there is no longer a temporary private key that users will pass to the user. Instead of this, a multi-party computing protocol (MPC) is used, allowing the original owner and coordinator server to jointly generate a partial portion of the private key without any one having the full key. This key is used to sign a pre-signed transaction. The MPC protocol allows the current owner and coordinator to engage in a second protocol with a third party who is the recipient of the transfer. Another work It will be the same private key. With both the mercury and mercury layer protocols, after completing the transfer, the honest coordinator server removes important material corresponding to the previous owner. As long as this is complete, the coordinator will no longer be able to sign transactions with the previous owner. Because the new and important material they have is not compatible with works that their previous owners may still have. This is a stronger guarantee than the original suggestion, as long as the coordinator is honest.

Pre-signed transaction structures of mercury and mercury layers cannot use LN symmetry. This is not possible without a soft fork. Instead of this, CommerceBlock chose to use a reduced time lock. The original owner’s pre-signed transactions are time-locked to use nlocktime to go out much further in the future from the time of the creation of the StateChain. The nlocktime value of the transaction is shorter than the previous owner, as each subsequent user receives a status during transfer. This ensures that the previous owner cannot even submit a transaction on-chain before the current owner can, but at some point the current owner will ultimately end up with the current owner Must do Close the state chain on-chain before the previous owner’s transactions begin to take effect.

The main difference between the mercury layer and the mercury layer is how these transactions are signed. In Mercury, the coordinator server verifies that the transaction is proposed, validates it before signing it. Mercury Layer uses a blind signature protocol. This means that the details of the transaction you are signing are not actually displayed. This allows you to verify that the server tracking status requires a special authorization key from the current owner using anonymized records on the server and that you are signing only valid forwarding.

Synergistic effects with other groups

The state chain can be synergized with other Layer 2 based on pre-signed transactions. For example, some of the original proposals suggested a combination of status and Lightning channels. Both are simply pre-signed transactions, so you can actually nest lightning channels above the state chain. This requires that the unilateral exit key of the current owner is multisig and requires creating a pre-signed transaction to output to the lightning channel. This allows you to open and close the lightning bolts, completely closing them with chains.

In a similar way, it is possible to nest the stach chain over vutxo in an arc batch. This requires the pre-signed transactions needed to build the state chain and requires Vutxo output to be spent.

I’ll summarize

The state chain is not completely trusted, but is a very liquid-efficient, highly trust minimization scheme that allows UTXOS to be freely transferred off-chained among users who are willing to embrace the trust model of the state chain.

The original proposal has not yet been built, but the two implementations designed by CommerceBlock are fully implemented. Neither achieved anything beyond the limits of use in the real world. This is whether users don’t want to accept the trust model involved, or simply whether marketing or recognition failures are completely unseen.

Anyway, if LN symmetry is possible with Bitcoin, this is always here, given that there are two complete implementations and designs for more flexible variation. The good thing about open source software is that if you choose in the future, it’s always there, whether people are using it now or not.