Did Base Go Too Far? Jesse Pollak Responds

Hi! In today’s edition:

• 🧵 Base boss defends ‘Coin It’ post

• 🔒 eXch to shut down amid Bybit hack fallout

• 🧹 Kraken sheds workers as IPO looms

• 🧱 Converge targets ultra-fast block times

• 💡 Eliza’s new AI agent builder debuts

The Financial Freedom Report explores the role currency and banking play in the civil liberties and human rights struggles of those living under authoritarian regimes and how Bitcoin is used to push back.

Base Head Jesse Pollak Responds to the Backlash Around the ‘Coin It’ Experiment

On Wednesday, Coinbase’s layer 2 network, Base, posted on X: “Base is for everyone.” It followed that with another post: “Coined it.” The second post linked to a page on which the post had already been turned into a coin.

Within an hour, the coin hit a $17 million market cap, then dropped to under $2 million, then went back up to top $13 million. Crypto X exploded. 

Some called it a rug. Others accused insiders of sniping the launch. 

Coinbase later issued a statement saying that Zora auto-tokenizes content, but Jesse Pollak, head of Base, posted on X that he had personally greenlit the post.

So what really happened?

In this episode, Jesse sits down with Laura to discuss:

• Whether the token was a memecoin launch or a media experiment

• Why he thinks the crypto community overreacted

• Whether insider trading occurred

• And why he believes coins, not NFTs, are the future of creator monetization

Plus, he explains why he’s okay being the “punching bag.” 

Listen to the episode on Apple Podcasts, Spotify, Pods, Fountain, Podcast Addict, Pocket Casts, Amazon Music, or on your favorite podcast platform.

Crypto Exchange eXch to Shut Down

Crypto exchange eXch announced on Thursday that it will cease operations on May 1, following allegations that it was used to launder funds from a $1.4. billion hack targeting Bybit earlier this year.

Specifically, eXch was accused of being privy to North Korea’s Lazarus Group laundering around $35 million through its platform.

EXch initially denied involvement in laundering the Bybit funds, but later admitted to processing an “insignificant portion” of the stolen assets, describing the matter as an isolated incident.

EXch’s management cited an “active transatlantic operation” aimed at “forcibly shutting” the exchange down as it became the target of potential criminal charges and signals intelligence surveillance.

“The goals we certainly never had in mind were to enable illicit activities such as money laundering or terrorism, as we are being accused of now,” the eXch team said.

“We also have absolutely no motivation to operate a project where we are viewed as criminals,” they said. “This doesn't make any sense to us.”

Kraken Lays Off Hundreds Ahead of IPO: Report

Crypto exchange Kraken has laid off hundreds of employees across all parts of its business over the past several months as part of a wide-ranging effort to streamline operations ahead of a planned initial public offering, according to a report by CoinDesk that cited sources with inside knowledge of the matter.

A Kraken spokesperson said the firm was “making the difficult decision to eliminate certain roles and consolidate teams where redundancies exist, while continuing to hire in key areas of the business."

The layoffs are part of a rolling program that began with a 15% workforce reduction affecting around 400 staff last October, shortly after Arjun Sethi was appointed as the exchange’s co-CEO alongside Dave Ripley.

In an October blog post, Sethi and Ripley said Kraken had fallen into “the trap of building organizational layers” as the firm grew north of $1 billion in net revenue.

Ethena and Securitize Unveil Roadmap for New Blockchain ‘Converge’

Ethena Labs, creator of the USDe synthetic dollar, and Securitize, a heavy-hitter in real-world asset tokenization, on Thursday shared a preliminary roadmap for a new blockchain named Converge.

Converge will launch with a native block time of 100 milliseconds, targeting a reduction to 50 milliseconds by the fourth quarter of this year. The network aims for a throughput of at least one gigagas (billions of gas units per second) within the year, pushing the boundaries for Ethereum virtual machine-based chains.

The Converge architecture will leverage Arbitrum for execution and Celestia for modular data availability, enabling high throughput and low-latency transactions.

Security will be anchored by the Converge Validator Network, which will be secured by staked ENA, Ethena’s native token.

“Bringing onchain finance to global markets with Ethena and Securitize assets requires an equally ambitious tech roadmap purpose built for institutions,” Ethena Labs said in an X post.

We will release an episode about Converge today at 11 a.m. ET. Stay tuned!

Eliza Labs Launches No-Code AI Agent Platform Auto.fun

Eliza Labs has launched a no-code artificial intelligence agent platform designed to “democratize” the creation, deployment, and monetization of autonomous AI agents for Web3 applications.

Users can design and launch complex AI agents by simply describing tasks in natural language, using commands such as “Find me the best staking opportunities with at least 12% APY,” and automatically allocate funds.

The platform is built on the open-source elizaOS protocol and boasts a token launch mechanism inspired by Pump.fun that Eliza Labs describes as "fairer than fair."

Each agent will have its own token, launched via a bonding curve model — an approach that allows projects to acquire up to 50% of their token allocation before public market listing, reducing the risk of bot-driven sniping and ensuring more equitable distribution.

• 🗳️ Galaxy Research on Thursday proposed a new Solana governance mechanism named MESA, allowing validators to vote across a range of deflation options and produce a weighted average inflation rate, aiming to overcome gridlock from a failed binary vote on lowering SOL emissions (about which you can learn more here).

• ⚡ Ethereum’s restaking protocol, EigenLayer, activated its long-awaited slashing feature on Thursday, enforcing penalties on malicious operators for the first time and fulfilling its security model aims after growing to over $7 billion in restaked assets.

• 🏦 Hidden Road said on Thursday that it had secured a U.S. broker-dealer license from the Financial Industry Regulatory Authority self-regulatory body, clearing a key hurdle to expand its fixed-income prime brokerage services ahead of its pending $1.25 billion acquisition by Ripple.

• 🚀 Coinbase boosted its Solana infrastructure, improving block throughput by 5x and remote procedure call speed 4x, after record-high transaction volumes triggered delays and user complaints earlier this year.

• 🖼️ Billionaire music and movie mogul David Geffen filed a countersuit against Justin Sun this week over a $78 million sculpture, alleging that Sun had fabricated a fraudulent ownership claim after being unable to flip the artwork amid crypto losses and reputational setbacks.

• 💸 LayerZero’s ZRO token jumped 10% after a16z acquired $55 million worth under a three-year lock-up, reinforcing confidence in the cross-chain messaging protocol, which now connects 125 blockchains and underpins $75 billion in transfers.

1. Cointelegraph: Manta founder details attempted Zoom hack by Lazarus that used very real ‘legit faces’

2. DL News: How $131m ETF inflows stabilised Bitcoin’s price