_Synthquest🐸📊

🚨 BREAKING: Senator Lummis says CLARITY Act markup expected by Easter, Senate approval targeted by end of April.

Welcome to the Ethereum Economic Zone (EEZ), a framework for synchronously composable rollups. What does that mean? One deployment. Shared liquidity. Single transactions across L1 & L2. Identity verified anywhere. Smart wallets connected everywhere. No additional trust assumptions. This means L2s that are as credibly neutral, economically aligned, and publicly governed as the base layer itself. EEZ furthers Ethereum as the leading decentralized economy.

New in Claude Code: auto mode. Instead of approving every file write and bash command, or skipping permissions entirely, auto mode lets Claude make permission decisions on your behalf. Safeguards check each action before it runs.

It’s time for Curation 2.0. The curator model was a big advancement, but there are some commonsense enhancements that can result in a better product for users. Tranching is back in vogue lately. I think I’ve had at least three teams reach out to me about tranching design. Where there are three, there are likely more, so I’m going to share my advice publicly. First, let’s understand how challenging it is to tranche an evergreen vehicle like a Morpho or Euler vault. People have to be able to withdraw at some point - there’s no winding down date where all the books are balanced and gains/losses distributed. This means you have to prevent junior tranche participants from collecting their outsized yield, then leaving ahead of senior creditors, upending the intended distribution of losses. MakerDAO/Sky ran into this very problem with the 2024 ConsolFreight default where the junior creditor was monitoring the investment better and exited ahead of a default, leaving Maker holding the bag. Eventually it was written down after a residual recovery. So adding a tranche where a curator is in the junior position is helpful, but the mechanics matter a lot. Some commonsense options to add tranches to curator vaults thoughtfully: * Permanent capital from the curator is locked in the vault. This cannot be withdrawn until the vault winds down. This prevents early exit when the curator (who is better placed to spot problems than anyone else) sees things going sideways on a Sunday evening. * Subordination ratios should be enforced. For example, if there must be 20% of the pool in the junior tranche, no new deposits are accepted into the senior position until more junior can be found. Similarly, junior cannot withdraw at all unless there is at least 20% of the pool in the junior position. This ensures that junior creditors cannot exit before bearing losses they were paid to take. * Junior withdrawal limits should be in place. These could be a maximum amount or a time lock on junior withdrawals (even if in the intended subordination range) * Adding new collaterals requires the consent of a majority of the deposit base. This prevents the risk profile from migrating unexpectedly. For example, if you deposited into a vault that’s lending only to blue chips, you should not wake up to find it now allocates to loans against fartcoin. * Curator fee cannot be increased without the consent of a majority of the deposit base. This prevents curators from growing their AUM with a low or on-market rate and then raising it abruptly with minimal communication. There are other, more complex things that could be added, but some combination of these features overlaid onto Morpho and Euler and even Aave and Compound (who are themselves really just curators with different parameter sets) would be an easy way to build more robust lending and products for HNWIs and institutions. It also helps ensure vaults behave in a way that depositors and borrowers expect. If anyone wants this built, or is even building this now, my DMs are open. But moving full speed ahead with better credit and credit-like products is really important so that DeFi can continue to grow and become more competitive with alternatives.

These Resolv guys are straight-up clowns 🤡 Looks like the “exploiter” was basically an insider — probably some engineer who knew exactly how sloppy their security was. Total damage by now: ~11,318 ETH (~$23.8M), now just chilling on this address: 0x8ed8cf0c1c531c1b20848e78f1cb32fa5b99b81c What’s even funnier — the exploiter casually spent 4 HOURS swapping wstUSR into USDC/USDT, patiently waiting for traders to buy the depeg back up lol (and even now keep swapping). On top of that, they kept abusing the mint bug multiple times over several hours. Team must’ve been on weekend mode with laptops fully closed. Either way, no shot they’re covering a $23.8M hole. But the real comedy is how they handled the situation (spoiler: as badly as possible). At this point, only a full reboot could justify holding USR. RIP RESOLV 💀

🇺🇸SEN. LUMMIS: “WE THINK WE’VE GOT IT” Senator Cynthia Lummis says the crypto market structure bill could clear committee by late April and pass the Senate by year-end. “We think we’ve got it,” she said, citing a compromise on stablecoin yield.

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