senftinger

I believe self custody of assets with private keys is legitimately one of the most powerful tools for sovereignty we have ever devised but the industry has completely bastardized this term to the point of uselessness. The original notion (in my mind at least) of self custody was having a string of letters and numbers or 12 words that unlock your assets. “Self-custody” when interacting with smart contracts and defi has become virtually meaningless at this point, encumbering coins with layers and layers of risks and dependencies, incredibly misleading A lot of this narrative was ostensibly for regulatory reasons: “we don’t take custody of your assets, you deposit them in this pool or contract with self-executing code” but that’s so obviously not true at this point it’s an insult to our lived experience. Or, if it is “true” in the literal sense that the code technically always does what it is allowed to do, the “self-custody” component is very far down the list of what is actually important with these systems, a red herring really. Clearly Drift depositors didn’t (don’t) have “self-custody” of their funds. And the common retort is “well Drift doesn’t really either.” ok but North Korea does now. At this point I liken self-custody in the context of defi to saying that you are the only one with the keys to the front door of a bank vault but there’s another door on the other side of the vault that criminals (or regulators, who knows) can enter with impunity and take your assets. Is it really that relevant that you’re the only one with a key to the front door? The reason this is jading is because truly securing your wealth with private keys if you choose is a 0 to 1 unlock for some people (maybe the only real 0 to 1 unlock in this space) but that was conflated with all of these systems that have multisigs, upgrade keys, oracle dependencies, layers upon layers, turtles all the way down, often times with very obvious single points of failure. What is the value of self custody when a multisig can reorg your assets out of existence? The whole thing is very disillusioning

🚨 JUST IN: Former PayPal CEO David Marcus just unveiled a stablecoin banking product for businesses and AI agents. Stablecoin balances. Yield. Payments. Cards. All chain-native, all behind an API. This is Banking-as-a-Service but onchain. --- Banking-as-a-Service is getting rebuilt on stablecoin rails. The old stack - Middleware (e.g. Unit / Synctera) - Galileo - FBO accounts at a sponsor bank There's now a chain-native version. - Squads Grid does it on Solana. - Bridge built it for fintechs, payroll and non banks - BVNK ships it embedded. Lightspark now joins them, with distribution into 65 countries and a Bitcoin L2 underneath. --- I keep thinking about how the "account" itself is being unbundled. What used to be a sub-ledger entry at a partner bank becomes a programmable smart account that holds dollars, settles 24/7, keeps its own yield, issues cards, and accepts agent-scoped permissions. The bank charter turns into a feature you plug in for accessing other rails. --- The agent piece is marketing, but its also more than that. Lightspark is already inside Google's AP2 protocol. As agents want to become platforms in their own right, re-sell financial services to their customers, they'd want a BaaS like thing. Why not go for something that uses stablecoins? --- Marcus has THE most fascinating back story - Former CEO of PayPal, has moved money traditionally - Behind Libra at Meta a global bank account and "stablecoin" that regulators pushed back on. Now this is a global stablecoin bank account distributed through an API, post-GENIUS Act, sold to businesses and machines. Sometimes timing is everthing. Does this compliment or commoditize BaaS over time? I expect the answer becomes obvious within 18 months.

if you are becoming sarcastic about this industry you are right, but you are also wrong. big time. the timeline after the rsETH hack somehow touched on every single thing that is exciting and fascinating about crypto. having been on the other side of a lazarus hack with safe during bybit, i watched this one with a very specific kind of attention. first off, the obscurity of rsETH itself. i did not know re-staking was still a thing. go to literally any person outside right now and try to explain to them what this asset is and why it exists. they will offer you treatment, not investment. absolute meta levels of financial alchemy. yet: hundreds of millions. allocators behind this are either insane, genius, or achieving some kind of 4d chess tax gymnastics through exposure to a finance matryoshka. then the bridge protocol layered on top. trying to analyze "layerzero bridged rseth on arbitrum" is a DDoS on any kind of risk framework. Error 503. the level of layered grey zones exceeds anything any analysis can parse in a way that still makes sense. whatsoever. decentralization in any of this? censorship resistance? let's call it: early stages. it's all as decentralized as necessary and as centralized as possible. regulators are simply not going to follow you into the jungle of financial, social, legal and technical engineering at play here. that's a factor of practicality, not of affirmation. what do we do? accept it as collateral for permissionless lending. of course. this is insane. but it is also genius. maybe accidentally genius. but still genius. it is exactly the kind of frontier thinking we need. how else are we going to find out if we don't fuck around? this is science. test it, break it, fix it. i'll come back to that. we all know what happened next. the 1-of-1 bridge got poisoned. lending facility drained. lenders rekt. almost 300M gone in under an hour. turns out the dprk is deeper into the defi stack than most defi users. kim's guys knew what "dvn" is. not many others did. kino. then the whole thing detonates. the spiderman meme. kelp pointing at layerzero. layerzero pointing at kelp. "you used a 1-of-1 config." "it was YOUR default config." now it gets interesting. look around. watch closely. learn. who steps up when it gets serious? who is in it for the finding out and who is just along for the fucking around? turns out at this point we are not only testing smart contracts, protocols and mechanisms. we are testing people. who you can trust. and how to know. seal-911 showed up. this financial system has communist hacker villains, yes. but it also has a badass avengers team. arbitrum froze funds. stani put 5k eth of his own money on the table. not a governance proposal. money. lido, etherfi, golem, bgd labs, mantle, community members. over 100M pooled in days. defi literally united. let's not get romantic. most actors had direct exposure. the system made the damage legible, the exposure obvious, and the coordination rational. incredible, but rational. in days. without a court order. the underlying eth? still there. accounting broke, not collateral. onchain balance sheets meant everyone could see exactly what broke and what was intact. people showed up with real money to fix it. in public. with names on it. there is no global chapter 11 for a lending pool. the law hasn't caught up and it may never. so some incredibly courageous people just looked at the gap and filled it. action first, insight second, regulation third. always has been. test it, break it, fix it. all three happened in one week. proof of work. spacex doesn't get to rockets that land by simulating in a lab. they get there by launching, exploding, and fixing. live. the explosion is the method. we are building a global financial system on open rails. modular stack. complex, novel, obvious risk. root access for everyone. we are not there yet. but this week we got closer. and the ones still building after another blowup? godspeed. 🫡

If you're building a business on top of Claude right now, you're building on quicksand. I say this as someone who did exactly that.

Total raised by these chains (Berachain, Celestia, Eclipse, Sonic, Story, Scroll, and Sei): ~ $613 million. Total 24h revenue: ~ $1,568 This is a huge issue for crypto What went wrong ?

Stablecoins are not better money They're a much better payments rail