Weekly Crypto Recap (March 17th - March 23d)

Mindshare Weekly Recap
 

Sonic Introduces High-Yield Algorithmic Stablecoin Amid Terra-Luna Flashbacks

Background – Sonic has announced the development of a high-yield algorithmic stablecoin offering up to 23% APR, drawing parallels with the ill-fated Terra-Luna collapse of 2022 that triggered massive losses and regulatory backlash.

Key Points

• Sonic’s new stablecoin promises a yield of up to 23.5% APR at $100M TVL, according to co-founder Andre Cronje, with potential scalability up to $1B TVL.
• Cronje admitted the team “cracked algo stablecoins” but expressed concern due to past PTSD from Terra’s collapse.
• The news comes nearly three years after TerraUSD (UST) lost its peg, erasing $40B+ in value and collapsing its sister token LUNA by over 98%.
• Sonic promotes itself as the fastest EVM chain, achieving 720ms finality, and recently saw its TVL rise 66% to $253M post-rebrand from Fantom.

Key Takeaway – Sonic’s push into algorithmic stablecoins revives concerns over systemic risks in DeFi, as the industry still grapples with the Terra fallout and tightens regulation against such models.

Tornado Cash Ported to MegaETH Testnet After U.S. Treasury Lifts Sanctions

Background – A developer has ported the Tornado Cash protocol to the MegaETH testnet just as the U.S. Treasury removed the original protocol and associated addresses from its sanctions list, reigniting debate around privacy tools in crypto.

Key Points

• Developer “Gunboats” deployed Tornado Cash on MegaETH, a new blockchain claiming 20,000 TPS, calling the ported version ETHTornado.
• The move follows a Treasury decision to remove Tornado Cash wallets from the OFAC SDN sanctions list, after a court ruling in January.
• Gunboats noted the process required no code changes, using the deprecated Truffle framework, and saw the action partly as a joke.
• Concerns over wallet “dusting” persist, despite OFAC’s removal, as many projects still exclude such wallets from airdrops.
• MegaETH community members welcomed the deployment, though Gunboats confirmed it has seen limited use due to lack of a frontend.

Key Takeaway – The reappearance of Tornado Cash on a high-speed testnet reflects ongoing tensions between privacy innovation and regulatory scrutiny, even as U.S. sanctions policy shifts.

Trader Nets $480K with 1,500x Return Before BNB Memecoin BUBB Crashes 50%

Background – An anonymous trader turned $304 into $482K on BUBB, a newly launched BNB-chain memecoin, just before its price crashed over 50%, prompting renewed insider trading accusations in a memecoin market already shaken by recent rug pulls.

Key Points

• The trader bought 43.94M $BUBB for $304, selling 28.9M for $122K and holding $360K worth, achieving a 1,586x return in under 24 hours.
• BUBB’s market cap plunged from $43.7M to $22.6M shortly after the sale, as seen on Dexscreener.
• A comment from Binance’s Yi He on a BUBB post sparked speculation of a listing, fueling hype.
• The incident follows a pattern: similar suspicions surrounded the collapse of WOLF (down 99%) and Libra, which wiped $4B in market cap after insiders exited.
• DWF Labs reports call for stronger safeguards for memecoins tied to public figures, including liquidity locks and anti-bot measures to prevent manipulation.

Key Takeaway – The $BUBB case highlights the persistent risks of insider activity in memecoin markets, as explosive gains by anonymous wallets continue to erode investor trust and trigger calls for better protection mechanisms.

Haun Ventures Targets $1B for New Crypto Funds, Expects Oversubscription

Background – Crypto-focused VC firm Haun Ventures is aiming to raise $1 billion across two new funds, signaling renewed institutional appetite despite more cautious market conditions compared to its record-breaking $1.5B raise in 2022.

Key Points

• $500M will go to early-stage crypto, and another $500M to late-stage investments, with fundraising expected to close by June 2025.
• The firm, founded by Katie Haun, is reportedly scaling back from 2022's $1.5B round due to a changed market environment.
• Despite the lower target, Haun Ventures expects the new funds to be oversubscribed, showing strong interest from LPs.
• The move follows large raises by Paradigm ($850M) and Pantera Capital (targeting $1B+), as VC activity in crypto ramps up again.
• Haun recently backed Bitwise in a $70M round, while industry predictions highlight stablecoins as a key VC focus in 2025.

Key Takeaway – Haun Ventures' $1B target underscores growing confidence in the crypto VC space, even as firms take a more measured approach compared to the exuberance of the last bull cycle.

Real-World Asset Protocols Surpass $10B in TVL Amid Tokenization Surge

Background – Real-world asset (RWA) protocols have crossed $10.2 billion in total value locked (TVL), as tokenizing traditional financial instruments like T-bills and real estate gains momentum within the Web3 ecosystem.

Key Points

• RWA TVL now totals $10.216B across 79 DeFi platforms, with Maker RWA ($1.3B), BlackRock BUIDL ($1.23B), and Ethena USDtb ($1.18B) leading the sector.
• VanEck predicts RWAs could exceed $50B in market cap by end of 2025, signaling strong institutional interest in asset tokenization.
• BUIDL and USDtb are backed by money-market fund shares, while Maker RWA includes tokenized real estate and treasury bonds.
• Ethena USDtb's TVL grew 1,000% in the past month, as investors turn to stablecoin-backed RWA products amid crypto market volatility.
• Other notable funds include Franklin Templeton’s BENJI and Ondo’s OUSG, which also tokenize treasury-backed assets.

Key Takeaway – The surge in RWA protocol adoption reflects growing demand for on-chain exposure to traditional assets, positioning tokenization as a key bridge between DeFi and legacy finance.

MegaETH Launches Public Testnet, Claims Speeds Beyond Base and Monad

Background – Ethereum L2 MegaETH has launched its public testnet, showcasing ultra-high throughput and speed, with ambitions to become the fastest DeFi chain on the market.

Key Points

• MegaETH boasts 10ms block times, 20,000 TPS, and 1.7 Ggas/sec throughput, claiming performance 50x faster than Base.
• The testnet launched with 16 live apps out of 29, including DEXs GTE, Vault, and gaming projects like Awe.
• Testnet tokens were airdropped to nearly 200,000 wallets in just 15 seconds, enabling instant access to the ecosystem.
• The roadmap includes parallelized architecture upgrades targeting a further 30x throughput boost.
• Backed by Vitalik Buterin, Joseph Lubin, and $43M in funding, including recent rounds via Echo crowdfunding and NFT sales.

Key Takeaway – MegaETH is positioning itself as a serious contender in the Ethereum L2 race, combining real-time UX with massive scalability and notable backing to attract builders and users alike.

Coinbase in Talks to Acquire Derivatives Exchange Deribit for Up to $5B

Background – Coinbase is reportedly in advanced negotiations to acquire crypto derivatives giant Deribit, a move that would significantly strengthen its position in the rapidly growing crypto futures and options market.

Key Points

• Deribit is the top platform for Bitcoin and Ether options, with $1.2T in trading volume in 2023, and offers options, futures, and spot products.
• A potential deal could value Deribit at $4–5 billion, and would require regulatory clearance in Dubai, where Deribit is licensed.
• Coinbase’s derivatives trading volume skyrocketed 10,950% in 2024, and it now offers derivatives for 92 assets internationally.
• The move comes as rival Kraken acquires NinjaTrader for $1.5B, and other firms like Robinhood and CME ramp up crypto derivatives offerings.
• Coinbase recently launched the first CFTC-regulated Solana futures in the U.S., followed by CME’s own SOL futures.

Key Takeaway – As crypto derivatives gain traction with both retail and institutional players, Coinbase’s push to acquire Deribit signals a broader consolidation trend and intensifying competition in the high-growth derivatives sector.

US Treasury Department Removes Sanctions on Tornado Cash

Background – The U.S. Treasury’s Office of Foreign Assets Control (OFAC) has officially lifted sanctions on Tornado Cash, marking a pivotal legal and regulatory shift for crypto privacy tools.

Key Points

• Tornado Cash was removed from OFAC’s sanctions list, reversing restrictions imposed in 2022 over money laundering concerns.
• The move follows a court ruling in Van Loon v. Treasury, which found that sanctioning immutable smart contracts exceeded OFAC’s authority.
• Tornado Cash was originally targeted for alleged links to North Korea’s Lazarus Group and other illicit financial activity.
• The decision reignites the debate over regulatory limits, code neutrality, and the balance between privacy and compliance in DeFi.

Key Takeaway – The removal of sanctions on Tornado Cash sets a legal precedent for smart contract regulation and signals a shift in how U.S. authorities may approach decentralized protocols moving forward.

Strategy Raises $711M in Preferred Stock Sale to Expand Bitcoin Holdings

Background – Strategy (MSTR), led by Michael Saylor, has raised over $700 million in a new preferred stock offering, with the bulk of proceeds intended for additional Bitcoin purchases that will push its holdings beyond 500,000 BTC.

Key Points

• $711.2M was raised via an upsized sale of 10% Series A Perpetual Strife Preferred Stock, exceeding the original $500M target.
• The preferred stock comes with a 10% coupon and no conversion to common shares, differing from previous STRK offerings.
• Strategy currently holds over 499,200 BTC, and the new capital is expected to take its stash well above 500,000 tokens.
• MSTR shares dipped slightly in premarket to just under $300, while Bitcoin remains steady at $84K.

Key Takeaway – Strategy’s aggressive Bitcoin acquisition strategy continues with a major capital injection, further cementing its position as one of the largest corporate holders of BTC.

Total Stablecoin Market Cap Surpasses $230B Amid Institutional Growth and Trump Support

Background – The stablecoin market has hit a new milestone, surpassing $230 billion in market capitalization as regulatory momentum builds in the U.S. and institutional interest continues to rise.

Key Points

• Stablecoin market cap now stands at $230.45B, up 56% year-over-year, with $2.3B added in the last week, per DeFiLlama.
• USDT leads with 62.6% dominance ($144B), followed by USDC ($59B), as stablecoins regain levels last seen before the 2022 market crash.
• President Trump reiterated support for U.S. dollar-backed stablecoins, urging Congress to pass legislation to boost global dollar dominance.
• The GENIUS Act, a stablecoin regulation bill, has advanced in the Senate Banking Committee, aiming to enforce 1:1 backing and AML protections.
• Analysts cite growing adoption by institutions like PayPal and reduced legal barriers in the U.S. and Hong Kong as key drivers of market expansion.

Key Takeaway – Backed by pro-stablecoin policy and institutional adoption, the stablecoin market’s resurgence reflects its growing role in cross-border payments, market liquidity, and the broader digital dollar narrative.

Pump.fun Launches PumpSwap DEX, Cuts Ties with Raydium

Background – Pump.fun has debuted its own decentralized exchange, PumpSwap, marking a strategic shift away from Raydium as Solana’s memecoin landscape becomes increasingly competitive.

Key Points

• Pump.fun memecoins will now migrate to PumpSwap after bonding, replacing the previous default migration to Raydium.
• PumpSwap mimics Raydium V4 and Uniswap V2, aiming to offer a more seamless trading experience with instant, free migrations.
• The move follows Raydium’s announcement of LaunchLab, a memecoin launchpad that directly competes with Pump.fun.
• PumpSwap will introduce revenue sharing for coin creators, a feature inspired by competitor GoFundMeme, to incentivize higher quality launches.
• Memecoin activity has cooled, with Pump.fun’s daily fees down from $4M in January to $1M in mid-March, and Raydium volumes declining from earlier peaks.

Key Takeaway – As memecoin momentum slows, Pump.fun’s launch of PumpSwap signals a push to control the full lifecycle of its tokens while intensifying competition with Raydium in the Solana DeFi space.

Walrus Foundation Raises $140M to Expand Sui-Based Decentralized Storage

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Background – The Walrus Foundation has secured $140 million in a private token sale to advance development of Walrus, its decentralized data storage protocol built on the Sui blockchain.

Key Points

• Standard Crypto led the round, joined by a16z crypto, Electric Capital, Franklin Templeton, and others including Protagonist and Creditcoin.
• Walrus enables decentralized storage of images, videos, and documents using a delegated proof-of-stake model powered by the WAL token.
• Mainnet launch is scheduled for March 27, and the WAL token will have 5B total supply, with 1.25B in circulation and 60% allocated to the community.
• The protocol leverages Sui’s architecture to offer programmable, interactive, and secure data storage, according to Managing Executive Rebecca Simmonds.
• Mysten Labs, creators of Sui, initially developed Walrus, reinforcing deep technical ties between the two platforms.

Key Takeaway – With major backing and a mainnet launch imminent, Walrus is positioning itself as a key player in decentralized storage, aiming to deliver scalable and secure Web3 infrastructure on the Sui blockchain.

Bybit Hackers Use Mixers After $1.4B Heist, 7.6% of Funds Now Untraceable

Background – Following the record $1.4 billion hack of crypto exchange Bybit, North Korea’s Lazarus Group is using multiple crypto mixers to obscure their laundering trails, posing serious challenges to recovery efforts.

Key Points

• Hackers are using Wasabi, CryptoMixer, Railgun, and Tornado Cash to launder portions of the 500,000 ETH stolen in February.
• 7.59% of stolen funds have “gone dark”, while 88.87% remain traceable and 3.54% frozen, according to CEO Ben Zhou.
• Most ETH has been converted to BTC, now spread across 9,117 wallets, with average holdings of 1.41 BTC each.
• Elliptic and Chainalysis confirm funds are being layered through mixers and anonymous exchanges to avoid detection.
• Bybit’s bounty program has received over 5,000 reports, and the exchange is calling for help from experts to decode complex mixer trails.

Key Takeaway – The Bybit breach underscores the growing sophistication of crypto laundering via mixers, while also highlighting the enduring traceability advantage of blockchain—at least until funds are off-ramped into fiat.

UNI Holders Approve $165.5M Funding, Set Stage for Long-Awaited Fee Switch

Background – Uniswap token holders have voted in favor of two major governance proposals, unlocking $165.5 million in funding for the Uniswap Foundation and laying the groundwork for activating the long-discussed “fee switch.”

Key Points

• $165.5M in new funding was approved, including $95.4M for grants, $25.1M for operations, and $45M for liquidity incentives.
• The proposals aim to expand Uniswap v4 and Unichain, which went live earlier this year, under the “Uniswap Unleashed” initiative.
• 7.5M UNI tokens (~$52M) have been deposited into an Aera vault managed by Gauntlet, seeding the incentive program.
• The fee switch, if fully enacted, would redirect a portion of protocol revenue to UNI holders, marking a shift from liquidity provider-only rewards.
• Uniswap v4 introduces “hooks”, enabling developers to customize pool interactions, while Unichain runs on Optimism’s tech stack.

Key Takeaway – The community-backed funding and renewed push for the fee switch mark a pivotal moment for Uniswap governance, potentially reshaping how value is shared across its growing ecosystem.

First Solana Futures ETFs Set to Launch in the U.S. on Nasdaq

Background – Volatility Shares will debut two exchange-traded funds tracking Solana futures on the Nasdaq, marking the first Solana-based ETFs in the U.S. and signaling growing institutional interest in the altcoin.

Key Points

• SOLZ and SOLT ETFs will begin trading Thursday, tracking Solana futures and offering standard and 2x leveraged exposure, respectively.
• The ETFs are based on futures recently launched by Coinbase’s derivatives arm, and are regulated under the CFTC, not the SEC.
• The debut is seen as a tacit recognition of Solana as a commodity, amid ongoing SEC review of spot Solana ETF applications.
• SOL futures on CME launched earlier this week with $12.3M in daily volume, a modest start compared to BTC/ETH, but in line relative to market cap.
• Solana’s price rose 5% to $130, rebounding slightly after recent 27% losses driven by macro volatility and policy concerns.

Key Takeaway – The launch of Solana futures ETFs in the U.S. marks a significant milestone in the asset’s mainstream adoption, with potential implications for future spot ETF approvals and broader institutional participation.

Hyperliquid’s HLP Vaults Lose 38% TVL After $4M Exploit Despite $1T Milestone

Background – Hyperliquid, a Layer 1 perpetual DEX, is seeing a continued outflow of TVL from its HLP vaults following a $4 million exploit, even as it celebrates surpassing $1 trillion in all-time trading volume.

Key Points

• TVL in HLP vaults dropped from $500M to $312M, a 38% decline since March 11, driven by an exploit and user distrust.
• The exploit occurred after a whale opened a $250M short position, then withdrew margin to trigger forced liquidations covered by the vault.
• Protocol changes were made, successfully tested on March 18, when a $500M short position was closed without triggering losses.
• Despite the incident, Hyperliquid hit $1T in cumulative perps volume and now holds nearly two-thirds of market share, according to Dune Analytics.

Key Takeaway – While Hyperliquid continues to lead the perps DEX space in volume, the exploit and ongoing TVL bleed highlight persistent trust challenges that even strong metrics can't immediately overcome.

Four.Meme Resumes Operations After $120K Sandwich Attack Exploit

Background – BNB Chain-based launchpad Four.Meme has restarted its services after suffering a $120,000 sandwich attack that exploited a vulnerability in its token launch process, marking its second attack in two months.

Key Points

• The attacker exploited a pre-launch vulnerability, bypassing token transfer restrictions and manipulating liquidity pool creation for profit.
• 192 BNB (~$120K) was siphoned off using a sandwich attack, where the attacker pre-seeded liquidity pool addresses and manipulated prices at launch.
• Security firms ExVul and CertiK confirmed the tactic involved pre-calculated pair addresses and timed liquidity additions to drain funds.
• Four.Meme has resumed operations after a full security audit and has initiated compensation for impacted users.
• This is the second exploit in two months, following a $183K attack in February, raising concerns over platform security.

Key Takeaway – As memecoin platforms continue to draw attention, repeated exploits on Four.Meme highlight the urgent need for hardened pre-launch mechanisms and more robust defenses against sophisticated manipulation tactics.

AI Crypto Bot AIXBT Exploited for $100K in ETH via Dashboard Access Hack

Background – AIXBT, an AI-powered crypto market bot built on the Virtuals Protocol, suffered a $100,000 ETH loss after a hacker exploited its dashboard interface through malicious prompting.

Key Points

• 55 ETH (~$100K) was drained from AIXBT’s simulation wallet after the bot responded to two malicious prompts on social media.
• Core systems were not compromised, according to AIXBT maintainer 0rxbt, who emphasized that token fundamentals remain unchanged.
• The exploit appears to be a form of command injection, where the attacker inserted unauthorized instructions via faulty replies.
• In response, the team paused the dashboard, migrated servers, and rotated keys to reinforce system security.
• AIXBT token dropped over 21% following the incident, trading at $0.094, while broader concerns grow around AI-agent security in crypto.

Key Takeaway – The AIXBT exploit underscores the emerging security challenges of AI-driven crypto tools, where novel interfaces and autonomy increase the attack surface for social engineering and command-level vulnerabilities.

Solana Deletes Ad After Backlash Over Gender-Related Messaging

Background – Solana has removed a promotional ad for its Accelerate conference following strong backlash for perceived insensitivity toward gender identity issues and political overtones.

Key Points

• The ad featured a parody therapy session where a man representing “America” mocked progressive themes like pronouns and gender identity, sparking accusations of being “tone deaf.”
• Before deletion, the ad gained 1.2M+ views and over 1,300 comments, many criticizing Solana for engaging in divisive cultural messaging.
• Critics included industry figures like Adam Cochran (Cinneamhain Ventures) and Sean O’Connor (Blocknative), who called the ad “tone deaf” and “horrendous.”
• Solana has not issued a formal explanation, and backlash followed broader political tensions, including Trump’s rollback of gender protections.
• Even early supporters, like Tushar Jain (Multicoin Capital), later retracted praise, calling the ad’s focus on pronouns a misstep.

Key Takeaway – The controversy highlights the risks of politicized messaging in crypto marketing, as community and investor backlash can quickly escalate into reputational damage.

Nym Launches Fully Decentralized VPN Amid Global Privacy Crackdown

Background – Privacy protocol Nym has launched NymVPN, a fully decentralized and anonymous virtual private network designed to protect users from surveillance by governments, corporations, and AI systems, at a time of increasing pressure on privacy technologies.

Key Points

• NymVPN uses a “mixnet” system to route encrypted data through multiple servers while adding fake traffic to obscure metadata, unlike centralized VPNs that track user data.
• The product aims to shield journalists, activists, and citizens in high-risk regions, with no central authority or user tracking possible.
• Nym co-founders Harry Halpin and Chelsea Manning emphasized that the VPN is resilient to takedowns, as its decentralized structure allows the network to function even if its developers are targeted.
• The launch follows recent privacy crackdowns, including Apple’s withdrawal of encrypted iCloud in the UK and developer arrests linked to Tornado Cash.
• NymVPN was demoed in Ukraine and is being promoted among humanitarian organizations and in regions facing censorship or surveillance threats.

Key Takeaway – NymVPN represents a bold step toward censorship-resistant privacy infrastructure, offering a decentralized alternative to traditional VPNs at a time when governments are increasingly demanding surveillance access.