Welcome to the protocolCoinDesk’s weekly roundup of the top stories in cryptocurrency technology development. I’m Ben Schiller, CoinDesk’s features and opinion editor.
In this issue:
- HyperLiquid responds to criticism over decentralization
- StarkWare launches appchains on Starknet
- Arbitrum deepens ties with South Korea’s Lotte Group
- Do Kwon’s criminal trial is set for 2026
- Pyth Network partners with Revolut in the DeFi data agreement
- Ripple aims to increase the utility of stablecoins in the Chainlink agreement
- AI coins fail to match 2024 performance despite bullish outlook
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Network news
HYPERFLUID REVIEW: HyperLiquid, a major advance in the world of decentralized finance, came under fire this week due to claims that the network is overly centralized and difficult to work with. HyperLiquid is best known for its flagship decentralized exchange, and it recently launched a layer-1 blockchain — all bids from the startup to, according to its flashy web copy, eventually “house all finance.” Despite praise for its fast and user-friendly exchange interface, HyperLiquid has been criticized for, among other things, operating a closed source code base. According to a widely shared X-thread by Kam Benbrik, an employee of validation company Chorus One, the validators running HyperLiquid are mostly blind to how the chain works under the hood, making it difficult for them to operate the hardware that needs to drive. the chain. Benbrik also raised concerns that HyperLiquid’s highly concentrated token supply — and its process for admitting validators to its L1 chain — makes the chain centralized and vulnerable to failure. “Hyperliquid needs to improve transparency, decentralize efforts, implement a fair validator selection process, and engage more with external validators,” Benbrik wrote. The complaints come on the heels of a flurry of positive media attention for HyperLiquid following November’s massively successful HYPE airdrop. It hasn’t all been smooth sailing for the startup, however, with the investigation arising in December after reports of potential North Korean activity on the network — interpreted by some as a sign that the regime, known for its crypto-hacking efforts, may have HyperLiquid in the crosshairs. HyperLiquid has brushed off North Korean security concerns, and it recently addressed the centralization and criticism of closed source code in an X thread, stating that the criticism largely stemmed from “misunderstandings” about its technology. Read more. –Sam Kessler
SOLANA’S FIRE DANCERS FORGE AHEAD: Solana is rolling out its next-generation blockchain client “Firedancer,” pushing validators running the chain to adopt a stripped-down version of the upgrade ahead of a wider, yet-to-be-scheduled official launch. “Firedancer’s supporters believe the software — developed by trading giant Jump’s crypto arm — will give Solana an unrivaled advantage in crypto’s race to woo global financial markets to blockchains,” writes CoinDesk’s Danny Nelson. “They point to its theoretical speed: a million transactions per second, orders of magnitude faster than any blockchain-based system today.” –Sam Kessler
STARKWARE APPCHAINS: Starknet, the layer-2 blockchain on Ethereum known for its embrace of zero-knowledge (ZK) cryptography, is adding appchains. StarkWare, the primary developer of Starknet, told CoinDesk that its “SN Stack” will let developers easily build blockchains tailored for specific crypto use cases. Read more
ARBITROOM-a-LOTTE: Arbitrum, the largest layer-2 network on Ethereum, plans to deepen ties with Lotte Group, the multi-billion dollar South Korean conglomerate known for its vast portfolio of shopping malls, media companies and entertainment properties. Offchain Labs, the developer behind Arbitrum, and the Arbitrum Foundation, the non-profit managing the project’s development, said a financial deal is in the works that will cement Arbitrum as the main blockchain infrastructure provider for “Caliverse,” Lotte’s metaverse- gaming platform. Read more
AVALANCHE UPGRADE: Avalanche, now the tenth-largest L1 by total value locked (TVL), activated its long-awaited Avalanche9000 upgrade, marking its biggest technical changes since launching in 2020. The network has been preparing these changes for months with new features that will cut down costs for sending transactions, operating validators and building applications on the network. Executives at Avalanche said the upgrade is intended to attract developers and encourage them to create custom blockchains using its technology, known as subnets or “L1s.” Read more.
DO THE KWON TEST: Terraform Labs co-founder and former CEO Do Kwon’s criminal fraud trial in the United States is tentatively scheduled for January 2026, giving prosecutors and Kwon’s defense attorneys time to review the “massive” six terabytes of data expected to be produced during the discovery process. During a preliminary hearing in Manhattan this week, Chief Prosecutor Jared Lenow told the court the government expected to face further delays because of challenges accessing encrypted information and unlocking four cell phones provided by Montenegrin authorities when they extradited Kwon to the US on December 31. . Lenow added that the government must also translate extracted material from Kwon’s native Korean. Read more.
PYTH PARTNERS: Blockchain oracle firm Pyth Network has partnered with neobank Revolut to transfer digital banking data to decentralized finance. Revolut will provide data for more than 500 markets, including currencies, stocks and commodities. Revolut also runs a crypto exchange, although volume data is not published. Competing with ChainLink, Pyth aims to provide accurate price feeds for DeFi protocols. It dropped its initial token (PYTH) in 2023 and has $7.5 billion in value secured on its oracle, according to DefiLlama. Pyth also receives data from crypto exchanges Bitstamp, Bybit and Binance, as well as several trading firms such as Jane Street and Cumberland DRW. Read more.
AI COINS: AI crypto tokens are failing to meet their lofty 2024 targets despite Nvidia’s ( NVDA ) recent conference sparking bullish sentiment among AI stocks in the traditional markets. Last March, the NEAR token doubled in the run-up to Nvidia’s annual conference, gains that were mirrored across the broader crypto AI market. Fetch.AI (FET), graphen (GRT) and singularityNET (AGIX) all showed significant rallies to the upside in line with the conference. Why are AI tokens losing momentum? One reason: the rise of AI agent tokens. Read more.
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Calendar
- 7.-10. January 2025: CES, Las Vegas
- 20.-24. January: World Economic Forum, Davos, Switzerland
- 21.-25. January: WAGMI Conference, Miami.
- 24.-25. January: Adoption of Bitcoin, Cape Town, South Africa.
- 30-31 January: PLAN B Forum, San Salvador, El Salvador.
- 1.-6. February: Satoshi Roundtable, Dubai
- 19.-20. February 2025: ConsensusHK, Hong Kong.
- 23.-24. February: NFT Paris
- 23 Feb-2 March: ETHDenver
- 18.-19. March: Digital Asset Summit, London
- 14.-16. May: Consensus, Toronto.
- 27.-29. May: Bitcoin 2025, Las Vegas.
