Welcome to the protocol, Coindesk’s weekly wrapping of the most important stories in cryptocurrency tech development. I am Margaux Nijkerk, a reporter in Coindesk.
In this number:
- Bitcoin mining is facing ‘incredibly difficult’ market as power becomes the real currency
- Bitcoin Liquid Staking gets speed as Lombard launches Bard Token and Foundation
- Optimism taps flashbots to supercharge up stack sequencing
- Hemi Labs Travel $ 15M to Expand Bitcoin Programmability
Network news
Bitcoin Mining players are facing challenging market: Bitcoin my workers have long been defined by the boom-and-bust rhythm of the four-year half-life cycle. But the game has now changed, some of the industry’s most prominent leaders said at the Salt Conference in Jackson Hole earlier this week. The increase in exchange -trading funds, the rising demand for power and the prospect of artificial intelligence (AI) Reforming infrastructure needs must average, that miners must find ways to diversify or risk being left behind. “We used to come here and talk about hash frequency,” said Matt Schultz, CEO of Cleanspark. “Now we’re talking about how to make money on megawatts.” For years, mining companies lived – whose revenue mainly came from producing Bitcoin – and died at the half -cycle. Every four years, rewards were cut in half, and miners shrinked to reduce costs or scale up to survive. According to these leaders, this rhythm no longer defines the company. “The four -year cycle is effectively broken with the maturation of Bitcoin as a strategic asset, with ETF and now the strategic treasury and what not,” Schultz said. “Adoption drives demand. If you read something about the latest ETF, they have devoured infinitely more bitcoin than have been generated so far this year.” Cleanspark, which now operates 800 Megawatt Energy Infrastructure and has an additional 1.2 gigawatts in development, has begun to turn its attention beyond Proof-of-Work. “Our speed in the market with electricity has created opportunities so that we can now look at ways to make money on the flow beyond just Bitcoin mining,” he said. “With 33 locations we now have much more flexibility than we have ever done before.” Schultz is not alone in calling the industry’s shift in business model. Patrick Fleury, CFO for Terawulf, repeated the mood and not the sugar coat that the profits pressed, as miners feel. “Bitcoin mining is an incredibly difficult business,” he said. He broke down the economy of Bitcoin mining in straightforward terms: with electricity that costs five cents per day. Kilowattime, it currently costs about $ 60,000 to mine a single bitcoin. At a Bitcoin price of $ 115,000, this means half of the revenue is consumed by power alone. When business expenses and other operating costs are incorporated, the margins are tightened quickly. In his view, the profitability of mining is almost exclusively on ensuring ultra-low cost effect. – Helene Braun Read more.
Bitcoin Liquid Staking rises: In most of its story, Bitcoin has been touted by its followers as digital gold: an asset to hold rather than use. This passivity has left trillion of dollars worth of BTC, (Defi). The increase of floating stake roofs promises to change it, placement of Bitcoin not only as a value of value, but as a productive active integrated in the capital markets on the chain. Liquid Stoting allows users to offer their crypto to help secure a network and, in turn, receive a liquid, marketable token that represents the stacked assets and can be used across defi while the original tokens continues to serve reward. Lombard Finance has emerged as one of the prominent projects in Bitcoin Liquid Stake. Its flagship product, LBTC, is a yield token supported 1: 1 of BTC. When BTC is deposited in the Lombard Protocol, the underlying coins are stacked, primarily via Babylon, a protocol that enables confidence-free, self-defense Bitcoin stacking. Users receive LBTC, in turn, which can be implemented across defi -ecosystems, while the original Bitcoin earns staff. This double functionality is key. Holders can hold the exposure to Bitcoin while using LBTC in lending, borrowing and liquidity run across protocols such as Aave, Morpho, Pendle and Ether.fi. LBTC is designed for interoperability and moves across Ethereum, base, BNB chain and other networks, which prevents liquidity fragmentation and ensures that Bitcoin can participate in a multi-chain defi environment. – Jamie Crawley Read more.
Optimism and Flashbots Collaboration: Optimism collaborates with flashbots to renew how transactions are treated across its up stack ecosystem with the aim of making some of Ethereum’s most popular LAG-2 networks faster and more adaptable. The partnership centers on sequencing, behind the scenes process that determines how quickly a transaction confirms what trades are prioritized and how much users ultimately pay. Optimism says that Flashbots’ infrastructure, which is already responsible for building more than 90% of Ethereum’s blocks, will now bring almost instant confirmations and user -friendly transaction to any chain in the so -called superchain. This matters because the upstroke underestimates more than 60% of all Ethereum-Lay-Lay-2 activities, the Optimism Meteam, including some of the most well-known LAG-2 chains such as base, unichaint, world and zoneium. Until now, advanced sequencing functions such as ultra-fast settlement, front-truck protection and customized compliance rules were only available for the largest chains with resources to build them internally. With flashbots on board, these features will be available through tools for any project building on Optimisms up stack. – Margaux Nijkerk Read more.
Hemi Labs collects 15 million dollars: Hemi Labs, Bitcoin programmability network founded by Jeff Garzik, raised $ 15 million in financing to speed up development and expand its ecosystem. The round included yzi labs (Former Binance Labs)Republic Digital, Hyperchain Capital, Breyer Capital, Big Brain Holdings, Crypto.com and others, according to an E email message. The company said the funds will support applications for borrowing, lending and trading on Bitcoin while developing its HEMI -Virtual Machine (Hvm)A layer that embeds a Bitcoin knot inside an Ethereum World Cup – the expression of a decentralized system that can execute smart contracts and process transactions at Ethereum. – Jamie Crawley Read more.
In other news
- Aave Labs introduced Horizon, a new platform dedicated to institutional borrowers to access stableecoins using tokenized versions of assets in the real world (Rwas) As US Treasury as security. At the launch, institutions will be able to borrow Circle’s USDC, Ripple’s RLUSD and AAVES GHO against a set of tokenized assets, including Superstate’s US Treasury and Crypto Carry Funds, Circle’s Yield Fund and Centrifuge’s Tokenized Janus Henderson Products. The platform aims to offer qualified investors short-term financing on their RWA holdings and allow them to implement yield strategies. – Kristzian Sandor Read more.
- Google Cloud goes ahead with plans to launch its own LAG-1 blockchain and place the network as a neutral infrastructure for global funding at a time when fintech competitors are developing their own distributed headbooks. In a LinkedIn post published on Tuesday, Rich Widmann, Google’s head of web3 strategy, delivered fresh details of the project, known as Google Cloud Universal Ledger (GCUL). He described the platform as a credible neutral, high-performance blockchain designed for institutions that support Python-based smart contracts to make it more accessible to developers and financial engineers. “Any financial institution can build with GCUL,” Widmann said, arguing that although companies like Tether may not be unlikely to adopt Circle’s blockchain and payment companies like Adyen May hesitate to use Stripe’s, Google’s neutral infrastructure removes these barriers. – Siamak Masnavi Read more.
Legislative and politics
- Crypto Industry’s Washington lobbyists are trying to draw a line in the sand over the bill to the market structure that steams through the US Senate and says they cannot support a law that would not fully protect software developers from being held responsible for poor actors who are abusing their technology. The industry made its case to the Senate’s Banking and Agriculture Committee “With a Voice” that sent a letter on Wednesday signed by Coinbase, Kraken, Ripple, A16z, Uniswap Labs and more than a hundred other cryptic businesses and organizations, including almost all major US lobby groups. This overall effort comes the week before the Senate comes back to work, and is likely to revive full negotiations on the language of the legislation representing the industry’s top US goals. – Jesse Hamilton Read more.
- The US Commodity Futures Trading Commission is falling into a single commissioner when Democrat Kristin Johnson leaves the agency next week, and the only other person waiting in the wings to join the regulator, President Donald is President Nominated, Brian Quintenz. From September 3, the five-member commission falls into one because it is when Johnson plans to quit. “By promoting an agenda in the name of growth, it is critical not to settle the basic resilience that supports economic stability and protects the wider economy,” she said in a farewell statement calling on the agency to stick to the basic elements when new technologies come on board. – Jesse Hamilton Read more.
Calendar
- 22-28. September: Korea Blockchain Week, Seoul
- 1-2 October: Token2049, Singapore
- 13-15 October: Digital Asset Summit, London
- 16.-17. October: European Blockchain Convention, Barcelona
- November 17-22: DevConnect, Buenos Aires
- 11-13. December: Solana Breakpoint, Abu Dhabi
- 10-12. February 2026: Consensus, Hong Kong
- 5-7 May 2026: Consensus, Miami
