June highlighted pivotal shifts in the blockchain sector, marked by regulatory actions against firms like Consensys, strategic advancements with Ethereum and Solana ETF filings, and technical innovations such as StarkWare’s Bitcoin Layer 2 scaling solution. These developments underscore the ongoing evolution of the cryptocurrency landscape, encompassing regulatory challenges, market growth, and technological enhancements.
In June, several key steps for the spot Ethereum ETF approval have been completed, negotiations between asset management companies and regulators have entered the final stage, and only the final minor revisions are left, indicating a likelihood of the ETF being ready to launch sometime in mid to late July. At the same time, asset manager VanEck also filed for a Solana ETF, although given that there are no live futures markets for Solana yet, it is unlikely that it will be approved any time soon.
The SEC has sued Consensys, the parent company of MetaMask. It is alleging that Consensys has failed to register as a broker through its MetaMask swaps service, and failing to register the offer and sale of securities via its staking programs. Consensys made a public statement later on saying they will fight the SEC in court. In the same lawsuit, the SEC has also classified liquid staking protocols Rocket Pool and Lido as securities due to their staking services.
June was also marked by a series of high-profile token launches such as Blast, zkSync, and IONet, though most of them failed to reach expectations. Sentiment around the zkSync airdrop was relatively soured, with a vocal portion of the community upset about the fact that a significant part of the airdrop, which constituted 17.5% of the total supply, seemed to be attributed to Sybil users. Similarly, Blast’s airdrop was also a relative disappointment, with their launching valuation lower than many expected and a loss of 50% in the chain’s TVL as the token went live.
Fox Corporation, who has been quietly experimenting with blockchain technology, has also announced TIME as its first external publishing partner on its Verify Protocol, where TIME will be using the blockchain-based media platform for content licensing and verification. Currently, more than 300,000 pieces of content from Fox Corporation's media brands have already been signed to the Verify content graph. Crypto exchanges had a strong month, with the notable acquisition of Bitstamp by Robinhood for around $200 million, marking its official entry into the crypto exchange territory. Bitstamp is one of the oldest crypto exchanges and has numerous licenses across many jurisdictions, something that likely weighed in Robinhood’s decision. Binance announced that it has exceeded 200 million registered users, double the amount it had 2 years ago and Bybit has seen its market share surge from 8% to 16%, surpassing Coinbase and is now the second-largest exchange in terms of volume after Binance. There has also been continuous growth in the market value of on-chain tokenized treasury bonds, which has now effectively more than doubled to $1.78 billion since the beginning of the year. Asset managers BlackRock’s and Franklin Templeton’s tokenized treasury products represent the largest portion of this growth, but others like crypto-native protocols Ondo and Hashnote have also been growing fast and are capturing a decent market share.
StarkWare announced a plan to build a Bitcoin L2 scaling solution using its ZK scaling technology, the L2 will be able to process thousands of transactions per second and will be settled simultaneously on Bitcoin and Ethereum. StarkWare will use the same StarkNet network and governance, supporting Bitcoin scaling without requiring a fork. The Ethereum L2 Optimism has begun its decentralization process by implementing fault proofs. Fault proofs allow for the withdrawal of ETH and ERC-20 tokens without relying on trusted third parties and enable users to challenge and remove invalid withdrawals. The implementation of fault proofs was supported by multiple core development teams in the Optimism ecosystem, indicating a collaborative effort. Other OP Stack chains, including Base, Metal, Mode, and Zora, will also upgrade to include fault proofs. The implementation of these fault proofs is an important step in the path of L2’s towards true trustlessness and decentralization.
We saw the Solana Foundation get involved when it removed a group of validator operators from its delegation program due to their involvement in sandwich attacks on Solana users. Sandwich attacks involve placing two transactions around a victim's transaction to manipulate the price and profit from the difference. This removal is procedural, the rules set by the Solana Foundation prohibit such malicious activities, but it is the first time they have had to do this. The Solana Foundation Delegation Program helps validators operate by delegating SOL tokens to them, but operators involved in malicious activities will no longer be subsidized by the foundation. Solana also saw the introduction of ZK Compression by Light Protocol and Helius Labs. ZK Compression utilizes state compression to store data in Solana's cheaper ledger space instead of the more expensive account space. The technology allows developers to store compressed token accounts at a significantly reduced cost compared to traditional methods. ZK Compression has the potential to scale applications on the Solana network. Some members of the Ethereum community have criticized the approach, while Solana co-founder Anatoly Yakovenko defended it as a Layer 2 solution without certain drawbacks.
The Arbitrum governance DAO has approved a somewhat contentious proposal to allocate 225 million ARB tokens through the Gaming Catalyst Program (GCP), worth around $200 million at the time of writing, to support gaming projects on the network. The GCP is one of the largest DAO-backed funding programs ever and had significant vocal pushback due to fears of the price impact on the ARB token and the perceived lack of traction that gaming has had thus far.
June saw two of our portfolio companies, Astria and Redstone, announce new investment rounds. Astria raised a $12.5 million strategic round which was led by dba and Placeholder VC and should set them up with a strong treasury to hire new talent and get them towards launching their shared sequencer layer next year. Similarly, Redstone completed their $15 million series A round after growing its modular oracle service to over 100 clients, securing over $4 billion in value across them all. Some portfolio companies also achieved significant milestones with RiscZero launching their highly performant, production-ready zkVM 1.0 that makes zero-knowledge proofs scalable, accessible, and cost-effective for any chain and Celestia launching Blobstream on Ethereum mainnet. Blobstream streams commitments of Celestia’s data roots to an on-chain Ethereum light client. This provides permissionless, high-throughput DA to Ethereum L2s, secured by crypto-economic guarantees rather than reputation or hidden trust assumptions. Closer to the end of the month, we saw Plural, which is facilitating renewables investing and financing via blockchain rails, host their launch party that officially opened their initial electricity generating solar projects portfolio to investors. Similarly, Sophon, which is building an entertainment and gaming layer, also opened up its first farming pool, allowing users to stake BEAM or staked ETH tokens to get Sophon points.
