Welcome to The Protocol, CoinDesk’s weekly wrap-up of the most important stories in cryptocurrency tech development. I’m Margaux Nijkerk, the Ethereum protocol reporter on CoinDesk’s Tech team.

In this issue:

• Vitalik Buterin Proposes Replacing Ethereum’s EVM With RISC-V
• Matter Labs, ZKsync Developer, Sued for Alleged Intellectual Property Theft
• Scroll’s Euclid Upgrade Pushes It Into ‘Stage 1’ Decentralization Era
• EigenLayer Adds Key ‘Slashing’ Feature, Completing Original Vision

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Network News

SWAPPING THE EVM FOR RISC-V?: Ethereum co-founder Vitalik Buterin shared a new proposal that would radically overhaul the system that powers its smart contracts. ​​Buterin’s suggestion, which he posted on Ethereum’s primary developer forum, involves replacing the Ethereum Virtual Machine, the software engine that powers programs on the network, with RISC-V, a popular open-source framework that offers built-in encryption and other benefits. The EVM has long played an essential role in Ethereum’s development. Other chains that use it can seamlessly connect with apps on Ethereum, and developers on EVM-based networks can transition more smoothly to building applications directly within the Ethereum ecosystem. Buterin argued that transitioning Ethereum to a RISC-V architecture will “greatly improve the efficiency of the Ethereum execution layer, resolving one of the primary scaling bottlenecks, and can also greatly improve the execution layer’s simplicity.” — Margaux Nijkerk Read more.

MATTER LABS SUED FOR ALLEGED INTELLECTUAL PROPERTY THEFT: Matter Labs, the company behind layer-2 blockchain ZKSync, has been sued by BANKEX, a defunct digital asset banking platform, for intellectual property theft. According to a complaint filed Mar. 19 with the New York State Supreme Court, former BANKEX employees Alexandr Vlasov and Petr Korolev allegedly stole the company’s technology to start Matter Labs, which received over $450 million in venture capital funding and has become a major player in the blockchain industry. The complaint, which names BANKEX CEO Igor Khmel and the BANKEX Foundation as plaintiffs, alleged BANKEX was approached by Ethereum co-founder Vitalik Buterin in 2017 to build operational software for «Plasma,» a technology that was seen at the time as a way to make Ethereum cheaper to use. — Margaux Nijkerk Read more.

SCROLL EUCLID UPGRADE BRINGS IN STAGE-1 DECENTRALIZATION ERA : Scroll, the Ethereum layer-2 network, shared that it has launched its Euclid upgrade, which the team called its most significant protocol transformation to date.According to Scroll Labs, a key consequence of the upgrade is that it transitions Scroll from a «stage 0» to a “stage 1” rollup, meaning the network will retire some centrally-controlled safety features in an effort to become more decentralized. “Euclid represents the biggest leap forward for Scroll since its inception,” the team wrote in a blog post shared with CoinDesk. “It’s a statement about Scroll’s future and its commitment to pushing the boundaries of what’s possible in the ZK Rollup arena.” — Margaux Nijkerk Read more.

EIGENLAYER ‘SLASHING’ FEATURE FINALLY GOES LIVE: Almost one year to the day after Ethereum protocol EigenLayer launched its “restaking” network to unprecedented industry fanfare, the network is finally adding a core feature that was, until now, glaringly absent: “slashing.”Eigen Labs hopes slashing — EigenLayer’s system for keeping “restakers” honest by revoking collateral if they act maliciously — will finally realize the year-old protocol’s original pitch. “We are happy to say now that the whole promise has been delivered,” said EigenLayer founder Sreeram Kannan. — Sam Kessler Read more.

In Other News

• Traders shorting Strategy (MSTR), the bitcoin buyer whose share price gained 13% in March, may be struggling to find enough stock to repay the lenders who underpinned their bets the company’s value would fall. More than $180 million worth of trades in MSTR stock failed to settle last month, data from the SEC and Fintel show. These events, known as Failures to Deliver (FTDs), happen when a seller doesn’t deliver shares to the buyer by the settlement deadline, now just one business day after the trade (T+1). — James Van Straten and AI Boost Read more.
• Bitcoin (BTC) has become the fifth-largest asset by market capitalization, reaching $1.86 trillion and surpassing Google (GOOG) as it breaks through $94,000. This marks the highest position bitcoin has ever attained in the rankings, even though its market cap previously exceeded $2 trillion when its price was over $109,000. At that time, however, tech stocks were significantly more elevated than they are at the moment. — James Van Straten Read more.

Regulatory and Policy

• Paul Atkins has taken the oath to formally become chairman of the U.S. Securities and Exchange Commission, which returns Mark Uyeda to his previous role as a Republican Commissioner after three busy months of service as the agency’s stand-in chief. Atkins permanently replaces the former chair, Gary Gensler, who the crypto industry had widely seen as its chief antagonist in the U.S. government. — Jesse Hamilton Read more.
• Fundraising for sophisticated crypto investment vehicles has yet to fully experience the anticipated positive headwind of the Donald Trump presidency, according to a new report by the Crypto Insight Group. Momentum «remains positive but slower than [fund] managers anticipated under the new Trump administration,» the Hedge Fund Outlook 2Q25 report said. — Jamie Crawley Read more.

Calendar

• April 30-May 1: Token 2049, Dubai
• May 14-16: Consensus, Toronto
• May 19-23: Solana Accelerate, New York City
• May 20-22: Avalanche Summit, London
• May 27-29: Bitcoin 2025, Las Vegas
• June 30-July 3: EthCC, Cannes
• Oct. 1-2: Token2049, Singapore

Canada will host an election next week, where voters will consider a range of issues — the economy, housing, trade relations with the U.S. — as they choose their elected officials, who in turn will choose the next Prime Minister of the country.

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Canada’s top choices

The narrative

Crypto is not a major electoral issue during this year’s Canadian election. Neither leading Prime Minister candidate has campaigned on digital assets, but here’s how they’ve discussed the issue in the past.

Why it matters

Canada infamously had massive crypto exchange collapses over the past few years, leading to concerted efforts from its provincial regulators to enact guardrails on the digital asset industry. While exchanges like Coinbase are calling for policies like a Canadian government task force or a bitcoin reserve, so far the leading candidates for Prime Minister seem to have other issues on their minds (namely: U.S. relations and trade, housing and the economy).

Breaking it down

When Canadians go to the polls next Monday, they’ll be choosing their Member of Parliament. The party with a majority of seats will form the country’s new government, and the leader of that party will become the new Prime Minister.

While the Conservative Party and its leader Pierre Poilievre held comfortable leads in polling averages through late-January 2025, the Liberal Party saw a massive surge in popularity after U.S. President Donald Trump announced tariffs with Canada (and most other countries). The Liberal Party, now with leader Mark Carney, has held a significant edge ever since, according to both polling data and Polymarket. Carney took over from former Prime Minister Justin Trudeau as leader of the Liberal Party last month.

Pierre Poilievre

Poilievre is a longtime Bitcoin and blockchain advocate who has led the Conservative Party since September 2022. He owns shares in a Bitcoin exchange-traded fund (ETF). In 2022, he promised to turn Canada into the «blockchain and crypto capital of the world» during a campaign speech (a phrase Trump later used on the 2024 campaign trail).

«I want to take control of money away from politicians and bankers, and give it back to the people,» he said. «We need to give people the freedom to choose other money. If the government is going to abuse our cash, we should have the right to opt to use other, higher-quality cash.»

He even bought shawarma using bitcoin during his campaign for Conservative Party leader, discussing digital assets in a 30-minute interview with the owner of the restaurant.

He supported Canada’s trucker protest, which dubbed itself the «Freedom Convoy» in early 2022 to object to a vaccine mandate for any truckers crossing the U.S.-Canadian border. At the time, the Canadian government sought to freeze financial support for the protestors, including by sanctioning crypto wallets tied to the truckers.

While Poilievre does not appear to have specifically linked Bitcoin or other cryptocurrencies to the truckers who may have lost banking access, he did call bitcoin «the single most important asset you could own.»

Poilievre has also opposed the Bank of Canada’s research into a central bank digital currency, arguing that it could infringe on privacy rights or let lawmakers target benefits to supporters. Last year he supported a bill which would have banned a Canadian CBDC outright (echoing U.S. Republicans who have done the same here).

Canadian magazine Maclean’s reported that while Poilievre has said less about crypto in recent days, the Conservative Party as a whole still tends to support the industry, citing various Members of Parliament who have introduced bills or otherwise discussed crypto.

Poilievre did seem to discuss crypto publicly less after FTX’s dramatic collapse in 2022, which his political opponents used to issue warnings about his prior advocacy for digital assets. Poilievre may also be reckoning with Trump’s unpopularity in Canada, and seeking to distance himself from policies that may imitate the U.S. President’s.

Mark Carney

Carney was the head of both the Bank of Canada and later the Bank of England. While he hasn’t said a lot about Bitcoin, he did give a speech on the «future of money» in London in March 2018, where he criticized digital assets’ use, citing speculative mania and a lack of vendors willing to accept it as a payment tool.

«The long, charitable answer is that cryptocurrencies act as money, at best, only for some people and to a limited extent, and even then only in parallel with the traditional currencies of the users,» he said. «The short answer is they are failing.»

Carney pointed to transaction throughput, ease of access and other issues as barriers to digital asset adoption, but said his concerns with digital assets at the time were «not meant to dismiss them.»

«Their core technology is already having an impact. Bringing cryptoassets into the regulatory tent could potentially catalyse innovations to serve the public better,» he said. «Crypto-assets are an attempt to create the financial architecture for peer-to-peer transactions. Even if the current generation is not the answer, it is throwing down the gauntlet to the existing payment systems. These must now evolve to meet the demands of fully reliable, real-time, distributed transactions.»

Carney praised distributed ledgers in particular, and suggested that existing digital asset infrastructure could eventually lead to the creation of a central bank digital currency, though he said «there are also broader societal questions» around issues like privacy should a central bank pursue a CBDC.

Just over a year later at the Economic Policy Symposium in Jackson Hole, Wyoming, Carney suggested that a global hegemonic digital currency backed by central bank digital currencies could bolster the world economy against the role of the dollar.

«The dollar’s influence on global financial conditions could similarly decline if a financial architecture developed around the new [Synthetic Hegemonic Currency] and it displaced the dollar’s dominance in credit markets,» he said in August 2019. «By reducing the influence of the US on the global financial cycle, this would help reduce the volatility of capital flows to EMEs.»

Stories you may have missed

• How Some Bitcoin Mining Firms Try to Game U.S. Customs Controls: Crypto mining firms may undervalue the cost of their equipment when importing their chips to the U.S. to evade customs dues, intermediaries in the industry tell CoinDesk’s Tom Carreras.
• Crypto Ally Paul Atkins Sworn In to Replace Gary Gensler Atop U.S. SEC: Paul Atkins, after his Senate confirmation earlier this month, is now the chair of the U.S. Securities and Exchange Commission.
• U.S. Derivatives Watchdog Weighs 24/7 Action With Crypto Oversight on Horizon: The U.S. Commodity Futures Trading Commission published a request for comment on what 24/7 derivatives trading might look like.
• Trump’s Official Memecoin Surges Despite Massive $320 Million Unlock in Thin Holiday Trading: The TRUMP memecoin shot up over 9% last weekend after $320 million in tokens unlocked, though it’s still down more than 88% in the past few weeks.

This week

Friday

• 17:00 UTC (1:00 p.m. ET) The U.S. Securities and Exchange Commission will hold the latest of its crypto roundtables, this time focusing on custody issues.

Elsewhere:

• (The New York Times) Defense Secretary Pete Hegseth had another group chat where he shared details about an impending military strike in Yemen. Unlike the Signal chat which included The Atlantic’s editor-in-chief, Hegseth himself set this group up, and included his wife, brother and personal lawyer, the Times reported. NBC later reported that the information about the strike came from a message sent by an Army general through «a secure U.S. government system.»
• (Reuters) The Federal Deposit Insurance Corporation plans to lay off a fifth of its employees, or 1,250 people, it told its staff according to Reuters.
• (AP News) The Consumer Financial Protection Bureau announced it would lay off 1,500 employees, but this move has been paused by U.S. District Judge Amy Berman Jackson.
• (The New York Times) Sen. Chris Van Hollen, a Democrat representing Maryland, met with Kilmar Abrego Garcia in El Salvador. Abrego Garcia was wrongfully sent to El Salvador to be imprisoned without a trial or hearing, and El Salvador President Nayib Bukele’s administration tried to stage the photos of his meeting with Van Hollen by placing glasses «with cherries and salted rims» for photos, the Times reported.

If you’ve got thoughts or questions on what I should discuss next week or any other feedback you’d like to share, feel free to email me at nik@coindesk.com or find me on Bluesky @nikhileshde.bsky.social.

You can also join the group conversation on Telegram.

See ya’ll next week!

The crypto market’s rally stalled on Wednesday after U.S. Secretary of Treasury Scott Bessent reiterated that a proper trade deal between Washington and Beijing would take years to ink out.

Bitcoin (BTC) is up 2.6% in the last 24 hours and 12.2% in the last seven days, trading at $93,600 for the first time since the beginning of March. The largest cryptocurrency was outperformed by large swaths of the market, with the CoinDesk 20 — an index of the top 20 coins, excluding stablecoins, memecoins and exchange tokens — rose 4.2% in the last 24 hours. Sui (SUI) jumped 24% in that period of time, while Cardano’s ADA and Chainlink’s LINK both saw 7% gains.

Crypto stocks, which opened strong, saw their performance dampen as the day unfolded. Miners such as Bitdeer (BTDR) and Core Scientific (CORZ) fell back from double-digit gains, closing the day up roughly 4%. Coinbase (COIN) and Strategy (MSTR) are up 2.1% and 1.4%, respectively.

U.S. President Donald Trump seemed to be dialing down the pressure on China in the last few days, saying that tariffs on the Middle Kingdom would “come down substantially” on Tuesday. Bessent, however, said on Wednesday that the White House had not made a unilateral offer to cut tariffs on China, and that a deal between the two nations would take two to three years to achieve.

«A meaningful thaw in relations may not materialize until substantive news emerges from the upcoming Xi-Trump meeting,» said Paul Howard, director at crypto trading firm Wincent. Markets priced in the initial tough stances and tariff threats, which kept a lid on risk appetite over the past two months, he said.

«History suggests that once the opening volleys pass, more constructive developments and easing volatility typically follow,» Howard said, which could support risk assets such as crypto.

BTC ETF flows return

In a sign of renewed investor demand, U.S.-listed spot BTC exchange-traded funds (ETFs) have recorded nearly $1.3 billion in net inflows this week so far, according to SoSoValue data. The funds booked their strongest day on Tuesday since mid-January.

«This [crypto] rally isn’t retail-driven hype—it’s institutional capital positioning ahead of what many see as a new monetary and political regime,» said Matt Mena, crypto research strategist at digital asset manager 21Shares. «More investors are turning to it not just as a speculative asset, but as a flight to safety amid rising uncertainty across traditional markets.»

Despite the strong price action, Mena added that BTC is facing resistance at around the $95,000 level in the short term and could pull back.

Bitcoin to catch up to gold

Gold, meanwhile, is down 2.5% today, trading at $3,290 per ounce after a run that saw the precious metal rise 35% to $3,500 in the span of four months, possibly hinting that the market could be moving past peak uncertainty.

Gold stalling after a massive rally could bode well for bitcoin, said Charles Edwards, founder of bitcoin-focused hedge fund Capriole Investments. Posting a chart on X on Wednesday, he noted that BTC historically followed gold’s gains with a few-month lag.

«Bitcoin is showing significant strength,» Edwards said in an X post. «We have decoupled from risk assets and the market is now starting to front-run the fact that bitcoin is digital gold. If risk assets were to decay further from here, BTC is the ultimate QE [quantitative easing] hedge.»

Read more: Bitcoin Breaches ‘Ichimoku Cloud’ to Flash Bullish Signal While Altcoins Lag: Technical Analysis