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Market Rebound: How to Learn from a Pullback and Keep Navigating the Price Action?
Original Article Title: Conviction and Mental Capital in Crypto
Original Author: ElNachoCrypto, Crypto Researcher
Original Translation: ChatGPT
Editor's Note: The article explores the importance of conviction, mental capital, and a simplified strategy in cryptocurrency investment, emphasizing avoiding frequent trading and mistakes through self-reflection and a long-term perspective. The author provides 10 constructive suggestions, reminding readers to deepen their understanding through continuous research while maintaining emotional control and rational thinking to navigate market fluctuations.
The following is the original content (slightly reorganized for readability):
TL;DR
· Keep it simple; less is more. Having countless investments and activities filling your mind will lead to poor decisions.
· Why the rush to get rich? Bear in mind that money made quickly often disappears just as fast.
· Narrow your focus, guided by conviction and inner peace.
The Crypto World is Full of Distractions
Back in 2017, when I entered this space, I bought a batch of BTC at around $3500 cost basis. If I had fallen into a coma right after my last buy and woke up today, my financial situation would be quite nice.
I would have avoided countless round trips of trading, pain, and agony. But where's the fun in that? We must go through these to reach the other side, learning what we need to know to succeed. That's why we must accept and try to "enjoy" the hardship—seeing it as educational. Or as Ray Dalio put it: pain + reflection = progress.
The reflection part is crucial. That's why I write these things. Because I feel I must process the pain and articulate the lessons.
But what am I here to say? From 2017 to 2025, I was involved in nearly every activity offered (except scamming, my conscience wouldn't allow it). Trading, flipping NFTs, airdrop mining, yield farming, early-stage investments, and so on.
Despite all these endless efforts to quickly amass wealth, simply DCA-ing BTC since 2017 would have outperformed everything, and I would have expended less mental energy and time. This simple, boring, slow but consistent behavior would have brought unimaginable gains. The lesson lies therein.
I recently saw someone ask Cobie, given all the "moth-like" downfall around meme coins, what they should do. I think his answer was brilliant:
@cobie: Don't buy into that scammy stuff, save your money. Buy Bitcoin and other extremely scarce valuable things. Set longer-term goals for personal wealth. Ignore everything else as it's irrelevant.
I'm a huge fan of Cobie. I think he's a rational voice among a very noisy bunch of idiots.
It's not just about telling you to dollar-cost average into BTC, but to say:
· I think we're so obsessed with getting rich quick that we end up engaging in activities that repeatedly make us lose money.
· We need a longer, much longer wealth accumulation time frame.
· Learn from experience (mine and others')—money often follows the principle of "easy come, easy go." @Trader_Dante said it best:
@Trader_Dante: One of the reasons I don't suffer from FOMO is that in my 21 years of trading, I have found that almost everyone in this trading arena can't hold onto the money they make. A person's brief success doesn't excite me. I can usually correctly guess they'll end up with nothing.
· The crypto world is indeed an unregulated casino. If people really get what they want from the market (win or lose), they'll find their poison here.
· Many of us are indeed chasing 10 rabbits, so much so that we never learn what we're good at, cultivate consistency, ending up worse off than when we started.
Narrow Your Focus With Conviction
Believe in something, but be extremely cautious about what you choose to believe in. There are more scammers here than in the Wild West. Maintain a high level of suspicion towards everyone and everything, after all, this is the crypto world.
That's why I think some of Murad's tweets have caused people to lose a lot of money. He's promoting his point but borrowing someone else's conviction is almost worthless because when your resolve is inevitably tested, you won't have the fortitude to see it through.
On one hand, I admire Murad's conviction (I believe his argument is flawed, but that's another topic), but I also believe this will bring many painful lessons to those who choose to follow him. Perhaps this will ultimately lead to a lot of learning.
You must form your own arguments and beliefs through months or years of research. There is no other way. Doing so will give you peace of mind, knowing that you have done your homework, and the market will take care of the rest.
I have developed very few long-term high-conviction investments. I don't need to share them here, but what's important is that when the market gives me a gift (like a random airdrop), the funds flow back into my conviction.
I don't want to hold more than 10 different tokens or invest in over 10 projects. It is very draining mentally. Each project requires a certain level of attention, and combining them significantly increases the likelihood of neglect and mistakes. Research shows that we all have limited cognitive resources, and each new task requires its own cognitive processing, whether conscious or unconscious.
I'm not providing any financial advice here, just some things to think about:
1. Declutter your mind and portfolio. Sell low-conviction assets and buy high-conviction assets.
2. Deepen your conviction in these assets through ongoing research.
3. Nevertheless, the crypto world is an extremely fluid place, and you must be too. Be ready to abandon anything at any time. I'm not saying sell something impulsively at the first sign of bad news, just be prepared to objectively review your arguments at any time.
4. Pay attention to people who hold the opposite view of your arguments; they may show you things you haven't considered. I always pay attention to those who are skeptical of Hyperliquid. I really want to know what they have to say and what I can learn from it.
5. Objectively monitor your (and others') emotions/reactions to challenges to firm beliefs. Ask yourself, "Why am I/they so excited about this? What does this reveal about them/me?" If needed, imagine yourself standing behind yourself as a passive observer—how does your behavior look?
6. Always question your own ability to remain objective. We are not always rational or logical beings.
7. Always keep some spare funds for those once-a-year/cycle enticing opportunities. I dare say, once you have a fairly substantial amount of funds ready to deploy, you can do almost nothing for most of the year; just wait for those opportunities. Also, consider that some people here only use USDC for yield/airdrop farming and have a relatively small exposure to spot crypto assets. If you're going all in, you better have a very good reason.
8. Inner peace comes from knowing that if the casino bankrupts you today, you'll be okay tomorrow. If you are overexposed, you will make bad decisions. Do not invest more in your portfolio than you can truly afford to lose—revisit this number frequently.
9. Do nothing and govern. It is a beautiful thing when you can truly sit back and relax your position. Most money is made by doing nothing, whether it's holding cash for high-value opportunities or actively positioning due to a significant, high-timeframe mean-reversion event.
10. Part of the reason you are satisfied with your argument is profit-taking. When you know you have made a huge profit, several times your initial capital, holding longer becomes much easier. People really overlook this. It's not easy, it takes practice, but force yourself to adopt this habit. I pasted these two screenshots from @Tradermayne and @Pentosh1 into my investment portfolio sheet:
@Tradermayne: I agree, but you don't have to wait until the end of the bull market to take profits. You should gradually cash out during this process.
The likelihood of accurately judging when the bull market will end is very low. Lock in profits as your portfolio reaches a milestone; it feels much better than hoping to cash out all at once near the market top.
It is almost impossible to sell all assets at the "top," especially since some assets peak at different times. Besides, your portfolio's historical all-time high value may not perfectly align with the actual market top and there will be some volatility.
Moreover, if the market persists longer than expected, taking profits along the way allows you to have funds on hand to reinvest when necessary.
Of course, if you don't change your lifestyle, this money won't fundamentally change your life.
Relax, don't rush. The opportunity will come again.
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Never Underestimate the Significance of the US Stablecoin 'Infrastructure Bill'
If the US stablecoin bill, the "GENIUS Act," passes smoothly this time, its significance will be tremendous. I even think it's significant enough to enter the top five in Crypto history.
Although abbreviated as the GENIUS Act, which translates directly to the Genius Act, it is actually the Guiding and Establishing National Innovation for U.S. Stablecoins, which translates to "Guiding and Establishing National Innovation for US Dollar Stablecoins."
The proposal is lengthy, with several key points summarized for everyone:
· Mandatory 1:1 Full Asset Backing: Assets include cash, demand deposits, and short-term US Treasuries. At the same time, misappropriation and rehypothecation are strictly prohibited.
· High-Frequency Disclosure: Reserve reports must be published at least monthly, introducing external audits.
· Licensing Requirement: Once the circulating market cap of the issuer's stablecoin exceeds $100 billion, it must transition into the federal regulatory system within a specified timeframe, adopting banking-grade regulation.
· Introduction of Custody: The custodian of the stablecoin and its reserve assets must be a regulated qualified financial institution.
· Clear Definition as a Payment Medium: The bill explicitly defines stablecoin as a new type of payment medium, primarily regulated by the banking regulatory system, rather than restricted by the securities or commodities regulatory system.
· Embracing Existing Stablecoins: A maximum 18-month grace period after the bill's enactment, aimed at encouraging existing stablecoin issuers (such as USDT, USDC, etc.) to promptly obtain licenses or become compliant.
After finishing the main content, let's talk about the significance of this matter with an excited heart.
Over the years, when others asked, "After working in the Crypto industry for 16 years, what application have you created?"
In the future, you can confidently tell others—Stablecoins.
Some people have held opposing views. In the past, people's impression of stablecoins was that they were an opaque black box. Every few months, there would be FUD — whether Tether's assets were frozen or Circle had a significant black hole deficit.
In fact, if you think about it, Tether easily rakes in billions of dollars a year just from the interest on those underlying government bonds. Circle, slightly less, also made a $1.7 billion profit last year.
They basically made money while standing there. From a motivational standpoint, they have no malicious intentions. In fact, they are the most eager for compliance.
Now, this opaque black box will become a transparent white box.
In the past, the only complaint was that Tether's funds might have been frozen by the United States. Now, they will be directly placed into U.S. compliant custodial institutions, with high-frequency disclosures, so you can rest assured.
【No need to worry about a rug pull】 is such a huge advantage—I think especially all Crypto people understand this.
Stablecoins were once almost on the verge of being overtaken by CBDCs. In any country, if a central bank digital currency really exists, it is highly likely not built on a blockchain, at most it is built on some internal central bank consortium chain, which to be honest, is meaningless.
When CBDCs were at their peak, that was the most dangerous time for stablecoins.
If CBDCs had become a reality back then, stablecoins today would have been relentlessly suppressed into a dark corner, and blockchain would only be able to play a minimal role.
The remaining half-dead stablecoins would even have to learn the standards of central bank digital currencies, completely relinquishing their standard-setting power.
And now, stablecoins have won (or are about to).
Instead, everyone should learn the 【Blockchain + Token】 standard.
Nowadays, many blockchains actually have no meaningful applications on top, only stablecoin transfers. For example, with Aptos, the only scenario I use Aptos for is transfers between Binance and OKX.
And now, stablecoins will be legislated, what does that mean?
That's right, blockchain will become the only standard.
In the future, every stablecoin user will be the first to learn how to use a wallet.
As an aside, I actually think Ethereum's concerted push for EIP-7702 is quite forward-thinking. While other chains are all about memes, thank you Ethereum for sticking to account abstraction.
EIP-7702 is about Account Abstraction, which can support, for example:
· Social Account Registration Wallet
· Paying GAS with Native Coin
· And more
This paves the way for future new users to heavily use stablecoins, solving the last-mile problem.
Furthermore, once stablecoins receive legislative support, deposits and withdrawals will become even easier.
Let's imagine a scenario: previously, hindered by the gray nature of stablecoins, but after the bill passes, many traditional brokerages can support stablecoins themselves. The money from a US stock investor can be converted into stablecoins in minutes and instantly deposited into Coinbase. Believe it or not.
Let's imagine another scenario: if the brilliant bill smoothly passes through the House of Representatives, next, you will see:
Due to the extremely lucrative nature of this trading, existing stablecoin leaders and newly entering traditional giants will crazily start promoting their stablecoin products.
And an outsider, due to these promotions, will start using stablecoins. And then one day, after finding out that the wallet account has been created, will explore Bitcoin inside. Is mining Bitcoin difficult?
Stablecoins are a huge Trojan horse. The moment you start using stablecoins, you unwittingly step half a foot into the Crypto world.
As a large reservoir for digesting US debt, although stablecoins cannot directly absorb debt, they at least provide ammunition for the US debt secondary market. These functions are quite important, and slowly, stablecoins are becoming a part of the US debt market's body. Therefore, once the US legislation is passed and experiences the benefits, there is no turning back.
And, we are also confident that stablecoins are indeed one of the great innovations in our industry. People who have used stablecoins will find it hard to return to the traditional cash-banking system.
Once the bill is passed, users can't go back. In the future, concerns are about to be resolved, standards will be mastered, and the era of large deposits seems to be on the horizon.
Original Article Link
$COIN Joins S&P 500, but Coinbase Isn't Celebrating
On May 13, S&P Dow Jones Indices announced that Coinbase would officially replace Discover Financial Services in the S&P 500 on May 19. While other companies like Block and MicroStrategy, closely tied to Bitcoin, were already part of the S&P 500, Coinbase became the first cryptocurrency exchange whose primary business is in the index. This also signifies that cryptocurrency is gradually moving from the fringes to the mainstream in the U.S.
On the day of the announcement, Coinbase's stock price surged by 23%, surpassing the $250 mark. However, just 3 days later, Coinbase was hit by two consecutive events: a hack where employees were bribed to steal customer data and a demand for a $20 million ransom, and an investigation by the U.S. Securities and Exchange Commission (SEC) into the authenticity of its claim of having over 100 million "verified users" in its securities filings and marketing materials. These two events acted as mini-bombs, and at the time of writing, Coinbase's stock had already dropped by over 7.3%.
Coincidentally, Discover Financial Services, being replaced by Coinbase, can also be considered the "Coinbase" of the previous payment era. Discover is a U.S.-based digital banking and payment services company headquartered in Illinois, founded in 1960. Its payment network, Discover Network, is the fourth largest payment network apart from Visa, Mastercard, and American Express.
In April, after the approval of the acquisition of Discover by the sixth-largest U.S. bank, Capital One, this well-established digital banking company of over 60 years smoothly handed over its S&P 500 "seat" to this emerging cryptocurrency "bank." This unexpected coincidence also portrayed the handover between the new and old eras in Coinbase's entry into the S&P 500, resembling a relay race scene. However, this relay baton also brought Coinbase's accumulated "external troubles and internal strife" to a tipping point.
Over the past decade, cryptocurrency exchanges have been the most stable "profit machines." They play a role in providing liquidity to the entire industry and rely on trading fees to sustain their operations. However, with the comprehensive rollout of ETF products in the U.S. market, this profit model is facing unprecedented challenges. As the leader in the "American stack," with over 80% of its business coming from the U.S., Coinbase is most affected by this.
Starting from the approval of Bitcoin and Ethereum spot ETFs, traditional financial capital has significantly onboarded users and funds that originally belonged to exchanges in a more cost-effective, compliant, and transparent manner. The transaction fee revenue of cryptocurrency exchanges has started to decline, and this trend may further intensify in the coming months.
According to Coinbase's 2024 Q4 financial report, the platform's total trading revenue was $417 million, a 45% year-on-year decrease. The contribution of BTC and ETH's trading revenue dropped from 65% in the same period last year to less than 50%.
This decline is not a result of a decrease in market enthusiasm. In fact, since the approval of the Bitcoin ETF in January 2024, the inflow of BTC into the U.S. market has continued to reach new highs, with asset management giants like BlackRock and Fidelity rapidly expanding their management scale. Data shows that BlackRock's iShares Bitcoin ETF (IBIT) alone has surpassed $17 billion in assets under management. As of mid-May 2025, the cumulative net inflow of 11 major institutional Bitcoin spot ETFs on the market has exceeded $41.5 billion, with a total net asset value of $1214.69 billion, accounting for approximately 5.91% of the total Bitcoin market capitalization.
Institutional investors and some retail investors are shifting towards ETF products, partly due to compliance and tax considerations. On one hand, ETFs have much lower trading costs compared to cryptocurrency exchanges. While Coinbase's spot trading fee rate varies annually in a tiered manner but averages around 1.49%, for example, the management fee for IBIT ETF is only 0.25%, and the majority of ETF institution fees fluctuate around 0.15% to 0.25%.
In other words, the more rational users are, the more likely they are to move from exchanges to ETF products, especially for investors aiming for long-term holdings.
According to multiple sources, several institutions, including VanEck and Grayscale, have submitted applications to the SEC for a Solana (SOL) ETF, with some institutions also planning to submit an XRP ETF proposal. Once approved, this may trigger a new round of fund migration. According to a report submitted by Coinbase to the SEC, as of April, the platform's trading revenue from XRP and Solana accounted for 18% and 10%, nearly one-third of the platform's fee revenue.
However, the Bitcoin and Ethereum ETFs passed in 2024 also reduced the fees for these two tokens on Coinbase from 30% and 15% to 26% and 10%, respectively. If the SOL and XRP ETFs are approved, it will further undermine the core fee revenue of exchanges like Coinbase.
The expansion of ETF products is gradually weakening the financial intermediary status of cryptocurrency exchanges. From their original roles as matchmakers and clearers to now gradually becoming mere "on-ramps and off-ramps" for funds, exchanges are seeing their marginal value squeezed by ETFs.
On May 12, 2025, SEC Chairman Paul S. Atkins gave a keynote speech at the Tokenization and Cryptocurrency Working Group roundtable. The theme of his speech revolved around "It is a new day at the SEC," where he indicated that the SEC would not approach enforcement and regulation the same way as before but would instead pave the way for cryptocurrency assets in the U.S. market.
With signs of cryptocurrency compliance such as the SEC's "NEW DAY" declaration, an increasing number of traditional brokerages are attempting to enter the cryptocurrency industry. One of the most representative cases is the well-known U.S. brokerage Robinhood, which began expanding its crypto business in 2018. By the time of its IPO in 2021, Robinhood's crypto business revenue accounted for over 50% of the company, with a significant boost from the Dogecoin "moonshot" promoted by Musk.
In Q1 2025 earnings report, Robinhood showcased strong growth, especially in revenue from cryptocurrency and options trading. Fueled by Trump's Memecoin, cryptocurrency-related revenue reached $250 million, nearly doubling year-over-year. Consequently, Robinhood Gold subscription users reached 3.5 million, a 90% increase from the previous year, with the rapid growth of Robinhood Gold providing the company with a stable source of income.
Meanwhile, RobinHood is actively pursuing acquisitions in the cryptocurrency space. In 2024, it announced a $2 billion acquisition of the long-standing European cryptocurrency exchange Bitstamp. Additionally, Canada's largest cryptocurrency CEX, WonderFi, which recently went public on the Toronto Stock Exchange, also announced its integration with RobinHood Crypto. After obtaining virtual asset licenses in the UK, Canada, Singapore, and other markets, RobinHood has taken a proactive approach in the compliant cryptocurrency trading market.
Furthermore, an increasing number of brokerage firms are exploring the same path. Futu Securities, Tiger Brokers, and others are also dipping their toes into cryptocurrency trading, with some having applied for or obtained the VA license from the Hong Kong SFC. Although their user bases are currently small, traditional brokerages have a natural advantage in user trust, regulatory licenses, and low fee structures. This could pose a threat to native cryptocurrency platforms in the future.
In April 2025, security researchers discovered that some Coinbase user data was leaked on the dark web. While the platform initially responded by attributing it to a "technical misinformation," it still raised concerns among users regarding its security and privacy protection. Just two days before Dow Jones Indexes announced Coinbase's addition to the S&P 500 Index, on May 11, 2025, Coinbase received an email from an unknown threat actor claiming to have obtained customer account information and internal documents, demanding a $20 million ransom to keep the data private. Subsequent investigations confirmed the data breach.
Cybercriminals obtained the data by bribing overseas customer service agents and support staff, mainly in "non-U.S. regions such as India." These agents abused their access to Coinbase's internal customer support system and stole customer data. As early as February this year, blockchain detective ZachXBT revealed on X platform that between December 2024 and January 2025, Coinbase users lost over $65 million to social engineering scams, with the actual amount potentially higher.
Among the victims was a well-known figure, 67-year-old Ed Suman, an established artist in the art world for nearly two decades, having been involved in the creation of artworks such as Jeff Koons' "Balloon Dog" sculpture. Earlier this year, he fell victim to an impersonation scam involving fake Coinbase customer support, resulting in a loss of over $2 million in cryptocurrency. ZachXBT critiqued Coinbase for its inadequate handling of such scams, noting that other major exchanges have not faced similar issues and recommending Coinbase to enhance its security measures.
Amidst a series of ongoing social engineering incidents, although there has not been any impact on user assets at the technical level so far, it has raised concerns among many retail and institutional investors. Especially institutions holding massive assets on Coinbase. Just considering the U.S. BTC ETF institutions, as of mid-May 2025, they collectively hold nearly 840,000 BTC, and 75% of these are custodied by Coinbase. If we price BTC at $100,000, this amount reaches a staggering $63 billion, which is equivalent to the nominal GDP of two Iceland in the year 2024.
In addition, Coinbase Custody also serves over 300 institutional clients, including hedge funds, family offices, pension funds, and endowments. As of the Q1 2025 financial report, Coinbase's total assets under management (including institutional and retail clients) reached $404 billion. The specific amount of institutional custodied assets was not explicitly disclosed in the latest report, but it should still be over 50% based on the Q4 2024 report.
Once this security barrier is breached, not only could the rate of user attrition far exceed expectations, but more importantly, institutional trust in it would undermine the foundation of its business. Therefore, after a hacking event, Coinbase's stock price plummeted significantly.
Facing a decline in spot trading fee revenue, Coinbase is also accelerating its transformation, attempting to find growth opportunities in derivatives and emerging assets. Coinbase acquired a stake in the options platform Deribit at the end of 2024 and announced the official launch of perpetual contract products in 2025. This acquisition fills in Coinbase's gap in options trading and its relatively small global market share.
Deribit has a strong presence in non-U.S. markets, especially in Asia and Europe. The acquisition has enabled Coinbase to gain a dominant position in bitcoin and ethereum options trading on Deribit, accounting for approximately 80% of the global options trading volume, with daily trading volume remaining above $2 billion.
Meanwhile, 80-90% of Deribit's customer base consists of institutional investors, with their professionalism and liquidity in the Bitcoin and Ethereum options market highly favored by institutions. Coinbase's compliance advantage, coupled with its already robust institutional ecosystem, makes it even more suitable. By using institutions as an entry point, it can face the squeeze from giants like Binance and OKX in the derivatives market.
Facing a similar dilemma is Kraken, which is attempting to replicate Binance Futures' model in non-U.S. markets. Since the derivatives market relies more on professional users, fee rates are relatively higher and stickiness is stronger, making it a significant source of revenue for exchanges. In the first half of 2025, Kraken completed the acquisition of TradeStation Crypto and a futures exchange, aiming to build a complete derivatives trading ecosystem to hedge the risk of declining spot transaction fee income.
With the surge of Memecoin in 2024, Binance, OKX, and various CEX platforms began massively listing small-market-cap, highly volatile tokens to activate active trading users. Due to the wealth effect and trading activity of Memecoins, Coinbase was also forced to join the battle, successively listing popular tokens from the Solana ecosystem such as BOOK OF MEME and Dogwifhat. Although these coins are controversial, they are frequently traded, with fee rates several times higher than mainstream coins, serving as a "blood-boosting" method for spot trading.
However, due to its status as a publicly traded company, this practice is a riskier endeavor for Coinbase. Even in the current crypto-friendly environment, the SEC is still investigating whether tokens like SOL, ADA, and SAND constitute securities.
In addition to the forced transformation strategies carried out by the aforementioned CEXs, they are also starting to lay out RWAs and the most talked-about stablecoin payment fields, such as the PYUSD launched through a collaboration between Coinbase and Paypal, Coinbase's support for the Euro stablecoin EURC by Circle that complies with EU MiCA regulatory requirements, or the USD1 launched through a collaboration between Binance and WIFL. In the increasingly crowded trading field, many CEXs have shifted their focus from just the trading market to the application field.
The golden age of transaction fees has quietly ended, and the second half of the crypto exchange platform game has silently begun.
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Key Market Intelligence on May 14th, how much did you miss out on?
1.Binance Alpha Launches HIPPO, BLUE, and Other Tokens
2.Believe Ecosystem Tokens See General Rise, LAUNCHCOIN Surges Over 250% in 24 Hours
3.Tiger Securities Introduces Cryptocurrency Deposit and Withdrawal Service, Supports Mainstream Cryptocurrencies such as BTC and ETH
4.Current Bitcoin Rally Possibly Driven by Institutions, Retail Traders Yet to Join
5.Binance Wallet's New TGE Privasea AI Participation Requires a 198 Point Threshold, with a Point Consumption of 15
Source: Overheard on CT (tg: @overheardonct), Kaito
PUMP: Today's discussions about PUMP focus on its new creator revenue-sharing model: the platform will allocate 50% of PumpSwap revenue to token creators, sparking varied reactions from users. Some criticize the move as insufficient or even misleading, while others view it as a positive step the platform is taking to reward creators. Meanwhile, PUMP faces market pressure from emerging competitors like LetsBONKfun and Raydium, which are rapidly gaining market share. Users also express concerns about PUMP's sustainability and potential regulatory risks in the U.S., with discussions extending to the platform's impact on the entire memecoin ecosystem.
COINBASE: Today, Coinbase became the first crypto company to join the S&P 500 Index, replacing Discover Financial Services, sparking widespread industry attention. The entire crypto community views this milestone as a significant development, signaling that crypto assets are further integrating into the mainstream financial system. The news has sparked lively discussions on Twitter, with many users pointing out that this may attract more institutional investors to enter the Bitcoin and other cryptocurrency markets.
XRP: XRP became the focal point of today's crypto discussion, with its significant market movements and strategic advances drawing attention. XRP has surpassed USDT to become the third-largest cryptocurrency by market capitalization, sparking market excitement and discussions about its future potential. The surge in market capitalization and price is believed to be related to increasing institutional interest, deepening strategic partnerships, and its role in the crypto ecosystem. Additionally, XRP's integration into multiple financial systems and its potential as a macro asset class are also seen as key factors driving the current market sentiment.
DYDX: Today's discussions about DYDX mainly focused on the dYdX Yapper Leaderboard launched by KaitoAI. The leaderboard aims to identify the most active community participants, with a total of $150,000 in rewards to be distributed over the first three seasons. This initiative has sparked broad community participation, with many users discussing the potential rewards and the incentive effect on the DYDX ecosystem. Meanwhile, progress on the ethDYDX to dYdX native chain migration and historical airdrop events have also been topics of discussion.
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Overnight, the hottest narrative in the crypto space has become "Internet Capital Markets," with a host of crypto projects and founders, led by the Solana ecosystem's new Launchpad platform Believe, releasing this phrase. Together with "Believe in something," it has become the new slogan heralding the onset of a bull market. What exactly is the so-called "Internet Capital Market," will it become a short-lived hype phrase like the Base ecosystem's previous Content Coin, and what related targets are available for selection?2.《LaunchCoin Surges 20x in One Day, How Did Believe Create a $200M Market Cap Shiba Inu After Going to Zero?｜100x Retrospective》
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Never Underestimate the Significance of the US Stablecoin 'Infrastructure Bill'
If the US stablecoin bill, the "GENIUS Act," passes smoothly this time, its significance will be tremendous. I even think it's significant enough to enter the top five in Crypto history.
Although abbreviated as the GENIUS Act, which translates directly to the Genius Act, it is actually the Guiding and Establishing National Innovation for U.S. Stablecoins, which translates to "Guiding and Establishing National Innovation for US Dollar Stablecoins."
The proposal is lengthy, with several key points summarized for everyone:
· Mandatory 1:1 Full Asset Backing: Assets include cash, demand deposits, and short-term US Treasuries. At the same time, misappropriation and rehypothecation are strictly prohibited.
· High-Frequency Disclosure: Reserve reports must be published at least monthly, introducing external audits.
· Licensing Requirement: Once the circulating market cap of the issuer's stablecoin exceeds $100 billion, it must transition into the federal regulatory system within a specified timeframe, adopting banking-grade regulation.
· Introduction of Custody: The custodian of the stablecoin and its reserve assets must be a regulated qualified financial institution.
· Clear Definition as a Payment Medium: The bill explicitly defines stablecoin as a new type of payment medium, primarily regulated by the banking regulatory system, rather than restricted by the securities or commodities regulatory system.
· Embracing Existing Stablecoins: A maximum 18-month grace period after the bill's enactment, aimed at encouraging existing stablecoin issuers (such as USDT, USDC, etc.) to promptly obtain licenses or become compliant.
After finishing the main content, let's talk about the significance of this matter with an excited heart.
Over the years, when others asked, "After working in the Crypto industry for 16 years, what application have you created?"
In the future, you can confidently tell others—Stablecoins.
Some people have held opposing views. In the past, people's impression of stablecoins was that they were an opaque black box. Every few months, there would be FUD — whether Tether's assets were frozen or Circle had a significant black hole deficit.
In fact, if you think about it, Tether easily rakes in billions of dollars a year just from the interest on those underlying government bonds. Circle, slightly less, also made a $1.7 billion profit last year.
They basically made money while standing there. From a motivational standpoint, they have no malicious intentions. In fact, they are the most eager for compliance.
Now, this opaque black box will become a transparent white box.
In the past, the only complaint was that Tether's funds might have been frozen by the United States. Now, they will be directly placed into U.S. compliant custodial institutions, with high-frequency disclosures, so you can rest assured.
【No need to worry about a rug pull】 is such a huge advantage—I think especially all Crypto people understand this.
Stablecoins were once almost on the verge of being overtaken by CBDCs. In any country, if a central bank digital currency really exists, it is highly likely not built on a blockchain, at most it is built on some internal central bank consortium chain, which to be honest, is meaningless.
When CBDCs were at their peak, that was the most dangerous time for stablecoins.
If CBDCs had become a reality back then, stablecoins today would have been relentlessly suppressed into a dark corner, and blockchain would only be able to play a minimal role.
The remaining half-dead stablecoins would even have to learn the standards of central bank digital currencies, completely relinquishing their standard-setting power.
And now, stablecoins have won (or are about to).
Instead, everyone should learn the 【Blockchain + Token】 standard.
Nowadays, many blockchains actually have no meaningful applications on top, only stablecoin transfers. For example, with Aptos, the only scenario I use Aptos for is transfers between Binance and OKX.
And now, stablecoins will be legislated, what does that mean?
That's right, blockchain will become the only standard.
In the future, every stablecoin user will be the first to learn how to use a wallet.
As an aside, I actually think Ethereum's concerted push for EIP-7702 is quite forward-thinking. While other chains are all about memes, thank you Ethereum for sticking to account abstraction.
EIP-7702 is about Account Abstraction, which can support, for example:
· Social Account Registration Wallet
· Paying GAS with Native Coin
· And more
This paves the way for future new users to heavily use stablecoins, solving the last-mile problem.
Furthermore, once stablecoins receive legislative support, deposits and withdrawals will become even easier.
Let's imagine a scenario: previously, hindered by the gray nature of stablecoins, but after the bill passes, many traditional brokerages can support stablecoins themselves. The money from a US stock investor can be converted into stablecoins in minutes and instantly deposited into Coinbase. Believe it or not.
Let's imagine another scenario: if the brilliant bill smoothly passes through the House of Representatives, next, you will see:
Due to the extremely lucrative nature of this trading, existing stablecoin leaders and newly entering traditional giants will crazily start promoting their stablecoin products.
And an outsider, due to these promotions, will start using stablecoins. And then one day, after finding out that the wallet account has been created, will explore Bitcoin inside. Is mining Bitcoin difficult?
Stablecoins are a huge Trojan horse. The moment you start using stablecoins, you unwittingly step half a foot into the Crypto world.
As a large reservoir for digesting US debt, although stablecoins cannot directly absorb debt, they at least provide ammunition for the US debt secondary market. These functions are quite important, and slowly, stablecoins are becoming a part of the US debt market's body. Therefore, once the US legislation is passed and experiences the benefits, there is no turning back.
And, we are also confident that stablecoins are indeed one of the great innovations in our industry. People who have used stablecoins will find it hard to return to the traditional cash-banking system.
Once the bill is passed, users can't go back. In the future, concerns are about to be resolved, standards will be mastered, and the era of large deposits seems to be on the horizon.
Original Article Link
$COIN Joins S&P 500, but Coinbase Isn't Celebrating
On May 13, S&P Dow Jones Indices announced that Coinbase would officially replace Discover Financial Services in the S&P 500 on May 19. While other companies like Block and MicroStrategy, closely tied to Bitcoin, were already part of the S&P 500, Coinbase became the first cryptocurrency exchange whose primary business is in the index. This also signifies that cryptocurrency is gradually moving from the fringes to the mainstream in the U.S.
On the day of the announcement, Coinbase's stock price surged by 23%, surpassing the $250 mark. However, just 3 days later, Coinbase was hit by two consecutive events: a hack where employees were bribed to steal customer data and a demand for a $20 million ransom, and an investigation by the U.S. Securities and Exchange Commission (SEC) into the authenticity of its claim of having over 100 million "verified users" in its securities filings and marketing materials. These two events acted as mini-bombs, and at the time of writing, Coinbase's stock had already dropped by over 7.3%.
Coincidentally, Discover Financial Services, being replaced by Coinbase, can also be considered the "Coinbase" of the previous payment era. Discover is a U.S.-based digital banking and payment services company headquartered in Illinois, founded in 1960. Its payment network, Discover Network, is the fourth largest payment network apart from Visa, Mastercard, and American Express.
In April, after the approval of the acquisition of Discover by the sixth-largest U.S. bank, Capital One, this well-established digital banking company of over 60 years smoothly handed over its S&P 500 "seat" to this emerging cryptocurrency "bank." This unexpected coincidence also portrayed the handover between the new and old eras in Coinbase's entry into the S&P 500, resembling a relay race scene. However, this relay baton also brought Coinbase's accumulated "external troubles and internal strife" to a tipping point.
Over the past decade, cryptocurrency exchanges have been the most stable "profit machines." They play a role in providing liquidity to the entire industry and rely on trading fees to sustain their operations. However, with the comprehensive rollout of ETF products in the U.S. market, this profit model is facing unprecedented challenges. As the leader in the "American stack," with over 80% of its business coming from the U.S., Coinbase is most affected by this.
Starting from the approval of Bitcoin and Ethereum spot ETFs, traditional financial capital has significantly onboarded users and funds that originally belonged to exchanges in a more cost-effective, compliant, and transparent manner. The transaction fee revenue of cryptocurrency exchanges has started to decline, and this trend may further intensify in the coming months.
According to Coinbase's 2024 Q4 financial report, the platform's total trading revenue was $417 million, a 45% year-on-year decrease. The contribution of BTC and ETH's trading revenue dropped from 65% in the same period last year to less than 50%.
This decline is not a result of a decrease in market enthusiasm. In fact, since the approval of the Bitcoin ETF in January 2024, the inflow of BTC into the U.S. market has continued to reach new highs, with asset management giants like BlackRock and Fidelity rapidly expanding their management scale. Data shows that BlackRock's iShares Bitcoin ETF (IBIT) alone has surpassed $17 billion in assets under management. As of mid-May 2025, the cumulative net inflow of 11 major institutional Bitcoin spot ETFs on the market has exceeded $41.5 billion, with a total net asset value of $1214.69 billion, accounting for approximately 5.91% of the total Bitcoin market capitalization.
Institutional investors and some retail investors are shifting towards ETF products, partly due to compliance and tax considerations. On one hand, ETFs have much lower trading costs compared to cryptocurrency exchanges. While Coinbase's spot trading fee rate varies annually in a tiered manner but averages around 1.49%, for example, the management fee for IBIT ETF is only 0.25%, and the majority of ETF institution fees fluctuate around 0.15% to 0.25%.
In other words, the more rational users are, the more likely they are to move from exchanges to ETF products, especially for investors aiming for long-term holdings.
According to multiple sources, several institutions, including VanEck and Grayscale, have submitted applications to the SEC for a Solana (SOL) ETF, with some institutions also planning to submit an XRP ETF proposal. Once approved, this may trigger a new round of fund migration. According to a report submitted by Coinbase to the SEC, as of April, the platform's trading revenue from XRP and Solana accounted for 18% and 10%, nearly one-third of the platform's fee revenue.
However, the Bitcoin and Ethereum ETFs passed in 2024 also reduced the fees for these two tokens on Coinbase from 30% and 15% to 26% and 10%, respectively. If the SOL and XRP ETFs are approved, it will further undermine the core fee revenue of exchanges like Coinbase.
The expansion of ETF products is gradually weakening the financial intermediary status of cryptocurrency exchanges. From their original roles as matchmakers and clearers to now gradually becoming mere "on-ramps and off-ramps" for funds, exchanges are seeing their marginal value squeezed by ETFs.
On May 12, 2025, SEC Chairman Paul S. Atkins gave a keynote speech at the Tokenization and Cryptocurrency Working Group roundtable. The theme of his speech revolved around "It is a new day at the SEC," where he indicated that the SEC would not approach enforcement and regulation the same way as before but would instead pave the way for cryptocurrency assets in the U.S. market.
With signs of cryptocurrency compliance such as the SEC's "NEW DAY" declaration, an increasing number of traditional brokerages are attempting to enter the cryptocurrency industry. One of the most representative cases is the well-known U.S. brokerage Robinhood, which began expanding its crypto business in 2018. By the time of its IPO in 2021, Robinhood's crypto business revenue accounted for over 50% of the company, with a significant boost from the Dogecoin "moonshot" promoted by Musk.
In Q1 2025 earnings report, Robinhood showcased strong growth, especially in revenue from cryptocurrency and options trading. Fueled by Trump's Memecoin, cryptocurrency-related revenue reached $250 million, nearly doubling year-over-year. Consequently, Robinhood Gold subscription users reached 3.5 million, a 90% increase from the previous year, with the rapid growth of Robinhood Gold providing the company with a stable source of income.
Meanwhile, RobinHood is actively pursuing acquisitions in the cryptocurrency space. In 2024, it announced a $2 billion acquisition of the long-standing European cryptocurrency exchange Bitstamp. Additionally, Canada's largest cryptocurrency CEX, WonderFi, which recently went public on the Toronto Stock Exchange, also announced its integration with RobinHood Crypto. After obtaining virtual asset licenses in the UK, Canada, Singapore, and other markets, RobinHood has taken a proactive approach in the compliant cryptocurrency trading market.
Furthermore, an increasing number of brokerage firms are exploring the same path. Futu Securities, Tiger Brokers, and others are also dipping their toes into cryptocurrency trading, with some having applied for or obtained the VA license from the Hong Kong SFC. Although their user bases are currently small, traditional brokerages have a natural advantage in user trust, regulatory licenses, and low fee structures. This could pose a threat to native cryptocurrency platforms in the future.
In April 2025, security researchers discovered that some Coinbase user data was leaked on the dark web. While the platform initially responded by attributing it to a "technical misinformation," it still raised concerns among users regarding its security and privacy protection. Just two days before Dow Jones Indexes announced Coinbase's addition to the S&P 500 Index, on May 11, 2025, Coinbase received an email from an unknown threat actor claiming to have obtained customer account information and internal documents, demanding a $20 million ransom to keep the data private. Subsequent investigations confirmed the data breach.
Cybercriminals obtained the data by bribing overseas customer service agents and support staff, mainly in "non-U.S. regions such as India." These agents abused their access to Coinbase's internal customer support system and stole customer data. As early as February this year, blockchain detective ZachXBT revealed on X platform that between December 2024 and January 2025, Coinbase users lost over $65 million to social engineering scams, with the actual amount potentially higher.
Among the victims was a well-known figure, 67-year-old Ed Suman, an established artist in the art world for nearly two decades, having been involved in the creation of artworks such as Jeff Koons' "Balloon Dog" sculpture. Earlier this year, he fell victim to an impersonation scam involving fake Coinbase customer support, resulting in a loss of over $2 million in cryptocurrency. ZachXBT critiqued Coinbase for its inadequate handling of such scams, noting that other major exchanges have not faced similar issues and recommending Coinbase to enhance its security measures.
Amidst a series of ongoing social engineering incidents, although there has not been any impact on user assets at the technical level so far, it has raised concerns among many retail and institutional investors. Especially institutions holding massive assets on Coinbase. Just considering the U.S. BTC ETF institutions, as of mid-May 2025, they collectively hold nearly 840,000 BTC, and 75% of these are custodied by Coinbase. If we price BTC at $100,000, this amount reaches a staggering $63 billion, which is equivalent to the nominal GDP of two Iceland in the year 2024.
In addition, Coinbase Custody also serves over 300 institutional clients, including hedge funds, family offices, pension funds, and endowments. As of the Q1 2025 financial report, Coinbase's total assets under management (including institutional and retail clients) reached $404 billion. The specific amount of institutional custodied assets was not explicitly disclosed in the latest report, but it should still be over 50% based on the Q4 2024 report.
Once this security barrier is breached, not only could the rate of user attrition far exceed expectations, but more importantly, institutional trust in it would undermine the foundation of its business. Therefore, after a hacking event, Coinbase's stock price plummeted significantly.
Facing a decline in spot trading fee revenue, Coinbase is also accelerating its transformation, attempting to find growth opportunities in derivatives and emerging assets. Coinbase acquired a stake in the options platform Deribit at the end of 2024 and announced the official launch of perpetual contract products in 2025. This acquisition fills in Coinbase's gap in options trading and its relatively small global market share.
Deribit has a strong presence in non-U.S. markets, especially in Asia and Europe. The acquisition has enabled Coinbase to gain a dominant position in bitcoin and ethereum options trading on Deribit, accounting for approximately 80% of the global options trading volume, with daily trading volume remaining above $2 billion.
Meanwhile, 80-90% of Deribit's customer base consists of institutional investors, with their professionalism and liquidity in the Bitcoin and Ethereum options market highly favored by institutions. Coinbase's compliance advantage, coupled with its already robust institutional ecosystem, makes it even more suitable. By using institutions as an entry point, it can face the squeeze from giants like Binance and OKX in the derivatives market.
Facing a similar dilemma is Kraken, which is attempting to replicate Binance Futures' model in non-U.S. markets. Since the derivatives market relies more on professional users, fee rates are relatively higher and stickiness is stronger, making it a significant source of revenue for exchanges. In the first half of 2025, Kraken completed the acquisition of TradeStation Crypto and a futures exchange, aiming to build a complete derivatives trading ecosystem to hedge the risk of declining spot transaction fee income.
With the surge of Memecoin in 2024, Binance, OKX, and various CEX platforms began massively listing small-market-cap, highly volatile tokens to activate active trading users. Due to the wealth effect and trading activity of Memecoins, Coinbase was also forced to join the battle, successively listing popular tokens from the Solana ecosystem such as BOOK OF MEME and Dogwifhat. Although these coins are controversial, they are frequently traded, with fee rates several times higher than mainstream coins, serving as a "blood-boosting" method for spot trading.
However, due to its status as a publicly traded company, this practice is a riskier endeavor for Coinbase. Even in the current crypto-friendly environment, the SEC is still investigating whether tokens like SOL, ADA, and SAND constitute securities.
In addition to the forced transformation strategies carried out by the aforementioned CEXs, they are also starting to lay out RWAs and the most talked-about stablecoin payment fields, such as the PYUSD launched through a collaboration between Coinbase and Paypal, Coinbase's support for the Euro stablecoin EURC by Circle that complies with EU MiCA regulatory requirements, or the USD1 launched through a collaboration between Binance and WIFL. In the increasingly crowded trading field, many CEXs have shifted their focus from just the trading market to the application field.
The golden age of transaction fees has quietly ended, and the second half of the crypto exchange platform game has silently begun.
Arthur Hayes: Why I'm Betting on ETH While the Market Is Obsessed with SOL
May 16 Key Market Information Gap, A Must-Read! | Alpha Morning Report
Key Market Intelligence on May 14th, how much did you miss out on?
1.Binance Alpha Launches HIPPO, BLUE, and Other Tokens
2.Believe Ecosystem Tokens See General Rise, LAUNCHCOIN Surges Over 250% in 24 Hours
3.Tiger Securities Introduces Cryptocurrency Deposit and Withdrawal Service, Supports Mainstream Cryptocurrencies such as BTC and ETH
4.Current Bitcoin Rally Possibly Driven by Institutions, Retail Traders Yet to Join
5.Binance Wallet's New TGE Privasea AI Participation Requires a 198 Point Threshold, with a Point Consumption of 15
Source: Overheard on CT (tg: @overheardonct), Kaito
PUMP: Today's discussions about PUMP focus on its new creator revenue-sharing model: the platform will allocate 50% of PumpSwap revenue to token creators, sparking varied reactions from users. Some criticize the move as insufficient or even misleading, while others view it as a positive step the platform is taking to reward creators. Meanwhile, PUMP faces market pressure from emerging competitors like LetsBONKfun and Raydium, which are rapidly gaining market share. Users also express concerns about PUMP's sustainability and potential regulatory risks in the U.S., with discussions extending to the platform's impact on the entire memecoin ecosystem.
COINBASE: Today, Coinbase became the first crypto company to join the S&P 500 Index, replacing Discover Financial Services, sparking widespread industry attention. The entire crypto community views this milestone as a significant development, signaling that crypto assets are further integrating into the mainstream financial system. The news has sparked lively discussions on Twitter, with many users pointing out that this may attract more institutional investors to enter the Bitcoin and other cryptocurrency markets.
XRP: XRP became the focal point of today's crypto discussion, with its significant market movements and strategic advances drawing attention. XRP has surpassed USDT to become the third-largest cryptocurrency by market capitalization, sparking market excitement and discussions about its future potential. The surge in market capitalization and price is believed to be related to increasing institutional interest, deepening strategic partnerships, and its role in the crypto ecosystem. Additionally, XRP's integration into multiple financial systems and its potential as a macro asset class are also seen as key factors driving the current market sentiment.
DYDX: Today's discussions about DYDX mainly focused on the dYdX Yapper Leaderboard launched by KaitoAI. The leaderboard aims to identify the most active community participants, with a total of $150,000 in rewards to be distributed over the first three seasons. This initiative has sparked broad community participation, with many users discussing the potential rewards and the incentive effect on the DYDX ecosystem. Meanwhile, progress on the ethDYDX to dYdX native chain migration and historical airdrop events have also been topics of discussion.
1. "What Is 'ICM'? Holding Up the $4 Billion Market Cap Solana's New Narrative"
Overnight, the hottest narrative in the crypto space has become "Internet Capital Markets," with a host of crypto projects and founders, led by the Solana ecosystem's new Launchpad platform Believe, releasing this phrase. Together with "Believe in something," it has become the new slogan heralding the onset of a bull market. What exactly is the so-called "Internet Capital Market," will it become a short-lived hype phrase like the Base ecosystem's previous Content Coin, and what related targets are available for selection?2.《LaunchCoin Surges 20x in One Day, How Did Believe Create a $200M Market Cap Shiba Inu After Going to Zero?｜100x Retrospective》
LAUNCHCOIN broke through a $200 million market cap today, with the long-lost liquidity and such a high market cap "Memecoin" almost bringing half of the on-chain crypto community CT into the fray. The community is crazily discussing this token, with half of it being FOMO and the other half being FUD. This token, originally issued by Believe founder Ben Pasternak under his personal identity, transformed into a new platform token after a renaming. From once going to zero to a $200 million market cap, what happened in between?May 14 On-chain Fund Flow
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