GM, frens! ☕️

Being down a little never feels great… but it’s part of the rhythm.

No one coasts upward forever, and sometimes the small dips are just reminders that you’re still in motion. Progress isn’t linear, it’s lumpy, and that’s fine 🫡 

Here’s what we’re watching this week:

• 🥷 Privacy coins pumping, EU preparing bans and programmable privacy

• 🔥 $WALLET scoreboard just appeared in Ambire

• ⏰ Shutdown over, market underwhelmed - clock hits Fear

• 🤯 China says the U.S. stole $13B in Chinese crypto

• 😿 The POPCAT hit on Hyperliquid - what actually happened

The W3oF Degen Portfolio knows the feeling.. slightly red, slightly annoyed, but very much alive 👀 

Join us in the Discord - where we’re coping constructively 🤠 

Privacy coins pumping, EU preparing bans and programmable privacy

Since May, reports out of Brussels say “anonymity enhancing” coins are about to be handled as hazardous material - pulled from licensed order books, wrapped in stricter KYC with custodians being brought under tighter control 👇️ 

Starting 2027, centralized exchanges and custodians in the EU would need to drop coins like XMR and ZEC from their platforms, prove stronger screening on deposits and withdrawals, and log more about flows that pass through them 🤔 

But back in May, it didn’t flip the meta overnight. No mass rotation into “soon to be banned” money laundering coins happened.

Only now, when everyone forgot all about it the search interest for “privacy” suddenly spiked and anonymity coins caught a surprising break. Nothing mystical changed in the tech, what changed actually was framing 🙃 

• Zcash became the biggest example by pumping over 1500% since then and over 700% since September 🤯 

• Two simple reasons: it got easier to use, and it got easier to trade. A zcash native wallet got an UX upgrade, which made shielded transfers feel less of a science project. Newer venues added ZEC perps and deeper spot. Result: attention, then price 💰️ 

• Plus, it actually became useful part of the anon coins narrative: privacy that’s not “nothing can be audited” but one with ability for selective disclosure: like viewing keys for the parties who need them, and zero knowledge proofs that show rules were followed without exposing counterparties (so more like, realistic adult privacy).

What builders and a16z are seeing

The product reality matches the thesis: consumer crypto needs private by default, transparent by choice mechanisms 📚️ 

• I.e wallets and chains that can produce proofs on demand instead of exhausting data by default. Systems where businesses can still prove facts - solvency, revenue, eligibility - without exposing their secret inside info 💾 

• This is where “programmable privacy” matters. Choosing what to reveal, to whom, and proving the rest with math.

A basic consumer point that gets lost in the dusty old “it’s all just crime” debate - normal people do not want their entire financial life to be public by default 🤷‍♂️ 

Some like Zcash sit close to that line, but whether you hold ZEC is secondary. What’s important is the counterexample to the lazy claim that privacy == non compliance == a scam of some sort.

It’s pretty simple - make chains less stalkable and you cut a ton of dumb crime - targeted phishing / harassment / wrench attacks / sniping on known wallets. Give people a way to move value without painting a target on their back and they actually stick around, build stuff, donate to causes. This is common sense 🤓 

For EU in this case, if it squeezes too hard, the talent and liquidity won’t magically vanish - they’ll ship their business somewhere else and Europe will be left auditing screenshots. That’s the real loss here.

$WALLET scoreboard just appeared in Ambire

Ambire just slipped a spoiler into everyone’s portfolio: projected $WALLET rewards now show up right inside the wallet 👛 

Season 1 runs through Dec 15, with claims to follow soon after 👇️ 

What’s actually being tallied here:

• Ambire’s Rewards season pays from a 20,000,000 $WALLET pool, distributed as $stkWALLET, with snapshots weighing two things over time: your XP level and your $WALLET/$stkWALLET balance across supported chains 💵 

• Projected rewards are that math rendered as a number you can see, instead of a mystery you argue about on Telegram.

• This is a part of Ambire’s onchain rewards program that tie actions to XP and nudge you toward real usage - swaps, bridging, governance, the usual wallet power features 🪙 

Why the timing matters

Governance just voted through changes meant to make Season 1 clearer and fairer - simpler entry, linear XP on key quests, and higher XP for governance itself - while keeping the core formula intact.

Season 1’s end date is locked for Dec 15, so the projection arriving now helps set expectations before the season closes 🧠 Make sure you join Rewards now!

Shutdown over, market underwhelmed - clock hits Fear

The US government turns the lights back on. The news headlines cheer but… prices barely twitch or even start gearing downwards 👎️ 

If you’ve been staring at the same line around the same ticker for days, that’s not your eyes glazing over - the markets are running on low octane.

What changed

• Spot ETFs flipped back to net inflows this week, roughly $300M in for BTC, after coughing up about $1.2B in outflows earlier. That stemmed the bleed and vacuumed supply while price crabbed 💸 

• Traders are waiting on the data backlog the shutdown delayed. CPI, jobs, and the usual reports are usually the real catalysts, but because of shutdown nothing was released.

So y no pump ser? Because catalysts for such things arrive with data, not bullish tweets.

While price went sideways, the Crypto Fear & Greed index cratered to 15 – deep “extreme fear.” The last sub 20 back in late February was followed by a hard dump toward the mid-70Ks a month later. At least that’s the bear case the doomers cite 🤷‍♂️ 

Here’s what’s also going on under the hood:

• Negative mentions across BTC, ETH, and XRP spiked (classic capitulation talk) 🗣️ 

• Sentiment flagged that when crowd negativity dominates, you’re usually near an exhaustion point.

• A few macro voices even floated a tactical downside first - one path has BTC going to $90K - but that’s still a setup that resolves higher if ETF demand keeps sipping coins and leverage stays contained 📩 

Leverage degens got cleaned out in October, the hot money left, and the remaining holders aren’t forced sellers. That’s what early bottoming phases look like.

So if it feels “heavy” it’s because (as sad as it is) - “shutdown over” - doesn’t constitute a trade in itself.

The big moves will come when the KOLs stops screaming and the data finally shows up.

China says the U.S. stole $13B in Chinese crypto

China just lobbed a fresh grenade across the cyber trench: a state report claims U.S. intelligence ran a “state level hacker operation” in December 2020 that drained 127,772 BTC from the LiBian mining pool 💣️ 

Back then it read as roughly $3B. In today’s prices that’s $13 Billion 💲 

The DOJ says the coins were lawfully seized as criminal proceeds tied to Cambodian “pig butchering” scams and to businessman Chen Zhi 👇️ 

On chain forensics at the time pointed at something far more boring than spycraft - a brittle wallet setup at LiBian.

• Analysts flagged a weak random number generator, the kind of mistake that lets attackers derive keys. The DOJ never spelled out how it got control of the keys. China calls it hacking, though 💀 

Why is this flaring now? 🤔 

First, prices makes old stories louder. $3B then is $13B now. And that’s alot.

Add a simmering U.S. China trade war, last month’s mutual hacking accusations, and crypto’s unique status as both transparent evidence and infinite Rorschach test, and you get what you get.

Cut through the theater and the lesson for regular crypto users lies beyond the political BS. It’s operational. Key management is the whole game. If your key can be guessed, your money is a suggestion 🗝️ 

And btw blockchains do not label transactions as righteous or not. They record signatures. Everything else happens offchain 😏 

The POPCAT hit on Hyperliquid - what actually happened

Memecoins don’t need smart contracts to break things - they use people. Add perps, smol brains thin books and a little stagecraft, and the target could be way bigger than regular traders 💰️ 

This was an attack on Hyperliquid’s backstop, not a random “cat coin dumped lol”: the plan was to whip up leverage on POPCAT, yank support, trigger a chain of liquidations, and make Hyperliquid’s insurance (the HLP pool) eat the other side. Bleed the pool 👇️ 

A single trader pulled about $3M in USDC off OKX and split it across roughly nineteen fresh addresses. That money marched into Hyperliquid and opened big POPCAT longs at 10x - around $30M of exposure sitting on a very jumpy asset 😸 

Next they built a prop 👷 

• On outside exchanges a fat buy wall appeared near $0.21. To anyone glancing at the book, it looked like real support. People chased. Price edged up, funding tightened, the perp side filled with eager longs. Now the mousetrap was loaded 🐭 

• Then the prop vanished. The wall was removed, POPCAT was pulled back, and the drop turned into a slide - from the low $0.20s into the low $0.10s in minutes.

• Liquidations fired in sequence. That’s the part where Hyperliquid’s HLP stepped in as designed: take the other side so the order book doesn’t snap and the exchange keeps functioning 📑 

The cost showed up fast. Postmortems put the HLP hit around $4.9M.

The instigator burned their own ~$3M stake in the process. So yes, the pool bled, and the arsonist got a bit scorched too.

The market theater was used as a crowbar: fake looking support to lure real buyers, a stack of leveraged longs underneath, then a rug on the signal to flip the whole book against itself. Faulty design did the rest 🥷 

You don’t need to trade to care. When a stunt like this lands, the bill rolls downhill - into insurance pools, into partner liquidity, into trust in the system even 😐️ 

Needless to say, if crypto wants to finally graduate from circus act to public utility, the tech should be built so a cat meme can’t shake the house. Keep the fun, harden the infrastructure.

Other worthy reads

An interesting observation by Route 2 Fi:

The Trustless Manifesto - Vitalik:

24 teams that were selected for Ethereum Founders Lab:

MEMES

That's all for now, frens.

We'll meet in a week! And remember, the market conditions are temporary, but our commitment to building a better Web3 is here to stay. Thanks for joining us, and we look forward to seeing you back next week. Cheers!

Yours, The 🔥 Team

Brought to you by Ambire: The Only Web3 Wallet That You’ll Need!