Bad news: Bitcoin has dropped below $70K after Treasury Secretary Scott Bessent told Congress he has no authority to “bail out crypto.“

Worse news: Galaxy Digital thinks BTC could go as low as $58K, which is its 200-day moving average.

Even worse news: Michael Burry of The Big Short fame predicted that things could get very ugly if BTC went below $70K, using such choice language as “sickening scenarios” and “death spiral.”

Lovely.

Unfortunately, the only glimmer of positive news we can offer on Bitcoin at the moment is that Galaxy Digital thinks this continued selloff might be long-term holders still taking profit.

Which is, admittedly, hard to swallow when Bitcoin is down 45% over the past four months. Emotionally that does not scream “profit taking” to us. It feels more like a loss of conviction.

And yet. This doesn’t mean that Bitcoin is over or dead or washed up. Ok, it might be washed up right now, but that doesn’t mean it will stay that way forever.

But remember: Bitcoin has always eventually hit new all-time highs. History doesn't guarantee the future, but it's worth noting (current all-time high: $126,198.07). We aren’t making guarantees and this isn’t financial advice.

Vitalik Buterin, Ethereum’s co-creator, just told everyone why Ethereum Layer-2 chains are no longer needed. What?

Let us explain.

First: a Layer-2 protocol is a secondary blockchain built on top of a Layer 1 (like Ethereum) that improves the main chain’s performance by executing transactions (Txs) off-chain. That makes for faster and cheaper Txs.

But Buterin has effectively declared the end of Ethereum’s Layer-2 (L2) era with two key claims:

So does Ethereum’s creator hate L2s now?

No, it doesn’t seem that way. He even laid out advice for how L2s could differentiate moving forward, like by doing more than just scaling and focusing on interoperability. Not exactly easy to pivot on a dime to those ideals, but it’s something.

But the crazy thing is that by announcing the end of Ethereum Layer-2 chains’ usefulness as we know it, Vitalik is indirectly calling out Coinbase’s Base L2 chain, which currently does 60% of all layer-2 revenue (over $75M in 2025 alone).

However, Coinbase seems somewhat aware of this sea change for L2s. Base’s lead developer Jesse Pollak stated he agrees that L2s must be more than just “Ethereum but cheaper” moving forward.

Rep. Ro Khanna is launching a probe into a UAE royal family member’s $500M investment (49% ownership) in Trump’s crypto company. 

The investment happened just days before Trump’s inauguration, and a few months later, the UAE was cleared to buy AI chips from the US. And a lot of people are calling the whole thing fishy.

The royal family member who invested is Sheikh Tahnoon, also known as the “Spy Sheik.” He’s the brother of the UAE’s President, Mohamed bin Zayed Al Nahyan, and he also serves as the country’s national security adviser. Tahnoon oversees G42, a major investment/tech vehicle.

The argument goes something like this: the US had refused to sell AI chips to the G42 because of its alleged ties to China… until the UAE began to invest in businesses within President Trump’s network.

The timing suggests something like bribery, or at least that’s the way Khanna seems to see it.

Nothing’s for sure, and this is only a theory that Rep. Khanna is presenting. But we’ll let you know if anything comes of it.

We really appreciate you reading our newsletter, and we’d love to hear your feedback.

All we can say is man, we’re glad we aren’t Michael Saylor right now.

Same time next week? Sounds good.

Until next time,
- The Chain Team

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