Overview

In the latest edition of The Protocol, we delve into the unfolding scandal surrounding Movement, a notable crypto startup backed by Trump’s World Liberty Financial. Following a CoinDesk investigation, it came to light that the organization faced allegations of insider dealings amidst a planned $100 million funding round.

Key Articles in This Issue:

• Movement’s Token-Dump Scandal: Investigations reveal secret contracts and dubious advisors involved in transactions that have consequential impacts on market integrity.
• ETH Gas Limit Proposal: A new proposal aims to enhance Ethereum’s transaction capabilities significantly.
• Bitcoin Data Limit Debate Resurfaces: Discussions on the original data size limits ignite fierce debates reminiscent of last year’s controversies over Ordinals.
• Coinbase’s Base Network Update: Coinbase announces its progress towards decentralization, now achieving ‘stage 1’ roll-up status.

Detailed Analysis of Movement’s Controversy

Movement, which purportedly found itself entangled in a scandal, has been criticized for a questionable contract that seemingly allowed a mysterious middleman control over 66 million MOVE tokens. This led to a significant $38 million sell-off immediately following the token’s launch. Internal documentation reveals Rentech, a company lacking any digital footprints, involved in both sides of the deal, raising red flags regarding self-dealing practices. Initial reactions from the Movement team described the Rentech agreement as “possibly the worst” they had encountered, highlighting concerns from industry experts who noted this arrangement incentivized price manipulation before dumping tokens onto uninformed investors. The discord among Movement’s executives further complicates the situation as they face scrutiny for their roles despite previous objections.

Ethereum’s Gas Limit Proposal

Dankrad Feist from the Ethereum Foundation has introduced EIP-9698, suggesting an automatized escalation of the blockchain’s gas limit over the next four years. This proposal aims to ease the operational demands on validators, potentially raising the limit from 36 million units to around 3.6 billion—facilitating over 2,000 transactions per second.

Bitcoin Debates on Data Limitations

Amidst renewed conversations on Bitcoin’s data storage policies, developers propose relaxing current limitations on stored on-chain data, stirring discussions reminiscent of previous debates tied to the Ordinals controversy. Prominent developer Luke Dashjr criticized the potential easing of restrictions, warning that it could lead to detrimental outcomes for Bitcoin’s financial integrity.

Updates from Coinbase’s Base Network

Lastly, Coinbase has unveiled that its layer-2 solution, Base, has reached ‘stage 1’ roll-up status, a pivotal step in its decentralization process. The addition of a security council, comprising ten independent entities from various regions, marks significant progress in its operational autonomy. Tom Vieira, the head of the product, elaborated on the implications of this transition, aiming to lessen reliance on centralized institutions.

Stay tuned for further developments and insights into these topics as they evolve.