Safeguarding DeFi's Infrastructure Builders

Welcome to Crypto Long & Short, our institutional newsletter. This week, we focus on the crucial aspect of protecting the people building DeFi infrastructure. Jennifer Rosenthal, chief communications officer at the DeFi Education Fund, highlights the importance of safeguarding these individuals, citing the introduction of the bipartisan Promoting Innovation in Blockchain Development Act of 2026, which aims to protect software developers from misclassification under criminal code. Meanwhile, Alexis Sirkia discusses the limitations of Ethereum's L2 strategy, arguing that the rollup model was flawed from the start due to its focus on throughput rather than the movement of value between participants. He proposes state channels as a superior solution, enabling peer-to-peer transactions off-chain with the base layer serving as the enforcement mechanism. Other topics include the CFTC's preparation to approve the first U.S. framework for perpetual futures and the impact of smart contract exploits on the market.