Safeguarding DeFi Infrastructure Builders

Welcome to Crypto Long & Short, our institutional newsletter. This week, we focus on the need to safeguard the people behind DeFi infrastructure. Jennifer Rosenthal, chief communications officer at the DeFi Education Fund, emphasizes the importance of protecting open-source, permissionless, programmable, noncustodial, globally accessible, and interoperable technology. As traditional finance companies increasingly adopt DeFi-related initiatives, it is crucial to defend key policy objectives. One such objective is software developer protection, which has been a topic of discussion in recent market structure and crypto policy talks. The bipartisan Promoting Innovation in Blockchain Development Act of 2026 aims to protect software developers from misclassification under criminal code Section 1960. Meanwhile, Alexis Sirkia, chairman and co-founder of Yellow Network, comments on Ethereum's L2 strategy, arguing that the rollup model was flawed from the start, as it addressed congestion by creating parallel execution environments that led to isolated liquidity pools. State channels, which enable peer-to-peer transactions off-chain, may offer a more viable solution. The week's headlines highlight the growing connections between traditional finance and crypto, as well as the impact of smart contract exploits on the market.