Welcome to Crypto Long & Short, your institutional newsletter. This week, we're focusing on the crucial aspect of protecting DeFi's infrastructure builders. Jennifer Rosenthal, chief communications officer at the DeFi Education Fund, emphasizes the need to shield these individuals to ensure the long-term viability of decentralized finance.
Meanwhile, Alexis Sirkia, chairman and co-founder of Yellow Network, analyzes the shortcomings of Ethereum's Layer 2 scaling strategy, arguing that it was flawed from the outset due to a fundamental misunderstanding of the network's limitations. As traditional finance companies increasingly engage with DeFi, it's essential to establish clear policies and regulations that foster innovation while mitigating risks.
The DeFi Education Fund invites you to join their efforts in defending the principles that make DeFi possible. In a separate article, Sirkia delves into the reasons behind the failure of Ethereum's Layer 2 strategy, citing the flawed assumption that the network's primary constraint was throughput. Instead, he argues that the true limitation lies in the way value is transferred between participants, and that state channels offer a more viable solution by enabling peer-to-peer transactions without the need for intermediaries. The newsletter also features an analysis of the recent market trends, including the impact of smart contract exploits on the crypto sector and the growing importance of regulated derivatives markets.
Don't miss our headlines of the week, chart of the week, and expert insights to stay up-to-date on the latest developments in the world of cryptocurrency and decentralized finance.