Welcome to Crypto Long & Short, our institutional newsletter. This week, we focus on the need to safeguard the individuals building DeFi infrastructure.
Jennifer Rosenthal, chief communications officer at the DeFi Education Fund, highlights the importance of protecting these builders, citing the introduction of the bipartisan Promoting Innovation in Blockchain Development Act of 2026 as a step in the right direction. Meanwhile, Alexis Sirkia, chairman and co-founder of Yellow Network, critiques Ethereum's Layer 2 strategy, arguing that it is flawed due to its focus on throughput rather than the movement of value between participants.
He proposes state channels as a potential solution, allowing for peer-to-peer transactions off-chain with the base layer serving as the enforcement mechanism. The newsletter also covers recent headlines, including the impact of smart contract exploits on the market and the shift of crypto derivatives volume into regulated venues.