Coalescing On Perplexity

As we close out the books on 2025, let's be real: this year has been a masterclass in CUD — Chaos, Uncertainty, and Delusion.

As we close out the books on 2025, let's be real: this year has been a masterclass in CUD—"Chaos, Uncertainty, and Delusion". Living through the Trump era of crypto is like riding a rollercoaster in the dark. We've had more pro-crypto announcements than we can count, yet every gain felt like it was being siphoned off by the next extraction scheme.

We started the year redlining the engine, only for the Tariff Terror to slam on the brakes. Then came the 10/10 liquidation event that left the market with a black eye we're still nursing. Just look at the 17th: Bitcoin pulled a $3,300 pump to incinerate $106 million in shorts, only to pivot 30 minutes later and dump $3,400 to wipe out $52 million in longs. We are being controlled, plain and simple.

We're currently trapped in a cage of our own making. While the Fed is readying the QE firehose to drown the banks in cash, the real question is: Is crypto becoming boring now?

The spotlight is shifting, and it's shining directly on AI. As we head into 2026, the market is bracing for "The Great Attention Theft." Huge potential IPOs are looming:

• SpaceX (The $1.5 Trillion orbital AI play)
• Anthropic & OpenAI

These aren't just listings; they are liquidity vacuums. They will suck the life and capital out of crypto faster than a perp liquidation. People are calling for $200k BTC, others are bracing for a retreat to the $50k range. The honest truth? Nobody knows anything. This year proved that volatility is the only certainty, and the "Perps Explosion" has turned the market into a casino where the house always seems to win.

My Strategy: The "Survival of the Fittest" Portfolio

We've moved into the "Bet on Everything" era of prediction markets, and already it's exhausting. Personally, I'm cutting through the noise and sticking to a battle-hardened DCA strategy: BTC, ETH, SOL, and ZEC.

I've also made a tactical swap: BNB is in, HYPE is out. While Hyperliquid has been the darling of the decentralized perp world, I'm not sold on it keeping the crown. With the SEC potentially opening the door for domestic perps, Binance could look to mirror its international exchange here in the US in 2026, the landscape is shifting.

Price Movements on the Week

• $BTC - Down 1.48% (+6.97% 30 days)
• $SOL - Down 5.55% (-0.89% 30 days)
• $ETH - Down 4.16% (+10.99% 30 days)
• $ZEC - Up 4.33% (-29.73% 30 days)
• $HYPE - Down 18.46% (-27.18% 30 days)
• Total Crypto Market Cap - Down 2.4% (+5.88% 30 days) - We are back under 3T.

The Bank of Japan just hiked rates to 0.75% – the highest in 30 years. Historically, every BOJ tightening has hit Bitcoin hard via yen carry trade unwinds: We've seen approximately 25-30% drops after the first two hikes. Keep an eye on volatility. In the past, this has led to prices going down significantly. This time around, it may have been priced in and was expected, but it's worth paying attention to. A yen carry trade involves borrowing money in Japan at zero to very low interest rates and investing those funds in US markets. The money is still cheap, but not as low as it has been.

I think I may have a crush on the SEC. This week, Paul Atkins said the administration seeks to shield citizens' lawful activities from bulk surveillance while allowing government to perform essential functions—balancing national security, civil liberties, and innovation.

Why choose an L1 instead of an L2? Rachel Mayer of Arc gave a solid explanation highlighting complexities that industry insiders take for granted. Trying to explain how an L2 works to an institution is extraordinarily difficult. The Ethereum community reacted negatively to Circle's decision to create their own L1.

Magic Eden announced that starting in February, stakers of $ME will receive rewards in $USDC from protocol revenue. They kicked off buybacks with validator revenue, expanded to marketplace revenue and are rolling out buybacks across every product in 2026. Now they're adding USDC rewards and tightening the token farm. This led many to suggest others should follow suit, like Jupiter. It makes sense for Magic Eden because they operate across multiple chains and tokens, normalizing USDC rewards. If Jupiter or similar companies did this, they'd constantly convert earned SOL to USDC. Rewarding in SOL directly, as DeFiTuna does, maintains better alignment.

Address poisoning represents a serious security risk. Those tiny deposits received after any on-chain transaction are sometimes crafted with addresses mimicking legitimate ones in hopes you'll copy the wrong address for future transfers. A victim lost $50 million in USDT this week. They conducted a test transaction for $50, which succeeded, then copied the poisoned address and sent the remaining $50 million. The funds instantly began flowing through Tornado Cash and disappeared.

Protection strategies:

• Use SNS or ENS names with your wallets
• Save frequently-used addresses in your wallet's address book
• Always select addresses from your saved list rather than copying new ones

In early December, Tom Lee publicly called for $300k Bitcoin and $20k Ethereum by 2026. However, an internal Fundstrat report from crypto head Sean Farrell indicated a base case projecting $BTC at $60K–$65K, $ETH at $1.8K–$2K, and $SOL at $50–$75 during the first half of 2026. Will significant downward pressure precede the anticipated rally?

The SEC held a roundtable on privacy this week. Commentary by Kirk Bos at approximately the 2:20 mark provides compelling reasoning for why privacy has become so prominent throughout 2025.

Tether introduced Pear Pass this week—a password manager storing your data on your device exclusively. No servers to compromise. No cloud to breach. The author hasn't had time to download and evaluate it but finds the concept intriguing.

An entire island nation moving on-chain? Absolutely. Crossmint is assisting The Marshall Islands in launching blockchain-based universal basic income, providing approximately 36,000 citizens with dollar-denominated tokens they can receive, store, and transfer peer-to-peer using their phones.

Black is the new pink? One forecast for 2026 predicts additional chains from the previous cycle will continue deteriorating. However, one might emerge with a successful repositioning (Cosmos, Polkadot, Algorand, Avalanche, or Polygon). This past week, Polkadot rebranded with a minimalist aesthetic. Meanwhile, Cosmos is experiencing significant activity as chains either leave or shut down operations—suggesting they're repositioning toward institutional focus in 2026. Both tokens have struggled this year: ATOM declined 69% and DOT dropped 73%. Those unfamiliar with these projects likely weren't participating in the previous cycle.

Visa announced that all US card issuers (banks, fintechs, crypto companies) can now settle directly using USDC. Cross River Bank and Lead Bank initiated USDC settlement over the Solana blockchain. Broader US availability is expected throughout 2026.

The quantum Bitcoin debate continued with disagreements between Nic Carter and Adam Back regarding urgency. Back, a Bitcoin pioneer, presents technically sound arguments about quantum threats and Bitcoin's options. Carter counters that Bitcoin's deliberately cautious development pace necessitates beginning this discussion immediately. Other blockchains and US government agencies are implementing post-quantum measures. The exact timeline remains speculative, and uncertainty about appropriate countermeasures introduces systemic risk. Carter has financial interest in a company addressing this issue, attracting accusations of self-promotion—though the stakes justify action regardless.

Meanwhile, the Solana Foundation is preparing for quantum threats by partnering with Project Eleven. Their CEO stated the mission focuses on protecting global digital assets from quantum risk. Solana proactively invested early, asked difficult questions, and took concrete steps today rather than waiting for quantum computing to become an immediate crisis. Results demonstrate that post-quantum security on Solana is achievable using current technology.

Coinbase announced major developments this week. The summary: they're evolving into an everything app, embracing neobank functionality similar to Robinhood. They'll offer perpetuals, prediction markets, stocks, direct deposit, and more. Simultaneously, the Base app emphasizes social features and tokenization of everything. Essentially, Robinhood increasingly resembles Coinbase with cryptocurrency integration, while Coinbase increasingly resembles Robinhood with stock offerings. By 2026, both will likely provide comprehensive options replacing traditional banking entirely. Additionally, they're launching custom stablecoins—likely becoming the new replacement for traditional points systems and loyalty programs. Consider holding "dtsUSDC" to earn returns versus holding alternative stablecoins.

Securitize has replaced synthetic wrappers and IOU structures with real, regulated shares issued on-chain and recorded directly on the issuer's capitalization table. Genuine stocks. Legitimate ownership.

RateX conducted their token generation event for $RTX this week. Users can verify allocations here: https://claim.rate-x.io

Official announcement: https://x.com/RateX_Dex/status/2000092302245806118?s=20

Thanks for reading,

Stay Free

• Ebullition