Renzo’s EzETH Depegs and Causes $56M in Liquidations

Renzo’s EzETH Depegs and Causes $56m in Liquidations

Renzo Protocol’s ezETH, a $3 billion restaking token, experienced a sharp depegging causing over $50 million in DeFi liquidations. The depeg occurred following a controversial announcement about the tokenomics of Renzo’s governance token, REZ, which allocated only 5% to ezETH holders and 2.5% to Binance launchpool participants, leading to dissatisfaction and a sell-off. Unable to directly withdraw to the underlying assets, traders exited via a low liquidity pool, triggering a cascade of liquidations. 

In response to community backlash and the temporary depegging of its ezETH token, Renzo Protocol has revised its initial airdrop plan, increasing the token allocation from 5% to 7% for the first airdrop phase. A total of 12% of Renzo’s 10 billion token supply will now be distributed to users over two phases. Additionally, the claim date for the first airdrop is set strategically just an hour before Renzo’s listing on the Binance exchange on April 30th. 

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Layer 2s are Choosing Avail for Data Availability 

Arbitrum, Optimism, Polygon, StarkWare, and zkSync are set to incorporate Avail’s data availability layer into their platforms, following Avail’s upcoming mainnet launch. This integration aims to enhance the scalability, efficiency, and flexibility for developers working on these Layer 2 projects. 

Avail provides a foundational layer that ensures transaction data is readily accessible, which is crucial for maintaining the security and accuracy of transactions across different blockchain environments. This move is expected to support more seamless and interconnected operations within the Ethereum blockchain ecosystem, addressing key challenges like data bottlenecks and improving overall network performance.

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DOJ Arrests Founders of Samourai Wallet Mixer

The co-founders of Samourai Wallet, a cryptocurrency mixer, have been arrested by U.S. authorities on charges related to money laundering and operating without a proper license. The arrests are part of a broader crackdown on crypto mixers, which have been implicated in processing illegal transactions totaling over $2 billion and facilitating $100 million in money laundering activities. 

The U.S. Justice Department alleges that Samourai Wallet’s services, including its Whirlpool and Ricochet features, were used to obscure the origins of illicit funds from dark web markets and other fraudulent activities. The actions against Samourai Wallet come amid increasing regulatory scrutiny of cryptocurrency operations linked to financial crimes.

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EU’s Anti-Money Laundering Bill Passes Final Vote

The European Parliament recently approved a new anti-money laundering bill that imposes stricter due diligence measures for crypto asset service providers (CASPs), including identity checks and the obligation to report suspicious activities. This legislation will particularly affect centralized crypto exchanges and extends to other sectors like gambling. 

Despite earlier concerns, the law will not ban anonymous crypto wallets but will require CASPs to adhere to existing KYC/AML standards under the MiCA framework. The new rules are set to formally be adopted by the Council of the EU and will come into effect three years later, marking a significant regulatory step for the crypto industry in Europe.

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Other breaking news

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• CryptoPunk Sells for $12.41 Million, Ranking as Sixth Most Expensive Ever
• Data Shows BlackRock’s Bitcoin ETF Inflows Halt Following 71-Day Streak
• US SEC Expected to Reject Spot Ether ETFs in May

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