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DOGE $0.0937 -2.90%
ADA $0.2454 -3.03%
BCH $440.14 -1.80%
LINK $9.14 -2.91%
HYPE $43.01 -3.28%
AAVE $92.97 -17.22%
SUI $0.9426 -3.30%
XLM $0.1676 -1.02%
ZEC $324.89 -0.58%

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Spark: The delisting of rsETH assets in January had caused strong dissatisfaction among ETH leveraged users, but it has now been proven to be a prudent strategy

The head of the Spark Protocol strategy, monetsupply.eth, posted on platform X stating that in January of this year, low-usage assets like rsETH were removed and collateral and functionality were continuously tightened. This move sparked strong dissatisfaction among "ETH leveraged" users at the time.Additionally, Spark has long set a high upper limit on interest rates in the ETH lending market, transferring some business and revenue to Aave over the past year (where its ETH borrowing rate once dropped to 10% or below). However, in the current market crisis environment, this strategy has proven to be more prudent. Currently, SparkLend still maintains sufficient ETH withdrawal liquidity, while Aave has experienced liquidity tightness and even "lock-up" situations in the Ethereum mainnet and multi-chain markets like Arbitrum and Base.monetsupply.eth further warned that since ETH is the core collateral asset, when market utilization reaches 100%, collateral liquidation will not be able to execute normally. The depletion of liquidity not only affects the depositor experience but may also pose systemic risks. In the current situation of insufficient liquidity in Aave, a 15%-20% drop in ETH prices could lead to significant bad debt accumulation (in addition to the potential impact of the rsETH incident).

Core member of the Ethereum Foundation, Josh Stark, will be leaving, having led several major upgrades including The Merge

According to The Block, Josh Stark, a key figure at the Ethereum Foundation (EF), announced his resignation after five years and will officially step down at the end of the month. Stark joined the Ethereum Foundation in 2019, initially working in the special projects team, and later rose to leadership, collaborating with EF Chair Aya Miyaguchi, Ethereum founder Vitalik Buterin, and co-executive directors Hsiao-Wei Wang and Bastian Aue.He is one of the most prominent members of the foundation's external image and has led several significant advancements in Ethereum, including the "The Merge" upgrade that transitioned from proof of work to proof of stake, as well as subsequent upgrades like Dencun, Fusaka, and Pectra. During last year's leadership adjustments at the foundation, he was appointed as the "co-manager" of the EF board and recently took on the role of co-chair of the "trillion-dollar security" initiative.Last month, Stark co-authored a strategic blog post on Ethereum with Josh Rudolf and Julian Ma, outlining Ethereum's latest scaling direction and its relationship with the Layer 2 ecosystem. Stark stated, "I haven't planned for the future yet; I just want to take a good rest and spend time with family and friends." This resignation occurs against the backdrop of ongoing changes at the Ethereum Foundation.Last year, the foundation underwent significant leadership adjustments, refocusing its strategic priorities on scaling the Ethereum mainnet and core cypherpunk values; Tomasz K. Stańczak also resigned from his co-executive director position at the end of February this year, having served for less than a year. On the same day, Trent Van Epps also announced his departure from EF to fully dedicate himself to Protocol Guild, the independent funding organization for Ethereum core developers that he founded.

The American Bankers Association warns: Allowing stablecoins to pay interest will accelerate deposit outflows and severely impact community bank lending

According to an article in the American Bankers Association (ABA) Journal, experts including the ABA's chief economist point out that the recent research report by the White House Council of Economic Advisers (CEA) on the issuance of yield from payment stablecoins raises the wrong questions and may mislead policymakers.The CEA report mainly explores "how prohibiting the issuance of yield from payment stablecoins will affect bank lending," concluding that banning yields would only increase bank lending by about $1.2 billion, with minimal impact.However, the ABA believes that the real policy concern is not the consequences of "prohibition," but the risks that may arise from "allowing" the issuance of yield from payment stablecoins: accelerating deposit outflows, allowing yields to stimulate households and businesses to move funds from bank deposits (especially community banks) to stablecoins, which would have a significant impact when the market size expands to $1-2 trillion. ABA analysis shows that loans in Iowa alone could decrease by $4.4 billion to $8.7 billion as a result.Impact on community banks: Deposit outflows will force community banks to replace funding with higher-cost wholesale financing (such as Federal Home Loan Bank advances), raising their funding costs and thereby reducing loans to local households and small businesses. It is not a harmless "reshuffling": The CEA believes that deposits are merely "reshuffled" within the banking system, with overall impact being minimal.However, the ABA points out that deposits flowing from community banks to a few large institutions or stablecoin reserve accounts will harm sectors that rely on relationship-based bank lending. The ABA believes that prohibiting the issuance of yield from payment stablecoins is a prudent protective measure that allows stablecoins to mature as a tool for payment innovation rather than becoming a source of economic risk that substitutes for insured deposits.
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