Welcome to a summary of key developments in cryptocurrency technology this week.
In this issue:
- Ethereum developers are getting ready for a second upgrade in 2025 called Fusaka.
- New research indicates that AI agents are nearing the ability to execute real-world DeFi attacks.
- Developers are advocating for a zero-knowledge “Secret Santa” matching system on Ethereum.
- Bitnomial is set to launch the first CFTC-regulated spot crypto market.
Network News
Fusaka Launches on Ethereum: Ethereum developers are gearing up for a network upgrade, Fusaka, which starts today and is planned for 2025. This upgrade, merging elements from Fulu and Osaka, involves changes in both the consensus and execution layers. The aim is to enhance Ethereum’s capability to manage substantial transaction loads from layer 2 chains. Fusaka features 12 code adjustments, known as Ethereum Improvement Proposals (EIPs), aimed at improving the speed and affordability of Layer 2 transactions. A significant innovation here is PeerDAS, which enables validators to check only specific data segments instead of entire datasets, thus lowering bandwidth usage and costs for validators and Layer 2 infrastructures. Currently, Layer 2 sends masses of transactions to Ethereum, requiring validators to download all data from a “blob” for accuracy, leading to delays. With this enhancement, validators will only validate parts of the blob, hastening processes and cutting fees.
Research on DeFi AI Agents: Recent research suggests AI agents can now identify vulnerabilities in smart contracts and may be exploited for malicious intents. The study, backed by the Anthropic Fellows program, utilized a dataset reflecting 405 compromised contracts. Models like GPT-5 and others simulated $4.6 million in potential exploits. Notably, these AI systems weren’t just identifying flaws; they developed complete scripts for exploitation, mimicking real attacks on Ethereum and BNB Chain. Furthermore, efforts to explore unexploited vulnerabilities showed they uncovered two significant issues, one relating to a missing modifier allowing users to alter token balances, while the other let unauthorized recipients divert fee withdrawals.
Privacy Protocol Development: Ethereum developers are honing a zero-knowledge protocol aimed at enhancing privacy in on-chain interactions. This includes a “Secret Santa”-style matching system intended for anonymous gift exchanges, presenting some challenges like ensuring true randomness and preventing duplicate registrations. The underlying principle uses zero-knowledge proofs to authenticate interactions without disclosing identities. In the proposed model, participants would register and commit unique signatures to avoid duplicates while contributing random numbers anonymously. Recipients would then encrypt their delivery details so that only they could access them.
Bitnomial’s Spot Trading Launch: Bitnomial, based in Chicago, is about to introduce the first CFTC-regulated spot cryptocurrency market. The exchange’s self-certification rules are now live, allowing it to offer both leveraged and non-leveraged crypto products. This means that customers can buy and sell digital assets on a federally regulated platform, marking a significant development in the U.S. crypto market. Acting CFTC Commissioner Caroline Pham noted ongoing discussions with various stakeholders about launching spot crypto products. This approval could open doors for other exchanges seeking similar regulations.
In Other News
- Kalsi, a prediction market in the U.S., has closed a $1 billion funding round, achieving a valuation of about $11 billion. The round was led by Paradigm, with notable participation from Sequoia Capital. Kalsi, which allows users to trade binary event contracts on future events, saw substantial trading volume, surpassing its competitor Polymarket.
- Antithesis, a startup from Northern Virginia, has secured $105 million in Series A funding, emphasizing the necessity of stress testing decentralized systems for blockchain. Their platform aims to run simulations to identify potential failures before they occur in real networks.
Regulation and Policy
- The UK has officially classified cryptocurrencies as property following recent legislation. This new law introduces a category for digital assets, including cryptocurrencies and NFTs, reflecting a significant step in their legal recognition and boosting user confidence in the market.
- Poland’s President, Karol Nawrocki, has vetoed a bill designed to align with EU regulations on cryptocurrency, citing concerns it could lead to excessive governmental control over the market.
Calendar
- December 11th-13th: Solana Breakpoint, Abu Dhabi
- February 10-12, 2026: Consensus, Hong Kong
- February 17-21, 2026: ESDenver, Denver
- March 30th – April 1, 2026: EthCC, Cannes
- April 15-16, 2026: Paris Blockchain Week, Paris
- May 5-7, 2026: Consensus, Miami
