Hodler’s Digest, May 12-18 – Cointelegraph Magazine

This week's main news

Crypto trader turns $3K into $46M in one month as PEPE price rises.

The savvy trader made $46 million in profit, a 15,718-fold return on his initial investment of $3,000. An anonymous wallet bought 4.9 trillion PEPE for $3,000 on April 15th, which is currently worth over $56 million. The trader sold 1.41 trillion PEPE for $7.4 million and currently sits at 3.5 trillion PEPE, worth $38.9 million, according to a May 15 X post from Lookonchain. PEPE's market capitalization was around $4.5 billion on May 15, making it the third largest memecoin behind Dogecoin (DOGE) and Shiba Inu (SHIB).

Vitalik Buterin offers an adjustment of the Ethereum Gas model

Ethereum co-founder Vitalik Buterin proposed the Ethereum upgrade protocol EIP-7706, which introduces a new gas model for trading call data. This new charge will be separate from the existing gas charges for transaction processing and data storage. The proposal aims to reduce the cost of data-heavy but non-computationally intensive transactions by setting separate charges for call data, separate from the costs of executing contract code or storing data in “blobs”. If the proposal is accepted, the Ethereum network will be responsible for setting up call data costs independent of other costs.

Tornado Cash developer pleads guilty to money laundering.

Alexey Persev, the developer of the cryptocurrency mixing protocol TornadoCash, has been found guilty of money laundering, which has a major impact on open source code developers. The developer was sentenced to 5 years and 4 months in prison for defrauding the platform of illegal assets worth 1.2 billion dollars. The fine comes despite the fact that Tornado Cash is a non-custodial crypto hybrid protocol – meaning that funds passing through the protocol are never captured or monitored.

More than 600 firms have shown billions in combined investments in Bitcoin ETFs.

Last week, more than 600 firms disclosed significant investments in Bitcoin exchange-traded funds (ETFs) in their 13F filings with the United States Securities and Exchange Commission. According to the data, professional investment firms reported owning $3.5 billion worth of Bitcoin ETFs. Among them, Morgan Stanley, JPMorgan, Wells Fargo, UBS, BNP Paribas, Royal Bank of Canada and others such as Millennium Management and Schoenfeld Strategic Advisors are the largest BTC ETF investors with an investment of $1.9 billion.

Sam Altman thinks giving everyone a ‘piece of GPT' could pay for UBI

Sam Altman, CEO of OpenAI and Chair of Tools For Humanity, suggested a new approach to Universal Basic Income (UBI) using “computation” as a resource. In a recent episode of the All-In podcast, Altman discussed how advances in AI will change socioeconomics and possibly replace traditional cash income with a system where everyone uses computing resources. The executive suggested that individuals could use their allocated computing power from powerful AI systems like GPT-7 for personal use, sell it, or give it away for purposes like cancer research.

Winners and losers

At the end of the week, Bitcoin (BTC) at $66,662, Ether (ETH) at $3,081 and XRP at $0.52. According to CoinMarketCap, the total market cap is $2.41 trillion.

Among the largest 100 cryptocurrencies, the top three altcoin gainers for the week were FLOKI (FLOKI) at 24.25%, Pepe (PEPE) at 23.52% and Chainlink (LINK) at 15.95%.

The top three altcoin losers of the week were Etena (ENA) at -14.47%, Worldcoin (WLD) at -11.28% and Render (RNDR) at -9.40%.

Be sure to read Cointelegraph's market analysis for more information on crypto prices.

The most memorable quotes

I think like these two technologies [crypto and AI] Development, you can create agents that combine the power of both. We are scratching the surface.”

Yorke Rhodes, director of digital transformation, blockchain and cloud supply chain at Microsoft

“Gambling has been around since the earliest days of human life. People like to take risks. Crypto is the epitome of this.

Zach Bruch, founder and CEO of MyPrize

“The SEC is turning cryptocurrency regulation into a political football, forcing President Biden to choose sides on an issue important to many Americans.”

Willie Nickell, US Rep

“The US government is going after Tether, that's clear to me.”

Ripple CEO Brad Garlinghouse

“Privacy is a core value of Bitcoin. It is not a crime to mix oneself up. […] It's like punishing the one who uses the knife, not the one who invented it.

CryptoQuant founder and CEO Ki Yang Ju

“Republicans will smell blood in the water and turn to crypto. Biden won't have much time to save it.”

Hayden Adams, Founder and CEO of Uniswap

Forecast of the week

Bitcoin moves to higher territory but the initial traders are watching from the sidelines

According to Charles Edwards, founder of Capriole Investments, stock and crypto market seasonality, along with Bitcoin on-chain data, suggest that the price of BTC may consolidate in four to five months.

In a new report, Edwards says bitcoin continues to oscillate in the cyclical range of $58,000-65,000, consistently closing above $58,000 each week as “sustained support for the long-term trend.”

He likens BTC's price action to that of gold, which has formed a “giant cup and holder” pattern over the past 13 years since the “cup” lasting four years, and explains how Bitcoin shows a similar chart pattern.

Given the similarities between Bitcoin and gold, Edwards said there's a chance that BTC could spend “up to 9 months in a range high before a cup to the upside.” he said:

As long as the price doesn't exceed $58,000, the technical figure will be ridiculous. The more we spend at high altitudes, the more likely this structure will merge into the classic ‘cup and handle' design, which typically indicates strong price appreciation.

FUD of the week

The filing suggests that the SEC is investigating reasons to separate Ether ETFs

Analysts have obtained a March filing from the US Securities and Exchange Commission that suggests the regulator may consider Ether a security. Davis Polk & Wardwell Associate Scott Johnson analyzed BlackRock's March 4 filing regarding its application to list an ether exchange-traded fund (ETF) on Nasdaq. The filing extended the SEC's decision deadline until June and asked for public comment on whether the ETF should be classified as a commodity. Johnson pointed out that ETFs could be rejected if the filings were to be classified as securities rather than commodity trust shares.

Coinbase's website is down when the crypto exchange mentions a ‘system-wide outage'

Crypto exchange Coinbase has experienced a “system-wide outage,” rendering its services unavailable to those looking to access the crypto exchange on desktop or mobile. Coinbase notified users of the outage on May 14 at 4:15 a.m. UTC, sharing that the outage began. The outage lasted for about three hours.

Memecoin startup pump.fun claims ex-employee behind $1.9M exploit

Solana memecoin creation tool pump.fun claims a former employee defrauded the company of nearly $2 million in a “Bonding Curve” attack. The ex-employee was sued in a May 16 X post on Pam.Fun for using “privileged rights” to obtain “removal authority” and compromise the protocol's internal systems. Of the total $45 million held in Pump.fun Bonding Curve contracts, $1.9 million was stolen. The platform has temporarily stopped trading, but is now back up and running. Pump.fun's smart contracts are “safe” and affected users will receive “100% liquidation” within the next 24 hours, according to the pump.fun team.

The best magazine sections of the week

UK cannabis millionaire legal ‘on wheels' deals via crypto

Maximilian White, the owner of Europe's largest medical marijuana business, now embraces crypto and blockchain.

OpenAI's ‘iPhone moment' Google, AI lies, porn and dating: AI powers the eye.

OpenAI's voice assistant powers up Google, plus why do AIs lie… and date each other? AI eye.

Bybit Notcoin Crash, Chinese Company Gains 12x After Crypto Buyout: Asia Express

Baybit CEO apologizes for Notcoin listing woes, Hong Kong crypto ETFs disappointed, Chinese company's profits surge 1100% after crypto buyout

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Cointelegraph magazine writers and reporters contributed to this article.