TLDR Crypto 2025-01-02

China has introduced stricter foreign exchange rules requiring banks to monitor and report risky activities, including crypto-related cross-border transactions, by tracking user identities, fund sources, and trading frequencies. Despite its long-standing anti-crypto stance, China remains the second-largest Bitcoin holder globally, mainly because of the government's seizing assets tied to illegal activities.

The IRS has issued temporary relief on crypto cost-basis method changes until December 31. This will allow crypto holders on centralized exchanges to avoid being defaulted to the FIFO (First In, First Out) accounting method, which could increase capital gains taxes. This delay gives brokers time to support alternative methods like HIFO or Spec ID, while crypto taxpayers can maintain their own records in the meantime.

Peanut Protocol revolutionizes Web3 payments by replacing complex wallet addresses with secure link-based transfers, enabling frictionless, cross-chain, and fiat-to-crypto transactions for use cases like group payments, freelancing, and e-commerce. Its user-friendly design aims to simplify crypto payments while addressing security concerns.

EZKL is advancing DeFi using zero-knowledge proofs for convex optimization problems, allowing complex trading strategies and calculations to be executed offchain while maintaining onchain verification. COCSwap, a hackathon example, implements advanced AMM strategies, though at significantly higher gas costs. Beyond AMMs, EZKL's approach to proving optimization solutions has broader applications in portfolio management and control systems and could shift how complex financial calculations are implemented in DeFi.

2025 is set to be a significant year for crypto, with this set of predictions speculating that the US will reemerge as the dominant global hub and dozens of DeFi protocols activating fee switches. There may be significant growth in stablecoins. There will be advancements in infrastructure, particularly TEEs and L2s, and Base will maintain its status as the leading rollup. The intersection of AI and crypto will become the dominant narrative.

The crypto industry is moving from basic, siloed transaction privacy to programmable privacy with zero-knowledge proofs and shared private state across blockchains. Innovations are prevalent across Multi-Party Computation (MPC) for collaborative computation without data exposure, Fully Homomorphic Encryption (FHE) for computing on encrypted data, and Trusted Execution Environments (TEEs) for hardware-based isolation. These privacy-enhancing technologies are enabling new use cases like dark pools, private AI training, and monetizable computation, though there are challenges around scalability and security assumptions.

Curve Finance's 2024 was transformative, featuring innovations like LlamaLend, scrvUSD, and NG pools, alongside major collaborations with Binance, Coinbase, and BlackRock. These milestones solidified its position as a DeFi leader, driving CRV token value up fivefold and setting the stage for continued growth in 2025.

The tokenization of agents shifts the interaction paradigm beyond simple bots to autonomous entities that can generate revenue and coordinate resources through native tokens. Pioneered by Truth Terminal's $GOAT, these agents are developing sustainable business models, like Clanker's $12.5M in LP fees and emerging agent-to-agent collaborations. The integration of tokens allows for capital bootstrapping, incentive alignment, and native units of account, insinuating a future where agents could form the operation core of the next generation of DAOs. Botto, one such project, has generated 1,354 ETH in revenue through its community-guided AI art creation system.

2024 was a transformative year for Taiko, marked by the launch of its "based rollup" on Ethereum mainnet, explosive ecosystem growth, and key technical advancements like ZK-proof integration and EIP-1559 optimization.

HOME is redefining the Memecoin landscape by addressing its challenges - short lifespans, speculative focus, and lack of utility - through innovative governance, value-oriented community building, and practical applications powered by AI and cross-chain capabilities.

2024 saw Polymarket reach all-time highs in activity.

It is possible to run a business using Bitcoin infrastructure like River for commercial activities, Satoshi Pacioli for accounting, and Zaprite for invoicing.

Switzerland has launched a proposal to amend its constitution to require the Swiss National Bank to hold Bitcoin as part of its monetary reserves alongside gold.