As tokenization of traditional financial assets gains regulatory attention, a fundamental question demands rigorous analysis: Can blockchain technology provide secure settlement? In a new paper with @camharvey (@DukeU) and Kose John (@NYUStern), we develop an economic model to address this question. Our analysis yields two main insights. First: blockchain security is tied to blockchain productivity. A blockchain generating more economic value for users can share that value with validators through higher staking rewards. In turn, higher rewards attract more staked capital, raising the cost for any adversary seeking to disrupt settlement. Second: under reasonable conditions, a PoS blockchain can be secured against arbitrarily large attack incentives. This may seem surprising, but it follows from a familiar financial phenomenon that prior blockchain literature has overlooked: price impact. To disrupt settlement, an attacker must acquire a large fraction of the blockchain's native asset. However, staked assets are subject to withdrawal delays and cannot be traded immediately, so a higher staking ratio translates directly into a smaller circulating float of the blockchain's native asset. In particular, the attacker must acquire what they need from unstaked assets, and buying a large share of a small supply drives up the price. This is where the economics become powerful. Higher staking rewards attract more capital into staking, which shrinks circulating supply, amplifying the price impact an attacker would face. Because staking responds to incentives, the staking ratio can be engineered to achieve a desired level of security. Our model shows that, by setting staking rewards appropriately, price impact can be made arbitrarily large, rendering attacks unprofitable regardless of potential gains. A concrete illustration: Ethereum currently has roughly 30% of ether staked. A majority attack would require purchasing another 30% from the 70% in circulation. Our model shows this generates a price impact of approximately 75%, a cost prior literature has failed to incorporate. Importantly, 75% reflects current staking levels. By increasing staking incentives to raise the staking ratio, price impact can be made larger. This is precisely how a blockchain can be secured against arbitrarily large attack incentives. 📄 Paper: papers.ssrn.com/sol3/papers.…

An article being published does not imply that it's correct. It implies that it satisfied an editor and that's a subjective standard not an objective standard. Given that LLMs can offer informed opinions on research (probably more informed than an editor outside of a research area), the entire concept of an academic journal is now antiquated...

Is it any wonder that crypto has failed to achieve mainstream adoption (thus far)? Instead of coming up with an actual argument for tokenization, we get nonsense like this...

Also, economists are spending way too much time thinking about how AI is going to change submitting papers, and not enough about how AI is going to change the world. No more meta takes! Not one more!

🚨UPDATE: Seven more companies have objected to having their shares tokenized on OKXICE’s planned venue, bringing the total to 33. JPMorgan, AMD, Applied Materials, Coca-Cola, Adobe, Dell and Sandisk were added in an updated notice Tuesday evening. More than half of the 62 companies @okx/@ICE_Markets initially named have now objected.

OKX-ICE's first notice listed 63 stock tokens. 26 companies have now objected. unchainedcrypto.com/oracle-i…

The Bridge is one of the first conferences I've been to where the total number of institutional finance people outweighs the digital asset natives. A very telling sign on where this industry is at...

If you own a share of stock today via a broker-dealer, you're probably not on the company's books. Cede & Co., which is owned by DTC, is. Yesterday, Securitize submitted a comment letter to the SEC on DTC's proposal to modernize the Direct Registration System (DRS), the process for moving shares from Cede & Co. to the transfer agent's books and records, and we strongly support it. DTC wants to cut the time it takes to move shares via DRS into an investor's own name from days to minutes. That matters a lot for tokenization. It's the on-ramp to issuer-sponsored tokens, where the investor is the registered owner of the real security, on-chain. Not an IOU. In our letter, we asked DTC to take it one step further: let investors move from a DTC token into a directly registered token in a single step. We also asked for published processing times and the same speed in both directions. Do that, and moving between street name and a directly registered token becomes even faster and simpler, in both directions. Tokenization works best when investors can do so without friction. Great work by @SecuritizeBilly and our team. Letter below sec.gov/comments/SR-DTC-2026…

This isn't surprising. The incentive for issuers to consent to tokenization of their stock under the SEC's Innovation Exemption are weak –– they may get 24/7 trading, but that trading occurs on US venues rather than in new global markets, so there's no net new demand. But issuer objections aren't going to stop this train. There are many legal pathways to bring securities onchain that don't require consent and that aren't subject to the SEC's jurisdiction. Someone could even build a permissionless protocol that does so. So, if the SEC wants to maintain oversight of US securities markets, it needs to create an approach for tokenization that delivers the full benefits of onchain markets –– atomic settlement, 24/7 trading, global liquidity, etc. Supporting permissionless trading of securities through DeFi systems would accomplish that goal, and doing so would create the incentives for issuers that the innovation exemption lacks. nitter.siddz.com/EleanorTerrett/status/…

People in crypto need to get out of the echo chamber and make an actual argument for how issuers can benefit from tokenization. It's not obvious whether tokenization is worthwhile for issuers: papers.ssrn.com/sol3/papers.… Moreover, whether it is worthwhile depends on the regulatory environment and US regulators are pleading with industry to provide constructive feedback...

🚨UPDATE: Four more issuers have objected to @okx/@ICE_Markets tokenizing their shares under the SEC’s innovation exemption: IBM, Oracle, Intel and IonQ. That brings the total to 26.

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Just watched the @netflix Instadocs about the @OpenAI cyberattack on @huggingface. Super disappointing, as they went for maximum anthropomorphism of the technology and full doomer mode. I spent more than two hours with them trying to correct all their mistakes and ground this in reality, explaining that agents are technological systems, not aliens. But it looks like the drive to scare people for maximum views was too strong. Also, they didn’t mention the lack of containment and monitoring of the agents, how closed-model safeguards blocked our defensive work, or how we defended ourselves with AI using an open model. And that we still lack a lot of information and transparency, including full agent traces and that companies need to remain accountable for what their agents do. It ends up being a fun sci-fi movie though!

If Reg Crypto is to promote capital formation, it will need its instruments to have access to a secondary market... cc @ethlabs_org @_julianma @casparschwa @joshrudolf

One of the mandates of the SEC is to promote capital formation. Of course, whether the primary market is able to succeed in capital formation depends on whether there is a healthy secondary market. In turn, a policy that aims to support primary market issuance should not ignore the secondary market. cc: @ethlabs_org @_julianma @casparschwa @joshrudolf

.@USComptroller Jonathan V. Gould: Today’s final rule advances @POTUS Trump’s and @SecScottBessent’s vision for American leadership in digital assets. We are providing a clear, practical framework for payment stablecoin innovation, with strong standards for reserve backing, redemption, and risk management. The OCC is drawing on its longstanding supervisory expertise to support responsible growth and innovation for this new industry. occ.gov/news-issuances/news-…

🚨NEW: OCC Finalizes GENIUS Act Rules, Backs Off Stablecoin Rewards Restrictions The @USOCC has finalized its GENIUS Act rules, dropping proposed restrictions on stablecoin rewards and leaving a major fight between banks and crypto firms unresolved. cryptoinamerica.com/p/occ-fi…

🚨NEW: The comment period for the @SECGov’s Reg Crypto proposal closes today, but an SEC spokesperson tells me the Commission will continue accepting comments after the deadline. “While we encourage commenters to submit their feedback by the deadline, the Commission will continue to accept public comments on rule proposals after the comment period closes.” The proposal would create new fundraising exemptions for crypto issuers raising capital in the U.S.

Congrats to Notre Dame for continuing its streak of losing every single time they play an actual football team.

I am leaving Cambridge after a few days spent for a workshop on fast finality, concurrent with other workshops on post-quantum crypto and formal verification. Quick takeaways - Faster finality is coming, the research is mature, even as new ideas have come in during the week, the handoff to specifiers and implementers feels well underway. Next catalyst event will be at devcon in a few weeks, with core devs - The performance numbers for post-quantum finality are improving massively, and this is the worst that they’ll ever be. This is significant, it means the penalty from moving to more complex crypto would not require, in my opinion, if the numbers hold up, a deep rearchitecting to move to PQ-secure consensus, in particular when it comes to incentives - The biggest opportunity imo remains networking. Simulations and live experiments are exploring both the current pre-PQ setting, where networking is clearly the bottleneck, and the post-PQ setting, where compute remains the bottleneck. But with PQ compute numbers improving, I wouldn’t be surprised if once again networking becomes the bottleneck All of this is making me extremely bullish that we’ll achieve PQ-secure and faster finality even faster. Many thanks to @yannvon @benjaminion_xyz and @robsaltini for the workshop, and to @corcoranwill and @drakefjustin for hosting us in Cambridge!

New Launch harrycrane.com/2026-midterms 2026 Midterm Analysis is now live - Updated market consensus - Live forecast comparisons - Forecaster and polling biases - Market inefficiency metrics