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In this week's edition, Alex Thorn checks in on the CLARITY Act’s prospects; Will Owens considers the implications for cryptocurrency of President Trump’s executive order on quantum computing; and Thad Pinakiewicz looks at how ENS and Gnosis Safe are restructuring governance.
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Market Update
The total crypto market cap stands at $2.14tn, down 4.57% from last week (when it stood at $2.24tn). Bitcoin's network value is 4.29% of gold's market cap. Over the last seven days, BTC is down 4.47%, ETH is down 7.59%, and SOL is up 1.56%. Bitcoin dominance is 56.12%, down 9 basis points from last week.
Q-Day Urgency Increases as Trump EO Accelerates Timeline
On June 22, President Trump signed two executive orders that treat quantum computing the way Washington now treats semiconductors and AI: a strategic asset worth racing for. One order is about building the machine and the other is about surviving it.
The first, “Ushering in the Next Frontier of Quantum Innovation,” is the more ambitious one. This is a whole-of-government push to ship a quantum computer powerful enough to do real science. The second, “Securing the Nation Against Advanced Cryptographic Attacks,” is the one crypto enjoyooors should prioritize reading. It’s a countdown clock for the day a quantum computer will be able to break the encryption that secures the modern internet – and (though the order never says the word) the encryption that secures Bitcoin.
The build order established the QC-ADDS Effort (Quantum Computer for Application Development and Discovery Science) with the goal of delivering to a Department of Energy lab at least one machine capable of scientific discovery beyond the reach of modern classical computers. The DOE has 90 days to publish the technical specs and 180 days to explore private-sector partnership models. The Department of War (formerly Defense) has 60 days to pick three next-generation quantum sensor projects and a September 2028 target to field them. Stack on five-year plans from Commerce, Energy, the National Science Foundation, and NASA, a domestic supply-chain mandate, a national workforce training network, an expanded counterintelligence team, and coordination with foreign allies through a framework called Pax Silica. This is industrial policy, quantum edition.
The defense order is narrower and sharper. It targets the existential problem: a cryptographically relevant quantum computer running Shor’s algorithm could break the public-key cryptography that underpins most digital security. The near-term risk isn’t a machine that exists today. It’s “harvest now, decrypt later,” where adversaries vacuum up encrypted data now to crack once the hardware arrives. So, the order sets dates. Federal high-value systems must move to the National Institute of Standards and Technology’s post-quantum standards for key establishment by Dec. 31, 2030, and for digital signatures and authentication a year after that. NIST must run a pilot on its own systems by 2027. Contractors get dragged along through updated federal acquisition rules.
None of this came out of nowhere. In 2018, during his first term, Trump signed the National Quantum Intitiative Act. And a month before the EOs, on May 21, Commerce committed ~$2b in CHIPS Act money (with government equity stakes attached) to nine quantum companies, including $1b to a new IBM foundry subsidiary (“Anderon”) and $375m to GlobalFoundries. The market got the message: quantum stocks jumped on the news with Infleqtion up ~13%, D-Wave ~7–8%, Rigetti ~6%, and IonQ ~3%.
Our Take
The post-quantum computing (PQC) order is the strongest external validation anyone working on the quantum threat to blockchains could have asked for. The same Shor’s algorithm the federal government just set a hard 2031 deadline to defend against is the exact attack vector that threatens Bitcoin. ECDSA and Schnorr (the signatures securing the network) break on exactly this. Project Eleven, the quantum research lab that has spent substantial time and energy making this argument, just got the most powerful co-signer imaginable. When Washington pours $2b into quantum and writes migration deadlines into law, “is the threat even real?” stops being a debate. P11 built a company on the premise that the clock is ticking. The government just published the clock.
But the validation comes with an uncomfortable mirror, and it’s the part the bullish headlines skip. The federal government can do what Bitcoin structurally cannot: order the migration. The Office of Management and Budget sets a deadline, agencies comply, the Federal Acquisition Regulations system forces contractors into line. Top-down, enforceable, done. Bitcoin has no deadline-setting authority, no one who can compel a single holder to move any coins. According to Project Eleven, roughly 7 million BTC (about a third of supply) sit in addresses with exposed public keys, the precise condition Shor’s exploits. Roughly 1.7 million of those are in ancient wallets, including the ~1m widely believed to belong to Satoshi Nakamoto, Bitcoin’s creator. Those coins will likely never migrate.
Bitcoin’s attempt at the government’s playbook as of today is BIP 361. This Bitcoin Improvement Proposal is called “Post Quantum Migration and Legacy Signature Sunset” and would set a deadline and freeze coins that don’t move in time. Note the verb, freeze. The federal version of forced migration is called compliance. Bitcoin’s version frequently gets criticized for being authoritarian and confiscatory, because freezing coins is the direct negation of “your keys, your coins.” Bitcoin has to persuade a leaderless network (some of whose largest holders are unknown) to voluntarily rewrite its own security model, and even the proposal to try splits the room.
This is why the picks-and-shovels layer is the cleaner read than the consensus fight. BIP 360 would give Bitcoin a quantum-resistant address type (P2MR), but an activation timeline is uncertain.
The longer-term read: every federal deadline and funding round pulls “Q-Day” forward in the market’s mind, and that narrative cuts both ways for Bitcoin. It’s the catalyst that finally drags the quantum debate out of the fringe. Bullish for PQC builders, vindicating for the people who saw it early. It’s also a slow-building overhang on the third of supply that no one can order to move.
The government just proved it can set a deadline. Bitcoin’s harder problem is that knowing the date was never the bottleneck. Acting on it, with no one in charge, is. - Will Owens
CLARITY Act’s Odds Slip Further
President Trump said Wednesday he won’t sign a housing bill unless Congress passes the SAVE Act, intensifying competition for scarce Senate floor time, and thereby hurting the CLARITY Act’s odds.
There is little new to report on the CLARITY Act this week, and the absence of news is itself the news. Since our June 5 note cutting our passage odds to 60%, the bill has sat on the Senate Legislative Calendar as item No. 423, where it has been since June 1 after clearing Senate Banking 15 to 9 on May 14. No floor date has been set, and no motion to proceed has been scheduled.
Reconciliation of the Banking and Agriculture committee texts continues at the staff level, and there are some indications that constructive negotiations continue. But there has been no public announcement that Banking and Agriculture have agreed on a combined bill, no release of unified legislative text, and no signal on timing for floor consideration. The substantive issues we have flagged remain roughly where they were. Ethics is still a central open question. The Van Hollen conflict-of-interest amendment failed 11 to 13 in committee, and Senators Gallego and Booker continue to insist on enforceable standards as a condition of their support. The illicit-finance hawks still want further changes on the developer-protection language.
Competition for floor time intensified this week. On June 24, the President abruptly canceled the signing of the bipartisan, bicameral housing bill, which had passed 358 to 32 in the House and 85 to 5 in the Senate, and said he would not sign it until Congress passes the SAVE Act, a proof-of-citizenship elections bill that Majority Leader Thune has said lacks the votes to pass the Senate. That condition injects another contentious, leadership-consuming fight into an already crowded queue. And two must-do items also remain unfinished: Section 702 of FISA lapsed on June 12 after the Senate and House failed to pass a reauthorization, and a bipartisan Grassley-Cotton-Warner product still needs floor time; and the FY2027 NDAA, the annual must-pass defense bill, also still has to move before the recess.
Our Take
We are lowering our estimate that the CLARITY Act becomes law in 2026 to 50-50, down from 60% on June 5. The downgrade is primarily related to the calendar, not the substance of the bill. The recess is scheduled to begin at the end of July. For a 60-vote bill that still needs a merged Banking-Agriculture text, a motion to proceed, floor debate, an amendment process, and then House action on whatever the Senate produces, the runway is quickly declining into just a matter of weeks. In our view, Senate Majority Leader Thune needs to announce floor time by early July at the latest, possibly during the July 4 recess, with the vote itself occurring before the August recess. Absent a scheduling announcement on that timeline, the path slips to September, which runs directly into the midterm dynamics we have warned about, when controversial votes become very hard to schedule.
The reason the calendar keeps eroding is competition. Every week that FISA, the NDAA, and now the SAVE Act and housing standoff claim floor time and leadership attention is a week CLARITY does not get called to the floor. The housing bill already passed both chambers with veto-proof majorities but is now a live political fight again, and the SAVE Act demand behind it is exactly the kind of unrelated, contentious priority that crowds out everything else in a compressed, pre-recess window. Floor time is the scarcest resource in the Senate right now, and crypto market structure is not first in line for it.
To be fair to the bill, the substance has not necessarily worsened and may have quietly improved. Constructive staff-level work toward a combined text is what we would want to see at this stage. But private meetings are not the same thing as a scheduled vote. With no merged text, no floor date, the ethics question still unresolved, and law enforcement still agitating on the developer protections inside the Blockchain Regulatory Certainty Act (BRCA), we cannot justify holding our estimate above even odds while the clock runs.
Things that would cause us to increase the odds of passage in 2026 include a public agreement on combined Banking-Agriculture text; credible signs the ethics issue or BRCA has been bridged in a way that delivers a durable bloc of Democratic votes (we continue to expect at least two Republican no votes in Hawley and Paul); and, above all, a floor commitment from leadership for July. A scheduling announcement in the next two weeks would likely push us back toward 60% or higher. Continued silence into mid-July would push us lower.
We still think enactment this year has a strong chance – for a bill of this magnitude and complexity, 50-50 are pretty good odds. The committee vote was real, the bill is on the calendar, and the engagement behind the scenes appears genuine. But the bill needs floor time it has not been promised, in a Senate that keeps finding other things to do, and the window to promise it is now weeks, not months. -Alex Thorn
It's DAO or Never: ENS and Gnosis Rejigger Governance Models
Within a few weeks of each other, the Ethereum Name Service (ENS) proposed to consolidate its treasury under a foundation board and Gnosis voted to let its holders cash their share out. Two of Ethereum's oldest decentralized autonomous organizations (DAOs), sitting on two of its largest treasuries, answered the same question in opposite directions: what comes next for the DAO? ENS wants to hand its treasury to a foundation board with grown-ups on it. Gnosis holders were invited to take their share of the treasury and walk. Same crisis of purpose, two paths forward.
Start with ENS. A temp check from Katherine Wu, COO of ENS Labs, proposes moving treasury operations, grants, and long-term capital strategy to an expanded five-seat ENS Foundation, with Alex Urbelis as a full-time executive director. The proposal targets many of the common weak points in DAO governance that keep a protocol from effectively executing on its mission. The proposal has five goals: address delegate fatigue; reduce immaterial governance votes; bring accountability to grant recipients; improve coordination among DAO contributors; and build a long-term capital strategy. The restructuring is not meant to be drastic in substance. Tokenholders keep the things that need to be credibly neutral, plus the right to fire directors. Custody of the assets stays in DAO contracts. The pitch is that decentralized voting is good at stewarding neutral infrastructure and bad at being a budget committee, and that ENS spends most of its time being a budget committee.
The reception has been mixed to say the least. Delegate Lefteris Karapetsas noted that there is no DAO left to speak of. Security Council member Brantly Millegan called the proposal an attempted treasury capture by Labs and started drafting a veto, which makes for a slightly awkward race given that the Council's mandate expires July 24. The raid framing is a simplification, though. The proposal is trying to fix a genuine mismatch. The DAO was built to steward infrastructure, but what it does day to day is approve invoices, and tokenholder votes are a clumsy, slow, low-turnout way to handle everyday business. Delegate fatigue is real, and five accountable people allocating roughly $15 million a year beats running every decision through round after round of proposals and votes.
Gnosis ran the other experiment. GIP-151 offers GNO holders an opt-in redemption: surrender your token for a pro-rata slice of the roughly $156 million treasury, about $110 a token against a market price near $100. This is the RFV (risk-free value) raider’s playbook: a token trading below the value of its assets should be redeemed or wound down. The same logic unwound Rook and Fei/Tribe and pushed Aragon to repurpose its treasury. The twist that should make every OG DAO sit up: the proposal was co-written with the Gnosis founding team. The people who spent the spring fighting off a hostile version of this are now holding the door open, and the vote is running near 97% in favor.
Our Take
These structures were not built in a vacuum. They were designed for the Gary Gensler-era SEC, with convoluted token-and-treasury arrangements were meant to align protocol value with holders without looking enough like a security to draw a subpoena or a Wells notice. The regime has since changed. The scaffolding the DAOs put up around themselves has not. ENS isn't badly governed, by the standards of 2021 — it has simply outgrown the structure it built in its infancy.
What both stories point at is the same structural problem DAOs inherited from the previous cycle. There is a permanent tension between operational efficiency, which is what boring, corporate, principal-agent governance does well, and the slow, deliberate inertia of token voting, which is what you want for stewarding credibly neutral code. The answer, like most things in this world, isn’t to reduce the options to a binary, but find a comfortable solution in the middle that balances incentives. It's votes for the protocol and a board for the budget: keep the part that needs to be decentralized decentralized, and stop pretending a quorum of inattentive token holders is the right way to run a nine-figure treasury.
A token trading below the value of the treasury behind it tells you something specific, and what it tells you depends on the protocol. For an early-stage project, the discount can be a venture-style markdown, the market's clock out of sync with a product that hasn't shipped yet. For a mature one sitting on a nine-figure war chest, it is the market saying the team is making negative-EV decisions and would the team kindly stop. Gnosis, trading for less than its own cash value, is answering by handing the cash back. ENS is betting it can right-size before anyone tables a redemption of its own.
A standing, opt-in redemption at net asset value (NAV) is a put option written against the treasury, and a put option is a wonderful thing to wave at a team that has grown comfortable spending other people's money. Public companies have lived under this discipline for a century: buybacks, tender offers, the activist with a slide deck. Aragon's Anthony Leutenegger has been making roughly this case, that tokenholder rights written into the contract from Day One align incentives better than any amount of forum scolding. Give holders a credible exit and you force whoever is spending the money to clear a hurdle rate or hand it to someone who will. Futarchy launchpads like MetaDAO, and other iterations on the RageQuit mechanism from MolochDAO hand token holders those rights by default on launch, aligning incentives from the start.
The more interesting question is what the surviving DAO looks like, and the answers are getting good. The boring decisions get delegated: to a board, to a committee, eventually to your custodian. One can imagine Coinbase voting your governance tokens by default, the way your broker votes your shares, with an opt-out for the handful of people who actually read proposals. That is partly centralization, yes, but it is also how you beat the voter apathy that lets a single whale capture an empty room.
These aren’t the first and they won’t be the last projects to consider restructuring. The pressure is on for other DAOs with large treasuries and legacy governance structures. DAOs built in 2021 were optimized to avoid getting sued. The ones worth building now are optimized to work. That is roughly what Vitalik Buterin, Ethereum’s creator, has been saying all along: we need more DAOs, just different and better ones. - Thad Pinakiewicz
Other News
📱 Meta said to be building a prediction market app
🕙 Binance withdraws Greece MiCA application as July EU deadline looms
🤝 NYSE parent ICE and OKX form crypto JV co-chaired by ex-Gov. Cuomo
💰 Kalshi said to seek $40b valuation in next round, almost 2x last one
✅ MoneyGram becomes a Solana validator
Charts of the Week: Why Ethereum Needs a Reset
On Tuesday, the Ethereum Foundation (EF) announced it had cut roughly 20% of its employees, 54 people, as part of a “months-long process of reorganization.” Meanwhile, Ethereum creator Vitalik Buterin said the foundation would cut its budget by 40%. The restructuring follows a period of significant leadership turnover and is part of a broader strategic reset following ETH's underperformance and the chain’s loss of market share across key metrics in recent years.
ETH has been one of the weakest performers among the top crypto assets this past cycle, with the ETH/BTC pair roughly 60% below where it sat when the Merge completed in September 2022 and back near levels last seen in 2020. At the time of writing, it sits roughly 65% below its all-time high. It has held its rank as the second-largest crypto asset without interruption since 2018, but its share of total market cap has eroded steadily.
For more on the ongoing turnaround strategy, read our recent alert.
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