The Protocol: Zora transitions to Solana

Also: EF’s Stańczak to depart ED role, XRPL member-only DEX and Ethereum revives the DAO.

What to know:

Welcome to The Protocol, CoinDesk’s weekly summary of the most significant developments in cryptocurrency technology. I’m Margaux Nijkerk, a journalist at CoinDesk.

In this edition:

• Zora transitions to Solana with ‘attention markets’ for trading internet trends
• Ethereum Foundation undergoes leadership changes: Tomasz Stańczak exits as co-executive director
• XRP Ledger introduces members-only DEX for regulated entities
• From the 2016 hack to a $150M Endowment: the DAO‘s second iteration focuses on Ethereum security

Network News

ZORA SHIFTS FROM BASE TO SOLANA: The on-chain social platform and decentralized protocol Zora is making a significant transition from its non-fungible tokens (NFT) and creator origins with the introduction of “attention markets” on Solana. This feature allows users to trade tokens associated with internet trends, memes, and cultural moments. Launched on Feb. 17, it enables anyone to create a new market for 1 SOL. Once activated, users can buy and sell positions on whether a topic will gain or lose popularity on social media. Rather than betting on elections or macroeconomic data, traders speculate on the buzz itself — including hashtags, viral stories, or overarching themes like “AI girlfriend” or “bitcoin.” The design capitalizes on Solana’s advantages, as quick block times and low transaction fees facilitate rapid price updates and frequent trading, crucial for markets centered around fleeting online trends. Initial activity was limited, however. The main “attentionmarkets” token briefly achieved around $70,000 in market capitalization, with approximately $200,000 in trading volume. Most other trend markets encountered challenges in attracting significant liquidity, with few exceeding the $10,000 mark on their first day. Percentage fluctuations were sharp, primarily driven by thin order books instead of sustained demand. Zora emerged as one of the standout applications on Coinbase’s Layer 2 Base network in recent years. It introduced its ZORA token there in April and contributed to the launch of Creator Coins linked to Base profiles in July, a move that temporarily helped Base surpass Solana in daily token creation. Creator coins represent tokens associated with an individual creator’s online identity, brand, or community. They can be viewed as tradable “shares” in a person’s online presence. On platforms like Zora and Base, a creator coin could be generated automatically from a user’s profile. Supporters might purchase the coin to demonstrate backing, gain social influence, or speculate on the creator’s rising popularity. As more individuals bought in, the price could increase, and as interest waned, it could decline. Consequently, some in the Base community perceived the new “attention markets” feature as a departure from that momentum. — Shaurya Malwa Read more.

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EF EXECUTIVE-DIRECTOR TO DEPART: Tomasz Stańczak, co-executive director of the Ethereum Foundation (EF), has announced his intention to resign from his leadership position at the end of February 2026, marking a significant transition in the organization’s executive team. Stańczak, who has co-led the foundation alongside Hsiao-Wei Wang since early 2025, mentioned in a blog post that he believes the foundation and the wider Ethereum ecosystem are “in a healthy state” as he prepares to transfer responsibilities to Bastian Aue, who will assume the co-executive director role alongside Wang. Stańczak’s tenure began during a challenging period for the EF. He was appointed following the transition of long-serving executive director Aya Miyaguchi into a new leadership role amid increasing community criticism that the foundation was not doing enough to actively advance the Ethereum ecosystem. At that time, critics highlighted a perceived disconnect between the EF and developers, including conflicts of interest, disagreements over strategic direction, and dissatisfaction regarding ETH‘s price performance. Such criticisms prompted a broader leadership restructuring. While Stańczak expressed his confidence in the team’s ability to continue the EF’s mission, he also indicated his desire to remain engaged in the ecosystem. — Margaux Nijkerk Read more.

XRP LEDGER LAUNCHES MEMBER-ONLY DEX: The XRP Ledger has implemented a new “Permissioned DEX” amendment, a technical upgrade that enables regulated institutions to trade on XRPL without opening markets to all participants. Known as XLS-81, this change permits the establishment of permissioned decentralized exchanges that function similarly to XRPL’s existing built-in DEX, but with a crucial distinction. A permissioned domain can limit who can place offers and who can accept them, creating a restricted trading environment where participation is contingent upon compliance requirements like KYC and AML checks. This can be regarded as a ‘members-only’ marketplace, while still preserving the trading mechanics intrinsic to the ledger. The feature is intended for banks, brokers, and other entities that may seek on-chain settlement and liquidity but cannot engage with fully open DeFi markets. For these participants, the capability to control access is essential. The activation also adds to a growing collection of “institutional DeFi” tools that XRPL has been introducing this month. Token Escrow, or XLS-85, went live last week, expanding XRPL’s native escrow system beyond XRP to encompass all trustline-based tokens and Multi-Purpose Tokens, including stablecoins such as RLUSD and tokenized real-world assets. — Shaurya Malwa Read more.

ETHEREUM MEMBERS INTRODUCE NEW VERSION OF THE DAO: In the summer of 2016, the Decentralized Autonomous Organization, referred to as the DAO, epitomized a significant crisis in Ethereum’s early history. A smart contract exploit drained millions of dollars’ worth of ether (ETH) from that initial project, and the community’s response — a contentious hard fork to recover those funds — severed the original chain from the current one, leaving the old chain known as Ethereum Classic. The DAO was once the largest crowdfunding initiative in crypto’s history but later became a cautionary tale regarding governance, security, and the constraints of “code is law.” Now, nearly a decade later, that narrative has taken an unexpected turn. What was lost, or rather, left untouched, is being repurposed as a ~$150 million (at current prices) security endowment for the Ethereum ecosystem. This endowment, now called TheDAO Security Fund, will stake some of the 75,000 dormant ether (ETH) and allocate the yield through community-driven funding rounds to bolster Ethereum security research, tools, and rapid-response efforts, while maintaining claims open for any remaining eligible token holders. Central to this story is Griff Green, one of the original DAO curators and an expert in Ethereum decentralized governance. “When the DAO hack occurred [in 2016], I quickly took action and essentially led everything but the hard fork,” Green stated regarding his role in assembling the white hat group that salvaged funds on the original Ethereum chain. “We countered all these hackers. It was straight up DAO wars.” That initiative, alongside others, helped recover funds that might have otherwise been lost forever. At the time, the hard fork restored approximately 97% of the DAO’s funds to token holders, but left a small portion, around 3%, in limbo. These “edge case” funds arose from peculiarities of the original smart contracts: individuals who overpaid, those who burned tokens to create sub-DAOs, and other anomalies that didn’t easily map back. Over time, that leftover balance, once valued at a few million, increased significantly due to ether’s appreciation. “The value of the funds we manage has grown exponentially… well over 75,000 ETH,” a blog post for the new DAO fund declares. — Margaux Nijkerk Read more.

In Other News

• A recent survey of 1,000 American investors in digital assets revealed that more than half are concerned about facing an IRS tax penalty this year as new transparency regulations governing crypto exchanges come into effect. The data gathered at the end of January by crypto tax platform Awaken Tax explored U.S. holders’ apprehensions about a significant change from self-disclosure to automatic transaction reporting. This has been enacted through the introduction of the “Digital Asset Proceeds From Broker Transactions,” or Form 1099-DA, which tens of millions of Americans will become aware of in the upcoming month. The new regulations aim to combat crypto tax evasion and require brokers, such as crypto exchange Coinbase (COIN), to report all sales and exchanges of digital assets that occurred in 2025 to the tax agency. The objective is to provide tax authorities with a clear view of investor gains and losses by opening up customer data within exchanges for the first time, allowing the IRS to compare what crypto brokers report with what taxpayers file. While the intention is to eliminate any margin of error, the regulations are a “blunt instrument,” created by legislators who lack knowledge about crypto, according to Awaken Tax founder Andrew Duca. “It means crypto is being treated like stocks, but it doesn’t function that way. Real crypto users will transfer assets between multiple wallets and engage with decentralized finance (DeFi) protocols, utilizing quite complex trading strategies,” Duca stated. — Ian Allison Read more.
• Crypto venture capital firm Dragonfly Capital has finalized a $650 million fourth fund, marking one of the largest capital raises in the industry during a period when many blockchain-focused VCs are facing challenges, according to Managing Partner Haseeb Qureshi. “It’s an unusual time to celebrate,” Qureshi noted in a social media post, describing low spirits and “the gloom of a bear market” for crypto. However, he emphasized that Dragonfly has historically raised funds during downturns, including the 2018 ICO crash and just before the 2022 Terra collapse, ‘vintages,’ he said, that ultimately turned out to be the firm’s best performers. In September, the firm announced its goal to raise $500 million for its fourth fund, targeting early-stage projects. It has yet to identify any of them. In May 2023, Dragonfly Capital raised $650 million for its third crypto fund aimed at later-stage companies. — Olivier Acuna Read more.

Regulatory and Policy

• Hyperliquid (HYPE), a blockchain-based exchange that processed over $250 billion in perpetual futures trading last month, has established a U.S. lobbying and research division to influence how lawmakers regulate decentralized finance (DeFi). The Hyperliquid Policy Center, a nonprofit located in Washington, D.C., will concentrate on regulatory frameworks for decentralized exchanges, perpetual futures, and blockchain-based market infrastructure, as stated in a press release. Jake Chervinsky, a well-known crypto attorney and former policy head at the Blockchain Association, will serve as founder and CEO. The launch coincides with congressional and federal agency discussions on how to oversee crypto trading platforms and derivatives markets. Perpetual futures, which enable traders to maintain leveraged positions without an expiration date, are widely utilized on offshore platforms but remain ambiguous under U.S. law. The emergence of this new organization also represents the latest addition to a Washington crypto-policy landscape that is crowded with similar entities, including the DeFi Education Fund and Solana Policy Institute, as well as broader groups such as the Digital Chamber, Blockchain Association, and Crypto Council for Innovation. Furthermore, the new organization arises as negotiations are ongoing regarding Senate legislation that may establish U.S. DeFi policy. — Kristzian Sandor Read more.
• The legal challenges from state governments against certain aspects of prediction markets like Polymarket and Kalshi received a strong rebuke from U.S. Commodity Futures Trading Commission Chairman Mike Selig, who contends that his federal agency holds jurisdiction, not the states. “To those who seek to challenge our authority in this area, let me be clear: we will see you in court,” Selig stated in a video message shared on social media platform X. He mentioned that his agency submitted a legal brief in court to support the federal role as the primary regulator over this segment of the derivatives markets. “The CFTC has overseen these markets for over two decades,” he remarked. “They provide valuable functions for society by allowing everyday Americans to hedge commercial risks such as temperature increases and energy price fluctuations; they also serve as an important check on our news media and information sources.” — Jesse Hamilton Read more.>