The Daily: Justin Drake proposes Ethereum consensus layer redesign, German government misses out on $1.6B by selling bitcoin early and more

Happy Tuesday! In today's newsletter, Justin Drake proposes an Ethereum consensus layer redesign, the German government missed out on $1.6 billion by selling bitcoin early, Ethereum Layer 2 Lisk launches its mainnet and announces plans for an airdrop, plus more.

Meanwhile, U.S. spot Ethereum ETFs posted record daily net inflows of $295.5 million on Monday, and Trumponomics could pave the way to a $1 million bitcoin price, according to Arthur Hayes.

Plus, Canary Capital files for the first-of-its-kind Hedera HBAR spot ETF with the SEC.

Let's get started.

Justin Drake proposes Ethereum consensus layer redesign

Ethereum Foundation researcher Justin Drake announced a new consensus layer upgrade proposal at Devcon on Tuesday called "Beam Chain," incorporating the latest ideas from the research roadmap.

• Beam Chain would aim for faster block times, smaller validator stakes (reduced from 32 ETH to 1 ETH), staking caps and, ultimately, making Ethereum post-quantum secure, Drake said.
• The proposed upgrade would also make heavy use of SNARKs as a technology — a type of cryptographic proof that allows one party to prove to another that they know certain information or a computation is correct without revealing the underlying data.
• Drake suggested the proposal would address some of the mistakes made in Ethereum's current Beacon Chain consensus layer design but emphasized that any such deployment would require community consensus.
• If implemented, Beam Chain would be the biggest Ethereum protocol upgrade since The Merge, when it transitioned from proof-of-work to proof-of-stake, with Drake framing the potential upgrade as Ethereum entering the ZK era of consensus.
• The Merge was initially referred to as part of "Ethereum 2.0," but the community shifted away from this term to avoid confusion and potential "ETH2" token scams. For similar reasons, Drake wants to avoid the moniker "Ethereum 3.0" for his Beam Chain proposal.
• The specification phase could start next year, with building potentially beginning in 2026, followed by a rigorous two-year testing phase starting in 2027 to ensure the upgrade is safe for mainnet deployment.

German government missed out on $1.6 billion by selling bitcoin early

The German government missed out on up to $1.6 billion by selling 50,000 BTC at $57,600 each just four months ago — right before a major rally in the asset's price spurred on by pro-crypto Donald Trump's victory in the U.S. presidential election.

• Bitcoin's surge to a new all-time high, including a record near $10,000 single-day rise on Monday, would have increased the German-held bitcoin’s value by 56%, from $2.9 billion to $4.5 billion.
• However, this pales in comparison to the U.S. government, which missed a much larger opportunity by selling 195,091 BTC for a total of $366.5 million via 11 auctions over the last decade — a stash now valued near $17 billion, implying an opportunity cost of $16.6 billion.
• During the campaign, President-elect Trump and Senator Cynthia Lummis said they would stop the U.S. from selling more seized bitcoin funds, proposing a "strategic bitcoin reserve" and suggesting a further 1 million BTC purchase to "bolster the U.S. dollar."

Ethereum Layer 2 Lisk launches mainnet and announces airdrop plans

Lisk has launched its Ethereum Layer 2 on mainnet, leveraging Optimism's OP Stack as part of the Superchain ecosystem.

• The project also plans a significant airdrop campaign beginning Nov. 21, distributing an initial 10 million LSK tokens over the first four months.
• Users can earn points by completing tasks on the Lisk platform, with their total points determining the amount of LSK tokens they receive in the airdrop.
• Lisk transitioned from a Layer 1 blockchain to a Layer 2 on Ethereum in December 2023, with a testnet launch following in February, aiming to focus on real-world assets and decentralized physical infrastructure networks.
• With its integration into Ethereum, LSK holders can now leverage ecosystem effects across DeFi, providing liquidity on platforms like Uniswap, Velodrome and Ionic Protocol, Lisk COO Dominic Schwenter told The Block.

Coinbase launches COIN50 index, tradable as a perpetual future with up to 20x leverage

Coinbase has launched the COIN50 index, a benchmark representing the top 50 digital assets on the crypto exchange, weighted by market capitalization and capped at around 50% for the largest asset.

• BTC makes up 50.3%, ETH accounts for 27.5%, SOL represents 6.4%, XRP holds 3.1% and DOGE comprises 1.5%. The remaining 45 assets in the index collectively total 11.2%.
• Eligible users can also trade COIN50 as a perpetual futures contract with up to 20x leverage — offering amplified exposure to the index's performance without expiration.
• COIN50-PERP is available to institutional and advanced retail users in eligible jurisdictions outside the U.S., UK and Canada, with Coinbase exploring further exposure options for the index.
• Earlier this year, The Block and Wintermute backed GMCI, a new company offering index products. The GMCI 30 index, which tracks the top 30 crypto assets, is up about 32% over the past week.

Dogecoin's market cap briefly surpasses $63 billion after 51% price surge

Dogecoin's price surged 51% in 24 hours to trade for $0.43 early Tuesday before correcting, briefly pushing its market cap above $63 billion, driven partly by Elon Musk's support for the memecoin and his involvement in the upcoming pro-crypto Donald Trump administration.

• "Speculators believe Musk's involvement in the new White House administration may boost the price of DOGE in the future, as the digital asset underperformed during the last bull cycle compared to other cryptocurrencies," LVRG Research Director Nick Ruck said.
• "A recent mention of a potential 'Department of Government Efficiency (DOGE)' under a Trump administration has further fueled Dogecoin's rise,” Presto analyst Min Jung noted.
• Just a month ago, Dogecoin had a market cap of around $16 billion. Its current price is at the highest level since 2021, with DOGE now the sixth-largest cryptocurrency by the metric.

In the next 24 hours

• The latest U.S. CPI inflation figures are released at 7 a.m. ET on Wednesday. Est. MoM 0.2%; Core 0.3%. Est. YoY 2.6%; Core 3.3%.
• U.S. FOMC members Neel Kaskari and John Williams will speak at 8:30 a.m. and 9:30 a.m., respectively.
• Devcon continues in Bangkok, Thailand.

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