MegaETH to Fund MEGA Buybacks with USDM Revenue

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Quantum FUD got a reality check from CoinShares: the scary part is smaller, and the timeline is long. No need to speedrun a civil war over burning coins.

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In Today's Email:

• What Matters: MegaETH to Fund MEGA Buybacks with USDM Revenue 💵 

• Product of the Week: Crypto.com’s AI.com 🤖 

• Charts: BTC & Quantum Risk, Bitcoin Mining Difficulty Drops 11% 📊 

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WHAT MATTERS

MegaETH to Fund MEGA Buybacks with USDM Revenue

State of play: MegaETH Foundation says it will use revenue from its native stablecoin, USDM, to routinely buy MEGA tokens from the market.

• USDM generates yield via reserves held in USDtb, an Ethena stablecoin backed by BlackRock’s BUIDL fund.

• The pitch is a flywheel: more apps use USDM, USDM grows, yield grows, and buybacks scale.

• MegaETH also set three KPI triggers that can each independently start the MEGA token generation event.

• MEGA TGE triggers 7 days after any KPI hits: $500M 30 day USDM supply, 10 apps launched, or 3 apps doing $50k fees daily for 30 days.

• Dashboards go live Feb 9. Post mainnet, “proximity markets” launch: users bid for sequencer adjacent slots to cut latency and drive MEGA demand.

Why it matters: This is a cleaner value capture loop than the usual “fees maybe later” pitch. USDM yield can become a steady MEGA bid, and the KPI based TGE delays supply until there’s actual usage.

Our take: If USDM scales, MEGA gets a built in buyer and a narrative that is not purely speculation. But it also concentrates the whole token story on stablecoin adoption and whatever USDtb yield looks like over time.

For builders and investors: Focus on real onchain usage and sustainable fees.

PRODUCT OF THE WEEK

Crypto.com’s AI.com

Crypto.com CEO Kris Marszalek says he bought the AI.com domain for about $70M paid in crypto and is now using it to launch a consumer AI agent platform.

• The product pitch is “personal agents” that go beyond chat.

• AI.com says users will be able to create agents that can message people, take actions across apps, trade stocks, and help build projects.

• It also claims user data will be encrypted with individual keys, leaning into a privacy first positioning.

• AI.com debuted via a Super Bowl LX commercial on February 8, 2026, and the product launched the same day.

Other cool products:

• Cybro, a smart hub for LP.

• Rubicon, an order book protocol for Ethereum.

• Idle Finance, a DeFi yield automation protocol.

• Request Finance, a finance solution for Web3 businesses.

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CHARTS OF THE WEEK

Only 10,200 BTC Race Real Quantum Risk

State of play: CoinShares argues Bitcoin’s quantum threat is being overstated and is not an immediate crisis, more like a known engineering upgrade on a long runway.

• It narrows meaningful exposure to legacy P2PK addresses where public keys are always visible on chain.

• CoinShares says about 1.6M BTC sits in legacy P2PK outputs, but only ~10,200 BTC is large enough to matter for market impact if compromised.

• CoinShares says cracking BTC keys would need fault tolerant quantum machines far beyond today’s hardware, so the risk is likely 10+ years out.

• It also pushes back on responses like burning “vulnerable” coins, warning that would clash with BTC’s property rights norms and decentralization.

• Instead, it favors a gradual, careful transition to post quantum signatures rather than rushing new formats before they are battle tested.

Our take: This is the right framing. The near term risk is narrative and positioning, not mass coin theft.

Bitcoin Mining Difficulty Drops 11% as Miners Shut Down

State of play: Bitcoin mining difficulty fell 11.16% to 125.86T at block 935,424, the biggest negative adjustment since China’s 2021 mining ban and one of the largest ever.

• Hashrate is down about 20% over the past month as miners shut off rigs amid the BTC drop and Winter Storm Fern power curtailments.

• Mining margins are getting crushed. Hashprice fell to record lows ~$33 to $35 per PH per day, below the ~$40 breakeven, so only the newest rigs look solid.

• The difficulty cut helps remaining miners mechanically, but real relief still depends on BTC price and power costs.

Our take: The difficulty cut is mechanical relief, but it does not fix the core issue: weak price plus low fees and high power costs.

QUICK BITES

• Bitcoin mining difficulty drops 11%.

• Crypto liquid funds respond to the bitcoin crash.

• CoinShares says only 10,200 BTC face real quantum risk.

• VCs clash over non-financial use cases in Web3 and crypto.

• Crypto.com CEO Kris Marszalek bought AI.com for $70M in crypto.

• MegaETH Foundation to use USDM revenue to fund MEGA buybacks.

• CFTC expands payment stablecoin criteria to include national trust banks.

• Google search volume for 'crypto' hovers near yearly low amid market rout.

NOTEWORTHY READS & MEME

• Andrew Kang’s read on The Exponential Horizon.

• Eli’s read on Why On-Chain Tokenization is Broken.

• Stani’s read on Disrupting the Cost Structure of Lending.

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Disclaimer: All the information presented in this publication and its affiliates is strictly for educational purposes only. It should not be construed or taken as financial, legal, investment, or any other form of advice.