The Frontier

The Senate confirmed Bitcoin-friendly Kevin Warsh to the Federal Reserve Board in a 51-45 vote, with Senator John Fetterman joining Republicans, clearing his path to potentially replace Chair Jerome Powell.

Kevin Warsh has described Bitcoin as an important asset and a monetary policy signal, holds an equity stake in Lightning payment startup FlashNet, and maintains advisory ties to Bitwise and stablecoin project Basis.

Square has automatically enabled Bitcoin payments via Lightning for roughly 1 million eligible U.S. merchants, with merchants receiving dollar settlements by default to remove currency risk.

Charles Schwab launched spot Bitcoin trading for retail clients with a 75 basis point fee, integrating it directly into brokerage accounts that hold over $11 trillion in client assets.

Franklin Templeton and Kraken parent Payward partnered to tokenize traditional financial products like money market funds, aiming to make them usable as on-chain collateral or cash management tools.

The Producer Price Index (PPI) printed at 1.7%, nearly three times higher than the 0.5% economists expected, signaling coming consumer inflation and pressuring Bitcoin's price lower.

David Bennett argues Bitcoin price action now correlates more strongly with traditional economic news like CPI and PPI due to increased ownership by mainstream finance, a shift from its first decade.

Kyle Olney argues the Blockchain Regulatory Certainty Act (BRCA), Section 604, is the existential provision of crypto market structure legislation, as it protects non-custodial software developers from being prosecuted as money transmitters.

Olney warns that without BRCA protections, developers like those behind Tornado Cash and Samourai Wallet face criminal prosecution for publishing code, which would drive innovation offshore to jurisdictions like Singapore or the UAE.

CFTC Chairman Mike Selig filed amicus briefs backing prediction market Kalshi against Ohio and other states, asserting the CFTC's exclusive jurisdiction over event contracts traded on designated contract markets.

The CFTC has sued five states - Wisconsin, New York, Arizona, Connecticut, and Illinois - for interfering with CFTC-regulated prediction markets like Kalshi, Polymarket, and Coinbase.

Brown notes Japanese and South Korean combined investment in the US totals $900 billion, and they would be most threatened by any US-China deal allowing Chinese EVs into the American low-end market.

Harry Sudock says Bitcoin mining and AI differ in their energy stories: AI addresses insufficient power generation, while Bitcoin mining tackles inefficient power consumption. Both increase electron utilization but have distinct operational profiles.

Rory Murray argues AI's rise will decentralize Bitcoin's hash rate. Large energy-backed compute will prioritize AI for higher enterprise value, pushing Bitcoin mining to geographic and jurisdictional frontiers, creating a hub-and-spoke model.

CleanSpark's Bitcoin treasury management operates a dual strategy. Its 'spot plus' program enhances returns from monthly spot sales, while its 'yield program' aims to generate durable yield from its hodl by leveraging derivatives market volatility.

CleanSpark generates 500-600 Bitcoin monthly from mining. A portion is sold for OPEX and CAPEX, while the team deploys strategies like selling short-dated covered calls to extract additional margin from the Bitcoin before conversion.

Rory Murray says their covered call strategy is self-reinforcing because they have an operating business that prints Bitcoin. If calls are exercised during a parabolic move, they can pause spot sales for months, replacing the called-away Bitcoin with future production.

Rory Murray states Bitcoin's liquidity and 24/7 trading make it superior collateral for loans. He says institutional Bitcoin-backed loan rates have compressed from 9-11% to around 6%, citing CleanSpark's recent paper at 'software plus 3.55%.'

The pair believe Bitcoin should trade at a lower loan rate than corporate credit due to its over-collateralization, automatic liquidation, and 24/7 global liquidity, which creates a near-seamless, lossless collateral liquidation mechanism.

Rory Murray outlines a treasury flywheel: use appreciating Bitcoin to borrow depreciating dollars, deploy dollars into appreciating assets like AI data centers, and use the revenue to fuel further growth and Bitcoin acquisition.

Gustavo notes Bitcoin Core PR #33796 adds BTCK_check_transaction endpoint. It runs context-free consensus checks on transaction structure.

Gustavo explains PSBT v2 (BIP370) is now default in Bitcoin Core. It allows modular transaction construction, supporting adding inputs/outputs mid-process.

BIP451 defines a DUST UTXO disposal protocol. It uses SIGHASH_ALL|ANYONECANPAY, letting anyone batch dust inputs into a single zero-value OP_RETURN output.

Murch notes the protocol's OP_RETURN includes 'ASH'. A legacy input creates a ~65 byte transaction, while a SegWit input creates a transaction of exactly that size.

Eclair PR #3144 updates simple taproot channels to use the official feature bit, aligning with LND's production implementation from Newsletter #401.

Eclair PR #2887 adopts the official splicing protocol from Bolt specs. It maintains backward compatibility but upgrades wire messages, keysend, and RBF handling.

LDK now checks for sufficient reserves before opening zero-fee commitment channels. It counts them as anchored channels to guard against simultaneous force-closes.

LND adds a 'source_pub_key' field to route construction. This allows calculating routes from another node's perspective, not just your own.

RustBitcoin adds a V1_message_header constructor. It lets developers build P2P message headers without requiring network transmission.

Zach Herbert advocates for Bitcoin as the ultimate winner in a global currency war where central banks are devaluing fiat currencies.

Herbert argues the common Bitcoin-AI intersection narrative - Lightning for machine-to-machine payments - is a 15-year-old concept from projects like 21.co's Balaji machine-payable web.

Herbert says Foundation's core mission is applying Bitcoin principles of explicit human approval and trusted hardware to secure AI, not just enable AI payments.

Foundation's Passport Prime runs on a custom microkernel operating system called KOS, with a kernel under 9,000 lines of code written in Rust, designed for minimal attack surface and app sandboxing.

Herbert criticizes Ledger for dominating 90% of the hardware wallet market with a legacy platform built on 30-year-old smart card/Java Card technology, forcing a closed, app-reviewed ecosystem.

KOS sandboxes third-party apps via a message-passing microkernel, memory isolation using an MMU, and grants apps only hardened derived child keys - never the master seed.

Herbert says Foundation will release an SDK and a developer mode for Passport Prime with an MCP server, allowing AI models to autonomously test apps on the real hardware.

Marty Bent observes that Bitcoiners have a unique, low-time-preference perspective on security and institutional trust, which is essential for guiding the AI industry away from its current growth-over-security trajectory.

Sun warns AI super PAC endorsements can become a political liability due to populist sentiment, unlike crypto's Fairshake PAC.

Caldwell suggests applying the regulatory and incentive toolkit used for the oil and gas industry over the last 50 years to a new minerals mandate, to mobilize private capital with long-term market confidence.

Sidiqui notes green capital markets doubled in two years, but over a third of that growth is from China, not free-market capitalism.

The current AI-driven capex boom is the largest in their careers, surpassing the late 1990s. Dutta warns its eventual slowdown will be a major macro issue, threatening equity appreciation and consumer spending.

Koch Industries reinvests 90% of its profits into new businesses and growth, fostering a culture of experimental discovery and creative destruction.

Odell notes the current Bitcoin price is $80,000, with a block height of 949106 and 1249 sats per dollar on May 12, 2026.

Odell states Citadel Dispatch is viewer-supported through Bitcoin donations, operating without ads or sponsors. Last week's largest Zaps included 21,000 sats from Prodigious and 12,221 sats from Florida Justin.

Odell highlights Bitcoin's pivotal role for WikiLeaks in 2011 after Visa, Mastercard, and PayPal debanked it. This event served as early proof of Bitcoin's function as 'freedom money.'

Odell notes that Satoshi Nakamoto initially expressed concern about WikiLeaks using Bitcoin, fearing negative attention. However, Bitcoin proved resilient, fulfilling its mission as freedom money and becoming WikiLeaks' first significant endowment.

Jack Dorsey suggested a community-funded distribution model, rather than directly paying for release, to empower Bitcoiners as an 'army of support.' This approach aims to bypass centralized gatekeepers in the movie industry.

Odell and Eugene Jarecki are experimenting with a new distribution model where Bitcoiners become 'Bitcoin producers' by donating 0.01 Bitcoin. This sum aligns the film's financial success with Bitcoin's value and allows for a self-release.

Bitcoin producers receive an official film credit, two hours of exclusive sensitive video material (e.g., Edward Snowden, Daniel Ellsberg's final interview), and a document archive. This includes evidence of illegal spying and torture against Julian Assange.

Odell acknowledges Nostr's success in social funding through zaps, driven by the belief in free information. However, he notes the film's substantial financial requirements exceed typical micro-donations.

Eugene Jarecki and Odell are hosting a private watch party for Bitcoin producers of 'The 6,000,000,000 Dollar Man' on June 27 at 4 PM Eastern Time. More information is available at thesixbilliondollarman.com.

Odell notes that a Bitcoiner anonymously donated $500,000 in Bitcoin to fund Julian Assange's private plane from London to Australia after his release, demonstrating Bitcoin's unique utility for high-value, permissionless donations.

Eugene Jarecki believes this community-funded film model could revolutionize distribution for future independent filmmakers, comparing its potential impact to Napster's disruption of the music industry.

A PreStokes dashboard showed Anthropic with an implied valuation above $1.5 trillion, despite the platform holding only roughly $23 million in total assets.

The draft Clarity Act includes a provision barring the SEC from classifying any token serving as the principal asset of a US-listed spot ETF as of 01/01/2026 as a security, which would cover Bitcoin and Ethereum.

The Clarity Act draft creates a 60-day certification window where token issuers can submit evidence to the SEC; the agency's non-response effectively grants regulatory legitimacy.

Bitfarms, now Kiel Infrastructure, reported a $145 million net loss in Q1 2026 as it transitioned from Bitcoin mining to AI, selling 2,690 Bitcoin for $20 million in proceeds.

German Finance Minister Lars Klingbeil plans to eliminate the tax exemption for digital assets held over 12 months, aiming to close a €98 billion deficit in the 2027 budget.

April CPI data showed prices rose 0.6% month-over-month and 3.8% year-over-year, with core CPI at 0.4% monthly and 2.8% yearly.

US Indo-Pacific Command confirmed it is running a Bitcoin node and experimenting with the protocol, citing its utility as a computer science tool for power projection.