Wu says daily selection of encryption news - Cloudflare experiences widespread outage, multiple encryption platforms affected

1. Cloudflare experienced a large-scale outage, affecting multiple encryption platforms.

Cloudflare has experienced a widespread outage, leading to interruptions in some core internet services, affecting multiple encryption platforms. Websites such as Arbiscan, DefiLlama, and X are experiencing downtime or intermittent “internal server errors.” Cloudflare released a statement saying: “We are aware and investigating issues affecting multiple customers: widespread 500 errors, and Cloudflare's dashboard and API are also experiencing outages.”

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2. Arthur Hayes: The current decline in Bitcoin is mainly due to the contraction of dollar liquidity, rather than changes in fundamentals.

The decline in ETF and DAT capital flows has exposed the market to a negative liquidity environment again. Arthur pointed out that since July, approximately $1 trillion has evaporated from the dollar liquidity index, with ETF arbitrage capital withdrawing and DAT premium turning, causing Bitcoin to lose its “pseudo buying pressure.” The market needs to adjust first to realign with liquidity realities. He believes that BTC may further drop to the range of $80,000 to $85,000 in the short term, corresponding to potential credit events and rising U.S. Treasury yields. He expects that once U.S. stocks experience a 10% to 20% correction and Treasury yields rise, the Federal Reserve and the Treasury will be forced to initiate substantial easing again, and then Bitcoin may rapidly rebound to $200,000 to $250,000 by the end of the year.

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3. The White House reviews the CARF rules, the U.S. may strengthen tax reporting for overseas encryption accounts.

The White House is reviewing the proposed rules for joining the global encryption tax reporting framework CARF submitted by the Treasury Department. This framework, created by the OECD in 2022, aims to combat offshore tax evasion by enabling member countries to automatically share information about citizens' encryption assets. The Trump administration had previously supported advancing this rule and believed that joining CARF would help the IRS obtain information about U.S. taxpayers' overseas encryption accounts, reduce asset outflows, while not imposing new reporting obligations on DeFi transactions. The global implementation of CARF is expected to begin in 2027.

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4. The Ethereum Foundation promotes privacy tool frameworks, Kohaku provides modular privacy components.

Vitalik Buterin showcased the Ethereum privacy framework Kohaku at Devcon. This open-source project is promoted by the Ethereum Foundation and aims to provide modular on-chain privacy and security components for the ecosystem. It currently includes foundational components that can integrate protocols such as Railgun and Privacy Pools, supporting developers in providing a default optional privacy mode for Ethereum-related wallets and further exploring potential features like mixnet and ZK browsers.

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