And, we're back! The crypto team spent much of Tuesday and yesterday in cars, but we are getting caught up.

🚨 Situational awareness: The Fed signaled that 2024 may only have one rate cut in store. Bitcoin: 😢.

Today's newsletter is 1,088 words, a 4-minute read.

1 big thing: 😐 Terra settlement

Illustration: Annelise Capossela/Axios

Terraform Labs and founder Do Kwon have agreed to massive payments to settle its fraud case brought by the U.S. SEC β€” in the billions of dollars.

Why it matters: The death spiral of terraUSD (ticker UST), the stablecoin created by Terraform Labs, was the first of 2022's gigantic, headline-grabbing cryptocurrency disasters (followed by Three Arrows Capital and then FTX).

Between the lines: In a filing with the federal court in the Southern District of New York, the consent order would require the following:

  • $4.4 billion in remedy payments from Terraform labs and another $204 million from Kwon.
  • Various prohibitions on conduct from all defendants, including blocking Kwon from ever serving in a leadership role in a public company.
  • And, finally, Terraform Labs β€” which filed for bankruptcy in January β€” needs to enter into a Chapter 11 liquidation plan. Another $204 million would be transferred from Kwon to the bankruptcy estate to repay investors.

Context: Kwon was found liable of securities fraud in an April civil case, in the same court. The court must now review the settlement agreed to with the SEC.

Terraform Labs had offered a stablecoin that targeted price parity with the U.S. dollar. It became very popular because it also offered a savings product that paid 20% annual interest on deposits that could exclusively be made in that stablecoin.

  • Everything about the system was open and transparent, however. Everyone could see that the interest on the savings product was paid out of subsidies, not profits. One day, the market's nervousness about the approach turned into a panic.
  • It took the jury less than two hours to render its verdict on the scheme Kwon created.

State of play: When the Terra blockchain blew up in 2022, Terraform Labs forked it to launch a new one. See 2️⃣.

What we're watching: Whether or not Terraform Labs still has billions of dollars in assets.

  • When the SEC sent the filing, it noted that the agency would not say more about it until the court ruled on the proposed settlement.

2. Charted: 🌜 A billion dollars in blockchains

The line chart shows the daily market caps of Terra Luna Classic and Terra blockchains from Jan. 1 to June 13, 2024. Both cryptocurrencies experienced fluctuations, with Terra Luna Classic maintaining a higher market cap than Terra throughout the period. The value of the classic chain varies mostly between $800 million and $600 million, ending the period near the latter. The value of Terra varies mostly between $500 million and $400 million, ending the period just below the latter. The period's peak for both came in March.
Data: CoinGecko; Chart: Axios Visuals

Blockchains associated with Terraform Labs are still worth hundreds of millions of dollars.

  • Our thought bubble: 🀯

Catch up fast: When terraUSD blew up, Terraform Labs initiated a fork of the blockchain, with the idea being that other apps built on it could live on, even if the stablecoin died.

  • A group of diehards kept the original blockchain running, though, stablecoin and all.

By the numbers: Put those two chains together and you get tantalizingly close to a billion dollars in supposed value.

Reality check: The old Terra blockchain β€” the one that hosted the implosion β€” is worth much more today than the new one, this despite the fact that it's been maintained by a disparate group of grassroots users. Terraform Labs has continued to support the new chain.

  • It hasn't published a community update since February, however.

Context: The value here is the collective worth of all the core coins issued by each chain.

  • The old chain has luna classic (LUNC) and the new one held onto the terra (LUNA) brand.

Fun fact: There are 5.8 trillion LUNC tokens on the old chain, because when it originally failed, the chain started hemorrhaging out new tokens as it tried to buy UST stablecoins off the market to save the peg.

Yes, but: The stablecoin never recovered. It's worth about 2 cents. The best it's done since the collapse was a little over 4 cents.

What we're watching: If Terraform Labs still has a cache of LUNA and LUNC coins, that may be how it pays part of the legal bills above.

3. πŸ’Ž Metamask adds staking

Illustration: Annelise Capossela/Axios

Metamask just made it easy for its users to participate in staking.

Why it matters: Staking provides the yield native to the Ethereum blockchain.

Context: Metamask is far and away the most used cryptocurrency wallet on Ethereum, and maybe the most used software wallet, period.

Staking yield is paid in ether (ETH). So, in theory, a user could earn more ETH but, in real terms, that gain could all be lost quickly if the value of ETH were to take a dive.

  • However, though ETH's price increase has been slower than BTC's, it's been trending up over the last year.
  • Which means in real terms a staker is getting a double boon: both the increased value of their underlying ETH, plus more ETH.

By the numbers: On balance, stakers are earning a 3.36% rate of return lately.

The intrigue: Metamask has something of a captive audience of cryptocurrency users. Allowing them to join a staking pool with just one click must be attractive.

  • However, the company is not offering a tokenization of their stake, like other products such as Lido and Rocket Pool do. So Metamask users won't be able to get the double benefit of participating in re-staking.

4. πŸ‘Ÿ Catch up quick

Illustration: AΓ―da Amer/Axios

πŸšͺ White-label stablecoin company Paxos has let go of 65 employees, 20% of its headcount. (The Block)

🧾 Bitcoin miners are dumping their coins as revenues tighten post-halving. (Decrypt)

πŸ˜– The founder of the once-high-flying Curve DEX has been suffering millions of dollars worth of liquidations from lending markets. (The Defiant)

πŸ—ΊοΈ Coinbase released its latest state of crypto report, focusing on recent activity by large companies. (Coinbase)

5. πŸ•΅οΈβ€β™‚οΈ Milady token

Screenshot: @MiladyMaker333 (social media)

The Remilia Corporation, which has been behind some of the weirder projects where art and cryptocurrency make a sort of bizarre lovechild, just announced the Milady Cult Token (CULT).

Why it matters: Remilia's Milady NFTs are a top-10 project, with its floor price trending up over the last six months.

  • It's a project with a devoted community, and its holders will soon be rewarded as one of the recipients of this new token drop.
  • Half the tokens will be given to people who hold different products the group has released.

Zoom in: Remilia says there have been no private sales of CULT to venture investors behind the scenes.

  • An open pre-sale of CULT is running now, until June 19.

What we're watching: Remilia also announced a new product: Miladychan, an image board, likely in the spirit of the most famous image board on the internet, 4chan.

  • It will offer private and public chat channels as well as "hyperfinancialization" for its users, according to the release.
  • No release date was given.

6. 1,000 words: πŸ“· Wanna see the team?

Axios national editorial team. Photo: Axios

As a remote-work company, we don't get together much, but here are lots and lots of the folks who bring you the news every day.

  • Crystal, Brady and Pete are all in here if you want to hunt around.

We told you about MOMMY, so, of course, now there is DADDY. β€”C & B

This newsletter was edited by Pete Gannon and copy edited by Carolyn DiPaolo.