Celsius Network's customers, almost a year after the platform halted withdrawals and filed for bankruptcy, just won a chance to take aim at one issue — its alleged fraud, Crystal writes.

• The judge presiding over Celsius' bankruptcy proceeding yesterday approved a motion to file what is called a class claim against Celsius Network Limited (CNL) or its affiliates.

Why it matters: That would allow roughly 600,000 Celsius account holders to assert claims based on fraud or negligent misrepresentation — and do so free from the technicalities of contractual claims that have dominated the case.

• That gives Celsius account holders who have been wronged a go at seeking a claim, while plans to redistribute funds and already-approved withdrawals continue.

State of play: Since Custody withdrawals started in late March, $32 million have been completed, representing 65% of the distributable value, through April 16.

• A breakdown of estimated recoveries per the debtors' general counsel: Custody, 72.5%, Earn, still subject to change is 50%, and Withhold, estimated at 60%.

What they're saying: "Account holders, as a constituency, ultimately suffered common injuries from Celsius’s misconduct," a court document filed by White & Case in connection with the class claim motion shows.

• Aaron Colodny, a White & Case lawyer and general counsel for a group of unsecured creditors, said findings in the U.S. Trustee's independent examiner's report support that fact.
• "The one thing they all agree with is that they were lied to. No one disputes that fact. Not even the debtors," he added.

Flashback: The U.S. Trustee-appointed independent examiner found that Celsius' grift started at the very beginning, with its whitepaper.

The other side: The U.S. Trustee objected to the motion, saying that the UCC's motion "seeks relief that is inconsistent with the Committee’s fiduciary duties towards all of its constituents and instead only focuses on one subsection."

• Series B preferred equity holders also objected, questioning whether they could satisfy class certification requirements, a court document shows.

Details: The hearing ran through a number of related agenda items and was among the spicier ones on record, with Celsius approaching the one-year mark of its bankruptcy proceeding, which started mid-July.

• Net cash rose to $166 million since, roughly 20% higher by March end.

What we're watching: How much in damages the class claim will seek.

• Debtors' counsel said it received three additional bids that would compete with NovaWulf's publicized one.

The latest meme coin to drop makes you wonder how it hadn't happened already: PEPE.

• Yes, the frog favored by the 4chan set and anyone who spent too much time on message boards in the early twenty-teens, Brady writes.

Here's the roadmap from the project website:

Phase 1: Meme

Phase 2: Vibe and HODL

Phase 3: Generational wealth

Should work!

By the numbers: The token supply is 420,690,000,000,000. All of that is in liquidity pools on decentralized exchanges already, except 6.9% the team has kept for bridges, listings on centralized exchanges and the like.

• Kinda goes without saying but: The team is anonymous.

Of note: There are reports that some folks have already made a lot of money off of it, but don't bet on the fire lasting too long.

Flashback: Pepe first appeared in a web comic called "Boys' Club" drawn by Matt Furie back in 2005.

The startup Fractal began raising money one week before FTX fell, and, weirdly, the unfortunate conflagration almost seemed to help the firm make its pitch to investors, Brady writes.

Driving the news: The company, founded to bring transparency to institutional crypto dealmaking, raised $6 million in a seed round led by Hack VC with participation from Archetype Ventures, Avalanche Ecosystem Fund, Blizzard, Circle Ventures and several others.

• Fractal creates tools that provide lenders, borrowers and market makers with visibility into all their counterparties' activities in a given trade.

Why it matters: Last year revealed that a lot of trades were happening based on thin due diligence. Fractal brings deals between large lenders and traders on chain, so it's verifiable end-to-end.

• In the bad old days, borrowers with strong reputations were using the same collateral to back multiple trades, because lenders had no way to see whether those assets were already spoken for by a competitor.

What they're saying: Even before FTX revealed that dangerous secrets could lurk under the surface at a major player in the market, "There were so many previous issues," Aya Kantorovich, a co-CEO of Fractal and alum of FalconX, tells Axios.

• She rattled off the examples from 2022 that preceded FTX: Luna, Three Arrows Capital, BlockFi, etc.
• "This needs to exist in the space," she said.

How it works: To simplify, Fractal does due diligence on crypto protocols and then writes smart contracts that enable counterparties to meet around strategies and capital objectives.

• A borrower will post the exact strategy they are looking to fund, while lenders will share risk profiles that look for the areas they are willing to back.
• Fractal's smart contracts will enforce that borrowers execute the strategy the lender agreed to and that borrowers have collateral posted transparently on-chain.
• Of note: As a product for institutional users, its platform is also monitoring protocols for risks outside the trade, such as security breaches.

Be smart: "Institutional" these days largely means high-powered trading firms, Kantorovich said. The pension funds and endowments are still on the sidelines and are likely to deploy simpler strategies when they do return.

Example: Say an investor wanted to earn the roughly 4% yield that can be attained by staking ethers on Ethereum right now.

• They could buy a bunch of ETH, stake it.
• Then they could also buy an option to sell all that ETH at today's price in six, nine or 12 months in case its price falls.
• That way, they are guaranteed to at least make the yield of their staked ETH without having to worry about losing the principal.

That trade can go bigger with a lender adding capital, which is where Fractal comes in.

The bottom line: "When it's on chain and you see that someone else is about to get margin called, everyone else in the industry can underwrite the entire risk," Kantorovich said.

🤷‍♂️ SEC chair Gary Gensler demurs on whether ethereum is a security while being grilled at the House Financial Services Committee hearing. (Wall Street Journal)

🍑 Unchained Capital, a lender and bitcoin custodian app, raised $60 million for its series B. (Unchained Capital)

👱‍♀️ Taylor Swift did her due diligence on crypto exchange FTX when floated a $100 million sponsorship deal. (The Block)

🎮 Legacy videogame brands look to NFT offerings despite objections or ambivalence from fanbase. (The Verge)

Crypto loves its archetypes, Brady writes.

There's not a ton to explain in this video. It's a funny rundown of the different types people take on while engaging in conversation.

• I don't know if it's intended, but the video implies to me the idea that people tend to move back and forth through these different roles, which I think is correct.