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Dogecoin zooms as Elon Musk announces X Money launch date for April

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Here's how Elon Musk's SpaceX–Tesla merger could impact 20,000 bitcoin (BTC)

Elon Musk said late Tuesday that the payments features on social application X will go live next month.

Dubbed X Money, the feature turns X into a fintech app with peer-to-peer transfers, bank deposits, a debit card, cashback re

The platform is licensed in over 40 U.S. states through subsidiary X Payments and has Visa as a partner for account funding.

Dogecoin rallied as much as 8%, before reversing gains, after the annoucement despite it containing zero references to crypto. It hit nearly $0.10 over the past day before settling around $0.093, making it the best-performing major crypto over both 24-hour and seven-day periods.

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The reflexive move reflects a pattern that has played out multiple times since 2021. Musk says something about X payments, and DOGE pumps on speculation he’ll integrate it.

Musk has called dogecoin his “favorite cryptocurrency” and Tesla accepted DOGE for merchandise in 2022. But X Money as described is a pure fiat product, with peer-to-peer transfers, bank linking, debit card. That’s closer to Venmo with a social media app attached, not a crypto wallet.

As such, X’s head of product Nikita Bier said in February that crypto trading tools would come to X through Smart Cashtags, but clarified the platform wouldn’t execute trades or act as a brokerage.

It would provide data and links that redirect users to exchanges. Musk recently reposted a third-party forecast of X Money’s future features that included “crypto integration,” but the company hasn’t confirmed anything.

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The more interesting question for crypto markets isn’t whether DOGE gets added. It’s the 6% yield.

Six percent on a balance inside a social media app used by hundreds of millions of people is higher than virtually every U.S. savings account and competitive with money market funds. Whether it’s subsidized by X to drive adoption, generated by lending deposits, or backed by some other mechanism matters enormously for how regulators view it.

The timing collides with Congress fighting over the CLARITY Act, which would set rules for yield-bearing stablecoin products.

The Senate Banking Committee is targeting mid-to-late March for markup. The core policy question is whether non-bank platforms should be allowed to offer deposit-like yields to consumers.

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X Money isn’t a stablecoin product, but it’s targeting the exact same consumer demand, people looking for better returns than their bank offers, through a different regulatory path.

If X Money launches at scale with 6% APY before the CLARITY Act passes, it creates an awkward comparison. A fiat fintech product inside a social media app gets to offer yields that crypto stablecoin products are being legislated out of.

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Crypto World

Aave Founder Says DAOs Must Evolve

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Aave Founder Says DAOs Must Evolve

Stani Kulechov, the founder of decentralized lending platform Aave, says decentralized autonomous organizations (DAOs) need a rethink, namely, how much tokenholders vote on as opposed to input from leaders.

His comments came in the wake of governance disputes about the future of the protocol.

Kulechov said in an X post on Tuesday that DAOs, in their current form, are “extraordinarily difficult” to operate because of internal conflicts and proposals that can take weeks of forum posts, temperature checks and multiple votes to pass.

DAOs are intended to operate without core leadership, with all decisions made through community consensus; however, average participation rates in DAOs are estimated at 15% to 25%, which can lead to issues such as power centralization and ineffective decision-making.

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“DAOs also become politicized very quickly and it’s easy for voting to become about attention. Participants take sides, lean toward the loudest voices, and form political alliances to get their own proposals passed later,” Kulechov said.

Source: Stani Kulechov

“It can often feel like we took the worst parts of corporate bureaucracy and removed the parts that create accountability in the name of decentralization. But that doesn’t mean DAOs are doomed. They are far from that,” he added.

DAOs should keep what works, leave the rest

Kulechov said the path forward needs to involve DAOs keeping what they “got right” and fixing “what they got wrong.”

He proposes that rules should stay in the code, DAOs typically resolve decisions through smart contracts on a blockchain, the treasury should stay visible to everyone, and token holders should still have input on major decisions.

Related: Vitalik Buterin proposes using AI to strengthen DAO governance

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However, Kulechov argues that going forward, token holders shouldn’t vote on everything, because running the protocol day-to-day requires teams and leaders, not thousands of voters.

“Someone needs to wake up every morning with the full context in their head and make hard calls,” he said.

“The difference is that their decisions and performance are all on-chain and transparent, and token holders can fire the team when objectives are not met. Accountability is verifiable, and that is what separates this from a traditional company. There is no vendor lock-in.”

Aave governance proposals spark exit

Kulechov’s comments come amid a proposal, the “Aave Will Win Framework,” which passed a temperature check on March 1.

Source: Aave

Soon after, a major governance delegate, the Aave Chan Initiative, announced it would wind down its involvement with the Aave DAO over concerns with the governance standards and voting dynamics during the proposal process.

In January, another proposal to transfer control of Aave’s brand assets and intellectual property to its DAO failed, prompting renewed debate within the Aave community over the protocol’s long-term direction and governance structure.

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Magazine: The debate over Bitcoin’s four-year cycle is over: Benjamin Cowen