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DOJ emails show Coinbase co-founder discussed meeting Jeffrey Epstein during 2014 investment talks

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DOJ emails show Coinbase co-founder discussed meeting Jeffrey Epstein during 2014 investment talks

Newly unsealed Justice Department documents reveal that Coinbase co-founder Fred Ehrsam was involved in emails regarding a $3 million investment from Jeffrey Epstein in 2014, long after Epstein’s initial conviction.

While Epstein’s stake was less than 1% and he held no governance role, the records show Ehrsam expressed interest in a meeting during the funding round.

The files show that Epstein’s team had direct communication with Ehrsam, a member of the Coinbase Board of Directors and co-founder, who discussed a possible meeting in New York related to a $3 million investment.

“I have a gap between noon and 3 PM today, but again, not crucial for me, but would be nice to meet him if convenient. Is it important for him?” Ehrsam wrote in an email chain that included representatives from crypto entrepreneur Brock Pierce’s VC firm, Blockchain Capital. In the same thread, another email states that Epstein was “in a full afternoon board meeting yesterday.”

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Coinbase did not return a request for comment.

In an email dated Dec. 2, 2014, Pierce — the child actor turned entrepreneur who later co-founded Block.one, which in turn launched CoinDesk parent Bullish Global in 2021 — contacted Epstein about an opportunity to invest in Coinbase’s Series C fundraising round.

Pierce, who also co-founded Tether and reportedly had a lengthy relationship with Epstein, wrote, “On another diligence call with the co-founder. First close happened today. Round should be fully committed by Wednesday. $12M / 20% of the round can be taken. This is the most platinum-plated deal in the space.”

That same day, Epstein sought advice from LinkedIn co-founder Reid Hoffman on whether to participate in the round. Hoffman replied that he did not have deep insight into Coinbase and advised against participating, writing, “I probably wouldn’t play.”

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But Epstein ended up investing in the company separately from Blockchain Capital.

Emails from Blockchain Capital co-founder W. Bradford Stephens dated Dec. 3, 2014, state that Blockchain Capital intended to invest approximately $3.25 million in Coinbase, spread across three affiliated entities.

Within the same email chain, Epstein’s longtime associate Darren Indyke identified the investing entity as “IGO Company, LLC, which is a USVI limited liability company.”

A valuation report dated Dec. 31, 2014, included in the DOJ release lists a transaction described as “Purchase of Coinbase via IGO LLC (3,001,000),” and lists Coinbase as an investment held through IGO LLC in that amount.

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‘Opportunity to invest’

As more businesses and individuals named in the Epstein documents have sought to distance themselves from him, legal and reputational risk has become a key concern. In 2023, JPMorgan Chase and Deutsche Bank paid a combined $365 million to settle lawsuits brought by Epstein’s victims, who alleged the banks enabled his sex-trafficking operation by providing financial services.

Against that backdrop, Blockchain Capital, which is widely referenced in the documents, said the original fund investment was never completed.

Blockchain Capital did not respond to a CoinDesk request for comment, but in an emailed statement to Decrypt, a representative said, “In 2014, Brock Pierce was in contact with Mr. Epstein in relation to fundraising. As part of those discussions, an opportunity to invest in Coinbase’s Series C was also discussed via email.”

The representative added that a fund investment “was never consummated,” and that Epstein instead invested independently through IGO Company LLC.

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However, a few years later, Blockchain Capital attempted to buy Epstein’s stake in the crypto exchange.

In January 2018, Blockchain Capital initiated discussions with Epstein’s associate, Indyke, about purchasing the Coinbase position held through the LLC. “We would be willing to buy the position from you at a $2b [billion] valuation,” Stephens wrote, adding that Blockchain Capital would pay roughly $15 million for the stake.

Later emails show negotiations focused on selling half of the Coinbase position held in IGO LLC. Indyke wrote that Epstein believed the company’s value exceeded $3 billion and that he had received “two other bids” for the stake.

On Jan. 31, 2018, Stephens responded that Blockchain Capital’s offer to buy 50% of the position at a $4 billion valuation remained open.

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“The price for the 50% interest is $14,666,667,” Stephens wrote, a price that would imply a gain of more than $11 million on the portion of the Coinbase stake sold, according to the emails. In a Feb. 1, 2018 email, Indyke confirmed agreement to the transaction, writing, “Jeffrey agrees that he will sell you 50% of his LLC.”

A valuation report dated Aug. 31, 2018, said Epstein had sold half of his Coinbase stake, saying “50% sold for $15mm [million] Feb 2018.”

Epstein was arrested on federal sex trafficking charges on July 6, 2019, and was held at the Metropolitan Correctional Center in New York City. He died by alleged suicide on Aug. 10, 2019, after being found unresponsive in his cell.

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Aave V4 passes ARFC stage, moves toward mainnet launch: Aave

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Aave V4 passes ARFC stage, moves toward mainnet launch: Aave

Aave V4 has successfully completed the Aave Request for Comments stage, with the protocol’s team now preparing for final AIP deployment and mainnet launch.

Aave V4 has passed the ARFC (Aave Request for Comments) stage, according to an announcement from Aave founder Stani Kulechov on March 23. The protocol is now moving toward final AIP (Aave Improvement Proposal) deployment and a controlled mainnet launch with a focus on security, Kulechov said.

The ARFC stage represents a preliminary governance phase where protocol proposals are discussed before formal on-chain voting. Aave’s development team has been working to bring V4 to mainnet, with the next steps involving final AIP deployment followed by the launch itself.

Sources: Stani Kulechov (X/Twitter)

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This article was generated automatically by The Defiant’s AI news system from publicly available sources.

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DeFi Has Seen Resolv’s $25M USR Exploit Many Times Before

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The Resolv hack wasn’t a surprise. The same structural flaw has drained hundreds of millions from Morpho, Euler, and Fluid over the past year and the industry kept building on top of it anyway.

On a quiet Sunday morning, someone turned $100,000 into $25 million in about seventeen minutes.

The target was Resolv, a yield-bearing stablecoin protocol. By the time Resolv paused its contracts, its dollar-pegged stablecoin USR had crashed to pennies. It remains deeply depegged, trading around $0.25 as of this writing, down more than 70% on the week.

The blast radius extended well beyond Resolv. Fluid/Instadapp absorbed more than $10 million in bad debt and had outflows of over $300 million in a single day, the worst outflow in its history. Fifteen Morpho vaults were hit. Euler, Venus, Lista DAO, and Inverse Finance all moved to pause USR-related markets.

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The mechanism that caused the initial hack to spread its damage – pricing a depegged stablecoin at $1 in a lending market– is not new. It happened at least four times in the past fourteen months.

How the Hack Worked

USR’s minting followed a two-step off-chain process: a user deposited USDC via the `requestSwap’ function, and a privileged off-chain signing key, the `SERVICE_ROLE’, finalized the amount of USR to issue via `completeSwap’. The contract enforced a minimum output but had no maximum. Whatever the key holder signed, the contract honored.

The attacker gained access to that key through Resolv’s AWS Key Management Service. They submitted two USDC deposits, totaling roughly $100,000–$200,000, and used the compromised key to authorize 80 million USR in return. Etherscan shows two transactions worth 50 million USR and 30 million USR, minted in minutes.

“The Resolv USR exploit wasn’t a bug — it was a feature working exactly as designed. And that’s the problem,” said on-chain analyst Vadim (@zacodil).

The SERVICE_ROLE was a regular externally owned address, not a multisig. The admin key had multisig protection, but the mint key didn’t.

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“Resolv was audited 18 times,” Vadim said. “One finding was literally called ‘Missing upper [limit]’”

The attacker exited methodically, converting minted USR into wstUSR (the staked wrapped version) to slow the market impact, then rotating through Curve, Uniswap, and KyberSwap into ETH. The attacker’s wallet holds approximately 11,400 ETH (~$24M). Resolv’s collateral pool, the ETH and BTC backing the system, survived intact even as the stablecoin crashed.

How the Contagion Spread

The Resolv hack is two incidents stacked on top of each other. The first is the mint exploit. The second is a cascading lending market failure.

When USR and wstUSR collapsed, every lending market that had accepted them as collateral faced the same problem: their oracle was still pricing wstUSR near $1.

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Omer Goldberg, founder of risk analytics firm Chaos Labs, documented the mechanism. His key finding was that “The oracle is hardcoded and thus never repriced. wstUSR was marked at $1.13 while trading at ~$0.63 on secondary markets.”

Traders bought cheap wstUSR on the open market and posted it as collateral at the oracle’s $1.13 valuation on Morpho or Fluid, then borrowed USDC against it and walked away.

At Fluid, the team secured short-term loans to cover 100% of the bad debt and committed to making every user whole. At Morpho, co-founder Paul Frambot said ~15 vaults had significant exposure, all in high-risk, long-tail collateral strategies.

Prominent curator Gauntlet said that “A few high-yield vaults had limited exposure.”

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But D2 Finance challenged that framing directly, posting onchain data showing Gauntlet’s flagship “USDC Core vault” had $4.95M allocated to the wstUSR/USDC market. Goldberg later said Gauntlet vaults accounted for 98% of lender liquidity in that market.

“I think the curator industry is poorly designed because there’s not actual curation happening,” said Marc Zeller on X.

Resolv, Gauntlet, Morpho and Fluid did not respond to The Defiant’s requests for comments by press time.

A Recurring Failure

This is not a novel attack. In January 2025, Usual Protocol’s USD0++ was hardcoded at $1 on Morpho vaults by curator MEV Capital. Usual abruptly changed its redemption floor to $0.87 without warning, leaving lenders stuck in the MEV Caital vault as utilization spiked to 100%.

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In November 2025, Stream Finance’s xUSD collapsed after curators had routed USDC deposits into leverage loops backed by the synthetic stablecoin, leaving an estimated $285M–$700M at risk across Morpho, Euler, and Silo when its oracle refused to update. Moonwell suffered back-to-back oracle failures in October and November 2025, generating more than $5 million in combined bad debt.

What It Means for the Curator Model

Morpho’s architecture outsources all risk decisions to third-party “curators” who build vaults, choose collateral, set loan-to-value ratios, and select oracles. The theory is that specialist firms have deeper expertise, competition drives better risk management, and the protocol enforces rules.

But curators earn fees on yield generated, which creates an incentive to accept riskier, higher-yield collateral, like yield-bearing stablecoins. The downside is that when those stablecoins depeg, the losses fall on depositors, not on the curator. In the Resolv case, some curators had automated bots still refilling affected vaults hours after the exploit started, deepening losses.

The reason to hardcode oracles for yield-bearing stablecoins is to prevent short-term volatility from triggering unnecessary liquidations. But that protection only works as long as the stablecoin remains stable.

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Chainalysis said in a post-mortem that real-time chain detection is needed.

“The on-chain smart contract worked perfectly. The broader system design and off-chain infrastructure apparently did not,” the analytics firm said.

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Bitcoin Spot Volumes Drop To 2023 Lows as Rallies Lack Spot Conviction

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Coinbase, Cryptocurrencies, Bitcoin Price, Markets, Cryptocurrency Exchange, Bitcoin Futures, Binance, Price Analysis, Market Analysis

Bitcoin (BTC) spot volumes on Binance have dropped to their lowest level since September 2023, indicating that the current intraday price rise may not be backed by strong demand.

The rally above $71,700 on Monday appears to be driven mainly by news headlines and liquidations in the Bitcoin futures markets.

Binance volumes and exchange flows signal the demand gap for BTC

Crypto analyst Darkfost said that March is on track to record the lowest Binance spot volume since Q3 2023, at roughly $52 billion, compared to the $88 billion recorded in September 2023. The activity levels align with the prior bear market conditions, pointing to the reduced participation.

Coinbase, Cryptocurrencies, Bitcoin Price, Markets, Cryptocurrency Exchange, Bitcoin Futures, Binance, Price Analysis, Market Analysis
BTC spot trading volume. Source: CryptoQuant

The exchange flow data shows a similar slowdown. Crypto analyst Arab Chain reported $6.38 billion in seven-day cumulative flows on Binance and $5.14 billion on Coinbase. The Binance flows have dropped to the lowest level since 2024, indicating reduced deposit activity.

However, the lower inflows may also coincide with a reduced supply to sell, as fewer coins move onto the exchanges. The Coinbase flows remain relatively stable, reflecting the steadier participation from the long-term investors.

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The large-holder activity added another layer. Market analyst Gaah identified a record surge in the whale inflow momentum, which tracks the rate of change in large transfers to the exchanges.

The current reading of 74.3 surpasses all prior cycle peaks over the past 11 years, with a higher level last recorded at 124.6 in 2015. 

The elevated inflow velocity signals an aggressive capital rotation and hedging, increasing BTC’s sensitivity to short-term volatility over the next few weeks.

Coinbase, Cryptocurrencies, Bitcoin Price, Markets, Cryptocurrency Exchange, Bitcoin Futures, Binance, Price Analysis, Market Analysis
Bitcoin momentum whale inflow ratio. Source: CryptoQuant

Related: Bitcoin rebounds to $71K as oil drops after Trump signals pause on Iran strikes

Bitcoin liquidation activity shows traders lack conviction

The BTC rally followed reports that President Trump had deferred the planned US strikes on Iran’s energy infrastructure for five days after citing progress in the diplomatic discussions, a claim later rejected by Iran’s foreign ministry, which denied that any talks had taken place.

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BTC still pushed to a weekly high of $71,789 on Binance during the US market session, driven by the above external catalyst rather than by spot demand or futures positioning, leading the move.

Data shows the rally coincided with a reduction in leverage. The aggregated open interest declined by about 9,700 BTC, marking a 4% drop over 13 hours.

The open interest tracks the total number of active futures contracts, and the decline during a price increase signals that the positions were being closed rather than new ones being opened.

BTC/USDT price, aggregated open interest, liquidation, and Coinbase premium. Source: velo.data

This type of move typically occurs when short positions are forced out of the market, reducing the total exposure while pushing the price higher. Binance recorded over $44 million in short liquidations within one hour, the largest since the one-hour long liquidations of $53 million on Feb. 6.

The Coinbase premium (in percentage terms) remained negative during the move, indicating limited spot demand from US participants.

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The falling open interest, high liquidations, and weak premiums suggest the move higher was driven by positions being closed rather than new money entering the market, with most of the activity clustered around the $71,000–$72,000 range.

Related: Gold slides as traders eye sub-$50K BTC: Five things to know in Bitcoin this week