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Shares of Applied Digital (APLD), a Texas bitcoin mining and data center firm, dropped sharply on Tuesday after the digital infrastructure provider reported quarterly results that fell short of Wall Street expectations.

The company, which has pivoted from its crypto mining roots to focus on high-performance computing (HPC) and AI-focused data centers, reported revenue of $52.9 million for the quarter ending February 28, 2025—a 22% increase from a year earlier, but well below analysts’ consensus estimate of $64.5 million, a nearly 18% miss.

Despite the top-line miss, Applied Digital reported a non-GAAP net loss of $0.08 per share, beating analysts’ expectations of a $0.10 per-share loss. However, adjusted EBITDA came in at $10 million, a 41% miss compared to the expected $16.9 million, signaling continued margin pressure amid heavy infrastructure investments.

APLD shares plunged as much as 30% from the Monday close, and were trading around $3.90 in the early hours of the session.

A significant drag came from the company’s Cloud Services unit, which posted a sharp sequential revenue decline of 36%, falling from $27.7 million in the prior quarter to $17.8 million. Applied Digital attributed the drop to a shift from single-tenant contracts to a multi-tenant, on-demand GPU model—a transition that faced initial technical challenges.

Notably, the company’s board of directors approved on April 10 a plan to sell the Cloud Services business entirely, aiming to refocus on its core HPC data center operations and potentially position itself as a real estate investment trust (REIT) in the future.

“We believe separating the Cloud Services business from our data center operations better serves the long-term interests of our shareholders,” said CEO Wes Cummins on the company’s earnings call.

Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk’s full AI Policy.

Disclaimer: The analyst who wrote this piece owns shares of Strategy (MSTR).

From April 2024 to April 2025, investors in Strategy (MSTR) and the YieldMax MSTR Option Income Strategy ETF (MSTY) followed two distinctly different investment paths — one seeking capital appreciation through bitcoin (BTC) exposure, the other pursuing monthly income via options-based strategies. Both are linked to the performance of MSTR, but their outcomes and structures diverged significantly.

Strategy, listed on the Nasdaq, has evolved from an enterprise software company into a de facto bitcoin proxy. As of April 15, the company holds 531,644 BTC, making its stock highly sensitive to bitcoin’s price movements. Since adopting its bitcoin treasury strategy in August 2020, MSTR shares have surged over 2,500%. However, this growth comes with volatility: Currently, the stock has an implied volatility of 87%, and a 30-day historic volatility of 102%. MSTR is currently 43% below its all-time high set in November 2024, reflecting the sharp swings typical of a bitcoin-correlated asset. The stock pays no dividend.

In contrast, MSTY, launched in April 2024, is an income-focused ETF that does not hold MSTR shares directly. MSTY’s portfolio consists primarily of U.S. Treasury bills, cash, and short-term call options on MSTR, allowing it to synthetically replicate exposure without directly owning the stock.

It employs a synthetic covered call strategy, selling options on MSTR to generate monthly income. This strategy limits upside participation but delivers consistent cash flow, appealing to investors seeking regular distributions.

From April 4, 2024 to April 9, 2025, a $1,000 investment in each product produced the following results:

MSTR: Fueled by bitcoin’s strong 2024 rally, the investment grew to $1,895, generating a +86% total return.

MSTY: With 13 monthly distributions totaling $36.53 (ranging from $4.13 in April 2024 to $1.33 in April 2025) reinvested on each ex-dividend date, the investment reached $1,591, a +59% total return.

However, MSTY declined 45% over the year due to its full downside exposure to MSTR’s price movements, without benefiting fully from MSTR’s rallies because of its call-writing strategy. Additionally, consistent high monthly distributions — partly classified as return of capital — reduced the fund’s net asset value over time, further weighing on its share price.

MSTY exhibited significant volatility in its own right, often trading at premiums or discounts to net asset value (NAV), introducing additional price risk.

The premium/discount activity in MSTY reflects both investor demand and underlying volatility in MSTR. Early high volatility supported strong option income and trading premiums, but as volatility eased in 2025, premiums narrowed and discounts appeared more often. However, a renewed bitcoin rally and rising volatility in MSTR could reverse this trend, lifting option income, distributions, and investor demand.

While both products are linked to MSTR’s price action, they serve distinct purposes: MSTR offers high-risk growth potential tied to bitcoin, while MSTY delivers yield through a derivatives-based income strategy with inherent structural limitations.

Unlike traditional income strategies that focus on low-volatility, stable-yield investments like broad index ETFs or dividend stocks. MSTY is geared toward retail investors seeking exceptionally high income — but who are also willing to accept significantly higher risk and volatility.

While U.S. issuers are still waiting for the approval of a spot Solana (SOL) exchange-traded fund (ETF), Canadian investors will be able to trade such funds on the Toronto Stock Exchange starting Wednesday.

Four asset managers are set to bring their product to the market, including Purpose, Evolve, CI and 3iQ, all of which will have staking abilities as well, according to a TD Cowen note shared by ETF analyst Eric Balchunas.

Consensus 2025 takes place in Toronto May 14-16. Click here for tickets.

The funds were approved by the Ontario Securities Commission (OSC) on Monday, according to the note.

Meanwhile, issuers in the U.S., including Grayscale, Franklin Templeton, 21Shares, Bitwise, VanEck and Fidelity, are still waiting for the green light from the Securities and Exchange Commission (SEC) to launch a spot Solana fund.

There are currently two ETFs tracking SOL futures trading on U.S. markets, the Volatility Shares Solana ETF (SOLZ) and the Volatility Shares 2X Solana ETF (SOLT), both of which have attracted a relatively small amount of assets, around $5 million for SOLZ and $10 million for SOLT.

The spot crypto ETFs, however, have seen immense success among investors, attracting multiple billions of dollars over the course of a year, with the bitcoin (BTC) ETFs becoming the most successful ETF launch in history.

The Department of Justice recently issued new guidance directing prosecutors to scale back their efforts to investigate and litigate cryptocurrency crimes. This subsequently disbands the government’s National Cryptocurrency Enforcement Team (NCET) in an effort to prioritize immigration and procurement issues over cryptocurrency enforcement. While the DOJ frames this as a move to streamline resources, threat actors are watching – and adapting.

While it’s too early to observe its impact on the cryptocurrency world, I believe this move is more than a bureaucratic shuffle – it signals an enforcement vacuum that cybercriminals will rush to fill.

When Regulations Relax, Fraud Follows

Cybercriminals are highly adaptable and thrive in moments of regulatory ambiguity. When criminal enforcement – whether of blue-collar or white-collar crime – becomes limited, threat actors take note and often shift their operations outside the lines of prosecutable conduct. The same is true of the cryptocurrency space.

In the digital economy, especially within the decentralized, unregulated, and fast-moving world of Web3 and crypto, this gray area is fertile ground for impersonation scams, fake airdrops, phishing campaigns, and spoofed tokens.

Even before this policy change, scams involving fake coins, phishing sites, and wallet siphons were already on the rise. According to the FBI’s latest Cryptocurrency Fraud Report, cryptocurrency fraud amounted to $5.6 billion in losses, a 45% increase since 2022.

Now, as the glare of federal scrutiny moves away from the crypto space, individuals, exchanges, and brands otherwise vulnerable to impersonation must prepare for a rise in cryptocurrency fraud. Cybercriminals will continue to exploit platforms and dupe investors, especially in spaces where technical complexity, anonymity, and lack of regulation already hamper detection and enforcement.

Reactions from the Field: Relief or Concern?

The administration’s decision to rethink crypto enforcement has already elicited mixed reactions from legal experts, who echo the sentiment that the move may elicit fraudulent activity.

In a statement to the Washington Post, Vanderbilt University Law Professor Yesha Yadav underscored the importance of the NCET in disrupting criminal activity across the crypto space, noting that the government may find it harder to prosecute the “incredibly nimble, very opportunistic actors in this space.”

Similarly, Kleptocracy Initiative director and anti-corruption expert, Nate Sibley, emphasized that “Dangerous US adversaries rely on cryptocurrencies to launder money and evade sanctions.” 

However, a different tune can be heard within the industry. Advocacy group DeFi Education Fund, which is led by executives from organizations including Coinbase and Kraken, Executive Director and Chief Legal Officer Amanda Tuminelli stated that it was heartened to see that the DOJ announced it is redirecting resources to prosecuting the bad actors who are actually culpable for misuse of technology rather than the builders of our financial future.”

On one side, experts looking from the outside warn that the move may lead to an increase in cybercrime, while those within the industry argue that shifting focus to crimes relating to terrorism and drug cartels is a better use of resources. Only time will tell which side is correct.

Frictionless Fraud: AI Lowers the Bar for Bad Actors

Complicating matters is the increasing use of AI by attackers. With an arsenal of generative AI tools at the fingertips of anyone with an internet connection, fraudsters can now produce scams that go beyond phishing links – they’re full ecosystems of deception: fake social media accounts, copycat token launches, cloned websites, and AI-generated influencers pushing scams.

The result? Digital fraud is not only becoming more prevalent, it’s becoming more believable and harder to detect.

What does this mean for those trying to build a safer crypto ecosystem?

How the Crypto Community Can Respond

As the United States government reprioritizes its criminal focus, the responsibility of protecting investors and brand reputations will fall even more heavily on the private sector. Here’s how blockchain platforms, exchanges, brands, and investors operating in this space can respond:

Audit your brand perimeter: Regularly scan for unauthorized token listings, fake domains, and imposter accounts.

Use threat intelligence tech: AI-powered monitoring can detect spoofed websites and phishing campaigns across Web2 and Web3.

Engage with regulators early: Don’t wait for regulation to hit. Anticipate it, and build compliant, trustworthy systems before it’s too late.

Collaborate across the ecosystem: Whether you’re a small-time investor or an exchange with billions of dollars of assets under management, sharing information across platforms (i.e., between exchanges, social media platforms, and wallet providers) is key to identifying emerging fraud patterns.

The DOJ’s pivot may be strategic. But its ripple effects — especially in a fast-moving space like crypto — are already visible. If you’re building in web3, now’s the time to tighten your defenses. Because for every dollar the government pulls back, bad actors are investing tenfold.

At the heart of every financial system – traditional or decentralized – is trust. And, right now, trust is one of crypto’s biggest vulnerabilities. Widespread impersonation and scams, coupled with limited enforcement, have created a sense of skepticism that keeps the broader public on the sidelines.

If companies operating in the crypto space want digital assets to become mainstream, they must take ownership of building trust from the ground up. That means doubling down on transparency, accountability, and proactive protection. Because until trust becomes the norm, adoption will remain the exception.

Decentralized finance (DeFi) protocol Ethena has agreed to wind down its operations in Germany.

The decision comes three weeks after BaFin, Germany’s finance regulator, identified “serious deficiencies” in Ethena’s USDe token and said that the company was offering securities in Germany without approval.

“We have agreed with BaFin to wind down all activities of Ethena GMBH and will no longer be pursuing the MiCAR authorization in Germany,” Ethena said in a tweet.

It added that all previous users will be onboarded to Ethena BVI, the protocol’s entity in the British Virgin Islands.

Ethena is the yield-generating protocol with $4.9 billion in total value locked (TVL). The USDe token is dubbed a “synthetic dollar” and is backed by bitcoin (BTC), ether (ETH) and other cryptocurrencies.

Ethena’s ENA token is down by 2.88% in the past 24 hours, underperforming against the wider market which is up 1.17%, according to CoinMarketCap.

Marc Boiron, CEO of Polygon Labs, speaks with a practiced clarity that reflects his background as a lawyer. Over the course of our conversation, he outlines Polygon’s strategy to position itself as the connective tissue in an increasingly crowded blockchain ecosystem. As competition intensifies and market conditions fluctuate, Polygon is betting on a new product called AggLayer to unify the fragmented world of blockchain – a vision that’s ambitious, though not without its challenges.

Boiron’s path to blockchain leadership followed an unconventional route through legal corridors. A former law firm partner, he served as Chief Legal Officer at dYdX before joining Polygon Labs in a similar capacity, eventually ascending to CEO. He talked about blockchain infrastructure, as the industry confronts questions of interoperability, scalability, and practical utility.

Boiron is a speaker at this year’s Consensus festival in Toronto May 14-16.

CoinDesk: Your background is primarily in law rather than technology. Tell me about it?

Boiron: I’m the CEO at Polygon Labs. I’ve been the CEO for about two years now. Before that, I was the Chief Legal Officer at Polygon Labs for about a year. I joined Polygon after having been the Chief Legal Officer at 0x for a while. I was frankly just really excited about joining a team that was looking to scale Web3 in the way that Polygon is.

Before being on the Polygon legal team, I was a partner at various big law firms in the U.S., advising on crypto since 2017.

CoinDesk: Polygon describes itself as building an ‘Internet of Value.’ That’s a compelling phrase, but what does it actually mean in concrete terms?

Boiron: From Polygon’s perspective, we’re trying to build a trustless internet that makes it easily accessible to anyone to do whatever they want whenever they want with their assets. The way that shows up is through a product that we are developing called the AggLayer. The AggLayer is intended to be a form of settlement for every chain across crypto in general.

The Internet of Value contrasts with today’s internet, which is primarily the Internet of Information. Web3’s fundamental innovation is bringing actual value on-chain. The challenge we face is how to scale this capability across the entire digital ecosystem

Right now the answer is many different blockchains that exist. But if you actually want to have something that feels like the internet of information becoming the internet of value, you need something that brings together all of those chains so that you can get a massive amount of transactions happening across all of these chains, but in a seamless way that feels just like the current internet. So the Internet of Value really gets brought to life through AggLayer.

CoinDesk: Interoperability has been promised by many projects over the years. What technical approach is Polygon taking with AggLayer that you believe will succeed where others have struggled?

Boiron: AggLayer is a product designed to unite all of Web3 on a single settlement layer. Currently, what’s missing in the ecosystem is a secure way to move between different chains.

The only effective solution for secure and rapid cross-chain movement is to use a settlement layer like AggLayer. In practice, this means the ability to finalize transactions between two different chains in less than two seconds.

Our model differs from other cross-chain infrastructure in how it handles asset transfers. We monitor all assets moving in and out of chains. When someone initiates an asset transfer out of a chain, we use pessimistic proof to verify and confirm the assets’ existence on that chain before allowing the transfer.

Currently, this system works exclusively with Polygon CDK chains. However, we’re launching an update soon that will allow any EVM chain to connect to AggLayer. This expansion brings us closer to our vision of unifying all of Web3 through AggLayer.

CoinDesk: Real-World Assets on blockchain have been discussed for years with limited practical implementation. What’s your perspective on RWAs, and how do they fit into Polygon’s overall approach to the market?

Boiron: One of Polygon’s core strengths has always been our relationships with financial institutions, which is crucial for both real-world assets (RWA) and payments.

When it comes to payments, Polygon POS hosts nearly 50 stablecoins. Every major fintech player that operates on other chains is also on Polygon, though many Polygon-based companies operate exclusively on our platform.

For instance, Lemon Cash in Argentina operates exclusively on our platform. Other major payment companies like Stripe process most of their volume through Polygon POS, while companies like Grab in Singapore use Polygon POS alongside other chains.

We’ve established 18 tokenized funds on Polygon POS, and our strategy focuses on making these assets truly functional. Currently, most tokenized assets across chains remain dormant after creation, offering little advantage over their traditional counterparts.

Our focus is integrating these assets into DeFi, starting with enabling them as collateral in lending pools for borrowing purposes.

CoinDesk: How is Polygon responding to recent market volatility and regulatory developments?

Boiron: From our perspective, we just keep building regardless of what the environment is. We know what it is that we want to build, and we just keep building away at it.

The market reactions obviously impact adoption. Ultimately, the economy ends up impacting the adoption for everything in the world, and it’s no different for crypto. The only thing that we can do is keep building away, and as the market turns, being very well-positioned with great products that users want to use.

CoinDesk: Several new blockchains have launched with claims of superior performance metrics. How does Polygon position its original POS chain in this increasingly competitive landscape?

Boiron: I think Polygon POS is already very well-positioned for that. There’s a reason why we see payments being adopted on POS — it is because it is actually already fast and low-cost.

The thing with everything that we build, including Polygon POS, is that we’re continuing to adapt it. One of the things that’s exciting is that we get to see innovations across the space. People get to see how Polygon POS is innovated and adopt some of those things. We get to look at what others are doing and adopt some of their ideas as well as continuing to research and bring in new ideas ourselves.

So I think what you’ll end up seeing on POS is a chain that’s just as fast or faster than all of the new chains that we’re talking about here. The nice thing is that comes along with years of very good security and still maintaining the low costs that currently exist on-chain.

Tokens associated with artificial intelligence (AI) fared worse than the biggest cryptocurrencies over the past 24 hours. The relative weakness comes amid unusual activity in put options tied to shares of Nvidia (NVDA), the chipmaker that on Monday said it will will start building its AI supercomputers in the U.S.

While bitcoin (BTC), the largest cryptocurrency by market value, added 0.6% over 24 hours to $85,500, TAO, the token of blockchain-based machine learning network Bittensor, traded 3.6% lower at $239 and decentralized GPU rendering platform Render Network’s RNDR token was 1.7% down at $3.93, according to data source Coingecko. Other tokens, including FET, SEI and GRT lost 2%.

Nvidia short-dated put options saw notable activity on Monday, according to data tracked by Convex Value. The action was concentrated in the $100 strike put options expiring on April 17, April 25 and May 2. Additionally, there was activity in the $60 put expiring on April 17 and $50 and $85 strike puts expiring on May 16.

Convex Value called the activity in these so-called out-of-the-money put options at strikes below the Santa Clara, California-based company’s spot price of $110 unusual. “My bet would be [these are] protective plays,” an analyst at the platform told CoinDesk.

Buying a put option is akin to buying insurance against market slides. Traders typically snap them up when looking to profit from or hedge their spot/futures bets from a potential market decline.

“Someone knows something,” Substack-based analytics service Merlin Capital posted on X.

CoinDesk Indices presents its daily market update, highlighting the performance of leaders and laggards in the CoinDesk 20 Index.

The CoinDesk 20 is currently trading at 2503.6, up 0.1% (+3.51) since 4 p.m. ET on Monday.

Eight of 20 assets are trading higher.

Leaders: BCH (+1.0%) and BTC (+0.7%).

Laggards: APT (-3.5%) and NEAR (-3.0%).

The CoinDesk 20 is a broad-based index traded on multiple platforms in several regions globally.

Zero Hash, a crypto infrastructure firm specializing in stablecoin payment rails, said it has processed over $2 billion in tokenized fund flows over the past four months as demand for real-world assets is accelerating.

Tokenized real-world assets is a red-hot crypto sector, with several global traditional financial firms leveraging blockchain rails to record ownership and move assets such as securities, funds, commodities. They do so to achieve operational gains and near-instant settlements. It’s forecasted to be huge opportunity: BCG and Ripple projected the market to grow to $18 trillion by 2033.

Zero Hash’s stablecoin infrastructure serves as a key backbone for tokenized assets, supporting tokenized funds from traditional asset managers including BlackRock, Franklin Templeton and Republic, enabling around-the-clock stablecoin transactions across 22 blockchains. That includes BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL), Franklin Templeton’s BENJI, and the Hamilton Lane Private Infrastructure Fund.

The company supports seven stablecoins and handles regulatory compliance requirements for its partners, positioning it as a backbone for asset managers deploying tokenized versions of traditional instruments like treasuries and private credit.

The total value of tokenized real-world assets (RWAs) on public blockchains reached $20.6 billion, up from $15.2 billion at the end of 2024, according to data from rwa.xyz. Zero Hash claimed it processed roughly 35% of that net inflows.

“Tokenized finance is no longer theoretical,” Zero hash founder and CEO Edward Woodford said in a statement. “Institutions are deploying real capital to tokenization and need the payment infrastructure to match.”

Optimum, a decentralized, performance-enhancing memory layer for any blockchain, raised an $11 million seed round, inviting its creators from institutions like Harvard and MIT to jump from the world of academia into the commercial crypto arena.

The seed round was led by 1kx with participation from Robot Ventures, Finality Capital, Spartan, CMT Digital, SNZ, Triton Capital, Big Brain, CMS, Longhash, NGC, Animoca, GSR, Caladan, Reforge and others.

Optimum is building what it calls the missing memory layer of blockchains, making the way data is stored, accessed and propagated, faster, cheaper and truly decentralized, according to a press release.

At the core of Optimum’s innovation is a method of decentralized coding for distributed systems, known as Random Linear Network Coding (RLNC), developed by Muriel Médard, an MIT professor who is speaking at Consensus Toronto 2025.

“If you think of Web3 as a decentralized world computer, people have done an amazing job on the compute part; let’s say, the operating system,” Médard said in an interview. “But anybody who’s put together a computer knows that you also need a bus, which is the data propagation, and you need a memory, which we call the random access memory, as opposed to more static memory like a disk or the cloud.”

Without a scalable memory layer, blockchains face systemic inefficiencies, according to Médard, such as outdated gossip networks that redundantly propagate data, congested memepools that cause unpredictable delays and bloated nodes that make retrieval costly and complex.

Optimum’s memory infrastructure tackles inefficient data propagation, redundant storage and slow access, using Médard’s RLNC coding scheme.

Optimum is now live on a private testnet and is inviting L1s, L2s, validators and node operators to experience its decentralized memory layer in action.