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Security Matters: How’s Zircuit Planning to Mitigate Hacks in Web3 (Interview)

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In the rapidly evolving landscape of Layer 2 networks, Zircuit aims to create a new approach to security and scalability. Co-founded by Martin Derka, a seasoned professional with a PhD in algorithms and complexity, sat with us for an interview during EthCC. Derka shared insights into his journey, the founding of Zircuit including the meaning of the whooping $3 billion staked ETH to the project, and above all – the expected launch date for Zircuit’s mainnet.

Multiple well-known investors have taken part in the protocol’s mainnet funding round, including Binance Labs, Nomad Capital, AMBER, and much more.

zircuit_ceo_cover

From Soccer to Crypto

Martin Derka’s journey into the world of crypto began after an unexpected turn in his career. “I have a PhD in algorithms and complexity,” Derka explained, detailing his academic background. “For many years, I was developing software for various companies while still a student.” His transition from academia to entrepreneurship was marked by a stint as CTO of a startup focused on car advertisement photography, which he co-founded in 2013. However, after internal disputes led to his departure in 2017, Derka sought new opportunities, eventually finding his way to the crypto sphere.

“After leaving the startup, I went to clear my head in Argentina and Chile,” Derka recounted. “Upon returning to Canada, I connected with Leo (Leonardo Passos, Ph.D), a former soccer buddy and one of the veteran employees of the crypto auditing giant Quantstamp.” This serendipitous meeting led to Derka joining Quantstamp as one of its earliest hires in 2018, where he delved deep into crypto security.

The Birth of Zircuit

Derka’s tenure at Quantstamp laid the groundwork for Zircuit. “At Quantstamp, we knew rollups would be key to scaling Ethereum,” Derka noted. This realization sparked intensive research into rollups, eventually leading to the inception of Zircuit. “We saw an amazing opportunity to enhance blockchain security proactively,” Derka said. “This is how the feature that now distinguishes Zircuit—sequencer level security—began.”

‘Many Uses of AI Seem Fabricated’

Zircuit’s most striking feature is its AI-driven security mechanism, sequencer-level security, a concept Derka elaborated on extensively.

“Our sequencer evaluates each transaction for malicious intent before inclusion in the block,” Derka explained. “We use AI to simulate transactions and assess their impact, determining if they’re hacks.” This proactive approach allows Zircuit to quarantine potentially harmful transactions, enhancing the overall security of the blockchain.

The sequencer is a privileged node designed to collect user transactions and order them based on predefined rules. In essence, once the transaction arrives at the sequencer, it is then routed to the “Malice Detection” module – something that the team refers to as the “oracle.” It’s designed to determine whether a transaction is benign or it can potentially be malicious. Those that are benign are queued for block inclusion, while those that are flagged are diverted to another module called “Quarantine-Release Criterion” module. It acts as a holding area for the time during which these transactions undergo a rigorous verification process.

The following can be seen in the overview presented by Zircuit:

zircuit_schema

When asked about the prevalent AI hype, Derka acknowledged the phenomenon but remained pragmatic. “There is a huge level of hype,” he admitted. “Many uses of AI seem fabricated, and AI can be highly inaccurate. But failure is part of innovation. If we don’t try applying AI in all possible areas, we might miss its true potential.”

L2’s: Do We Really Need That Many

Zircuit positions itself as a Layer 2 (L2) solution with a strong emphasis on security, amidst a crowded field of competitors. Derka was clear about the inevitability of multiple L2 solutions. “If we didn’t build another L2, someone else would,” he said. “The better question is why users should choose Zircuit over others, and that comes down to our unique security proposition.”

Despite the competitive market, Derka does not foresee a winner-takes-all scenario.

“Technologists love to build and compete,” he asserted. “There will always be new players challenging the status quo.”

Zircuit: When Mainnet Launch

Zircuit’s immediate focus is on launching its Mainnet, with significant milestones already achieved. “We launched our Testnet last year, which has been very stable,” Derka shared. “We are now in the process of deploying Mainnet, integrating partners, and ensuring security measures are in place.”

The Mainnet Phase 1 launch is scheduled for Augustmid-July in a gated mode, with a broader public launch expected soon afterin mid-August. “We are also working on optimizing zero-knowledge proof generation to reduce operating costs and improve efficiency,” Derka added. This technical enhancement is crucial for the blockchain’s functionality and user experience.

Over $3 Billion in Staked ETH

Derka is mindful of the challenges in sustaining Zircuit’s initial success: With over $3 billion in restaked Ether (at its peak) signaling strong interest, the true test will be retaining these funds post-launch. “It’s the best signal we currently have, but it’s not a guarantee of success,” Derka cautioned. “Our task is to support projects deploying on Zircuit, ensuring they attract and retain capital.”

Zircuit aims to create a robust ecosystem encompassing all essential blockchain functions. “We want a fully functional ecosystem comparable to other chains, with lending protocols, oracles, DEXs, and stablecoins,” Derka explained. The security aspect remains a key differentiator, offering users and developers a more secure environment for their projects.

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Metaplanet and K33 Deepen Bitcoin (BTC) Exposure With Strategic Initiatives

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In a strategic move to accelerate its Bitcoin acquisition goals, Japan-based Metaplanet issued $21 million in interest-free bonds to the Evo Fund on May 29, following a separate $50 million raise the previous day. These zero-coupon bonds, known as the 17th series, come with a $525,000 face value and are set to mature on November 28, 2025.

As they bear no interest, Metaplanet avoids additional financial costs tied to borrowing.

Metaplanet Adds to Bitcoin Warchest

According to the official document, the terms allow Evo Fund to initiate early redemptions with a five-day notice, either in full or in multiples of $525,000. Additionally, redemptions may be linked to future funding rounds with the same investor.

The bonds are unsecured, with no guarantees or administrators, which is in line with Japanese corporate law. Payment processing will take place at the company’s Tokyo office.

This fundraising effort contributes to Metaplanet’s larger goal of amassing 10,000 BTC by the end of 2025. Year-to-date, the company has raised $135.2 million, including previous rounds in February ($25.9 million), March ($13.3 million), and earlier in May ($25 million).

Currently holding approximately 7,800 BTC, worth around $840 million, Metaplanet ranks 11th among global corporate Bitcoin holders, with an average purchase price of $91,340 per BTC. In March, it used cash-secured put options to acquire 696 BTC, followed by an additional 145 BTC in April for $13.6 million.

Metaplanet isn’t the only company doubling down on Bitcoin. In Scandinavia, K33 is taking a similar approach.

K33 Joins Corporate Bitcoin Trend

K33, the Oslo-based cryptocurrency brokerage company, announced plans to begin holding Bitcoin on its balance sheet after raising 60 million SEK ($6.22 million). As per the announcement on May 28th, the funding was secured via interest-free convertible loans and a new round of share and warrant issuances.

The Norwegian firm confirmed that 100% of the funds will be used to buy Bitcoin, possibly acquiring up to 57 BTC at current prices. The firm secured 45 million SEK ($4.66 million) through loans maturing in June 2028, and 15 million SEK ($1.5 million) via equity and warrants. Investors converting their warrants before March 2026 will be granted additional free warrants, which would potentially allow K33 to raise a total of 75 million SEK ($7.77 million).

In its Q1 financial update, CEO Bull Jenssen said K33 is partnering with other Nordic Bitcoin treasury firms and intends to leverage its holdings to create Bitcoin-based services, including collateralized lending.

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Crypto Markets Shed $200B in 48 Hours as Bitcoin Dumps to 12-Day Low (Weekend Watch)

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Perhaps driven by the latest escalation of tensions between the US and China, bitcoin’s price has tumbled over the past 12 hours to a multi-week low of $103,000.

The altcoins have it even worse, with massive price drops from the likes of SUI, LINK, DOGE, SOL, ADA, and more. CRO has defied the market-wide trend with a double-digit price surge.

BTC Dumps to $103K

Ever since it skyrocketed to almost $112,000 last Thursday to chart a new all-time high, bitcoin’s price has been unable to recapture or even sustain its momentum. It started to fall on the next day when US President Trump recommended a new set of tariffs against the EU.

Although he delayed their implementation for over a month, BTC failed to bounce off decisively and was stopped at around $110,000 on a couple of occasions. The latest rejection, which came on Thursday at $109,000, was the worst one (for now) as it drove BTC down to $105,000.

It recovered some ground to $106,000 yesterday, but the bears reemerged and pushed the cryptocurrency south to a 12-day low of just over $103,000. This decline transpired after Trump said China “violated” the trade agreement between the two, while Beijing responded kindly.

Although BTC has regained some ground and now sits above $103,500, its market cap has slid to $2.06 trillion on CG, while its dominance over the alts has shot up to 61.3%.

BTCUSD. Source: TradingView
BTCUSD. Source: TradingView

Alts Bleed Out, Not CRO

The alternative coins have marked some big losses over the past day. Ethereum is close to breaking below $2,500 after a 4.5% drop. XRP has plunged beneath $2.15, while DOGE, SOL, ADA, SUI, LINK, and AVAX have plummeted by up to 9%.

The situation with the lower-cap alts is even more painful, as many, such as ENA, INJ, VIRTUAL, and PEPE, have charted double-digit price declines.

CRO is the only exception, having gained 17% in the past day and trading close to $0.11.

The total crypto market cap has seen roughly $200 billion gone in the past two days and is down to $3.360 trillion.

Cryptocurrency Market Overview. Source: QuantifyCrypto
Cryptocurrency Market Overview. Source: QuantifyCrypto
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Disclaimer: Information found on CryptoPotato is those of writers quoted. It does not represent the opinions of CryptoPotato on whether to buy, sell, or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk. See Disclaimer for more information.

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Ethereum Price Analysis: Is ETH Dumping to $2K Next as Momentum Fades?

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ETH continues to consolidate beneath a key resistance level around $2,800, struggling to break higher after a strong rally earlier in May.

While the bulls have held higher lows in the short term, repeated rejection from the same level raises questions about buyer conviction at these highs.

Technical Analysis

The Daily Chart

Ethereum is currently consolidating below the major resistance at $2,800, which aligns with the 200-day moving average. The uptrend that began near $1,500 has paused, and the RSI has slightly dropped below 70, reflecting weakening bullish momentum.

Despite this, the price remains above the 100-day MA and the previous breakout zone near $2,200, indicating structure remains bullish unless those levels are lost. A clean breakout above $2,800 would open the path toward the $3,400–$3,600 supply zone. On the other hand, failure to do so could trigger a retest of the $2,200 demand block.

The 4-Hour Chart

The 4H chart shows that the price has formed a clear ascending triangle between the $2,800 resistance and roughly $2,500 support. The structure resembles a potential distribution phase following two strong accumulation zones below $1,850 earlier this month. While ETH continues to set higher lows, the repeated rejection at the highs is starting to weigh on the short-term outlook.

The RSI is also hovering near 47, suggesting a neutral momentum shift. A break below $2,500 and the lower boundary of the pattern would signal bearish reversal toward $2,100, while a confirmed breakout above $2,800 would invalidate the distribution idea and favor upside expansion.

Sentiment Analysis

The Coinbase Premium Index is currently holding slightly above zero, indicating moderate spot demand from US-based investors. Historically, a rising premium has often preceded strong bullish trends driven by institutional or high-volume retail buyers on Coinbase. Although the current levels are not aggressively high, they reflect underlying strength in the spot market and a willingness to pay slightly more for ETH on U.S. exchanges.

If this premium begins expanding while ETH approaches resistance again, it could signal renewed confidence and front-running of a breakout. On the other hand, if the premium fades or turns negative, it may signal waning interest and a possible short-term top, which is the scenario that is seemingly occurring at the moment.

Therefore, if the demand from the US declines, it would be highly likely for ETH to go into a correction phase once more.

 

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Disclaimer: Information found on CryptoPotato is those of writers quoted. It does not represent the opinions of CryptoPotato on whether to buy, sell, or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk. See Disclaimer for more information.

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