Happy Tuesday!

In today’s newsletter, we discuss several critical updates in the crypto and NFT space:

• Pudgy Penguins’ PENGU token goes live
• LastPass exploiters drain millions of dollars in crypto
• Lido begins phasing out its Polygon staking service

Meanwhile, Sen. Tim Scott reacted positively as crypto-skeptic SEC Commissioner Caroline Crenshaw’s renomination vote was scrapped.

Pudgy Penguins Launches PENGU Token on Solana

The popular NFT project Pudgy Penguins has launched its PENGU token, with holders having 88 days to claim their allocations before they are burned:

• Claims went live on Tuesday at 8 a.m. ET for holders of Pudgy Penguin ecosystem NFTs, confirmed by Luca Netz, CEO of Igloo, on X. Trading on centralized exchanges followed.
• Holders of Pudgy Toys, physical plushies inspired by the NFT collection, will also be eligible for PENGU tokens later.
• About 7 million wallets are eligible for claiming PENGU tokens, including users who interacted with various protocols.
• The token, launched on the Solana network, has a supply of 88.88 billion and plans future integration with Ethereum and Igloo’s Layer 2 Abstract Chain.
• Token allocations include 25.9% to the Pudgy Penguins ecosystem and 24.1% to other communities.
• After two hours, the token achieved a valuation of over $3.5 billion and over $290 million in trading volume.
• An unlucky trader burned $10,000 worth of SOL trying to trade the token before it was officially airdropped.
• Launched in 2021, Pudgy Penguins is now the second-largest NFT collection by market cap, surpassing Bored Ape Yacht Club.

LastPass Exploiters Drain Millions of Dollars in Crypto

ZachXBT reported on Tuesday that attackers from the 2022 LastPass breach had stolen an additional $5.4 million in crypto from over 40 wallets, later revised to $12.4 million:

• The stolen funds were exchanged for ETH and transferred to various exchanges.
• This marks the third significant hack tied to the LastPass breach since October 2023.
• ZachXBT warned anyone who stored seed phrases in LastPass to migrate their assets immediately.
• LastPass Chief Secure Technology Officer Christofer Hoff stated that there is no conclusive evidence linking the thefts directly to LastPass but invited security researchers to contribute evidence.

Lido Begins Phasing Out Staking Service for Polygon PoS Chain

Lido has decided to shut down its Polygon PoS staking services following a community vote due to limited adoption and resource-heavy maintenance:

• Users can withdraw funds until June 16, 2025, after which funds will only be available via explorer tools.
• This decision comes after Lido DAO also discontinued its Solana staking service last year.

Ethereum ETF Staking Yields Could Drive Institutional Adoption if Regulations Ease

Analysts from Bernstein and CryptoQuant suggest that under a potential Trump administration, regulations may ease, possibly leading to increased institutional adoption of Ethereum:

• Staking yields of 4-5% amidst declining interest rates could encourage inflows into Ethereum ETFs.
• However, consistent reward structures and regulatory clarity will be vital for institutional investors.
• U.S. Ethereum ETFs currently do not include staking due to SEC approval issues, putting them at a disadvantage compared to markets like Switzerland and Canada.

Tether Invests in StablR to Promote Stablecoin Adoption in Europe

Tether has invested in the European stablecoin issuer StablR, aiming to boost stablecoin adoption in Europe as the EU’s MiCA regulation approaches:

• StablR’s EURR and USDR stablecoins will integrate with Tether’s tokenization platform Hadron, expanding beyond Ethereum and Solana.
• Tether is looking to capitalize on Europe’s growing stablecoin market, which is nearing $400 million in euro-pegged assets.

In the Next 24 Hours

• UK and Eurozone CPI inflation figures release at 2 a.m. and 5 a.m. ET respectively on Wednesday. The U.S. Federal Reserve will announce its latest interest rate decision at 2 p.m., followed by an FOMC press conference at 2:30 p.m.

Never miss a beat with The Block’s daily digest of the most influential events in the digital asset ecosystem.

Updated with comments from LastPass.