Questions Around Shielded Systems
Zcash reveals vulnerability affecting its Orchard pool
Here is what we have in store in this Market Summary:
1. ZEC crashes 38% as Zcash discloses critical counterfeiting vulnerability
2. Kraken parent Payward plans to offer tokenized IPO access as investors await blockbuster debuts
3. Hong Kong taps JPMorgan, HSBC for expert group to scale tokenized bonds
4. Ether.fi allocates $100M to a Plume RWA vault, giving users access to yield
5. Moomoo expands into prediction markets through Kalshi partnership
ZEC crashes 38% as Zcash discloses critical counterfeiting vulnerability
Security researcher Taylor Hornby discovered a critical vulnerability in Zcash’s Orchard shielded pool, working with Anthropic’s Claude Opus 4.8 model during a targeted audit commissioned by Shielded Labs. The bug resided in two lines of code within the Orchard circuit and allowed a malicious actor to create unlimited counterfeit ZEC inside the shielded pool with no onchain signature.
The vulnerability had been present since Orchard’s activation in May 2022, a period of nearly four years, and was patched in an emergency fix by June 1. Due to Zcash’s privacy properties, there is no cryptographic way to confirm whether the exploit was used before the patch. Developers are now evaluating a network upgrade that would allow verification of the total ZEC supply and prove the absence of counterfeit coins.
Read the full article by Decrypt here
Kraken parent Payward plans to offer tokenized IPO access
Payward, the parent of Kraken, plans to let retail investors buy into the U.S. listed IPOs at the same offering price as institutional investors through tokenized shares. Under the xStocks framework, IPO allocations will be aggregated across participating platforms, with tokenized shares backed one-for-one by underlying stock held by a regulated custodian. Before a listing, eligible users submit non-binding indications of interest. On listing day, Payward finalizes allocations, tokenizes the shares, and distributes them to investors through participating platforms. xStocks are structured loan notes giving full price exposure without direct share ownership, and are currently restricted to non-U.S. users, with U.S. Kraken customers accessing conventional IPO stock through Alpaca Securities and ClickIPO via Kraken Securities.
Read the full article by CoinDesk here
Hong Kong taps JPMorgan, HSBC for expert group to scale tokenized bonds
The Hong Kong Monetary Authority has established a Tokenised Bond Expert Group comprising 21 institutions spanning banks, law firms, market infrastructure providers, and digital asset companies to support the development of the city’s tokenized bond market. Members include HSBC, Standard Chartered, UBS, Bank of China (Hong Kong), and JPMorgan Securities, alongside law firms including A&O Shearman, Clifford Chance, and Linklaters, as well as Ant Digital Technologies, HashKey Group, and market infrastructure operator CMU OmniClear.
Read the full article by The Block here
Ether.fi allocates $100M to a Plume RWA vault, giving users access to yield
Plume and ether.fi have launched a yield-bearing RWA vault with an exclusive $100M allocation from ether.fi. The vault, available directly through ether.fi’s app, gives users access to institutional-grade real-world asset yield including overcollateralized credit pools, AAA-rated collateralized loan obligations, and total bond market ETFs sourced from asset managers collectively overseeing more than $10T in assets. Asset managers on the platform include Apollo, WisdomTree, Hamilton Lane, and BlackRock. Funding comes from ether.fi’s existing liquidity providers and managed reserves from its liquid vaults, meaning no new capital needed to be raised.
Read the full article by The Block here
Moomoo expands into prediction markets through Kalshi partnership
Retail trading platform Moomoo has partnered with Kalshi to bring CFTC-regulated event contracts directly into its app. The integration gives eligible users access to contracts tied to major economic, political, and cultural events including Federal Reserve decisions, and major global sporting events such as the 2026 World Cup. Contracts are exchange-listed derivatives priced between $0.01 and $1.00, fully collateralized, and accessible alongside existing products like stocks, ETFs, and options within the same platform interface. Moomoo recently also expanded its crypto offering to over 50 digital assets with zero commissions and launched moomoo API Skills to support AI-powered investing tools.
Read the full article by CoinDesk here
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Disclaimer:
The content covered in this newsletter is not to be considered investment or financial advice. It is for informational and educational purposes only. The views and opinions expressed in this publication do not reflect those of AP Collective.