Hey there, PoI readers! 💫

It's your favorite crypto connoisseur, Mochi, back with another serving of tantalizing tech and web3 news. From Coinbase's CEO battling Wall Street titans at Davos and CZ defending Binance against $19B liquidation accusations to Europe's crypto tax crackdown and billion-dollar robot brains struggling to fold laundry, we've got a lot to unpack. So, buckle up and get ready for a wild ride through the wonderland of digital assets and cutting-edge tech!

INTEL BRIEF

🟧 Coinbase CEO Brian Armstrong allegedly got into a heated confrontation with JPMorgan's Jamie Dimon at Davos over claims that banks are sabotaging US crypto legislation.

🟧 Former Binance CEO CZ dismissed accusations that the exchange caused October's massive $19 billion crypto liquidation event, calling the claims "far-fetched."

🟧 The European Commission is formally calling out 12 EU countries for failing to implement crypto tax reporting rules, while also scolding Hungary for breaking MiCA compliance.

🟧 Physical Intelligence, a San Francisco startup valued at $5.6 billion, is building general-purpose AI for robots without a commercialization timeline, raising over $1 billion to focus purely on research.

Coinbase CEO Gets Roasted by Banking Giants at Davos Over Crypto Bill Drama

Picture this: you're the CEO of Coinbase, casually sipping coffee with a former UK Prime Minister at the fanciest economic summit in the world, when suddenly Jamie Dimon swoops in like a Wall Street vigilante to tell you you're "full of s—."

Yeah, that reportedly happened.

According to The Wall Street Journal, JPMorgan Chase CEO Jamie Dimon confronted Brian Armstrong at the World Economic Forum in Davos last week, and let's just say it wasn't to exchange pleasantries about the Swiss Alps. Dimon was apparently fed up with Armstrong's TV appearances where the Coinbase boss accused banks of trying to sabotage the digital asset market structure bill currently under consideration in Congress.

The drama centers around stablecoin rewards—a feature that banking industry advocates want completely eliminated from the legislation. Armstrong and other crypto advocates are pushing hard to keep stablecoin yield provisions in the bill, arguing that removing them would essentially let "banks ban their competition." Talk about a turf war!

But wait, it gets better (or worse, depending on whose side you're on). Armstrong didn't just get the cold shoulder from Dimon. Bank of America CEO Brian Moynihan reportedly told him, "if you want to be a bank, just be a bank," while Wells Fargo CEO Charlie Scharf straight-up refused to discuss the matter at all. Ouch.

The market structure bill itself is stuck in legislative limbo after passing the House back in July. The Senate Banking Committee was supposed to hold a markup on January 15, but postponed indefinitely after Armstrong announced Coinbase couldn't support the legislation "as written." Meanwhile, the Senate Agriculture Committee voted to advance its version along party lines on Thursday, though it'll need to be combined with the banking committee's version before any Senate vote can happen.

Coinbase's chief policy officer Faryar Shirzad tried to smooth things over, calling the rewards fight "really an anomaly" in their otherwise collaborative relationship with banks. Sure, Jan.

Jamie Dimon reportedly confronted Brian Armstrong at Davos, calling him out for accusing banks of sabotaging crypto legislation

The beef is about stablecoin rewards—banks want them out of the US market structure bill, while Coinbase wants them in

The bill is stuck in Senate limbo after Coinbase withdrew support, with markups postponed indefinitely

CZ Fires Back at Claims That Binance Triggered October's Massive Liquidation Event

Changpeng "CZ" Zhao came out swinging this week, rejecting claims that Binance had anything to do with the historic $19 billion liquidation event that rocked crypto markets back in October. During a Q&A session on Binance's social channels, CZ called the allegations "far-fetched" and made it crystal clear he's not about to compensate anyone for their losses.

"There are a larger group who claim the October 10th crash was caused by Binance and wants Binance to compensate everything," CZ said, basically telling critics to take a hike.

Now, let's be clear about CZ's current status: he's no longer running Binance. The man stepped down as CEO back in November 2023 after pleading guilty to federal charges related to anti-money laundering violations. He even served time in prison before being pardoned by President Donald Trump last October. So when CZ speaks now, he's doing it as a shareholder and user—not as the big boss. These days, he's busy overseeing YZi Labs, an investment company managing about $10 billion in assets.

But here's where things get spicy: Binance was at the center of some serious drama during that October crash. Ethena's USDe stablecoin briefly depegged to $0.65 on the exchange—that's a 35% nosedive for something that's supposed to stay at $1. Ethena Labs founder Guy Young later explained that the price dislocation was caused by a platform-specific internal oracle issue isolated to Binance, which was also experiencing deposit and withdrawal problems that prevented market makers from fixing the arbitrage.

To Binance's credit, the exchange did compensate affected users about $283 million after the incident. That's not exactly pocket change, but it's also not the billions some folks are demanding.

The aftermath? Crypto prices are still struggling to recover. Bitcoin, which was flexing above $126,000 in early October, briefly crashed below $80,000 in November. The broader market lost over $1 trillion in total market cap from those early October highs. Yikes.

CZ denied Binance caused October's $19B liquidation event, calling accusations "far-fetched" during a social media Q&A

USDe stablecoin briefly depegged to $0.65 on Binance during the crash due to an internal oracle issue; the exchange compensated users $283 million

Crypto markets lost over $1 trillion in market cap since early October and are still struggling to recover

European Commission Sends Formal Warnings to 12 Countries Over Crypto Tax Failures

The European Commission just dropped its January infringements package like a disappointed teacher handing out detention slips, and it's not pretty. Belgium, Bulgaria, Czechia, Estonia, Greece, Spain, Cyprus, Luxembourg, Malta, the Netherlands, Poland, and Portugal are all getting formal notices for failing to fully implement the EU's tax transparency and information exchange rules for crypto assets.

That's right—12 countries out of 27 EU member states couldn't get their act together. That's nearly half the class!

The commission is giving these nations two months to respond and fix their mess, or things could escalate to a "reasoned opinion"—which is basically bureaucratic speak for "we're getting really annoyed now." The directive in question requires crypto asset service providers to report certain user and transaction data to help tackle tax fraud, tax evasion, and tax avoidance. It's all part of aligning with the Organization for Economic Cooperation and Development (OECD)'s crypto framework, because apparently everyone wants a piece of that sweet, sweet crypto tax data.

But wait, there's more! Hungary got its own special letter of formal notice for failing to comply with the EU's MiCA framework. Apparently, some crypto service providers have suspended or discontinued services under an amendment to Hungarian law concerning "exchange validation services." The European Commission wasn't having it, stating that while Hungary's intentions to strengthen anti-money laundering safeguards are admirable, the measures must still be compatible with MiCA. You can't just go rogue, Hungary!

For context, the MiCA (Markets in Crypto Assets) framework passed back in 2023 and has been rolling out in stages to give companies time to comply. Most crypto companies that were operating before December 2024 have until July 1 at the latest to meet all MiCA requirements or pack up and leave—though some member states decided to be overachievers and shortened that window.

12 EU countries received formal notices for failing to implement crypto tax reporting rules, with two months to comply or face further action

Hungary got singled out for breaking MiCA compliance with an amendment to local law affecting crypto service providers

MiCA's July 1 deadline is looming for most crypto companies to comply or cease operations in the EU

Physical Intelligence Raises Over $1 Billion to Teach Robots Basic Household Tasks

Welcome to Physical Intelligence's headquarters, where robots struggle with laundry and investors throw billions of dollars at the problem without asking when they'll see a return. If that sounds insane, well, buckle up—it gets weirder.

The San Francisco-based startup's office looks less like a sleek tech headquarters and more like a concrete box filled with robot arms attempting household tasks with varying degrees of success. One arm is trying to fold black pants (it's failing). Another is determined to turn a shirt inside out (not happening today). A third has apparently mastered peeling zucchini and is the office overachiever. There's even a sophisticated espresso machine—not for the staff, mind you, but for the robots to learn how to use. Any lattes they foam are data, not perks.

Co-founder Sergey Levine, a UC Berkeley professor, describes Physical Intelligence as "ChatGPT, but for robots." The company is building general-purpose robotic foundation models that can theoretically handle any task on any robot platform. The idea? Train robots on diverse data from warehouses, homes, and test kitchens so they can generalize across different environments and challenges. Today's zucchini-peeler should theoretically handle an apple or potato tomorrow without starting from scratch.

The hardware itself is deliberately cheap—about $3,500 per arm with markup, or under $1,000 if manufactured in-house. As Levine points out, good intelligence compensates for bad hardware. A few years ago, roboticists would've been shocked these cheap arms could do anything at all.

Enter Lachy Groom, the 31-year-old Australian wunderkind who sold his first company at age 13 (hence the Vegemite jars scattered around). After leaving Stripe as an early employee and spending five years angel investing in hits like Figma, Notion, and Ramp, Groom found what he was looking for in Physical Intelligence. The two-year-old company has raised over $1 billion and is valued at $5.6 billion by backers including Khosla Ventures, Sequoia Capital, and Thrive Capital.

Here's the kicker: Groom doesn't give investors a commercialization timeline. "I don't give investors answers on commercialization," he admits. "That's sort of a weird thing, that people tolerate that." But tolerate it they do, betting that pure research will eventually produce superior general intelligence.

The company isn't alone in this race. Skild AI, a Pittsburgh-based competitor, just raised $1.4 billion at a $14 billion valuation and is taking the opposite approach. While Physical Intelligence focuses on research, Skild AI has already deployed commercially, claiming $30 million in revenue in just a few months across security, warehouses, and manufacturing. Skild has even taken public shots at competitors, arguing most "robotics foundation models" lack "true physical common sense."

It's a philosophical divide: Skild bets commercial deployment creates a data flywheel, while Physical Intelligence bets resisting near-term commercialization enables superior intelligence. Who's right? Years away from knowing.

With about 80 employees and plans to grow "as slowly as possible," Physical Intelligence operates with what Groom calls "unusual clarity." They had a 5-10 year roadmap; by month 18, they'd blown through it. The biggest challenge? Hardware is hard. Everything breaks, arrives slowly, and complicates safety considerations.

Meanwhile, the pants remain unfolded, the shirt stubbornly right-side-out, and the zucchini shavings pile up nicely..

Physical Intelligence raised over $1 billion to build general-purpose AI for robots, valued at $5.6 billion, without giving investors a commercialization timeline

The company uses cheap hardware ($3,500 arms) and focuses on pure research, believing good intelligence compensates for bad hardware

Competitor Skild AI raised $1.4 billion at $14B valuation and is already generating revenue, creating a philosophical divide in the robotics AI race

And that's a wrap, my lovely PoI readers! 🎯 I hope this edition left you feeling informed, entertained, and maybe even a little bit wiser about CEOs throwing shade in Switzerland, regulatory drama across the pond, and why Silicon Valley is betting billions on robots that can't fold pants yet. Remember to stay curious, stay informed, and keep spreading the love. Until next time, this is Mochi, signing off with a virtual high-five!

P.S. Don't forget to share your thoughts, questions, and favorite crypto puns with us. very voice matters in the PoI community! 📣❤️ Share the newsletter

🍨📰 Catch you in the next issue! 📰🍨