Hey there, PoI readers! 💫

It's your favorite crypto connoisseur, Mochi, back with another serving of tantalizing tech and web3 news. From Coinbase dusting off a 30-year-old internet relic and CZ dodging bank-founding accusations to Balancer's $70M vanishing act and Google's AI getting a timeout for defamation, we've got a lot to unpack. So, buckle up and get ready for a wild ride through the wonderland of digital assets!

INTEL BRIEF

🟧 Coinbase's x402 protocol resurrects a 30-year-old internet payment code to let AI agents pay for services instantly using USDC, with PING becoming the breakout star token.

🟧 Kyrgyzstan's president claims CZ proposed a crypto private bank, but the former Binance CEO says "nah, that wasn't me" while confirming he's still advising the country on blockchain.

🟧 Balancer allegedly got drained for around $70 million in staked Ether tokens that mysteriously walked themselves into a fresh wallet, because apparently DeFi security is still playing on hard mode.

🟧 Google yanked its Gemma AI model from AI Studio after Senator Marsha Blackburn accused it of fabricating wild sexual misconduct allegations that never happened—complete with fake news links.

AI Agents Get Their Own Lightning Fast Payment System Thanks to a Forgotten 1990s Internet Code

Coinbase just proved her wrong by dusting off HTTP 402—a payment code that's been collecting cobwebs since the '90s—and turning it into the hottest AI agent payment rail in town.

Here's the deal: Back when Tim Berners-Lee and his crew were busy inventing the internet (you know, casual world-changing stuff), they baked HTTP 402 into the system as a "Payment Required" status code. The vision? Servers could ask for money before handing over content. But without the right tech, it just sat there for three decades like that gym membership you swore you'd use.

Enter x402. Coinbase activated this sleeping giant and suddenly AI agents can pay for APIs, data, and computing power without filling out forms, storing credit cards, or waiting for some human to approve their expense report. The whole transaction happens in about 2 seconds on Base, costs less than $0.0001 in gas fees, and settles in USDC with zero chargebacks. It's basically the fast-food drive-thru of blockchain payments, except your AI agent is the one ordering.

The protocol works beautifully simple: Your AI agent pings a service, gets a 402 response with a price tag, signs the payment, and boom—access granted. A facilitator (like PayAI, which handles over 14% of x402 traffic) verifies everything and settles it onchain. No subscription drama, no API key headaches, just pure pay-per-use efficiency.

And the heavyweight backing? Google integrated it, Cloudflare co-founded the x402 Foundation with Coinbase, and Visa jumped in too. When the big dogs start playing fetch with your protocol, you know you're onto something.

x402 revives a 1990s HTTP payment code to enable instant AI agent transactions on Base for under $0.0001

Transactions settle in ~2 seconds using USDC with no chargebacks, perfect for autonomous AI operations

Major players like Google, Visa, and Cloudflare have integrated or supported the protocol, pushing ecosystem market cap past $800M

Kyrgyzstan President Says CZ Pitched a Crypto Bank But the Binance Founder Says That Never Happened

Kyrgyzstan President Sadyr Japarov told the Kabar news agency that Changpeng "CZ" Zhao visited the country in May and pitched the idea of establishing a private bank that deals in cryptocurrency. According to Japarov, he initially wanted a state-owned bank, but when CZ supposedly rejected that idea, they "agreed to open a private bank" instead—resulting in Bereket Bank.

Plot twist: CZ says this is news to him too.

The former Binance CEO quickly hopped on X (formerly Twitter, for those still mourning the bird) to set the record straight. "This isn't correct," CZ wrote, adding that he never proposed creating a bank and has zero interest in running one. "I don't recognize the name mentioned below. It's not something I proposed." He speculated he might have casually mentioned wishing for more digital banks supporting crypto generally, but that's a far cry from actually founding one.

Now, before you think CZ is totally disconnected from Kyrgyzstan—he's not. The crypto mogul revealed back in April that he's been advising the Central Asian nation on blockchain regulation and tech after signing a memorandum with their foreign investment agency. Since then, he's been neck-deep in Kyrgyzstan's crypto initiatives, including a som-pegged stablecoin on BNB Chain launched in October, integrating Binance Academy with 10 universities, and localizing the Binance app across the country.

So yeah, CZ's involved—just maybe not in the way the president thinks. It's giving "lost in translation" vibes, except the translation is between crypto advisor and bank founder. Big difference.

Kyrgyzstan's president claimed CZ proposed a crypto private bank called Bereket Bank after visiting in May

CZ denied the claims, stating he never proposed creating a bank and has no interest in running one

CZ is still advising Kyrgyzstan on blockchain/crypto, helping launch a som-pegged stablecoin and Binance Academy integrations

Someone Just Drained $70 Million Worth of Staked Ethereum From Balancer Into a Freshly Made Wallet

Balancer might've just joined the "got rekt" club with what appears to be a $70 million exploit. Nothing screams Monday like watching millions in staked Ether casually stroll into a brand-new wallet like it owns the place.

According to onchain sleuths and Etherscan logs, the decentralized exchange and automated market maker saw $70.9 million worth of liquid staked Ether tokens transferred across three transactions to a suspiciously fresh wallet. We're talking 6,850 StakeWise Staked ETH (OSETH), 6,590 Wrapped Ether (WETH), and 4,260 Lido wstETH (wSTETH)—basically, the entire buffet of staked assets.

Crypto intelligence platform Nansen flagged the movement, and blockchain security firm Cyvers estimated the damage could be even spicier at up to $84 million when accounting for suspicious transactions across multiple chains. Balancer hasn't officially confirmed the exploit yet, but when that much crypto ghosts into a wallet that was born yesterday, it's probably not a voluntary donation.

This isn't Balancer's first rodeo with security headaches, either. Back in September 2022, the protocol got hit with a DNS attack that redirected users to a phishing site, resulting in about $238,000 in stolen funds. Then in August 2023, hackers swiped almost $1 million in a stalecoin exploit just a week after Balancer disclosed a "critical vulnerability" in some liquidity pools. And let's not forget the June 2020 flash loan attack that drained $500,000 worth of ETH and tokens.

At this point, Balancer's security track record is looking like a crypto horror anthology. The DeFi community is watching closely to see if the protocol can recover the funds or if this becomes another cautionary tale about smart contract vulnerabilities.

Balancer reportedly lost $70M+ in staked ETH tokens transferred to a new wallet in three suspicious transactions

Blockchain security firm Cyvers estimates up to $84M in suspicious activity across multiple chains related to the incident

This marks Balancer's fourth major security incident since 2020, including DNS attacks, exploits, and flash loan hacks

Senator Blackburn Forces Google to Remove Gemma AI After It Fabricated Sexual Misconduct Claims About Her

Google learned this lesson the hard way after Senator Marsha Blackburn accused Gemma of straight-up defamation.

In a spicy letter to Google CEO Sundar Pichai, the Tennessee Republican revealed that when Gemma was asked if she'd been accused of rape, the AI model fabricated an entire story about a 1987 state senate campaign (wrong year—it was actually 1998) involving a state trooper, prescription drugs, and "non-consensual acts." The kicker? None of it is true. Not the trooper, not the allegations, not even the supposed news articles—those links led to error pages and unrelated content.

"This is not a harmless 'hallucination,'" Blackburn wrote, calling it straight-up defamation. She also referenced conservative activist Robby Starbuck's lawsuit against Google, where he claims Gemma generated similarly horrific false accusations, including labeling him a "child rapist" and "serial sexual abuser."

When Blackburn brought this up during a Senate Commerce hearing, Google's VP Markham Erickson reportedly said hallucinations are a "known issue" they're working to fix. But Blackburn wasn't buying the "oopsie, our bad" defense, arguing there's "a consistent pattern of bias against conservative figures" in Google's AI systems—a complaint that echoes broader concerns about "AI censorship" from Trump administration supporters.

In response, Google pulled Gemma from AI Studio late Friday, clarifying that Gemma was never intended as a consumer tool and that non-developers were misusing it for factual questions. The model remains available via API for developers, but the public playground? Closed for renovations.

Senator Blackburn accused Google's Gemma AI of fabricating false sexual misconduct allegations against her with fake news links

Google removed Gemma from AI Studio, stating it was never meant for consumer use or factual queries

This follows similar defamation claims from conservative activist Robby Starbuck, fueling accusations of bias in Google's AI systems

And that's a wrap, my lovely PoI readers! I hope this edition left you feeling informed, entertained, and maybe even a little bit richer (in knowledge, of course). From AI agents getting their own payment rails to AI models getting grounded for making stuff up, the crypto and tech world never fails to deliver the drama.

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! 📰🍨