The New Value Cycle of DOGE: Political Flow Potential and Musk's 'Department of Government Efficiency' (D.O.G.E) Political Career

We know the saying, "Buy the rumor, sell the news." Before the October elections, the article I published, “The New Value Cycle of DOGE: Political Flow Potential and Musk's 'Department of Government Efficiency' (D.O.G.E) Political Career”, received a good response and met expectations

With the upcoming presidential transition and the potential resignation of SEC Chairman Gary Gensler, market speculation has shifted toward cryptocurrency. In this article, we'll explore the cryptocurrency that stands to benefit directly as expectations for an improved regulatory environment rise.

Last week, a noteworthy phenomenon emerged: Gary Gensler's potential resignation from his position as SEC Chairman has sparked market speculation on the rumor of his departure. Most mainstream media outlets have covered this development, highlighting potential successors and discussing the implications for the cryptocurrency industry.

In this article, we'll analyze which cryptocurrency will benefit the most directly as expectations for an improved regulatory environment increase. To conclude, I believe the ETH Staking sector will be the one to benefit the most directly, and Lido, as the leading project, may also escape its current price predicament.

Review of Lido's Regulatory Dilemma: Samuels v. Lido DAO Lawsuit

First, let's provide some basic information. We know that Lido is the leading project in the ETH Staking sector, offering non-custodial technical services to help users participate in Ethereum PoS and earn returns, while lowering the technical threshold and the funding threshold of 32 ETH for Ethereum Native Staking. The project has raised a total of $170 million through three rounds of funding. After its launch in 2022, Lido maintained a market share of around 30% due to its first-mover advantage. As of now, according to Dune's data, Lido still holds a 27% market share, with no significant decline, indicating strong business demand for Lido.

The reason for Lido's current price slump can be traced back to the end of 2023, when its governance token LDO reached an all-time high, with a market cap of $4 billion. At that time, a lawsuit changed the entire price trend: the Samuels v. Lido DAO case, case number 3:23-cv-06492.

On December 17, 2023, an individual named Andrew Samuels filed a lawsuit against Lido DAO in the U.S. District Court for the Northern District of California, accusing the defendant Lido DAO and its partnered venture capital firms of selling LDO tokens to the public without registration, violating the Securities Act of 1933. Additionally, Lido DAO created a highly profitable business model by pooling users' Ethereum assets for staking but failed to register its LDO tokens with the SEC as required. The plaintiff Andrew Samuels and other investors, who purchased LDO tokens believing in the potential of this business model, ultimately suffered financial losses, and thus they sought legal compensation.

This case not only involves Lido DAO but also includes accusations against its major investors, such as AH Capital Management LLC, Dragonfly Digital Management LLC, Lido DAO, Paradigm Operations LP, and Robot Ventures LP. According to information on the case's progress, these institutions received subpoenas from the court in January 2024, when LDO's price was at its peak. After that, the legal process was limited to the lawyers of the investment institutions and Andrew Samuels, so the related influence did not spread.

It wasn't until the first motion hearing on March 28, 2024, that the ruling was confirmed on April 10, 2024, and after modifying some relevant terms, the case was factually accepted.

Subsequently, on May 28, 2024, Andrew Samuels' legal team unilaterally announced a motion for a default judgment against Lido DAO. The reason for this action was that Lido DAO believed it was not operating as a company and thus ignored the lawsuit. If ultimately declared in default, it would expose Lido to unfavorable judgments, such as not being able to defend itself, and based on previous similar cases like Ooki DAO, the results for the absent party are generally unfavorable. This motion was approved by the court on June 27, requiring Lido DAO to respond within 14 days. Consequently, Lido DAO had to propose a community proposal on July 2, 2024, to hire Dolphin CL, LLC, based in Nevada, as its defense attorney and requested a budget of 200,000 DAI. At this point, the case became widely known in the community. After several rebuttals from both sides, the case seemed to enter a cooling-off period after September.

Meanwhile, another case had a substantial impact on Lido: the SEC's lawsuit against Consensys Software Inc. on June 28, 2024, case number 24-civ-04578. Note that this date is just one day after the ruling in the Lido case, where Lido DAO was fully informed of the lawsuit's judgment. In this lawsuit, the SEC alleged that Consensys Software Inc. engaged in unregistered securities issuance and sales through its service called MetaMask Staking, and operated