Ethereum’s Smart Wallet Chaos: Why Crypto’s ’Safe Mode’ Triggered a Market Freakout

When Ethereum’s smart wallets suddenly flipped into panic mode this week, it wasn’t just devs sweating—billions in DeFi positions hung in the balance. Here’s what really happened behind the code curtain.

The Backdoor Nobody Wanted: A protocol-level safeguard designed to protect users from hacks instead triggered mass liquidations. Irony tastes bitter when it’s served with a 20% ETH price drop.

VCs vs. The Little Guy: Guess who exited positions before the cascade? The same ’smart money’ that built these ticking time bombs. Retail investors? Left holding the algorithmic bag—as usual.

This isn’t innovation. It’s a stress test nobody signed up for. And Wall Street wonders why Main Street still thinks crypto is a casino with extra steps.

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