The lights in the secure meeting room of the Bank for International Settlements in Basel were dim, the ambiance deliberately austere. Lionel Steenberg sat at the head of the polished oak conference table, fingers steepled, his usual air of ironic detachment momentarily subdued. He surveyed the gathered officials—representatives from financial oversight bodies, cybersecurity firms, and discreet operators within regulatory enforcement.

He sighed theatrically. “Ladies and gentlemen, the time for amusement is over. The Pegged system is no longer an intellectual curiosity; it has become an operational threat.”

A murmur ran through the room.

Steenberg continued, “Alias and his team have designed something dangerously elegant. It is a synthetic stablecoin, a self-reinforcing liquidity machine powered by lotteries. Unlike Bitcoin, which we captured through regulatory integration and institutional custody, this... this is a launch-and-forget system. There is no central figure to squeeze, no CEO to subpoena. It’s an organism, not a corporation.” He let the words sink in.

A man from the European Central Bank adjusted his tie. “What’s our approach?”

Steenberg leaned forward. “We initiate Operation Disrupt. This is not outright war—yet. First, we shake confidence, introduce noise into the system. If we move too aggressively, Pegged’s decentralized structure will make it slip through the cracks. We must dissuade adoption before it metastasizes.”

He tapped the table, cueing a slide deck. The screen flickered to life.

Phase 1: Smear Campaign

“We need to paint Pegged as what it fundamentally is—a dangerous experiment with no accountability. Media assets will begin associating it with black-market transactions, terrorist financing, money laundering. We plant doubt. The message? ‘It’s an untested, high-risk system designed by a paranoid idealist with a god complex.’”

An older man from the Office of Foreign Assets Control (OFAC) chuckled. “Ah, the classics.”

Steenberg nodded. “Next…”

Phase 2: Cyber Infiltration and Liquidity Attacks

“Alias may be brilliant, but he’s not infallible. We have teams working on vulnerabilities in Pegged’s on-chain infrastructure. Small, targeted disruptions—nothing too obvious. Latency issues in transactions, liquidity drain simulations, selective frontrunning attacks on lottery pay-outs. If we can break its perceived stability, users will hesitate.”

The cybersecurity specialist in the room spoke up. “Are we certain about the attack vectors? If their governance coin PDAO kicks in—”

Steenberg interrupted. “Yes, yes. Their DAO is supposed to self-correct, but let’s be honest—most DAOs are clumsy, slow-moving bureaucracies disguised as technology. By the time they respond, confidence will already be shaken.”

Phase 3: Regulatory Squeeze

“This is where we bring in the full force of financial oversight. Pegged operates outside the banking system? Fine. We choke the onramps and offramps. Exchanges will be warned—any facilitation of $PEG transactions risks non-compliance with financial transparency laws. Payment processors will be reminded of their obligations.”

A representative from the Securities and Exchange Commission (SEC) scribbled notes. “And if they resist?”

Steenberg smiled. “They won’t. No exchange wants to end up like Binance.”

Laughter rippled through the room.

Phase 4: Disrupt Distribution

“This system relies on grassroots adoption. Manteros in Spain, street-level vendors, informal economies. We make sure they feel the risk.” He turned to a man from Interpol. “We need targeted enforcement—visible, public crackdowns on any merchant using $PEG. Make examples.”

The Interpol officer nodded. “You want arrests?”

“Not necessarily. Just make life inconvenient for them. Seize phones, question vendors, detain without charging. The fear will do the rest.”

A long pause followed.

The official from the International Monetary Fund leaned back. “And if this doesn’t work?”

Steenberg tapped his pen against the table, his voice almost playful. “Then we move to Operation Chokepoint 3.0. That, my friends, is when we stop playing chess and start kicking the board over.”

He stood, straightening his jacket. “We begin immediately. Keep it clean. Keep it subtle. And for God’s sake, make sure Alias never sees it coming.”

The room emptied, but Steenberg lingered for a moment, looking out at the dark Swiss sky. He muttered to himself, half-smiling.

“They always believe they can outpace the tide.”