Over the course of the next one month, we’ll be exploring the crypto regulation landscapes across different jurisdictions — the United States, the European Union, Kenya, Nigeria and South Korea!🔥✨

This week, we’re off to a great start with an overview of the state of crypto policy in the United States, so let’s get right into it.

For most of the last decade, the United States regulated digital assets through a patchwork of old statutes, agency speeches, and lawsuits filed after products reached the market. This model produced familiar headlines securities complaints, emergency injunctions, and large settlements, but little advance notice for a business deciding whether a token, protocol, or stablecoin could lawfully operate.

By 2025, however, the American crypto story opened a new chapter, which has allowed room for some much-needed clarity. Congress enacted the GENIUS Act on July 18, 2025, giving payment stablecoins their first comprehensive federal statute. Then, on March 17, 2026, the SEC and CFTC issued a joint taxonomy that classified 18 tokens, including Bitcoin and Ether, in non-security categories. While this move has not particularly solved crypto regulation, it has moved from “regulation by enforcement” toward an identifiable framework.

The watershed is therefore best understood as a change in method, not the end of legal risk. The GENIUS Act addresses payment stablecoins; the SEC-CFTC taxonomy supplies an interpretive map; and the Digital Asset Market Clarity Act (the CLARITY Act) is intended to settle the wider market-structure fight. However, CLARITY remains incomplete. It cleared at the House, advanced to the Senate, and then stalled over ethics, DeFi, and stablecoin-yield disputes. Businesses still operate at the intersection of federal, state, tax, sanctions, and consumer-protection rules.

This Issue maps out America’s crypto policy terrain, as things stands at the time of writing, and submits that the practical question for American founders, exchanges, custodians, issuers, and advisers is no longer simply whether the US government is friendly to crypto. It now focuses on which regulator has the primary word, which license is required, which facts determine token classification, and whether the business can prove compliance before a regulator asks.

Federal Agencies — Who Regulates What?

1. The Securities and Exchange Commission (SEC)

The SEC remains the central federal authority where a digital asset or transaction implicates securities law. Under Chair Paul Atkins, however, the Commission has pivoted from case-driven expansion of jurisdiction toward rulemaking and clearer lines. It dismissed major cases against Coinbase and Binance, launched the “Project Crypto” task force, and joined the CFTC in classifying 18 tokens as non-securities.

The SEC’s proposed “Regulation Crypto,” which was scheduled for an August 14, 2026 vote, would have been the SEC’s first formal crypto-specific rulemaking, but the vote was abruptly postponed without a new date, leaving the pivot substantial, but unfinished.

2. The Commodity Futures Trading Commission (CFTC)

The CFTC, under Chair Mike Selig, regulates U.S. derivatives markets, including futures, options, and certain crypto assets classified as commodities, such as Bitcoin and Ethereum. This agency focuses on combatting fraud and market manipulation in interstate trade. It signed a March 11 memorandum of understanding with the SEC and is pursuing a larger role in digital-commodity spot markets, prediction markets, and perpetual contracts.

The CFTC also used emergency powers to defend Kalshi against state lawsuits, making prediction markets the most visible test of federal pre-emption. Its remit remains strongest in derivatives and fraud or manipulation, but the agency is positioning itself as the principal market regulator for qualifying digital commodities.

3. Financial Crimes Enforcement Network (FinCEN)

The FinCEN is the Treasury bureau charged with administering the Bank Secrecy Act (BSA), and remains the operational center of U.S. crypto AML. It registers money-services businesses and expects exchanges, custodians, and other covered businesses to maintain risk-based customer identification, transaction monitoring, suspicious-activity reporting, and recordkeeping.

Under the GENIUS Act, FinCEN is now implementing BSA obligations specifically for payment-stablecoin issuers. A joint AML rule issued with OFAC in April 2026 treats stablecoin issuers as financial institutions, reinforcing that stablecoin compliance is not merely a product-design issue.

4. Internal Revenue Service (IRS)

The IRS is the U.S. federal agency responsible for collecting taxes and enforcing tax laws, and currently treats cryptocurrency as property. Disposals, swaps, payments, rewards, and other taxable events must be reported under the applicable income or capital-gains rules. However, there remains a debate on staking, as to whether tokens are taxed when received or only when sold or otherwise disposed of.

5. Office of the Comptroller of the Currency (OCC)

The OCC has become a decisive gatekeeper for stablecoin infrastructure. In December 2025, it granted conditional national trust-bank charters to Circle, Paxos, Ripple, BitGo, and Fidelity. In August 2026, it approved a conditional charter for World Liberty Financial.

Under the GENIUS Act, the OCC is also now the primary federal regulator for stablecoin issuers within its remit.

6. Federal Trade Commission (FTC)

The FTC, responsible for enforcing consumer protection laws and promoting competition in the marketplace, is further empowered to handled cases of deceptive marketing, consumer fraud, and unfair practices. It also monitors scams and deceptive practices in the cryptocurrency space, such as fraudulent ICOs, Ponzi schemes, impersonation schemes, misleading yield claims, undisclosed influencer promotions, and other crypto-related fraud.

The Federal Regulatory Landscape

Right now, US crypto policy at the federal level is moving on two paths. First, Congress has passed an actual law dealing with stablecoins — the GENIUS Act. Second, federal agencies are using powers they already have to start drawing lines around how crypto markets should work, even without a full law from Congress covering everything.

Think of it this way: there are three big pieces to the puzzle. The GENIUS Act sets the rules for stablecoin issuers. The SEC-CFTC joint classification tells the market which tokens are securities and which are not. And the CLARITY Act, if it ever passes, would settle the bigger question of who regulates what across the entire crypto trading space.

The GENIUS Act

President Trump signed the GENIUS Act on July 18, 2025. In plain terms, it dictates that if you want to issue a payment stablecoin in the United States, you need to be a “Permitted Payment Stablecoin Issuer.” Stablecoins must be backed dollar-for-dollar by approved reserves, mainly short-term US Treasury bills (maturing in 93 days or less). Additionally, stablecoin companies cannot pay interest or yield to people just for holding the stablecoin, their reserve breakdowns must be published monthly, and key team members of the company are required to personally sign off on the accuracy of those reports.

The one-year implementation deadline for the GENIUS Act lapsed on July 18, 2026, and was met when six federal agencies published their proposed rules covering banking requirements, anti-money laundering, and sanctions compliance. The law is set to take full effect on January 18, 2027. So, for stablecoin issuers, this is not theoretical. Compliance obligations are arriving now.

The CLARITY Act

The CLARITY Act was passed at the House of Representatives in July 2025. Its purpose is to clearly split regulatory duties: the SEC would handle securities and token offerings, while the CFTC would oversee digital commodities and most of the spot trading market. It would also create a proper registration system for crypto exchanges, brokers, and dealers, giving these businesses a clear path to compliance instead of forcing them to guess which old-school rules apply to them.

But here’s the problem: the CLARITY Act never made it through the Senate. It got stuck over disagreements about ethics rules; specifically rules aimed at preventing politicians (especially Trump) from profiting personally from crypto. Democrats pulled their support, and the Senate went on its August break without ever holding a vote. As of now, the bill is still seven votes short of passing.

The SEC-CFTC Token Classification

On March 17, 2026, the SEC and CFTC together released a legally binding official classification system for crypto tokens. They sorted tokens into five categories: digital commodities, digital collectibles, utility tokens, stablecoins, and security tokens. They named 18 specific tokens, including Bitcoin and Ethereum, as non-securities.

Why does this matter? Because it completely moves away from what the SEC had argued in several past lawsuits. It gives crypto businesses an actual published reference point for the first time. That said, tokens not on the list still need a case-by-case analysis, and how a token is actually sold can matter more than what it’s called.

A week before that, on March 11, the SEC and CFTC signed a cooperation agreement (an MOU) to share data, coordinate enforcement actions, and carry out joint oversight. The goal is to stop the confusion that happened when companies faced conflicting demands from both agencies at the same time. But the flip side is this: just because you’ve satisfied one agency’s requirements doesn’t mean the other one won’t come knocking.

The SEC scheduled a vote on August 14 to propose “Regulation Crypto”, which would have been its first formal crypto-specific rule. However, it cancelled the meeting at the last minute with no new date announced. Until that proposal is officially published for public comment, crypto businesses still have no formal eligibility test, no disclosure template, and no safe harbor to rely on. The takeaway is straightforward: guidance that’s been announced but not finalized is not the same thing as settled law.

What this means for Crypto builders

If you’re building in this space, the starting point should now be: what does my product actually do? Are you issuing a payment stablecoin? Facilitating a spot trade in a digital commodity? Offering a security token? Running a derivatives or prediction market? Transmitting money for customers? Once you answer that, you can map out which combination of SEC, CFTC, OCC, FinCEN, OFAC, IRS, and consumer protection rules apply to you. A legal memo that only covers “is my token a security?’’ but ignores licensing, AML, and money transmission is incomplete.

The State-Level Arena

Here’s what many people miss: even though the federal government is building a new framework, state laws haven’t gone away. States still control money transmission licensing, consumer protection, gambling regulation, and financial conduct rules. So a token that the federal government has classified as a non-security might still need a state license, might still trigger state disclosure requirements, or might still get you sued by a state attorney general. Federal clarity has reduced one layer of confusion, but it has also made the conflicts between federal and state rules more obvious.

California is the clearest example. Its Digital Financial Assets Law kicked in on July 1, 2026, requiring crypto businesses serving Californians to get a license from the state’s Department of Financial Protection and Innovation. The state also capped crypto ATM deposits and withdrawals at $1,000 per customer per day. And just one day before the law took effect, California passed emergency amendments tweaking the rules as implementation began.

New York continues doing its own thing. The BitLicense regime is still in place. And Attorney General Letitia James has been aggressive, suing Coinbase and Gemini in April 2026 and Kalshi in July 2026, arguing that their prediction market products amount to illegal gambling under state law.

Crypto ATMs have become a hot target. Hawaii banned cash-to-crypto ATM deposits starting October 1, 2026. Indiana, Tennessee, and Minnesota went further and banned crypto ATMs entirely in 2026. Arizona took a different approach, it passed a law that reimburses scam victims who report quickly. The lesson for any company planning a national rollout: you cannot just check the federal box and call it done. The state where your customer lives, what your kiosk does, and how the user’s money moves all determine whether your product is actually legal in that location.

Prediction markets are where federal-state tension is at its sharpest. The CFTC used emergency powers to keep Kalshi operating in New York after the state sued to shut it down, arguing that these are federally regulated financial products, not state-controlled gambling. New York and other states disagree. Until either Congress or the courts settle who wins in this clash, prediction market operators should expect investigations from multiple jurisdictions, constantly changing geographic restrictions, and legal fights over whether a product’s label or its real-world function is what matters.

Wyoming, however, remains the friendly outlier. Its crypto-supportive laws, digital-asset banking framework, and DAO legislation make it attractive for companies wanting a welcoming home base. But there’s a catch: Wyoming’s friendly treatment doesn’t travel with you. If your customers are in California or New York, those states’ rules apply regardless of where you incorporated. This reality moves the conversation from considering which state is the most crypto-friendly, to developing a solid licensing and compliance strategy for all fifty states where your users might be.

Crypto Policy under the Trump Administration

President Trump’s second term has placed crypto at the heart of his economic agenda, with promises to make the US the “crypto capital” of the world. As of August 2026, there seems to be real substance behind that promise. His administration has delivered executive orders, signed legislation, appointed crypto-friendly regulators, created a national Bitcoin reserve, and pushed back against state-level restrictions on the industry. However, these moves have also raised serious ethics questions that could shape the next chapter of crypto lawmaking.

The Executive Order

On January 23, 2025, Trump signed an executive order called “Strengthening American Leadership in Digital Financial Technology.” In simple terms, this Order did five things:

1. Created a President’s Working Group on Digital Asset Markets — a policy coordination team inside the National Economic Council;

2. Banned federal agencies from creating, issuing, or promoting a central bank digital currency (CBDC);

3. Encouraged the growth of dollar-backed stablecoins and a US-based crypto economy;

4. Directed regulators to protect crypto companies’ access to banking services; and

5. Called for clearer, more predictable rules for the entire digital asset industry.

The Order also directed the Working Group, led by David Sacks, to review all existing crypto regulations, recommend what to change or remove, and look into creating a national Bitcoin reserve. It essentially scrapped the Biden administration’s crypto policy playbook.

David Sacks, serving as the Trump administration’s crypto and AI, has been the person keeping all these moving parts aligned politically. The Working Group’s job is to translate the executive order into laws and actionable steps; not to replace the SEC or CFTC.

This importantly reflects the fact that a president can set direction through an executive order, but only Congress can permanently settle questions like which agency regulates which part of the crypto market.

So far, the Trump administration has made two main achievements in crypto policy:

1. The GENIUS Act, which is America’s first-ever federal stablecoin law, is the administration’s signature win; and

2. The Strategic Bitcoin Reserve, created in March 2025, is the other major symbol. The US government now holds Bitcoin as a strategic national asset, rather than treating it only as something to confiscate from criminals.

Together, these two actions signal that the federal government has accepted crypto as part of the financial system. However, important obligations haven’t disappeared, as anti-money laundering rules, tax requirements, sanctions compliance, consumer protections, and market manipulation prohibitions all still apply in full.

Notwithstanding these achievements, the administration still has a major Achilles hill — the World Liberty Financial (WLFI) Problem. This is the administration’s biggest political weak spot.

In August 2026, the OCC approved a conditional national trust bank charter for World Liberty Financial (WLFI), a crypto venture backed by the Trump family, despite loud concerns about conflicts of interest.

Critics, led by Senator Elizabeth Warren, have zeroed in on reports that 75% of WLFI token sale proceeds go to a Trump-controlled company. For anyone in the crypto industry, this isn’t just about politics or bad optics. It raises practical questions: Are all applicants being treated equally? Are the right people recusing themselves from decisions? Are disclosures adequate? And most importantly, could a future Congress come back and undo rules that were adopted while the President was personally making money from crypto?

Implications for Crypto Businesses

The federal government’s shift in approach has changed how the compliance conversation works; but it hasn’t made compliance optional. The era where the SEC’s main crypto strategy was “regulate by suing people” is effectively over at the federal level. The government is now offering real tools: statutes, classification categories, bank charters, proposed rules, and coordinated agency processes. But at the same time, states are ramping up enforcement. And because the CLARITY Act hasn’t passed, the biggest questions — which tokens are securities, who needs to register, which agency has authority — remain legally unsettled.

Here’s what crypto businesses should be doing right now:

1. Get ready for GENIUS Act compliance immediately.

If you deal with stablecoins in any way, ask yourself these questions: Is your product a “payment stablecoin” under the law? Is your issuer on the approved list? Are reserves backed dollar-for-dollar and properly separated from company funds? Are you paying yield (which the law prohibits)? Are monthly reserve disclosures ready to go? Can your CEO and CFO personally certify those reports? If you’re an exchange or wallet, check whether the stablecoin issuers you support will actually be permitted when full enforcement begins on January 18, 2027.

2. Don’t assume the 18-token list means you’re automatically safe.

Yes, Bitcoin, Ethereum, and 16 other tokens have been officially classified as non-securities; but that doesn’t mean every token gets a free pass. There is a need to document why each specific token fits into one of the approved categories; to distinguish between someone trading the token on the open market and the original fundraising that created it. Each project would need to keep records showing why its token qualifies as sufficiently decentralized or utility-based. If the CLARITY Act stays stuck in Congress, this classification system will guide regulators and lawyers; but it won’t give every issuer the bulletproof legal certainty the market is hoping for.

3. Figure out state-by-state obligations before you launch.

California licensing is now mandatory for covered crypto businesses. New York still requires BitLicense analysis for anyone operating there. Crypto ATM restrictions and prediction market bans are popping up in more states every month. A product that’s perfectly legal under federal rules might still need a state money-transmission license, specific consumer disclosures, a gambling law review, geographic blocking technology, or a scam-reimbursement plan, depending entirely on where your users live.

4. Treat corporate governance as a compliance requirement.

For crypto companies, ow you classified your tokens, how reserves were approved, what risks were accepted, communications with regulators, political donation reviews, conflict-of-interest checks. The WLFI controversy is proof of how quickly questions about who owns and influences a crypto project can turn into questions about whether that project is allowed to operate. If Democrats take control of Congress in the November 2026 midterms, expect conflict-of-interest concerns to move right back to the center of crypto policy discussions.

Conclusion

The United States is at an inflection point. Two pillars are now standing: the GENIUS Act supplies a federal foundation for payment stablecoins, and the SEC-CFTC taxonomy supplies the clearest official map yet for token categories. The third pillar, CLARITY’s market-structure settlement, remains inconclusive. Until it is enacted, the United States will have a framework for some of the market and an argument over the rest.

The message, for crypto startups in the US, is practical. Build with actual, existing rules in mind; assume that state obligations survive federal clarity; and keep systems flexible enough to absorb a new statute, court decision, or a change in congressional decisions. The American crypto market is no longer waiting for regulation to begin. It is learning how to operate while the frameworks are still being developed.

On today’s CRR, we cover:

⚖️Regulatory Frameworks: Nigeria’s NRS releasing its first virtual assets tax guidelines, South Africa’s draft guidelines for cross-border crypto payments, Kenya’s VASP regulations giving rise to warnings of market isolation, the US SEC’s Reg Crypto proposal and abrupt cancellation, the CFTC moving to regulate crypto without the CLARITY Act, Hawaii’s crypto ATM ban, and Ireland’s new AML proposals.

⚖️Crypto Holdings & Acquisitions: Tether’s landmark KPMG audit and the World Liberty Financial’s conditional bank charter approval.

⚖️Criminal Matters: Court charges levied against three Missouri men reportedly involved in crypto robbery scheme, indictment of an NFT startup founder for securities and wire fraud, Delio CEO’s 15-year prison sentence in South Korea, and Australia suspending Cryptolink’s 96 ATMs.

⚖️ Lawsuits & Court Rulings: The CFTC’s emergency order keeping Kalshi open in New York, the Custodia Bank Supreme Court case, and NYC’s probe into prediction market marketing.

⚖️ Mood of Market: Bitcoin consolidating near $63,000, mixed ETF flows, the Fear & Greed index at 30, and the compounding regulatory uncertainty from multiple delayed rulemaking efforts.

Let’s get right into it!

Development in Regulatory Frameworks

Nigeria Revenue Service releases first virtual assets tax guidelines

The Nigeria Revenue Service (NRS) on August 3, 2026 published its Guidelines on the Taxation of Virtual Assets — its first standardized administrative framework for taxing crypto transactions — grounded in the Nigeria Tax Act 2025, the Nigeria Tax Administration Act 2025, and the recently signed Presidential Virtual Assets Coordination Order 2026.

The Guidelines apply to anyone who acquires, disposes of, or exchanges virtual assets, receives income in virtual assets, operates as a VASP or P2P marketplace, or otherwise derives Nigerian-taxable income from the virtual asset space. Virtual assets, under the Guidelines, are classified into six categories: cryptocurrencies/exchange tokens, stablecoins, security/investment tokens, utility/governance tokens, NFTs, and sovereign digital currencies (such as the eNaira); each of which carry different tax consequences. Notably, CBDCs like the eNaira are treated exactly like fiat currency and fall outside the virtual asset tax regime entirely.

A single virtual asset transaction can attract multiple tax liabilities simultaneously: income tax, VAT at 7.5% on related services (brokerage, custodial, advisory, and exchange services — though not on the asset transfer itself), and stamp duty may all apply at once. Non-resident VASPs serving Nigerian users would also be required to register and account for VAT or have the Nigerian recipient self-charge it.

The Guidelines arrive few weeks after President Tinubu’s executive order establishing a Virtual Asset Council to harmonize crypto oversight, and as Nigeria navigates the tension between fostering its $59 billion crypto inflow market, as highlighted in a June 2026 International Monetary Fund (IMF) report, and generating tax revenue from it.

Kenya publishes VASP regulations; warnings of market isolation arise

Kenya’s published Virtual Asset Service Providers (VASP) regulations now grant the Central Bank of Kenya (CBK) significant autonomy over digital currency transactions, including the authority to direct licensed intermediaries to restrict access on foreign-issued stablecoins such as USDT and USDC.

Stablecoins must now be approved by the CBK and issued by a licensed stablecoin issuer before they can be listed on regulated local exchanges.

South Africa releases draft guidelines for cross-border crypto payments

On August 3, South Africa released draft guidelines for cross-border cryptocurrency payments, expanding oversight as the continent’s early leader in crypto regulation. South Africa has regulated crypto assets as financial products under ITS Financial Sector Conduct Authority (FSCA) since June 2023, requiring Crypto Asset Service Providers to obtain licenses and comply with the FATF Travel Rule. The country’s Intergovernmental Fintech Working Group continues to explore additional regulatory approaches to stablecoins and tokenization.

US SEC proposes Reg Crypto, abruptly cancels the vote

The U.S. Securities and Exchange Commission scheduled an August 14 open meeting to propose “Regulation Crypto”, its first formal rulemaking designed to create a tailored offering regime for certain digital asset investment contracts. The proposal was expected to give crypto firms a regimented path to legally issue tokens without triggering full SEC registration requirements, along with an exit path for getting clear of the agency’s jurisdiction when issuers are no longer engaged in hands-on project management.

However, the SEC abruptly cancelled the meeting without setting a new date, postponing the landmark rule indefinitely. The cancellation also delayed the agency’s long-awaited “innovation exemption” for tokenized securities, which SEC Chairman Paul Atkins had championed since late 2025 reportedly due to concerns from both Wall Street firms and the White House over the exemption’s scope. TD Cowen analyst Jaret Seiberg characterized “Reg Crypto” as “the first of several rulemakings the SEC will undertake to provide regulatory certainty for crypto assets after the Senate failed before the August recess to advance the Clarity Act”.

US CFTC announces it will explore crypto regulations without the CLARITY Act

With the US Senate departing for August recess without holding even a procedural vote on the CLARITY Act, the CFTC has announced that it would join the SEC in exploring crypto regulatory frameworks independently of legislation. The move underscores the agencies’ willingness to use existing authority to provide market clarity even as the market structure bill — seven votes short of Senate passage — faces an uncertain path. Reportedly, some industry players have described the Clarity Act’s delay as potentially “a blessing in disguise,” arguing that SEC and CFTC rulemaking through existing authority may prove more durable than a compromise bill weakened by political concessions.

Hawaii bans cash-to-crypto ATM transactions from October 1

Governor Josh Green signed House Bill 1642 into law on July 9 as Act 224, prohibiting operators from accepting U.S. currency in exchange for digital assets at kiosks, effective October 1, 2026. The law targets cash-to-crypto deposits, specifically crypto-to-cash withdrawals and crypto-to-crypto exchanges remain permitted. Lawmakers cited FBI data showing 92 kiosk-related complaints and $3.85 million in adjusted losses from Hawaii residents in 2025, with more than half of national complaints coming from people over 50.

Hawaii joins Indiana (full ban, March 2026), Tennessee (full ban, July 1), and Minnesota (full ban, August 1) in restricting crypto kiosk operations, while Georgia adopted transaction caps and customer protections instead. Arizona separately enacted a crypto ATM law helping 35 scam victims recover $171,000 through a reimbursement mechanism for qualifying new customers who notify operators and law enforcement within 30 days.

Ireland proposes industry standards for illicit crypto use

Ireland introduced proposed policies under its AML framework that include stricter measures on transfers from private crypto wallets and overseas digital asset companies. The proposed standards represent an expansion of anti-money laundering obligations specifically targeting illicit cryptocurrency channels.

Crypto Holdings and Acquisitions

World Liberty Financial (WLFI) wins conditional bank charter

The Office of the Comptroller of the Currency, on August 14, granted “preliminary conditional approval” to World Liberty Trust Co., making the Trump-family-backed crypto venture a conditionally approved national trust bank. The charter allows WLFI to issue and redeem its USD1 stablecoin directly, manage reserves, and provide digital asset custody under federal supervision.

President Trump is expected to attend a White House meeting with crypto CEOs the following week, with participants from the worlds of crypto, prediction markets, and AI anticipated. The approval intensifies ongoing debates about conflicts of interest, given that 75% of WLFI token sale proceeds flow to a Trump-controlled entity and the Trump family has earned over $2.3 billion from crypto ventures since the president’s second term began.

Tether completes first-ever Big Four financial audit

Tether announced on August 13 that KPMG U.S. had completed a full independent financial statement audit of the $180 billion USDT issuer’s 2025 financial statements, returning an unqualified opinion — the most positive form an independent auditor can issue. KPMG examined Tether’s complete financial reporting system including internal controls and asset valuation, and physically counted the company’s gold bars.

The audit represents a significant shift from Tether’s previous reliance on monthly attestations from BDO Italia, which fell short of full audit standards. Tether had engaged KPMG in March 2026, with PwC separately brought in to prepare internal systems. The milestone comes as the US GENIUS Act mandates comprehensive audits for payment stablecoin issuers, and Tether has launched a separate U.S.-compliant stablecoin (USAT) through Anchorage Digital Bank.

Criminal Matters

NFT startup founder indicted for securities and wire fraud

On August 5, 2026, the U.S. Attorney’s Office for the Southern District of New York announced the indictment of Taj Tarsha, founder of Few and Far Limited, for securities and wire fraud. The charges relate to alleged fraudulent conduct in connection with the NFT startup, following a pattern of crypto-related fraud prosecutions from the SDNY.

Three Missouri men charged in cryptocurrency robbery scheme

Three Missouri men were charged by indictment for their alleged involvement in an attempted physical robbery of Bitcoin in August 2024, with charges unsealed in the first week of August 2026. This matter highlights the growing threat of physical attacks targeting cryptocurrency holders, a trend documented by CertiK’s H1 2026 report showing $124 million in losses from “wrench attacks” as physical coercion attacks surged 33%.

Delio CEO sentenced to 15 years in South Korea for $49 million crypto fraud

A Seoul court sentenced Delio CEO Jeong Sang-ho to 15 years in prison after finding him guilty of defrauding more than 1,100 investors of approximately 70 billion won ($49 million) in crypto assets. Delio had accepted Bitcoin and Ethereum deposits with promises of high yields which advertised guaranteed annual returns of around 10% and branding itself a “crypto bank”, before abruptly blocking customer withdrawals in June 2023.

Prosecutors had sought a 20-year sentence and alleged 2,800 victims with losses of 250 billion won, but the court excluded much of that evidence after finding that the prosecution’s search and seizure of a server operator was illegal. Jeong was also convicted of registering Delio as a virtual asset service provider using falsified documents that overstated coin holdings by 47.6 billion won.

South Korea is equally tightening exchange oversight: from August 20, controlling shareholders of virtual asset service providers will start facing new vetting based on legal history, finances, and social standing.

Australian watchdog suspends Cryptolink, forcing 96 ATMs offline

Australia’s financial regulator suspended Cryptolink’s registration, immediately taking 96 cryptocurrency ATMs offline across the country. The regulator cited missing transaction reports and the company’s failure to respond to an information request, reflecting the global trend of regulators cracking down on crypto ATM operators over AML compliance failures.

Lawsuits & Court Rulings

CFTC invokes emergency powers to keep Kalshi operating in New York

The US CFTC, on August 11, used its “emergency authority” to order Kalshi to continue offering prediction markets in New York after the state’s July 31 lawsuit sought to shutter the platform as an illegal gambling operation. CFTC Chairman Selig escalated the jurisdictional fight, complaining that “New York intends to make event contract derivatives waste away under its iron curtain of state gaming laws before the courts get the chance to issue final rulings”.

Kalshi has moved to transfer the case to federal court while New York moved to transfer it back; both motions still awaiting the court’s ruling. The CFTC separately warned prediction market platforms to “dial back faulty filings for incentives to boost trading,” suggesting the industry is developing bad compliance habits that may allow for market abuse.

Blockchain Association backs Custodia in Supreme Court battle over Fed access

The Blockchain Association filed arguments supporting Custodia Bank’s case before the Supreme Court, asserting that the Federal Reserve should not have broad discretion to deny eligible state-chartered banks direct access to its payment system. The case has implications for crypto-native institutions seeking master accounts, which would allow direct settlement through the Fed’s payment systems rather than routing through bank intermediaries.

NYC council probes “predatory marketing” on prediction markets

New York City Council Speaker Julie Menin sent letters to four companies offering prediction market services to New Yorkers as part of an investigation into their marketing practices, announcing a probe into “predatory marketing practices”. The investigation adds a municipal layer to the state and federal battles already engulfing Kalshi, Coinbase, and Gemini’s prediction market operations.

Mood of Market

Bitcoin remains range-bound near $63,000 as regulatory uncertainty compounds

Bitcoin has continued its narrow consolidation during the first two weeks of August, trading around $63,000–$63,500 with market capitalization at approximately $1.274 trillion. The Fear & Greed index sat at 30; firmly in “Fear” territory, while Bitcoin’s news sentiment registered 34/100 (bearish) on CryptoSlate’s tracking.

Spot Bitcoin ETFs saw back-to-back outflows for the first time since late July around August 12–13, with Bitcoin wiping out the prior week’s gains as altcoins struggled to find direction. However, the week ending August 7 had been the strongest since April, with $854 million in net inflows. This inflow surge has been linked to a July 30 Coldcard hardware wallet exploit that drained $130 million, highlighting the custodial security advantage of ETFs over self-custody.

The regulatory atmosphere has also weighed heavily on the market — the Clarity Act’s failure to advance in the Senate, the SEC’s Reg Crypto postponement, and the delayed innovation exemption for tokenization have all contributed to a souring outlook. Meanwhile, JPMorgan shuttered its banking relationship with Polymarket over regulatory concerns, and RedotPay shelved a planned $1 billion U.S. IPO.

BTC faces key support at $62,000–$61,300, with signs showing that a break below could accelerate selling toward $57,000–$58,000 liquidation clusters.

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And that’s a wrap on today’s edition!

This Newsletter is published for informational purposes only and does not constitute legal or investment advice.

As usual, our updates cut across 5 focal points:

1. Developments in Global Regulatory Frameworks;

2. Crypto Holdings and Acquisitions;

3. Court Rulings, Lawsuits and Settlements;

4. Criminal Matters; and

5. Mood of the Market.

Let's get into it!

Developments in Regulatory Frameworks

CLARITY Act negotiations intensify as August 10 deadline looms

The Digital Asset Market Clarity Act (CLARITY) does not contain a "dead by August 10" provision, but that date marks the start of the Senate's state work period — the final opportunity to pass the bill before senators return to their districts, after which the process would stall until mid-September.

The stakes are considerable: the total crypto market was valued at $2.28 trillion as of 20 July, with Bitcoin representing roughly 56% of that figure and the CLARITY Act set to determine how much of the remaining $680 billion in altcoins falls under securities or CFTC oversight.

Sponsors circulated an updated draft around 22 July as negotiations continued, prompting a formal statement from the Bank Policy Institute on the revised text on 22–23 July, following the Institute's earlier warning that the bill's current form could create gaps in existing crypto anti-money-laundering coverage.

EU adopts 21st Russia sanctions package with first-ever crypto third-country ban tool

The Council of the European Union adopted its 21st sanctions package against Russia on 23 July 2026, its largest batch of individual listings in four years, comprising 218 new designations (48 individuals and 170 entities).

The package specifically targets the A7 cross-border payments network and its A7A5 stablecoin, whichhas processed nearly $120 billion and was purpose-built for Russian sanctions evasion. For the first time, the EU introduced a transaction ban tool capable of prohibiting any dealings between EU operators and crypto-asset service providers used by Russia, alongside an immediate transaction ban on 14 named crypto-related platforms based in Georgia, Panama, the UAE, the Marshall Islands, Kyrgyzstan, and Belarus.

Among the 18 total crypto and payment entities named, the Justin Sun-linked exchange HTX was added to the sanctions list, with a roughly 30-day wind-down period before the transaction ban takes effect on 23 August. High Representative Kaja Kallas said the package also hits "over a hundred banks and crypto operators" along with Russia's shadow fleet and oil refineries. The sanctions land just three days after Russia's State Duma passed its own comprehensive crypto framework, with most provisions set to take effect on 1 September.

Crypto Holdings and Acquisitions

Mirae Asset completes takeover of Korbit, rebrands as Digital X

South Korea's largest financial conglomerate, Mirae Asset, completed the first acquisition of a licensed cryptocurrency exchange by a domestic financial group, taking its stake in Korbit to a controlling 91.73% on 22 July and to a full 97.15% by 24–25 July, for a total investment of roughly ₩141.4 billion (about $96 million). South Korea's Fair Trade Commission had cleared the deal on 9 July, noting Korbit's small market share meant the transaction posed no competition concerns.

On 23 July, Mirae Asset Group founder Park Hyeon-joo formally announced the rebrand to Digital X in a letter to Korbit employees, framing the platform as an "intelligent investment platform" that will integrate real-world assets, security token offerings (STOs), stablecoins, and traditional financial products under a single compliance framework; an advantage made possible because Mirae Asset now holds both a securities license and Korbit's Virtual Asset Service Provider (VASP) registration.

The deal is widely seen as a purchase of regulatory infrastructure, ahead of South Korea's tightening of VASP entry rules on 20 August 2026.

Tether-backed three-way bitcoin merger collapses; Jack Mallers exits Twenty One Capital

The proposed three-way merger between Twenty One Capital, Jack Mallers' Strike, and Elektron Energy has been abandoned, and Mallers stepped down as CEO of Twenty One Capital (XXI) effective 20 July to focus on Strike, the bitcoin payments firm he founded. The collapse of the Tether-backed consolidation plan adds to a broader reckoning among bitcoin treasury companies.

Bitcoin treasury companies unwind holdings and pivot toward AI

Falling share prices, debt obligations, and difficult market conditions are forcing a wave of "bitcoin treasury company" (DAT) accumulators to sell holdings, repay debt, and restructure toward artificial intelligence, with share prices for several such firms down 60–80% from their peaks.

Recent examples include K Wave Media, which sold its remaining 88 BTC on 1 July to repay roughly $6 million in debt, and Empery Digital, which sold 1,400 Bitcoin for $87.1 million within a year of adopting a treasury strategy. Even so, aggregate holdings remain substantial, with about 198 public companies collectively holding 1.268 million BTC (roughly $77.5 billion).

In a related development, Singapore-based mining pool Poolin — once the world's largest — filed for Chapter 11 bankruptcy on 22 July in New Jersey, listing $100–500 million in liabilities against $1–10 million in assets, and is seeking court approval to sell two West Texas mining sites to Thor CALAP LLC for a $52 million stalking-horse bid to help repay 11,700 wallet customers owed $163.7 million.

Lawsuits, Court Rulings and Settlements

BitMEX hit with class action over alleged forced liquidations as exchange winds down

A proposed class action filed 23 July in the U.S. District Court for the Southern District of New York accuses BitMEX, parent company HDR Global Trading, and co-founders Arthur Hayes, Ben Delo, and Samuel Reed of designing a system to retain customers' collateral through forced liquidations and diverting the balance to the platform's insurance fund.

Claimants, BKX and Namdar allege combined losses of 622.66 BTC (about $40.7 million), and the suit further claims an internal trading desk accessed private customer data and continued trading during server freezes that prevented other users from closing positions. The filing came following BitMEX’s announcement that it will close entirely on 23 September, ending an 11-year run following a management shake-up that saw its CEO, CFO, and head of growth depart the prior month.

Digital Chamber sues Illinois over new crypto tax provision

The Digital Chamber (TDC) filed suit on 21 July in Sangamon County against the Illinois Department of Revenue, seeking to halt a Digital Asset Tax Act provision inserted into the state's budget bill the night before final passage.

TDC argues the tax discriminates against digital asset holders by applying regardless of whether a gain is realized or ownership is even transferred, and warns the provision could sweep in AI and cloud-based transactions ahead of its expected January 2027 effective date.

SEC secures final judgments in Gauntlet Holdings offering-fraud case

On 15 July 2026, the U.S. District Court for the Central District of California entered final judgments against Gauntlet Holdings, LLC and its managing member Darrell W. Rideaux, with the SEC announcing the litigation release on 24 July. The underlying complaint, filed in March 2025, alleges two separate securities fraud schemes involving Gauntlet, Rideaux, and co-defendants Ali Derakhshanfar and Sal N. Ortiz.

Apple sued over fake Bitcoin wallet app in App Store

Apple is facing a lawsuit filed 25 July by three customers who allege they lost a combined $1.8 million after falling victim to a fraudulent Bitcoin wallet application distributed through the App Store.

More details on this will be shared as the news develops.

Criminal Matters

Secret Service seizes $25 million in scam-linked crypto

Federal authorities filed five civil forfeiture complaints on 21 July after the Scam Center Strike Force, a specialized U.S. Secret Service unit, seized more than $25 million in cryptocurrency tied to romance scams, fake investment schemes, and "recovery" cons targeting prior victims.

Romance scams alone cost roughly 200 victims about $12 million, while a fake investment scheme took $10.4 million from more than 270 victims; officials say the network stretched across Southeast Asia and at times relied on forced labor to launder proceeds. Since its launch in November 2025, the Strike Force has recovered more than $800 million in illicit digital currency.

India orders takedown of Jack Dorsey's bitcoin-linked messaging app

India's Cyber Crime Coordination Centre (I4C), operating under the Home Ministry, issued a notice dated 23 July directing GitHub to disable three repositories for Bitchat, Jack Dorsey's open-source, Bluetooth-mesh messaging app capable of relaying encrypted messages and bitcoin transactions without internet access, within three hours, citing Section 79(3)(b) of India's IT Act.

The order came as "Cockroach Janta Party" student protesters in Delhi turned to Bitchat to coordinate through repeated government-imposed internet shutdowns near protest sites, with the app's India downloads surging roughly thirty-two-fold and daily active users exceeding 330,000.

India's notice argued the app's architecture "significantly impedes lawful interception, attribution, and investigation," while Dorsey publicly stated the government "does not like technologies like Bitchat and wants it taken down". Digital rights group the Internet Freedom Foundation called the takedown order “unconstitutional”.

Mood of Market

Bitcoin holds a tight range near $64,000 amid selective rotation

Bitcoin traded in a narrow band through the week, closing around $64,098–$64,637 on 25–26 July, leaving the market some room to catch its breath, and settle into a holding pattern even as an $800 billion AI-sector selloff largely left crypto untouched. There has also been a repositioning in the market, with Binance holding roughly 55% of user funds and 24% of spot volume while drawing net inflows in early July, even as the broader tracked market saw outflows.

Crpyto options have also shown a bullish tilt, with a $5 billion cluster forming in bitcoin options positioning. Nonetheless, the underlying stress in corporate bitcoin treasuries (evidenced by the wave of DAT unwinds and the Poolin bankruptcy) points to a market still working through the aftereffects of a prolonged mid-2026 downturn, even as analysts debate whether a seasonal "green July" rebound can hold into August.

And that's a wrap on today's reports.

Remember, these posts are merely for informational purposes and do not constitute financial or legal advice.

See you same place, next time!

We know you've missed getting out updates. We've missed sharing them too.

Today, we bring you a complete round-up of all things crypto policy that have come up in the industry globally, since the month of July began.

Let's get into it!

Developments in Global Regulatory Frameworks

President Tinubu signs Executive Order harmonising Nigeria's virtual asset regulation

President Bola Ahmed Tinubu has signed the Presidential Executive Order on Virtual Assets Coordination, 2026, pursuant to Section 5 of the 1999 Constitution the Federal Republic of Nigeria (as amended), to harmonise the regulation of virtual assets and strengthen cooperation among Nigeria's financial, revenue, and capital markets agencies, as announced by Mr. Bayo Onanuga, the Special Adviser to the President on Information and Strategy on 17 July 2026.

The Order responds to a fragmented regulatory environment in which virtual assets increasingly blur the boundaries between currencies, commodities, and securities, exposing Nigerians to money laundering, terrorism financing, cybersecurity, fraud, and revenue-loss risks from unregistered operators. Rather than creating a new regulator or transferring powers between agencies, the Order establishes a Virtual Asset Council — chaired by the Central Bank of Nigeria (CBN), with the Nigeria Revenue Service (NRS) and the Securities and Exchange Commission (SEC) as vice-chairs, and comprising the Nigerian Financial Intelligence Unit (NFIU) and the Office of the National Security Adviser (ONSA) — to provide policy direction and coordinate supervision.

A Virtual Assets Office, domiciled at the CBN, will handle day-to-day coordination of information-sharing, applications, and reporting among the agencies via an integrated supervisory technology platform. Registration will follow the nature of the activity: security-like activities will be registered by the SEC, while payment, settlement, custody, and related services involving non-security virtual assets will be registered by the CBN, with the Council resolving unclear cases.

The CBN is separately proceeding with a regulatory sandbox for virtual assets to test products and blockchain-based solutions under supervision before wider market release, while the NRS will release a tax policy operationalising Nigeria's tax laws for the virtual assets sector. The Federal Government is also finalising a comprehensive Virtual Assets White Paper to set out the country's longer-term policy direction, and the Council has been directed to develop a Harmonised Implementation Framework within 30 days.

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Japan’s Parliament passes landmark bill recognising crypto as financial assets

Japan's National Diet (Parliament) passed a landmark amendment on 15 July 2026 that formally reclassifies cryptocurrencies as "financial assets" under the country's securities framework, marking one of Japan's most significant digital asset policy shifts in recent years. According to Japanese lawmakers, this change reflects the reality that crypto has outgrown its role as a payment method and now functions primarily as an investment product for millions of retail users.

The bill amends the Financial Instruments and Exchange Act (FIEA) and the Payment Services Act (PSA) of Japan, moving crypto out of its prior payments-focused regime and into the framework governing stocks, bonds, and investment trusts, in recognition that crypto has outgrown its role as a payment method and now functions primarily as an investment product.

Under the revised law, more than 105 cryptocurrencies, including Bitcoin, become subject to securities-style rules, including stock-market-style insider trading bans, expanded disclosure requirements for issuers and exchanges, and an investment cap for regular investors in unaudited token projects. Penalties for unregistered crypto operators rise sharply, with the maximum prison term increasing from three to ten years and the maximum fine from 3 million yen ($18,500) to 10 million yen. The Financial Services Agency (FSA) linked the reform to explosive retail adoption, noting Japan now has over 14 million open crypto accounts, roughly 70% held by users earning under 7 million yen ($43,600) annually.

The law also clears a key legal obstacle to future spot crypto exchange-traded funds (ETFs), though no ETF products were approved in this round, as the FSA will reportedly develop an ETF framework with the Japan Exchange Group reportedly eyeing listings around 2027.

Lawmakers separately approved cutting the top tax rate on crypto income from as high as 55% to a flat, separately reported 20%, with three-year loss carry-forwards, another good catalyst that Japan may be attaining frontrunner status in the crypto policy race. The FIEA/PSA amendments take effect in 2027, while the lower tax rate is not expected until 2028.

CLARITY Act stalls as Senate window narrows

The fate of the Digital Asset Market Clarity Act (CLARITY Act) has grown more uncertain this month as the Senate's window to act before the August recess continued to shrink. A House Financial Services Subcommittee hearing titled "Building the Future of Finance: How the CLARITY Act Unlocks Innovation" was held in New York on 17 July to build legislative momentum, even though the field hearing itself could not advance the bill.

Several Senate Democrats have begun publicly branding the market-structure bill "corrupt," citing unresolved conflict-of-interest concerns tied to elected officials' crypto holdings. The Senate is now reportedly prioritising the National Defense Authorization Act over CLARITY, pushing floor consideration toward the weeks of 23 and 27 July — the only realistic windows before recess.

This prolonged delay may cause regulatory uncertainty for players in the industry. Separately, the Federal Law Enforcement Officers Association wrote to the Senate Banking Committee on 10 July expressing support for the CLARITY Act while urging refinements on decentralised-protocol accountability and anti-money-laundering standards.

GENIUS Act deadline lands as California licensing regime takes hold

18 July 2026 marked the statutory deadline for federal and state regulators to finalise implementing rules under the GENIUS Act of the covering stablecoin issuer licensing, capital requirements, custody standards, and anti-money-laundering provisions. The rulemaking process has already proven contentious, with community banks urging the OCC to deny Coinbase's national trust charter application and to close a perceived "loophole" allowing stablecoin issuers to offer yield, while the Blockchain Association has pushed back on proposals it says would undermine a “carefully negotiated compromise”.

Meanwhile, California's Digital Financial Assets Law also took effect on 1 July 2026, requiring anyone engaging in "digital financial asset business activity" with a California resident to obtain a licence from the state's Department of Financial Protection and Innovation, subject to certain exemptions.

MiCA's transitional period expires, reshaping Europe's crypto landscape

The European Union's Markets in Crypto-Assets Regulation (MiCA) transition period ended on 1 July 2026, making formal authorisation the sole gateway for firms to access EU crypto markets. This implies that any entity providing crypto-asset services to EU clients without full MiCA authorisation must now cease such activities.

The European Securities and Markets Authority (ESMA) had earlier confirmed in an April 2026 statement that no member state may extend the deadline further, and unauthorised entities were required to have wind-down plans implemented by the cutoff. Notably, more than 1,200 VASP entities held national registrations prior to MiCA, yet the conversion rate to full MiCA authorisation sat under 20% as of May 2026, meaning over 80% of formerly registered entities had not secured licences in time.

Major exchanges including Bitvavo, Bitpanda, Kraken, Coinbase, Binance, Crypto.com, OKX, Bitstamp, and Revolut have secured MiCA licences and stand to benefit from the regulation's EU-wide passporting mechanism. Approximately 70% of EU-based crypto transactions now occur on MiCA-compliant platforms, a figure expected to rise further as unlicensed exchanges wind down.

Crypto Holdings and Acquisitions

Citadel Securities buys into Crypto.com at $20 billion valuation

Crypto.com has secured its first-ever institutional funding round, announcing a $400 million strategic investment from market-making giant, Citadel Securities, that values the exchange at $20 billion, as announced on 16 July. Citadel Securities is one of the world's largest market makers, and its decision to take a direct equity stake, rather than merely providing liquidity services, signals a deepening of ties between traditional Wall Street market infrastructure and crypto-native exchanges.

The investment lands at a moment when Crypto.com has been aggressively expanding its regulatory footprint across multiple jurisdictions, and the capital injection is expected to support further institutional product development.

Metaplanet expands bitcoin treasury to 43,000 BTC

Japan's Metaplanet purchased an additional 2,823 BTC for approximately $170.7 million, lifting its total bitcoin holdings to 43,000 BTC, worth roughly $2.6 billion. This acquisition cements Metaplanet's position as the third-largest publicly traded corporate holder of bitcoin globally, trailing only Strategy and Twenty One Capital.

Alongside the purchase, the firm disclosed that its Bitcoin Income Generation business, which uses bitcoin options to produce recurring income, generated approximately ¥1.75 billion ($10.85 million) in operating revenue for the second quarter of its 2026 fiscal year, bringing first-half revenue to roughly ¥4.72 billion. Metaplanet's stock closed 3.5% higher following the announcement, reinforcing the company's dual strategy of continued accumulation paired with yield generation.

SBI Holdings builds a cross-border digital asset empire in Asia

Japan's SBI Holdings announced a flurry of crypto and blockchain moves this week, positioning itself to control the full digital asset value chain across Asia rather than chase short-term market cycles. On 17 July, SBI Group completed a majority-stake acquisition of Singapore-based crypto platform Coinhako, which holds a Major Payment Institution licence from the Monetary Authority of Singapore, as part of an effort to build a "global corridor for digital assets".

This followed a partnership announced on 16 July with Ondo Finance to tokenise Japanese equities and other assets using SBI's JPYSC yen stablecoin for settlement, and a partnership with the Solana Foundation. These moves build on SBI's agreement, reached in June, to acquire Tokyo-based exchange Bitbank for approximately $289 million (JPY 46.7 billion), a deal expected to close around October 2026 subject to Japan Fair Trade Commission approval and which would give the combined group roughly 2.9 million crypto accounts and $6.8 billion in assets under custody.

MoonPay notches its sixth acquisition of the year

MoonPay acquired Glide, a Y Combinator-backed startup that lets applications accept crypto deposits from any token, wallet, exchange, or card, in an all-equity deal announced 16 July. Glide's four-person team, including co-founders Tushar Soni and Qinyu Tong, would be joining MoonPay.

Glide's technology reportedly supports deposits across more than 100 tokens and 30 blockchain networks, processing over $100 million in annualised transaction volume. The deal marks MoonPay's sixth acquisition of 2026, following Sodot, Decent, DFlow, Entendre, and Dawn Labs.

Strategy breaks its "never sell" pledge again

Michael Saylor's Strategy (formerly MicroStrategy) sold 3,588 bitcoin for approximately $216 million between 29 June and 5 July, reducing its total holdings to 843,775 BTC, according to an SEC filing. The proceeds were used to fund distribution payments on the company's preferred stock and to replenish its US dollar reserve, which stood at $2.55 billion as of 5 July.

The sale was executed under Strategy's newly adopted Digital Credit Capital Framework, which authorises the sale of up to $1.25 billion in bitcoin to fund dividends and buybacks rather than simply accumulating and holding. The implication of this sale is that the company's bitcoin reserve is no longer being treated as an untouchable "diamond hands" position, setting a precedent that traders now expect the firm to routinely tap to service its preferred-stock obligations.

Lawsuits, Court Rulings and Settlements

US CFTC defies Michigan Court order in unprecedented prediction market showdown

The Commodity Futures Trading Commission (CFTC) has taken its most aggressive action yet against state-level prediction market regulation, invoking rarely used emergency authority to order prediction market operator, Kalshi not to comply with a Michigan state court order that requires it to cancel and refund sports-related trades placed by Michigan residents.

Recall that Kalshi also suffered a significant setback on 7 July when US District Judge Analisa Torres of the Southern District of New York rejected its bid to enjoin the New York State Gaming Commission, ruling that federal commodities law does not preempt the state's gambling laws even assuming Kalshi's sports-event contracts qualify as "swaps" under the Commodity Exchange Act (CEA).

The CFTC dispute traces back to a 29 June ruling by an Ingham County judge that temporarily barred Kalshi from offering sports event contracts in Michigan and later required the company to geofence Michigan residents by 12 August, with noncompliance penalties reportedly reaching $500,000 per day. When Kalshi began unwinding trades in response to the state order, the CFTC intervened, arguing that federal law requires registered derivatives exchanges to operate as a single, impartial national market and that treating customers differently based on state residency would violate the CEA.

Michigan Attorney-General, Dana Nessel's office rejected the CFTC's reasoning, arguing that "the State of Michigan has an obligation to protect its residents" and that Kalshi "should be required to follow the laws of Michigan". Former CFTC Chairman Timothy Massad noted that the last time the agency invoked this emergency power was in 1980, in a transaction involving food commodities - potatoes and coffee. The CFTC's litigation campaign has now expanded to at least nine states, most recently filing suit against Kentucky over a new tax targeting prediction market operators.

BitGo Holdings hit with securities class action over IPO disclosures

Multiple law firms, including Pomerantz LLP, Kessler Topaz Meltzer & Check, and Kaplan Fox, are reportedly promoting a securities class action against BitGo Holdings, Inc. in the US District Court for the Eastern District of New York, with a lead plaintiff deadline of 7 August 2026.

The suit, covering purchasers of BitGo's Class A common stock traceable to its Initial Public Offering (IPO) of 22 January 2026 and a class period running through 13 May 2026, alleges that BitGo's offering documents understated the severity of the risk that declining digital asset prices posed to its business. The complaint points to two corrective disclosures: a 26 March 2026 filing revealing a swing from $156.6 million in net income in 2024 to a $14.8 million net loss in 2025, attributed to declines in digital asset prices affecting BitGo's bitcoin treasury.

SEC's crypto retreat tested in the courts

The US SEC's pivot away from litigation-driven crypto enforcement is now being tested in bankruptcy court. The administrator for bankrupt exchange, Bittrex has asked a court to vacate the SEC's final $24 million judgment against the company, arguing that the agency's own 2026 guidance — stating that most crypto assets are not themselves securities — should nullify the 2023 judgment; the SEC has dismissed the effort as "buyer's remorse," and legal scholars say the administrator faces steep odds given the judgment's finality.

In a related development, a Connecticut federal judge granted Digital Currency Group (DGC) permission to file an interlocutory appeal over a ruling that DGC must face a proposed class action alleging it unlawfully sold unregistered securities.

Ripple CEO reveals near-death experience

In a retrospective disclosure that resurfaced this month, Ripple CEO Brad Garlinghouse revealed in a podcast interview published 8 July that the company came within weeks of shutting down after the SEC sued it in 2020, having seriously considered distributing its XRP reserve to shareholders and dissolving rather than fighting the litigation.

Garlinghouse said Ripple ultimately spent $150 million in legal fees over roughly five years of US market stagnation before the case was resolved.

Criminal Matters

DOJ moves to drop $722 million BitClub Network Ponzi case

In a striking reversal, the US Department of Justice is preparing to dismiss with prejudice its long-running criminal case against Matthew Goettsche, the alleged mastermind behind the $722 million BitClub Network crypto mining Ponzi scheme. The Deputy Attorney General's office has directed the New Jersey US Attorney's Office to drop the prosecution, with defence and prosecution teams having reached "an agreement in principle" ahead of Goettsche's scheduled October trial.

Goettsche was indicted in December 2019 on charges including conspiracy to commit wire fraud and selling unregistered securities, with prosecutors alleging that BitClub Network fabricated mining returns and paid members for recruiting new investors between 2014 and 2019. Three co-defendants, Silviu Balaci, Joseph Abel, and Gordon Beckstead, previously pleaded guilty. A DOJ spokesperson noted that the case had been pending for seven years and that "the government is recovering a substantial amount owed to investors".

Crypto investor indicted on 29 counts of fraud

A federal grand jury has indicted Benjamin Paul Wiener, a 43-year-old resident in South Dakota, US, on 29 counts including wire fraud, money laundering, bank fraud, and aggravated identity theft. Wiener appeared before a US Magistrate Judge on 10 July 2026 and pleaded not guilty.

According to the indictment, Wiener devised a scheme to obtain money and digital currency from victims who invested in his companies through materially false statements, subsequently moving the funds to conceal their source and ownership. The indictment further alleges that in April 2025, Wiener secured a $1 million line of credit from a Sioux Falls financial institution by falsifying documents and using another individual's personal identifying information without authority.

Wiener faces up to 20 years' imprisonment on the wire fraud and money laundering counts, up to 30 years on the bank fraud count, and a mandatory minimum consecutive two-year term for aggravated identity theft. He was released on bond, with trial set for 15 September 2026.

Taiwan delivers 22-year sentence in BitShine fraud case

Taiwan's Shilin District Court sentenced the ringleader behind crypto exchange BitShine, Shih, to 22 years in prison for illegally providing virtual asset services and orchestrating fraud and money laundering that defrauded over 1,500 victims of NT$1.27 billion (approximately $39 million).

According to prosecutors, Shih's group collaborated with fraud rings and an organised crime group to funnel victims' cash into USDT purchases before transferring the funds overseas, laundering more than NT$2.3 billion (about $71 million) between January 2024 and April 2025, and even hired unwitting compliance officers to design know-your-customer (KYC) procedures to make the exchange appear legitimate.

UK fraud gang jailed over police-impersonation crypto scam

Three men, including two Nigerians, Anthony Ikenwe and Kevin Nwamma were sentenced at Southwark Crown Court after defrauding eight victims of more than £4 million ($5.4 million) in cryptocurrency by impersonating police officers and directing victims to convincing fake police websites, the Metropolitan Police announced. One of the men, Anthony Ikenwe, 29, received six years for conspiracy to commit fraud and a further five years for money laundering.

Goliath Ventures Ponzi CEO pleads guilty to $250 million fraud

Christopher Alexander Delgado pleaded guilty on 30 June to wire fraud, conspiracy to commit wire fraud, and money laundering, admitting to causing at least $250 million in investor losses through Goliath Ventures, which falsely claimed to generate monthly returns of 3 to 8% by deploying funds into Uniswap liquidity pools.

In reality, reports reveal that only about $1.5 million of the roughly $400 million raised ever touched a real blockchain pool. Delgado faces up to 20 years in prison on each of the two fraud counts, a further 10 years for money laundering, with sentencing scheduled for 8 October 2026, and has agreed to forfeit eight properties, 11 vehicles, 30 watches, and dozens of luxury bags and pieces of jewellery.

Convicted Bulgarian fraudster charged with stealing back his own forfeited crypto

Bulgarian national, Rossen Iossifov appeared in the federal court at the Eastern District of Kentucky on charges of destruction/removal of property to prevent seizure, and conspiracy to commit money laundering, after allegedly orchestrating the unauthorised withdrawal and transfer of approximately $290,000 in cryptocurrency which had already been seized and forfeited to the United States.

Iossifov was serving a 111-month sentence for a prior 2021 online auction fraud conviction during which he had laundered nearly $5 million in cryptocurrency at the time of the alleged offence, and now faces up to 25 years in prison if convicted on the new charges.

Mood of Market

Bitcoin slides below $63,000 as AI stock fatigue spreads to crypto

Bitcoin fell below $63,000 on 17 July, as a deepening global selloff in AI-linked stocks bled into the crypto markets, compounded by renewed Middle East tensions. Total crypto market capitalisation fell by 1.86% to sit at $2.16 trillion, with Ether declining 1.74% alongside bitcoin's drop.

On the derivatives side, the long-short ratio in crypto futures slipped to 0.94, its lowest since early June, while the average relative strength index (RSI) across crypto pairs dipped to 42.23, edging toward the oversold territory that had previously triggered a relief bounce earlier in July. Notably, privacy coins bucked the broader downtrend, with ZEC and DASH both advancing even as most major tokens, including BTC and ETH, had negative cumulative volumes.

Regardless, underlying on-chain data show long-term holders continuing to hold roughly 72% of circulating supply, with whale wallets reportedly accumulating and exchange reserves remaining low, dynamics that traditionally support prices even amid short-term weakness.

Regulatory limbo and Strategy's sales weigh on sentiment

Market anxiety over the CLARITY Act's stalled path through the Senate has bled directly into pricing, with Polymarket's implied odds of passage this year collapsing to a record-low 31% by 17 July. This uncertainty has compounded jitters stemming from Strategy's decision to sell bitcoin to fund shareholder distributions (reported above); a shift which undermines the market's long-standing assumption that Strategy would never sell, and could create a predictable, recurring source of selling pressure going forward.

Altogether, the stalled legislative agenda Strategy's departure from its "never sell" doctrine, and a market still absorbing the shock of a 47% drawdown from October 2025 highs have left July's crypto mood cautious, even as some technical and on-chain indicators point toward the later stages of the downturn.

And that's a wrap on today's reports.

Remember, these posts are merely for informational purposes and do not constitute financial or legal advice.

See you same place next time!

Now, you have it. Feast as you please 😌

Development in Regulatory Frameworks

Trump says he can “future proof” with CLARITY Act

The fate of a US digital asset market structure bill remains uncertain as ethical concerns and political divisions continue to stall progress in Congress. On Wednesday, Donald Trump said he wants to codify a “future-proof” framework for digital assets, widely seen as a reference to the Digital Asset Market Clarity Act (CLARITY) currently under Senate consideration. Writing on Truth Social, Trump argued the legislation would prevent future administrations hostile to crypto from reversing regulatory gains.

The CLARITY Act passed the House in July 2025 but has since faced prolonged delays in the Senate due to government shutdowns, industry resistance and concerns over conflicts of interest. These concerns include Trump family links to crypto ventures such as memecoins, World Liberty Financial, its USD1 stablecoin and a Bitcoin mining firm. Although the Senate Agriculture and Banking Committees advanced the bill earlier this year, it still requires bipartisan support to clear the narrowly divided Senate, with some Democrats insisting on stronger ethics provisions.

Following Trump’s pledge to “never let crypto down,” Bitcoin briefly fell below $73,000. His comments echoed those of Paul Atkins, chair of the U.S. Securities and Exchange Commission, who has promoted durable regulatory frameworks. Trump also reinforced claims by Michael Selig of Commodity Futures Trading Commission authority over prediction markets like Kalshi and Polymarket, both facing mounting legal challenges at the state level.

Argentina bill targets illegal gambling sites

Argentina’s government has introduced draft legislation that would significantly tighten controls on online gambling by cutting off access to banking, payment, and crypto services for unauthorized betting platforms. The proposed Bill for the Prevention of Gambling and Regulation of Online Gambling, submitted to Congress by the Argentina Ministry of Health, aims to combat gambling addiction while strengthening oversight of digital betting activity.

A key provision of the bill links gambling enforcement directly to financial infrastructure. Banks, payment service providers, and cryptoasset service providers would be prohibited from offering services to unlicensed gambling operators. Authorities would also gain the power to block transactions connected to unauthorized platforms, potentially forcing crypto exchanges and fiat on-ramps to monitor and halt gambling-related transfers.

This approach could disrupt offshore betting sites that rely heavily on crypto deposits. Crypto intermediaries may face new compliance burdens, including identifying wallets or payment flows associated with illicit gambling. MoonPay was referenced in onboarding materials reviewed by Cointelegraph, though the company declined to comment.

The bill also broadens enforcement to advertising, banning promotion of unlicensed betting services and penalizing platforms that fail to verify authorization status. It follows earlier action against prediction markets, including a court-ordered nationwide block of Polymarket, reflecting growing global scrutiny of platforms such as Polymarket and Kalshi over potential unlicensed gambling activity.

Aave Labs gains UK FCA Crypto registration

Aave Labs’ UK subsidiaries—Push Labs Ltd. and Push Virtual Assets Ltd., collectively branded as Push have secured cryptoasset registration from the Financial Conduct Authority (FCA). The approval, granted under the UK’s Anti-Money Laundering regime, covers “certain cryptoasset activities” and enables Push to develop regulated stablecoin on- and off-ramping infrastructure in the UK.

According to the FCA registry, the London-based entity has been registered since May 12. Push positions itself as a seamless bridge between euros and stablecoins, allowing users to move funds between bank accounts and crypto wallets. This marks Push’s second major UK authorization, following its status as an Authorized Electronic Money Institution (EMI) since 2020.

The approval arrives as the UK prepares to roll out broader crypto oversight under the Financial Services and Markets Act (FSMA), expected to take effect in October 2027. Under the new framework, crypto firms will require full FCA authorization, and prior AML registration will not guarantee approval.

Push aims to offer zero-fee, non-custodial stablecoin ramps, targeting mass adoption. Currently available in Ireland, the service plans to expand across the European Economic Area. Competitors include Coinbase’s onramp and other payment-focused crypto infrastructure providers.

Aave remains the second-largest DeFi protocol, with $13.6 billion in TVL, according to DefiLlama. The milestone follows a $25 million DAO grant and additional AAVE token incentives.

Crypto Holdings and Acquisitions

CFTC seeks to reverse agreement with Gemini

The U.S. Commodity Futures Trading Commission has asked a federal court in Manhattan to vacate its $5 million settlement with Gemini, arguing that the enforcement action was based on unreliable allegations and should never have been filed under current standards.

Gemini paid the penalty in January 2025, near the end of the Joe Biden administration, after the CFTC accused the exchange of making false or misleading statements during the approval process for a Bitcoin futures contract. However, the agency now says the complaint relied heavily on a whistleblower whose claims were “known to be lacking in credibility.”

In a joint motion with Gemini, the CFTC said continuing to enforce the settlement’s forward-looking obligations, including an injunction against misleading statements, would not serve the public interest. While the fine will not be refunded, the agency seeks to end Gemini’s ongoing compliance burdens.

The move follows a broader pullback from crypto enforcement under Donald Trump. It also comes after scrutiny surrounding former CFTC chair nominee Brian Quintenz, who had discussed the case with Gemini executives Tyler Winklevoss and Cameron Winklevoss. Trump later withdrew Quintenz’s nomination and supported Mike Selig instead.

The original case centered on claims that Gemini misrepresented auction volumes and liquidity, allegedly inflating trading activity. The CFTC now contends Gemini was itself a victim of fraud by customers exploiting fee rebates. The agency confirmed that the $5 million penalty will stand regardless of the court’s decision.

SEC approves Paxos as ‘blockchain native’

Blockchain infrastructure firm and stablecoin issuer Paxos has become the first blockchain-native company to receive approval from the U.S. Securities and Exchange Commission to operate as a registered clearing agency. The authorization was granted to its subsidiary, Paxos Securities Settlement Company, allowing it to provide clearing and settlement services as a central securities depository in the United States.

Paxos described the approval as a key milestone in bridging blockchain technology with traditional capital markets. Clearing agencies play a vital role in financial markets by validating trades, matching buyers and sellers, and ensuring the proper exchange of securities and funds. With SEC approval, Paxos’ blockchain-based clearinghouse lowers regulatory barriers for banks and brokerages seeking to build crypto-enabled market infrastructure.

The decision follows years of regulatory engagement. In 2019, the SEC issued Paxos a no-action letter permitting a pilot blockchain settlement program for U.S. equities, which launched in 2020. According to Paxos, the pilot proved that blockchain systems can enable same-day settlement, lower costs, and improve efficiency within a regulated framework.

CEO Charles Cascarilla said the registration reflects seven years of collaboration with regulators. Paxos also issues digital assets such as PayPal USD (PYUSD), Global Dollar (USDG), and Pax Gold (PAXG).

Despite past regulatory challenges, including scrutiny over Binance USD under former SEC chair Gary Gensler and action by the New York Department of Financial Services — the SEC closed its investigation in 2024. Paxos later reached a $48.5 million settlement with NYDFS in 2025 related to BUSD compliance issues.

Criminal Matters

FBI seized $8 billion in cryptocurrency amid scam

U.S. authorities have carried out a sweeping, intercontinental crackdown on global scam networks, seizing a record $8 billion in cryptocurrency and arresting hundreds of suspects. The operation, led by the Federal Bureau of Investigation, targeted so-called “scam compounds” tied to organized crime groups accused of defrauding Americans—sometimes costing individual victims millions of dollars.

A key target was the Democratic Karen Benevolent Army, an armed militia from Myanmar with alleged links to Chinese organized crime and already under U.S. Treasury sanctions. Authorities say the group played a central role in large-scale online scams.

The largest single seizure involved more than 127,000 bitcoin taken during the arrest of Chen Zhi, CEO of Prince Holding Group, in Cambodia—an amount officials call the biggest forfeiture in U.S. government history.

According to FBI Director Kash Patel, the bureau helped dismantle scam hubs across Asia, Africa, and the Middle East, freed nearly 2,000 trafficked workers, shut down billions in fraud, and arrested close to 300 people. Raids in Thailand and Dubai led to mass equipment seizures and arrests, with several suspects facing extradition to the United States.

Ex- Hodlnaut CEO charged with fraud

Former Hodlnaut CEO Zhu Juntao has been charged in Singapore with six counts of fraud by false representation over alleged misleading statements made after the 2022 collapse of the Terra ecosystem. The Singapore Police Force said the charges followed an investigation by its Commercial Affairs Department and relate to claims about Hodlnaut’s exposure to the TerraUSD (UST) crash.

Police allege Zhu directed employees of Hodlnaut to issue statements between May and July 2022 asserting the platform had no direct UST exposure and suffered no related losses. These statements were allegedly shared in Hodlnaut’s official Telegram group and via emails to users. Authorities also claim Zhu posted similar assurances on his personal Twitter account (now X) in June 2022.

Zhu faces three charges under Section 424A of Singapore’s Penal Code, along with three counts under the same provision read with Section 109. If convicted, each charge carries a potential penalty of up to 20 years’ imprisonment, a fine, or both.

The case revives scrutiny of the 2022 crypto market crash, triggered when the Terra ecosystem imploded, erasing about $50 billion in value. Hodlnaut halted withdrawals in August 2022 and later entered liquidation. Other lenders, including Celsius Network and Voyager Digital, also collapsed, freezing customer funds amid the broader market rout.

Lawsuits & Court Rulings

Ex- Celcius CEO files motion to drop sentence

Former Alex Mashinsky, ex-CEO of the collapsed crypto lender Celsius, has asked a New York federal court to vacate his 12-year prison sentence for fraud and market manipulation. In a filing submitted without a lawyer to the U.S. District Court for the Southern District of New York, Mashinsky challenged the 144-month sentence imposed in May 2025, arguing ineffective assistance of counsel and alleging that parts of the case relied on tainted evidence.

Though Mashinsky pleaded guilty to commodities and securities fraud, he claimed his attorneys ceased communicating with him, forcing him to proceed pro se. He also alleged that former FTX CEO Sam Bankman-Fried sought to undermine Celsius and was responsible for manipulation involving the platform’s CEL token. Mashinsky further accused former Celsius chief revenue officer Roni Cohen-Pavon of attempting a “hostile takeover,” submitting text messages to support the claim.

Celsius filed for bankruptcy in 2022 during a broader crypto market collapse that also ensnared FTX. U.S. prosecutors charged Mashinsky and Cohen-Pavon in 2023; both later pleaded guilty. Cohen-Pavon received time served after providing substantial cooperation.

Separately, Mashinsky was ordered to forfeit $48 million and agreed to pay $10 million under a settlement with the Federal Trade Commission. Cohen-Pavon agreed to pay over $1 million plus a $40,000 fine.

China's supreme court to study crypto rules

China’s Supreme People’s Court (SPC) plans to develop clearer adjudication rules for disputes involving cryptocurrencies, cross-border finance, artificial intelligence and data rights, even as the country’s sweeping crypto ban remains in place.

Speaking at a press briefing, SPC judicial committee member Liu Guixiang said the court will research how to handle emerging digital-economy cases, including virtual currency disputes, and issue judicial interpretations on civil liability for insider trading and market manipulation. The court will also study legal protections for AI-related cases, data ownership, data transactions and AI-generated content, aiming to improve consistency in rulings as such cases increase.

The move follows heightened scrutiny of crypto-related crimes, including a high-profile case involving Chen Zhi, founder of Prince Group, who was arrested in Cambodia in January 2026 and extradited to China over alleged scam operations. In 2025, the United States Department of Justice seized roughly $15 billion in Bitcoin tied to the case.

China’s stance on crypto has long been restrictive. The People’s Bank of China first limited Bitcoin services in 2013, imposed a comprehensive ban on crypto trading and mining in 2021, and recently prohibited unauthorized yuan-pegged stablecoins and tokenized real-world assets. These steps underline China’s strategy of promoting its state-controlled digital yuan CBDC while excluding private crypto alternatives.

Mood of Market

Bitcoin falls out of Top ten assets

Bitcoin’s recent sell-off has pushed its market capitalization below $1.5 trillion, knocking it out of the world’s top 10 assets by value. After sliding from about $83,000 in early May to nearly $72,000, Bitcoin saw its market cap fall from roughly $1.66 trillion to $1.45 trillion, dropping it to 13th place globally.

The decline reflects a broader rotation by investors away from crypto and into assets benefiting from macro uncertainty and technological optimism. Precious metals surged amid geopolitical tensions, with Gold and Silver rallying to historic highs, elevating them to the first- and fifth-largest assets by market cap, respectively. At the same time, AI and semiconductor stocks continued to outperform. Companies such as Taiwan Semiconductor Manufacturing Company, Broadcom, and Micron Technology surpassed Bitcoin in valuation, with Micron recently crossing the $1 trillion mark.

Technically, Bitcoin faces additional pressure. Analysts warn of a potential “death cross” forming between its realized price and the 365-day moving average, a signal that previously preceded deep bear-market declines. While a repeat of past 50% drawdowns would imply prices in the low $30,000s, many analysts believe Bitcoin’s long-term scarcity limits such downside.

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Development in Regulatory Frameworks

Petition to scrap South Korea crypto tax increases

A petition opposing South Korea’s planned 22% tax on cryptocurrency investment gains has crossed the threshold required for parliamentary review. More than 52,000 people have signed the petition, triggering consideration by the Finance and Economic Planning Committee.

The tax, scheduled to take effect in January 2027, is widely criticized for placing a heavier burden on crypto investors than on other asset classes, which benefit from significantly lower tax rates. Petitioners argue the measure imposes excessive financial and reporting obligations, disproportionately affecting younger investors already priced out of the housing market. They warn that the policy could weaken South Korea’s competitiveness in the global crypto industry and accelerate the outflow of capital and skilled talent abroad.

South Korea has been a major crypto hub in the Asia-Pacific region, with roughly 32% of the population owning digital assets as of March 2025. However, industry data shows a sharp contraction: the total value of crypto holdings fell from 121.8 trillion won in January 2025 to 60.6 trillion won by February 2026, while daily trading volumes on major exchanges dropped from $11.6 billion to about $3 billion.

Critics also point to tighter Anti-Money Laundering and Know Your Customer rules. In March, the Financial Services Commission and the Financial Intelligence Unit proposed flagging all cross-border crypto transactions above 10 million won, a move industry groups say could further strain exchanges.

Polymarket seeks entry into Japan

Polymarket is exploring entry into Japan, despite tightening global regulation of the sector. According to Bloomberg, the company has appointed Mike Eidlin, head of Japan at crypto firm Jupiter, to lead local expansion and begin lobbying efforts. Polymarket is reportedly aiming for regulatory approval by 2030.

The move comes as prediction markets face rising scrutiny worldwide. Japan maintains strict online gambling laws, allowing betting only on government-approved activities such as horse racing and lotteries. Authorities have intensified enforcement, with illegal online betting punishable by fines and potential prison terms for repeat offenses.

Despite restrictions, Polymarket says it has seen strong organic interest across Japan and Asia. The platform already runs a Japan-focused account on X with over 53,000 followers, even though Japan is listed among its restricted jurisdictions.

Regulatory pressure has also affected trading activity. Data from Token Terminal shows Polymarket’s monthly trading volume fell nearly 15% in April, while rival Kalshi gained about 13%. Access to Polymarket is now blocked or limited in dozens of countries, including India.

Crypto Holdings and Acquisitions

Kevin Warsh sworn in as Fed Chair

Despite repeated calls from Donald Trump for lower interest rates, investors are pricing in no rate cuts for the rest of 2026, even after Kevin Warsh was sworn in as chairman of the Federal Reserve.

At the swearing-in ceremony, Trump emphasized that Warsh would remain independent from the Executive Branch on monetary policy. He pointed to record employment levels and argued that economic growth—not austerity—is the solution to America’s debt burden. Trump said the administration wants to curb inflation without slowing economic momentum.

Lower interest rates typically support risk assets such as Bitcoin and other cryptocurrencies by making borrowing cheaper. However, prolonged low rates can also fuel inflation by encouraging excessive spending and leverage.

Market expectations suggest tightening, not easing. According to the CME Group FedWatch tool, investors see virtually no chance of a rate cut in 2026. About 3.5% anticipate a 25-basis-point hike at the June 17 FOMC meeting, with the federal funds rate currently between 3.50% and 3.75%.

The probability of a July hike has risen to 17%, while roughly 67% expect a rate increase at the December meeting. Persistent high rates and uncertainty around Federal Reserve leadership may continue to pressure risk assets, including crypto and equities.

CFTC signs MoU with the National Hockey League

The US Commodity Futures Trading Commission has entered into a memorandum of understanding with the National Hockey League to safeguard the integrity of professional hockey-related prediction markets.

Announcing the agreement Thursday, CFTC Chair Michael Selig said the partnership aims to protect users from insider trading, fraud, and market manipulation. He reaffirmed the CFTC’s position that it holds exclusive regulatory authority over prediction market platforms such as Kalshi and Polymarket.

The deal mirrors a similar agreement signed with Major League Baseball in March, which coincided with MLB naming Polymarket its official prediction market exchange. Under the NHL agreement, both organizations will share information and coordinate oversight of event contracts tied to professional hockey.

Although the NHL’s 2026–27 season begins in September, Kalshi and Polymarket were already listing contracts tied to the Stanley Cup playoffs, which started in April.

Since December, Selig has served as the CFTC’s sole commissioner, despite the agency traditionally operating with five bipartisan members. Under his leadership, the CFTC has challenged state-level actions against prediction markets in Ohio, Connecticut, Illinois, New York, and Minnesota.

Meanwhile, Polymarket recently submitted a self-certification request to the CFTC seeking approval to list combinatorial outcome contracts, allowing users to bundle multiple event outcomes into a single market.

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Criminal Matters

Malicious node tied to THORchain exploit

THORChain disclosed that a recent $10.7 million exploit stemmed from a vulnerability in its GG20 threshold signature system, which is designed to protect vaults by distributing key control among multiple node operators. In this case, a malicious node operator exploited a flaw that caused “progressive key material leakage,” allowing them to reconstruct a full private key for a single vault.

Once the breach occurred, THORChain’s automated solvency checks activated within minutes, suspending signing and trading activity across several blockchains without human input. Node operators then coordinated through Discord to fully halt the network within two hours and deploy a patch. According to the post-mortem, these safeguards prevented further losses.

The incident was first highlighted by blockchain investigator ZachXBT, shortly before THORChain publicly paused operations. The exploit comes amid a broader surge in crypto attacks, with over $634 million lost in April alone, based on data from DefiLlama.

THORChain has since proposed a recovery plan under governance proposal ADR-028, which would absorb losses using protocol-owned liquidity and partially distribute remaining losses to synth holders, without minting or selling RUNE tokens. While some analysts praised the protocol’s automated defenses, others criticized the decision to continue using a patched GG20 framework, arguing the system may remain fundamentally fragile.

Ohio man sentenced to 9 years for crypto fraud

A federal court has sentenced an Ohio man to nine years in prison, followed by three years of supervised release, for running a large-scale cryptocurrency investment fraud that swindled more than $10 million from victims, many based in the Columbus, Ohio area.

Court records show that Rathnakishore Giri, 31, of New Albany, Ohio, deceived investors by presenting himself as a highly skilled cryptocurrency trader with expertise in Bitcoin derivatives. He lured victims by guaranteeing high returns while falsely claiming their principal was risk-free and fully protected. Instead, Giri frequently used funds from new investors to pay earlier ones—a classic Ponzi-style operation. Investigators also found that Giri had a history of failed trading activity and significant investment losses, which he concealed while giving investors misleading explanations when withdrawals were delayed or denied.

In October 2024, Giri pleaded guilty to one count of wire fraud. Despite being on pretrial release while awaiting sentencing, he continued soliciting money from additional cryptocurrency investors. He later admitted to this conduct as part of an amended plea agreement with the Justice Department.

Lawsuits and Court Rulings

Missouri AG sues Coin flip

Missouri has filed a lawsuit against CoinFlip, accusing the crypto ATM operator of knowingly facilitating fraudulent transactions and profiting from them. The case follows a December 2025 investigation by Missouri authorities into multiple digital currency kiosk providers over allegations of deceptive fee structures and scam-related activity.

Missouri Attorney General Catherine Hanaway said the suit targets GPD Holdings, which operates under the CoinFlip brand. The state alleges that CoinFlip’s practices enabled fraud that disproportionately affected seniors and veterans. Missouri is asking the court to declare that CoinFlip violated the Missouri Merchandising Practices Act, bar the company from operating in the state, impose civil penalties of up to $1.83 million for violations over the past five years, and order restitution for impacted consumers.

CoinFlip operates 136 crypto kiosks in Missouri and more than 4,200 across the United States. Responding to the lawsuit, the company told Cointelegraph that the claims are meritless and vowed to fight the case, arguing it supports laws designed to protect residents from scammers and that enforcement efforts should focus on criminals rather than licensed operators.

The action comes amid heightened scrutiny of crypto ATMs nationwide. Bitcoin Depot recently warned of mounting legal liabilities before filing for Chapter 11 bankruptcy, underscoring the growing legal and financial pressure on the sector.

Mood of Market

Chances of a new Bitcoin low is now very slim

Data suggests Bitcoin is unlikely to fall below $60,000 again, supported by strong long-term holder accumulation and improving technical indicators. Long-term investors now control about 71.6% of Bitcoin’s circulating supply, a level historically associated with price stability and future upside.

According to analyst Sykodelic, the risk of Bitcoin setting new lows has become minimal after the weekly relative strength index (RSI) reclaimed the 50 level. In past market cycles, this recovery has typically marked the start of extended bullish phases following oversold conditions. The current RSI rebound occurred roughly 105 days after Bitcoin entered oversold territory, a rare event that has happened only four times. The only exception was in 2022, when the FTX collapse disrupted the market.

Additional onchain data reinforces this outlook. Analyst CryptoZeno noted that Bitcoin’s one-year-plus holder metric has returned to a historical accumulation zone seen before major rallies in 2013, 2016, 2019, and late 2022. Unlike past cycle peaks in 2017 and 2021, current data shows steady accumulation rather than distribution, reducing available supply.

However, miner behavior remains cautious. Binance Pool reserves continue to decline slightly, indicating ongoing operational selling. While metrics like the Miner Position Index and Puell Multiple show revenue pressure, they remain below panic levels—suggesting a consolidation or “wait phase” often seen near market bottoms.

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Development in Regulatory Frameworks

Trump is being urged to nominate CFTC members

US lawmakers are urging President Donald Trump to fully staff the leadership of the US Commodity Futures Trading Commission, warning that the agency’s current structure could hinder upcoming crypto regulation. At present, Michael Selig is the commission’s sole member, following the resignation of former acting chair Caroline Pham in December 2025.

In a bipartisan letter, House Agriculture Committee Chair Glenn Thompson and ranking member Angie Craig called on Trump to nominate a full panel of commissioners. They cited urgent regulatory demands and the anticipated workload stemming from the Digital Asset Market Clarity Act (CLARITY), which would significantly expand the CFTC’s role in overseeing crypto markets.

Despite operating without four additional commissioners, Selig has continued advancing rulemaking and has aligned the agency closely with administration policy, including asserting authority over prediction markets. He also signed a coordination agreement with the US Securities and Exchange Commission earlier this year.

The Senate Banking Committee has advanced the CLARITY Act toward a floor vote. Concerned about governance gaps, Senator Amy Klobuchar proposed delaying the law’s implementation until at least four CFTC commissioners are confirmed. As of now, no nominations have been announced, and confirmations could take months.

South Korea plans for tokenized securities

South Korea’s Financial Services Commission plans to publish detailed rules on tokenized securities in July, ahead of a full legal framework taking effect in February 2027.

The upcoming rules are expected to outline a roadmap for tokenizing assets such as stocks, bonds and money market funds, adjust over-the-counter trading limits, and allow certain fractional investment products to bundle similar underlying assets. The FSC unveiled these plans during the second meeting of its public-private Tokenized Securities Council, established in March to shape issuance, trading, infrastructure and settlement standards.

FSC Vice Chairman Kwon Dae-young said the July announcement will support the “institutionalization” of tokenized securities.

Momentum has also grown across government bodies. Bank of Korea Governor Hyun-Song Shin recently endorsed tokenized deposits, while the Ministry of Economy and Finance announced a pilot using tokenized deposits for government spending, with a full rollout planned for late 2026.

These efforts precede amendments to the Capital Markets Act and Electronic Securities Act, which will legally recognize blockchain ledgers as securities registries and bring tokenized assets fully under FSC oversight from Feb. 4, 2027.

Crypto Holdings and Acquisitions

UK politician buys #1.8M house after $6.7M Crypto gift

UK politician Nigel Farage, leader of the Reform Party, is facing scrutiny after purchasing a £1.4 million ($1.8 million) property shortly after receiving a $6.7 million “personal gift” from crypto billionaire Christopher Harborne. According to Sky News, the property transaction was completed in May 2024, weeks before Farage formally announced his candidacy in the general election.

The payment has triggered a parliamentary probe, with critics arguing the gift should have been declared after Farage entered office. Farage and the Reform Party deny any wrongdoing, insisting the funds were received before he became an MP and therefore fell outside disclosure requirements.

The controversy comes amid growing pressure from UK lawmakers to restrict or temporarily ban crypto-linked political donations. In February 2025, Matt Western, chair of the Joint Committee on the National Security Strategy, called for a moratorium on such donations, warning they could enable foreign interference in UK politics.

In March, the UK government advanced draft legislation reflecting those concerns. The proposal still requires approval from both parliamentary chambers and royal assent from King Charles III.

Banks can't rebuild for AI, says Augustus CEO

Augustus Bank CEO Ferdinand Dabitz argues legacy clearing banks cannot fundamentally rebuild their systems for AI and programmable money, following conditional approval from the Office of the Comptroller of the Currency.

The approval, granted under the GENIUS Act, moves Augustus closer to launching a Dallas-based national bank centered on fully reserved stablecoins, AI-led compliance, and automation. Final approval is expected within months.

Augustus is positioning itself as a replacement for the correspondent clearing model dominated by incumbents like Citi, which Dabitz describes as outdated and built for human workflows rather than machine-native finance.

Founded in Berlin in 2021 as Ivy, Augustus already operates euro-clearing and instant settlement for clients including Kraken.

While giants like JPMorgan invest heavily in AI, Dabitz says Augustus’ clean-slate design allows faster innovation. The bank aims to shrink compliance processes from hours to minutes using AI.

Signal hints it could exit Canada

Signal has warned it may leave Canada rather than comply with Bill C-22, a proposed lawful access law that critics say could undermine end-to-end encryption.

Signal’s VP of strategy Udbhav Tiwari told The Globe and Mail the company would not compromise privacy guarantees. He argued Bill C-22, which would require service providers to build surveillance capabilities and retain metadata for up to a year, could introduce systemic vulnerabilities.

The bill, introduced in March, has drawn comparisons to the EU’s controversial chat-control proposal. Canadian Conservative MP Jacob Mantle said most MPs rely on Signal precisely because of its privacy protections.

While the bill is still under parliamentary review, reactions are mixed. Meta welcomed parts aiding law enforcement but acknowledged risks. VPN provider Windscribe said it would also consider exiting Canada.

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Criminal Matters

Myanmar Military imposes life imprisonment on crypto scammers

Myanmar’s military-led government has published the text of a proposed Anti-Online Fraud Bill that introduces some of the harshest penalties globally for online and cryptocurrency-related crimes. The bill, released Thursday, was proposed by Myanmar’s parliament in response to what authorities described as a growing threat to the country’s “sovereignty and stability” from online fraud operations.

Under the proposed law, individuals convicted of “digital currency fraud” or online fraud could face prison sentences ranging from ten years to life, with the possibility of the death penalty. Capital punishment would also apply in cases linked to scam centers, particularly where a victim died after being coerced or exploited into participating in online fraud schemes.

The bill stands out for its severity amid increasing concern over scam centers operating across Southeast Asia. In January, China reportedly executed 11 people connected to scam networks in Myanmar accused of trafficking Chinese nationals.

The United States said in April that joint operations with authorities in China and Dubai led to more than 200 arrests and the shutdown of nine scam centers. U.S. agencies estimate Americans lost over $11 billion to crypto scams in 2025 and more than $20 billion to online fraud overall.

Myanmar’s parliament, reconvened after the 2021 military coup, is expected to consider the bill in early June.

Ex – Celsius executive sentenced to time served

A U.S. federal judge has sentenced Roni Cohen-Pavon, former chief revenue officer of failed crypto lender Celsius, to time served and one year of supervised release following his 2023 guilty plea to fraud and conspiracy charges.

Judge John Koeltl ruled that Cohen-Pavon’s nearly three years since arrest were sufficient punishment for his role in manipulating the price of Celsius’s CEL token and defrauding platform users.

Cohen-Pavon was indicted in July 2023 alongside former Celsius CEO Alex Mashinsky after the company’s 2022 collapse. Mashinsky has since been sentenced to 12 years in prison and ordered to forfeit $48 million. Cohen-Pavon agreed to forfeit over $1 million and pay a $40,000 fine.

In a letter to the court, Cohen-Pavon expressed remorse and said he intended to rebuild his character and family life. With both sentences issued, the major criminal cases tied to Celsius are nearing their conclusion.

Lawsuits and Court Rulings

FTX victims sue Fenwick & West LLP

Twenty FTX victims have filed a $525 million lawsuit against Fenwick & West LLP, alleging the firm actively helped sustain one of the largest frauds in crypto history.

Filed in the US District Court for the District of Columbia, the suit represents plaintiffs from five countries who say Fenwick’s role gave FTX legitimacy that prevented them from withdrawing funds before the exchange imploded. The complaint relies on testimony from Nishad Singh, who told jurors he warned Fenwick lawyers about misuse of customer funds—and claims they advised him on concealing it.

The lawsuit alleges Fenwick created shell entities, including North Dimension Inc., which allegedly funneled more than $3 billion in stolen customer funds, and implemented FTX’s Signal auto-delete policy that prosecutors said helped evade regulators.

Plaintiffs seek over $525 million in damages, fee disgorgement, and punitive damages. Last month Lewis Kaplan rejected Bankman-Fried’s request for a new trial.

NY Judge delays hearing on Aave’s bid

A New York federal judge has delayed a decision on Aave’s emergency request to unfreeze $71 million in crypto linked to victims of the $293 million Kelp DAO hack, ordering supplemental briefings from both sides ahead of a June hearing.

In filings at the Southern District of New York, Judge Margaret M. Garnett said Aave failed to clearly explain how “compounding losses” to users would occur if a restraining notice remains in place. That notice, filed in early May by Gerstein Harrow LLP, asserts that its clients have competing claims to the frozen assets.

Aave argues that keeping the funds locked could trigger user liquidations and broader DeFi market instability. The $71 million in ETH was frozen by Arbitrum after the hack, and Aave wants to deploy it to support recovery efforts.

Judge Garnett acknowledged the risks but said the legal issues are complex. She requested further briefing on six points, including creditor priority and whether a constructive trust is appropriate.

Both parties must submit additional briefs by May 22. Meanwhile, Kelp and Aave say the hacker’s rsETH has been burned on Arbitrum, and roughly $278 million in lost tokens will be restored over the next two weeks.

Mood of the Market

Ethereum analysts see downside risks

Market analysts warn that Ether faces renewed downside risk, with indicators pointing to a potential 20% decline toward the $1,700 zone.

Despite a 40% rebound from lows below $1,800, ETH failed to break above the $2,400 resistance level. Analysts attribute this to rising exchange inflows and fading institutional demand. ETH reserves on Binance jumped from 3.36 million to 3.84 million between May 5 and May 9, coinciding with a 7% price drop.

Net ETH inflows to exchanges surged to 585,000 ETH on May 13—the largest since December 2025. Demand for spot Ethereum ETFs has weakened, with four straight days of outflows totaling $190 million.

Technically, ETH has broken down from a rising wedge pattern. A confirmed daily close below $2,280 could open the door for a move toward $1,725.

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Development in Regulatory Frameworks

Clarity Act Markup

The CLARITY crypto market structure bill could reach markup stage in the US Senate Banking Committee as early as next week, according to Coinbase vice president of US policy Kara Calvert.

Speaking at the Consensus 2026 conference in Miami, Calvert said the bill will need at least 60 Senate votes to pass, making Democratic support essential. She noted that lawmakers and industry stakeholders are working to preserve bipartisan backing.

Recent polling by HarrisX shows strong voter demand for federal crypto rules. Seventy percent of respondents said the US should already have enacted clear cryptocurrency legislation, while 62% said it was important for the country to lead globally on digital finance standards.

The CLARITY bill stalled in January after Coinbase withdrew support, citing concerns around protections for open-source developers, restrictions on stablecoin yield, and decentralized finance oversight. Calvert also pointed to tax policy as a larger obstacle to institutional crypto adoption than market structure, criticizing current IRS reporting requirements that mandate transaction-level documentation, even for minimal amounts. She expressed optimism that crypto tax reform legislation could advance later in 2026.

South Korea confirms 22% crypto tax

South Korea’s Finance Ministry has confirmed that its long-postponed cryptocurrency tax will take effect in January 2027. Moon Kyung-ho, director of the ministry’s income tax division, made the announcement at a parliamentary forum on virtual asset taxation held in Seoul.

Under the current Income Tax Act, profits from transferring or lending digital assets will be classified as “other income” starting January 1, 2027. Crypto investors earning more than 2.5 million won annually will be subject to a 22% tax, including local levies. The measure is expected to apply to more than 13 million investors nationwide.

Moon said the National Tax Service is finalizing operational guidelines and has held consultations with major domestic exchanges, including Upbit and Bithumb. Draft guidance is expected to be released for legislative review later in 2026.

The crypto tax has previously been delayed twice amid political debate and industry concerns. Despite proposals from the ruling party to cancel the tax altogether, regulators appear committed to enforcement.

US lawmakers bar provision on risky tokens

Earlier in 2026, major cryptocurrency exchanges Coinbase, Kraken, and Gemini reportedly lobbied US senators to amend a digital asset market structure bill. The firms urged lawmakers to remove language that would have limited trading to tokens deemed “not readily susceptible to manipulation,” warning that such a requirement could restrict listings of smaller digital assets.

The revision was reportedly made after the Senate Agriculture Committee advanced its version of the bill in January. Shortly afterward, the Senate Banking Committee delayed its markup after Coinbase CEO Brian Armstrong said the exchange could not support the bill in its existing form, citing concerns around tokenized equities.

The proposed legislation would expand regulatory authority for the Commodity Futures Trading Commission, alongside coordination with the Securities and Exchange Commission. Despite ongoing debates over ethics provisions and stablecoin rules, lawmakers and industry figures expect the bill to advance, with passage potentially occurring before the Senate’s August recess.

Crypto Holdings and Acquisitions

US Treasury demands Binance’s compliance privately

US Treasury officials have reportedly pressed Binance to comply with the terms of its 2023 settlement with US authorities, following reports that the exchange facilitated roughly $1 billion in transactions linked to Iran.

According to The Information, the U.S. Department of the Treasury privately sent a letter reminding Binance of its obligation to adhere to a three-year monitoring program imposed under a 2023 agreement with the Treasury and the U.S. Department of Justice. That settlement included $4.3 billion in penalties and strict compliance requirements overseen by government monitors.

The reported warning followed claims that Binance dismissed employees who raised concerns internally about Iran-linked transactions. A group of US senators later urged Treasury Secretary Scott Bessent to assess whether Binance is honoring the settlement.

Binance said it is fully cooperating with the independent monitor and regulators, welcoming Treasury oversight.

The scrutiny comes amid renewed attention on Binance’s political ties after a UAE-based firm invested $2 billion in the exchange using a stablecoin issued by World Liberty Financial, a company linked to Donald Trump and his family. Trump also pardoned former Binance CEO Changpeng Zhao in October 2025.

Zhao, who pleaded guilty in 2023 to failing to maintain adequate AML controls, said at the Consensus conference in Miami that he has no plans to lead another crypto company, citing burnout.

Crypto PACs support candidates in US states politics

Two political action committees affiliated with Fairshake, a crypto industry–backed super PAC, have reported significant media spending to influence upcoming US congressional primaries across five states.

According to Federal Election Commission filings, Fairshake affiliate Protect Progress spent roughly $1.6 million supporting Democratic candidates Jasmine Clark in Georgia’s 13th District and Christian Menefee in Texas’ 18th District. The spending came ahead of Clark’s May 19 primary and Menefee’s May 26 runoff. Protect Progress also pledged $1.5 million to oppose incumbent Al Green, citing his opposition to crypto policy.

Fairshake’s Republican-focused affiliate, Defend American Jobs, reported $5.6 million in spending across races in Georgia, Nebraska, Alabama, and Kentucky. The largest share, over $3.5 million, went to Andy Barr, a pro-crypto lawmaker running for the US Senate.

With more than $193 million on hand as of January, Fairshake has already poured millions into the 2026 primaries. Industry leaders say the fate of crypto legislation, particularly the CLARITY Act, may shape midterm outcomes.

US senator questions Mark Zuckerberg

US Senator Elizabeth Warren has asked Mark Zuckerberg to explain Meta’s plans to integrate stablecoins into its platform, raising concerns over transparency and consumer safeguards.

In a letter sent Wednesday, Warren said Meta’s limited disclosure around its stablecoin initiative was “deeply troubling,” especially in light of the company’s failed 2019 attempt to launch Libra, later rebranded as Diem. She argued that Congress must fully understand Meta’s intentions as lawmakers consider major digital asset legislation.

Warren warned that Meta’s history of privacy and safety challenges warrants close scrutiny of any new financial products. She stressed that payment-related services should face strong oversight.

The senator requested that Meta provide details by May 20 on its “small and focused” stablecoin pilot, including a potential launch timeline, which third-party stablecoins are involved, and what privacy protections are in place. Meta began testing stablecoin payouts using USD Coin for select creators in Colombia and the Philippines in April.

As the ranking member of the Senate Banking Committee, Warren is closely involved in reviewing the CLARITY Act.

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Criminal Matters

Arizona AG files charges against Kalshi

Arizona Attorney General Kris Mayes has filed gambling and related criminal charges against the companies operating the prediction markets platform Kalshi, alleging the firm ran an illegal gambling business in Arizona without a license. According to Mayes, Kalshi allowed Arizona residents to wager on event contracts tied to sports as well as state and federal elections. “Calling it a prediction market doesn’t change the fact that it’s illegal gambling,” Mayes stated.

Kalshi has pushed back strongly, arguing that the case rests on “paper-thin arguments.” A company spokesperson said Kalshi operates under exclusive federal jurisdiction and should not be regulated through a fragmented patchwork of state laws. The firm also criticized Arizona for filing charges after Kalshi initiated a preemptive lawsuit.

The legal landscape remains mixed. An Ohio judge recently rejected Kalshi’s request for a preliminary injunction, finding the company failed to prove its contracts fall solely under federal oversight. By contrast, a federal judge in Tennessee blocked state enforcement actions against Kalshi earlier this year.

At the federal level, Commodity Futures Trading Commission Chair Michael Selig has publicly backed the agency’s “exclusive authority” over prediction markets and opened a new rulemaking process to clarify how federal law applies.

Crypto wrench attacks hit $101M loss

Crypto “wrench attacks”—assaults that use physical force to extract access to digital assets—have surged sharply in early 2026, according to CertiK. In just the first four months of the year, global losses reached an estimated $101 million across 34 documented incidents, nearly double the $52.2 million recorded in all of 2025. Europe accounted for 82% of cases.

France has emerged as the main hotspot. CertiK recorded 24 incidents there in 2026, while France’s organized crime prosecutors cited as many as 47. The country’s prominence is linked to the presence of high-profile crypto firms such as Ledger, Paymium, and Binance, alongside repeated data breaches and a culture of public oversharing within crypto circles.

CertiK warned that as wallet and protocol security improves, criminals are shifting toward exploiting the “human link,” making coercion the most cost-effective attack method.

The on-the-ground attackers are often poorly trained recruits, typically three to five people, hired via messaging apps and paid modest sums. In France alone, 88 suspects, including 10 minors, were indicted in April.

Lawsuits & Court Rulings

NY prosecutors raise alarm on fraud

Several New York prosecutors, including Attorney General Letitia James and four district attorneys, have reportedly raised concerns that the GENIUS Act could weaken oversight of stablecoin issuers and increase risks of financial fraud. In a letter referenced by CNN, they argued that the federal stablecoin framework may give companies legal protection that reduces their incentive to fully cooperate with law enforcement.

The officials specifically criticized major issuers such as Tether and Circle. They alleged that Tether has only selectively frozen suspicious transactions in USDT, leaving many fraud victims unable to recover stolen funds. The letter claimed that users’ assets transferred through USDT are often not frozen or returned, as the company decides on a case-by-case basis whether to assist authorities.

Circle was described as presenting itself as a compliance-focused firm, but the letter argued its victim protection policies were still insufficient. In response, Circle’s chief strategy officer Dante Disparte said the company prioritizes financial integrity and adheres to applicable US and global rules, adding that the GENIUS Act strengthens compliance and consumer protection standards. Tether said it maintains a zero-tolerance stance on illicit activity but is not legally required to follow all state-level enforcement requests, noting its headquarters is in El Salvador.

Mood of the Market

Bitcoin bulls target $115k by December

Bitcoin options data suggests strong bullish positioning for year-end, but the sentiment is more balanced than it first appears.

Around $6 billion in Bitcoin options open interest is tied to the Dec. 25 expiry, with about 92% concentrated on Deribit. Although headline figures show heavy interest in call options, especially those targeting $115,000 and above (worth roughly $1.85 billion), many of these positions are not straightforward bullish bets. A large share is used for hedging or neutral strategies that profit without requiring extreme price moves.

On the bearish side, about $1 billion is placed in put options targeting $55,000 and below. This indicates that both upside and downside extremes are being actively priced in. Roughly half of the open interest on both sides sits in “low-probability” outcome bets.

Market indicators also show caution. Put options currently trade at a 9% premium over comparable calls, reflecting moderate downside concern among professional traders. While this signals some fear, it remains within a neutral range, suggesting no strong panic or euphoria.

Despite large call exposure, the data implies a market balancing optimism with hedging rather than pure overconfidence.

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April 2026 ranks the highest month with crypto hackings. That is to say, hackings were very rampant in April. More insane!

Read the full report to find out more mind-blowing updates.

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Development in Regulatory Frameworks

Spain emerges as leading EURC retail market in Europe

Spain has emerged as the leading retail market for EURC, according to data from Brighty. In 2025 and the first quarter of 2026, Spain accounted for roughly 36% of EURC transactions and 25% of total volume on Brighty, significantly outpacing other European markets.

Brighty co-founder Nick Denisenko says Spanish users treat EURC much like a digital euro, using it for everyday spending and peer-to-peer transfers. Average transaction sizes in Spain were around €49, pointing to retail usage rather than large transfers.

By contrast, Italy and Germany showed higher average transaction values, while France stood out for predominantly large-value EURC transfers, suggesting non-retail use cases. Issued by Circle’s European arm, EURC currently represents nearly half of the euro-pegged stablecoin market.

Brighty attributes Spain’s lead to early user adoption, greater crypto familiarity, and stronger bank readiness.

Brazil bars crypto settlement

Brazil’s central bank has barred the use of virtual assets within regulated international payment rails. Under Resolution BCB No. 561, Banco Central do Brasil amended its eFX framework, requiring that all payments between an eFX provider and a foreign counterparty be settled exclusively through formal foreign exchange transactions, explicitly prohibiting cryptocurrencies or stablecoins.

The restriction also applies to firms operating under transitional eFX arrangements. While these providers may continue operating if they seek authorization by May 31, 2027, they must comply with the ban on virtual assets within eFX settlement channels. The measure does not outlaw crypto activity in Brazil outright; rather, it prevents digital assets from being used inside this regulated cross-border payments framework.

The move reflects broader concern by Brazilian authorities over the growing role of stablecoins in payments. The central bank has been working to integrate virtual assets into its foreign exchange and financial rulebook, citing risks tied to taxation, money laundering, and monetary sovereignty.

According to reporting by Reuters, BCB Governor Gabriel Galípolo has noted that roughly 90% of Brazil’s recent crypto flows involve stablecoins. The central bank has also warned Congress that stablecoins issued outside its supervisory perimeter could face bans or strict domestic conditions, particularly where they threaten regulatory parity or fragment the payments system.

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US Senate bans itself from prediction markets

The United States Senate has unanimously adopted a new rule banning senators and Senate staff from participating in prediction markets. Approved by unanimous consent, the resolution took immediate effect. Sponsor Bernie Moreno said allowing lawmakers with access to sensitive information to place bets undermines confidence in Congress and risks monetizing public office.

The move follows heightened scrutiny after a U.S. special forces soldier linked to an operation involving former Venezuelan president Nicolás Maduro was charged with using classified information to place bets on Polymarket. Lawmakers have also raised alarms over suspiciously timed wagers related to the Iran war.

Senate Democratic leader Chuck Schumer described the ban as a “no-brainer,” warning against turning Congress into a venue for gambling on wars, elections, or economic crises. He argued the restrictions should be expanded to the executive branch.

Momentum may soon extend to the House, with Ashley Hinson saying she plans to introduce a similar measure. Industry reaction was supportive: Polymarket endorsed the rule, while Kalshi CEO Tarek Mansour said his platform already blocks members of Congress and enforces insider-trading safeguards.

Crypto Holdings and Acquisitions

Polymarket pushes for broader US relaunch

Polymarket is in discussions with US regulators about restoring full access for American users, marking a potential reversal of restrictions imposed nearly four years ago. According to Bloomberg, the platform has been engaging with the Commodity Futures Trading Commission to lift the ban on US customers stemming from its 2022 settlement.

That settlement required Polymarket to block US users and pay a $1.4 million civil penalty. Any change would require a formal CFTC vote, a process that may be easier given that four commissioner seats are currently vacant.

Polymarket has already made a limited US comeback. In December 2025, it quietly rolled out a waitlist-only US app focused initially on sports-related contracts through a regulated setup, while keeping Americans off its main international platform.

A full US return would intensify competition in the prediction markets sector, where rivals like Kalshi have gained ground. Polymarket has steadily lost market share to Kalshi amid ongoing regulatory and legal pressure.

Tether proposes a three-way Merger

Tether is moving forward with plans for a three-way merger it says will create the world’s leading publicly listed Bitcoin-focused company. Through Tether Investments, it has proposed combining Bitcoin treasury firm Twenty One (XXI), crypto lending platform Strike, and mining operator Elektron Energy into a single entity.

Under the proposal, Raphael Zagury would become president of the new venture, while Jack Mallers would remain central given his dual role as CEO of Strike and XXI. No financial terms or timeline have been disclosed.

Tether and its parent company, iFinex, already hold 58.8% ownership and 71% of voting power in XXI. Tether also outsources a substantial portion of its Bitcoin mining operations to Elektron Energy.

According to Tether, the combined group would unite Bitcoin treasury management, mining, lending, financial services, and capital markets under one roof. Momentum behind the plan grew after Jack Mallers revealed a $2.1 billion credit facility from Tether at the Bitcoin 2026 Conference, aimed at expanding Strike’s Bitcoin-backed lending operations, while publicly endorsing the proposed mega merger.

US seizes $500M in Iranian crypto assets

US Treasury Secretary Scott Bessent said the United States has seized nearly $500 million worth of Iranian cryptocurrency assets as part of an expanded sanctions campaign against Tehran, exceeding a previously reported $344 million figure.

Speaking on Fox Business’s “Kudlow,” Bessent said the actions are part of “Operation Economic Fury,” launched under President Donald Trump in March 2025. The initiative aims to restrict Iran’s access to global finance through asset seizures, frozen bank accounts, and secondary sanctions targeting foreign buyers of Iranian oil.

The US is also targeting overseas assets linked to Iranian officials, including retirement funds and real estate holdings.

The Treasury had previously disclosed sanctions on crypto wallets tied to Iran, with Tether confirming it froze over $344 million in USDT at US authorities’ request. The updated $500 million total suggests additional seizures beyond those wallet freezes.

Bessent said Iran’s economy is under severe strain, citing currency depreciation of up to 70% and the collapse of a major bank in December. Since early 2025, the US Treasury’s Office of Foreign Assets Control has sanctioned over 1,000 Iran-linked entities, vessels, and individuals.

Criminal Matters

South Korea request 20 years sentence for a crypto fraudster

South Korean prosecutors are seeking a 20-year prison sentence for Jeong Sang-ho, CEO of crypto deposit platform Delio, accusing him of orchestrating fraud that left nearly 2,800 investors unable to access their funds.

During closing arguments at the Seoul Southern District Court, prosecutors said Jeong’s “active deceptive acts” and misleading promotions violated South Korea’s Act on the Aggravated Punishment of Specific Economic Crimes. Prosecutors argued Jeong worsened investor suffering by denying responsibility and remaining uncooperative.

Delio offered high-interest crypto deposit products requiring customers to lock up assets for fixed periods. On June 14, 2023, the platform abruptly halted withdrawals, freezing roughly 250 billion won ($169 million) in customer funds. A Seoul court declared Delio bankrupt in November 2024. Jeong was indicted in April 2025 for allegedly embezzling customer assets between August 2021 and June 2023. The court is expected to deliver its verdict on July 16.

The case unfolds amid a broader regulatory crackdown on South Korea’s crypto sector. Authorities recently fined Coinone and imposed a partial suspension for AML violations, following similar penalties against Bithumb.

Wasabi protocol drained for $5M+

April 2026 has officially become the most hacked month in crypto history by sheer number of incidents.

The latest case involves Wasabi Protocol, a perpetual decentralized exchange operating across Ethereum, Base, Berachain, and Ethereum Layer 2 networks. The protocol suffered a $5 million-plus exploit after an attacker compromised its single deployer wallet, gaining unrestricted control. The attacker immediately granted themselves admin rights and upgraded critical contracts to malicious versions—all without any delay, multisig approval, or secondary signer.

Onchain investigator ZachXBT and others questioned why a protocol managing significant user funds relied on a single key with instantaneous administrative power, calling it a fundamental security failure.

The Wasabi exploit closely mirrors recent attacks on Drift and KelpDAO, both compromised through similar centralized control points.

According to DeFiLlama, at least 29 separate applications were hacked in April alone, reinforcing the urgent need for stronger governance, multisig protections, and delayed admin controls across DeFi.

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Lawsuits and Court Rulings

Bithumb wins temporary court stay

A South Korean court has temporarily halted a six-month partial business suspension imposed on Bithumb, allowing the exchange to continue serving new customers while it contests the sanction.

The Seoul Administrative Court granted Bithumb’s request to stay enforcement of the penalty issued by the Financial Intelligence Unit. The ruling suspends the order until a judgment is delivered in the main administrative lawsuit.

The FIU had ordered the suspension after an inspection uncovered roughly 6.65 million alleged breaches of South Korea’s Financial Information Act, including transactions involving unregistered virtual asset service providers. It also signaled plans to impose an administrative fine of about $25 million. Under the sanction, new users would have been barred from transferring crypto to and from external wallets.

The decision adds to mounting legal pushback against the FIU’s enforcement actions. Earlier in April, Dunamu, operator of Upbit, succeeded in overturning a three-month suspension. Similarly, Coinone has secured a court-ordered pause on its own suspension while challenging AML-related penalties.

CFTC sues Wisconsin

The US Commodity Futures Trading Commission has filed a lawsuit against Wisconsin in an escalating legal dispute over who has authority to regulate prediction markets. This marks the agency’s fifth case against a US state in recent weeks.

The CFTC acted in response to Wisconsin’s own lawsuits against platforms like Kalshi, Polymarket, Crypto.com, Robinhood, and Coinbase, which the state claims are offering illegal sports-related betting without proper state gaming licenses. Wisconsin argues these event-based contracts fall under gambling laws and should be regulated at the state level.

The CFTC maintains that prediction markets are federally regulated financial instruments under its exclusive jurisdiction. In its complaint, filed alongside the US Department of Justice, the agency argued that Congress assigned oversight of such markets to the federal government. It is seeking a court ruling to block Wisconsin from applying gambling laws to these markets and to permanently prevent further enforcement actions.

Wisconsin officials, including Attorney General Josh Kaul, countered that the federal government is overreaching and undermining states’ ability to protect residents from unlawful betting activities.

Mood of the Market

Bitcoin rises briefly

Bitcoin briefly pushed to around $77,400 as bulls attempted to break through a key resistance zone, but the move faces strong headwinds from profit-taking and cautious trading. Order book data from TRDR shows more than $130 million in sell orders stacked between $76,700 and $79,300, creating a heavy supply zone that could cap upside.

Despite a negative futures funding rate and a slightly negative long–short delta (about -$1.47 million), market positioning still reflects hesitation.

Technically, Bitcoin has reclaimed $75,000 as support and moved back above its 20-day moving average near $76,067. For bulls, a stronger breakout would require sustained momentum through the $79,000 trendline resistance and a follow-through move that establishes $80,000 as new support.

However, the broader issue remains weak conviction in spot and leveraged buying. Recent intraday moves have largely been driven by liquidations rather than sustained volume, suggesting rallies may continue to lack durability without a meaningful spike in buying pressure.

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Development in Regulatory Frameworks

Crypto owners hide profits from the IRS

A recent academic study titled Review of Accounting Studies analyzed more than 221 million U.S. tax returns filed between 2013 and 2021 to assess how many Americans report cryptocurrency activity. Researchers found that only about 17.4 million individuals disclosed crypto to the Internal Revenue Service (IRS), despite surveys suggesting between 31 and 54 million U.S. adults own digital assets. This puts the estimated reporting rate at just 32–56 percent.

Under IRS Notice 2014-21, cryptocurrency is classified as property, meaning every sale, trade, or swap creates a taxable event. To improve compliance, the IRS added a virtual currency yes/no question to Form 1040 in 2019 and moved it to the top of the form in 2020. The study shows this simple checkbox significantly increased voluntary disclosure, especially among self-prepared filers without third-party reporting.

The research also highlights a missed tax-saving opportunity: many crypto investors sell assets before holding them for one year, missing out on lower long-term capital gains rates.

Looking ahead, enforcement will tighten. Beginning with the 2025 tax year, exchanges must issue Form 1099-DA under the Infrastructure Investment and Jobs Act, making unreported crypto gains far easier for the IRS to detect.

US authorities freeze hundreds of millions in crypto linked to Iran

The U.S. government has frozen $344 million in cryptocurrency linked to Iran, following coordinated enforcement actions by federal authorities and the private sector. U.S. Treasury Secretary Scott Bessent announced that the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned several crypto wallets connected to Iran, leading to the asset freeze. According to Bessent, the action is part of a broader strategy to disrupt Tehran’s ability to raise, move, and recover funds amid escalating regional tensions after joint U.S.-Israeli airstrikes in late February.

The announcement came a day after stablecoin issuer Tether confirmed it had frozen more than $344 million worth of USDT at the request of U.S. law enforcement, citing activity linked to unlawful conduct, though it did not explicitly reference Iran.

OFAC’s updated sanctions list identified two crypto addresses on the Tron network allegedly tied to Iran’s Islamic Revolutionary Guard Corps and Hezbollah.

The sanctions followed reports, including by Forbes, that Iran planned to collect Bitcoin payments from ships passing through the Strait of Hormuz. Despite a claimed ceasefire announced by Donald Trump, tensions in the region remain high.

ZondaCrypto CEO goes MIA

ZondaCrypto, originally founded in Katowice in 2014 as BitBay by Sylwester Suszek, has come under renewed scrutiny in Poland. Suszek, who has been missing since 2022, was identified by ZondaCrypto executive Przemysław Kral as the individual responsible for the exchange’s inability to access its cold wallet.

The controversy has escalated into a major political issue, with Polish Prime Minister Donald Tusk alleging potential links between ZondaCrypto and Russian capital and political influence. Tusk pointed to the exchange’s early operations and its later expansion under new management as grounds for concern.

In an official statement issued on April 17, Tusk said as many as 30,000 users could be affected, likening the situation to previous high-profile financial scandals in Poland. He also criticized Poland’s delayed adoption of laws aligned with the EU’s Markets in Crypto-Assets Regulation (MiCA), arguing that the lack of a clear legal framework limited authorities’ ability to intervene sooner.

Beyond Poland, the case may influence broader EU debates on crypto regulation, particularly calls for stronger, centralized supervision rather than fragmented national enforcement under MiCA.

Crypto Holdings and Acquisitions

Brazil bans Kalshi, amongst 27 other prediction markets

Brazilian regulators have ordered the shutdown of 27 prediction market platforms, including Kalshi and Polymarket, after reclassifying many of their contracts as gambling. The move follows a directive from the Ministry of Finance and enforcement by the National Telecommunications Agency (Anatel), with authorities arguing that these platforms operate outside Brazil’s current legal framework.

The action is anchored in Resolution 5,298 issued by the National Monetary Council, which comes into force in early May. Under the new rules, prediction contracts tied to sports, politics, entertainment, or social events are prohibited, as regulators view them as gambling-like activities rather than financial instruments. Only markets linked to economic indicators—such as inflation, interest rates, exchange rates, or commodities—will be permitted and placed under formal financial supervision.

Finance Ministry executive secretary Dario Durigan said the sector had operated with little oversight for years and warned that prediction markets could worsen household debt and expose users to financial harm. Alongside Kalshi and Polymarket, blocked platforms include PredictIt, Robinhood (via its forecasting feature), and Fanatics Markets, as well as several Brazil-focused services.

Brazil’s decision reflects a broader global trend, as multiple countries increasingly fold prediction markets into gambling or financial regulation frameworks, leading to bans or tighter restrictions.

Thailand's SEC seeks crypto futures expansion

Thailand’s securities regulator is proposing reforms that could significantly reshape the country’s crypto derivatives market. The Thailand Securities and Exchange Commission has opened a public consultation on draft rules that would allow licensed digital asset firms to offer derivatives through their existing entities, rather than being forced to set up separate companies. The move builds on earlier regulatory changes that recognized digital assets as permissible underlying assets for futures contracts.

If adopted, the reforms would lower entry barriers for crypto firms while placing derivatives activities under stricter oversight. The SEC says additional safeguards would be introduced to manage conflicts of interest and align the supervision of exchanges and clearing houses with international standards. The aim is to give investors more tools for hedging and portfolio diversification. Feedback on the proposal is open until May 20.

Thailand’s initiative mirrors broader global momentum in crypto derivatives. Blockchain.com recently launched perpetual futures trading within its self-custody wallet, while Kraken and Coinbase have rolled out similar products for non-US users. In the US, regulatory openness may be growing, with the Commodity Futures Trading Commission signaling potential progress. Anticipating approval, Kraken’s parent, Payward, has agreed to acquire Bitnomial to expand its regulated derivatives offerings.

Criminal Matters

US soldier charged with 5 felonies for using classified intel on Polymarket

U.S. authorities have arrested a U.S. Army Special Forces master sergeant accused of using classified military intelligence to profit from bets on Polymarket, earning more than $409,000. According to the U.S. Department of Justice, Gannon Ken Van Dyke, 38, was charged with multiple offenses, including theft of nonpublic government information, commodities fraud, wire fraud, and unlawful monetary transactions.

Prosecutors allege that while participating in the planning and execution of Operation Absolute Resolve—the U.S. military operation that led to the capture of Venezuelan President Nicolás Maduro—Van Dyke used his access to sensitive, classified intelligence to place targeted bets on Venezuela-related outcome contracts. Between late December 2025 and early January 2026, he allegedly placed 13 “Yes” bets predicting U.S. military action, Maduro’s removal from office, and the invocation of war powers, staking about $33,000.

After Maduro was apprehended and the contracts resolved in his favor, Van Dyke allegedly attempted to conceal his identity by deleting accounts, changing emails, and moving funds through foreign crypto vaults.

The Commodity Futures Trading Commission filed a parallel civil case, marking its first insider trading action involving prediction markets and its first use of the “Eddie Murphy Rule” under Dodd-Frank. Officials emphasized that prediction markets are not immune to insider trading laws, a warning that comes amid increased regulatory scrutiny of the sector.

UK cracks down on illegal crypto trading

The United Kingdom’s Financial Conduct Authority has carried out coordinated raids on eight locations suspected of running illegal peer-to-peer (P2P) crypto trading operations. Working with HM Revenue & Customs and the South West Regional Organised Crime Unit, the FCA inspected the sites, issued on-the-spot cease-and-desist notices, and gathered evidence for ongoing criminal investigations.

The regulator warned that unregistered P2P crypto trading is illegal in the UK and poses serious money-laundering and financial crime risks. While P2P trading allows users to buy and sell crypto directly without centralized exchanges, UK law requires such activity to be registered under anti-money-laundering rules. The FCA confirmed that no P2P crypto traders or platforms are currently registered.

These raids mark the FCA’s first enforcement action specifically targeting P2P crypto trading and follow earlier crackdowns on illegal crypto ATMs and unlicensed exchanges. The move also builds on international efforts such as Operation Atlantic, led by agencies including the National Crime Agency, the United States Secret Service, and Canadian authorities, which froze millions linked to crypto scams.

The FCA said the action signals tougher enforcement under the upcoming FSMA crypto regime, as the UK advances toward a full crypto regulatory framework expected to be implemented by 2027.

Lawsuits and Court Rulings

CFTC sues New York over bid on gambling laws

The Commodity Futures Trading Commission (CFTC) has sued New York, seeking to block the state from enforcing its gambling laws against federally regulated prediction market platforms. Filed in the U.S. District Court for the Southern District of New York, the lawsuit argues that federal law grants the CFTC exclusive authority over event-based contracts and asks the court to issue a declaratory judgment and permanent injunction against New York’s actions.

CFTC Chair Michael Selig said states are increasingly challenging the agency’s jurisdiction, warning that state lawsuits threaten Americans’ access to prediction markets and undermine federal oversight. The suit follows New York’s recent legal actions against Coinbase and Gemini, as well as earlier enforcement steps against Kalshi, which the state ordered to suspend certain sports-related contracts.

Meanwhile, a coalition of 37 states and Washington, D.C. filed an amicus brief backing Massachusetts in its case against Kalshi, arguing that federal commodities law was never intended to legalize sports betting nationwide. States maintain that gambling regulation has traditionally been a state responsibility, covering licensing, age limits, fraud prevention, and addiction safeguards—areas they say federal financial regulation does not address.

As tensions rise, states including Arizona, Connecticut, Illinois, and Nevada have intensified enforcement, with courts in some jurisdictions agreeing that prediction contracts resemble unlicensed gambling.

Wisconsin sues Kalshi over sports event contract

Wisconsin has escalated the national fight over sports prediction markets by suing several major fintech and crypto platforms. On April 23, Wisconsin Attorney General Josh Kaul filed lawsuits in Dane County against Kalshi, Robinhood, Coinbase, Polymarket, and Crypto.com, alleging they are facilitating illegal sports betting through “event contracts.”

Kaul is asking the court to block the companies from offering sports-related markets to Wisconsin residents and to declare the products unlawful under state gambling law, arguing that rebranding bets as financial contracts does not change their substance. The complaints state that the platforms profit by charging transaction fees on contracts that pay out based on real-world sports outcomes, activity that Wisconsin law largely prohibits. Kalshi is singled out, with filings claiming sports contracts make up nearly 90% of its business and generate more than $1 billion in annualized revenue.

The Wisconsin action comes amid a broader wave of state enforcement. Courts and regulators nationwide are split over whether event contracts are federally regulated derivatives or illegal wagers. While some federal agencies have supported classification under commodities law, states including Nevada, Arizona, and Tennessee have moved to block or restrict these products.

Mood of the Market

Bitcoin stalls at $78k as Oil threatens

Trading resource Mosaic Asset Company has noted that continued upside in equities will largely depend on strong earnings performance, especially as the S&P 500 trades at record highs. It emphasized that as first-quarter earnings season begins, investors should closely watch forward earnings estimates for any shifts in momentum.

In crypto markets, analysts pointed to weakening short-term structure in Bitcoin despite price stability. Trading firm Material Indicators observed that bid liquidity around $76.5K had already been removed, aligning with prior expectations. It also noted a downward trend in lower time-frame order flow, suggesting growing pressure beneath current levels.

Meanwhile, trading account JDK Analysis described recent price action as a “news-driven pump,” arguing that the short-term rally appeared overstretched. Its exchange order-book analysis suggested that Bitcoin was trading near the upper boundary of its recent two-day value range, indicating potential exhaustion at current levels.

The commentary highlights a cautious macro backdrop for equities dependent on earnings strength, alongside a technically fragile Bitcoin market where liquidity shifts and order-flow signals point to increasing risk of a near-term retracement despite recent upward momentum.

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⚖️Developments in Regulatory Frameworks

Pakistan raises years-long ban on licensed crypto firms

Pakistan has taken a major step toward formalizing its digital asset sector, with the State Bank of Pakistan lifting an eight-year restriction on banking relationships with virtual asset firms.

In a circular issued on April 14, the central bank authorized banks to open accounts for licensed virtual asset service providers (VASPs) and their customers, provided those firms are approved by the Pakistan Virtual Assets Regulatory Authority.

This decision follows the enactment of the Virtual Assets Act 2026 in March and reflects a broader policy shift away from the 2018 ban on virtual currencies toward a regulated digital asset framework. Pakistani authorities have recently signaled growing openness to the sector, including engagements with global exchanges such as Binance and HTX in late 2025. The country has also explored blockchain-based payment infrastructure through discussions with affiliates of World Liberty Financial, particularly around stablecoin-powered cross-border payments.

Under the new rules, banks are strictly limited to providing banking services and are prohibited from trading, investing in, or holding virtual assets. They must open segregated client money accounts in Pakistani rupees, maintain strict fund separation, and comply with enhanced AML, CFT, foreign exchange, and transaction monitoring requirements, including reporting suspicious activity to regulators.

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Senator Elizabeth Warren questions Elon Musk

US Senator Elizabeth Warren has formally requested details from Elon Musk regarding X Money, a forthcoming payments feature expected to be embedded into X. In a letter sent Tuesday, Warren warned that potential crypto and stablecoin integrations could introduce risks to financial stability and US national security.

A long-standing critic of both Musk and the crypto sector, Warren questioned whether X plans to issue its own stablecoin under the GENIUS Act — formally the Guiding and Establishing National Innovation for US Stablecoins Act — which permits private companies to issue dollar-pegged tokens under certain conditions. She suggested such a move could test regulatory safeguards and invite broader scrutiny of non-bank stablecoin issuers.

Warren also cited early beta information indicating that X Money may offer up to 6% interest on user deposits and collaborate with Cross River Bank, a partner previously subject to enforcement action by the Federal Deposit Insurance Corporation. She questioned how such yields could be sustainably generated when federal interest rates are significantly lower, raising concerns about risky investments or aggressive data monetization.

The letter signals potential resistance from lawmakers as the GENIUS framework opens the door for tech companies to enter the stablecoin market.

Virginia runs an update on crypto laws

The State of Virginia has updated its unclaimed property regime to formally include digital assets, marking a significant shift in how abandoned crypto is handled by the state. On Monday, Abigail Spanberger, Governor of Virginia, signed House Bill 798 into law, amending the Disposition of Unclaimed Property Act.

Under the new framework, custodians of unclaimed cryptocurrency are required to transfer those assets to the state in-kind, meaning the crypto must be handed over in its original form rather than converted to cash. The law also restricts immediate liquidation, mandating a minimum one-year waiting period after a report is filed before the state can authorize any sale. This approach helps avoid forced sales during market downturns and preserves potential upside for owners who later reclaim their assets.

The legislation also clarifies abandonment rules, deeming crypto accounts abandoned after five years of inactivity unless the owner shows engagement, such as logging in or transacting.

Virginia now joins other states moving in this direction. In 2024, Katie Hobbs approved a similar law in Arizona, while California has also brought digital assets under its unclaimed property laws.=

⚖️Crypto Holdings and Acquisitions

Elon Musk’s X and Bitcoin

X, owned by Elon Musk, is quietly fueling speculation of a major shift in crypto payments as bitcoin prices surge and the platform prepares to launch new financial tools.

Bitcoin climbed to nearly $75,000 in the past 24 hours, rebounding sharply from recent lows near $60,000. The rally comes amid renewed optimism from institutions, with Goldman Sachs suggesting the recovery may still be in its early stages.

Musk recently teased the idea of “true currency,” reigniting speculation among bitcoin supporters that X could integrate crypto more deeply. Adding to the intrigue, X’s head of product, Nikita Bier, described the past year in crypto as “rough” and hinted that X may launch “something to fix it,” while also mocking the decline of crypto activity after the platform removed automated bot accounts.

Last month, Musk confirmed that X Money—X’s long-anticipated financial product—will launch this month. The service is expected to offer peer-to-peer payments, bank deposits, debit cards, cashback rewards, and up to a 6% yield on balances across more than 40 U.S. states. Musk has described X Money as a “once-in-a-generation opportunity,” potentially featuring crypto integration, trading tools, loans, and asset management.

As X positions itself as an “everything app” akin to WeChat, analysts suggest that the platform could significantly accelerate adoption of stablecoins and broader crypto usage.

Federal Reserve Chair Nominees — Crypto and AI holdings

Kevin Warsh, President Donald Trump’s nominee to replace Jerome Powell as Chair of the Federal Reserve, has disclosed holding millions of dollars in assets, including investments linked to cryptocurrency and artificial intelligence, ahead of his Senate confirmation hearing.

According to filings with the US Office of Government Ethics, Warsh reported Excepted Investment Funds (EIFs) tied to crypto-related firms such as Compound, Dapper Labs, and Kinetic, alongside stakes in several AI-focused companies. While Warsh’s total assets exceed $100 million, the disclosure did not specify value ranges for the crypto and AI investments, a detail first reported by Reuters. Ethics rules do not require valuation disclosures for assets worth less than $1,000.

Warsh’s largest reported holdings include more than $50 million in the Juggernaut Fund and over $10 million in consulting income from Duquesne Family Office, the investment firm run by Stanley Druckenmiller.

Trump formally advanced Warsh’s nomination to the Senate in March. The Senate Banking Committee is scheduled to hold a confirmation hearing on April 21, ahead of Powell’s term expiration on May 15.

Meanwhile, Trump has yet to nominate leaders for key financial regulators, including the Securities and Exchange Commission and the Commodity Futures Trading Commission, both of which face leadership vacancies as digital asset regulation remains unresolved in Congress.

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⚖️Criminal Matters

U.S Court orders 23 year imprisonment for commission of a $20M Meta-1 coin fraud

A U.S. judge has sentenced a Texas man to 23 years in prison for his role in orchestrating a large-scale cryptocurrency fraud that stole about $20 million from nearly 1,000 investors. The sentence was handed down Tuesday by LaShonda Hunt, who also ordered restitution for victims.

The defendant, Robert Dunlap, served as a trustee for the Meta-1 Coin project, which sold a fictional digital token. Prosecutors said Dunlap showed no remorse and repeatedly lied over several years. They stressed that the sentence was meant to serve as a strong deterrent to others considering similar crimes.

A federal jury in the Northern District of Illinois convicted Dunlap in November on two counts of mail fraud, each carrying a potential 20-year sentence. From 2018 to 2023, he and his co-conspirators falsely claimed Meta-1 Coin was backed by $44 billion in gold and a $1 billion art collection allegedly featuring works by Pablo Picasso and Vincent van Gogh.

Authorities said the group used automated trading bots to manipulate prices and volumes on a fake exchange Dunlap created. In 2020, the U.S. Securities and Exchange Commission froze assets and halted the scheme, alleging investor funds were instead used for personal expenses and luxury cars, including a Ferrari.

Crypto Kidnappings rise in France

France has recorded more than 40 cases of kidnappings or hostage-taking linked to cryptocurrency since January 2026, highlighting a sharp rise in crypto-related crime compared to last year. Authorities say criminal networks are increasingly targeting wealthy crypto investors and their families, seeking digital assets as ransom.

According to Philippe Chadrys, deputy national director of the judicial police, the cases vary widely in execution, with masterminds often operating from abroad and victims’ identities sometimes disclosed to perpetrators only at the last moment. Annabelle Vandendriessche of the Interior Ministry’s organized crime unit noted that while such crimes were still rare in 2024, they escalated significantly in 2025, with roughly 30 reported cases.

Recent incidents include the abduction of a woman and her 11-year-old son in the Burgundy region, who were freed after a large-scale police operation that led to seven arrests. Another case occurred on April 10 in Anglet, where suspects mistakenly targeted the wrong individual while searching for a crypto investor.

One of the most brutal cases involved David Balland, co-founder of Ledger, who was kidnapped in January 2025 and mutilated before being released, while his partner was found restrained near Paris.

⚖️Lawsuits and Court Rulings

Kalshi Appeals, prediction markets clash

Legal observers believe the ongoing dispute over which U.S. emtity has regulatory authority over prediction markets—states or the federal government—may ultimately be settled by the United States Supreme Court.

On Thursday, the U.S. Court of Appeals for the Ninth Circuit heard oral arguments in a case between prediction market platform Kalshi and Nevada regulators. The appeal challenges a lower court ruling that barred Kalshi from offering certain event-based contracts in Nevada, on the grounds that it lacked a state gaming license.

Kalshi argued that its event contracts qualify as “swaps” regulated exclusively by the Commodity Futures Trading Commission, not state gambling authorities. The company noted that it has faced multiple state enforcement actions, including criminal charges in Arizona, though a federal court recently blocked Arizona from applying its gambling laws to Kalshi’s contracts. Similar regulatory tensions have emerged in cases involving Crypto.com and Polymarket.

The Ninth Circuit did not issue an immediate ruling. However, Paul Grewal of Coinbase suggested the dispute is likely headed to the Supreme Court, which would decide whether such contracts fall under federal commodities law or state gambling regulation.

⚖️Mood of the Market

Bitcoin price predictions warns Hyperinflation U.S dollar

Bitcoin has rebounded sharply, rising about 20% from recent lows as major Wall Street players quietly increase their exposure to crypto. The rally comes amid growing macro uncertainty, with concerns that U.S. monetary policy could further weaken the dollar and boost demand for alternative assets.

Former Federal Reserve chair Janet Yellen warned that President Donald Trump’s pressure on the Federal Reserve to cut interest rates could risk hyperinflation. Since returning to the White House in 2024, Trump has repeatedly urged rate cuts to reduce borrowing costs on the U.S. government’s nearly $40 trillion debt.

Anthony Pompliano, CEO of ProCap Financial, argued that persistent money printing and soaring interest payments strengthen the long-term case for bitcoin. Trump’s relationship with Fed chair Jerome Powell has been tense, particularly after an unexpected rate cut ahead of the 2024 election, which Trump viewed as favoring Kamala Harris.

Trump has since nominated former Fed governor Kevin Warsh, who supports rate cuts despite inflation remaining above target. Yellen expects at least one rate cut this year. Analysts at Kraken say a shift toward looser policy could significantly boost risk assets, including crypto, well into 2026.

That’s it for this week’s CRR! See you same time next week with the major developments in crypto regulation globally.

P.S: We have great news. Our Founder passed her Bar finals and has made it into the largest Bar in Africa! We are so proud of her!🥂🎊

Please drop congratulatory messages for her in the comment section.❤️

It’s been a LONG ride of crypto case studies!

Over the past two months, we have taken you through some of the most groundbreaking and policy-shifting lawsuits that have shaped the crypto industry — and we are certain that it is a ride which you have thoroughly enjoyed!

Today, we bring you the final Issue on case studies, where we talk about the Tornado Cash case and the effects it had on data privacy in crypto.

Enjoy!

Privacy is a contemporary issue that is especially vital in an increasingly overt world. In the realm of cryptocurrency, developers, founders and users have always on the lookout for more secure and confidential ways to carry out transactions.

This was the intention behind the creation of Tornado Cash, a secure and decentralized privacy protocol created to facilitate the discreet pooling of funds while restricting the ability to track or trace the coins transacted within its ecosystem. On mere mention alone, it is clear that this is a brilliant idea.

However, the risks associated with such innovations are foreseeable.

In this article, we discuss the history, fall and present state of Tornado Cash and its founders, highlighting the implications of this case on the cryptocurrency community.

What Is Tornado Cash?

Tornado Cash is a decentralized non-custodial privacy solution built on the Ethereum blockchain and utilizing zero-knowledge proofs founded by Roman Semenov, Roman Storm and Alexey Pertsev. The goal of the enables users to break links in on-chain transactions and enhance transaction privacy between deposit and withdrawal addresses.

Here's how it works.

Tornado Cash creates a secret hash when a user deposits crypto. Its protocol admits the deposits and the hash in a process known as commitment. The commitment identifies the owner of the funds and confirms them during withdrawal. When withdrawing the funds, the user must input the secret hash to prove ownership while maintaining on-chain anonymity.

It's also important to know that Tornado Cash is community-based. In May 2020, the Tornado developers surrendered the management of the protocol's multi-signature wallet via a contract update referred to as the ‘Trusted Setup Ceremony.’ Therefore, the founders lost control of Tornado, making it a completely decentralized protocol.

Why and How Was Tornado Cash Sanctioned?

In August 2022, Tornado Cash was sanctioned by the U.S. Treasury’s Office of Foreign Assets Control (OFAC) for what they believe to be a laundering scheme that has already facilitated over $7 billion worth of cryptocurrency. It is important to note that this figure has been disputed, with a cryptocurrency firm, Elliptic, claiming that the actual amount was approximately $I.5 billion. The platform has also been associated with the Lazarus group, a syndicate of hackers primarily based in North Korea. Lazarus has allegedly laundered $455million using the platform.

As part of its sanctions, Roman Semenov, one of the co-founders of Tornado Cash, was added to its list of Specially Designated Nationals and Blocked Persons (SDN) on August 23rd 2023. Another co-founder, Roman Storm, was arrested by the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigation division in Washington state the same day.

Semenov and Storm were charged with conspiracy to commit money laundering, conspiracy to commit sanctions violations and conspiracy to operate an unlicensed money-transmitting business in an indictment unsealed. The first two counts each carry a maximum sentence of 20 years in prison. The money-transmitting charge is punishable by up to five years’ imprisonment.

Semenov remains at large while the third Tornado Cash co-founder, Alexey Pertsev, was arrested and arraigned before the Netherlands Hertogenbosch Court of Appeal, Dutch judges found him guilty of money laundering and he was give a five-year and four-month prison sentence for laundering illicit digital assets, leaving only Roman Storm to face charges under U.S. law.

Present State of Things

Following the conviction of Roman Storm in August 2025 on a charge of conspiracy to operate an unlicensed money-transmitting business amongst others, reports showed that the jury was unable to reach a unanimous verdict on two more serious charges — conspiracy to launder money and conspiracy to violate U.S. sanctions, and this led to a partial mistrial of his case.

Later in 2026, Storm was further accused by the Department of Justice (DOJ) of making improvements and updates to Tornado Cash, which they say helped criminals launder funds, and in turn also made him profits. Storm’s lawyers, on the other hand, had filed a motion for acquittal, asking the Court to throw out the prosecution’s charges for want of sufficient evidence. The hearing of this motion was presided over by Judge Katherine Polk Failla of the Southern District of New York.

Storm’s lawyers further argued that creating a crypto mixing service is not illegal and that Storm did not build Tornado Cash to be used to break the law. Their contention was that if the technology is legal, then upgrades should be able to be made because it’s used by more than just criminals.

These arguments were premised on the fact that Tornado Cash is a legal, non-custodial protocol and that Storm’s work maintaining the software does not make him liable for criminal actors who also used the platform. His defense team has maintained since the original trial that he had no operational control over transactions and never intended for the protocol to be used by criminals. In addition, they argued that denying the acquittal would effectively criminalize the publication of decentralized software in violation of the First Amendment.

The prosecutors pushed back, arguing that Storm not only facilitated but also profited from money laundering through the protocol. Prosecutors allege that Tornado Cash processed more than $1 billion in illicit funds, including hundreds of millions linked to North Korea’s Lazarus Group.

Reactions from the Crypto Community

The OFAC’s sanctioning of Tornado Cash caused serious backlash in the crypto community and several notable figures in the industry have made comments and moves addressing the sanction and lawsuits that followed.

In October 2022, lawyers for Advocacy Coin Center, as well as crypto investor, David Hoffman, an anonymous human-rights advocate, and a software developer Patrick O’Sullivan filed a complaint against OFAC, Treasury Secretary Janet Yellen and OFAC Director Andrea Gacki. The complaint alleged that sanctioning Tornado Cash was “unprecedented and unlawful,” in part due to privacy concerns over crypto transactions. A pro-crypto member of the U.S. House of Representatives, Tom Emmer also wrote a letter to Treasury Secretary Janet Yellen questioning the move.

In August 17, 2023, Coinbase backed a suit filed by six individuals — Joseph Van Loon, Tyler Almeida, Alexander Fisher, Preston Van Loon, Kevin Vitale, and Nate Welch — alleging that the Treasury Department had exceeded its authority over foreign nationals’ interests in property and violated the Free Speech Clause by sanctioning Tornado Cash. The Treasury Department, on its part, argued that Tornado Cash is an entity that may be designated and that it has a property interest in the smart contracts.

Judge Pitman, who presided over the case, dismissed the plaintiffs’ arguments, ruling that Tornado Cash was “an entity that may be designated per the OFAC regulations,” and that its addition to a list of sanctioned entities did not exceed the Treasury Department’s statutory powers. The reasoning behind this ruling was that developers could analyze and teach the code behind the mixer but not “execute it and use it to conduct cryptocurrency transactions.”

In November 2024, an appeal was filed by the Plaintiffs, and on 21st January 2025, the US Court of Appeals for the fifth circuit reversed the OFAC sanctions against the crypto mixing protocol.

More recently, in April 2026, Amanda Tuminelli, the CEO of the DeFi Education Fund, following the hearing of the DOJ’s case against Roman Storm, opined that the government still does not understand the technology at issue, citing its lack of nuance and misinterpretations about Tornado Cash’s UI functions. She added that while Judge Failla had asked detailed questions, it is impossible to predict what her ruling would be, but that the case will potentially be scheduled for a retrial in late 2026.

Larger Implications for Privacy and Developments in Crypto

The Tornado Cash case has set a complex and controversial precedent. At the heart of the issue is the question of intent: should developers be held liable for how their code is used, even if it is open-source and decentralized?

This has cast a long shadow over crypto development, particularly in the privacy space. Developers now face increased uncertainty and legal risk, especially when building tools that could theoretically be used for both lawful privacy and unlawful concealment. Moreover, the case has reignited debates over code as speech. If writing code is a form of expression, can governments criminalize it based on how others use that code?

From a regulatory standpoint, the Tornado Cash case has forced authorities to reckon with the borderless nature of decentralized technologies. Traditional enforcement models are ill-suited to handle autonomous code that cannot be controlled by a single party.

While the Tornado Cash saga is is not yet over, its significance is already clear. The eventual decision of the court will likely set the tone for balancing innovation and regulation in the crypto privacy space would look like in the years to come. Regardless of the outcome, privacy remains a cornerstone of digital freedom, and unchecked anonymity can create safe havens for criminal activity.

Moving forward, what the industry needs is a more nuanced approach, one that recognizes the legitimate role of privacy tools while creating safeguards against abuse of those privacy tools and infrastructure in DeFi.

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And that’s a wrap! Thank you for reading today’s post and the final Issue in our case study series. Before you go, what do you think our next Volume will be focused on? Share your thoughts with us in the comments.

See you next time!⚖️✨

Yes, we know. It's been a minute. We've missed you too.

That's why today, we decided to bring you the complete details of one of the most famous crypto case stories in history — Nigeria's EFCC lawsuit against Binance and Tigran Gambaryan.

We know you'll find this detailed analysis of the case, covering the legal, economic and geopolitical factors that it involved, very insightful!

Dive right in as we recount the trajectory of this case and highlight some of it's most crucial takeaways.⚖️✨

“I wanted justice. And I still do.”

These were the words of Tigran Gambaryan, the former Head of Financial Crime Compliance at Binance, and a blockchain crime expert who was caught in the middle of the high-profile Binance-Nigeria legal dispute that came up in 2024.

For over a decade, Gambaryan had been known for his follow-the-money playbook to take down cybercriminals, and for the techniques he pioneered to trace cryptocurrencies on the Bitcoin Blockchain.

When Tigran joined Binance in 2021, it was with a view to strengthening the company's financial crime compliance amid growing regulatory scrutiny. However, the events that occured three years later involving his imprisonment within the shores of Nigeria were definitely not part of the plan.

At the time, Binance was already under investigation for facilitating illegal transactions, including money laundering, sanctions evasion, and dealings with terrorist groups, all of which were issues he was to assist in combating.

Binance’s Global Legal Issues

As of 2024, Binance faced mounting legal challenges in jurisdictions beyond just the USA, but worldwide. Some of these issues were:

• U.S. authorities fining Binance $4.3 billion for violating anti-money laundering laws;

• The UK, Europe, and Asia imposing strict regulations on cryptocurrency trading; and

• Nigeria accusing Binance of contributing to naira devaluation through unregulated crypto, leading to further scrutiny of the exchange.

The Unfolding of the Binance-Nigeria Dispute

The Binance-Nigeria case intertwines financial crime allegations, cryptocurrency regulation, and international diplomacy, highlighting key issues, including:

1. The Nigerian government's crackdown on cryptocurrency platforms amid currency devaluation;A

2. Allegations of bribery and legal overreach;

3. The role of U.S. diplomacy in securing Gambaryan’s release.

In December 2023, Nigeria’s National Assembly summoned Binance executives to discuss the impact of crypto on the Nigerian economy. Gambaryan, being Binance’s top investigator at the time and a former federal agent, represented the company.

At the meeting in Abuja, only three House members were present — a setting which Gambaryan alleged was curated with later “fake cameras and media to make the meeting appear official, but the cameras weren’t even plugged in.”

According to him, what seemed like friendly discussions quickly turned sinister when Nigerian Intelligence Operatives allegedly demanded a $150 million bribe to resolve Binance’s issues, threatening to prevent the team from leaving. Sensing danger, the Binance team fled Nigeria the next morning.

Gambaryan later received a call from a Nigerian agent (name withheld), who convinced him to return to Nigeria with promises that National Security Adviser Nuhu Ribadu would mediate in the matter.

Accompanied by Binance Africa’s regional manager Nadeem Anjarwalla, Gambaryan returned on February 25, 2024.

To their utmost shock, however, they were met with hostile officials and allegedly got detained at the office residence of Nuhu Ribadu for no less than a month!

Shortly after a month of detention, Anjarwalla escaped custody, leaving the authorities to clamp down on Gambaryan. They moved him to the EFCC detention facility in solitary confinement.

Some days after this move, his attorney informed him that he was being charged with money laundering, in addition to already existing charges of tax evasion.

On 4th April, Gambaryan's case commenced with a bail application, which was opposed by the prosecutors, citing Anjarwalla’s escape and arguing that Gambaryan was a flight risk. The judge declined to rule on the application, and he was moved to Kuje prison.

Gambaryan’s Health Crisis

Over the following months, Gambaryan’s health deteriorated dramatically. He contracted malaria and aggravated an old spinal injury, causing immense pain and temporary partial paralysis.

Despite court orders for medical treatment, Nigerian authorities allegedly flouted them repeatedly. The haphazard care he eventually received at Turkish-run Nizamiye hospital and a National Intelligence Agency facility did little to help.

Throughout this ordeal, Binance paid for his legal representation, sponsored freedom campaigns, and even bought him a cake for his 40th birthday. His wife Yuki was outspoken in calling on both governments to secure his release, launching a dedicated website to pool support. She tried to shield their children from the trauma. “This entire situation is inhumane and degrading, and I am fed up,” she said. “There must be consequences for this disregard of law and human rights.”

Legal and Human Rights Concerns

Several human rights organizations and legal experts criticized the manner in which this situation was handled by the Nigerian authorities. This criticism could be attributed to the grounds below:

Arbitrary Detention: Prior to him being charged to court, Gambaryan was detained under chaotic and impulsive circumstances. Under international law, this contravenes Article 9 of the International Covenant on Civil and Political Rights (ICCPR), which states that “No one shall be subjected to arbitrary arrest or detention.”

Inhumane Treatment and Conditions: During his imprisonment in Kuje Prison, Gambaryan faced severe health issues, including a near-fatal case of pneumonia, exacerbated by inadequate medical care and poor conditions of detention facilities. Such treatment violates the provisions of the Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment, which provides that detainees must not be subjected to torture or inhumane treatment.

Denial of Fair Trial: Reports indicate that Gambaryan was subjected to prolonged detention without a timely judicial review, and there were also allegations, by interested persons, (and even Gambaryan himself) of fabricated charges. This undermines the right to a fair and public hearing by a competent, independent, and impartial tribunal, as enshrined in Article 14 of the ICCPR.

International Interests at Play

The U.S. government expended significant human and material resources to secure Gambaryan’s release due in part to growing pressure put on them by high ranking officials.

The case attracted widespread attention in the U.S., leading to bipartisan congressional intervention. U.S. Congress members French Hill and Chrissy Houlahan visited Gambaryan in prison, where he described his dire conditions and struggles with malaria and pneumonia. Deeply moved, they promised to fight for his release and recorded a video at Abuja airport urging the embassy to push for his humanitarian release.

Congressman Rich McCormick argued that his case should be treated as a hostage situation under the Levinson Act, and 16 Republican lawmakers pressed the White House to intervene.

However, the Biden administration was initially ambivalent. Binance had just paid $4.3 billion in penalties to the Justice Department, and the administration had little love for the crypto industry.

To make it worse, Gambaryan’s detention came at a dangerous geopolitical moment. The U.S. ambassador to Nigeria had retired and the new one wasn't to arrive until May 2024.

Following these events, meetings between U.S. and Nigerian officials, and intensified efforts at getting Gambaryan released, the tax evasion charges were dropped.

The Turning Point: Nigeria Drops Charges

In October 2024, court proceedings on Gambaryan’s case were held in absentia, as he was reportedly too ill to attend the session. By the 23rd of October 2024, the EFCC dropped all money laundering charges against him, on health grounds.

His release documents were processed, he was U.S. State Department assistance, he boarded a private medevac jet arranged by Binance and returned to the U.S.

Following this, the White House released a statement noting that President Biden had called President Tinubu and shown appreciate for “President Tinubu’s leadership in securing the release on humanitarian grounds.”

A Deeper “Why”

Beyond the accusations of fraud and tax evasion levied against Binance and its agents, there lies a deeper consideration that fueled the actions of the Nigerian agencies involved in this case — economic concerns.

Around the time that the action was instituted in 2024, Inflation had reached 29.9% and the naira had lost 70% of its value, following President Tinubu’s relaxed foreign exchange restrictions introduced in May 2023.

As the naira continued to drop in value, many Nigerians flocked to cryptocurrencies, trading stablecoins peer-to-peer to preserve wealth. This further weakened the naira, and the government decided to restrict black market currency trading, but these changes amounted to no significant improvements.

Hence, government officials sourced for other plausible causes for this problem, and spotted Binance. They blamed the exchange for fueling currency speculation, especially in light of the fact that it was already viewed through the lens of suspicion across several other countries.

As the matter began to dial down, Nigeria’s government denied victimizing Gambaryan, insisting they only sought justice. In February 2025, Minister of Information Alhaji Mohammed Idris categorically denied the bribery allegations and urged the public to disregard Gambaryan’s “unsubstantiated” claims.

However, industry leaders even in Nigeria, believed that the execution was misguided. Senator Ihenyen, a lawyer, argued that Gambaryan, a crime fighter with valuable expertise, could have done more for Nigeria “in boardrooms and roundtables, not in detention.” He further suggested the EFCC could have prosecuted Binance as an entity without holding a non-executive officer.

Key Takeaways

This case highlighted the power of diplomacy in international business disputes. The U.S. intervention ultimately secured Gambaryan’s release, but Nigeria’s already questionable security operations was once again called into question.

Additionally, it must be understood that Nigeria’s aggressive approach in this case regulation was not very appealing to Fintech businesses and investors. Thankfully, we are evolving from this unattractive approach, and going forward, Nigeria must:

• Implement clear and fair regulatory frameworks.

• Collaborate with international financial crime experts.

• Balance monetary stability with technological innovation.

The case also showed how important it is for crypto exchanges to ensure high levels of transparency and compliance, in order to avoid legal pitfalls in foreign markets.

Bringing this to a close, the Binance-Nigeria dispute underscores the complex interplay between cryptocurrency, regulation, and geopolitics. While Nigeria sought to protect its economy, its handling of Gambaryan’s case raised concerns about its position on following due process and human rights violations.

Ultimately, this case serves as a critical lesson for global businesses navigating regulatory risks in emerging markets. It is our hope that Nigeria’s policies on cryptocurrency will continue to evolve, just as the industry itself does.

Welcome to this week's CRR, where we bring you the major news and updates on the legal, regulatory and policy developments in Crypto, DeFi and Blockchain Technology!

In case you're new here, here's a little intro to why CRR exists for you.👇🏾

The regulatory landscape of cryptocurrencies and blockchain technology encompasses a complex web of regulations, policies and legal frameworks.

Since the emergence of Bitcoin in 2008, policymakers and regulators have grappled with the unique challenges posed by these innovative industries. Governments worldwide have responded with varying degrees of acceptance, ranging from caution and restriction, to enthusiastic adoption.

As the industry continues to evolve, most countries across the world are still navigating the intricacies of legislation, regulation, and enforcement.

As this navigation continues, CRR exists to help you stay aware of these policies and what they could mean for you as a player in the industry.

We had quite a number of developments over the past week so brace yourself as we take you through the highlights across different segments.

Development in Regulatory Frameworks

Ethiopia bans P2P transactions

Ethiopia has once again reinforced its hard stance on cryptocurrency, this time explicitly banning peer-to-peer (P2P) crypto trades involving the local currency.

In a notice issued last Friday, the National Bank of Ethiopia prohibited residents from exchanging cryptocurrency for the Ethiopian birr, or vice versa, on P2P platforms without official authorization. Authorities say the move is part of tighter enforcement while a broader crypto regulatory framework remains under development.

In practice, the ban is unlikely to eliminate P2P trading. Past crackdowns in Ethiopia have failed to curb crypto use, instead driving activity underground and making oversight more difficult. This is at least the third time the central bank has announced similar restrictions, highlighting the limited effectiveness of earlier measures.

The NBE justifies its position on consumer protection grounds, pointing to price volatility, fraud risks, foreign-exchange pressures, and weaknesses in anti-money-laundering controls. Still, the repeated need for bans suggests demand for digital assets persists despite official disapproval.

Notably, the directive only targets birr-based P2P trades, leaving crypto-to-crypto transactions untouched. Looking ahead, the NBE says it is consulting international regulators and domestic stakeholders to draft formal rules aligned with global standards, though no timeline has been provided.

Crypto Holdings and Acquisitions

CFTC’s phantom letter to DeFi and its implications

A recent letter from the Commodity Futures Trading Commission has reportedly offered limited implications for decentralised finance. While this marks a regulatory win for the popular self-custody wallet, Phantom,

In the letter, the CFTC granted Phantom a no-action position for its plan to allow users to access regulated derivatives markets through a registered partner, including prediction market operator Kalshi. Phantom said it deliberately engaged regulators in advance to clarify how its non-custodial interface could connect users to regulated markets without requiring Phantom itself to register as an intermediary.

However, attorneys stress that the decision does not meaningfully advance DeFi. According to them, Phantom is merely acting as a front-end gateway to a custodial, regulated derivatives market, rather than enabling decentralised or self-custodial trading. As one lawyer put it, the arrangement is fundamentally custodial and therefore outside the core DeFi debate.

Phantom echoed this caution, noting the letter does not apply to DeFi derivatives or tokenised prediction markets. Still, the guidance was welcomed as a modest step forward. Coin Center policy director Jason Somensatto said it clarifies what neutral wallet interfaces may do, while Solana Policy Institute CEO Miller Whitehouse-Levine added that the broader principle could influence many other regulatory contexts.

Criminal Matters

Crypto scammer jailed for 6 years

A Moscow court has sentenced businessman Grigory Muluzyan to six years in prison for orchestrating large-scale cryptocurrency fraud that targeted several wealthy investors, including prominent Russian actor Pavel Derevyanko.

The Presnensky District Court found Muluzyan guilty of fraud “on an especially large scale,” ruling that he deceived clients by posing as a crypto investment expert. Prosecutors said victims handed over cash during meetings at his Moscow office after being promised guaranteed monthly profits from cryptocurrency investments.

The schemes ran from December 2021 to January 2023 and relied on false claims about exclusive tools and consistently profitable strategies. Derevyanko — a Golden Eagle Award winner for his role in the TV series House Arrest — reportedly gave Muluzyan about $3 million after selling property, according to RBC. Other victims included a professional boxer, a film director, and a married couple.

Although Muluzyan initially made payments disguised as interest, these soon stopped. Total damages were estimated at $4.6 million, with $1.4 million still missing despite partial repayments and an admission of guilt.

The conviction comes amid a wider crackdown on crypto-related crime in Russia, including recent violent robberies and warnings from All-Russia People’s Front about scammers exploiting fake humanitarian crypto appeals.

Thugs attack crypto professionals

French police have charged seven suspects over a violent kidnapping and torture plot targeting the parents of a cryptocurrency professional, following an attack in Haute-Savoie that demanded a ransom of more than $9 million.

According to investigators, the elderly couple were overpowered in their home near Sallanches, bound with industrial tape, and subjected to severe abuse. The retired doctor suffered a head injury, while his wife was slashed repeatedly with a box cutter, police told French newspaper Le Dauphiné Libéré. The attackers filmed the ordeal and sent the footage to the couple’s son, threatening further violence unless the ransom was paid.

After a two-day captivity, the victims were released on January 16 near Montélimar, in the Drôme region. Authorities have not confirmed whether any payment was made.

The case highlights a growing pattern of crypto-related kidnappings in France. Police are also pursuing suspects linked to similar attacks in Versailles and Saint-Genis-Pouilly. France’s National Prosecutor’s Office said all seven suspects—six men and one woman—are in custody, facing charges including organised crime, extortion, and money laundering, as investigations continue into possible accomplices.

Lawsuits and Court Rulings

Gemini sued over slumping stocks

Investors have filed a class-action lawsuit against Gemini and its billionaire founders, Cameron Winklevoss and Tyler Winklevoss, alleging the company misled the market ahead of its 2025 initial public offering.

According to the complaint, Gemini’s IPO filings portrayed the firm as primarily focused on expanding its crypto exchange business. Investors argue this was misleading, as the company soon pivoted sharply toward prediction markets, shut down operations in the UK, EU, and Australia, and laid off nearly a third of its workforce, including senior executives.

Since its September debut, Gemini’s stock has plunged about 82%, falling from $28 to roughly $5.82. In February, the company projected a net loss of up to $602 million in 2025. Plaintiffs claim these developments caused significant financial harm.

The lawsuit lands amid a broader slowdown in the crypto IPO boom. While crypto listings raised $3.4 billion in 2025, falling prices — with Bitcoin down nearly 50% since October — have forced companies such as Kraken to pause listing plans.

Beyond business troubles, the Winklevoss twins remain influential political donors, backing Donald Trump and reportedly shaping leadership decisions at the Commodity Futures Trading Commission.

Mood of the market

Bitcoin weakness deepens

After a strong start to the week, Bitcoin fell nearly 5%, moving in tandem with major risk assets such as the S&P 500, Dow Jones, Nasdaq, and even gold. In contrast, crude oil surged more than 7% in the same period and is now up over 50% since the outbreak of the US–Israel–Iran conflict in late February. This divergence reflects a broader, war-driven reallocation of capital away from risk assets toward energy and defensive exposures.

Data shows a widespread capital exodus across markets. Over the past three months, equity ETFs tracking the S&P 500 and Nasdaq 100 have seen a combined $64 billion in outflows—the largest on record—reversing the strong inflows recorded late last year. Crypto markets have mirrored this weakness, with spot Bitcoin ETFs losing $253 million in just two days, despite remaining marginally positive on a monthly basis. Overall flows, however, suggest investor confidence remains fragile.

On-chain data indicates that Bitcoin is struggling to absorb selling pressure amid heightened geopolitical uncertainty. Profit-taking briefly intensified before fading, coinciding with BTC slipping below $70,000.

With liquidity under pressure, energy costs rising, and risk sentiment subdued, many expect Bitcoin to enter a longer stabilization phase, with some projecting a potential bottom between $55,000 and $60,000 until geopolitical tensions ease.

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Development in Regulatory Frameworks

Democrats attack Trump on Crypto

Democratic lawmakers have intensified criticism of former President Donald Trump, accusing him of widespread conflicts of interest tied to the crypto industry. Before his death, Representative Gerry Connolly claimed Trump had over 100 conflicts of interest and described his crypto ties as “open corruption.” Lawmakers such as Maxine Waters and Stephen Lynch have also condemned Trump-backed legislation on stablecoins and CBDCs.

Representative Jamie Raskin alleged Trump transformed the Oval Office into a corrupt crypto enterprise that enriched his family within a year. The sharpest backlash has focused on World Liberty Financial, a DeFi project linked to Trump. Senator Elizabeth Warren labeled the project “corruption, plain and simple,” prompting Democrats to open a formal investigation. This followed a Wall Street Journal report that a UAE firm acquired a 49% stake in the project for $500 million shortly before Trump’s inauguration.

Despite the scrutiny, some experts argue the attacks may backfire. Lawyer Ishmael Green suggested the UAE investment aligns with US monetary interests. The White House has denied all allegations, with press secretary Karoline Leavitt insisting Trump’s crypto policies boosted innovation and economic opportunity.

South Korea plans to use AI for crypto tax enforcement

South Korea is accelerating plans to tax digital assets by deploying artificial intelligence to monitor cryptocurrency investment gains ahead of a long-delayed rollout in 2027. According to The Korea Times, the country’s tax authority has opened bids for an AI-powered system designed to analyze large volumes of crypto transaction data.

The project, valued at roughly 3 billion won ($2 million), will create a centralized platform capable of processing extensive trading records. Using AI and machine-learning tools, the system will flag unusual transaction patterns, uncover hidden income, and identify potential cases of tax evasion linked to digital asset trading.

The National Tax Service plans to select a contractor by March, begin system design in April, and conduct testing throughout the year. A pilot phase is scheduled for November, with full deployment expected in December.

Analysis results and lists of suspected offenders will be shared with other agencies, including the Korea Customs Service and the Bank of Korea.

South Korea’s crypto tax has been delayed multiple times since its approval in 2020 due to political and industry pushback. The current plan targets a January 2027 launch, imposing a combined 22% tax on annual crypto gains exceeding 2.5 million won.

Crypto Holdings and Acquisitions

Bitcoin tax controversy

As Bitcoin’s price slid, a quieter shift unfolded on Capitol Hill: a proposed crypto tax break once expected to include Bitcoin is now increasingly limited to stablecoins. Some Bitcoin advocates blame Coinbase.

Ten31 partner Marty Bent alleged that Coinbase lobbyists told lawmakers Bitcoin isn’t used for payments and pushed exemptions only for stablecoins like USD Coin. He cited unnamed sources. Coinbase executives swiftly rejected the claim, insisting they’ve long supported exemptions for all digital assets. Chief policy officer Faryar Shirzad called the accusation false, while CEO Brian Armstrong denied it in response to Jack Dorsey.

At issue is a “de minimis exemption,” which would spare small crypto payments from capital gains tax. Without it, even minor Bitcoin purchases trigger reporting to the IRS. According to the Bitcoin Policy Institute, recent drafts, such as the Parity Act discussion by Representatives Max Miller and Steven Horsford, limit relief to regulated stablecoins, excluding Bitcoin. This contrasts with earlier proposals from Senator Cynthia Lummis that covered Bitcoin.

The debate has been muddled by multiple competing tax proposals covering personal-use exemptions, gas fees, and stablecoin rules. Experts say differing priorities, not sabotage, explain the rift.

Ripple buys second Aussie firm

Ripple is nearing the completion of a deal to acquire a financial services license in Australia, strengthening its presence in the Asia-Pacific region. The license will be secured through the purchase of BC Payments, a subsidiary of European payments group Banking Circle. The transaction is expected to close in April 2026.

Ripple’s Asia-Pacific managing director, Fiona Murray, described Australia as a strategic market, noting that the company’s regional payment volumes doubled in 2025. Despite this expansion, XRP remains more than 60% below its all-time high recorded last summer, according to CoinGecko. The acquisition follows Ripple’s January purchase of Sydney-based Solvexia and reflects a decade-long growth strategy centered on acquisitions, though CEO Brad Garlinghouse has suggested dealmaking may slow in 2026.

Founded in 2012, Ripple initially positioned XRP as a liquidity tool for cross-border payments. After resolving a prolonged legal battle with the U.S. Securities and Exchange Commission in 2025 with a $125 million settlement, Ripple pivoted toward institutional services. Under its Ripple Prime brand, it acquired Hidden Road and several infrastructure providers, spending an estimated $2.5 billion on acquisitions last year.

Criminal Matters

Bithumb faces disciplinary actions

South Korean financial regulators have warned crypto exchange Bithumb to prepare for severe disciplinary measures after it was found to have breached anti-money-laundering rules. According to sources cited by Seoul Shinmun, the Financial Intelligence Unit (FIU), under the Financial Services Commission, is considering sanctions that could include a six-month suspension of services for new customers.

A Bithumb spokesperson said any restrictions would apply only to new users, while existing customers would continue trading, depositing, and withdrawing as usual. The looming penalties add to recent troubles for the exchange, including a high-profile internal error that mistakenly distributed billions of dollars’ worth of Bitcoin, and a separate probe by advertising regulators over allegedly misleading marketing claims.

The FIU inspection found that Bithumb had allowed transfers to unregistered overseas platforms and failed to properly enforce know-your-customer requirements. Similar compliance issues were reportedly uncovered across rival exchanges, including GOPAX and Coinone. The FIU is expected to announce its decision after a sanctions review meeting later this month.

Precedent exists: rival Upbit was hit with a three-month freeze on new customer registrations last year and is now challenging the move in court, with a ruling expected in April, according to Maeil Kyungjae.

The FIU may also discipline senior Bithumb executives. Bithumb’s 24-hour trading volume has risen 8% to $505 million, according to CoinGecko.

Police hunt suspects who allegedly posed as officers, stole $1M in Bitcoin

Police in the affluent Île-de-France commune of Versailles are searching for three men who forced a couple to transfer nearly $1 million in Bitcoin during a violent home invasion.

The attack occurred early Monday in the Le Chesnay district, where the victims, a man and woman in their late 50s, were deceived into opening their door by assailants posing as police officers, sources told TF1. Once inside, one attacker brandished a knife and threatened to stab the woman unless her partner sent Bitcoin to their wallet. The transfer was completed, after which the couple were tied up. The woman sustained a minor shoulder injury but later managed to free herself and alert a neighbour.

The Versailles prosecutor’s office has confirmed the crypto theft and said the case is being handled by the Banditry Repression Brigade, a specialist unit of France’s judicial police. No arrests have yet been made. Prosecutors are seeking charges including kidnapping, armed robbery, organised crime, and criminal conspiracy.

The incident reflects a broader surge in crypto-related kidnappings across France. Authorities say around 40 such cases were recorded between mid-2023 and the end of 2025, often orchestrated by overseas criminal networks. Recent cases include a failed attack targeting Binance’s France chief, as well as several brutal kidnappings involving elderly victims. Experts warn that violence linked to crypto theft is likely to intensify further in 2026.

Crypto Kidnappings

French police have intensified their crackdown on crypto-related kidnappings, arresting 12 suspects in Lyon linked to the abduction of a Swiss crypto holder last August. The arrests follow a dramatic raid that freed a 22-year-old man after he was held captive for four days while his captors demanded a ransom in cryptocurrency, according to France Info.

Police said the detentions were the result of months-long investigations that have now identified around 20 additional suspects with varying degrees of involvement. The victim, who lives in Switzerland’s Vaud canton, was targeted because of his known crypto holdings and was “seriously mistreated and injured” during the ordeal.

The rescue operation, led by prosecutors in Lyon, took place on August 31, when around 150 heavily armed personnel stormed a building near Valence train station in the Drôme region. Three suspects, including one alleged mastermind, were arrested at the scene. Further arrests followed in early September and again on March 2, bringing the total number detained in connection with the case to dozens. Several suspects were already known to police, and one was a minor.

Prosecutors have charged those indicted with kidnapping, unlawful confinement, extortion, organized crime, weapons offenses, and criminal conspiracy. The case comes amid a broader surge in crypto kidnappings in France, as authorities warn that many such crimes are orchestrated by overseas criminal networks.

Lawsuits and Court Rulings

Binance files defamation suits

Binance has filed a defamation lawsuit against The Wall Street Journal, challenging a February report alleging it dismissed compliance staff after they identified more than $1.7 billion in cryptocurrency linked to sanctioned entities flowing through the platform. Binance claims the reporting was driven by malice, rushed for clicks, and ignored its responses. The exchange is seeking a jury trial. The Journal has stood by its reporting.

The lawsuit comes amid broader scrutiny. Multiple outlets, including Fortune and The New York Times, have reported that Binance ignored or penalized internal warnings about transactions tied to Iranian-linked groups, such as the Islamic Revolutionary Guard Corps and the Houthis. Binance strongly denies these claims. It says staff were dismissed for data protection breaches, not for raising compliance concerns, and that flagged users were removed from the platform.

Meanwhile, the Journal reported that the Department of Justice is investigating Iran’s alleged use of Binance to evade sanctions; an assertion Binance says it is unaware of. The controversy strikes at the core of Binance’s $4.3 billion 2023 settlement, after former CEO Changpeng Zhao pleaded guilty to compliance failures. Adding political pressure, Senator Richard Blumenthal has launched a Senate investigation, calling Binance a “repeat offender,” a charge the company says is based on false and defamatory reporting.

China’s Supreme Court lashes out against crypto criminals

China’s Supreme People’s Court has announced a tougher stance on the use of cryptocurrency for money laundering and illegal cross-border fund transfers, signalling a renewed crackdown on crypto-enabled financial crime. The warning was delivered by Chief Justice Zhang Jun during the court’s annual work report to the National People’s Congress, amid growing concern over technology-driven criminal activity.

Chinese courts are increasingly dealing with sophisticated offences, ranging from artificial-intelligence-powered fraud to “human flesh search” campaigns—large-scale online doxxing operations that mobilise thousands of users to expose private information. Against this backdrop, the court reaffirmed a zero-tolerance approach to crypto-facilitated crimes, underscoring the state’s continued reluctance toward widespread cryptocurrency use.

The move follows findings by Chainalysis, which revealed in January 2026 that Chinese-language laundering networks have handled roughly 20% of global illicit crypto flows over the past five years. Enforcement has steadily intensified since Beijing banned crypto trading and mining in 2021, even as criminals exploit digital assets to bypass China’s strict $50,000 annual capital-outflow limit.

The court stressed that innovation remains welcome, but only within legal boundaries, noting that emerging technologies must develop in a regulated and standardised manner.

Mood of the Market

CFTC issues guidance for market operators

The Commodity Futures Trading Commission’s Division of Market Oversight has issued a new advisory addressing how prediction markets list event contracts. The guidance reminds regulated platforms of their obligations under the Commodity Exchange Act, emphasizing the need to prevent contracts that are highly susceptible to manipulation. In particular, the advisory cautions against event contracts tied to easily influenced outcomes, such as sports-related contracts that settle based on an athlete’s participation, where insider knowledge or strategic behavior could distort market integrity.

Speaking to CNBC, CFTC Chair Rostin Behnam underscored the urgency of establishing clearer regulatory standards as prediction markets attract broader public interest. He noted that well-defined “rules of the road” are essential to curb risks such as manipulation, insider trading, and other forms of market abuse.

Separately, the CFTC announced it is seeking public comment on whether existing regulations governing event contracts remain adequate or should be amended. This consultation signals the agency’s openness to refining its regulatory framework in response to the rapid growth of prediction markets.

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Development in Regulatory Frameworks

Ripple CEO supports Trump in passing the Clarity Act

Brad Garlinghouse, CEO of Ripple Labs, called on US lawmakers to pass the proposed Clarity Act. Garlinghouse praised Donald Trump for urging legislators to pass the bill.

Banks and crypto companies are disputing stablecoin rules. While the earlier Genius Act prohibited paying interest directly on stablecoin holdings, some firms have introduced alternatives. For example, Coinbase offers users incentives on stablecoins through a rewards program tied to its subscription service, Coinbase One. Banking groups want stricter wording in the Clarity Act to close such loopholes.

The legislation aims to clarify whether cryptocurrencies should be classified as securities or commodities, depending on their level of decentralization. Under the proposal, sufficiently decentralized assets would fall under the oversight of the Commodity Futures Trading Commission, while others would remain under the US Securities and Exchange Commission.

Major banks warn that allowing stablecoin rewards could trigger large deposit withdrawals, potentially shifting hundreds of billions of dollars from traditional banks into crypto platforms.

Crypto is becoming a great divorce issue, says Russian lawyers

Russian divorce courts are increasingly facing disputes over cryptocurrency holdings. According to family lawyer Anastasia Madi of Kislov Law, assets like Bitcoin and altcoins pose serious challenges during divorce proceedings.

Although Russian law was amended in 2020 to recognize cryptocurrency as intangible property—making it eligible to be treated as marital property—practical challenges remain. Courts typically measure the value of assets in fiat currency, so specialists are often required to estimate the value of digital assets. However, proving ownership of crypto can be difficult because it is stored in wallets protected by private keys and passwords.

If one spouse hides these credentials or transfers the funds to another wallet during divorce proceedings, lawyers may struggle to demonstrate that the assets exist. In some cases, courts may decline to divide the crypto due to insufficient evidence. For example, a court in Krasnodar rejected a woman's claim to shared crypto holdings because she could not prove their existence.

Lawmakers are considering solutions. A proposed bill suggests that cryptocurrency acquired during marriage should be classified as joint property, while assets obtained before marriage or received as gifts would remain the owner's personal property.

Nigeria calls for stronger crypto regulation

Corporate Affairs Commission (CAC) officials called for stronger regulatory supervision of cryptocurrency platforms operating in Nigeria. Speaking in Lagos, CAC Ambassador Micheal Nwabufo called on digital asset service providers to strictly comply with the rules and guidelines issued by the Securities and Exchange Commission Nigeria (SEC).

Nwabufo warned that the growing number of unregulated crypto platforms poses serious risks to investors and threatens the credibility of Nigeria's digital financial ecosystem.

The CAC representative further urged crypto vendors and blockchain-related businesses to adopt responsible operational practices and maintain proper registration where required. Strengthening regulatory discipline, he noted, will not only safeguard investors but also promote sustainable innovation and long-term growth within Nigeria’s digital asset sector.

Crypto Holdings and Acquisitions

Reform UK bags huge crypto donation

Nigel Farage received a £3 million political donation from crypto investor and aviation entrepreneur Christopher Harborne. The contribution helped Farage's Reform UK surpass both the Labour Party and the Conservative Party in donations for the fourth quarter.

Harborne had previously donated £9 million to Reform UK in August, and his latest contribution helped the party reach £5.5 million in total donations during the period. In comparison, the Conservatives raised about £2.3 million while Labour secured roughly £1.7 million, according to the Financial Times.

Reform UK became the first British political party to accept donations in cryptocurrencies such as Bitcoin in May. Since then, some lawmakers have urged restrictions on crypto donations, warning they could increase the risk of foreign interference in British politics. Concerns intensified following the conviction of Nathan Gill for taking bribes linked to pro-Russia activities.

Farage has promised to transform the United Kingdom into a global crypto hub if he gains power, echoing pro-industry policies supported by Donald Trump.

Brazilian regulators demand daily guarantee of crypto exchange holdings

Brazilian regulators have announced stricter rules that will require cryptocurrency exchanges to meet the same security and liability standards as traditional financial institutions. Under a resolution issued by the country’s central bank on February 27, licensed crypto trading platforms will soon be required to submit daily reports proving they have enough reserves to cover potential losses caused by hacks or data breaches. The regulations also mandate that exchanges follow the same data protection and confidentiality requirements applied to Brazilian commercial banks.

According to Denis Medina, a professor at the Faculty of Commerce of São Paulo, the new measures will increase investor protection while strengthening the overall financial system. He explained that tighter regulations could help reduce crypto-related crimes, including money laundering and tax evasion.

Most of the new rules are scheduled to take effect on January 1, 2027. One key provision introduces a formal accounting framework for crypto exchanges and digital payment firms, allowing them to record digital assets directly on their balance sheets rather than converting their value into fiat currency.

Additionally, exchanges must separate their own funds from customers’ crypto and fiat holdings by maintaining distinct accounts and wallets. The regulations will also introduce stricter monitoring of transactions, especially transfers to foreign exchanges. Authorities say these measures will improve traceability in crypto transactions and make it harder for criminals to use digital assets for illicit activities such as drug trafficking or terrorism financing.

Criminal Matters

Crypto robbers jailed for 5 years

A court in Omsk Oblast has sentenced three young men to five years in prison after they were convicted of attempting to rob a victim of cash and cryptocurrency. The Leninsky District Court in Omsk handed down the sentences on March 3.

The attack occurred on April 10, 2024, after an accomplice courier who had previously delivered a package to the victim’s address tipped off the attackers about his crypto holdings. CCTV footage showed the masked suspects approaching the apartment at night and forcing entry after tricking the victim into opening the door.

Prosecutors said the trio forced their way into the victim’s apartment, threatened him with a knife, and physically assaulted him while demanding access to his cryptocurrency and money.

The assault ended when a neighbour became suspicious and investigated the noise, causing the attackers to flee empty-handed. The court convicted them and ordered them to serve their sentences in maximum-security penal colonies and pay the victim over $5,000 in damages. Their alleged courier accomplice is currently being tried separately.

Authorities nab suspect accused of $46M crypto theft

FBI Director Kash Patel announced that a suspect accused of stealing $46 million in cryptocurrency from the United States Marshals Service has been arrested.

The suspect, John Daghita, was apprehended on the Caribbean island of Saint Martin during a joint operation involving the FBI and the French Gendarmerie's elite tactical unit. Daghita, a U.S. government contractor, allegedly diverted millions of dollars in digital assets held by the Marshals Service.

Blockchain investigator ZachXBT raised concerns about the alleged theft in January. Daghita may have accessed the funds through connections to his father's IT firm, Command Services and Support, a Virginia-based company that secured a $4 million contract with the Marshals Service in 2024.

ZachXBT published evidence suggesting Daghita controlled multiple cryptocurrency addresses and linked the funds to assets previously seized by the government

Lawsuits and Court Rulings

Uniswap wins ‘scam tokens’ lawsuits

A US federal judge has dismissed the final claim in a class-action lawsuit against the creators of the decentralized exchange Uniswap.

The lawsuit, filed in 2022, was brought by traders who said they lost money after purchasing "scam tokens" on the platform. However, those tokens were not created by Uniswap, and their issuers remain unidentified. Judge Katherine Polk Failla stated that the plaintiffs could not hold the defendants responsible for the actions of unknown third-party token creators.

The case involved traders from North Carolina, Idaho, New York and Australia who accessed the protocol through a website run by Uniswap Labs. They claimed the platform acted as an unregistered broker-dealer and facilitated fraudulent trades involving 38 tokens.

The court rejected these arguments, saying such regulatory concerns should be addressed by lawmakers. Uniswap founder Hayden Adams welcomed the decision, arguing that scammers—not open-source developers—should bear legal responsibility.

Russia plots Stablecoin bill

The Ministry of Finance is considering a separate bill specifically for stablecoins. According to Alexey Yakovlev, Director of the Ministry's Department of Financial Policy, stablecoins possess "enormous—almost colossal—potential." The government prefers to regulate fiat-pegged digital assets through a standalone law instead of including them in the broader legislation that will govern cryptocurrency exchanges.

Officials say stablecoins could help Russia navigate international sanctions.

The stablecoin legislation is expected to follow passage of a bill prohibiting Russians from trading on unlicensed platforms. That measure could take effect in July.

The central bank has already introduced the category "foreign digital rights," which can include certain cryptocurrencies and stablecoins. The first approved asset under this category was the ruble-pegged A7A5 stablecoin, authorized in October for use in international trade.

Mood of the Market

The effect of the US & Israel war against Iran on Bitcoin

Geopolitical conflict in the Middle East could act as a bullish catalyst for Bitcoin, according to analysts from the London Crypto Club. In their weekly newsletter, analysts David Brickell and Chris Mills argued that escalating tensions between the United States, Israel, and Iran could provide the narrative boost Bitcoin has been waiting for.

Following recent strikes on Iran that reportedly killed Ali Khamenei, Bitcoin briefly rose above $69,000 before settling near $67,000. The cryptocurrency remains about 47% below its October peak of $126,000. However, investor demand appears strong, with roughly $458 million flowing into Bitcoin exchange-traded funds at the start of March, according to DefiLlama.

Brickell and Mills outlined two possible scenarios. In a prolonged conflict, markets could enter an “extreme risk-off” phase, pushing investors toward perceived safe-haven assets such as Bitcoin and gold. Alternatively, if the conflict ends quickly and Donald Trump announces a peace agreement, renewed optimism could trigger a surge in Bitcoin buying.

In both cases, the analysts expect increased liquidity as the Federal Reserve injects money into the financial system to support economic stability.

Similarly, Arthur Hayes argues that U.S. military engagements typically lead to government spending and monetary expansion, conditions that historically support Bitcoin and other risk assets.

Following a high-stake, litigious courtroom drama that lasted nearly five years, from 2020 to 2025, the legendary legal battle between Ripple Labs and the U.S. Securities and Exchange Commission (SEC) over the XRP token has emerged as a fundamental piece of the growing crypto case law puzzle — one that ended with a resolution which now arguably stands as the regulatory North Star for the digital assets industry.

The Backstory

Founded in 2012, Ripple Labs has been one of the world's leading blockchain companies involved in developing blockchain-based solutions for global cross-border payments for over a decade. The company was launched by three engineers who developed the XRP Ledger (XRPL) with the goal of creating a faster, cheaper, and more energy-efficient alternative to Bitcoin.

Unlike Bitcoin’s proof-of-work system, the XRPL functions with the Ripple Protocol Consensus Algorithm, also referred to as a Federated Byzantine Agreement. This mechanism relies on a supermajority consensus rather than mining, enabling the network to process approximately 1,500 transactions per second — a speed significantly faster than Bitcoin’s 3–7 transactions per second, at the time.

In addition to its speed, transaction fees on the XRPL are also are minimal fractions of a dollar. All of these features made the $XRP — Ripple’s native token which was created as a bridge currency for international and cross-border payments — particularly attractive for high-volume financial institutions and the investing crypto community and by 2017, $XRP became one of the top 5 tokens listed on most crypto exchange platforms.

However, the $XRP was designed with a focus on utility, because Ripple had always been particular about building useful tech, advancing DeFi principles, the tokenization of real-world assets (RWAs), and generally expanding the blockchain’s use cases beyond simple value transfer. This is a crucial point to note as it forms the basis of a major issues raised in determining whether the XRP token could be classified as a security.

Trajectory of the Legal Tango

Despite its technological successes, Ripple faced notable controversies. In 2015, the company was fined $700,000 for violations of the Bank Secrecy Act, becoming the first virtual currency provider to face civil enforcement action in the United States. Ripple also had to reach a settlement with the U.S. Department of Justice over Anti-Money Laundering (AML) compliance failures.

By 2019, a blockchain analytics firm, Elliptic was engaged to monitor XRP transactions for criminal activity. The firm reported that approximately $400 million in XRP had been linked to illicit use. Additional controversy followed in 2020 with cyberstalking charges brought against Ripple board member Ken Kurson.

However, the icing on the cake came in December 2020, when the U.S. SEC’s court case against Ripple Labs officially began. The SEC had alleged that Ripple had conducted an “unregistered securities offering” through the sale of $XRP, claiming that Ripple raised approximately $1.3 billion through $XRP sales, in violation of the Securities Act of 1933.

Additionally, the SEC alleged that Ripple’s co-founder, Chris Larsen and CEO, Bradley Garlinghouse had personally profited by selling these unregistered securities, earning roughly $600 million since 2013.

The SEC based these allegations on its position that $XRP sales constituted investment contracts under the Howey Test, which defines a security as an investment involving money in a common enterprise with an expectation of profit derived from the efforts of others, as properly discussed in our previous issue here.

The case involved a lot of back and forth which significantly affected the price and market cap of the $XRP token, and by July 2023, U.S. District Judge Analisa Torres delivered a split ruling. The court held that $XRP itself was not a security, but that Ripple had unlawfully sold $728.9 million worth of $XRP to institutional investors.

Hence, the focus of the court in terms of securities law violations, was on institutional investors, and Ripple’s programmatic sales of $XRP to retail investors (typical crypto chads), for employee compensation, or as third-party developer incentives did not meet the criteria of the Howey Test and as such, were found not to violate securities laws.

Following this decision, Ripple was fined $125 million, substantially lower than the $2 billion penalty sought by the SEC, and this ruling was widely viewed as a partial victory for the crypto industry, as it provided much-needed clarity on digital asset classification. However, the SEC was not done.

By October 2024, the SEC attempted to appeal the decision, drawing criticism from the crypto community, but this and several other attempts to appeal after, were all rejected by the court. Hence, the decision given by Judge Torres, favoring Ripple’s long-term survival, stands as the final, unappealable conclusion on the matter.

Notably, this period coincided with 2024 U.S. election period, where President Donald Trump, known for his crypto-friendly posture, enjoyed wide endorsements from the industry key players — a factor which significantly contributed to his eventual success in the elections. The Trump administration has undeniably spearheaded favorable policies for the industry, such as the Cryptocurrency Executive Order issued by Trump in 2025 to clarify policies on mining, exchange-traded funds (ETFs), and the creation of a strategic federal digital asset reserve, and more recently, discussions around the GENIUS and CLARITY Acts.

Post-Lawsuit Growth and a Future Outlook

After the final judgment and eventual settlement fees of $125 million which the court ordered Ripple to pay, both parties filed a joint stipulation to dismiss all remaining appeals on August 7, 2025; permanently closing the case, removing the legal overhang that had suppressed the $XRP token’s growth for years, and establishing a legal distinction between different types of token sales.

As of 2026, Ripple has launched its RLUSD stablecoin, expanded the XRP Ledger’s (XRPL) role in real-world asset (RWA) tokenization, and the $XRP token has re-emerged as one of the most closely watched altcoins in the market, now sitting at the intersection of regulation, payments infrastructure and high-risk speculation.

With absolute legal clarity achieved, Ripple’s victory has further paved the way for its institutional adoption through ETFs (Exchange-Traded Funds), which are investment fund products that offer diversification by holding a basket of securities — stocks, bonds, or commodities, tradeable on a stock exchange like a single share. In November 2025, the first U.S. Spot XRP ETFs received regulatory approval, leading to an initial surge in institutional inflows that peaked at over $1.2 billion in assets under management by early 2026.

Although the market faced a correction in February 2026 — with the XRP token trading around $1.40 after a 2025 high of $3.65 — the presence of these regulated investment vehicles has fundamentally changed the token’s liquidity profile and reduced its long-term volatility.

The token distinction established in this case now serves as the primary defense for dozens of other crypto projects, effectively shielding secondary market participants from being classified as securities traders.

Ripple’s legal battle with the SEC has undoubtedly shaped the regulatory future of cryptocurrencies in no small way. As governments, regulators, and financial institutions worldwide grapple with emerging technologies at the intersection of blockchain, AI, and digital currencies, the Ripple Playbook may well serve as a blueprint for the next phase of global financial technology.

Hi Legal DeFiers! It's the weekend. And as you know it, Crypto report is here.

From Nigeria and South Africa gradually emerging as Africa's leading growth hubs for stablecoins, we have the details of the new trial motion moved by Bankman-Fried.

Defamation suits and terrorism claims? Present!

Development in Regulatory Frameworks

A spot exchange launches in Australia

As regulatory clarity reshapes global crypto markets, established financial firms are moving decisively into digital assets. Frameworks such as the European Union’s Markets in Crypto-Assets Regulation, heightened enforcement in the United States, and clearer licensing regimes in Australia have shifted industry focus from rapid expansion to infrastructure, accountability, and long-term credibility.

Against this backdrop, Global broker Pepperstone has launched a regulated spot cryptocurrency exchange in Australia, marking a notable point of convergence between traditional finance and crypto markets. Operating as Pepperstone Crypto, the platform applies the firm's 16 years of experience in forex, CFDs and multi-asset trading to digital assets, extending established risk management and compliance standards into the crypto space.

Pepperstone Crypto's Australian rollout offers spot trading with a flat 0.1% fee for both makers and takers. This simplified pricing model removes cost ambiguity while leveraging the firm's existing global trading infrastructure for consistent execution.

Operational resilience also remains central. As volatility persists, traders expect platforms to perform reliably during intense market activity. Pepperstone Crypto operates under Australian regulatory oversight and is registered with Australian Transaction Reports and Analysis Centre, reinforcing confidence through clear governance and compliance.

The platform currently supports major spot trading pairs alongside AUD deposits and withdrawals, with plans to expand asset coverage over time.

UK SEC urges temporary ban on crypto political donations

UK lawmakers are intensifying scrutiny of cryptocurrency donations to political parties amid growing concerns about foreign interference ahead of future elections.

The debate follows a move by Reform UK, which became the first British party to accept crypto donations in May last year. Party leader Nigel Farage publicly confirmed that the group would accept Bitcoin and other digital assets from eligible donors.

However, Matt Western, chair of the Joint Committee on the National Security Strategy, has called on the government to pause such donations. In a letter to Steve Reed, Western urged the introduction of a temporary moratorium on crypto donations within the forthcoming Representation of the People Bill, to remain in place until statutory guidance is issued by the Electoral Commission.

Western warned that as the UK’s strategic and military role in Europe expands, incentives for foreign actors to influence British political finance—particularly on issues such as Ukraine or transatlantic relations—are likely to increase. Earlier this year, Western and other committee chairs pushed for a full ban on crypto donations, though this was excluded when the bill entered Parliament.

He further proposed stricter rules, including limiting donations to crypto services registered with the Financial Conduct Authority, banning funds linked to mixers or anonymous sources, and requiring parties to convert crypto donations into fiat within 48 hours.

Western also advocated for a dedicated national police body to oversee political finance, alongside tougher penalties, source-of-wealth checks for donors and expanded enforcement powers to counter foreign interference.

Nigeria & South Africa lead stablecoin surge

Nigeria and South Africa are emerging as Africa’s leading growth hubs for stablecoin adoption, with close to 80% of surveyed cryptocurrency users in both countries already holding dollar-pegged digital assets.

The data comes from the latest Stablecoin Utility Report by YouGov, produced in collaboration with BVNK, Coinbase and Artemis. The survey covered more than 4,650 respondents across 15 countries who either currently hold or plan to hold cryptocurrencies.

Over three-quarters of respondents in both countries said they expect to increase their stablecoin holdings within the next year. Nigeria stood out in particular, with roughly 95% of respondents indicating a preference to receive payments in stablecoins rather than the naira.

Stablecoins now have a total market capitalization exceeding $300 billion as of February 2026.

Adoption in both countries appears driven by utility rather than speculation. Respondents cited faster settlement, lower transaction costs and greater reliability compared with traditional banking and remittance systems. As BVNK co-founder Chris Harmse noted, users are increasingly earning, spending and seeking deeper integration of stablecoins into everyday financial tools where conventional payments fall short.

Crypto Holdings and Acquisitions

U.S SEC receives filing for JitoSOL

Nasdaq has filed a proposed rule change to list and trade the VanEck JitoSOL ETF, marking the first U.S. Securities and Exchange Commission (SEC) exchange filing for an exchange-traded product (ETP) holding a liquid staking token. The proposed fund, sponsored by VanEck, would hold JitoSOL, a Solana-based liquid staking token created by the Jito Network.

Liquid staking allows users to stake tokens to secure a proof-of-stake blockchain while receiving a transferable token representing the staked assets and accumulated rewards. According to Jito Foundation president Brian Smith, staking rewards would not be paid out separately if the ETF is approved, but instead would be reflected in the fund’s net asset value, as JitoSOL automatically compounds yield.

The proposal was submitted under Nasdaq Rule 5711(d), which governs commodity-based trust shares, and seeks approval for a trust that would hold JitoSOL directly. Share valuation would be based on the MarketVector JitoSOL VWAP Close Index, with both cash and in-kind creations and redemptions permitted.

The SEC has up to 45 days—extendable to 90 days—to make a decision following Federal Register publication.

MetaMask partners with MasterCard

ConsenSys, a leading Ethereum development firm and the creator of MetaMask, has announced the nationwide rollout of the MetaMask Card across the United States, including New York.

The MetaMask Card allows U.S. users to spend self-custodied crypto assets anywhere Mastercard is accepted. Powered by Mastercard and issued by Cross River Bank, the card lets users retain full control of their digital assets until the exact moment of purchase.

Cardholders earn onchain crypto rewards with every transaction—up to 1% cashback for standard users and up to 3% for premium metal cardholders. Unspent balances can also generate yield when held in supported interest-bearing tokens such as aUSDC from Aave.

To mark the launch, MetaMask has also unveiled the MetaMask Metal Card, a premium option available for a $199 annual subscription.

Criminal Matters

South Korean police lose $1.4M in Bitcoin

South Korean authorities have arrested two individuals after 22 Bitcoin, now valued at about $1.4 million, went missing from police custody due to serious procedural failures.

The Bitcoin was seized in November 2021 following a hack on a local cryptocurrency exchange. Seized digital assets are required to be stored in a cold wallet fully controlled by law enforcement. Instead, investigators discovered that the funds were placed in a third-party cold wallet linked to individuals connected to the hacking case. That third party retained access to the wallet’s seed phrase, while the police themselves reportedly did not know it.

According to a report by Dong-A Ilbo, an official from a company with access to the seed phrase later handed it to a person known as “Mr. Jeong” as part of a private borrowing arrangement, leading to the unauthorized withdrawal of the funds.

The case is further complicated by the conviction of a police investigator involved in the original exchange hack, who was sentenced in August 2025 for accepting bribes to influence the investigation. The loss remained undetected for four years and only came to light during a nationwide audit triggered by the disappearance of 320 BTC in a separate case at the Gwangju District Prosecutors’ Office.

Telegram CEO faces allegations of terrorism facilitation

Russian authorities have launched a criminal investigation into Telegram co-founder and CEO Pavel Durov, accusing the messaging platform of facilitating terrorist activity after it allegedly refused to remove large volumes of illegal content. The investigation was reported by state outlet Rossiyskaya Gazeta. Kremlin spokesperson Dmitry Peskov confirmed that the case is based on FSB materials.

Media watchdog Roskomnadzor tightened restrictions on Telegram in early February. State-linked outlet Komsomolskaya Pravda reported that Telegram failed to remove nearly 155,000 channels, chats, and bots flagged by authorities. These allegedly include content spreading false information, promoting or justifying extremism, and facilitating drug activity.

Former Kremlin internet adviser German Klimenko warned the probe could result in Telegram being labeled an extremist platform, potentially criminalizing payments for Telegram Premium and advertising.

Durov confirmed the investigation in a post on X, accusing Russian authorities of using fabricated pretexts to restrict access to Telegram and undermine privacy and free speech. He argued the pressure is intended to push users toward a state-backed alternative messenger, insisting Telegram will continue to defend user privacy despite government pressure.

Binance CEO lays defamation claims

Binance denied media reports alleging that it dismissed or suspended employees after internal investigators uncovered large crypto transfers to Iranian-linked entities. Binance CEO Richard Teng accused the Wall Street Journal of publishing “false and defamatory” claims, specifically rejecting assertions that investigators found up to $1.7 billion in digital assets flowing to networks tied to Iran-backed groups.

In a post on X, Teng shared a letter from Binance’s lawyers at Withers Bergman demanding corrections and a full retraction, arguing that the article misled readers and ignored Binance’s responses. The disputed report, written by WSJ journalists Patricia Kowsmann, Angus Berwick, and Ben Foldy, claimed executives removed investigators who raised concerns about sanction violations.

A separate article by the New York Times echoed similar allegations, stating that several investigators were fired or suspended after identifying potential sanction breaches involving Iranian entities. Fortune also published comparable claims in mid-February, which Binance again rejected as “categorically false.”

The controversy has drawn political attention. US Senator Richard Blumenthal has reportedly opened an inquiry, seeking records related to transfers involving two Hong Kong entities.

Meanwhile, former Binance CEO Changpeng Zhao recently appeared at a crypto forum hosted by World Liberty Financial, a company linked to Donald Trump, following Zhao’s 2023 plea deal, prison sentence, and subsequent presidential pardon.

Lawsuits & Court Rulings

US lawmakers move to protect Blockchain development

A bipartisan group of US House lawmakers has introduced the Promoting Innovation in Blockchain Development Act, aiming to protect software developers who do not control others’ crypto assets from criminal prosecution. Representatives Scott Fitzgerald, Ben Cline, and Zoe Lofgren said the legislation would clarify that Section 1960 of federal law—prohibiting illegal money transmitting businesses—applies only to those handling others’ funds.

The bill has received backing from crypto advocacy groups. The Blockchain Association called it a “critical step” for US-based developers, while the DeFi Education Fund (DEF) said it could prevent prosecutions like those faced by Tornado Cash developer Roman Storm and Samourai Wallet founders Keonne Rodriguez and Will Lonergan Hill. DEF emphasized that developers building neutral technology without custody of funds should not risk being treated as financial intermediaries.

Storm was convicted in August 2025 for running an unlicensed money transmitter, while Rodriguez and Hill were sentenced to four and five years, respectively, after pleading guilty.

In the Senate, Senators Cynthia Lummis and Ron Wyden proposed the Blockchain Regulatory Certainty Act to similarly shield developers from liability. Meanwhile, broader digital asset legislation, including the CLARITY Act, awaits full Senate consideration, with developer protections still debated among lawmakers.

Bankman-Fried’s new trial motion

Convicted former FTX CEO Sam “SBF” Bankman-Fried continues to pursue legal avenues. In a recent filing in the US District Court for the Southern District of New York, Judge Lewis Kaplan set a March 11 deadline for the US government to respond to Bankman-Fried’s motion for a new criminal trial.

Bankman-Fried, convicted in November 2023 on seven felony counts and sentenced to 25 years in prison in March 2024, argues that new witness testimony could strengthen his case. His appeal of the conviction and sentence remains pending before the US Court of Appeals for the Second Circuit.

Bankman-Fried resigned as FTX CEO in November 2022 amid the company’s collapse and faced charges over misuse of user funds. Former Alameda Research CEO Caroline Ellison, who testified against him under a plea deal, was released in February 2026 after 440 days in custody, while former FTX Digital Markets co-CEO Ryan Salame is serving a seven-and-a-half-year sentence.

Since imprisonment, SBF has publicly supported President Donald Trump, claiming political bias influenced his case. The White House has confirmed that Trump is not considering a pardon, though he has previously pardoned other crypto figures, including Changpeng Zhao and Silk Road founder Ross Ulbricht.

Mood of the Market

Crypto surges after brutal start to 2026

Crypto markets rebounded after a punishing start to 2026. The market found a short-term bottom, sparking a wave of buying that liquidated over $400 million in open short positions within 24 hours. Many altcoins are now posting double-digit gains.

Interestingly, this rally is being led by smaller-cap and less-popular assets, with Polkadot (DOT), Aptos (APT), and Cardano (ADA) outpacing favorites like Solana (SOL), Ethereum (ETH), and Bitcoin (BTC). Retail favorite Hyperliquid (HYPE), meanwhile, lags behind.

The shift in price action suggests speculators may be embracing higher risk. However, this could also represent a “dead cat bounce,” with smart money using the relief rally as an opportunity to sell before the downtrend resumes. Historical bear cycles show similar patterns, where altcoins occasionally spike amid broader weakness. For example, during the 2021–2022 bear market, the ETH/BTC ratio surged just one month in, even before mass capitulation events like the FTX collapse.

For now, the market remains at a crossroads, with early signs of optimism tempered by the risk of renewed selling pressure.

In this edition, we're doing things a little differently.

Today, we have our first Guest Author ever — Fawaz Adediran, who is a brilliant legal mind with ample knowledge about traditional financial systems and the Blockchain.

We trust that you'll learn a lot from this piece. Don't forget to subscribe and leave a comment after.🥂

TL;DR

• Decentralized finance has changed the way we think about money, markets, and trust.

• Early conversations focused heavily on cryptocurrencies and speculative tokens, but a ground-breaking concept quieter has been happening in the background — the emergence of bond-like instruments on-chain which aim

  to replicate debt — one of the most stable pillars of TradFi.

• The central point is simple. DeFi bonds are experimental, but they could reshape how fixed-income markets function.

• Their long-term success, however, will depend on governance, legal clarity, and how well they integrate with traditional financial systems.

From Traditional Finance to On-Chain Debt

In traditional finance, bonds are straightforward in principle. Governments issue sovereign bonds to fund infrastructure and public services. Corporations issue debt to expand, refinance, or manage liquidity. Investors lend money and, in return, receive periodic interest payments and repayment of principal at maturity. The system works because it rests on strong institutions and clear regulations.

Decentralized finance takes a very different approach. Instead of relying on banks, brokers, or even clearinghouses, it runs on blockchain networks and smart contracts. According to the Bank for International Settlements, decentralized finance combines crypto-assets, smart contracts, and decentralized governance to provide financial services without traditional intermediaries.¹ Trust thus shifts from institutions to code.

When DeFi was first introduced, it generally evolved around trading tokens, liquidity pools, and overcollateralized lending. But as the ecosystem matured, participants began building more structured financial products. Among these are bond-like instruments, often described as on-chain debt. These instruments try to mirror traditional bonds by offering defined returns over a set period.

The shift from traditional finance to DeFi in the bond space is a vivid depiction of a deeper change in how trust is constructed. In traditional markets, trust is institutional and legal whereas in DeFi, trust is algorithmic and distributed. The big question is whether code can reliably replace the institutional safeguards that underpin global fixed-income markets.

The Mechanics of DeFi Bonds

At its core, a bond is a contract. An investor provides capital, and the issuer promises repayment with interest. Putting this into context, it is important to note that with DeFi, that promise is encoded in a smart contract. Smart contracts act like automated trustees. Once deployed, they execute pre-set rules governing issuance, coupon payments, collateral requirements, and maturity.

The Federal Reserve Bank of St. Louis explains that DeFi systems use smart contracts to replicate financial functions that banks and other intermediaries traditionally perform.² In the bond context, this means interest payments can be distributed automatically, and redemption can occur without human intervention.

Tokenization is central to this process. Real-world assets such as government bonds, treasury bills, corporate receivables, or even green infrastructure revenues can be represented digitally on a blockchain. The World Economic Forum has highlighted how tokenization is expected to reshape capital markets by increasing efficiency and accessibility.³

Yield generation varies depending on the structure. Some DeFi bonds are backed by overcollateralized crypto lending. Others derive returns from protocol revenues or from tokenized real-world assets. More advanced protocols separate principal from yield, allowing investors to lock in fixed returns from otherwise variable-rate positions.

One of the most powerful features of DeFi is composability. On-chain bonds can interact seamlessly with other protocols. They can be used as collateral elsewhere, traded in automated market makers, or integrated into derivatives platforms. This interconnectedness creates efficiency, but it also introduces layers of complexity and risk.

Governance-Backed and Fixed-Yield Protocols

Several protocols have played a key role in developing bond-like instruments. One of of such is MakerDAO which is now operating as Sky Protocol, pioneered governance-backed debt through collateralized positions that generate stablecoins.

Over time, it incorporated exposure to real-world assets, including tokenized U.S. Treasury instruments. While not a bond in the traditional sense of it, the system produces yield structures that closely resemble fixed-income products. Governance token holders oversee risk parameters and exposure limits, effectively acting as a decentralized oversight body.

Protocols such as Pendle Finance and Notional Finance have taken the idea further. Pendle allows users to tokenize future yield streams. Therefore, through the separation of principal and yield components, it creates fixed-income exposure from assets that would otherwise produce variable returns. Notional Finance offers fixed-rate lending and borrowing that function much like zero-coupon bonds, where assets are issued at a discount and redeemed at full value at maturity.

These systems replicate core bond characteristics: defined maturity, predictable returns, and a very crucial one; secondary market tradability. The difference basically lies in enforcement. Instead of relying on a corporate issuer’s creditworthiness and legal remedies, repayment depends on smart contract integrity and sufficient collateral.

Market research suggests this segment will continue growing. Technavio projects expansion in decentralized finance markets between 2025 and 2029, driven partly by institutional participation and asset tokenization.⁴ Fixed-income innovation is likely to be a significant part of that trajectory.

Risk Analysis

No discussion of DeFi bonds would be complete without a sober look at risk. It is without an iota of doubt that smart contract risk sits at the top of the list. Code vulnerabilities can lead to significant losses.

Smart contracts are often immutable once they have been deployed and executed. If flaws exist, they can be exploited. In traditional bond markets, investors can pursue legal remedies against issuers or trustees. In DeFi, legal recourse may be unclear or practically limited for now.

Furthermore, Oracle risk is another issue. Many protocols depend on external price feeds to determine collateral value and manage liquidations. If an oracle is manipulated or fails, bond-like instruments can become mispriced or undercollateralized.

To buttress the point, regulatory uncertainty adds another layer. The Bank for International Settlements has warned that decentralized finance may amplify financial stability risks through leverage, maturity mismatches, and interconnected exposures.⁵ Traditional bonds operate within strict disclosure and investor protection frameworks. DeFi instruments often operate across borders without clear jurisdictional oversight.

In addition, governance risk also matters. Token-based voting systems can concentrate power in the hands of a few large holders. If governance is captured, risk parameters can shift in ways that disadvantage smaller participants.

Conclusively, liquidity risk cannot be ignored. Secondary markets in DeFi rely on algorithmic liquidity pools. During periods of stress, liquidity can disappear quickly, sometimes faster than in traditional markets where central banks may intervene.

Macroeconomic and Systemic Implications

The broader economic implications of DeFi bonds are typically significant. This is because on the positive side, they may expand access to fixed-income opportunities. Traditional bond markets can be exclusive, often requiring substantial capital or institutional access. DeFi lowers barriers to entry, enabling global participation.

Programmable bonds may also reduce operational friction. Automated settlements and transparent on-chain records can lower administrative costs and improve traceability.

At the same time, integration with the broader financial system raises important questions. The World Economic Forum has described digital assets as reaching an inflection point, with institutional engagement accelerating.⁶ If decentralized bonds grow alongside central bank digital currencies, monetary policy transmission and capital flows could evolve in unexpected ways.

Sustainable finance is another promising area. Research exploring the evolution of sustainable investment suggests decentralized finance could enhance transparency in green bond issuance.⁷ Tokenized green bonds could allow investors to track fund allocation and environmental impact more effectively.

Still, without regulatory coordination, cross-border on-chain debt issuance could create challenges for investor protection and capital control regimes. Policymakers will likely move toward frameworks that integrate tokenized securities into regulated markets rather than banning them outright.

Moving Towards a Unified Financial Layer

Bonds in decentralized finance represents a serious attempt to rebuild fixed-income markets on programmable infrastructure. The innovation is truly impressive. Automated execution, borderless access, and composability create possibilities that traditional markets cannot easily replicate. At the same time, the risks are real. Technology can fail. Governance can be captured. Regulation can lag behind innovation.

A realistic future might involve a blended system where tokenized bonds coexist with conventional securities. Interoperable infrastructure, clearer regulation, and institutional participation could gradually unify these layers.

Ultimately, the success of DeFi bonds depends on credibility. Investors need confidence that algorithmic systems can protect capital as reliably as established institutions. If that confidence grows, fixed-income markets could become more accessible, transparent, and efficient than ever before.

The experiment is still unfolding. What is clear is that bonds, even in a decentralized world, remain central to how capital is raised and allocated. The difference now is that the trustee may be a smart contract, and the ledger may be global.

References

1. Bank for International Settlements, Cryptocurrencies and Decentralized Finance: Functions and Financial Stability Implications (BIS Papers No 156, 2025) https://www.bis.org/publ/bppdf/bispap156.pdf accessed 21 February 2026.

2. Federal Reserve Bank of St. Louis, ‘Decentralized Finance: On Blockchain- and Smart Contract-Based Financial Markets’ https://research.stlouisfed.org accessed 21 February 2026.

3. World Economic Forum, ‘Digital Economy Inflection Point: What to Expect for Digital Assets in 2026’ (2026) https://www.weforum.org/stories/2026/01/digital-economy-inflection-point-what-to-expect-for-digital-assets-in-2026/ accessed 21 February 2026.

4. Technavio, Decentralized Finance Market Analysis 2025–2029 (2025) https://www.technavio.com/report/decentralized-finance-market-analysis accessed 21 February 2026.

5. Bank for International Settlements (n 1).

6. World Economic Forum (n 3).N

7. Natália Teixeira, ‘The Evolution of Sustainable Investment: The Role of DeFi and Green Bonds in Efficiency and Transparency of Green Finance’ (2025) ResearchGate https://www.researchgate.net/publication/390916206_The_Evolution_of_Sustainable_Investment_The_Role_of_Decentralised_Finance_and_Green_Bonds_in_the_Efficiency_and_Transparency_of_Green_Finance accessed 21 February 2026.

Author's Bio

Fawaz Adediran is a law graduate with a strong interest in finance, blockchain technology, and ESG. He has written several articles which have been published in international journals, reaching readers across several jurisdictions. He also contributes to ongoing conversations in finance and technology as a whole.

As he advances toward professional practice, he is focused on building expertise at the intersection of law, finance, and emerging technologies while contributing meaningfully to forward-thinking institutions.

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Another hint: The SEC is eyeing a crypto innovation exemption this year.

Several other juicy updates await you in this weekly report.

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Development in Regulatory Frameworks

Russia to begin mass blocking of major crypto exchanges this summer

Russia will start blocking foreign cryptocurrency exchanges as early as this summer, according to Nikita Zuborev, a senior analyst at Bestchange. Roskomnadzor, the country’s internet and media watchdog, is expected to mass-block exchange websites that are not registered in Russia.

The move comes as lawmakers prepare stricter crypto regulations for the spring State Duma session. Proposed legislation would outlaw transactions on unregistered platforms, tightening state oversight.

A ban on foreign exchanges would escalate Russia’s digital censorship. Roskomnadzor has already blocked Telegram and WhatsApp while restricting VPN services used to bypass blocks.

Russians trade roughly $648 million in crypto daily, according to the Ministry of Finance. Since exchanges remain unregulated, transactions occur on unregistered domestic platforms or foreign exchanges. Even after Binance exited Russia in 2023, over one million Russians reportedly continue trading there.

Roskomnadzor is investing in AI-driven censorship tools that could disrupt access to overseas exchanges, mining pools, and crypto data services.

CFTC claims sole authority over prediction markets

The Chair of the Commodity Futures Trading Commission, Mike Selig, has entered the intensifying legal battle over whether prediction markets can legally offer sports-related contracts across the United States. In a court filing and a video posted Tuesday, Selig confirmed the CFTC submitted an amicus brief supporting crypto exchange Crypto.com in its lawsuit against Nevada regulators.

The case stems from an order by the Nevada Gaming Control Board directing Crypto.com to halt its prediction market product in the state. A federal judge denied the exchange’s request for a preliminary injunction, prompting Crypto.com to suspend sports event contracts in Nevada while it appeals.

Selig said the CFTC intervened to defend its “exclusive jurisdiction” over derivative markets. The move drew criticism from 23 Democratic Senators, who warned that prediction markets resemble unlicensed sports betting and evade state and tribal consumer protections.

The backlash has not been partisan. Utah Governor Spencer Cox called the products “gambling — pure and simple,” arguing they harm families and young men.

Platforms such as Kalshi and Polymarket argue sports-themed “event contracts” fall under federal derivatives law, while states insist they are traditional gambling products requiring licensure.

Though an amicus brief is nonbinding, legal experts say the CFTC’s stance carries significant weight. Crypto leaders welcomed the move, including Tyler Winklevoss, who praised Selig’s defense of federal authority as a boost for U.S. crypto markets.

The SEC eyes a crypto innovation exemption this year

Senior officials from the U.S. Securities and Exchange Commission took the stage at ETHDenver this week to outline the agency’s evolving approach to crypto regulation. Chair Paul Atkins and Commissioner Hester Peirce discussed a potential “innovation exemption” for limited onchain trading of tokenized securities.

Atkins described the exemption as a framework that would allow issuers to tokenize securities in collaboration with transfer agents and enable onchain trading through automated market makers or other decentralized platforms. The proposal would operate as a temporary sandbox, featuring volume limits, participant allowlisting, and other guardrails to reduce systemic risk.

Peirce cautioned against inflated expectations, likening the exemption to opening an abandoned storage unit that contains neither a hidden treasure nor a monster. She suggested both Wall Street skeptics and crypto optimists would likely find the outcome underwhelming—and intentionally so.

Beyond the exemption, Atkins emphasized the potential of smart contracts to embed regulatory compliance directly into code. He also highlighted zero-knowledge proofs as a way to preserve financial privacy while still meeting Bank Secrecy Act obligations.

Two sitting SEC officials openly engaging with crypto developers signaled a notable shift in regulatory posture.

Crypto Holdings and Acquisitions

Japan’s top securities firms prepare crypto exchange pivot

Three major Japanese securities firms with a combined market capitalisation of about $48 billion are considering launching crypto exchange businesses, betting on regulatory easing and renewed investor demand.

Nomura Holdings, Japan’s largest securities provider, plans to enter the market via its Swiss crypto subsidiary Laser Digital, with crypto trading services targeted for launch by the end of 2026, according to Nihon Keizai Shimbun. Daiwa Securities Group and SMBC Nikko Securities are also seriously considering entry.

The firms expect demand to surge if Tokyo lifts restrictions on crypto exchange-traded funds. Despite recent price weakness in Bitcoin, Japanese institutions are pressing ahead with digital asset strategies, with more corporate treasuries expected to expand crypto holdings in 2026.

Strict licensing rules remain a hurdle, with few firms holding exchange permits. Rivals SBI Holdings and Monex Group previously entered the market by acquiring smaller exchanges.

Regulatory reform is a key catalyst. Proposed changes by the Financial Services Agency could reclassify major cryptocurrencies as investment products, encouraging deeper participation by traditional financial institutions.

South Korea lifts 9-year corporate crypto ban.

After a nine-year ban, South Korea is reopening corporate access to cryptocurrency markets under a tightly regulated framework. The Financial Services Commission (FSC) allows listed companies and professional investment firms to trade, ending the 2017 prohibition aimed at curbing retail speculation, money laundering, and financial instability.

Corporate allocations are capped at 5% of annual equity and limited to the top 20 cryptocurrencies traded on five regulated domestic exchanges. Stablecoins remain under review, while exchanges must implement safeguards such as staggered trade execution and order-size limits to prevent market disruption. About 3,500 organizations are expected to qualify initially.

This move is part of South Korea’s broader “2026 Economic Growth Strategy,” which includes the upcoming Digital Asset Basic Act, stablecoin legislation, and plans for spot crypto ETFs.

Criminal Matters

Crypto transactions linked to human trafficking surged by 85% last year

Crypto transactions linked to alleged human trafficking jumped 85% in 2025, according to a February report by Chainalysis. The firm tracked hundreds of millions of dollars tied to illicit escort services, prostitution networks, and child sexual abuse material vendors, stressing that financial figures “significantly understate the human toll,” which is measured in lives harmed rather than money moved.

Much of the growth is concentrated in Southeast Asia’s expanding scam economy. Chainalysis highlighted the role of labour placement agents—people lured by fake job offers and then forced into working at scam compounds. These large, self-contained facilities, often equipped with dormitories, food halls, and gyms, host victims who run cyber scams ranging from pig-butchering schemes to illegal gambling.

The scale is staggering. Estimates suggest scams now account for a substantial share of regional GDP. More than 30% of Cambodia’s GDP came from cyberscam revenue in 2023, while East and Southeast Asia lost about $37 billion to cybercrime, according to an April 2025 report by the United Nations Office on Drugs and Crime.

The illicit economy is also reshaping geopolitics. Tensions between Thailand and Cambodia escalated after Thai authorities seized more than $300 million, including crypto, from Cambodian elites linked to scam networks. Inca Digital called the border dispute the first military flashpoint driven by the political economy of crypto fraud.

Crackdowns have produced mixed results. “There is no end to the construction in Cambodia right now,” said Erin West of Operation Shamrock, warning that ever-larger scam compounds continue to emerge.

Bitcoin miner stole $80,000 worth of power

Russia’s northwestern Komi Republic aims to reinvent itself as the country’s leading Bitcoin mining hub by the end of 2026. But while officials push forward with long-term plans, some miners are taking illegal shortcuts.

Police recently arrested a 39-year-old farm owner accused of stealing about $80,000 worth of electricity from the regional grid to power crypto-mining operations. According to the Russian Ministry of Internal Affairs (Komi branch), the man used illegal connections to bypass electricity meters and draw power directly from a transformer substation.

Investigators say he operated more than 80 ASIC mining rigs from a warehouse originally meant to store logging and farming equipment. He also failed to register his activities with the tax authorities. Under Russian law, private individuals are limited to 6,000 kWh of electricity per month—barely enough to run two or three modern mining rigs, RBC reported.

Meanwhile, Komi officials plan to build 15 crypto-mining data centers, two of which are already under construction at a combined cost exceeding $28 million. One facility, located in an industrial park, will have a capacity of 114 MW, according to CNews.

Authorities, working with the Federal Security Service, have confiscated the rigs. The suspect faces charges of breach of trust and property damage, with lawmakers in the State Duma considering even harsher penalties for illegal miners.

Former investment fund chief embezzled almost $40 million

A former investment fund chief who embezzled nearly $40 million in Bitcoin from Georgia’s ex–prime minister Bidzina Ivanishvili has been released from prison after a plea deal.

The man, Giorgi Bachiashvili, a Georgian-Russian national, was sentenced in absentia to 11 years in prison after fleeing Georgia in March. He was later arrested at the border with Azerbaijan and returned to custody, with courts adding four years for illegal flight, according to Vzglad.

Following negotiations with prosecutors, Bachiashvili fully admitted guilt and cooperated with investigators. As a result, his sentence was reduced to a suspended one-year term and a $19,000 fine, Georgian state broadcaster Channel 1 reported.

Ivanishvili, one of Georgia’s wealthiest and most influential figures, hired Bachiashvili in the early 2010s to manage personal and business assets. In 2015, Ivanishvili’s bank, Cartu, loaned Bachiashvili Bitcoin to launch a mining firm—coins prosecutors say were instead embezzled. Charges against Bachiashvili’s parents, accused of laundering $3.5 million, were also dropped.

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Lawsuits and Court Rulings

Polymarket’s lawsuit could decide who regulates U.S. prediction markets

Polymarket’s federal lawsuit against Massachusetts could determine whether U.S. prediction markets are regulated solely by the Commodity Futures Trading Commission (CFTC) or by states as well. The dispute centers on whether event contracts qualify as financial derivatives under the Commodity Exchange Act or as gambling under state laws.

In February 2026, Polymarket filed suit in the U.S. District Court for the District of Massachusetts to preempt enforcement requiring compliance with state gambling regulations. The company argues that Congress granted exclusive authority over “event contracts” to the CFTC, making state restrictions unlawful. Chief legal officer Neal Kumar contends that piecemeal enforcement by individual states could hinder national market development.

The lawsuit follows state actions against rivals like Kalshi, where Massachusetts blocked sports-related contracts as unlicensed gambling, and Nevada pursued similar measures. States assert that when prediction markets resemble gambling, platforms must follow local licensing and consumer protections.

A federal ruling in Polymarket’s favor would establish uniform national oversight and prevent a patchwork of differing state rules, while a decision favoring states would reinforce state-level authority.

US CLARITY Act could pass by April

The US CLARITY Act, a long-awaited bill designed to bring regulatory clarity to the American crypto industry, could pass Congress within weeks, according to crypto-friendly Senator Bernie Moreno. Speaking to CNBC at Mar-a-Lago on Wednesday, Moreno said lawmakers are aiming for approval “hopefully by April.”

Moreno appeared alongside Brian Armstrong, who said the interview followed discussions at the World Liberty Financial crypto forum involving lawmakers, bankers, and industry leaders to resolve market structure issues. Armstrong noted that previous disagreements centered on stablecoin rewards, which banks feared could divert deposits from traditional institutions.

Although Coinbase withdrew support for the bill in January due to provisions banning interest-bearing stablecoins and elevating the SEC as the primary crypto regulator, Armstrong said progress has been made. He described a “path forward” that could deliver benefits for crypto firms, banks, and consumers while advancing President Donald Trump’s crypto agenda.

Moreno acknowledged delays tied to stablecoin rewards but said the issue should not block passage. Meanwhile, prediction platform Polymarket briefly placed the bill’s 2026 approval odds at 90%.

Nevada sues Kalshi after prediction markets loss

The U.S. state of Nevada has sued Kalshi after the company lost its attempt to block state regulators from taking action against its sports prediction markets. On Tuesday, the U.S. Court of Appeals for the Ninth Circuit denied Kalshi’s request to prevent enforcement by Nevada’s gaming regulator.

Following the ruling, the Nevada Gaming Control Board filed a civil enforcement action in state court, alleging that Kalshi is offering unlicensed sports wagering in violation of Nevada law. Kalshi quickly moved to shift the case to federal court, arguing that it falls under the exclusive jurisdiction of the Commodity Futures Trading Commission (CFTC).

The lawsuit marks a significant setback in Kalshi’s nearly year-long legal battle with Nevada and comes amid similar actions from other states. Nevada maintains that Kalshi’s sports event contracts constitute gambling under state law and therefore require licensing.

Earlier the same day, CFTC chair Mike Selig said the agency filed an amicus brief supporting Crypto.com in a related dispute, asserting that prediction markets are federally regulated commodity derivatives.

The jurisdictional debate has intensified as Trump Media and Technology Group explores prediction markets for Truth Social, and Donald Trump Jr. continues advisory roles with Kalshi and Polymarket.

Mood of the Market

Bitcoin buyers could drive the price back to $100,000

Crypto traders may push Bitcoin back to $100,000, says Shawn Young, chief analyst at MEXC Research. While buying volumes have slowed compared to recent months, demand still exceeds daily mining output, creating a net-positive supply dynamic that could trigger a near-term rebound.

Young’s optimism contrasts with broader market pessimism. Since October, cryptocurrencies have lost around $2 trillion in value, with Bitcoin down 46%, trading near $68,000 for most of February. Some analysts, like Bloomberg Intelligence’s Mike McGlone, predict a far steeper drop, with Bitcoin potentially falling to $10,000. McGlone cites strong stock performance, gold and silver outperforming as safe havens, and waning faith in U.S. President Donald Trump’s crypto support as key factors.

Others, including Ben Harvey of Keyrock, say Bitcoin’s next move depends more on macroeconomic forces—Federal Reserve rate cuts and institutional ETF investments—than the crypto market itself.

The downturn coincides with tech selloffs fueled by AI spending fears. Hedge funds are increasingly using credit default swaps to hedge against corporate debt risks, a trend dubbed the “AI scare trade.” Major tech ETFs are down over 23% YTD, while massive AI investments increase potential downside risk. Bitcoin, trading like a tech stock, is particularly sensitive to these capital shifts.

Currently, Bitcoin is down 1.3% at $68,034, and Ethereum is down 0.7% at $1,973.

Macro to dictate Bitcoin’s next $10,000 move

Traders are waiting on macroeconomic signals to guide Bitcoin’s next move as the crypto market consolidates following its biggest drop in nearly four years. Over the past month, Bitcoin fell about 28%, revisiting levels seen before President Donald Trump’s 2024 election win, and has since traded between $74,400 and $65,000. The cryptocurrency is down 45% from its July all-time high.

Ben Harvey of Keyrock says the next major move will be driven by macro factors, including shifts in interest rate forecasts, Treasury financing expectations, and institutional demand. Rate cuts, usually seen as bullish for risk assets, are unlikely before the Federal Reserve’s June meeting.

The crypto market currently lacks a strong narrative. Trump’s previous crypto-friendly policies and stablecoin legislation helped push Bitcoin past $126,000 last October, but stalled regulatory efforts and the dominance of gold and silver have left investors uncertain, leading to low liquidity and muted price movements.

Nathan Batchelor of Biyond notes that tax season and capital flows back into traditional finance have weighed on Bitcoin. Analysts see $82,000 as key resistance, while positive netflows, options expiries, and potential progress on the stalled Clarity Act could spark a breakout.

Despite optimism, caution remains: historical patterns suggest recovery after such sharp losses is unlikely to be immediate.