Track market-moving stories before they get noisy

Bitget Chief Executive Officer Gracy Chen has expressed strong skepticism that the United States government will actively purchase Bitcoin on the open market to expand its Strategic Bitcoin Reserve before the end of President Donald Trump’s current term.

In a recent interview, Chen described such acquisitions as improbable from a policy standpoint, saying she does not expect them to materialize within the next two years.

The Strategic Bitcoin Reserve was formalized through an executive order signed on March 6, 2025.

That directive primarily capitalizes the reserve with Bitcoin federal authorities already obtained through criminal and civil asset forfeiture proceedings.

It does not authorize using taxpayer funds for market purchases.

Instead, any additional acquisitions must follow budget-neutral approaches that impose no extra costs on American taxpayers.

The order also generally prohibits selling Bitcoin held in the reserve, creating a one-way mechanism where seized assets can enter but do not routinely exit through auctions or liquidations.

Public estimates place current US government Bitcoin holdings associated with the reserve in the range of roughly 198,000 to over 300,000 BTC, depending on the tracker used, stemming largely from law enforcement actions rather than deliberate sovereign accumulation.

Before the order, authorities sold substantial quantities of forfeited Bitcoin; the new framework ends that practice for assets designated for the reserve.

Chen’s assessment aligns with the practical constraints of the current setup.

Actively purchasing Bitcoin, she noted, would represent a significantly larger policy decision requiring extensive debate among lawmakers, political parties, and other stakeholders—far beyond simply retaining assets already under government control.

While the administration has maintained a relatively crypto-friendly stance, turning the reserve into an active buying program is not straightforward.

This structure means the reserve functions more as a long-term holding vehicle for existing government-controlled Bitcoin than as an active accumulation program.

The no-sale provision removes a potential source of future supply pressure on the market, which could offer some stability.

However, it does not create the ongoing demand that scheduled government purchases might.

Chen also indicated that if the US did begin accumulating Bitcoin, the impact could be substantial and not fully priced in, potentially driving prices higher as other jurisdictions and US states take notice.

Yet she maintains that, based on policy realities observed over the past year, such a move remains unlikely under the current framework through at least the next couple of years.

For market participants, the takeaway is tempered expectations: the Strategic Bitcoin Reserve solidifies the government’s role as a long-term holder of forfeited coins but is unlikely to emerge as a major buyer in the foreseeable future. Further developments would hinge on successfully identifying truly budget-neutral methods or on new congressional action.

Strive, a US-based investment management company, increased its Bitcoin holdings by 1,110 BTC last week, bringing its total Bitcoin treasury to 21,356 BTC. The purchase, made for $81.5 million at an average price of $73,409 per coin, was disclosed in the company’s latest filing with the US Securities and Exchange Commission.

Strive’s expanding Bitcoin strategyThe acquisition took place between August 17 and August 21, during which time Strive’s cash reserves grew from $154.8 million to $171.9 million. This increase indicates that the firm continued to raise capital even as it allocated significant resources to expand its Bitcoin position. The higher cash balance also provides Strive with liquidity to support ongoing operations and potential future purchases.

To fund these acquisitions, Strive relies on a mixture of equity and preferred share offerings. Over the reporting week, Strive’s Class A shares outstanding rose by 3,646,300 to 79,890,888, while its SATA preferred shares increased by 441,313 to 8,270,815. Assuming full dilution, the total share count reached 92,949,226 by the end of the week.

This growth in outstanding shares creates a balancing act for the company. While adding more Bitcoin to the treasury may suggest higher exposure, the real impact for individual investors depends on how much Bitcoin is held per diluted share. If new Bitcoin holdings are acquired at a slower pace than shares are issued, per-share exposure can be diluted despite headline growth metrics.

MetricAugust 14August 21BTC holdings20,24621,356Cash & equivalents$154.8 million$171.9 millionClass A shares76,244,58879,890,888SATA preferred shares7,829,5028,270,815Apart from Bitcoin, Strive also holds 505,000 shares of Strategy’s STRC preferred stock, which increased in fair value by $707,000 to reach $48.57 million. This position, alongside the larger cash balance, gives the company more flexibility, but the Bitcoin treasury remains its primary draw for investors.

According to Strive, its broader operations manage nearly $3 billion in assets across exchange-traded funds and direct indexing. The company’s strategy is to use fee income to help offset costs arising from preferred stock issuance, aiming to capture the spread between financing costs and long-term potential returns from Bitcoin. If financing costs were to rise or Bitcoin’s value were to fall, this spread could shrink.

Mini dictionary: Strive, an investment management company based in the United States, manages a range of financial products including publicly traded exchange-traded funds (ETFs) and direct indexing solutions, with a particular recent focus on large-scale Bitcoin accumulation as part of its corporate treasury strategy.

Bitcoin rally supports recent acquisitionOn the day Strive disclosed its purchase, Bitcoin was trading near $79,400, giving the new 1,110 BTC holdings a market value of $88.1 million. This value exceeds the acquisition cost by roughly $6.6 million, further strengthening the company’s position. Overall, the total Bitcoin in Strive’s treasury would now be valued near $1.70 billion at those prices.

Technical analysts observed positive signals for the broader market. Ali Martinez, an independent crypto analyst, noted that Bitcoin’s price reclaimed its 1,130-day simple moving average after moving above $74,000 on August 20. Bitcoin had traded below this long-term average for nearly three months, a period associated with broader market uncertainty.

Martinez highlighted that, across past cycles, Bitcoin began new bull markets after recovering this long-term average. However, he cautioned that a sustained rally depends on further closes above this level and stable spot demand.

During the recent session, Bitcoin reached a high close to $79,934, which provided further upside to Strive’s latest purchase. This price momentum also supported the market value of the company’s Bitcoin holdings acquired in previous quarters. In January, Strive’s acquisition of Semler Scientific added approximately 5,048 BTC to its books, helping scale the treasury quickly ahead of the latest round of buying.

Investors monitoring Strive’s performance now face two key variables: whether Bitcoin’s price can maintain support above the reclaimed moving average and whether Bitcoin per diluted share can continue to grow despite higher equity issuance.

Rising BTC holdings may grab attention, but according to Strive’s latest filing, shareholder returns depend on whether treasury growth can outpace dilution caused by increasing the number of shares outstanding.

Future company disclosures will reveal if Strive’s Bitcoin accumulation strategy continues to increase actual exposure per share or if further equity raises dilute these gains.

Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that cryptocurrencies carry high volatility and therefore risk, and should conduct their own research.

The Treasury just doubled its bond buyback program while national debt crossed $40 trillion. Bitcoin responded with its best week since March 2024, gaining 27% as institutional money poured into spot ETFs at a record pace.

Summary

Bitcoin surged from $62,679 to $79,500 between Aug. 17 and Aug. 21, a 27% gain that coincided with U.S. national debt crossing $40 trillion for the first time. Treasury Secretary Scott Bessent doubled the maximum per-operation buyback size from $2 billion to $4 billion for 10-to-30-year securities, effective Sept. 9, and hinted the ceiling could rise further. BlackRock’s iShares Bitcoin Trust (IBIT) pulled in $606 million in a single session on Aug. 20, capturing 82% of all spot Bitcoin ETF inflows that day. Short liquidations across crypto derivatives exchanges totaled $3 billion in 24 hours, affecting more than 170,000 traders in the largest squeeze since November 2021. Ray Dalio warned that a U.S. debt crisis could arrive “in three years, give or take two” and recommended investors hold gold and “a bit” of bitcoin as hedges against fiscal deterioration. On the morning of Aug. 19, 2026, the U.S. Treasury Department announced it would at least double the size of its long-end liquidity support buyback operations. Within 12 hours, bitcoin had gained 8.2%, blowing through its 200-day moving average for the first time in nine months. By Friday, it was knocking on $80,000.

The surface narrative is simple: falling yields make non-yielding assets more attractive. But the rally that followed was not just a rate-trade reaction. It was a statement about what investors now believe the United States government will do when its borrowing costs become unmanageable. And the answer, delivered by the Treasury itself, was: print more liquidity.

That interpretation turned bitcoin from a speculative risk asset into a fiscal-fear trade, a bet that the world’s reserve currency issuer has entered a debt spiral it cannot exit through austerity alone. The mechanism connecting Treasury buybacks to bitcoin’s price is more direct than most investors realize.

What the Treasury actually did On Aug. 19, the Treasury Department raised the maximum per-operation size for its liquidity support buybacks from $2 billion to at least $4 billion. The change applied to securities in the 10-to-20-year and 20-to-30-year maturity sectors. The number of long-end operations also increased from two to four per quarter, with the new schedule taking effect on Sept. 9.

Bessent told CNBC on Aug. 20 that “there is every indication that the buybacks could exceed” the $4 billion ceiling. The phrasing was deliberate. The Treasury secretary was signaling that bond market intervention would scale as needed, with no preset upper bound.

This is not quantitative easing in the formal sense. The Treasury is not creating new reserves or expanding its balance sheet the way the Federal Reserve did between 2020 and 2022. Instead, it is buying back older, less liquid bonds and replacing them with newly issued debt. The mechanical effect, however, is similar: long-term yields fall, the dollar weakens, and risk assets rally.

The 30-year Treasury yield dropped 9 basis points in the hours following the announcement. The dollar index fell to its lowest level since June. Gold climbed 2.1%. Bitcoin did all of that and more.

The $40 trillion backdrop The timing of the buyback expansion was not coincidental. U.S. national debt crossed $40,047,425,768,420.22 on Aug. 18, 2026, one day before the announcement. That milestone arrived just five months after the debt passed $39 trillion in March, making it the fastest trillion-dollar increase in the country’s history.

The numbers paint a picture of structural deterioration. The federal government is spending roughly 40% more than it collects in revenue, with annual income near $5.5 trillion and expenses near $7.5 trillion. Interest payments on the debt have surpassed Medicare to become the second-largest line item in the federal budget, trailing only Social Security.

Total debt has more than doubled from the approximately $19.95 trillion outstanding when President Trump first took office in January 2017. The Congressional Budget Office projects annual deficits exceeding $2 trillion through at least 2034, assuming no recession intervenes. Each trillion now arrives faster than the last, a compounding dynamic that bond markets have begun to price with increasing urgency.

The day the debt clock ticked past $40 trillion, the Treasury held its regularly scheduled 20-year bond auction. Demand was tepid. The bid-to-cover ratio fell to its lowest level since February, forcing a higher yield to clear the sale. One day later, the buyback announcement arrived. The sequence was not subtle: the government struggled to sell new debt on Monday, then announced it would buy back old debt on Tuesday. The market drew its own conclusions.

For bitcoin holders, this arithmetic is the thesis. A government that cannot balance its books and cannot politically tolerate the austerity required to do so will eventually monetize its obligations. Whether that monetization arrives through formal quantitative easing, yield-curve control, or the quiet expansion of buyback programs does not change the destination. It only changes the pace.

How buybacks became a bitcoin catalyst The transmission mechanism from Treasury buybacks to bitcoin runs through three channels.

First, when the Treasury buys back older bonds, it compresses long-term yields. Lower yields reduce the opportunity cost of holding non-yielding assets like gold and bitcoin. Before the buyback announcement, the 30-year Treasury was offering 5.12%. After it, 5.03%. That 9-basis-point move may sound trivial, but in a market where trillions of dollars in capital allocation are benchmarked against the risk-free rate, it shifts the entire cost-of-capital equation.

Second, the buyback program injects liquidity into the bond market. Dealers who sell older bonds to the Treasury receive cash, which they redeploy into other assets. Some of that cash flows into equities. Some flows into crypto. The pathway is indirect but measurable: on the same day as the buyback announcement, spot bitcoin ETFs absorbed $517 million in net inflows, their strongest daily result since May.

Third, and most importantly, the buyback expansion signals a policy preference. The Treasury is telling the market that it will intervene to prevent long-term yields from rising to levels that threaten fiscal sustainability. That signal, more than any single operation, is what reprices bitcoin. It tells investors that the government will choose inflation over austerity when forced to pick.

The ETF plumbing underneath the rally The week of Aug. 17 to 21 produced one of the most concentrated bursts of institutional bitcoin buying since spot ETFs launched in January 2024.

On Aug. 20 alone, U.S. spot bitcoin ETFs recorded $606 million in net inflows. BlackRock’s IBIT captured $497 million of that total, an 82% market share that underscores its dominance as the vehicle of choice for institutional allocation. IBIT’s cumulative net inflows reached $62.43 billion, and total spot bitcoin ETF assets climbed above $90 billion.

The four-day stretch from Monday through Thursday saw approximately $1.9 billion flow into spot bitcoin funds. Eight of 12 listed products attracted positive flows, suggesting the buying was broad-based rather than concentrated in a single fund.

21Shares senior strategist Matt Mena argued that expectations of a weaker dollar helped drive institutional capital toward scarce assets. The framing is significant. When an ETF strategist at a major issuer describes bitcoin as a “scarce asset” in the same sentence as dollar depreciation, the narrative has shifted from speculation to macro allocation.

Tudor Investment disclosed an additional 109,446 shares of IBIT during the same period. UBS raised its IBIT position to $90 million. These are not retail traders chasing momentum. They are multi-billion-dollar allocators repositioning around a fiscal thesis.

The composition of the buying matters as much as its volume. When ETF inflows are dominated by a single product and concentrated in a two-day window, the pattern often reflects a macro catalyst triggering allocation model changes at large institutions. A retail-driven rally tends to spread across smaller funds and arrive over weeks, not hours. The Aug. 19-20 pattern looked institutional from the first print.

Sizing the buyback against bitcoin’s market Here is arithmetic that most coverage of the rally has overlooked.

The Treasury plans to execute at least four long-end buyback operations per quarter at $4 billion each, for a minimum quarterly volume of $16 billion. Annualized, that is $64 billion in long-end bond purchases.

Bitcoin’s total market capitalization at $78,000 is approximately $1.55 trillion. The $64 billion in annual buyback volume represents 4.1% of bitcoin’s entire market cap. That does not mean 4.1% of buyback proceeds flow into bitcoin. But it does mean the liquidity injection from this single program is large enough to move bitcoin’s price if even a small fraction of the freed-up capital rotates into crypto.

Compare that to spot bitcoin ETF inflows. In the 12 months through July 2026, U.S. spot bitcoin ETFs absorbed approximately $28 billion in net inflows. The Treasury’s buyback program is injecting 2.3 times that amount into the broader financial system every year. If just 5% of buyback-related liquidity ultimately reaches bitcoin markets, through ETFs, futures, or direct spot purchases, that would equal $3.2 billion per year in incremental demand, roughly equivalent to a full month of average ETF inflows.

This is a back-of-the-envelope calculation, not a precise forecast. But it illustrates why the market’s reaction was so violent. The buyback program is not a one-time event. It is a recurring liquidity injection that compounds over time, and its scale is large relative to bitcoin’s absorptive capacity.

Consider the comparison from the other direction. Bitcoin’s daily spot volume averaged roughly $35 billion during the rally week. The Treasury’s $4 billion per operation is 11.4% of a single day’s trading volume. Spread across a quarter with four operations, that is $16 billion in fresh liquidity entering a system where marginal price is set by a much thinner order book than headline volume suggests. The effective float, the coins actually available for sale at any given price, is a fraction of total supply. Most bitcoin sits in long-term holder wallets and does not move.

The Dalio endorsement and what it signals On Friday, Aug. 21, Ray Dalio published a LinkedIn post that amounted to the most explicit bitcoin endorsement of his career. The Bridgewater Associates founder warned that the U.S. government’s financial condition had reached “an inflection point” and recommended investors reduce bond exposure while holding 10% to 15% of their portfolios in gold and “a bit” of bitcoin.

Dalio’s framing was specific. He linked the Treasury’s buyback expansion directly to the broader debt trajectory, arguing that Bessent’s move was “a sign that a debt crisis is getting closer.” If the U.S. government were a business, Dalio noted, its debt service payments would total approximately $11 trillion, roughly 200% of annual revenue.

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Roughly 594 $BTC valued at $38 million has been stolen from certain dormant single sig wallets pic.twitter.com/f3fk7kYXzM

— crypto.news (@cryptodotnews) August 1, 2026 The significance is not that Dalio likes bitcoin. It is that the most prominent macro investor of the past four decades now treats bitcoin and gold as complements in the same hedge. When Dalio says sell bonds and buy scarce assets, the audience is not retail. It is sovereign wealth funds, pension allocators, and family offices managing multi-generational capital.

The bitcoin-gold correlation rose to approximately +0.7 during the rally week, a level described by analysts as a return to “digital-gold-era” pricing. Both assets rose together because both were responding to the same signal: the United States government will choose monetary expansion over fiscal discipline.

The White House factor The Treasury buyback was not the only policy catalyst that week. On Aug. 19, the same day as the buyback announcement, President Trump convened a White House meeting with crypto executives and regulators to discuss the CLARITY Act, the most ambitious attempt at comprehensive crypto legislation in U.S. history.

The meeting produced no binding commitments, but it sent a signal that the administration views crypto as a policy priority. Bitcoin jumped more than 5% to trade above $68,600 within hours of the meeting’s conclusion. By Thursday, BTC had cleared $72,000 for the first time since early June.

The SEC added its own accelerant. On Aug. 18, the commission published its Regulation Crypto Assets notice of proposed rulemaking, offering the first formal framework for token offerings under existing securities law. The CFTC opened its inaugural Innovation Advisory Committee session on Aug. 20. Three regulatory bodies, all moving in the same direction during the same week, created a policy convergence that the market had not seen before.

Senate Majority Leader John Thune filed cloture on the CLARITY Act before the August recess, setting up a procedural vote for Sept. 15. If the bill clears that hurdle, it would create the first statutory line between digital commodities overseen by the CFTC and investment contract assets under the SEC. Bitcoin, along with ether, XRP, SOL, and DOGE, would be permanently classified as non-securities under the bill’s ETP grandfather clause.

The opposing case: why this rally could reverse Not everyone agrees that bitcoin has become a fiscal hedge. Several structural risks could undermine the thesis.

The CLARITY Act faces long odds despite the White House push. Polymarket traders give the bill only a 16% chance of becoming law in 2026, down from an 82% peak in February. The core sticking point is an ethics provision targeting presidential crypto income. If the September 15 cloture vote fails, analysts have warned of a 15% to 30% market correction as the industry faces another year of regulation by enforcement.

The rally itself was heavily amplified by leverage. More than $3 billion in short positions were liquidated across crypto derivatives exchanges, affecting 170,237 traders. Binance alone processed over $1 billion in liquidations. When that much of a move is driven by forced buying from liquidated shorts rather than organic demand, the price can reverse just as violently.

Bitcoin also remains 37% below its all-time high of $126,198 set on Oct. 6, 2025. The rally brought BTC back to levels last seen in May, but it has not yet proven it can sustain prices above $75,000 during a period of thinner weekend liquidity.

There is also the question of bitcoin’s own supply dynamics. The 2024 halving reduced block rewards to 3.125 BTC, tightening new issuance. But Strategy, the largest corporate bitcoin holder, has been a net seller in recent months. If large holders use the rally as an exit opportunity, supply could overwhelm the ETF bid.

Finally, the fiscal-hedge narrative requires bitcoin to behave differently than it has during prior stress events. In the first half of 2026, gold outperformed bitcoin by a wide margin, gaining roughly 32% while bitcoin fell nearly 46% from its August 2025 levels. Central banks continued to accumulate gold, not bitcoin, as their reserve hedge of choice. No central bank has added bitcoin to its official reserves. The correlation may be rising, but the track record is still mixed.

The week’s real lesson The most revealing aspect of this week was not bitcoin’s price. It was the market’s interpretation of why it moved.

In 2020, bitcoin rallied on stimulus checks and retail euphoria. In 2024, it rallied on ETF approval and halving-cycle anticipation. In August 2026, it rallied because the U.S. Treasury signaled it would absorb long-duration bond risk to keep yields from spiraling, and the market read that as a confession that the fiscal trajectory is unsustainable.

That is a different kind of rally. It suggests that bitcoin is beginning to price not as a technology bet or a speculative vehicle but as an instrument of fiscal dissent, a way for capital to express the view that sovereign debt is no longer risk-free.

Whether that view proves correct depends on variables that no one can forecast with precision: the path of interest rates, the outcome of the CLARITY Act vote, the willingness of Congress to address structural deficits, and the Federal Reserve’s response at Jackson Hole and beyond. But the fact that $1.9 billion in ETF inflows arrived in four days tells you something about where institutional conviction is landing.

The bitcoin price prediction models that project a base-case target of $75,929 by year-end now look conservative. If the buyback program expands further, if the CLARITY Act clears its September vote, and if the Fed signals rate cuts at Jackson Hole, the conditions for a sustained rally above $80,000 are in place.

The conditions for a reversal are also in place. That tension is what makes this a trade, not a certainty.

What to watch Sept. 9 buyback launch: The expanded Treasury buyback schedule takes effect. Watch whether the Treasury increases operation sizes beyond $4 billion, which would confirm Bessent’s hint and likely push yields lower.

Sept. 15 CLARITY Act cloture vote: A successful vote would remove the largest regulatory overhang on crypto markets. A failure would likely trigger the 15% to 30% correction analysts have warned about.

Jackson Hole commentary: The Federal Reserve’s annual symposium in late August will signal whether rate cuts are on the table for Q4. A dovish tilt would reinforce the fiscal-fear trade.

Weekly ETF flow data: Sustained inflows above $500 million per day would indicate the institutional bid is structural, not reactive. A sharp reversal in flows would suggest the rally was leverage-driven and vulnerable.

30-year Treasury yield: If yields fall below 4.90%, the opportunity cost of holding bitcoin drops further and the fiscal-hedge narrative strengthens. If yields climb back above 5.20%, the buyback program is failing to contain the bond market and risk assets face pressure.

Why is bitcoin rallying in August 2026? Bitcoin gained 27% between Aug. 17 and Aug. 21 after the U.S. Treasury doubled its long-term bond buyback program from $2 billion to $4 billion per operation. The move compressed yields, weakened the dollar, and triggered $3 billion in short liquidations across crypto derivatives exchanges. Spot bitcoin ETFs absorbed $1.9 billion in four days.

What is the Treasury buyback program? The Treasury’s liquidity support buyback program involves purchasing older, less liquid government bonds and replacing them with newly issued debt. On Aug. 19, 2026, the Treasury doubled the maximum per-operation size to $4 billion for 10-to-30-year securities and increased the number of quarterly operations from two to four.

How much money flowed into bitcoin ETFs during the rally? U.S. spot bitcoin ETFs recorded approximately $1.9 billion in net inflows from Aug. 18 through Aug. 21. BlackRock’s IBIT captured the largest share, pulling in $606 million on Aug. 20 alone, an 82% market share. IBIT’s cumulative net inflows reached $62.43 billion.

What did Ray Dalio say about bitcoin and the debt crisis? On Aug. 21, 2026, Ray Dalio warned that a U.S. debt crisis could arrive “in three years, give or take two.” He recommended investors hold 10% to 15% of their portfolios in gold and “a bit” of bitcoin, calling the government’s financial condition “at an inflection point.”

How large is the U.S. national debt? U.S. national debt crossed $40 trillion on Aug. 18, 2026, just five months after passing $39 trillion. Interest payments have surpassed Medicare as the second-largest federal budget item. The government spends approximately 40% more than it collects in revenue.

Is bitcoin a better hedge than gold? Bitcoin and gold rose together during the August rally, with their correlation reaching approximately +0.7. However, gold has outperformed bitcoin over the trailing 12 months by a significant margin, and central banks continue to favor gold for reserve allocations. The two assets serve complementary roles in a fiscal-hedge portfolio.

What is the CLARITY Act and why does it matter for bitcoin? The Digital Asset Market Clarity Act would create the first comprehensive regulatory framework for crypto in the United States, dividing oversight between the SEC and CFTC. A cloture vote is scheduled for Sept. 15, 2026. Passage would remove a major regulatory overhang; failure could trigger a 15% to 30% market correction.

How many traders were liquidated during the bitcoin rally? More than 170,000 traders were liquidated across crypto derivatives exchanges during the Aug. 19-20 rally, with total liquidations exceeding $3 billion. Short-position holders accounted for $2.74 billion in losses. Binance led with over $1 billion in liquidations, followed by Hyperliquid at $701 million. This is educational analysis, not investment advice.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments carry significant risk, including the potential loss of principal. Past performance does not guarantee future results. Always conduct your own research before making investment decisions. Published Aug. 23, 2026.

Bitcoin

24 August 2026 | 00:19 Bitcoin Core developers are currently debating whether to keep support for CJDNS, an encrypted peer-to-peer routing protocol, after automated network checks revealed a surprisingly small population of active nodes.

While no code has been removed and no final decision has been made, the low adoption metrics have forced contributors to re-examine the practical security and engineering trade-offs of maintaining legacy overlay networks inside the main Bitcoin client.

Key Takeaways A recent seeder database check found only seven “good” CJDNS nodes, highlighting minimal active adoption on the network. Thin peer pools undermine security by making it dramatically easier for malicious actors to isolate and manipulate CJDNS-only nodes. Developers are weighing code complexity and bug risks against keeping an alternative routing network available during emergencies. The proposal concerns node networking and transport protocols only; it does not affect block validation, transaction rules, or core consensus. Seven “good” nodes trigger a broader infrastructure audit The technical discussion began in an open GitHub issue when developers questioned whether Bitcoin Core should continue supporting an encrypted routing layer that sees almost no documented real-world traffic. The core objective of adding alternative network transport layers to Bitcoin is to guarantee redundancy, preventing any single point of network-level failure or censorship. However, redundant routes only function if there is an active mesh of peers participating on the underlying network.

During automated testing of a CJDNS-only node setup, Core developer Marco Falke reported that his instance was unable to establish connections with more than three or four distinct peers at any given time. Following up on the observation, another contributor queried an established network seeder database containing 25 known CJDNS addresses. Out of the 25 addresses tested, 22 responded to basic handshakes, but only seven met the technical criteria required to be classified as reliable, “good” peers for active block and transaction propagation.

It is important to understand that a single seeder query does not represent an absolute census of every operating node across the entire CJDNS ecosystem. Private, non-advertised nodes and unindexed peers may still exist outside public seeder lists. Nevertheless, the low numbers underscore a serious practical reality: an overlay network with fewer than a dozen accessible routing targets fails to provide the operational redundancy required for a resilient production node.

Understanding CJDNS: Encrypted IPv6 routing vs. consensus rules CJDNS is an encrypted IPv6 mesh-network overlay that uses public-key cryptography for address allocation and distributed routing. Bitcoin Core added native CJDNS support in version 23.0 in 2022, letting node operators route peer traffic over CJDNS alongside IPv4, IPv6, Tor and I2P.

Bitcoin Core’s documentation says CJDNS encrypts traffic end to end and can make traffic analysis and filtering harder. It is not an anonymity network in the same sense as Tor, however: intermediate CJDNS routers can still see the cryptographic source and destination addresses of packets they forward.

The proposal concerns only how Bitcoin Core finds and connects to peers. Removing CJDNS support would not change block validation, mining, script rules or transaction formats; nodes would continue enforcing the same Bitcoin consensus rules.

The security mechanics of an eclipse attack In Bitcoin node security, network transport and peer selection are directly tied to data integrity. Encryption hides packet contents from third parties, but it does not protect a node from being fed false or delayed information if its selection of peers is too restricted.

A primary threat to isolated nodes is an eclipse attack. In an eclipse attack, an adversary compromises or controls all of the peer connections established by a target node. By surrounding the target node completely, the attacker effectively partitions it from the legitimate global Bitcoin network. From this vantage point, the attacker can manipulate the victim’s view of the blockchain by delaying block announcements, censoring specific incoming transactions, or attempting double-spend attacks against unconfirmed transactions.

Under standard IPv4, IPv6, or Tor routing, Bitcoin Core mitigates eclipse attacks by establishing multiple independent connections across diverse netgroups and network ranges. But when a node operates exclusively over a network with only seven reliable peers, the total pool of available connections is far too small. An attacker needs very few resources to monopolize all incoming and outgoing connections of a CJDNS-only node, turning an intended security fallback into a significant single-point failure vector.

Code complexity and the case for deprecation In addition to low adoption figures and security concerns, developers advocating for removal emphasize the ongoing maintenance burden that CJDNS code imposes on the overall Bitcoin Core software repository.

Unlike standard protocol handlers, CJDNS integration is not completely isolated from standard IPv6 connection logic. Because CJDNS uses specially formatted IPv6 addresses, the codebase requires custom handling logic, dedicated launch arguments like -cjdnsreachable, and specialized edge-case workarounds. Over time, developers have noted that these custom logic paths introduce bug risks and complicate routine refactoring of the networking stack.

Several Core contributors have offered a “Concept ACK” toward deprecating the protocol. In open-source Bitcoin Core development terminology, a “Concept ACK” indicates that a contributor agrees with the high-level goal of a proposal; it does not constitute a final vote, a code merge, or an immediate commitment to remove the feature.

The case for long-term emergency reserves On the other side of the issue, developers urging caution argue that node utility should not be judged exclusively by current traffic metrics. Contributor Jon Atack pointed out that automated CJDNS peer discovery was only integrated into Core in early 2025. Prior to that update, node operators had to manually configure peer addresses, a process that created a significant barrier to entry compared to single-click Tor or I2P setups.

Proponents argue that CJDNS’s low usage numbers stem from a lack of user awareness and limited integration in popular turn-key node software distributions, rather than a lack of underlying value. If major public anonymizing networks like Tor or I2P were to experience centralized blocking, infrastructure outages, or nation-state level filtering, alternative mesh protocols like CJDNS could provide a vital emergency fallback channel for maintaining peer connections.

Furthermore, Atack volunteered to personally maintain the CJDNS integration code, addressing concerns regarding developer overhead. Core contributors must now decide whether to preserve an alternative transport route for edge-case emergencies or streamline the codebase by removing low-usage network logic.

What a potential removal means for node operators If Bitcoin Core ultimately decides to remove native CJDNS integration in a future release, the software will simply stop managing CJDNS peer connections internally within the application tier. The change would not prevent operators from running CJDNS externally at the operating system level, nor would it alter how the broader Bitcoin network processes transactions.

For the vast majority of node operators who rely on standard IPv4, IPv6, Tor, or I2P connections, the removal of CJDNS would pass completely unnoticed. The ongoing discussion simply reflects Bitcoin Core’s rigorous engineering philosophy: every line of code must justify its existence through proven security and active utility.

This article is provided for informational purposes only and does not constitute investment advice.

Author

Kosta has reported on cryptocurrency markets and blockchain infrastructure since 2020, bringing over six years of hands-on experience in the crypto industry built through daily tracking of markets, trends, and emerging blockchain developments. Specializing in Bitcoin on-chain analysis, institutional ETF flows, and digital asset price action, his work at Coindoo has been cited by other news agencies and consistently covers market developments with a focus on data-driven reporting across Bitcoin, Ethereum, Solana, and XRP. Over the years, Kosta has contributed to multiple crypto media outlets in different regions, authoring over 6,000 articles across the sector. His reporting spans cryptocurrency markets and the broader fintech industry, tracking not only price action but also the technological and regulatory forces shaping the ecosystem. To support his analysis, Kosta actively leverages on-chain data and metrics from leading platforms such as Santiment, Glassnode, and CryptoQuant, enabling deeper, evidence-based market insights. He believes in the power of transparency and the data that underpins the blockchain ecosystem. His academic background in Marketing Management from Denmark further complements his analytical approach, adding a strong understanding of communication strategy and content positioning to his work.

Tether’s two Uruguay mining sites cost an estimated $120 million. A dispute with state utility UTE centered on how much electricity the sites could draw. UTE disconnected both facilities in July 2025 after bills went unpaid. Tether has continued pursuing Bitcoin mining elsewhere in South America. Tether’s attempt to establish Uruguay as a launchpad for a larger South American Bitcoin mining business ended with two abandoned facilities after a contractual dispute with state-owned electricity provider UTE. The sites, estimated by a person with direct knowledge to have cost about $120 million, lost power in July 2025, according to documents and interviews reviewed by Reuters, turning what began as a renewable-energy mining expansion into a costly example of how electricity contracts can determine the economics of industrial-scale Bitcoin production.

A Power Contract Became the Project’s Central Problem When Tether announced its Uruguay expansion in 2023, the country appeared well suited to the company’s mining ambitions. Uruguay offered political stability, a reliable electrical grid and a power system with substantial renewable generation.

The two facilities were built in the department of Florida, with a former contractor estimating investment of roughly $60 million in each site. Uruguay was intended to serve as a testing ground before Tether expanded further into countries including Brazil, Paraguay and Argentina.

Operations initially generated revenue, according to former contractors interviewed by Reuters. The problem emerged as electricity requirements increased.

Tether and UTE interpreted a critical part of their electricity agreement differently. Tether understood the contracted power figure as a minimum allocation that could eventually be expanded. UTE regarded it as the maximum amount of electricity available to Tether’s local entity, Microfin.

That distinction became increasingly important as the mines scaled. Bitcoin mining facilities need a large and predictable electricity supply because their economics depend heavily on keeping specialized machines operating continuously. According to Reuters, insufficient supply sometimes left the sites without enough electricity for days.

Key stages in the Uruguay project May 2023
Tether announces Bitcoin mining operations in Uruguay.

November 2024
The electricity supply dispute is documented by UTE.

May 2025
Microfin stops paying its electricity bills.

July 25, 2025
UTE disconnects electricity to the mining sites.

November 2025
Tether notifies authorities that operations will cease and most employees will be laid off.

Why Negotiations Failed Despite a Revised Electricity Deal The disagreement did not immediately end the project. UTE and Tether attempted to renegotiate the arrangement, and the utility’s board approved both a memorandum of understanding and revised contract documents.

The agreement was never completed.

According to minutes cited by Reuters, Tether representatives did not attend the planned signing. By that stage, Microfin had already stopped paying electricity bills and had informed UTE in June that it intended to terminate the contracts.

With the revised agreement unsigned and bills outstanding, UTE cut electricity to the facilities on July 25, 2025. Microfin subsequently settled its outstanding debt in December, UTE told Reuters.

The chronology matters because the shutdown was not simply the result of Uruguay lacking enough renewable electricity. The underlying problem was whether Tether could secure sufficient power under terms that made expanding its mining operation commercially workable.

Uruguay Exposed the Economics Behind Tether’s Mining Strategy Bitcoin miners effectively convert electricity and computing capacity into BTC. That makes the cost and reliability of power fundamental to profitability.

The April 2024 Bitcoin halving made that calculation harder by reducing the block subsidy from 6.25 BTC to 3.125 BTC. Unless higher Bitcoin prices, transaction fees or improved mining efficiency compensate for the reduction, miners earn fewer coins from the same amount of computational work.

Uruguay offered extensive renewable generation, but renewable electricity is not automatically cheap electricity.

Crypto mining specialist Nicolas Ribeiro told Reuters that Uruguay’s relatively high power costs make the country less competitive for Bitcoin mining, while its stable grid and internet infrastructure may be better suited to AI data centers. Mining operators have fewer reasons to remain in a particular jurisdiction when electricity becomes uneconomical because much of their computing hardware can be relocated.

That flexibility helps explain why the collapse of the Uruguay project has not ended Tether’s broader energy strategy.

Tether Has Already Shifted Mining Investment Elsewhere The failed project also needs to be viewed against the scale of Tether’s wider expansion.

CEO Paolo Ardoino said in June 2025 that Tether had invested more than $2 billion in energy and mining infrastructure across 15 sites in Uruguay, Paraguay and El Salvador, according to The Block. The company has pursued mining infrastructure as one component of a much broader investment portfolio.
Brazil has become one of the next areas of focus.

In July 2025, Tether and agricultural and renewable-energy producer Adecoagro signed a memorandum of understanding to explore using renewable electricity for Bitcoin mining. The proposed model centers on monetizing surplus electricity from Adecoagro’s renewable-energy portfolio rather than reproducing the same arrangement used in Uruguay.

Tether had previously acquired a controlling stake in Adecoagro, giving it a more direct connection to the underlying energy assets.

The distinction could prove significant. Greater control over energy generation may reduce some of the contractual dependency that affected the Uruguay sites, although it does not eliminate mining’s exposure to

Bitcoin prices, network difficulty, equipment efficiency and local electricity economics.

What Changes Next for Tether’s Bitcoin Mining Plans The Uruguay exit leaves Tether with a more fragmented South American mining strategy than originally envisioned. Instead of using one country as a regional testing ground and then replicating the model, the company is pursuing different energy arrangements across individual markets.

For the mining industry, the episode reinforces why headline renewable-energy capacity is not enough when evaluating potential jurisdictions. Large operators need contractual certainty over both electricity prices and how much power they can consume as facilities expand.

Tether’s next South American projects will therefore provide a clearer test of whether greater involvement in energy production can improve those economics. Its partnership with Adecoagro is particularly relevant because the companies plan to examine whether surplus renewable electricity can be converted into Bitcoin mining revenue, giving Tether a different operational model from the one that failed in Uruguay.

In brief In an interview with Decrypt, Bitcoin Red Team member Calle said Chinese AI models are used far more than U.S. models for security research because American models often block cybersecurity-related requests. The group has proactively scanned much of Bitcoin's significant open-source ecosystem and works directly with projects to identify and fix vulnerabilities. Calle warned that AI allows people without advanced security expertise to carry out exploits from beginning to end. AI is putting powerful hacking capabilities in the hands of people with little cybersecurity expertise, forcing crypto developers into a race to find vulnerabilities before attackers exploit them.

One group taking on that challenge is the Bitcoin Red Team, whose pseudonymous member and Bitcoin software developer Calle said formed as an emergency effort to find AI-assisted security threats across the Bitcoin ecosystem.

Myriad: Bitcoin price next move? Click to make your prediction."At this point, it is a question about time,” Calle, who helps maintain the open-source protocol Cashu, told Decrypt. “The reason why the Bitcoin Red Team exists right now is because we need to get ahead of the attackers as fast as possible.”

The Bitcoin Red Team consists of about 20 to 25 volunteers, according to Calle, many of whom prefer to remain pseudonymous, such as Bitcoin privacy protocol developers Stu, Talip, and fellow Cashu dev thesimplekid. Others in the group include Bitcoin developers Ben Carmen, Daniela Brozzoni, and James O'Beirne, and Vinteum Bitcoin R&D Center board member Bruno Garcia.

Bitcoin Red Team Update:

We have been working around the clock, with ~$20,000 of spend up to this point across different services. Funding is secured, I appreciate all the gestures for donations but it is not necessary. The bill is taken care of.

We have done over a dozen…

— Rob Hamilton 🟥 (@Rob1Ham) August 4, 2026

Calle said the Bitcoin Red Team began taking shape after CEO of Bitcoin Insurance firm AnchorWatch Rob Hamilton started examining Bitcoin projects following the Coldcard air-gapped wallet hack.

While Calle stressed that the group has found no issues in the Bitcoin protocol itself, the concern he said instead lies with applications, wallets, services, and other software built around Bitcoin.

"Although Bitcoin itself is secure, the software that we're using to transact with Bitcoin may not be, and that is what most people interface with anyway," Calle said.

The Coldcard exploit, attacks on other Bitcoin services, and the release of more powerful Chinese AI models pushed Calle and other security researchers to join the effort and move quickly.

"I think the arrival of Kimi K3 has also caused a lot of chaos in the cybersecurity realm because it gave attackers as well as defenders unprecedented power," he said.

As Calle explained, the Red Team receives requests from Bitcoin projects seeking security scans but also searches for vulnerabilities on its own.

"We get a bunch of inbound requests from projects that want to be scanned, but we act proactively, and we've covered almost the entire significant open-source ecosystem by our own sweeps already," Calle said. "So even if you come and ask us to scan your project, we've probably scanned it already."

The group shares its findings with affected developers and uses their feedback to improve its vulnerability classifications and severity ratings.

Chinese models fill the gap

Chinese AI models are used far more than their U.S. counterparts for the group's security work because guardrails on American models can block cybersecurity research, Calle said.

“It's not even close," he said.

In February, Anthropic accused Chinese AI labs DeepSeek, Moonshot AI, and MiniMax of using roughly 24,000 fraudulent accounts to extract more than 16 million Claude exchanges through model distillation, while the Trump administration warned in April that Chinese entities were conducting similar campaigns on an “industrial scale.”

Myriad: When will OpenAI release GPT-6? Click to make your prediction.While Calle said U.S. frontier models remain arguably more capable overall, their restrictions can limit their usefulness for security-sensitive work.

"Although U.S.-based frontier models are still arguably more intelligent than any other models out there in the world, they all come with heavy guardrailing, which limits their use, especially in the cybersecurity realm," he said.

Calle encountered those restrictions before joining the Red Team. He said U.S. models sometimes refused to help find vulnerabilities and, in some cases, would not assist with fixing vulnerabilities that developers had already identified, leading him to switch to Chinese AI models.

'Bitcoin is burning'

Earlier this month, Calle described the growing security threat facing Bitcoin software as "Bitcoin is burning," referring to the wider ecosystem of wallets, exchanges, Lightning implementations and other software built around it.

Calle believes attackers are already using AI to find and exploit vulnerabilities, but avoids discussing their methods in detail out of concern that doing so could give malicious hackers ideas.

He also warned that AI is eroding the information advantage that once kept some software vulnerabilities out of reach of less-skilled attackers.

"I think that there are no secrets anymore in software," Calle said. "There is no information asymmetry that was previously being used to kind of create security theater or security through obscurity. Those times are over."

AI has also lowered the technical barrier to exploiting vulnerable software, he said.

"Simple exploits can now be completed end to end by someone who doesn't know how to do it without AI," Calle said. "So AI gave people a form of power that has completely changed the playing field."

Bitcoin may be confronting that shift earlier than other industries because attackers have a direct financial incentive to target cryptocurrency, Calle said.

"The first thing that, as an attacker, you would want to attack is internet money," he said. "So we are the beginning of a larger change in society or in computer systems in general, and I'm convinced that other industries will experience the same thing as we do right now later."

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Key Highlights Bitcoin climbed approximately 25% this week, reaching nearly $80,000 following expanded U.S. Treasury buyback operations on long-term bonds Approximately $4 billion worth of short positions in cryptocurrency markets faced forced liquidation amid the price surge U.S. spot Bitcoin ETFs recorded $1.6 billion in net inflows over the past week Strategy’s 840,447 BTC position has returned to profitability with more than $2 billion in unrealized gains Market analysts attribute the rally partially to a historic short squeeze alongside improving macroeconomic factors Bitcoin experienced a significant rally this week, climbing approximately 25% to surpass $78,000 and briefly touching $79,500, following a strategic policy adjustment by the U.S. Treasury that helped ease long-term government bond yields from nearly two-decade peaks.

Bitcoin (BTC) Price The Treasury Department revealed plans to expand its buyback program for longer-maturity government securities, increasing the purchase amount to $4 billion per operation—double the previous $2 billion level. This policy change contributed to a decline in the 30-year Treasury yield from 5.34% to approximately 5.19%.

BREAKING: US Treasury Secretary Bessent says Treasury buybacks announced yesterday could now MORE than double, exceeding $4 billion per operation.

Bessent said buybacks will increase “by at least double,” adding, “we have a big toolkit, so we’ll see.”

This comes just hours… https://t.co/SLNs0MfTgD

— The Kobeissi Letter (@KobeissiLetter) August 20, 2026

The announcement catalyzed significant forced buying activity as bearish market participants faced liquidation. Approximately $4 billion in short cryptocurrency positions were forcibly closed during Thursday and Friday trading sessions.

Market observers provided perspective on the price movement. Shawn Young, chief analyst at MEXC Research, remarked that “The Treasury opened a pressure valve, and crypto priced it like a regime change.” He cautioned that Bitcoin’s advance toward $70,000 may be premature considering Treasury yields remain near 5%.

Jeff Ko, chief analyst at CoinEx, characterized the buyback announcement as “a signal, a soft policy put on the long end,” emphasizing that it doesn’t represent a fundamental transformation in financial conditions and shouldn’t be confused with quantitative easing.

Spot ETF Demand Surges U.S. spot Bitcoin exchange-traded funds registered $1.6 billion in net inflows throughout the week. BlackRock’s IBIT fund alone attracted $503 million on Thursday. Total ETF assets under management increased above $85 billion, up from approximately $70 billion in June.

Market analyst Ted Pillows highlighted on X that ETFs accumulated $1.92 billion worth of BTC this week—representing the strongest weekly inflow since October 2025. He emphasized that Bitcoin successfully breached multiple significant resistance levels, with the $78,000–$80,000 zone emerging as the crucial range to monitor. Sustained trading above this level, according to Pillows, would signal the conclusion of the bear market.

$BTC weekly candle is just insane.

Breaking above every resistance level like it's nothing.

Now, Bitcoin is moving towards its $78,000-$80,000 resistance zone.

A reclaim of this will confirm the end of this bear market. pic.twitter.com/lxvivlLMkb

— Ted (@TedPillows) August 21, 2026

Financial research firm Bernstein connected the price recovery to enhanced market liquidity, renewed ETF demand, and a more favorable regulatory environment. Their analysts anticipate expedited SEC and CFTC regulatory development in areas including tokenized securities and prediction markets.

Strategy’s Bitcoin Position Returns to Profit Strategy maintains a position of 840,447 BTC bought at an average cost basis of $75,385. With Bitcoin trading near $78,000, the company’s holdings show an unrealized gain exceeding $2 billion.

The company recently divested approximately 0.8% of its Bitcoin holdings to fund dividends and repurchase programs for its STRC preferred shares. Bernstein analysts project that Strategy will resume acquisition activity as STRC approaches its $100 nominal valuation.

Ko identified Bitcoin’s 200-day moving average, positioned near $69,000, as a critical technical benchmark. Bitcoin has successfully cleared this threshold and must maintain support above it while competing against government bonds offering nearly 5% yields to investors.

Pakistan has announced a new regulatory framework for crypto after banning the asset class for close to a decade, 

Announcing the news in an X post Friday, Bilal Bin Saqib, the special assistant to the prime minister on blockchain and cryptocurrency, invited foreign businesses to come to the country and set up shop.  

Pakistan’s Virtual Assets Act introduces the country’s first comprehensive legal framework for overseeing virtual assets and the businesses that operate in this space. 

8 years of prohibition end today.

Chairman PVARA @BilalBinSaqib announces the notification of the Licensing Regulations and the opening of the licensing portal, and sets out what licensing requires of providers and what it guarantees consumers.

Get licensed. Get compliant. Come… pic.twitter.com/STVPsoX1so

— Pakistan Virtual Assets Regulatory Authority (@PakistanVARA) August 21, 2026 “For approximately a decade, Pakistan’s answer to virtual assets was complete permission and complete ban — but history tells us that technology never waits for permission,” Bin Saqib said. 

He added: “To the companies watching Pakistan from outside, the front door is open for you. Come, get licensed. Come, get banked. Come, build here under rules that are clear, public and enforceable.” 

In a separate post, Bin Saqib said that the country now has “the rules, the regulator and the licensing framework to bring virtual assets into the formal economy, protect consumers and build the foundation for the next generation of financial infrastructure.”

Pakistan’s virtual Assets Act was approved by the senate earlier this year and then signed into law by President Asif Ali Zardari. Friday’s announcement indicates that licensing regulations are now in place. 

Pakistan has made a crypto-friendly pivot in recent years. In 2025, plans to launch a national strategic Bitcoin reserve were announced at the Bitcoin 2025.

Before that, the country announced that it was allocating 2,000 MW of surplus electricity to Bitcoin mining and AI data centers in an initiative aimed at generating revenue, creating jobs, and attracting foreign investment, according to the Pakistani government.

The country has played an important part as a mediator between the U.S. and Iran. A relationship started forming between the two after it became an affiliate of Trump-backed crypto project, World Liberty Financial. 

Weeks after President Donald Trump’s return to power last year, WLF leaders went to Islamabad to meet with Pakistan’s prime minister. 

Mathew Di Salvo

Mathew is a reporter who's covered the space since 2019, reporting on everything from Salvadoran president Nayib Bukele's Bitcoin bet to crypto exchange FTX's bankruptcy.

In brief Coinkite released new Coldcard firmware after a seed-generation flaw exposed users to more than $100 million in Bitcoin thefts. Coldcard now requires users to add randomness through key presses, dice rolls, or coin flips when generating new seeds. A three-week review also uncovered issues involving transaction signing, USB connections, backups, and other wallet functions. Coldcard maker Coinkite has released a security overhaul for its Bitcoin hardware wallets after a seed-generation flaw allowed attackers to steal more than $100 million in Bitcoin.

In a blog post on Thursday, Coinkite urged Coldcard Mk4, Mk5, and Q users to upgrade to firmware 5.6.1 or 1.5.1Q. The release follows a three-week review of Coldcard's systems that included outside security researchers and AI models including Kimi.

Myriad: Bitcoin price next move? Click to make your prediction.“We are grateful to the security researchers who went above and beyond over the past weeks, reporting issues, reproducing edge cases, and reviewing our fixes,” the company wrote. “Their work put this firmware under intense, sustained scrutiny and made this release stronger.”

In July, attackers began draining Bitcoin from air-gapped Coldcard wallets after exploiting a firmware flaw dating to 2021 that generated some wallet seeds with too little randomness, making their private keys easier to guess. The first attack drained 594 BTC, worth about $38 million, from roughly 500 wallets in 25 minutes.

Coinkite suggested that the attackers may have used AI to examine older versions of its open-source firmware and uncover the flaw.

By early August, Galaxy Research had tracked roughly $88.6 million stolen across 4,585 addresses and said the attacks appeared deliberate, programmatic, and potentially orchestrated using a large language model.

The research company continued tracking losses and by August 14 said attackers had stolen more than 1,778 BTC, worth roughly $112 million at the time, across three major attack waves and dozens of smaller incidents.

All told, the Coldcard exploit has now resulted in roughly $130 million in stolen Bitcoin and raised questions about entropy—the randomness used to generate wallet keys. On some affected devices, the flaw reduced security from 128 bits of entropy to roughly 40 bits, making wallet seeds easier for attackers to guess without physical access to the device.

Coinkite said it fixed issues involving transaction signing, USB data handling, firmware validation, Delta Mode, and wallet backups. Coldcard now also requires users to add randomness when generating a wallet seed using at least 65 key presses, 50 dice rolls, or 128 coin flips, which the device combines with its own randomness.

The hardware wallet maker also replaced its Yasmarang backup pseudo-random number generator with SHA-256 Hash_DRBG and added checks intended to catch failures in the hardware random number generator. Users who may have generated seeds on affected versions between 2021 and July 2026 must create a new seed using updated firmware and move their Bitcoin, the company said.

More than seed generation

Coldcard now checks a partially signed Bitcoin transaction, or PSBT, immediately before signing it. Previously, a compromised computer connected over USB could theoretically change a transaction after the user reviewed it but before the Coldcard signed it.

The updated firmware stops the signing process and displays a warning if the transaction has changed. Coinkite described the issue as theoretical and did not say it had been exploited.

Coinkite also tightened USB data access, hardened Delta Mode, and changed how Coldcard handles wallet backups.

While AI has played a role in patching vulnerabilities, it also plays a role on both sides of cybersecurity and cryptography.

Myriad: Will Strategy hold over 1M BTC? Click to make your prediction."We're treating this as a serious reminder of how the whole security model of a hardware wallet lives or dies on randomness," Ledger CTO Charles Guillemet told Decrypt. "Cryptography is hard and implementing it securely is harder. This week's Coldcard incident made that visible in the most expensive way possible."

Earlier this month, swap service Boltz suspended operations after saying AI-assisted attackers were finding bugs faster than its developers could fix them. A volunteer Bitcoin Red Team also used AI agents to identify thousands of potential vulnerabilities across hundreds of Bitcoin projects.

Coinkite said the investigation into the thefts remains ongoing as affected customers continue moving funds to new wallets.

“Law enforcement authorities continue investigating the thefts and are working to identify those responsible,” Coinkite said. “We remain available to assist, and authorities are keeping us informed of material developments,” adding that the company “remain committed to supporting every customer working through their migration until it’s done.”

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The SEC has opened a public comment period on Cboe BZX Exchange’s proposal to list six daily 3x leveraged Bitcoin and Ethereum futures ETFs.

The proposal, filed under SR-CboeBZX-2026-065, would cover commodity-pool products sponsored by Volatility Shares. The funds would seek three times the daily performance of front-month and next-month CME Bitcoin and Ethereum futures contracts, using daily reset mechanics.

That is a very different product from a spot ETF.

A 3x leveraged futures ETF is built for short-term tactical exposure. It is not a simple buy-and-hold wrapper for Bitcoin or Ethereum, and its daily reset structure can create performance drift over time.

The SEC’s move opens the proposal for public comments. It does not mean the products have been approved.

TL;DR The SEC opened comments on Cboe’s proposal for 3x leveraged BTC and ETH futures ETFs. The proposed products would be sponsored by Volatility Shares. The filing is under review and has not been approved. Why Leveraged Crypto ETFs Matter Leveraged ETFs are popular because they give traders amplified exposure without directly using margin or futures accounts.

In crypto, that can be especially attractive because Bitcoin and Ethereum already move sharply. A 3x daily product would magnify those moves, creating potential for larger gains and larger losses in a traditional brokerage format.

That is exactly why regulators pay attention.

Leveraged products can be misunderstood by retail investors. They are designed to track daily performance, not long-term cumulative returns. Over multiple sessions, compounding and volatility can cause results to diverge from what investors might expect.

That risk becomes more important when the underlying asset is already volatile.

Futures, Not Spot The proposal concerns futures-based products, not spot Bitcoin or spot Ethereum ETFs.

That distinction matters because the funds would use CME futures exposure rather than directly holding BTC or ETH. Futures-based exposure can behave differently from spot assets because of roll costs, margin, contract structure, and futures-market dynamics.

Investors may see “Bitcoin ETF” or “Ethereum ETF” and assume direct asset exposure.

That would be inaccurate.

These would be leveraged futures products tied to daily movements in futures contracts.

The Comment Period Is Only One Step A public comment period gives market participants, investors, issuers, competitors, and other stakeholders a chance to respond to the SEC.

Comments may address investor protection, market manipulation, disclosure, suitability, volatility, liquidity, and exchange-listing standards.

The SEC can approve, reject, delay, or request changes.

So the current development is procedural but important. It shows the proposal is formally in the review pipeline, but it does not indicate the regulator has accepted the structure.

Crypto ETF Market Keeps Expanding The proposal also shows how quickly the crypto ETF market is moving beyond plain spot products.

Bitcoin spot ETFs opened the door. Ethereum followed. Now issuers are testing leveraged, inverse, staked, altcoin, and multi-asset structures.

That expansion is natural in traditional ETF markets.

Once a base asset category becomes accepted, issuers compete by offering more specialized exposures. Crypto is now entering that phase, and regulators are being asked to decide how much complexity is appropriate.

What Traders Need To Understand If products like these eventually launch, they will not be suitable for every investor.

Daily 3x leveraged funds are typically tools for active traders. Holding them over longer periods can produce unexpected results because the fund resets exposure each day.

For Bitcoin and Ethereum, that risk may be magnified by extreme volatility.

The SEC’s review will likely center on whether disclosures, exchange rules, and product design are sufficient to protect investors.

For now, Cboe’s proposal is another sign that crypto ETF experimentation is accelerating. Approval, however, is still an open question.

This article is based on the SEC’s self-regulatory organization filing notice for Cboe BZX Exchange.

This article was written by the News Desk and edited by Samuel Rae.

MANTRA (MANTRA) slid to an all-time low of $0.0041 as the project froze its blockchain and said an attacker was targeting a vulnerability in an upstream dependency.

The record low came as the rest of the market climbed, extending a rally that accelerated on Wednesday.

Why MANTRA Halted Its ChainMANTRA Chain, a Layer 1 blockchain built for tokenizing real-world assets, was halted earlier today. Its initial notice said all endpoints and transactions were frozen.

Follow us on X to get the latest news as it happens

We're aware of an incident affecting MANTRA Chain and have halted the chain as a precaution while we investigate. All endpoints and transactions are currently frozen.

This means deposits and withdrawals to/from MANTRA Chain are temporarily affected. If you're unsure how this…

— MANTRA | The EVM L1 for RWAs (@MANTRA_Chain) August 21, 2026
A later update named the cause. The team pointed to an attacker exploiting a vulnerability in an upstream dependency, meaning third-party code the chain relies on rather than software it wrote itself.

“Earlier today, we detected an attacker exploiting a vulnerability in an upstream dependency used by the chain and halted the network as a precaution,” the update read.

MANTRA said it has identified the vulnerability and is now preparing a patch. Its validators and infrastructure remain offline until the upgrade is ready. 

“Resuming the network will require a coordinated restart with the wider validator set — we will not resume until the patch is verified and that coordination is in place,” it added.

The team is also tracing where funds moved and has contacted exchange partners. Deposits and withdrawals remain paused at affected venues, and the total scope of the impact remains unconfirmed. The team also warned holders to ignore anyone offering recovery help.

MANTRA Misses a Market-Wide Rally The incident has also impacted the token. MANTRA changed hands at $0.0044 at press time, down 8.5% on the day. 

MANTRA Token Price Performance. Source: BeInCrypto MarketsThat slide ran against the broader market. Bitcoin (BTC) topped $75,000 earlier today as short liquidations reached $1.06 billion. Other major cryptocurrencies also traded higher, lifting the total crypto market capitalization by nearly 4% over the past day.

The incident marks the network’s second major crisis in 16 months. Its token, then known as OM, lost nearly 90% of its value in April 2025, wiping out about $5.5 billion in market value in less than an hour.

The project retired the OM ticker this March. A non-dilutive 1:4 split at block 13,000,000 converted each OM into four MANTRA, and the token posted a 37% launch-day rally.

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The US government’s Strategic Bitcoin Reserve is looking more like a trophy case than a war chest. Bitget CEO Gracy Chen has said she does not expect Washington to make any open-market Bitcoin purchases before the end of President Donald Trump’s current term.

That view is grounded in how the reserve was actually built. The executive order establishing it, signed on March 6, 2025, explicitly limits the reserve to Bitcoin seized or forfeited through criminal and civil asset proceedings. No taxpayer money goes in. No market orders get placed.

What the reserve actually is The US holds a substantial amount of Bitcoin accumulated through law enforcement actions, and the executive order simply formalizes the decision to keep it rather than sell it.

The order also prohibits the government from selling its holdings, which creates an interesting one-way door. Bitcoin goes in when courts rule against defendants. It does not come back out.

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As of mid-2026, no additional Bitcoin has been acquired through any purchase mechanism, and the administrative focus has stayed on building the legal and custodial infrastructure needed to manage existing holdings. Treasury Secretary Scott Bessent has voiced support for Bitcoin as a strategic asset but has stopped well short of announcing any acquisition plans.

Administration officials have privately acknowledged the reserve’s limited scale, describing its current importance as largely symbolic.

Why Chen’s read matters Gracy Chen runs one of the larger centralized crypto exchanges by trading volume. Her skepticism about near-term purchases aligns with what the executive order’s text actually says, rather than what Bitcoin advocates hoped it might eventually enable.

When the executive order dropped in March 2025, some corners of the crypto market priced in the possibility that government purchasing would follow. It has not.

Chen’s comment that purchases are unlikely before Trump’s term ends resets that expectation more explicitly. The term concludes in January 2029, and the implication is that even within a four-year window friendly to Bitcoin, the structural constraints of the current order make large-scale acquisition a low-probability event.

Open-market purchases would require Congressional authorization, budget allocation, and a public debate about using taxpayer funds to buy a volatile digital asset. None of those conversations have gained serious legislative traction.

What this means for the market The prohibition on sales does remove some supply-side uncertainty. Bitcoin held in the reserve stays there, reducing the risk that a future administration could liquidate holdings and depress prices.

Several proposals have circulated on Capitol Hill that would authorize direct purchases, funded through mechanisms that avoid direct taxpayer exposure. None have cleared committee as of mid-2026.

Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.

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JPMorgan Chase grew its position in BlackRock’s iShares Bitcoin Trust to roughly 10.4 million shares, worth about $355.7 million as of June 30, according to the bank’s second-quarter 13F filing with the SEC, filed Aug. 12. That is up from about 8.3 million shares, valued near $162 million, the prior quarter.

The crypto positions remain a small fraction of JPMorgan’s total reportable holdings, which the same filing pegs at $1.807 trillion across more than 34,000 positions, but the direction of travel points to deeper exposure to regulated crypto products.

Ether and altcoin exposure JPMorgan’s stake in BlackRock’s iShares Ethereum Trust rose more than fourfold to about 1.17 million shares, valued near $14.3 million, up 338% from the first quarter. The bank also established a new position in the Bitwise Solana Staking ETF of roughly 47,500 shares.

The filing showed a return to XRP after the bank had exited the asset entirely in Q1. The new exposure is small, spread across the Bitwise XRP ETF, the Grayscale XRP Trust ETF and a stake in Armada Acquisition Corp II, a blank-check company pursuing a deal tied to the Ripple ecosystem.

The bitcoin position still exceeds the ether stake by a wide margin, and the XRP holdings are nominal in dollar terms, but the return to the asset after a zero position is the more notable signal in the filing.

Context: institutions via ETFs 13F filings offer a quarterly snapshot of institutional holdings of U.S.-listed equities and ETFs, and banks’ crypto exposure through these vehicles reflects client-driven demand for regulated access rather than a direct endorsement of the underlying tokens. The holdings can shift between quarters as client flows and market conditions change.

What to watch next JPMorgan’s next 13F, due in mid-November, will show whether the bank continued adding to its bitcoin, ether, XRP and solana positions through the third quarter or pared back after Q2’s build-up. The filing arrives as spot bitcoin ETFs have seen volatile flows, making the bank’s positioning a useful signal of institutional sentiment. Morgan Stanley also increased its crypto ETF holdings in the same reporting period, underscoring a broader trend among large banks.

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Entrepreneur and freelance writer based in Nakuru, Kenya. I cover cryptocurrency, the Blockchain technology, and financial topics. It’s my joy to transform the simplest phrases in a way they reach a reader’s heart to help them discover how crypto is disrupting the world as we have known it. I believe in transforming the world, one word at a time.

Bitcoin climbed above $72,500 on Thursday, marking its highest price since late May. The surge came as President Donald Trump called for Congress to advance new cryptocurrency legislation and improving market conditions supported digital assets.

Major cryptocurrencies post significant gainsBitcoin rose 6.6% to reach $72,644. Ethereum increased 11%, while XRP recorded a 19% gain. The Hyperliquid token jumped 15% after President Trump stated that Commodity Futures Trading Commission Chairman Mike Selig was working to bring the decentralized exchange to the US.

The rally coincided with calls from Trump, several regulators, and key cryptocurrency executives urging Congress to pass the Clarity Act. This proposed bill would classify Bitcoin and other digital assets as commodities instead of securities. A procedural vote on the bill is set for September 15.

In contrast to the strong performance in cryptocurrencies, US equities declined. The Dow Jones Industrial Average dropped 624 points, while the S&P 500 fell 0.71% and the Nasdaq Composite slipped over 1%.

Short squeeze and market liquidity boost BitcoinBitcoin’s momentum followed the largest short-liquidation event to date in cryptocurrency markets. According to data from CoinGlass, $664 million in Bitcoin short positions were liquidated within the last 24 hours.

Crypto asset24h price gainShorts liquidatedBitcoin6.6%$664 millionEthereum11%Not statedXRP19%Not statedExpectations of lower long-term US borrowing costs also contributed to Bitcoin’s rise. The US Treasury announced it would double the size of its longer-term bond buybacks to help arrest climbing yields. Lower bond yields generally favor cryptocurrencies by making traditional interest-bearing assets less attractive and increasing overall market liquidity.

Despite Thursday’s rally in bond yields placing pressure on stocks, cryptocurrencies largely maintained their upward trajectory. Gideon Hyams, chairman and co-founder of STS Digital, remarked that the short squeeze initiated the rally but noted that additional factors were sustaining it.

Squeezes start rallies, but they don’t sustain them, and this one has more behind it than forced buying, said Hyams, highlighting falling long-term yields, renewed ETF inflows, and greater regulatory clarity as supporting elements for Bitcoin’s upward trend.

Nicolai Søndergaard, senior research analyst at Nansen, agreed that increased short covering accelerated Bitcoin’s breakout yet emphasized that strong spot and ETF demand were also critical drivers.

Mini dictionary: STS Digital is a digital asset management and research firm focused on cryptocurrency markets, offering insights and investment solutions tailored to institutional clients.

Key tests ahead for the Bitcoin rallyWhile the price jumped sharply, analysts are monitoring whether Bitcoin can retain its gains after the impact of the short squeeze fades. Søndergaard noted that the technical outlook for Bitcoin has improved but warned that leveraged long positions are becoming crowded. He suggested that ongoing strong spot buying will be crucial for the cryptocurrency to remain above the $70,000 mark.

Sustained acceptance above $70,000 would keep the outlook constructive, while a pullback toward the 69,700–69,000 area would be a normal test of the breakout rather than an automatic trend reversal, Søndergaard stated.

Ki Young Ju, founder of CryptoQuant, said demand for Bitcoin has turned positive in both spot and perpetual futures markets for the first time since October 2025’s record highs. However, he pointed out that the current scale of demand is still modest and suggested that if this continues for another month, a new bull cycle could be confirmed.

Technical trends are also drawing attention. Bitcoin is approaching a widely tracked golden cross, where the 50-day simple moving average, now at $64,217, is set to cross above the 200-day average at $68,975. The cryptocurrency is currently above both averages, but continued demand will be necessary for the rally to persist.

Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that cryptocurrencies carry high volatility and therefore risk, and should conduct their own research.

Bitcoin exchange-traded funds (ETFs) have attracted over $1 billion in new inflows this week, supporting a continued rally in the cryptocurrency that brought prices close to $73,000.

Major inflows lift Bitcoin and sentimentAccording to data from Farside Investors, investment in US-listed Bitcoin ETFs rose sharply, with more than $500 million flowing into products managed by BlackRock, Fidelity, and Grayscale on Wednesday alone. These companies are among the largest financial institutions managing spot Bitcoin products following regulatory approval of ETFs in early 2024.

BlackRock’s iShares Bitcoin Trust collected the largest portion of weekly inflows, receiving $588.5 million since Monday. Funds operated by companies like Morgan Stanley’s Bitcoin Trust also recorded substantial trading volumes over the same period.

ETF ProviderWeekly InflowsBlackRock (iShares Bitcoin Trust)$588.5 millionGrayscaleNot specifiedFidelityNot specifiedMorgan StanleyNot specifiedTotal (Top ETFs)Over $1 billionAs ETF inflows climbed, Bitcoin’s price surged, briefly reaching $72,659 on Thursday before retreating slightly to $72,606. This marked a 10% increase over the previous 24 hours. Bitcoin remains more than 40% below its record high of $126,080, recorded in October 2025.

Investor sentiment has shifted strongly in a positive direction. The Fear & Greed Index, a popular market sentiment measure, indicated that Bitcoin is now out of the “Fear” zone, moving into more bullish territory.

Policy backdrop and regulatory discussionsPresident Donald Trump met with cryptocurrency executives and regulatory officials at the White House on Wednesday, including Coinbase CEO Brian Armstrong and Securities and Exchange Commission Chair Paul Atkins. The discussion focused on the Clarity Act, a proposed bill that aims to provide clear legal guidelines for digital assets in the US.

Following the meeting, President Trump described the Clarity Act as a “very, very powerful” piece of legislation and urged Congress to move forward with its adoption.

President Trump called on lawmakers to pass the Clarity Act, citing its importance for clear crypto regulations.

The legislation, which seeks to define digital assets as securities, commodities, or payment stablecoins, passed in the House of Representatives last year. However, progress stalled this year, with a vote now expected in September.

Crypto companies have repeatedly emphasized the need for regulatory clarity to help drive innovation and compliance within the sector.

Mini dictionary: Clarity Act, a proposed US bill aimed at establishing a regulatory framework to clearly define categories for digital assets, such as securities, commodities, or payment stablecoins. The legislation seeks to address long-standing uncertainties for crypto businesses operating in the United States.

Broader financial driversSentiment in crypto markets also improved after the US Treasury Department announced plans to increase government debt repurchases. This move is expected to lower long-term Treasury yields, making non-yielding assets like Bitcoin and gold more attractive to investors.

As yields fell, both Bitcoin and gold rallied. The US dollar weakened in response to the Treasury’s announcement, further supporting risk-on investing in digital assets.

Lower yields have lifted both Bitcoin and gold, with investors turning to non-yielding assets as the dollar loses momentum.

Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that cryptocurrencies carry high volatility and therefore risk, and should conduct their own research.

Spot Bitcoin exchange-traded funds in the United States drew $517.19 million in net inflows on Wednesday, marking the strongest single-day surge since May 4. The increase came as Bitcoin’s price surpassed $69,000 for the first time in two months, underscoring a notable resurgence in institutional investor activity.

BlackRock’s IBIT dominates ETF inflowsBlackRock’s iShares Bitcoin Trust (IBIT) accounted for $284.7 million of the total inflow, maintaining a significant lead over competitors. ARK 21Shares’ ARKB followed with $77.7 million, while Fidelity’s FBTC captured $62.4 million during the same session. Eight out of twelve registered funds posted positive inflows, reflecting broad participation and renewed confidence in regulated crypto investment vehicles.

SoSoValue data indicated that this was the largest daily intake for U.S. spot Bitcoin funds in over three months, helping push their combined net assets to $84.31 billion. This total equals around 6.08% of Bitcoin’s overall market capitalization. Cumulative ETF inflows now stand at $52.79 billion, with IBIT alone responsible for more than half of Wednesday’s intake.

The distribution of inflows across multiple funds, rather than being concentrated in a single product, has been described by analysts as a positive signal of institutional demand within the sector. Recent analysis by VanEck revealed that the 30-day net inflow reached $663 million, recovering much of the $2.4 billion in outflows experienced the previous month. Wednesday’s allocation represented nearly 78% of that 30-day total, altering the prevailing narrative on demand for U.S. crypto ETFs.

Prior months had been characterized by withdrawals throughout May and June, with client flows turning more erratic through July and early August. The renewed inflows indicate that institutional investors are returning when liquidity improves. Rachael Lucas, representing BTC Markets, described the purchases as a move geared toward longer-term positioning by investors operating under formal compliance structures rather than short-lived retail speculation.

VanEck’s recent analysis pointed out that almost 78% of the prior 30-day ETF inflow was matched in a single day, signaling a swift change in institutional sentiment following a drawn-out period of withdrawals.

Treasury actions and regulatory shifts support risk appetiteThe ETF inflows coincided with a rally that accelerated after the U.S. Treasury announced it would double the cap on its long-end bond buybacks from $2 billion to at least $4 billion per operation. This program, targeting 10-to-30 year maturities, will run from September 9 through November 4, the end of the refunding quarter. The Treasury cited robust market offers as a reason for the increase and intends to review sizing after November.

Bond yields declined on the announcement, the dollar weakened, and risk assets rallied. Jeff Mei of BTSE suggested that the Treasury’s policy shift sparked renewed risk appetite, fueling both ETF inflows and the cryptocurrency’s price strength.

On the regulatory front, the U.S. Securities and Exchange Commission unveiled proposals introducing new exemptions for crypto investment contracts. The updates would allow offerings up to $5 million over four years or up to $75 million per year, accompanied by additional disclosure requirements. Market analysts noted that these measures may further support institutional participation.

Technical and structural shifts shape Bitcoin’s outlookTechnically, Bitcoin’s price reached $69,892 before trading around $69,514, near its 200-day trend zone and at the midpoint of its broader $60,000 to $80,000 range. Analyst Daan Crypto Trades observed that Bitcoin generated a new higher high while testing its critical 200-day moving average and exponential moving average. This region remains closely watched for signs of whether upward momentum could carry BTC past $70,000 in the coming sessions.

Daan Crypto Trades explained that Bitcoin’s trend remains upward after retracing much of June’s sharp decline, but the asset is now positioned in the center of its established range, and several key technical levels remain in play.

Expectations are for continued volatility as the market navigates ongoing resistance. Sustained closes above the moving average area would offer a stronger technical signal for further gains.

Against this backdrop, a significant transformation is underway as Wall Street increasingly shifts toward Web3. Investors have begun using platforms such as 1stepSwap to directly hold tokenized shares of leading U.S. companies, as well as gold and silver, in their crypto wallets. By tokenizing real-world assets and automatically searching for the best available prices, these platforms eliminate intermediaries and enable near-instant execution.

The combination of ETF inflows, government policy actions, regulatory adaptation, and technological innovation is shaping a new landscape for crypto and traditional asset markets alike.

Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that cryptocurrencies carry high volatility and therefore risk, and should conduct their own research.

In brief Nasdaq-listed Zhibao Technology closed a $154.7 million PIPE financing paid for with 2,380 Bitcoin contributed straight to a company wallet. Director Botao Ma called the deal one of the most transformational moments in the firm's decade-long history. The all-crypto funding structure sets Zhibao apart from the usual cash-raise-then-buy treasury model; it joins a crowded field—including Metaplanet's U.S. treasury push and Strategy—even as cracks in DATs show. Zhibao Technology, a Nasdaq-listed Chinese insurance-technology company, has stepped into the corporate Bitcoin treasury arena, closing a $154.7 million private placement funded entirely in cryptocurrency.

The Shanghai-based firm said Monday that a syndicate of non-U.S. investors paid for the raise by contributing 2,380 Bitcoin directly to a company wallet, rather than cash. The coins were valued at a reference price of $65,000 each, pegged to market levels as of July 30.

Myriad: Bitcoin next price move? Click to make your prediction.In exchange, the investors received 442 million units priced at $0.35 apiece, each pairing a Class A ordinary share with a two-year warrant. Roughly 396 million units were delivered at closing, with the remainder to follow shareholder approval.

Zhibao, which bills itself as a pioneer of embedded digital insurance in China, framed the deal as a turning point rather than a departure from its core business. Director Botao Ma called the financing one of the most transformational moments in the company's decade-long history, saying it strengthens Zhibao's financial base and positions it to expand its AI-driven insurance products. He added that the investors bring deep expertise in crypto markets and infrastructure, which he expects to open new opportunities for the firm.

The move adds Zhibao to a swelling roster of public companies parking Bitcoin on their balance sheets, though its all-crypto funding structure stands out from the cash-raise-then-buy model most treasury firms use.

Japan's Metaplanet is seeding a U.S. treasury vehicle with 2,100 BTC, worth roughly $132 million. Meanwhile, Strategy, the pioneer of the playbook, has halted its weekly Bitcoin buys and has instead begun to sell batches of its holdings in an attempt to right its financial ship. The company recently raised $334 million by selling stock without touching its Bitcoin holdings.

The digital asset treasury strategy carries real risks alongside its upside. Treasury firms tie their fortunes to a volatile asset, and cracks have begun to show across the sector. Strategy has shifted to what it calls a capital-management framework and is using its Bitcoin sales to fund dividends and buybacks, while some newer entrants have started unwinding their positions entirely as the trade cools.

Zhibao said it will file a resale registration statement with the SEC within 45 days of the July 31 effective date, covering the shares and warrants issued in the deal.

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A Singapore court has frozen about S$75 million ($58 million) in Bitcoin and USD Coin after a major crypto trading platform alleged that an internal ledger error caused it to mistakenly credit thousands of BTC and Bitcoin Cash to a long-standing customer.

Summary

Singapore’s SICC froze about S$75 million in Bitcoin and USDC linked to a dispute between a major crypto platform and a long-time customer. The platform said an internal ledger error led it to mistakenly transfer 2,500 BTC and 2,500 BCH to the customer’s wallets in July 2024. The customer later moved 780 BTC off the platform and converted another 20 BTC into about 816,773 USDC. The court also ordered the customer to disclose the location of the disputed assets and their proceeds. The platform recovered the remaining 1,700 BTC and 2,500 BCH after discovering the alleged error in January 2025. The Singapore International Commercial Court said the interim proprietary injunction prevents the customer from disposing of, dealing with or reducing the value of about 780 BTC and 816,773 USDC, along with assets, profits or interest derived from them. The order was granted on March 26 after a hearing before Singapore High Court Justice Aidan Xu and SICC International Judges Anthony Meagher and David Goddard.

The dispute involves an anonymised group of companies that operates what the court described as one of the world’s largest digital asset trading platforms and a customer who had used the platform since around 2013. Court documents identified the parties only as DVA, DVB and DVC while an application for confidentiality orders remains pending.

Along with freezing the crypto, the court ordered the defendant to disclose where the disputed assets and their proceeds were being held. The judges declined, however, to give the platform group advance permission to use that disclosure to seek similar injunctions in other jurisdictions, leaving it free to apply for permission later if required.

Singapore court dispute traces back to unsupported wallets At the centre of the case are two specialised wallets that once contained 2,500 BTC and 2,500 Bitcoin Cash. According to the judgment, the wallets were designed as a self-custody product that required security credentials, including a user key held solely by the customer.

Support for the wallet product ended in April 2018, although customers could continue accessing the wallets for a period through an unsupported open-source tool. In March 2020, the entire 2,500 BTC and 2,500 BCH balance was transferred away from the specialised wallets, leaving them effectively empty.

The platform group alleged that a technical problem prevented those withdrawals from being recorded correctly on its internal ledgers. Because the ledger continued to show the assets as remaining in the specialised wallets, the companies operated for several years on the assumption that the customer was still entitled to the balances.

A relationship manager later tried to help the customer recover what the platform believed were assets trapped in the discontinued wallet product. Acting on its ledger records, the platform transferred another 2,500 BTC and 2,500 BCH into other accounts belonging to the customer in July 2024.

The claimants say those digital assets came from their own holdings inside the platform group’s omnibus wallets and were transferred solely because of the mistaken balance shown on the internal system. The customer disputes that account and has maintained that the assets transferred to him were rightfully his.

Mistaken crypto transfers have previously resulted in lengthy recovery disputes. In 2022, crypto.news reported on a Crypto.com transfer error in which the exchange mistakenly sent an Australian customer about $10.5 million instead of a $100 refund and discovered the error months later during an audit.

Customer moved 780 BTC and converted another 20 BTC to USDC After receiving the July 2024 transfers, the defendant began moving part of the crypto away from the platform.

Court records show that on July 13, 2024, the customer converted 20 BTC into about 816,773 USDC and transferred the stablecoins to an unhosted wallet. Five withdrawals between July 17 and Nov. 10 moved another 380 BTC to a separate unhosted address.

A further 200 BTC was transferred on Nov. 24, followed by another 200 BTC on Jan. 7, 2025, bringing the amount sent to a third external wallet to 400 BTC. Some 150 BTC from that wallet was later transferred elsewhere in February 2026, according to evidence submitted by the claimants.

The companies also told the court that subsequent transactions involving the 380 BTC and 816,773 USDC made their current locations difficult to determine. The defendant did not dispute making the transactions but maintained that he had been dealing with crypto that belonged to him.

By the time the platform acted, 1,700 BTC and the full 2,500 BCH transferred in July 2024 remained in the customer’s accounts. The companies froze those wallets on Jan. 29, 2025, and re-credited the remaining assets to themselves in an attempt to reverse part of the earlier transfer.

The platform group subsequently sought the return of the 780 BTC and 816,773 USDC that had already left its system, but the customer refused. The companies valued the assets at roughly S$75 million at the time of the injunction hearing.

Platform alleges unjust enrichment and constructive trust Proceedings were initially filed in the General Division of Singapore’s High Court in November 2025 before being transferred by consent to the SICC.

The claimants’ 62-page statement of claim contains four causes of action, including unjust enrichment, a proprietary claim, deceit or negligent misrepresentation, and an alleged breach of the contractual provisions governing the platform’s services. They are also seeking a declaration that the defendant holds the disputed assets on constructive trust for one of the claimant companies and must return them.

According to the claimants, the July 2024 transfers resulted from their incorrect understanding of the old wallet balances, while the customer allegedly knew about the mistake and took advantage of it.

The defendant has rejected that version of events. He told the court that he did not remember making the March 2020 transfers, although he accepted that blockchain records show the transfers occurred, and argued that the platform’s own admission of faulty internal ledger records weakened its claim that the assets transferred in 2024 belonged to the companies.

He also argued that the transferred crypto could have represented his own assets held elsewhere on the platform or assets belonging to other customers. Having maintained extensive crypto holdings and activity, the defendant said he relied on the platform to keep track of what he held and believed that the July 2024 assets belonged to him.

The customer has counterclaimed for the assets that remain frozen on the platform or compensation of equivalent value, while denying that he knew the companies had made any mistake.

Singapore courts have dealt with several high-value crypto disputes involving exchange operators over the past year. Earlier in August, Binance and RedotPay gave conflicting accounts over the status of a separate Singapore proceeding tied to claims worth nearly $473 million.

Singapore’s courts have also played a role in handling distressed crypto businesses, including proceedings involving WazirX’s Singapore-based parent Zettai, whose restructuring proposal returned to court after receiving 95.7% creditor support in August 2025.

Judges find serious ownership question to be tried For the interim stage of the case, the three-judge panel found enough evidence to establish a serious question over whether the platform companies retained a proprietary interest in some or all of the disputed assets.

The court said it was arguable that the specialised wallet balances were effectively zero before the July 2024 credits and that the platform transferred 2,500 BTC and 2,500 BCH because its internal records incorrectly showed the earlier holdings as still present.

Judges also found an arguable case that the customer knew about the platform’s mistake either when the transfers were made or, at the latest, after the platform discovered the issue and contacted him in 2025. Under that scenario, the court said an argument could be made that identifiable assets and traceable proceeds were held on constructive trust for the claimants.

On whether an injunction was necessary, the court considered the risk that the companies could win at trial but still be unable to recover the crypto if the assets were moved or dissipated.

The judges noted evidence that the defendant had used part of the disputed assets as security for a loan to cover legal costs and had not provided updated evidence about his financial position or current asset holdings. The court found sufficient doubt over his ability to satisfy a substantial judgment if the companies eventually succeeded.

At the same time, the platform group gave the court an undertaking to compensate the customer for losses caused by the injunction if it later turns out that the order should not have been granted.

The disclosure order requires the defendant to identify the whereabouts of assets covered by the injunction, including relevant crypto controlled through third parties acting under his direct or indirect instructions. The SICC left both sides free to return to court, including if the claimants later seek permission to use the disclosed information in civil proceedings outside Singapore.

Bitcoin's muted response to softer rate-hike expectations has raised questions about its near-term demand.

Bitcoin is struggling to hold its June range floor after $390 million left US spot BTC ETFs last week, according to Wintermute’s newest market update.

The trading firm says falling rate-hike odds have failed to lift BTC, while ETF redemptions and miner selling have left the market without a strong source of fresh demand.

ETF Flows Fail to Sustain Bitcoin’s August Recovery As Wintermute pointed out, July CPI came in at 0.1% month-on-month, cutting September rate-hike odds from roughly even to about one-in-three, with retail sales also posting their steepest decline since May 2025.

Almost nothing rallied on it: the S&P 500 added just 0.40%, long-dated Treasuries fell 0.87%, and BTC sat at the bottom, down 3.12%. CoinGecko data shows the cryptocurrency is currently around $64,000, up 1.2% over 24 hours. However, it is down nearly 1% over 30 days and 49% below its October 2025 all-time high.

Brent crude jumped 7.91% as Hormuz ship transits collapsed from 31 the prior weekend to five Saturday and zero Sunday, with the 60-day ceasefire expiring and talks stalled. A re-escalation that holds Brent near $89 puts the August CPI print at risk.

For Wintermute, that combination matters. Lower rate-hike expectations would normally improve the case for risk assets, but Bitcoin failed to respond. The firm said the market was moving toward a situation where “the inflation problem seems to be moving from the Fed’s hands to oil’s.”

The ETF picture was also weak. Roughly $390 million left US spot Bitcoin ETFs between August 10 and 14, the largest weekly redemption since early July. As CryptoPotato reported, Bitcoin ETFs recorded only one positive session last week, with Monday seeing $145 million leave the funds, followed by $61 million on Wednesday, $131 million on Thursday, and nearly $58 million on Friday. Tuesday brought just under $5 million of net inflows.

You may also like: Tech Futures Drop on Rising Treasury Yields While Bitcoin Holds Near $64K How Will BTC React as US and Iran Reportedly Extend Ceasefire? Solana Overtakes Bitcoin and Ether in GSR’s Latest Crypto Portfolio Shake-Up “An asset that cannot rally on good news while its dedicated vehicles bleed is telling us the marginal seller is back, which weakens the depletion argument we have been carrying since W31,” wrote the trading company.

Miner Selling Adds Another Problem Wintermute also pointed to Riot Platforms as evidence that miners may remain a source of Bitcoin supply. The firm sold 4,300 BTC during the second quarter after selling 3,778 BTC in the first quarter. Its treasury fell to 11,380 BTC as mining costs approached $91,000 per unit. Bitcoin was trading below $64,000, contributing to Riot’s $237 million quarterly loss.

Riot is also shifting part of its business toward AI data centers, with the miner reportedly agreeing to supply 191 megawatts of capacity to Anthropic under a 20-year contract worth $9.1 billion.

The ETF picture is not uniformly negative, though, as Jane Street disclosed more than $1 billion in US spot Bitcoin ETF holdings as of the second quarter, including about $828 million in IBIT. However, the filing only shows quarter-end holdings and does not capture the firm’s full derivatives exposure.

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BlackRock said in an August 2026 research report that Bitcoin’s decline of more than 50% from its October 2025 record did not change the asset manager’s long term investment case.

Summary

Bitcoin fell more than 50% from October 2025’s record before reaching June lows below $60,000. Futures open interest exceeded $90 billion, with offshore perpetual contracts representing approximately 80% at peak. Spot Bitcoin ETPs lost roughly $5 billion after attracting $60 billion through October 2025 previously. Strategy sold 1,690 BTC in August, using $108.6 million to repurchase preferred shares during weakness. BlackRock’s historical analysis found 1% to 2% allocations improved hypothetical portfolio risk adjusted returns historically. The firm attributed the correction to excessive leverage, weaker institutional flows and slower purchasing by digital asset treasury companies. Its paper described the decline as a positioning and liquidity event rather than evidence that Bitcoin’s monetary or diversification properties had structurally changed.

BlackRock’s view is an investment assessment, not a prediction that prices will recover. The firm also manages the iShares Bitcoin Trust ETF and warned that Bitcoin remains volatile, speculative and capable of causing a total loss.

Bitcoin’s $90 billion leverage buildup amplified losses Bitcoin climbed from $15,765 in late 2022 to a record $124,606 in October 2025, according to BlackRock’s Bloomberg and Coin Metrics data. Futures open interest exceeded $90 billion near the peak.

Approximately 80% of that exposure came from perpetual futures outside CME. Some platforms offered leverage of between 50 and 125 times, leaving traders vulnerable to automatic liquidation following relatively small adverse price moves.

BlackRock says Bitcoin’s core investment case remains unchanged after a 50%+ drawdown from its October 2025 highs.

The world’s largest asset manager views the sell-off as the result of crypto-native deleveraging and shifting flows, not a change in the long-term thesis.

At the… pic.twitter.com/z4ratfqFkD

— The Wolf Of All Streets (@scottmelker) August 18, 2026 The first major unwind followed U.S. tariff announcements involving China on Oct. 10, 2025. Bitcoin fell 6%, while open interest declined by $20 billion in one day. BlackRock described this as the largest daily open interest reduction in the data reviewed.

Further liquidation waves followed in February and June 2026, eventually pushing Bitcoin below $60,000. The sequence supported BlackRock’s argument that leverage accelerated the decline, although it does not prove that positioning was the only cause.

The U.S. derivatives market has also changed since the selloff. The CFTC approved KalshiEX’s onshore Bitcoin perpetual contract in May, finding that its structure complied with federal derivatives rules. The order brought a product long associated with offshore exchanges into a regulated U.S. market.

ETP outflows and AI funds competed for capital Spot Bitcoin ETPs attracted approximately $60 billion between their January 2024 U.S. launch and October 2025, BlackRock found. The products then recorded roughly $5 billion in aggregate outflows through July 2026.

Over the later period, AI themed funds attracted more than $46 billion. BlackRock said the rotation “likely competed for capital” and became a drag on Bitcoin allocations. The wording reflects the firm’s interpretation because fund flow data alone cannot establish why every investor moved money.

The rotation was also visible in retail and institutional attention. As previously reported, both Bitcoin fund withdrawals and declining crypto search interest coincided with stronger interest in AI equities.

Recent U.S. fund data has been more constructive but remains uneven. Farside data showed $297.5 million of net inflows on Aug. 17 and $189.3 million on Aug. 18. The combined $486.8 million followed approximately $385.2 million of withdrawals during the previous week.

Treasury sales added supply during the correction BlackRock also identified sales by miners, large holders and digital asset treasury companies as sources of pressure. MARA sold 15,133 BTC for approximately $1.1 billion during March, according to its regulatory filing.

Strategy later adopted a Bitcoin monetization program allowing sales to fund reserves, dividends, interest payments and security repurchases. The program does not require the company to sell and has no fixed expiration date.

An Aug. 10 SEC filing confirmed that Strategy sold 1,690 BTC for $108.6 million between Aug. 3 and Aug. 9. It used the proceeds to repurchase STRC preferred shares.

The transaction provided a verified update to BlackRock’s discussion of treasury related selling. In related coverage, crypto.news examined how corporate treasury selling pressure has increasingly interacted with U.S. spot fund demand.

BlackRock retains its small allocation argument BlackRock’s ten year historical test found that adding a 1% or 2% Bitcoin allocation to a traditional U.S. 60/40 portfolio improved hypothetical risk adjusted returns. A 1% allocation produced a Sharpe ratio of 0.90, compared with 0.81 for the benchmark. A 2% allocation produced a ratio of 0.96.

Maximum drawdowns were similar across the tests. The traditional portfolio recorded a 20.3% decline, compared with 20.6% for the 1% allocation and 20.9% for the 2% allocation.

Source: BlackRock These results were hypothetical and benefited from hindsight. They did not include an actual BlackRock client portfolio and cannot establish how the allocations will perform in the future. Diversification also cannot prevent market losses.

BlackRock nevertheless said Bitcoin’s investment case “remains unchanged,” citing its capped supply, ten year correlation of 0.18 with the S&P 500 and possible use as a hedge against declining fiat purchasing power.

Bitcoin traded near $64,300 on Aug. 19 after reclaiming $64,000. As crypto.news reported, the latest price recovery coincided with renewed ETP inflows, although increasing leverage left the move exposed to another reversal.

The next evidence will come from ETP flows, futures positioning and corporate disclosures. Sustained inflows and lower speculative leverage would support BlackRock’s cyclical correction argument. Renewed liquidations or continued treasury sales would keep pressure on that assessment.

Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.

PANews reported on August 19 that, according to SoSoValue data, yesterday (U.S. Eastern Time, August 18), Bitcoin spot ETFs had total net inflows of $189 million.

The Bitcoin spot ETF with the largest single-day net inflow yesterday was BlackRock’s ETF IBIT, with a single-day net inflow of $144 million. IBIT’s historical total net inflows have now reached $61.4 billion.

It was followed by Fidelity’s ETF FBTC, with a single-day net inflow of $23.92 million. FBTC’s historical total net inflows have now reached $10.02 billion.

The Bitcoin spot ETF with the largest single-day net outflow yesterday was VanEck ETF HODL, with a single-day net outflow of $16.92 million. HODL’s historical total net inflows have now reached $1.07 billion.

In addition, Hashdex’s Bitcoin spot ETF DEFI has initiated closure and liquidation procedures due to factors such as asset size, trading liquidity, and operating costs. It ended trading on NYSE Arca on August 17 and will subsequently delist. The fund began liquidating its remaining Bitcoin holdings on August 18 and is expected to pay cash liquidation proceeds to holders around August 24. Bloomberg data show that as of July 30, DEFI’s assets under management were approximately $7.28 million.

As of press time, the total net asset value of Bitcoin spot ETFs was $79.3 billion, the ETF net asset ratio (market value as a percentage of Bitcoin’s total market value) reached 6.12%, and cumulative historical net inflows have reached $52.28 billion.

Citigroup (NYSE:C) plans to launch Bitcoin (CRYPTO: BTC) custody for institutional clients later this year, letting them hold crypto and traditional assets through the same framework.

What Citi Is Actually LaunchingAccording to a Citi press release Tuesday, Bitcoin custody forms part of Custody+, a new suite of real-time custody solutions the bank launched alongside completing its US rollout of Single Event Processing technology. 

The platform now processes over 80% of Citi’s asset-servicing volume in real time, cutting processing times for voluntary corporate actions by up to 92%.

The core pitch to institutional clients is simplicity. Traditional securities and crypto custody sit within the same integrated framework, so clients do not need separate infrastructure for each. 

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Citi Token Services already moves tokenized deposits near-instantly on a 24/7 basis across select markets, and Bitcoin custody extends that same foundation into digital assets.

“Custody+ is the product of a multi-year commitment to building infrastructure that matches the speed of our clients’ strategies,” Citi Head of Custody Amit Agarwal noted in the release.

What Else Custody+ CoversBeyond Bitcoin custody, the platform packages several capabilities under one roof:

Real-time asset servicing — 96% of US voluntary events now processed in under two hours Instant settlements — end-to-end from instruction to final settlement at Central Securities Depositories Real-time cash and liquidity — instant position updates and liquidity sweeping Accelerated tax — AI-reduced documentation processing times by up to 70% On-demand FX — real-time execution with automated hedging Why Does This Matter for Crypto Right Now?According to Decrypt, the announcement builds on plans Citi revealed in October to launch institutional Bitcoin custody in 2026. 

It arrives as Wall Street’s push into digital assets accelerates across the board. In January the New York Stock Exchange announced it was working with Citi and Bank of New York Mellon Corp (NYSE:BNY) on a blockchain-based platform supporting tokenized stocks and ETFs. 

In February Morgan Stanley (NYSE:MS) applied for a national trust bank charter specifically for crypto custody.

Citi’s Investor Services business supports clients across more than 100 markets worldwide, including 62 proprietary markets, and invests over $2 billion annually in its platform strategy.

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After years of enforcement actions, lawsuits, and the regulatory equivalent of “I’ll know it when I see it,” the SEC and CFTC have finally put pen to paper on what counts as a security in crypto and what doesn’t. The answer, released March 17, 2026, is surprisingly clean: Bitcoin, Ether, Solana, XRP, and Cardano are digital commodities. Payment stablecoins issued under the GENIUS Act of 2025 are not securities. And the whole framework goes into effect on March 23, 2026.

The joint interpretive release establishes a five-category taxonomy for crypto assets under federal securities laws. It’s the most comprehensive attempt by US regulators to draw clear lines around which digital assets fall under the SEC’s jurisdiction and which belong to the CFTC, or to neither.

What the taxonomy actually says The five categories sort the entire crypto landscape into distinct regulatory buckets. At one end, assets like BTC, ETH, SOL, XRP, and ADA are designated as “digital commodities,” meaning they are explicitly not securities. At the other end, tokenized versions of traditional financial instruments, think on-chain stocks or bonds, are definitively classified as securities, subject to full SEC oversight.

Payment stablecoins get their own carve-out. Tokens issued by entities that comply with the GENIUS Act of 2025, the stablecoin legislation signed into law last year, are excluded from the definition of a security by statute. That’s not an interpretive stretch or a no-action letter. It’s a statutory exclusion.

One of the more nuanced aspects of the framework involves how investment contracts interact with otherwise non-security assets. The guidance acknowledges that a digital commodity can be offered as part of an investment contract during, say, a fundraising round or token sale. But that status isn’t permanent. Once the issuer’s obligations are fulfilled, the asset can shed its investment contract classification entirely.

Why this matters now SEC Chairman Paul S. Atkins framed the release as the agency finally providing “clear regulations” for the industry. CFTC Chairman Michael S. Selig emphasized that harmonizing the two agencies’ approaches was essential for the sector’s growth.

For context, the previous SEC regime under Gary Gensler operated on the premise that nearly every crypto token, aside from Bitcoin, was likely a security. That philosophy fueled enforcement actions against exchanges, token issuers, and DeFi protocols alike. Ripple’s XRP spent years in legal limbo. Solana’s status was debated endlessly. Ether occupied a bizarre gray zone where even SEC officials contradicted each other on its classification.

The new taxonomy resolves all of those questions simultaneously. XRP is a commodity. SOL is a commodity. ETH is a commodity.

For stablecoins, the GENIUS Act already created a licensing framework for stablecoin issuers. Compliant stablecoins are now definitively outside the SEC’s reach by statute.

Market and industry implications For DeFi protocols and token projects, the investment contract provision is particularly relevant. The idea that a token can start life as part of a securities offering but “graduate” to commodity status once issuer obligations are met gives projects a roadmap. It acknowledges the reality that many tokens are sold to fund development but eventually function as utility or governance tools within decentralized networks.

The framework also draws a firm line around tokenized securities. Any project that puts traditional financial assets on-chain, whether it’s tokenized Treasury bills, equity, or corporate bonds, falls squarely under SEC jurisdiction.

Whether this framework survives a future change in administration or congressional priorities remains an open question. Interpretive releases carry less legal weight than formal rulemaking, and a differently composed SEC could theoretically revisit these classifications. But with the CFTC co-signing the guidance and the GENIUS Act providing statutory backing for the stablecoin provisions, unwinding this framework would require considerably more effort than issuing a new staff bulletin.

Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.

Fintech

18 August 2026 | 17:33 Cash App is opening a new route into crypto for eligible U.S. customers. They will be able to use their Cash App balance to buy assets offered by MoonPay, including ether, solana, XRP and USDT.

Key Takeaways Cash App balances can fund MoonPay crypto purchases. Eligible users gain access beyond Bitcoin and USDC. MoonPay, not Cash App, handles the purchase flow. Wallet choice and network accuracy become the user’s responsibility. MoonPay’s eligibility, pricing and asset rules apply. Cash App is expanding access without adding a new token catalogue Cash App has long been associated with Bitcoin, and its recent USDC feature gave eligible customers a way to move digital dollars across supported networks. The MoonPay arrangement broadens the range of assets a Cash App customer can buy without requiring Block to build native support for each new token, chain and wallet.

The distinction matters. A customer is not buying ether or solana through a new Cash App trading screen. They are using their Cash App balance to pay for a MoonPay transaction.

MoonPay’s official purchase page lists more than 100 supported cryptocurrencies, including Bitcoin, ether, solana, XRP, USDT and USDC. The final selection available to an individual customer can still vary by jurisdiction, payment method and wallet compatibility.

MoonPay also requires users to complete its own onboarding and identity checks. The service asks the buyer to choose an asset, provide a wallet address and review the purchase before paying. Cash App may supply the funds, but it does not replace MoonPay’s compliance process or transaction rules.

The purchase path changes after the Cash App balance is used Cash App and MoonPay are handling different parts of the same customer journey. Cash App provides a familiar source of dollars. MoonPay is the on-ramp that converts those dollars into crypto and delivers it to a wallet.

Crypto Service Comparison A modern architectural look at native rails versus integrated gateway flows.

In-house ecosystem routing for primary assets.

Assets Involved

Bitcoin and USDC services

Order Location

Inside Cash App interface

Wallet Requirements

Cash App’s supported Bitcoin/USDC rails

Pricing & Terms

Cash App ecosystem rates

Destination Routes

Cash App transfer routes

CA FUNDED

External gateway checkouts powered by app balances.

Assets Involved

MoonPay’s eligible asset catalogue

Order Location

In MoonPay’s dedicated purchase flow

Wallet Requirements

MoonPay & target network rules

Pricing & Terms

MoonPay at final checkout

Destination Routes

Compatible external wallet choice

Decentralized peer-to-peer alternative routing.

Assets Involved

Full token ecosystem access

Order Location

DEX / Protocol interface

Wallet Requirements

Self-custody web3 standards

Pricing & Terms

Destination Routes

Direct-to-address transfer

That design gives Cash App a fast way to offer more choice while keeping its own crypto product focused. It also means that a customer who starts with a Cash App balance quickly enters a different environment, with different support, pricing and custody considerations.

The cleanest way to understand the partnership is as a bridge. Cash App supplies the funding rail; MoonPay provides access to the wider crypto market.

USDC inside Cash App is still a different product Cash App’s USDC service should not be confused with a MoonPay purchase.

Under Cash App’s official USDC rollout, eligible users can send and receive USDC on Solana, Ethereum, Polygon and Arbitrum. But the app automatically converts incoming USDC into U.S. dollars, leaving the customer with a unified dollar balance rather than a standalone USDC balance to manage.

Cash App handles the sourcing, conversion and settlement behind the scenes. That makes USDC a payment feature inside the app, not a broader self-custody crypto experience.

MoonPay takes the customer in the other direction. Instead of converting crypto back into a Cash App dollar balance, it lets the buyer choose a crypto asset and send it to a compatible wallet. That can be useful for people who want to hold assets outside Cash App or use them across other crypto services. It also makes the wallet destination a far more important decision.

More assets mean more room for mistakes Buying Bitcoin or receiving USDC through a familiar app can feel straightforward. Moving into a wider set of tokens and networks is less forgiving.

A user needs to confirm the asset, blockchain network and receiving address before placing the order. An ERC-20 token sent to an incompatible address, or a transfer made on the wrong network, may not be recoverable. Cash App itself warns customers that sending USDC to an unsupported asset or incompatible network can result in a permanent loss.

The same basic rule applies here: a payment balance may be familiar, but the transaction is still an onchain crypto purchase. Once the order is completed and the asset is sent to an external wallet, Cash App cannot reverse it simply because the user selected the wrong network or address.

MoonPay’s purchase guide says it works with non-custodial wallets and can help users obtain one at checkout if they do not already have one. That gives buyers more freedom over where their crypto sits. It also means the buyer, rather than Cash App, is responsible for securing wallet access and recovery information.

The final price will be set at MoonPay checkout The funding source may be Cash App, but the crypto order is still priced by MoonPay. Users should not assume that Cash App’s fee structure for Bitcoin or USDC applies to a MoonPay purchase.

MoonPay lists general fees ranging from as low as 1% for certain bank-transfer purchases to as much as 4.5% for some Visa-card transactions. Those figures are useful context, not a promised rate for the Cash App option.

The available materials do not set out one universal Cash App balance fee. The relevant price is the quote shown by MoonPay before the customer confirms the transaction, including any spread, network cost or payment-related charge.

That is where the convenience of the partnership needs to be judged. Cash App removes one step from funding a crypto purchase. It does not make the underlying asset cheaper, safer or easier to sell later.

MoonPay is trying to sit behind more ways people move money The Cash App deal fits MoonPay’s broader strategy of becoming infrastructure rather than relying only on its own consumer app. It can sit behind a wallet, a checkout page or another financial product while handling the conversion between conventional money and crypto.

MoonPay has recently taken that idea into AI tools as well. Its PayBox product lets ChatGPT and Claude initiate crypto transactions and other payments within limits chosen by the user. The product uses passkeys, permission scopes and spending caps to keep the assistant from receiving unrestricted payment authority.

The Cash App partnership follows the same logic from another direction. MoonPay does not need to own the customer’s main financial app if it can become the layer that turns that app’s balance into an onchain purchase.

Cash App has widened the door, not rebuilt the house For users, the new option makes it easier to move from a Cash App balance into assets that were previously outside the app’s native crypto offering. For Cash App, it is a way to answer demand for more choice without becoming the direct provider of every token and wallet service.

The limits of the arrangement are just as important as the expansion. Cash App remains centred on its own Bitcoin and USDC services. MoonPay handles the wider asset list, the checkout process and the delivery of crypto to an external wallet.

That gives customers more ways in. It also makes it essential to understand where Cash App’s role ends and MoonPay’s begins before pressing “buy.”

Author

Kosta has reported on cryptocurrency markets and blockchain infrastructure since 2020, bringing over six years of hands-on experience in the crypto industry built through daily tracking of markets, trends, and emerging blockchain developments. Specializing in Bitcoin on-chain analysis, institutional ETF flows, and digital asset price action, his work at Coindoo has been cited by other news agencies and consistently covers market developments with a focus on data-driven reporting across Bitcoin, Ethereum, Solana, and XRP. Over the years, Kosta has contributed to multiple crypto media outlets in different regions, authoring over 6,000 articles across the sector. His reporting spans cryptocurrency markets and the broader fintech industry, tracking not only price action but also the technological and regulatory forces shaping the ecosystem. To support his analysis, Kosta actively leverages on-chain data and metrics from leading platforms such as Santiment, Glassnode, and CryptoQuant, enabling deeper, evidence-based market insights. He believes in the power of transparency and the data that underpins the blockchain ecosystem. His academic background in Marketing Management from Denmark further complements his analytical approach, adding a strong understanding of communication strategy and content positioning to his work.

11h05 ▪ 6 min read ▪ by Luc Jose A.

Summarize this article with:

Bitcoin has just shattered a widely anticipated scenario: that of a progressive shortage of BTC on exchanges. In just three weeks, the reserves available on centralized platforms have strongly rebounded, despite ETF demand. This turnaround reveals a reality more complex than a simple “supply shock” fueled by institutional investors. Where do these new bitcoins come from and what does this return of liquidity reveal about market balance? On-chain data and ETF flows provide several answers.

In Brief 28,000 BTC have returned to exchange platforms in less than three weeks. This return of liquidity cancels out 84% of the supply drain accumulated over a month and a half. ETFs mostly source their supplies off-book via OTC markets. The reserve reinjection dissipates the theoretical risk of an immediate Bitcoin shortage. A Rapid Reversal of On-Chain Crypto Reserves On-chain analysis data published on August 17 by the firm Santiment Intelligence reveal a remarkably rapid change of direction regarding the amount of bitcoins deposited on exchange platforms. While exchange reserves had hit a low point on July 28 at around 1.304 million BTC, concluding six weeks of continuous withdrawal that had cut platforms by 33,000 coins since the peak on June 12 set at 1.337 million, the trend completely reversed.

By August 16, balances raised their level to reach again nearly 1.332 million tokens. This return of 28,000 BTC on centralized platforms essentially erases 84% of the contraction suffered over the previous month and a half. As summarized Santiment in a publication describing the complete tracking of this metric: “balances hit a low on July 28 before rising to approximately 1.332 million BTC by August 16. This return of nearly 28,000 BTC thus erases about 84% of the observed decline”.

This acceleration of deposited liquidity fundamentally changes the reading framework of short-term scarcity. The portfolio reloading process assigned to market operators occurred at a pace twice as fast as the prior drying phase. The gap from the reserve peak recorded in mid-June has now narrowed to only 5,200 bitcoins.

This dynamic highlights how quickly investors can bring back tokens to liquid order books once market conditions change. Santiment emphasized the brevity of this cycle by synthesizing the movement with this formula: “it took six weeks for the supply pressure to build, and it dissipated in less than three”.

To better understand the exact chronology of this market movement, three key steps summarize the dynamics observed on reserves :

From June 12 to July 28 : a prolonged fall of exchange reserves from 1.337 million to 1.304 million BTC, removing 33,000 coins from the market ; From July 28 to August 16 : a spectacular rebound bringing balances back to 1.332 million BTC thanks to the rapid deposit of 28,000 tokens ; As of August 16 : the erasure of 84% of the initial drainage, leaving only 5,200 BTC difference with the June peak. The Mechanism of OTC Desks and the Volatility of Institutional Flows This rapid swelling of exchange reserves does not necessarily contradict the institutional accumulation dynamic via financial vehicles but sheds light on its real mechanism. The regulation defined by the SEC allows authorized managers to create shares in kind or via cash, enabling them to source from over-the-counter (OTC) desks or directly from large holders outside public markets.

Consequently, strong demand on ETFs does not require an immediate purchase on the spot exchange order books. This structure explains why deposits on centralized exchange platforms, which reflect addresses assigned to spot exchanges, can increase independently of the net volume absorbed by listed funds.

The recent volatility of subscriptions to US ETFs illustrates this heterogeneity of institutional behaviors. During the first full week of August, spot ETFs recorded a sequence of five consecutive days of positive flows, totaling $853.54 million of net inflows. BlackRock’s IBIT fund alone captured $693.5 million over this period, achieving its best weekly performance since April.

However, this momentum faded starting August 10. On August 12, the market recorded a net total outflow of $61.16 million, mainly pulled down by disengagements from Fidelity and BlackRock products, reflecting discontinuous institutional demand.

A Strategic Reallocation of Bitcoins With Still Uncertain Consequences This massive reload of exchange order books dissipates in the short term the theoretical risk of an imminent supply shock and reintroduces sufficient market depth to absorb future volatility spikes.

While the presence of 28,000 additional tokens on the platforms offers respite to buyers seeking immediate liquidity, it also reminds observers that Bitcoin scarcity cannot be evaluated solely through the prism of ETF flows.

Market players will now have to monitor whether this reserve return signals profit-taking by some long-term investors or if it represents a new segmentation of custody between private wallets, OTC desks, and public platforms.

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Luc Jose A.

Diplômé de Sciences Po Toulouse et titulaire d'une certification consultant blockchain délivrée par Alyra, j'ai rejoint l'aventure Cointribune en 2019. Convaincu du potentiel de la blockchain pour transformer de nombreux secteurs de l'économie, j'ai pris l'engagement de sensibiliser et d'informer le grand public sur cet écosystème en constante évolution. Mon objectif est de permettre à chacun de mieux comprendre la blockchain et de saisir les opportunités qu'elle offre. Je m'efforce chaque jour de fournir une analyse objective de l'actualité, de décrypter les tendances du marché, de relayer les dernières innovations technologiques et de mettre en perspective les enjeux économiques et sociétaux de cette révolution en marche.

DISCLAIMER

The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.