Policy and regulatory developments
Kenya’s Treasury has released revised rules that cut the minimum paid-in capital requirement for stablecoin issuers by 40%, lowering it from nearly $3.9 million in the earlier draft to about $2.32 million, or 300 million Kenyan shillings. The change is intended to reduce barriers for global issuers entering the local market.
The revised framework still keeps tight controls in place. The Central Bank of Kenya would exercise broad oversight over stablecoin issuers and other virtual asset service providers. Stablecoins must be backed 1:1 by compliant reserve assets, and customers must be able to redeem at face value within two business days. On reserves, at least 30% of customer funds must be held in segregated trust accounts at Kenyan commercial banks, with the rest invested in qualified local assets. Stablecoins pegged to fiat currencies must also hold reserves in the same currency as the peg.
The Bank of Russia has published its first draft rules for “organized trading” in digital assets and digital rights, setting out proposed entry and operating standards for crypto exchanges and digital custodians. Exchanges would need their own rulebooks for trading procedures and would be required to calculate market prices and weighted average prices. The draft also envisions digital custodians responsible for recordkeeping, with registered capital between 50 million and 250 million rubles in highly liquid, high-credit-quality assets. Electronic platform operators would face similar capital requirements and would also handle omnibus account settlement for digital financial assets.
The draft has moved into regulatory impact assessment. It follows previously passed crypto market legislation and would create a framework for compliant retail trading while keeping the domestic use of cryptocurrencies for payments prohibited.
Myanmar’s military-backed parliament passed an anti-online fraud law on Tuesday. Under the law, people operating cyber fraud compounds or carrying out what it calls “digital currency fraud,” meaning crypto-related fraud, can face life imprisonment. Those who coerce others into cyber fraud through violence, torture or illegal detention can face sentences ranging from 10 years to life. If such acts lead to a victim’s death, the maximum penalty is death.
In the United States, Senate Republicans want to move the Clarity Act to a procedural vote before the August recess, but the bill still faces a crowded calendar, wavering Republican support and Democratic concerns over crypto income tied to the Trump family. The outcome is likely to hinge on moderate Democrats.
The central dispute remains ethics language. Democrats want limits on Trump benefiting from crypto businesses. Senator Ruben Gallego of Arizona is working with Senator Thom Tillis of North Carolina on a counterproposal that would add joint enforcement by state attorneys general and the Justice Department. At the same time, the banking industry is still lobbying against stablecoin reward provisions. Senator John Cornyn of Texas and Senator John Curtis of Utah have expressed sympathy with concerns over deposit outflows, while Senator Josh Hawley of Missouri said “community banks have a lot of concerns.” Even if the Senate passes the bill, review could slip into September. Earlier, 134 U.S. bank executives jointly urged the Senate to tighten the Clarity Act’s stablecoin incentive provisions.
South Korea’s presidential office also addressed volatility in local markets. Kim Yong-beom, head of the presidential policy office, said the Financial Services Commission and Financial Supervisory Service had been asked to examine structural reasons South Korean equities have been swinging more sharply than other markets. The review is not limited to leveraged ETFs and will extend to the broader market structure.
Kim said South Korea’s market has structural issues of its own and that moves of the same size in global markets often become amplified domestically. Leveraged ETFs may worsen volatility, but they are not the only factor. He said derivatives activity and investor composition should also be examined. Kim added that investor enthusiasm around the Shanghai listing of DRAM maker CXMT and progress by Chinese state-backed companies on deep ultraviolet lithography may be feeding concerns over the competitiveness of Samsung Electronics and SK Hynix, drawing comparisons with the earlier “DeepSeek shock.” South Korea’s Financial Services Commission had previously said it could consider personal investment limits if demand for single-stock leveraged ETFs does not cool.
Payments, exchanges and institutional products
PayPal reported second-quarter adjusted earnings per share of $1.38, beating analyst expectations of $1.27. Total payment volume reached $486.4 billion, also above estimates. The company raised its 2026 adjusted EPS guidance to $5.38, above last year’s level.
A previously reported acquisition proposal from private equity firm Advent and payments rival Stripe valued PayPal at roughly $60 a share, but the company did not address it in the latest statement. New CEO Enrique Lores, who took over in March, has already reorganized business lines and plans to cut about 20% of staff over the next two to three years.
Digital Currency Group-owned crypto exchange Luno plans to cut about 20% of its workforce globally as part of a restructuring and cost-control effort. CEO James Lanigan said the company will expand its B2B business and keep investing in institutional clients, core infrastructure, compliance and retail products.
Luno says it has about 16 million users across Africa and the Asia-Pacific region. It is opening up liquidity, wallet and compliance capabilities to banks, fintech firms and telecom companies so partners can offer crypto services under their own brands. The company also plans to build out non-dollar stablecoin infrastructure in emerging markets.
Visa plans to eliminate about 2,600 jobs, or roughly 7% of its workforce, mainly in technology and product teams. CEO Ryan McInerney said the move is meant to improve operating efficiency and reallocate resources to higher-potential businesses.
Visa said it wants to put more weight behind consumer payments, commercial and money movement solutions, and value-added services. That last category includes stablecoins, cross-border payments and B2B activity. The company also said AI is helping reduce repetitive work and speed up product development, though it is not the sole reason for this round of cuts.
Morgan Stanley Investment Management launched two exchange-traded products: the Morgan Stanley Ethereum Trust, or MSSE, and the Morgan Stanley Solana Trust, or MSOL, tracking Ethereum and SOL respectively.
Both products charge a 0.14% fee and plan to stake part of their holdings to earn rewards. Morgan Stanley said it will not retain the staking income. Earlier this year the firm launched its Bitcoin ETP, MSBT, meaning its crypto ETP lineup now spans Bitcoin, Ethereum and SOL.
Trading structure and platform activity
Bloomberg reported that Kalshi’s multi-leg combo bets have generated about $294 million in net losses for ordinary users so far this year, excluding fees. This month, combo betting accounted for 36% of contract volume on Kalshi.
Retail users often trade as takers at the prices shown on the interface, while professional market makers and algorithmic traders profit on the other side with automated quotes. Data cited in the report showed the average implied probability on Kalshi combo bets in 2026 was only about 9%, versus 43% in non-combo markets. Because these products involve correlations across multiple events, pricing them accurately is much harder for ordinary users. Kalshi also allows users to combine Bitcoin price outcomes with sports results.
Nansen CEO Alex Svanevik said he expects AI trading agents to outnumber human traders in roughly two years. Nansen is shifting from being a pure analytics platform toward direct execution and is rebuilding its platform around the idea of using agents to trade any asset on-chain. He said the feature has already produced more than $500 million in cumulative volume.
Svanevik added that around 10 of the top 15 perpetual contracts by trading volume on Nansen are tied to non-crypto assets, including SpaceX, the S&P 500, gold and crude oil. Nansen plans to allow more autonomous trading agents only after finishing backtesting and paper trading, aiming to reduce inference costs and limit the risk of poisoned inputs.
ARK Invest crypto research director Lorenzo Valente said on X that the crypto sector is going through the biggest consolidation phase in its history, one deeper than earlier bear markets. In his view, market structure has changed, capital is more selective, and teams and exchanges without product-market fit are shutting down. Revenue concentration has reached record highs across applications, middleware and Layer 1.
He said Hyperliquid and Pump.fun together account for 67% of total application revenue, and that figure rises to nearly 80% when Ethena is included. Valente expects more M&A, bankruptcy filings, closures and acqui-hires in the coming months, and described that as an extremely bullish signal for the industry.
Grayscale said on X that Hyperliquid, or HYPE, trades at roughly 15x to 18x forward earnings. Grayscale argued that Hyperliquid produces real cash flow and can be valued like a stock, except on earnings per token rather than earnings per share. On that basis, it said HYPE still looks inexpensive relative to fintech peers such as Coinbase, Robinhood and Circle.
Multicoin Capital moved part of its unstaked HYPE to Coinbase. After receiving 1.29 million HYPE from Hyperliquid, worth about $71.1 million, the fund quickly transferred 101,340 HYPE, worth around $5.6 million, to Coinbase. Hyperliquid has a seven-day waiting period before staked tokens return to spot balances.
An entity tied to a16z appeared to resume accumulating HYPE after what had looked like multiple rounds of selling. Over the past eight hours, it withdrew 132,056.65 HYPE worth $7.335 million from major exchanges at an average withdrawal price of $55.54. The same address has sent 398,000 HYPE, worth about $24.89 million, to exchanges since July 15.
Protocol upgrades, on-chain metrics and project updates
Zcash activated its Ironwood NU6.3 network upgrade at block height 3,428,143, introducing a new shielded pool designed to strengthen network security and make circulating ZEC independently verifiable. After the upgrade, the old Orchard pool was restricted so no new funds can enter. Existing funds must move out through a turnstile and then into Ironwood, a protocol-level design meant to ensure pool outflows never exceed verifiable inflows.
Ironwood is based on a revised protocol that has been formally verified and independently audited, and is intended to guard against risks similar to the previously disclosed declarative vulnerability in Orchard. Wallets that support Ironwood, including Zodl 3.8.0, already provide migration paths, allowing users to move funds from Orchard to the new pool without changing addresses.
Total value locked across Ethereum Layer 2 networks has fallen to about $5 billion, the lowest level since 2023, nearly wiping out the growth driven by launches such as Optimism, Arbitrum and ZKsync in 2024. Optimistic rollups still dominate. Optimism, Base and Arbitrum together account for about $4.8 billion, or 96% of total TVL.
The decline has come alongside Ethereum’s own internal strains. The Ethereum Foundation has lost several senior leaders since the start of the year, including co-executive directors, and has gone through layoffs. At the same time, traditional finance is embracing Ethereum while also using alternatives. DTCC has tokenized Treasuries on top of its $100 trillion custody base, and JPMorgan has deployed JPM Coin across multiple public chains. Stablecoins remain an exception: USDC and USDT are still settled mainly on Ethereum and its Layer 2 networks, keeping Ethereum central to the bridge between crypto and traditional finance.
Uniswap founder Hayden Adams responded on X to criticism around the v4 fee switch, saying the idea that LP fees are being reduced is a misunderstanding. The protocol fee is additive rather than deductive, he said, and LPs who earn 30 basis points per trade still earn 30 basis points.
Addressing claims that the protocol is taking 25% of LP profits, Adams said a 5 basis point protocol fee on a 30 basis point pool represents about 14% of total trading fees, while LP earnings themselves are unchanged. He also said centralized exchanges charge 100 to 200 basis points per trade, making Uniswap’s 5 basis point fee at the 30 basis point tier 20 to 40 times cheaper. Adams criticized some forks as well, saying they charge 100% of trading fees while using uneven, token-voted inflation to “compensate” LPs.
Ethereum co-founder Vitalik Buterin published a technical article titled “Obfuscation Part 2: Diamond iO,” outlining a new program obfuscation protocol. He wrote that previous conservative obfuscation approaches were totally impractical because their runtime exceeded the lifespan of the universe. By modifying the BGG+14 attribute-based encryption scheme, Diamond iO cuts runtime enough to move the field from “completely impossible” to a stage where a theoretical path can at least be seen.
Buterin said the core idea is to nest fully homomorphic encryption, or FHE, inside attribute-based encryption, or ABE. The design relies on three mechanisms: special treatment of output encoding to achieve conditional FHE decryption, modifying functions to produce pseudorandom outputs, and tensor fusion so evaluators can generate unique encodings for arbitrary inputs. Compared with conservative obfuscation, he said the approach is simpler, with only one layer of FHE nested inside ABE and no need for towers of sublinear random encodings, functional encryption and obfuscated circuits.
The article said Diamond iO relies on two newer cryptographic assumptions, all-product LWE and evasive LWE, and that its security still needs more verification. Major efficiency bottlenecks come from hash computation depth and subexponential-security parameter requirements. Buterin suggested several optimization paths, including improving Goldreich PRG implementations, finding more efficient FHE schemes and folding ABE and FHE layers together.
Security incidents and enforcement
A Blockaid report said the crypto industry lost more than $1 billion to hacks in the first half of 2026, while the number of verified exploit incidents reached a record high. By incident count, it was the most attacked half-year on record. Dollar losses were still below the same period last year because 2025 included the $1.5 billion Bybit theft.
North Korean hackers were identified as the biggest offenders, tied to the $285 million Drift theft and the $292 million KelpDAO theft. Blockaid said the pattern of targeting multisig signers through LinkedIn social engineering is likely to continue. By chain, Ethereum and Solana projects suffered the largest losses, at $332 million and $326 million respectively. The report also expects AI-related exploits to rise after the first-half theft of $216,000 from Bankr’s AI agent.
Crypto DAO’s Pro token was exploited. As of 00:23 today, the attacker and related profit-taking addresses were holding about 8.2 million USDT combined.
On BSC, the LULA token was also hit in a suspicious attack that caused losses of about $578,100.
Robinhood CEO Vlad Tenev said on X that his account on the platform was compromised last week after the attackers used social engineering to fool X customer service and bypass standard protections including two-factor authentication and login alerts. False posts about a meme coin were published. X’s security team helped remove the posts and restore access, and extra protections have since been added to the account.
Justin Ryan Schmidt, founder of crypto investment fund Translunar Crypto LP, was sentenced by a U.S. court to 37 months in prison for tax evasion. Schmidt reported less than $5,000 in income from 2020 to 2022, but prosecutors said he actually made more than $7 million through fund operations between 2019 and 2022.
Schmidt founded Translunar in 2017 and focused on blockchain startups. IRS Criminal Investigation arrested him on Feb. 23, 2026. After his arrest, Schmidt told probation officers he was single and had negative net worth of $1.1 million, but records showed he was married, his spouse was a British citizen living in the Cayman Islands, and he acknowledged net worth of at least $5.8 million. In addition to prison time, the judge ordered him to pay about $3.4 million in restitution.
Caixin, in an article titled “The Crumbling Balance Sheet of a Boxing Champion,” reported that for six individual creditors who were friends of Zou Shiming and his wife, money put into P2P products and virtual currencies was among the few categories that might still be recoverable. Real estate had already been sold, luxury goods had been liquidated at discounts, boxing gym renovations had become sunk costs, and crossover ventures had shut down. But if a platform has not been fully liquidated or a wallet address can still be traced, subrogation may still be possible. The report cited a Beijing prosecutorial case in which more than 89 million yuan in stolen funds was recovered by tracing virtual currency flows with blockchain analytics tools.
Macro pressure and market moves
Bitcoin briefly fell below $63,000 on Tuesday, touching its lowest level in nearly 10 days as a sell-off in Asian chip stocks hit U.S. technology names and spread to crypto. The move in semiconductors triggered a broader reaction across risk assets.
The pressure on tech stocks reflected concerns over returns on AI infrastructure spending. Capital expenditure guidance for 2026 from Alphabet, Microsoft, Amazon and Meta Platforms totals about $725 billion to $730 billion, and Wall Street expects that figure could rise to $900 billion in 2027. Alphabet posted negative free cash flow for the first time in the second quarter, with cash burn of $5.9 billion, even though its cloud business grew 82% on demand for AI compute.
In crypto, more than $510 million in long positions were liquidated over the past 24 hours. Analysts said a drop below $64,700 in Bitcoin could trigger a liquidation cascade because a large amount of long liquidity sits below that level.
Analysts also said any dovish signal from the Federal Reserve could be supportive for Bitcoin. Markets remain sharply split over whether the Fed will raise rates on Wednesday. CME FedWatch data showed a 70% probability of rates staying unchanged and a 30% chance of a surprise 25 basis point hike.
Block Scholes analyst Thahbib Rahman said reduced forward guidance from Fed Chair Kevin Warsh has added to uncertainty, making this FOMC meeting the most uncertain in years. Bitcoin is up about 6% so far in July, while the S&P 500 is roughly flat and semiconductor stocks have fallen nearly 20%. K33 Research head of research Vetle Lunde said Bitcoin has been consolidating near multi-year lows while the Nasdaq had been stretched after strong performance, reducing correlation between the two. He said this week’s FOMC meeting may have only a limited effect on BTC. Rahman said “any dovish signal could help Bitcoin continue to outperform.”
Nvidia’s five-year credit default swap spread at one point widened by 14 basis points to 0.82%, the biggest intraday jump in a single day since November 2025, pointing to rising concern over the company’s credit risk. Market analysis said the immediate trigger was the possibility that Nvidia could use its own credit profile to support OpenAI’s data center expansion.
The deeper concern is a circular financing loop. Nvidia may invest in, guarantee or lease data centers, those projects then use the funding to buy Nvidia chips, and stronger chip sales improve Nvidia’s profits and financing capacity, allowing it to keep supporting downstream customers.
SK Hynix reported second-quarter operating profit of 60.5 trillion won, or about $41.62 billion, up 557% from 9.2 trillion won a year earlier and marking a record high. Still, the result missed market expectations of 64 trillion won.
Revenue came in at 79 trillion won, below the 84 trillion won expected by the market. One factor was the company’s heavier weighting toward high-end HBM memory versus rivals, which left it less exposed to the latest sharp price gains in conventional memory. After the release, SK Hynix, which had already fallen 9% in Tuesday’s U.S. session, dropped another 9% at one point in after-hours trading. Sandisk and Micron also fell more than 4%.
Listings, fundraising and business expansion
Fish Audio, an AI voice startup based in Palo Alto, California, said it raised a $50 million seed round led by Coreline Ventures and Capital Today. Other investors included 359 Capital, Parable, Play Time, Alphalist Partners, Bayhouse Ventures, Carya Venture Partners and HF0.
The company said it has attracted more than 8 million users since launch last year across its open-source and hosted voice models, and now has annual recurring revenue of $21 million. Fish Audio has released four voice generation models and one speech-to-text model. Its latest product, S2.1 Pro, is available only through a paid API and already serves enterprise clients including HeyGen, Sanas and Plaud. The company plans to launch audio understanding and speech-to-speech models as it competes with ElevenLabs and Speechify.
Jump Capital has raised a $350 million fund for AI investments. The firm split its crypto team into Jump Crypto in 2021. Jump Crypto is the digital asset arm of Jump Trading.
Bitcoin miner and AI infrastructure company Ionic Digital jumped more than 25% in its Nasdaq direct listing debut, with the stock approaching $63 and implying a valuation of about $2.75 billion.
Ionic was formed in January 2024 and acquired most of the mining assets from Celsius Network’s bankruptcy restructuring, including mining rigs, infrastructure, about $195 million in cash and 540 BTC. Hut 8 initially managed Ionic’s mining operations under a four-year agreement, but Ionic terminated that arrangement less than a year later and took direct control of the sites. Hut 8 retained a minority stake.
In 2025, Ionic expanded into AI and high-performance computing infrastructure. It signed a 10-year lease with AI cloud provider Nscale carrying nearly $2 billion in contracted revenue, which could rise to $2.6 billion after a February amendment. The company still mines Bitcoin at four sites in Texas, produced nearly 25 BTC in May, and now holds 2,861 BTC, ranking around 28th among public Bitcoin holders.
Bitcoin governance and market views
Michael Saylor said in a long post on X that Bitcoin “has already won,” but that the biggest challenge now comes from internal governance risk. He argued that Bitcoin’s consensus rules are its “constitution,” and that any attempt to change them for the benefit of a specific constituency damages the economic interests of all participants.
Saylor criticized proposals including BIP-110 for trying to alter Bitcoin’s base rules, calling them examples of “one faction changing the rules and passing the cost to everyone.” He said block rewards are cut in half every 210,000 blocks, which means network security will increasingly depend on the transaction fee market. Weakening that fee market would reduce Bitcoin’s defenses right when the network needs them most. Saylor said Bitcoin should keep its base layer simple, neutral, scarce and secure, while innovation should happen in the surrounding ecosystem through voluntary adoption. In his view, protocol upgrades should remain rare and conservative, driven by necessity rather than group interests.
Other AI developments
Kimi open-sourced PerceptionBench, a benchmark designed to evaluate visual perception in multimodal large models by separating it into 10 atomic capabilities. These cover visual relations, counting, attributes, depth and 3D, localization, comparison, fine-grained recognition, contextual integration, OCR and hallucination detection.
The benchmark is built from model failure cases across 42 existing evaluation sets and contains 3,000 human-verified questions. Each question tests a single visual skill and does not require reasoning or outside knowledge. Results across 16 leading multimodal models showed that none scored above 60% overall accuracy. GPT-5.6-Sol ranked first at 59.7%, followed by Kimi K3 at 58.5%, Claude-Fable-5 at 57.2%, Gemini-3.1-Pro at 56.2% and GPT-5.5 at 55.8%. The report said hallucination remains the weakest capability across models and that overall perception performance still has substantial room to improve.
In its “AI Zao Zhidao” roundup, PANews AI Watch listed several other items from the past 24 hours. Anthropic said its Claude Mythos Preview model found two new cryptanalytic attack methods. One significantly weakens the post-quantum digital signature scheme HAWK, and another identifies a new path for attacking a simplified version of AES. The report said these findings do not currently affect any production systems.
Separately, social media posts alleged that AI companies are scanning rare books in large volumes for model training and then destroying the original books by cutting them apart. Critics described the practice as cultural destruction carried out in the name of digital preservation, sparking renewed debate over cultural protection and tech ethics.
Elon Musk also outlined the roadmap for Grok 4.6 and 4.7. He said Grok 4.6 is scheduled for Aug. 7 with 1.5 trillion parameters and significant upgrades to supervised fine-tuning and reinforcement learning. Grok 4.7, coming a few weeks later, will increase the parameter count to 2.1 trillion but run more slowly in inference.
On AI governance, more than 1,100 workers from leading AI companies signed a petition calling on the U.S. government to support mechanisms that would deliberately slow frontier AI development when necessary. The petition followed OpenAI’s disclosure that one of its AI tools had accidentally infiltrated another company’s internal system.
Organizers said employees from nearly a dozen companies had signed, including staff from OpenAI, Anthropic, Google and Meta Platforms. The petition urged the U.S. to support an international effort to set the pace for more advanced AI systems when needed, warning that the speed of progress “could indeed” exceed humanity’s ability to “understand or control” it. Google said in a statement that it is committed to developing AI in a safe and reliable way for social benefit. The petition echoes earlier calls from OpenAI CEO Sam Altman and Google DeepMind CEO Demis Hassabis for a new international oversight body to review frontier AI models and set standards.
Platform incidents and abnormal pricing
Trade.xyz said it will cover liquidation losses from a wick event in the SK Hynix perpetual contract. According to the platform, at 23:01 UTC on July 27, the SKHYNIX mark price fell from $1,127.9 to $917.25, triggering liquidations. The price was generated from an executed trade and relayed by multiple independent providers, and the oracle system functioned as designed.
Even so, Trade.xyz said it has decided to absorb the liquidation losses caused by the anomaly. Eligibility criteria will be announced soon, and distributions are expected in the coming days. The platform said this is a one-time discretionary decision and should not be seen as a guarantee for future incidents. It also said it will accelerate its review of price formation, including assumptions around outside venues and the possible use of signals from its own order book.