Cointelegraph

BGD Labs, a core technical contributor to decentralized finance protocol Aave, said it will conclude its involvement with the project’s DAO on April 1 after four years.

In a Friday forum post on Aave, BGD cited an “asymmetric organizational scenario,” which it said the DAO has “badly executed” without consideration of contributors’ expertise. The contributor added that Aave had taken an “adversarial position” of the third version (v3) of its protocol to promote features in the fourth (v4).

“While all previous points that BGD should just keep contributing on the v3 side exclusively, the situation created makes it nonsensical to us: every time we think/will think about improving v3, there will be some type of implicit/explicit artificial constraint,” said BGD. “We are not really interested in being in that position, as we think it is a waste of our potential.”

As part of the winding down of its collaboration with Aave, BGD said “nothing changes” until April 1, and the project would continue to contribute to v3, Umbrella, chain expansions, security and assets’ onboarding.

Existing projects likely to continue after its contributions end will have maintenance guidelines, but BGD said there was not a “direct off-boarding path” for the project to contribute to the Aave protocol. It proposed a two-month, $200,000 security retainer for the community to consider beyond April as Aave finds a potential replacement.

“BGD Labs was created in early 2022 to build in the DeFi/web3 ecosystem,” said the forum post. “Since then, we have been almost exclusively focused on our contribution to Aave: any technical sub-system of Aave that the community knows about, BGD Labs was leading its development, or at least participating/collaborating with other entities in it.”

Aave users react to BGD departure

Reactions from many users to the news were largely positive toward BGD, with many expressing concerns about the loss of a significant contributor to the DeFi protocol.

“If independent contributors feel sidelined by DAO-level centralization, maybe the answer is just structural clarity inside the DAO,” said user JosueMpia. “Because this feels bigger than one team leaving.”

Some users accused Aave founder and CEO Stani Kulechov of being responsible for the project’s departure. The CEO also responded to the post, praising BGD for its role:

“I respect BGD’s decision, though I am sad to see them go. The DeFi ecosystem is better for having a team like BGD in it and I hope they continue to build and make contributions to the industry.”

Magazine: IronClaw rivals OpenClaw, Olas launches bots for Polymarket — AI Eye

Bitcoin (BTC) saw choppy price action after Friday’s Wall Street open as markets reacted to the US Supreme Court decision on President Donald Trump’s trade tariffs.

Key points:

The US Supreme Court rules that certain US tariffs are illegal, sparking a modest risk-asset response.

US inflation data further cuts market hopes of a March interest-rate cut.

Bitcoin price action stays rooted in a firm range, with consensus seeing bears “in control.”

Supreme Court ruling attacks Trump tariffs

Data from TradingView showed $67,000 forming a focus for BTC price action, while US stocks gained.

BTC/USD one-hour chart. Source: Cointelegraph/TradingView

The overall risk-asset response was muted however, as the Supreme Court ruled that some tariffs remained legal. In the firing line were those implemented under the International Emergency Economic Powers Act (IEEPA).

“IEEPA does not authorize the President to impose tariffs,” the Court wrote in its 170-page ruling.

Despite this, talk quickly surfaced over triff refunds, with trading resource The Kobeissi Letter putting the potential total at $150 billion.

“Today's Supreme Court ruling will be referenced for decades to come,” it added in a thread on X.

The event overshadowed earlier US macro data, which missed expectations. The Personal Consumption Expenditures (PCE) Index, known as the Federal Reserve’s “preferred” inflation gauge, hit its highest levels since late 2023 at 3%.

US PCE data (screenshot). Source: Bureau of Economic Analysis

GDP data for Q4 2025, meanwhile, came in much lower than anticipated at 1.4% growth instead of 3%.

The numbers further reduced the odds of the Fed cutting interest rates at its March meeting, with data from CME Group’s FedWatch Tool now seeing a mere 4% chance of a 0.25% reduction.

Fed target rate probabilities for March FOMC meeting (screenshot). Source: CME Group

On Thursday, trading resource Mosaic Asset Company expressed hope that stocks could still perform well despite the gloomy rates outlook.

“Even if the Fed goes an extended period on hold with interest rates, it’s worth remembering that financial conditions are still running much looser than average,” it summarized in an update. 

“That should remain a tailwind for the bull market for now, even if the S&P 500 doesn’t reflect it. The combination of loose conditions and strong market breadth means a positive backdrop for position trading (for now).”

Bitcoin failing to escape “downwards trajectory”

Bitcoin traders continued to have few illusions about the precarious state of the market.

In his latest analysis, trader Jelle said that bears were still “in control.”

Bears remain in control - driving price lower and lower.

Don't fight the trend, embrace it as the opportunity it presents: another chance to load up on cheaper coins.$BTC pic.twitter.com/wnhrKanAUb

— Jelle (@CryptoJelleNL) February 20, 2026

Trader and analyst Rekt Capital emphasized the importance of the 200-week exponential moving average (EMA) — along with Bitcoin risking flipping it to resistance.

“History suggests Weekly Closes below the 200-week EMA followed by bearish retests of the EMA into new resistance can spur on the next phase of Bearish Acceleration to the downside,” he wrote on Thursday.

BTC/USD one-week chart with 200 EMA. Source: Rekt Capital/X

Earlier in the week, trader and commentator Skew suggested that the local BTC price range was indicative of “developing ‘value.’”

“Clear respected market supply around $70K & Clear tested market demand around $65K. This essentially points out the obvious which is a sustained move above $70K or below $65K will lead to trending price action,” he told X followers.

“Since the trend is in a downwards trajectory currently, this makes $72K quite significant as many shorts will place stops above & also it acts as a near term invalidation if cracked.”

Crypto treasury executives are calling on the Basel Committee on Banking Supervision (BCBS), an international banking regulatory body, to revise the 1,250% risk weight for Bitcoin and other cryptocurrencies under the Basel III framework.

The 1,250% capital requirement means that banks must back any Bitcoin (BTC) on their balance sheets at a 1:1 ratio with approved collateral, making BTC holding more costly than other asset classes.

For comparison, cash, physical gold and government debt carry a 0% risk weight under the Basel III framework.

Basel III risk weights for different asset classes held by banking institutions. Source: Jeff Walton

“If the US wants to be the 'crypto capital' of the world, the banking regulations need to change. Risk is mispriced,” Jeff Walton, chief risk officer at Bitcoin treasury company Strive, wrote on X.

The capital rules under Basel III discourage banks from holding BTC and crypto because of the relatively high collateral cost of holding digital assets, which lower a bank’s return on equity, a critical metric for bank profitability, according to Chris Perkins, president of investment company CoinFund.

Related: Banks can’t seem to service crypto, even as it goes mainstream

Basel responds to growing backlash and pressure from the crypto industry

The Basel Committee proposed the current risk weightings in 2021, placing BTC and other cryptocurrencies in the highest risk category and imposing a 1,250% risk weight on digital assets.

In 2024, the committee finalized the capital requirements outlined in the 2021 proposal, which drew heavy backlash from the crypto industry.

Phong Le, CEO of Strategy, the largest Bitcoin treasury company, urges reform of the current Basel III crypto risk weighting. Source: Phong Le

The current rules represent a “different type of chokepoint” than the overt debanking of crypto companies in what some industry insiders dubbed Operation Chokepoint 2.0, Perkins told Cointelegraph in August 2025.

“It’s a very nuanced way of suppressing activity by making it so expensive for the bank to do those activities,” Perkins said.

In October 2025, reports emerged that the committee was considering easing the capital requirements for digital assets in response to the surge in the stablecoin market cap, which is nearing $300 billion, according to data from RWA.xyz. 

The following month, Erik Thedéen, chair of the BCBS, said the international banking regulator may need a “different approach” to the 1,250% risk weight for cryptocurrencies, signaling a potential change in collateral requirements.

Magazine: Crypto wanted to overthrow banks, now it’s becoming them in the stablecoin fight

A US federal judge in Tennessee has temporarily blocked the state from enforcing its gambling laws against prediction markets operator Kalshi’s sports event contracts. 

The ruling, issued by Judge Aleta Trauger of the US District Court for the Middle District of Tennessee on Thursday, allows Kalshi to continue offering sports-related event contracts to users in the state while its lawsuit against Tennessee regulators proceeds.

Trauger found that Kalshi is likely to succeed on the merits of its claim that federal commodities law preempts Tennessee’s attempt to regulate its sports markets as illegal gambling. 

The court concluded that Kalshi’s sports event contracts are “swaps” under the Commodity Exchange Act, over which the law grants the US Commodity Futures Trading Commission (CFTC) exclusive jurisdiction, and held that Tennessee’s enforcement efforts are likely preempted under conflict preemption principles. 

Preliminary injunction, Kalshi. Source: CourtListener

The injunction applies to the named state officials, while the Tennessee Sports Wagering Council itself was dismissed on sovereign immunity grounds, and Kalshi was ordered to post a $500,000 bond.

Long-running clash with states

The Tennessee case marks another chapter in a broader clash over how to treat event contracts in the United States.

An earlier temporary restraining order from Judge Trauger had already paused enforcement of Tennessee’s cease-and-desist letter, which alleged that Kalshi was operating unlicensed sports wagering, ordered it to stop offering sports event contracts to customers in Tennessee, void those contracts, and refund deposits, and threatened fines and further legal action. 

Kalshi has similarly gone to federal court in multiple states, including Nevada, New Jersey, and Connecticut, over cease-and-desist actions targeting its event markets, with courts reaching divergent conclusions on whether to grant preliminary relief.

CFTC steps in to defend prediction markets

​The injunction also lands against a shifting federal backdrop, as the CFTC moves to assert primacy over prediction markets.

In a video message on Tuesday, CFTC Chair Michael Selig said the agency had filed a friend-of-the-court brief to defend its “exclusive jurisdiction” over prediction markets, warning state authorities that the Commission would meet them in court if they tried to undermine federal oversight of these derivative markets.

AI Eye: IronClaw rivals OpenClaw, Olas launches bots for Polymarket

​

Opinion by: Darius Moukhtarzadeh, research strategist at 21Shares

AI agents took the crypto industry by storm in late 2024 and then slipped out of focus as newer narratives absorbed attention — stablecoin chains, perpetual decentralized exchanges, prediction markets and privacy among them. The agent conversation is quietly accelerating again, but this time it is less about chatbots and more about commerce: agents paying for services, coordinating with other agents, and settling value autonomously.

Agents are increasingly capable of acting on behalf of users, as recently seen with OpenClaw, wherein open-source autonomous agents with persistent memory and execution access can operate. Yet, most of the internet still treats them as untrusted traffic. APIs block them, merchants rate-limit them, and payment systems assume a human is present for each purchase. The bottleneck is not intelligence — it is trust and accountability across organizational boundaries.

That is why the next phase of the AI economy hinges on whether agents can transact in open markets without relying on closed platforms. Autonomous agent commerce requires three primitives: discovery of services, verification of trust, and settlement of payments.

Two crypto standards, Coinbase’s x402 payments protocol and Ethereum’s ERC-8004 (the “Trustless Agents” standard), are beginning to supply that missing foundation. Despite the name, ERC-8004 is not limited to AI agents, it is designed as a broader trust and discovery layer for machine-accessible services.

From Know Your Customer to Know Your Agent

Human commerce runs on identity, liability and reputation. Autonomous software needs the same primitives, except it cannot rely on brand recognition, contracts buried in PDFs or informal social trust. A growing view in the industry is that commerce is shifting from Know Your Customer (KYC) to Know Your Agent (KYA). Agents will need cryptographically verifiable credentials that link them to a principal, constraints and an auditable performance history.

Without those guarantees, merchants have little incentive for allowing autonomous access. Blocking agents at the firewall is often rational risk management. There is no standardized way to assess recourse, attribute actions or separate good agents from bad ones.

ERC-8004 is designed to address that gap. The standard proposes using blockchains to “discover, choose, and interact with agents across organizational boundaries without pre-existing trust,” enabling open-ended agent economies. In late January 2026, ERC-8004 went live on Ethereum mainnet after roughly five months of ecosystem work, with “singletons” deployed to major Layer 2 networks such as Base, Abstract, Arbitrum, Optimism, MegaETH, BSC, and others. In the first two weeks alone over 24k agents registered on Ethereum using the standard. 

At a structural level, ERC-8004 establishes three lightweight registries. Importantly, these registries can describe not only agents but also APIs, data providers, and other automated services. The identity registry provides portable, censorship-resistant agent identifiers, implemented in a way that makes identities browsable and transferable in NFT-compatible applications. Alongside this, the reputation registry defines an interface for signed, attestable feedback from clients, closer to verified service ratings than platform-controlled reviews. Finally, the validation registry introduces an optional verification pathway for higher-stakes tasks, allowing third parties to attest to outcomes using different models such as crypto-economic checks and formal attestations. Notably, this validation layer is still being rolled out and is not yet universally available in production form.

Importantly, ERC-8004 does not attempt to move agent execution onchain. It keeps application logic offchain while anchoring discovery and trust in a neutral public registry. That separation (offchain performance with onchain accountability) is a key reason the standard can be adopted by many different teams without forcing them into one runtime or one platform.

Payments are the missing half

Identity and reputation alone do not unlock agentic commerce. Agents must also be able to pay instantly, programmatically and in amounts small enough to match machine-level consumption. That is the economic reality of agent workflows: API calls, data queries and AI inference are metered per request, not bundled neatly into a monthly subscription.

This is where x402 enters the picture. Developed by Coinbase, x402 is a chain-agnostic, HTTP-native payments protocol that enables an API to request payment directly in the web’s request-response flow, without accounts, subscriptions or API keys. Coinbase describes it as “internet-native” and designed to monetize APIs and AI models per call or per inference.

X402’s traction is increasingly tied to enterprise standards work. Google has publicly described collaborating with Coinbase and others on an “A2A x402 extension” for agent-based crypto payments. This matters because it places stablecoin settlement inside familiar developer workflows rather than pushing developers into bespoke checkout systems.

The economics are also moving in the direction agent commerce requires. Independent research and ecosystem commentary indicate that average x402 transactions have compressed toward true micropayments, on the order of a few cents, which is precisely where card-style fixed fees become untenable at scale.

Stablecoin settlement is structurally better suited to that environment: variable fees, near-instant settlement and programmability that can tie payment to completion conditions. In agent commerce, “pay-per-use” is not a pricing gimmick; it is the natural unit of consumption.

Trust plus payments create open agent markets

Individually, x402 and ERC-8004 are useful. Together, they create something closer to a complete market design for machine-native services, whether autonomous agents or the tools and APIs they rely on. Services become discoverable by default, as agents can publish their capabilities to a public registry, enabling web-scale discovery without gatekeepers. Reputation is earned and portable, allowing performance history to follow an agent across platforms rather than remaining trapped inside a single company’s dashboard. At the same time, settlement can be directly tied to tasks, with payments executed as part of a machine workflow and proofs of payment accumulating into the agent’s trust record over time.

Consider a delegated research task. A user authorizes an agent with a defined budget and scope. The agent discovers specialized data-collection agents through ERC-8004, selects them based on reputation signals, pays for premium data sets via x402 and returns an auditable report, without subscriptions, invoicing or manual coordination. This is not only a consumer story; the same pattern extends to finance, data markets and autonomous infrastructure, where agents increasingly behave like microservice businesses.

Ethereum is pulling ahead

Gartner estimates that by 2030, agents could influence or participate in as much as $30 trillion in purchases. That number is less important than the direction: More economic activity will be intermediated by autonomous software. If discovery, identity and reputation end up controlled by a small number of companies, as happened with mobile distribution, then censorship and fee extraction become default outcomes for a growing share of GDP.

Ethereum’s advantage in this race is not that it is the fastest chain (which is not the case). It offers credible neutrality and composability for identity and reputation, primitives that become more important as agents begin coordinating across companies and handling real economic value. ERC-8004 itself is co-authored across major organizations spanning crypto and Big Tech, underscoring the push toward an interoperable trust layer rather than yet another walled garden.

None of this implies a single-chain future. High-frequency micropayments may route through multiple networks depending on cost and latency. But when agents need durable identity, portable reputation and a settlement layer designed to be neutral infrastructure, Ethereum’s layer-1 and layer-2 ecosystem is positioning itself as the anchor point.

Agentic payments will not be unlocked by hype cycles or bigger models; they will be unlocked by boring, interoperable standards, discovery, trust and settlement that let autonomous agents become full economic participants without asking permission from gatekeepers. With ERC-8004 now live on mainnet and x402 maturing into a web-native payment primitive, the rails for that economy are starting to look real.

Opinion by: Darius Moukhtarzadeh, research strategist at 21Shares.

As cryptocurrency is becoming increasingly intertwined with the traditional financial world, it’s also forming the foundation of a parallel, shadow financial system.

A January report from TRM Labs found a surge in illicit or illegal crypto use to an all-time high of $158 billion. This included a massive increase in crypto flows related to sanctions evasion.

This was led primarily by A7A5, a Russian ruble-based stablecoin launched by Russia-based company A7. Some $39 billion in sanctions-related crypto flows were attributed to the A7 wallet cluster.

Far from a small, underground system for illicit activity, A7A5 has facilitated billions of dollars’ worth of commercial activity, creating a “shadow” economy built on crypto.

Sanctions and the rise of A7A5

After Russia invaded Ukraine in February 2022, it faced a raft of sanctions excluding the country and companies based there from participating in the global financial system.

Mastercard and Visa suspended international operations for cards issued in Russia, while cards issued abroad stopped functioning in the country. Russian banks were also closed off from SWIFT, severely limiting the ability of companies based in the country to conduct commerce abroad.

While these major Western payment networks were shut off, alternatives grew. Mir, the Russian payment network founded in 2017, expanded its market share after Visa and Mastercard’s exit.

Russia also turned to crypto for international commerce. In December 2024, Russian Finance Minister Anton Siluanov noted that his government had passed legislation authorizing foreign trade in “digital financial assets” and Bitcoin (BTC) that was mined in Russia. While Siluanov did not recommend crypto as a form of investment, he claimed that it was “the future” in the context of global payments settlement.

Enter A7A5. The coin was first introduced in February 2025 by the eponymous A7 financial platform. According to legal and professional services firm Astraea Group, A7 is co-owned by Moldovan oligarch Ilan Shor, himself sanctioned and residing in Russia, and the state-owned Promsvyazbank (PSB), which has strong ties to Russia’s defense industry.

Shor and PSB developed a group of companies in strategically important sectors like oil, gas, metals, chemicals and defense technologies. These include A7-Agent, A7 Goldinvest and A71.

A7A5’s blockchain contract launched in February 2025 and soon began trading on Moscow-based exchange Garantex, which was subsequently sanctioned and shut down.

Trading has continued on Grinex. According to Chainalysis, this Kyrgyzstan-based exchange is the confirmed successor of its Russian counterpart and was accepting transfers from Garantex immediately after its sanction-induced closure.

The token was also launched on Kyrgyzstan-based platform Meer, as well as Bitpapa. Despite sanctions from the Office of Foreign Assets Control (OFAC) on all these platforms, token asset growth exploded in 2025.

Token growth spiked after trading began on Bitpapa. Source: Chainalysis

Creating an alternative, sanctions-proof system

Analysts have noted that the illicit crypto economy has evolved beyond the darknet and ransomware but has become a separate, robust financial system for sanctioned actors.

Ari Redbord, global head of policy at TRM Labs, said, “State-aligned actors, professional criminals and sanctions evaders are no longer experimenting with crypto; they’re operating durable financial infrastructure onchain.”

He continued that, in 2025, Russia’s illicit crypto ecosystem “evolved into something far more deliberate ... Wallets tied to the A7 network alone accounted for at least $39 billion, reflecting coordinated, state-aligned financial infrastructure built for sanctions evasion, not broad market use.”

State coordination with A7A5 and tie-ins with the broader Russian financial market are further evidenced by daily asset flows, according to Chainalysis. The vast majority of trades occur Monday through Friday, with the largest number of trades at the beginning of the week.

Source: Chainalysis

“These trading patterns suggest that A7A5 is primarily being used by businesses operating Monday through Friday, which would align with Russia’s legislative goals of facilitating cross-border transfers for Russian businesses via cryptocurrency,” wrote Chainalysis.

Andrew Firman, head of national security at Chainalysis, told Radio Free Europe in December 2025, “The A7A5 token development seems like Russia’s next logical step in Russia’s efforts to develop alternative payment systems to circumvent sanctions.”

In its report, TRM Labs stated that A7A5 volumes don’t represent sanctions evasion but sanctioned activity “more broadly, including state-aligned economic flows.”

“These dynamics illustrate how Russia-linked actors are increasingly leveraging crypto — particularly stablecoins and higher-risk services — as part of a long-term, nation-state-backed strategy.”

Oleg Ogienko, A7A5’s director for regulatory and overseas affairs, has told crypto news media that his company is not violating the laws of Kyrgyzstan, where doing business with Russian companies is not prohibited. He added that the company conducts Know Your Customer and Anti-Money Laundering procedures, as well as audits, and doesn’t violate Financial Action Task Force principles.

A company spokesperson previously told Cointelegraph that accusations of sanctions evasion “are politicized and lack factual evidence.”

“Companies and individuals globally use the A7A5 ruble stablecoin for export-import contracts, cross-border payments and blockchain projects. Its growth reflects a nondiscriminatory approach to value transfer on the blockchain,” they said.

Ambitions for further growth in the sector are apparent. In July, A7A5 announced that PSB cardholders will be able to purchase tokens with their cards. It plans to extend this service to other banks in the future.

In the space of a year, A7A5 has grown into an effective alternative payment rail for sanctioned parties. Time will tell how much appetite there is to grow this further.

Magazine: Is China hoarding gold so yuan becomes global reserve instead of USD?

Democrats in the US House of Representatives are pressing Treasury Secretary Scott Bessent over how regulators are handling World Liberty Financial’s bid for a national trust bank charter to issue a dollar-backed token.

In a Feb. 19 letter, 41 House Financial Services Committee Democrats led by Representative Gregory Meeks cited systemic risk, foreign ownership and potential political pressure on the bank chartering process. 

They asked Bessent to explain what safeguards exist to prevent foreign government officials or politically connected investors from using the charter process to gain leverage over the US financial system.

​The lawmakers pointed to reporting that a senior royal from the United Arab Emirates quietly acquired nearly half of World Liberty Financial for roughly $500 million, including a reported $187 million flowing to Trump-affiliated entities, while the company pursued a national trust bank charter with the Office of the Comptroller of the Currency (OCC).

Democrats’ letter to Treasury Secretary Scott Bessent. Source: Meeks.house.gov

They argued that the combination of digital asset trust structures, untested liquidity and resolution frameworks and foreign political interests raised questions that regulators “cannot afford to sidestep.”

​Democrats also questioned whether Executive Order 14215, which they say pulled traditionally independent financial regulators into closer White House oversight, could compromise the OCC’s autonomy in deciding on World Liberty’s application. 

The letter asks Bessent to detail the role of the White House, the Office of Management and Budget, and the Treasury Department in OCC charter decisions, and to respond in writing by Feb. 26.

World Liberty Financial’s high profile

The letter arrives as World Liberty Financial and other Trump-aligned crypto initiatives raise their profile in Washington and on Wall Street, including through a well-attended crypto event at Trump’s Mar-a-Lago club on Wednesday that drew crypto and traditional finance executives, such as Coinbase CEO Brian Armstrong, Binance co-founder Changpeng Zhao and Goldman Sachs CEO David Solomon. 

In the run-up to the event, the WLFI token associated with the Trump family-aligned platform recorded a 23% gain as organizers promoted the event as a venue to spotlight World Liberty’s roadmap and its role in the broader crypto market.

No bail out of “cryptocurrency billionaires” 

Separately, Senate Banking Committee Democratic Senator Elizabeth Warren urged Bessent and Federal Reserve Chair Jerome Powell on Wednesday not to deploy taxpayer-backed support to stabilize crypto markets. She warned that any bailout of “cryptocurrency billionaires” would create a moral hazard and shift losses from large investors onto taxpayers. 

Warren’s letter framed potential rescue measures for major crypto firms and investors as a test of whether policymakers would extend bank-style backstops to the digital asset sector, as regulators weigh new charters and oversight for crypto-linked institutions.

Big Questions: Is China hoarding gold so yuan becomes global reserve instead of USD?

Tether’s USDT, the world’s largest US dollar-pegged stablecoin, is heading for its steepest monthly decline in years as large holders step up redemptions, according to blockchain data.

The circulating supply of USDt (USDT) fell by about $1.5 billion so far in February, following an $1.2 billion decrease in January, according to Artemis Analytics data reported by Bloomberg. This puts USDT on track for the biggest monthly drop in three years, weeks after the collapse of cryptocurrency exchange FTX in November 2022.

The USDT supply logged a $2 billion decrease in December 2022 after the collapse of FTX and its 150 subsidiaries sent shockwaves through the crypto industry.

The decline may signal a contraction in crypto market liquidity, as Tether’s USDT is the primary on-ramp for crypto investors. Its $183 billion market capitalization accounts for about 71% of the total stablecoin market, according to CoinMarketCap. 

Tether USDT, monthly percentage supply change, monthly aggregate. Source: Artemis Analytics, Bloomberg

Cointelegraph reached out to Tether for comment on what is driving the February supply drop, but had not received a response by publication.

Related: BlackRock enters DeFi as institutional crypto push accelerates: Finance Redefined

Total stablecoin market cap flat in February

The pullback in USDT has not translated into a broader contraction across dollar-linked stablecoins.

The total market capitalization of stablecoins across all exchanges has risen 2.33% so far in February, from $300 billion to $307 billion, according to DeFiLlama data.

Total stablecoin market capitalization. Source: DeFiLlama

While the two leading stablecoins, USDT and Circle’s USDC (USDC), both decreased by 1.7% and 0.9%, respectively, the Trump-family-linked World Liberty Financial’s USD1 (USD1) stablecoin recorded a 50% increase in market capitalization over the past month and was valued at $5.1 billion as of Friday, according to DeFiLlama.

Related: Wells Fargo sees ‘YOLO’ trade driving $150B into Bitcoin and risk assets

Whales and smart money traders offload USDT, but fresh wallets stepping in

Whales, or large cryptocurrency investors, have been cutting their USDT holdings, but new participants are bringing fresh demand for the leading stablecoin.

Whale wallets sold $69.9 million USDT across 22 wallets over the past week, marking a 1.6-fold increase in the selling rate of this cohort, according to crypto intelligence platform Nansen.

USDT on Ethereum, token God mode, 1-year chart. Source: Nansen

The leading traders by returns, tracked as “smart money,” have also been net sellers of USDT. At the same time, new wallets created in the past 15 days bought roughly $591 million worth of USDT over the week, according to the platform.

The mixed flows highlight a market split between large holders redeeming or reallocating capital and new entrants stepping in to take the other side, even as overall stablecoin issuance remains broadly steady.

Magazine: Crypto wanted to overthrow banks, now it’s becoming them in stablecoin fight

Selling pressure in US-listed spot Bitcoin ETFs continued Thursday, with analysts noting the cryptocurrency is on track for one of its worst yearly starts.

Spot Bitcoin (BTC) ETFs saw $165.8 million in outflows Thursday, bringing weekly losses to $403.9 million, according to SoSoValue data.

The redemptions moved the funds closer to a potential five-week outflow streak, with year-to-date (YTD) losses totaling $2.7 billion.

Daily flows in US spot Bitcoin ETFs this week. Source: SoSoValue

Trading activity continued to shrink, falling 21% over the week and reaching its lowest levels since late December, signaling weakening investor activity.

Despite $53.9 billion in cumulative net inflows, analysts, including DropsTab, noted that 2026 is shaping up to be “one of the worst yearly starts in Bitcoin’s history,” with BTC prices down roughly 22% year-to-date, according to TradingView data.

BlackRock’s IBIT leads losses with $368 million in outflows this week

BlackRock’s iShares Bitcoin Trust ETF (IBIT) accounted for the bulk of outflows this week, totaling $368 million, according to Farside data.

Other US-listed spot Bitcoin ETFs saw little or no activity this week, aside from roughly $50 million in outflows from the Fidelity Wise Origin Bitcoin Fund (FBTC) on Wednesday.

Daily flows in US spot Bitcoin ETFs by issuer. Source: Farside.co.uk

Some major financial institutions reported reducing IBIT exposure earlier this week, with Brevan Howard cutting its holding in the fund by as much as 85% in the fourth quarter of 2025.

Bitcoin set for one of its worst yearly starts

The ongoing outflows from Bitcoin ETFs coincide with weakening investor sentiment, as multiple sources point to unusually low BTC price levels compared to previous cycles.

Drops Analytics highlighted Bitcoin’s price in the context of halving — an event that reduces BTC’s block reward once every four years and is typically followed by price surges in the years that follow.

Source: Drops Analytics

“Almost two years later, BTC trades around $66,000 — nearly the same level as during the April 2024 halving,” Drops Analytics said in a Telegram post on Thursday.

“This has never happened before. In previous cycles, BTC was already three to 10 times above halving levels by now,” it added.

According to Checkonchain data, Bitcoin is off to its worst yearly start on record, 50 days into 2026, surpassing previous down years, including 2018.

Magazine: Did a Hong Kong fund kill Bitcoin? Bithumb’s ‘phantom’ BTC: Asia Express

Metaplanet CEO Simon Gerovich has pushed back against accusations from what he called “anonymous accounts” that the company misled investors about its Bitcoin strategy and disclosures.

Critics on X argued that Metaplanet delayed or withheld price‑sensitive information about large Bitcoin (BTC) purchases and options trades funded with shareholder capital, obscured losses from its derivatives strategy, and failed to fully disclose key terms of its BTC‑backed borrowings.

In a detailed X post on Friday, Gerovich argued that Metaplanet promptly reported all Bitcoin purchases, option strategies, and borrowings, and that critics were misreading its financial statements rather than uncovering misconduct.

September buys and disclosures

Gerovich said that Metaplanet had made four Bitcoin purchases in September 2025 and “promptly announced” each one, rejecting claims the company secretly bought at the local peak without disclosure. 

Metaplanet’s real-time public dashboard corroborates the purchases, showing the firm purchased 1,009 BTC on Sept. 1, 136 BTC on Sept. 8, 5,419 BTC on Sept. 22, and 5,268 BTC on Sept. 30, 2025. 

The purchases are also reflected on public tracker Bitcointreasuries.net, along with the public announcements and/or financial statements.

Metaplanet announcement of BTC purchase. Source: Metaplanet

Gerovich also stressed that selling put options and put spreads was designed to acquire BTC below spot and monetize volatility for shareholders rather than to gamble on short‑term price moves.

Measuring performance by different metrics

The Metaplanet CEO also contested the use of net profit as a yardstick for a Bitcoin treasury company, pointing instead to soaring revenue and operating profit from Bitcoin‑related activities, especially options income. 

Metaplanet reported fiscal 2025 revenue of 8.9 billion Japanese yen (around $58 million) on Monday, up roughly 738% year‑on‑year, even while booking a net loss of about $680 million due to the sharp decrease in price of its Bitcoin holdings. 

Gerovich said that treating those non‑cash losses as evidence of strategic failure misunderstood the accounting treatment of assets.

He noted that Metaplanet had established a credit facility in October 2025 and disclosed subsequent drawdowns in November and December, including information on borrowing amounts, collateral, structure and broad interest terms, all viewable on Metaplanet’s disclosures page.

The lender’s identity and exact rates were withheld, Gerovich said, at the counterparty’s request. 

Finally, he argued that the borrowing conditions were favorable for Metaplanet and that the company’s balance sheet remained solid despite Bitcoin’s drawdown.

Wider backlash against BTC treasury plays

Gerovich’s defense comes as other listed Bitcoin treasury plays face scrutiny of their own over the sustainability and risk of their Bitcoin‑heavy treasury model.

Strategy, the largest corporate holder of BTC, reported a $12.4 billion net loss in the fourth quarter of 2025 as Bitcoin fell around 22% over the period, although it emphasized a “stronger and more resilient” capital structure and an “indefinite” Bitcoin time horizon. 

Cointelegraph reached out to Metaplanet for additional comment, but had not received a response by publication.

Big Questions: Is China hoarding gold so yuan becomes global reserve instead of USD?

South Korean lawmakers are stepping up pressure on financial regulators after crypto exchange Bithumb mistakenly credited customers with Bitcoin it did not hold, an error that briefly sparked a rush to sell and renewed questions about oversight of the country’s fast-growing digital-asset market.

Lawmakers said the Financial Services Commission (FSC) failed to detect critical flaws in Bithumb’s internal systems despite at least three inspections since 2022, The Korea Times reported Thursday.

Representative Kang Min-guk of the main opposition People Power Party said the incident is more than a technical mishap, claiming structural weaknesses in the crypto market, including gaps in regulation and oversight.

Bithumb mistakenly credited 2,000 Bitcoin (BTC) per user instead of 2,000 Korean won ($1.4) during a promotional event on Feb. 6, distributing a total of 620,000 BTC that the exchange did not actually hold.

FSC delays probe into Bithumb, intensifying accusations

Lawmakers’ criticism of the FSC intensified as the regulator delayed its inspection of Bithumb. The authority opened the investigation on Feb. 10, with FSC officials emphasizing they would take “stern legal actions against acts that harm the market order.”

The probe, initially expected to conclude last Friday, has now been extended, with officials aiming to complete it by the end of February, citing the need for additional review, multiple local publications reported.

Bithumb CEO cites two prior payout incidents

The FSC’s inspection of Bithumb reportedly covers not only the recent 620,000 BTC error, but also two similar incidents in the past.

“There were two previous cases in which coins were mistakenly paid out and later recovered, but the amounts were minimal,” Bithumb CEO Lee Jae-won said during an emergency National Assembly session on Feb. 11.

From left: FSC vice chairman Kwon Dae-young, FSC governor Lee Chan-jin and Bithumb CEO Lee Jae-won during a National Assembly session on Feb. 11. Source: The Korea Times

In the latest incident, Bithumb said it managed to recover the majority of miscredited assets, with only 125 BTC ($8.6 million) out of the non-existent 620,000 BTC unrecovered.

Concerns over South Korea’s handling of crypto: The case of the disappearing Bitcoin

The Bithumb incident also lands as authorities face renewed embarrassment over custody and security of seized digital assets.

In 2021, 22 BTC, worth around $1.5 million at current prices, disappeared from a cold wallet at Seoul’s Gangnam Police Station during a nationwide audit.

A separate August 2025 case saw 320 BTC vanish from the Gwangju District Prosecutors’ Office, reportedly due to a leaked password. Authorities only reported yesterday that the full amount had been recovered after the hacker returned the funds, raising eyebrows as the disclosure comes amid the ongoing FSS investigation into Bithumb.

Lawmakers and industry observers say these incidents underscore persistent weaknesses in authorities’ oversight and custody of digital assets.

Magazine: How crypto laws changed in 2025 — and how they’ll change in 2026

On-chain analytics firm Parsec is closing down after five years, as crypto trader flows and on-chain activity no longer resemble what they once did.

“Parsec is shutting down,” the company said in an X post on Thursday, while its CEO, Will Sheehan, said the “market zigged while we zagged a few too many times.”

Sheehan added that Parsec’s primary focus on decentralized finance and non-fungible tokens (NFTs) fell out of step with where the industry has now headed.

“Post FTX DeFi spot lending leverage never really came back in the same way, it changed, morphed into something we understood less,” he said, adding on-chain activity changed in a way he never understood.

NFT sales reached about $5.63 billion in 2025, a drawdown of 37% from the $8.9 billion recorded in 2024. Average sale prices also declined year over year, falling to $96 from $124, according to CryptoSlam data.

“Quite the ride,” Parsec says

Parsec, which had received investment from major industry players such as UniSwap, Polychain Capital, and Galaxy Digital, launched in early January 2021, just months before Bitcoin (BTC) surged from around $36,000 to $60,000 by April, just four months later. 

Source: Parsec

The company added in its X post that they are “eternally grateful to those that traversed the ups and downs on-chain.” 

“It was quite the ride,” Parsec said.

Alex Svanevik, the CEO of on-chain analytics platform Nansen, said that Parsec “had a great run.”

Crypto industry may be heading for consolidation

It comes just weeks after crypto start-up Entropy announced it is closing down and returning funds to investors, citing scaling issues and a struggle to find product-market fit.

Bullish CEO Tom Farley predicted during an interview with CNBC on Feb. 8 that the industry will see a significant consolidation in the coming months with more projects snapped up by larger companies, which may lead to a much less fragmented sector overall.

Meanwhile, Bitcoin’s price has declined 46% from its October all-time high of $126,100 to now trade at $67,246, according to CoinMarketCap.

Meanwhile, Google searches for “Bitcoin going to zero” have surged to their highest level since the post‑FTX panic in November 2022, according to Google Trends data for the past five years. 

Magazine: Bitcoin may take 7 years to upgrade to post-quantum: BIP-360 co-author

The White House has reportedly refocused talks between crypto and bank lobbyists on limiting how stablecoin rewards should be paid in the third meeting between the two groups over a crypto market structure bill.

Crypto and banking industry representatives met at the White House on Thursday for the third time in 16 days to discuss stablecoin provisions that have stalled the crypto bill which the Senate is looking to pass.

No agreement was reached on Thursday, but executives at Coinbase and Ripple said progress was made as one of the White House’s crypto advisers urged a trade-off to let third parties, such as exchanges, offer stablecoin rewards only on transaction activity, not balances.

“We rolled up our sleeves and went through specific language today,” Ripple’s chief legal officer, Stuart Alderoty, posted to X on Thursday. Coinbase’s legal head, Paul Grewal, said the meeting was “constructive and the tone cooperative.”

Blockchain Association CEO Summer Mersinger said the meeting was a “step forward” in resolving issues related to stablecoin rewards and ensuring that crypto market structure legislation is advanced.

Source: Blockchain Association

It's the third meeting between the three parties, who first met on Feb. 2 and again eight days later on Feb. 10, as the Senate is looking to pass a bill to define how US market regulators will police crypto.

The House passed a similar version of the bill, called the CLARITY Act, in July, but the effort has stalled as the Senate Banking Committee has not yet secured enough bipartisan support to move it forward.

Semafor reporter Eleanor Mueller and journalist Eleanor Terrett both reported that White House crypto adviser Patrick Witt reportedly drove the discussion at the latest meeting.

Witt pushed for a previously pitched proposal that would allow third parties to offer stablecoin rewards to customers tied to transactions and activity, and not balances, the latter of which has been a sticking point for banks.

“Earning yield on idle balances, a key crypto industry goal, is effectively off the table,” Terrett said, citing those who attended the meeting. “The debate has narrowed to whether firms can offer rewards linked to certain activities.”

Semafor’s Mueller reported that the banks will start meeting tomorrow to decide whether to agree to the trade-off, and added that discussions would continue in the coming days.

Related: Banks can’t seem to service crypto, even as it goes mainstream 

The Bank Policy Institute, American Bankers Association and Independent Community Bankers of America represented the banking industry, none of which have publicly commented on the latest White House meeting.

Banks fear competitive pressures, not deposit flight risk

Banking groups have argued that stablecoin rewards will compete with and undermine the banking system and lead to bank deposits shifting to stablecoins.

The US Treasury estimated in April that mass stablecoin adoption could trigger $6.6 trillion in deposit outflows from the banking system.

However, according to Terrett, one banking member at the meeting said their concerns stem more from competitive pressures than from deposit flight.

Magazine: South Korea gets rich from crypto… North Korea gets weapons

Shares in Bitdeer Technologies Group took a hit on Thursday after the Bitcoin mining and artificial intelligence infrastructure firm announced a $300 million convertible senior note offering. 

Bitdeer said that it intends to offer a “principal amount” of $300 million in convertible senior notes with an option for purchasers to buy an additional $45 million in a private placement. 

It is the second convertible note offering from the firm, following a $150 million offering in April 2024, which also caused an 18% stock slump. 

Convertible senior notes are a loan that investors can convert into shares of the issuing company’s common stock, and holders of these notes have priority over other debt holders in the event of the company’s bankruptcy. 

The new notes, due to settle in 2032, are senior unsecured obligations with interest paid semiannually, and can be converted to cash, shares, or a combination of both.

Bitdeer intends to use the proceeds for datacenter expansion, AI cloud growth, crypto mining rig development, and for general corporate purposes.

The company is headquartered in Singapore with datacenters in the US, Norway, and Bhutan.

Bitdeer stock tanks 17% on latest offering

Shares in Bitdeer (BTDR) ended trading on Thursday down 17.38% to $7.94 and saw a slight fall in after-hours trading to $7.89.

Company stock is currently down 29% since the beginning of the year and almost 70% since its January 2025 all-time high of around $26.

Bitder fell by 17% on Thursday to its lowest level since April. Source: Google Finance

Related: Strategy to equitize convertible debt over 3-6 years: Saylor

Convertible debt often puts pressure on shares as investors factor in the risk of future dilution, as in the event the stock rises, noteholders may convert their debt into equity, increasing the share count.

Capped call transactions to offset dilution

Bitdeer is also running a concurrent registered direct share offering tied to a plan to repurchase a portion of its existing convertible notes due in 2029.

Bitdeer plans to use “capped call transactions,” which are derivatives used when issuing convertible notes designed to offset some dilution, but that did not prevent its stock from sliding. 

Magazine: Chinese New Year boosts interest, TradFi buying crypto exchanges: Asia Express

Neel Kashkari, the president of the US Federal Reserve Bank of Minneapolis, says that crypto is “utterly useless” in comparison to artificial intelligence and took a swipe at stablecoins, saying they don’t have many uses.

Speaking at the 2026 Midwest Economic Outlook summit on Thursday, Kashkari drew comparisons between AI and crypto, saying the latter “has been around for more than a decade, and it's utterly useless.”

“AI has not been around very long, and people are using it every day,” he added. “This is demonstrating to me that this thing is real and it has real long-term potential for the US economy as opposed to crypto.”

Neel Kashkari (left) speaking at the Midwest Economic Outlook summit on Thursday. Source: YouTube

Kashkari said that the way the crypto industry has framed how stablecoins can be used is “a buzzword salad.”

“I always ask people: What can I do with the stablecoin that I can't do with Venmo today?” he said. “I could send any one of you $5 with Venmo, or PayPal, or Zelle, so what is it that this magical stablecoin can do? Then I get a buzzword salad answer, blah blah blah, tokenized deposits.”

Kashkari took specific aim at the notion of stablecoins being used for remittances, as he highlighted that this mainly serves people outside the US, and argued that its not as cheap as people think. 

Related: SEC leaders seek to clarify how tokenized securities interact with existing regulation

He used the example of his father-in-law, based in the Philippines, arguing that while he could receive stablecoins quickly, he still needs to pay fees to convert them into the local currency to actually transact with them. 

“If everybody in the world uses the same currency or the same payment platform. All these frictions go away. But all these other countries are not going to abandon their own monetary policy [for stablecoins],” he said. 

“When it comes to anything about crypto or stablecoins, ask the most basic questions and don't settle for word salad nonsense answers,” he said.

Magazine: Bitcoin may take 7 years to upgrade to post-quantum: BIP-360 co-author

Illicit entities received around $141 billion via stablecoins in 2025, the highest level observed in the last five years, says blockchain analytics firm TRM Labs.

TRM said in a report released on Tuesday that the increase doesn’t reflect a broader growth in crypto-enabled crime, but does show a “deeper reliance on stablecoins within specific activity types where they offer clear operational advantages.”

Stablecoins have been particularly used in sanctions-linked networks and large-scale money movement services, it said. 

Sanctions-related activity accounted for 86% of all illicit crypto flows in 2025. Of the $141 billion in stablecoin flows, around half, or $72 billion, was linked specifically to the Russian ruble-pegged token A7A5, “whose activity is almost entirely concentrated within sanctions-linked ecosystems,” TRM said.

Russian-linked networks, such as one called A7, intersect with other state-linked ecosystems, including entities tied to China, Iran, North Korea, and Venezuela, “underscoring how stablecoins have become a connective infrastructure for sanctioned actors seeking to move value outside traditional financial controls,” TRM stated. 

Sanctions evasion makes up the majority of illicit stablecoin use. Source: TRM Labs

Guarantee marketplaces exclusively on stablecoins

Comparatively, scams, ransomware, and hacking activity make more selective use of stablecoins, often favoring Bitcoin (BTC) or other crypto assets before using stablecoins later in the laundering process.

The report also noted that categories such as illicit goods and services and human trafficking showed “near-total stablecoin usage,” suggesting these markets “prioritize payment certainty and liquidity over price appreciation.”

Volume on guarantee marketplaces like Huione surged to over $17 billion by late 2025, predominantly in stablecoins. 

“The fact that roughly 99% of this volume is denominated in stablecoins reinforces the role these services play as laundering infrastructure, not speculative venues,” they stated. 

Related: Crypto launderers are turning away from centralized exchanges: Chainalysis

Chainalysis reported earlier in February that crypto flows to suspected human trafficking networks increased 85% year over year in 2025. International escort services and prostitution networks operated almost exclusively using stablecoins, they noted. 

TRM Labs reported that total stablecoin activity exceeded $1 trillion in monthly transaction volume multiple times in 2025.

Approximating this over a year equates to around $12 trillion, meaning that illicit use accounts for around 1% of the total. 

Compared with the United Nations estimate, the amount of illicit money laundered globally in one year is 2% to 5% of global GDP, or around $800 billion to $2 trillion.

Magazine: Chinese New Year boosts interest, TradFi buying crypto exchanges: Asia Express

Bitcoin’s recent sell-off isn’t because of quantum computing fear, because if that were the case, Ether would be soaring, says Bitcoin developer Matt Carallo.

“I strongly disagree with the characterization that Bitcoin's current price is materially, because of some kind of quantum risk,” Carallo told journalist Laura Shin on the Unchained podcast on Thursday.

“If that were true, then Ethereum would be up substantially on Bitcoin,” he added. Ether (ETH) is down 58% since a major crypto market crash in early October, trading at $1,957 at the time of publication.

Carallo’s comments come as several Bitcoiners have argued that fears of quantum computing affecting the blockchain is partly why Bitcoin (BTC) has dropped 46% from its October all-time high of $126,100 to now trade at $67,162, according to CoinMarketCap.

Matt Carallo (right) speaking to Laura Shin (left) on the Unchained podcast. Source: YouTube

Ethereum zones in on quantum readiness

Some Bitcoin users have accused the blockchain’s developers of not moving quickly enough to make the network quantum-resistant, while the Ethereum Foundation has said it is taking measures to be ready. 

In its protocol update on Wednesday, the Ethereum Foundation outlined long-term post-quantum readiness as part of its broader security initiative.

Carallo said that although quantum computing poses long-term risks to Bitcoin, market makers don’t see it as a pressing short-term threat, arguing that the Bitcoin community is just looking for a scapegoat.

“There are a lot of Bitcoiners who want to blame something, blame someone for lackluster performance.”

Carallo said that a more likely reason for Bitcoin’s price decline is that it is now “competing for capital” in a way it never has before against other technologies such as artificial intelligence.

“AI is super capital-intensive,” he said, adding that it is a “massive new investment class that is substantially competing for capital.”

“There's a lot of interest in value accrual that will happen because of AI in traditional equities,” Carallo said. 

Bitcoiners are of the opposite opinion

Not all Bitcoiners agree with Carallo, as Capriole Investments founder Charles Edwards said at Cointelegraph’s LONGITUDE event on Feb. 12, that the risk should be priced into Bitcoin until it becomes quantum-resistant.

“Today, you kind of have to start to discount the value of Bitcoin based on that risk until it’s solved,” Edwards said.

Related: Bitcoin bottom signal that preceded 1,900% rally flashes again

Meanwhile, entrepreneur Kevin O’Leary told Magazine in December that using quantum computing to crack Bitcoin may not be the most efficient use of the resources, and there is more upside in using the technology for areas such as medical research.

In May 2025, the world’s largest asset manager, BlackRock, updated the registration statement for its iShares Bitcoin ETF (IBIT) to warn investors of the potential risks to the integrity of the Bitcoin network posed by quantum computing.

Magazine: Bitcoin may take 7 years to upgrade to post-quantum: BIP-360 co-author

The high costs of deploying and running artificial intelligence agents in the workforce may prevent them from replacing humans who can do the same work at lower cost, say two multimillionaire tech investors.

Tech investor Jason Calacanis said on the All-In podcast on Saturday that he has been paying $300 per day for an Anthropic Claude AI agent to help run his businesses, despite the bot only operating at 10% to 20% of full capacity.

“When do tokens outpace the salary of the employee?” Calacanis questioned, referring to the usage allowance, called tokens, that users must purchase to use most AI models.

Social Capital CEO Chamath Palihapitiya said he had the same problem and that the cost of the models means they “need to be at least two times as productive as another employee.” He added he may need to set a budget on how much AI his business can use.

What Happens When AI Tokens Cost More Than Your Employees?@Jason:

“We, with our agents, hit $300/day per agent using the Claude API, like instantly. And that was doing, maybe, 10 or 20%. That's $100k/year per agent.”@chamath:

“We're getting to a place where we have to… pic.twitter.com/5N0rteNFts

— The All-In Podcast (@theallinpod) February 18, 2026

Tech investor Mark Cuban said on Thursday that the high cost of AI adoption in the workforce raised by Calacanis and Palihapitiya was the smartest counter-argument he’d seen to AI taking over jobs.

Cuban said that with the cost of tokens and maintenance, it could cost twice as much for eight Claude AI agents “to do what an employee does per day” for $1,200.

He questioned whether the AI bots were more than twice as productive as a human. or if there were “qualitative issues like morale, morality […] that can’t be quantified, that need to go into the decision.”

The threat of AI replacing large swathes of the workforce has caused uncertainty in recent years, as some companies have initiated layoffs, pointing to their use of AI making some jobs obsolete.

A research paper from Microsoft in July found that knowledge-based occupations, along with customer service and sales roles, were most at risk of being replaced by AI.

Related: China’s AI lead will shape crypto’s future 

White House AI and crypto czar David Sacks is one of many who claim such fears are overhyped, saying in August that AI still needs to be prompted and verified to “drive business value.”

However, others, such as business consulting firm McKinsey & Co, have highlighted that the point of these AI agents is to automate tasks end-to-end, operating without constant human input.

Stablecoins could be agentic AI’s native currency

The use of AI agents has grown in popularity among crypto users, and stablecoin issuer Circle CEO Jeremy Allaire predicted last month that billions of AI agents will be transacting with stablecoins for everyday payments on behalf of users within five years.

Binance co-founder Changpeng Zhao said in January that crypto would end up being the native currency for AI agents due to blockchain being the “most native technology interface for AI agents.”

AI agents are already operating on several blockchains, such as Ethereum Layer 2 Base, where AIXBT, via the Virtuals Protocol, makes micropayments and facilitates trades on behalf of users, while ASI Alliance on Fetch.ai can manage assets and coordinate other economic tasks for users.

On Wednesday, OpenAI launched a new benchmark evaluating how well different AI models detect, patch, and even exploit security vulnerabilities found in smart contracts.

OpenAI said the research was useful as it is becoming more important to evaluate their performance in “economically meaningful environments.”

“Smart contracts secure billions of dollars in assets, and AI agents are likely to be transformative for both attackers and defenders,” it said.

Magazine: IronClaw rivals OpenClaw, Olas launches bots for Polymarket — AI Eye

Key takeaways:

Professional traders are paying a 13% premium for downside protection as Bitcoin struggles to maintain support above $66,000.

While stocks and gold remain strong, $910 million in Bitcoin ETF outflows suggest that institutional investor caution is rising.

Bitcoin (BTC) price entered a downward spiral after rejecting near $71,000 on Sunday. Despite successfully defending the $66,000 level throughout the week, options markets reflect growing fear as professional traders avoid downside price exposure. 

Even with relative strength in the stock market and gold prices, traders seem to be effectively betting on a $60,000 retest rather than overreacting to Bitcoin price dips.

BTC 2-month options delta skew (put-call) at Deribit. Source: laevitas.ch

Bitcoin put (sell) options traded at a 13% premium relative to call (buy) instruments on Thursday. Under neutral conditions, the delta skew metric typically ranges between -6% and +6%, indicating balanced demand for upside and downside strategies. The fact that these levels have been sustained over the past four weeks shows that professional sentiment is leaning heavily toward caution.

Top BTC options strategies at Derbit past 48h, USD. Source: Laevitas.ch

This bearish bias is clear in the neutral-to-bearish positioning seen in Bitcoin options. According to Laevitas data, the bear diagonal spread, short straddle and short risk reversal were the most traded strategies on the Deribit exchange over the past 48 hours.

The first lowers the cost of the bearish bet because the short-term option loses value faster, while the second maximizes profit if Bitcoin price barely moves. The short risk reversal, on the other hand, generates profit from a downward move with little to no upfront cost, but it carries unlimited risk if the price spikes.

Weak institutional demand for Bitcoin ETFs fuels discontent

To better gauge the risk appetite of traders, analysts often look at stablecoin demand in China. When investors rush to exit the cryptocurrency market, this indicator usually drops below parity.

USD stablecoin premium/discount relative to USD/CNY rate. Source: OKX

Under neutral conditions, stablecoins should trade at a 0.5% to 1% premium relative to the US dollar/Yuan exchange rate. This premium compensates for the high costs of traditional FX conversion, remittance fees, and the regulatory friction caused by China's capital controls. The current 0.2% discount suggests moderate outflows, though this is an improvement from the 1.4% discount seen on Monday.

Part of the current discontent among traders can be explained by the lackluster flows in Bitcoin exchange-traded funds (ETFs), which serve as a proxy for institutional demand. 

Related: Bitcoin ETFs still sit on $53B in net inflows despite recent outflows–Bloomberg

US-listed Bitcoin ETFs daily net flows, USD. Source: Farside Investors

US-listed Bitcoin ETFs have seen $910 million in total outflows since Feb. 11, which likely caught bulls off balance—especially as Bitcoin traded 47% below its all-time high while gold prices hovered near $5,000, up 15% in just two months. Similarly, the S&P 500 index sat only 2% below its own all-time high, indicating that this risk-aversion is largely restricted to the cryptocurrency sector.

While Bitcoin options signal a fear of further downside, traders are likely staying extremely cautious until a clear rationale for the crash to $60,200 on Feb. 6 finally emerges.

Kraken’s tokenized equities platform, xStocks, has surpassed $25 billion in total transaction volume less than eight months after launch, underscoring accelerating adoption as tokenization gains traction among mainstream investors.

Kraken disclosed Thursday that the $25 billion figure includes trading across centralized exchanges and decentralized exchanges, as well as minting and redemption activity. The milestone represents a 150% increase since November, when xStocks first crossed $10 billion in cumulative transaction volume.

The xStocks tokens are issued by Backed Finance, a regulated asset provider that creates 1:1 backed tokenized representations of publicly traded equities and exchange-traded funds. Kraken serves as a primary distribution and trading venue, while Backed is responsible for structuring and issuing the tokenized instruments.

When xStocks debuted in 2025, it offered more than 60 tokenized equities, including shares tied to major US technology companies like Amazon, Meta Platforms, Nvidia and Tesla.

Source: xStocks

Kraken said onchain activity has been a key growth driver since launch, with xStocks generating $3.5 billion in onchain trading volume and surpassing 80,000 unique onchain holders.

Unlike trading that occurs solely within centralized exchanges’ internal order books, onchain activity takes place directly on public blockchains, where transactions are transparent and wallets can self-custody assets. 

Growing onchain participation suggests users are not only trading tokenized equities but also integrating them into broader decentralized finance (DeFi) ecosystems.

Kraken said that eight of the 11 largest tokenized equities by unique holder count are now part of the xStocks ecosystem, signaling increased market share in the emerging tokenized equities sector.

Related: Kraken launches tokenized securities trading in Europe with xStocks

Tokenized stocks mirror stablecoins’ early growth

Tokenization of real-world assets (RWAs) remains one of the fastest-growing segments of the digital asset market, even as broader crypto prices have trended lower since the start of the year. 

Tokenized RWAs have increased 13.5% in total value over the last 30 days, according to industry data. By comparison, the broader crypto market shed roughly $1 trillion in market value over the same period. 

Market observers say tokenized stocks may be experiencing their own “stablecoin moment,” a reference to the rapid early adoption that propelled dollar-pegged digital assets into mainstream use. 

Data from Token Terminal shows tokenized stocks reached a market capitalization of $1.2 billion in December, after being virtually nonexistent six months earlier.

The market cap of tokenized stocks has grown considerably since September of last year. Source: Token Terminal

Related: Crypto’s 2026 investment playbook: Bitcoin, stablecoin infrastructure, tokenized assets