Cryptopolitan

Developers are now using AI agents to protect smart contracts that control billions in digital assets, following crypto hackers’ theft of over $3.4 billion from blockchain platforms in 2025. 

Rather than dozens of small thefts, 2025’s losses were concentrated in a few massive breaches, with just three major incidents accounting for nearly 70 % of the total value stolen. The most notable was the Bybit exchange hack, which alone siphoned off roughly $1.4 billion — one of the largest crypto thefts ever recorded

OpenAI is working with Paradigm and OtterSec to test whether AI agents can detect vulnerabilities in real blockchain spaces using its EVMbench.

AI agents review smart contracts to identify and fix security issues that lead to crypto losses

Any error in smart contract code today will affect real money belonging to big and small investors, as these automated programs manage more than $100 billion in open-source digital assets. 

And after hackers stole over $3.4 billion from crypto platforms in 2025, developers can now see just how vulnerable the system is when attackers exploit weak code. 

Relying on human audits isn’t an option anymore because live contracts face new and evolving attacks that weren’t present during the audit process. Plus, it takes a lot of time and costs a fortune as security teams must review smart contract code before deployment.

Instead of waiting for the next manual audit cycle that may come too late to stop an attack, developers are now turning to AI agents to continuously monitor live smart contracts.

It takes AI agents less time to detect hidden code irregularities than people do, who may need days or even weeks, so frameworks like the EVMbench by OpenAI make more sense for developers.

EVMbench uses AI agents in test environments to help developers understand how smart contracts may perform under real-world pressure before the actual deployment.

The agents will first detect hidden vulnerabilities in code, fix the issue without breaking the contract’s function, and then try to exploit the weakness to drain funds if the problem persists.

According to early results, AI agents are better at exploiting vulnerabilities than safely fixing them. People are now concerned that hackers could misuse AI-powered tools to exploit weaknesses in blockchain systems more efficiently than ever. 

AI agents can also create new security risks by helping hackers identify weaknesses in blockchain systems

Machines are learning to break into weak contracts faster than ever before because current AI agent systems now succeed in exploiting more than 70% of vulnerabilities compared to earlier AI models with a less than 20% success rate.

Attackers are now moving away from manual hacking methods and toward AI agents that scan large amounts of code and test different attack paths without direct human input.

And as this trend continues, experts now say AI agents will soon be able to move funds, approve transactions, and manage financial tasks automatically on behalf of users. 

American technologist Jeremy Allaire said that billions of AI agents will soon use stablecoins to send and receive payments across blockchain networks. Founder and former CEO of Binance, Changpeng Zhao (CZ), also said crypto could become the native payment layer for AI-driven systems in the future.

All these trends and predictions make AI agents more useful to both users and attackers, as they will soon interact with contracts directly in real financial environments where actual money is at stake.

Industry leaders have even raised concerns about user safety. Managing partner at Dragonfly, Haseeb Qureshi, warned that many users still worry about sending funds to the wrong address or approving a harmful transaction by mistake through crypto transactions.

To solve this problem, Qureshi proposed that AI-operated wallets could soon interact with the blockchain without users needing to understand the complex process involved.

In this way, AI agents can assist in reducing human errors in audits and in protecting smart contracts by continuously monitoring systems. However, they can also increase the rate at which attackers discover vulnerabilities in the system, enabling exploits to scale much faster.

This creates a security issue where AI systems developed to protect decentralized finance platforms could also be the most effective at attacking them if they fall into the wrong hands.

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WLFI is up 20% today because World Liberty Financial has said it plans to tokenize loan revenue tied to the Trump International Hotel & Resort now being built in the Maldives.

Traders reacted fast. The token is now linked to projected resort loan income, and that pushed WLFI higher during a week when the broader crypto market looked mixed.

World Liberty Financial lists President Donald Trump as “co-founder emeritus.” The company said it will tokenize revenue interests from loans connected to the Maldives resort.

Those tokens will fall under its branded real-world asset strategy. The announcement came Wednesday at the World Liberty Forum held at Mar-a-Lago in Palm Beach, Florida.

World Liberty outlines tokenized real-world asset plan

The forum brought out Goldman Sachs CEO David Solomon, Coinbase CEO Brian Armstrong, Eric Trump and Donald Trump Jr. also spoke.

John D’Agostino from Coinbase Institutional spoke about volatility. John said, “There are emotional break points. Uh 100,000 I think was an emotional break point on the upside where a lot of people who’ve been holding it since a,000 bucks 2,000 bucks said okay now I can kind of delever and take some risk off.

“Um I think any handle six handle, five handle, eight handle, nine handle, 10 handle is an emotional break point. uh in terms of the technicals, you know, that varies based on momentum,” John added.

His comments came as investors tried to make sense of price levels across the market while WLFI climbed.

Lawmakers debate stable coin rewards at the forum

Ohio Senator Bernie Moreno spoke at the event. Bernie said the Clarity Act could become law by April. He supports allowing rewards on stable coins. Bernie said, “What it means is that the cash that you hold, you’re going to have competition to pay you more interest. So, you’re going to be able to get more money for the money that you have in your wallet or the money that you have in some sort of account. So, this is very, very good for working Americans because ultimately this is about giving Americans more rewards for being able to have cash. uh on reserve, be able to get paid quicker, be able to transact faster, democratize the financial systems.”

Brian addressed concerns about blocking regulation. Brian said, “One of the big issues that did come up in the past was this idea of stable coins on rewards. Um I wouldn’t say we blocked it. In fact, nobody, I think, in the crypto space has been working harder on this over the last few years to try to get some legislation. Uh, what we did say was the current draft, we had some issues with it. I think that caused everyone to come back to the table.”

Brian then said:-

“And there’s now a path forward where we can get a win-win-win outcome here. Win for the crypto industry, a win for the banks, and a win for the American consumer uh to get President Trump’s crypto agenda through to the finish line uh so we can make America the crypto capital of the world.”

Eric and Donald Jr. also spoke about bringing crypto and traditional finance together. Critics from the Democratic Party have questioned whether the Trump family’s crypto involvement could create conflicts of interest.

The White House said the president’s crypto holdings are held in a trust managed by his children. Eric has dismissed those concerns in prior interviews.

Dragonfly raises $650 million as institutions back crypto

Dragonfly Capital announced it closed a $650 million fourth fund. Backers include JP Morgan and the Rockefeller Foundation. General manager Rob Haddock spoke about raising money during a risk-off period.

Rob said investors want managers who understand traditional market structure, crypto systems, and blockchain technology.

He said 2025 and 2026 could bring faster adoption across payments, stable coins, prediction markets, decentralized finance, and market structure reform.

Dragonfly has focused heavily on stable coins. It invests in issuers like Agora and Athena. It also backs Rain, which settles stable coins directly with Visa 365 days a year.

That channel grew from zero last April to over $4 billion annualized in direct settlement volume. The firm is also looking at tokenization, blockchain infrastructure, decentralized finance, centralized finance, and AI crypto crossover.

Gemini announced executive exits, including its COO, CFO, and CLO, after cutting roughly 25% of staff. The company said it will stop operating in the UK, EU, and Australia to focus on the United States. Galaxy shares have fallen about 22% month to date.

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Riot, a Bitcoin mining and digital infrastructure firm, soared 6% after activist investor Starboard Value called on the company in a letter to accelerate deal-making in artificial intelligence (AI) and high-performance computing (HPC). 

In this letter, Starboard Value noted that the mining firm could generate equity value of $9 billion to $21 billion through Texas-based AI and HPC data centers. Nonetheless, to achieve this significant milestone, the activist investor stressed the need for the company to embrace time as an important tool and to complete more crucial deals during this period, when Riot will intensify its focus on AI and HPC. 

Moreover, Starboard emphasized that, “With 1.4 gigawatts of gross capacity still available to be utilized, Riot has a great opportunity – but it needs to act with excellence and urgency.” They made these remarks while expressing optimism that “Riot could attract high-quality tenants for tier-3 data centers with terms similar or better than those announced by competitors towards the end of 2025.”

Starboard argues that Riot is well-positioned to meet rising demand for AI and HPC

Starboard Value’s letter to Riot executives mirrors a substantial shift among cryptocurrency miners, who are deploying significant computing power toward AI. More precisely, reports stated that this step corresponds to volatility in bitcoin mining profitability and exponential growth in demand for AI data centers.

These findings prompted Starboard to write a letter to Riot Platforms CEO Jason Les and Company Executive Chairman Benjamin Yi, with a copy sent to the Company’s Board of Directors, highlighting an increasing trend in the technology sector where players employing AI and high-performance computing (HPC) in their operations perceive crypto miners as very good candidates to scale up their data centers on the go.

The letter also noted that the mining company’s performance has fallen behind that of its rivals, which have executed big AI and HPC deals. To curb this situation, Starboard wrote to Peter Feld, the Managing Member of Starboard, stating that Riot must quickly take advantage of a great opportunity presented by rapidly surging AI and HPC demand in this fast-evolving environment.

This situation triggered reporters to reach out to Riot for comments. However, the company declined to respond. When they requested that Starboard comment on the matter, the activist investor argued that Riot is well-positioned to meet rising demand, citing its key Texas facilities in Rockdale and Corsicana. At this point, it is worth noting that Starboard possesses around 12.7 million shares in the Bitcoin mining and digital infrastructure firm.

Meanwhile, analysts found that these facilities, when combined, could supply approximately 1.7 gigawatts of power to support AI data center operations.

On the other hand, after noting down its observation and thought regarding the mining company’s focus on AI and HPC, Starboard, which claims to be a significant stockholder in the company, spoke highly of the Bitcoin mining and digital infrastructure firm’s latest deal with Advanced Micro Devices (AMD), a leading global semiconductor company. According to the activist investor, this agreement demonstrated a positive sign of Riot’s progress. However, they termed it a minor proof-of-concept deal.

Riot-AMD deal marks a significant accomplishment in the industry 

When reporters reached out to Riot to comment on its deal with AMD, the firm noted the agreement as a major one, anticipated to generate about $311 million in revenue over the first decade. Moreover, Riot stated that this deal is set to record approximately 80% EBITDA margins.

Les said the partnership with AMD positions Rockdale as a leading data center development opportunity and positions Riot for substantial long-term value creation.

Les also stated, “This partnership represents a validation of Riot’s infrastructure, development capabilities, the attractiveness of our sites, our readily available power capacity, and our ability to offer innovative solutions to meet the requirements of top-tier tenants.”

Starboard had projected that a Bitcoin mining and digital infrastructure company could potentially yield over $1.6 billion in annual EBITDA, assuming its power capacity monetization meets industry standards.

In the meantime, to stay competitive in the industry, companies like CleanSpark, MARA Holdings, Core Scientific, Hut 8, and TeraWulf have followed Riot’s led, illustrating heightened interest in AI and HPC.

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Coinbase will give Base more direct control over the main software that runs the network. Base, one of the largest Ethereum scaling solutions incubated by crypto exchange Coinbase, said it will transition away from Optimism’s core technology and adopt a new “unified Base stack” that consolidates previously distributed components. This includes the network’s sequencer and other infrastructure into a single Base-managed codebase.

According to the Base team, the network plans to increase its rate of protocol upgrades to as many as 6 hard forks per year, roughly double the rate under the Optimism-based setup.

Coinbase is moving Base to run on its own software system instead of relying on external technology.

Coinbase grew quickly in its early stages and provided developers with a stable platform to build apps by launching Base on the OP Stack, enabling faster scaling on ETH without starting from scratch.

As time went on, Base had to improve its performance, speed, and developer experience, so it began adding more tools and features from external teams such as Flashbots and Paradigm. 

In the end, upgrades and maintenance depended on teams working across separate software layers, making the system harder to manage. The network had to wait for shared release cycles before releasing major upgrades, such as hard forks, due to greater coordination with external partners.

Coinbase now wants Base to package its own software upgrades, release one official binary for node operators to run, and manage its future hard fork schedule without Optimism. To achieve this, the company will put all its external software parts into a single in-house system called base/base. 

Node operators who want to remain compatible with the network but still run Optimism-maintained clients will have to switch to Base-maintained clients. 

This ultimatum for operators shows just how serious Coinbase is about Base running and managing its own tech stack while still building on Ethereum. 

Base can now make faster upgrades by controlling its own technology system.

Coinbase wants Base to move at its own pace, so the network will handle six minor hard forks annually instead of the usual three. 

With this faster schedule, the team will be able to test new scaling features sooner and use multi-proof systems to release faster withdrawals. Base will also be able to confirm transactions more quickly using more advanced TEE and zero-knowledge (ZK) proofs.

While the company wants to give Base full control over how the network runs, it still wants to retain essential support from Optimism Enterprise during the transition. So, Coinbase will introduce Base-specific governance, independent security council signers, Base-level fee systems, and enhanced neutrality standards across the stack.

This will allow Base to upgrade, govern, and decentralize on its own software foundation over time.

Optimism now has less influence over Base because it has lost one of the network’s largest ecosystem partners. Base can finally act more quickly and independently because it has taken control of its upgrade cycle.

Investors reacted quickly when they realized that one of Optimism’s key Layer 2 partners was taking its own path, which led to a drop in the OP token. And if Base continues down this road, the weight of competition will force Optimism to advance its own network and its governance decisions. 

Developers on the network won’t have to wait months for network-wide changes to test new scaling methods, advanced cryptography systems, or faster withdrawals. It will also be easier for them to create reliable, innovative products because they can plan their applications around Base’s independent upgrade schedule. 

Users and end customers will also enjoy quicker and more secure transactions because multi-proof withdrawals will reduce wait times.

With this new flexibility, Base will be able to test new ways to reward node operators, developers, and users without waiting for Optimism. These experiments will attract more activity to the network’s ecosystem because Base will become more competitive compared to other Layer 2 networks. 

Base will soon be a major player in Ethereum scaling because the network now has the tools to innovate faster, govern itself, and respond to real-world delays, all while getting support from optimism in critical areas. 

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The entire crypto community spent months wondering why Bitcoin crashed in October last year. As such, everyone eagerly waited for major institutional investment managers to file their quarterly 13F reports with the SEC so they could reveal which funds were buying or selling Bitcoin ETFs around the time of the crash. 

But the answers they got might not be the answers they wanted.

From the last filings due on Valentine’s Day and formally reported yesterday due to Monday’s Presidents’ Day holiday, the spotlight immediately fell on Laurore LTD, a relatively unknown Hong Kong-based entity that showed up in BlackRock’s iShares Bitcoin Trust (IBIT) holder list with 8.79 million shares (around $436 million). 

It was Bitwise advisor Jeff Park, who flagged the filing yesterday, February 17, describing Laurore as “the biggest new entrant into IBIT” from “a brand new entity with no website. No press. No footprint.” 

The news triggered immediate speculation: was this mystery fund the hammer that smashed Bitcoin from $127,000 to $102,000 in 40 minutes back in October last year?

Q4 holdings show Laurore built its position after the crash

DeFi Development Corporation CIO, Parker White, noted that Laurore’s IBIT stake was built during the fourth quarter of 2025, which began on October 1 and ended December 31. 

However, Parker did observe that major options market makers “MASSIVELY increased their long vol exposure to IBIT via both CALL and PUT buying,” according to yesterday’s Q4 13F filings. 

In his post, Parker mentioned what he thought were “comical” position size increases by Jane Street, SIG, IMC, Citadel, and Marex, some of the largest options market makers in the world.

“690% increase in calls from JPM (likely tied to their structured product offerings), 102% increase from Barclays, etc.” Parker mentioned. 

The DeFi Development Corporation claimed that someone is massively short on the other side of these “massive CALL and PUT buying by the dealers.” 13F filings currently do not require funds to report short positions in options, only long positions. 

Parker ended the post not completely exonerating Laurore: “So then, with this much positioning, if the short positioning was concentrated with just a few funds (or maybe a single HK-based fund as I’ve predicted), then a blow up is completely inevitable.”

However, in a later post on the same day, Parker admitted: “I kinda don’t think they are the HK fund that blew up, but nonetheless, interesting,” referring to Laurore.

Chinese capital could be rerouting funds to US ETFs 

Park’s analysis focused more on finding out information about Laurore than the cause of the crash, though. He observed that the filer’s name was Zhang Hui, which he described as the “Chinese equivalent of John Smith”, a name so common it also serves as camouflage, thus drawing more raised eyebrows.

From the SEC filings, Laurore listed its address as Suites 2907-8, 29F, Two Exchange Square, 8 Connaught Place, Central, Hong Kong. This is one of the city’s most prestigious financial districts. 

Park also noted that the Ltd suffix potentially indicates a Cayman Islands or British Virgin Islands shell structure commonly used by wealthy users or institutions with restricted capital to access US securities markets.

Based on the similarities in the signatory name and address, Parker White believes that Laurore might be a subsidiary of Hao Advisors Management, although with some skepticism. He also claimed that the setup was done professionally, so it could not have been an amateur operation.

What makes Laurore interesting, however, is the capital flow associated with it. Since Chinese citizens cannot legally hold Bitcoin directly, Park suggested that the filing could represent “an early sign of institutional Chinese capital moving into Bitcoin through a regulated US ETF rather than through exchanges or gray-market channels.”

The theory makes sense since IBIT offers institutional-grade Bitcoin exposure with BlackRock’s $10 trillion valuation, full SEC oversight, and huge liquidity. This means a Cayman Islands-based organization holding IBIT shares through a Hong Kong address can still maintain plausible deniability.

13F filings rule out institutional conspiracy

The Valentine’s Day filing deadline failed to produce concrete evidence tying institutional players to the October incident. 

Nonetheless, Park’s main point about transparency is still true. Since registered investment advisors managing over $100 million are mandated to disclose all equity holdings per quarter, offshore entities like Laurore that choose US ETF exposure have to voluntarily subject themselves to the public scrutiny that comes with the territory.

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The Hyper Foundation has invested 1 million of its HYPE tokens into the creation of the Hyperliquid Policy Center. The center will focus on making sure that issues in the decentralized finance sector do not go unaddressed in the current crypto policy environment. 

The Hyperliquid policy center will be an independent nonprofit focused on advocating for updated decentralized finance policies that match current realities.

The Hyper Foundation commits almost $30 million to DeFi policy push

The Hyper Foundation has announced that it has committed 1 million HYPE tokens to fund the creation of the Hyperliquid Policy Center (HPC). Based on the current market price, this grant is worth nearly $30 million. The tokens are set to be unstaked later today.

The Hyperliquid Policy Center is an independent research and advocacy nonprofit that ensures that decentralized finance, or DeFi, has a clear and legal path to grow in the USA.

Jake Chervinsky will come on board as the founding CEO of the organization. Chervinsky is a well-known figure in the crypto legal world who previously served as the Chief Legal Officer at the venture firm Variant and held a senior leadership role at the Blockchain Association.

Last month, Hyperliquid processed over $256 billion in perpetual futures volume, but despite its massive growth, many of the products offered by the company, such as perpetual derivatives, currently operate offshore because U.S. financial laws were written for traditional, centralized systems.

Hyperliquid processed $256 billion over the last 30 days. Source: Defillama 

Hyperliquid believes its community needs direct representation in Washington to protect its interests and explain how decentralized markets actually work.

HYPE is currently trading at approximately $29.16, down significantly from its peak of $59.39 in late 2025.

In collaboration with Policy Counsel Brad Bourque, formerly of the law firm Sullivan & Cromwell LLP, and Policy Director Salah Ghazzal, who was previously the policy lead at Variant, the company hopes to provide expert support and technical research that will lead to the creation and implementation of modern rules.

The center is also actively hiring for several high-level roles, including a Chief of Staff, a Head of Communications, and a Head of Government Relations.

How can the HPC impact DeFi regulation?

To better establish a legal framework for on-chain perpetual contracts and properly close the gap between how these products are used globally and how they are viewed by U.S. regulators like the SEC and CFTC, the center will publish research that explains why decentralized protocols are different from traditional exchanges and how they can be regulated without destroying their unique benefits.

In 2025, crypto policy progressed significantly with the GENIUS Act, which focused on stablecoin regulation, becoming law in July. The CLARITY Act has stalled in Congress after months of significant progress. The HPC aims to build on this momentum to ensure that DeFi-specific issues are addressed.

Other groups, like the Blockchain Association, are making efforts to work with the current administration and Congress.

Former CFTC Commissioner Summer Mersinger took over as The Blockchain Association’s CEO. The company held a major policy summit in December 2025, which saw record attendance from both industry leaders and bipartisan members of Congress. They have been focused on challenging restrictive IRS reporting rules and pushing for a comprehensive market structure bill.

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Altcoin selling pressure reached an all-time high, as those assets suffered even deeper losses compared to BTC. Even worse, recovery may be months or years away, as there are rarely any signs of investors buying the dip. 

Altcoins are under overwhelming selling pressure, with no signs of buyers. The buy/sell quote volume ratio signals that selling is at an all-time peak, accelerating in the past weeks. 

Altcoin selling pressure increased exponentially, passing even the worst selling during the 2022-2023 crypto winter. | Source: Cryptoquant

While altcoins have offered relief rallies during previous market downturns, their higher volatility erased any real demand. 

Altcoins have historically sold off during BTC bear markets, but in 2026, the pace of selling is at its steepest, marking unprecedented records. 

The recent bear market may also cause the disappearance of another wave of projects, similar to other dead chains and coins. Even blue-chip tokens are seeing a sell-off, with only ETH showing signs of silent accumulation. 

Why are altcoin prices failing? 

Altcoins and tokens belong to projects that have had years to prove their utility. While some networks had success, others carried a minimal number of transactions. Despite the hype, those networks never carried an on-chain economy. 

Altcoin seasons were extremely brief, ending within days. Even the concept of blue-chip altcoins suffered, as most assets crashed deeply following the October 10 liquidation event. 

The altcoin season index stagnated around 30 points, only due to the underperformance of BTC. Most altcoins have erased the gains from their local peaks, and are unwinding in both dollar terms and against BTC. 

Altcoin liquidity spread to memes

Liquidity flowed to altcoins in expectation of eventual pumps. During previous cycles, even bearish altcoins outperformed. 

This time around, liquidity has spread to a much wider selection of tokens. The previous altcoin pumps were also unpredictable and required traders to wait for months. 

Meme tokens can deliver short-term rallies and do not require traders to lock funds for the long term. Some of the speculative and retail funds for altcoins moved back to the meme trenches. Other traders moved back to DEX swaps, as centralized exchanges carried a more limited selection of altcoins. 

Altcoin derivative trading also slowed down on centralized markets due to the more significant risk of liquidations. Some of the activity switched to perpetual futures DEXs. 

Additionally, some of the altcoin capital reverted to BTC, while others parked their gains in stablecoins and switched to DeFi for passive income.

Altcoin trading volumes also declined more rapidly during periods of corrections. In November, altcoins made up over 59% of Binance trading activity. By February, the share of altcoins had fallen to 33.6%, an almost 50% drop. 

The share of altcoin trading on Binance shrank in the past months, down to 33.6% of total volumes. | Source: Cryptoquant

The big question is whether there may be another altcoin market. For some, altcoins entered a bear market in 2022 and never really recovered. Only a handful of top assets with full DeFi ecosystems survived the previous crypto winter and remained as relevant projects. 

The recent volume shift showed BTC was seen as safer during periods of uncertainty and market stress. Аnother destination for available liquidity is the RWA markets, where tokenized metals replace some of the hot altcoins. 

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After recently legalizing crypto banks, Belarus is now promising its citizens an array of services that should let them earn, stake and spend cryptocurrencies like Bitcoin.

A top central bank executive spoke in detail about the coin-based products that may hit the market as early as this year, with the nation awaiting the birth of its first crypto banking institution in 2026.

Belarusian crypto banks to issue cards and loans backed by Bitcoin

Belarusians may soon be able to pay with cryptocurrency in brick-and-mortar stores and borrow fiat money using their digital assets as collateral.

That’s according to Alexander Egorov, first deputy chairman of the National Bank (NBRB), who pulled the curtain on some of the crypto banking services his compatriots may expect in the coming months.

Speaking to the government-run First Information Channel, the central bank official emphasized that Belarus is the world’s first country to officially introduce crypto banks to its national financial system.

If not a global leader in that respect, Belarus certainly became the first country in its region to legalize the operations of such institutions last month. It did that via a special decree signed by its long-term president, Alexander Lukashenko.

Unlike Switzerland or the U.S., where crypto banks are private entities under regulatory approval, Belarus is establishing a comprehensive crypto banking system under state control, explained Egorov.

This system should offer “tangible services” for everyone, the official BelTA news agency relayed his statements, noting that the first Belarusian crypto bank may open in 2026.

The deputy governor gave an example with crypto-secured loans, which offer crypto investors an opportunity to use fiat credit while preserving their digital-asset investment:

“Imagine this – you have Bitcoin, which is rising in value … You deposit the coins into a crypto bank as collateral. The bank issues you regular rubles. You use the money, repay the loan, and the bank returns your crypto.”

He also mentioned staking, calling it a next-gen depositing that will allow crypto owners to earn passive income while supporting blockchains and getting rewarded for keeping their coins with a bank.

Crypto cards are coming to Belarus, too, and Egorov described them as the most understandable and long-awaited product in the sector.

“It’s a regular bank card linked to your crypto bank account. You go to a store and pay for groceries. At the moment of payment, the bank instantly converts part of your cryptocurrency into Belarusian rubles,” he told the national broadcaster.

Self-employed Belarusians to legally earn cryptocurrency

A change that will affect hundreds of thousands of people in Belarus is the legalization of crypto remuneration for self-employed individuals.

“When previously, a designer or programmer completed an order for a foreign client who offered to pay with crypto … they couldn’t legally deposit the funds into their account and pay taxes. Now this barrier has been removed,” Egorov pointed out, also quoted by Sputnik Belarus.

The only legal requirement in such cases will be to channel these transactions through a licensed Belarusian crypto bank, the NBRB executive noted.

The banker is convinced that the model adopted by Belarus will eliminate risks that have ruined some foreign platforms, in his words.

The security of the banking services providers will be checked by specialists from the High-Tech Park (HTP) in Minsk, while the monetary authority will conduct traditional financial oversight.

The cryptocurrency banks themselves will verify clients and “X-ray” every transaction, Alexander Egorov added, stressing in conclusion:

“This is a bold step that transforms the theoretical potential of blockchain into real economic benefits for every citizen and business.”

Belarus, Russia’s closest ally, has seen a spike in crypto-related transactions over the past few years, amid Western sanctions limiting its residents’ access to fiat channels. The increase prompted Lukashenko to acknowledge the growing importance of crypto payments last fall.

The country has long established itself as a leader in cryptocurrency regulation in the post-Soviet space, after introducing rules for mining and trading “digital tokens” with another of his decrees enforced in 2018.

The Russian Federation has only recently taken the path of regulating such activities.

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The Federal Reserve will inject $16,021,000,000 into the U.S. financial system this week through scheduled bill purchases, adding short-term liquidity that traders see as supportive for stocks.

U.S. equities are grinding higher ahead of the latest Fed meeting minutes, with the S&P 500 up 0.2%, the Nasdaq Composite up 0.2%, and the Dow Jones Industrial Average higher by 86 points.

Nvidia jumped 2% after Meta said it plans to deploy millions of Nvidia chips in new data centers, while Bitcoin remains stuck around $67,000.

In the past month, BTC selling revealed the steepest capitulation since 2022. The Aggregate 30D Realized Cap turned sharply negative, showing the ongoing absorption of real losses. 

The BTC downturn from $90,000 to the $60,000 range was caused by the steepest capitulation since 2022. The market downturn showed multiple sources of selling pressure, coming from ETFs, strategic trader whales, as well as long-term holders.

This time around, the supply of stablecoins has remained flat, with no new minting and inflows of liquidity. 

In early February, signs of a market capitulation were already present, and the selling has only deepened. At the current price range, the question of a local market bottom is still uncertain. Previous deep capitulations could continue for a while before a price reversal. 

For BTC, even a price rally may not be enough to sustain a lasting recovery, as some holders may sell at or near their breakeven levels. 

The ongoing capitulation kept BTC stuck in a range above $67,000, as any attempts to break out above $70,000 led to selling. The capitulation may continue, as predictions see BTC sliding as low as $50,000. 

BTC realized cap declines as selling continues

The BTC realized market cap has been in decline since the October 2025 downturn. The metric is still a lagging indicator, which shifts more slowly. Some of the selling in the past months was still at a relatively high range. 

Currently, only 55% of the BTC supply is held in profit, down from over 99% in October 2025. The longer period of weakening prices has led to a mix of strategic selling, panic, and capitulation. 

The BTC supply in profit fell sharply from 99% in October, down to around 55%, putting pressure even on older wallets. | Source: Cryptoquant

A significant part of the selling may be due to forced liquidations, rather than deliberate shedding of positions. Despite this, some notable whales have started to divest, with ongoing BTC inflows into Binance in the past month. The other major source of price pressure may be a miner capitulation as pools now more actively sell off their rewards. 

The recent selling also keeps the BTC fear and greed index in the “extreme fear” territory at 12 points, with almost no recovery in the past few days. 

Is BTC facing a longer bear market?

The short-term price movements for BTC may include rallies to a higher price range. Sideways trading is also a possibility. 

There is no consensus for the end of the drawdown, and for some, the directionless trading may continue until the end of the year. 

BTC is now down by 45% from its price record, moving with continued losses for 135 days since the peak. Previous price cycles have shown that over 200 days are often spent in sideways trading, while rallies last only a few weeks or even days.

For now, silent accumulation may continue, but selling pressure remains, and a local bottom for BTC is expected at a later stage in the cycle.

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DeFi lending protocol Moonwell lost $1.78 million after an oracle pricing error in what is being described as one of the first major exploits directly linked to AI-generated Solidity code. Apparently, the error was caused by some code that was partially written by Anthropic’s Claude Opus 4.6 model.

Moonwell, a decentralized lending market operating on Base and Optimism, stated that it found a critical oracle configuration issue affecting its Coinbase Wrapped Ether (cbETH) Core Market on Base.

This caused cbETH to be valued at approximately $1.12 per token instead of its actual market price near $2,200, which is a 2,000x undervaluation that triggered instant liquidations.

🚨Claude Opus 4.6 wrote vulnerable code, leading to a smart contract exploit with $1.78M loss

cbETH asset's price was set to $1.12 instead of ~$2,200. The PRs of the project show commits were co-authored by Claude – Is this the first hack of vibe-coded Solidity code? pic.twitter.com/4p78ZZvd67

— pashov (@pashov) February 17, 2026

Claude co-authored code set cbETH price at $1.12 instead of $2,200

The vulnerability appeared on February 15, just after Moonwell activated governance proposal MIP-X43, which integrated Chainlink’s Oracle Extractable Value (OEV) wrapper contracts across Base and Optimism markets.

As such, instead of calculating the cbETH price in USD by multiplying the cbETH/ETH exchange rate by the ETH/USD price feed, the deployed code obtained only the cbETH/ETH exchange rate and treated that ratio as if it were already denominated in dollars.

With cbETH trading at lower prices because of Moonwell’s oracle, liquidators could repay around $1 worth of debt and get collateral worth thousands in return.

Moonwell’s risk manager was able to reduce the cbETH borrow cap to 0.01 within hours of the vulnerability, effectively freezing new borrowing activity and containing further damage.

However, liquidations had already been processed, so users were left with catastrophic losses.

The protocol also estimated total losses at $1.78 million, mostly affecting cbETH, WETH, and USDC positions. Some borrowers nearly lost all their collateral as well, while others exploited the incorrect pricing to borrow even more money than they should have been allowed to, thus creating more debt within the protocol.

Bithumb suffered similar value assignment error just days earlier

The Moonwell incident is very similar to an error made at the South Korean exchange Bithumb just days earlier, on February 6, where a wrong-unit assignment created tens of billions of dollars in ghost value.

Apparently, a Bithumb staff member entered “BTC” instead of “KRW” while distributing rewards for a Random Box promotion, thus rewarding users in Bitcoin instead of Korean won.

The project lost approximately 620,000 Bitcoin worth over $40 billion (nearly 3% of Bitcoin’s entire global supply).

Vibe coding debate intensifies

The Moonwell incident has re-sparked the debate over vibe coding. Advocates argue that AI makes coding more accessible, while critics warn that its code may contain vulnerabilities that human reviews would most likely miss.

Smart contract auditor Pashov emphasized that “behind the AI is a person who checks the finished work, and possibly an auditor. For this reason, blaming the neural network alone is incorrect, although the incident ‘raises concerns’ about vibe coding.”

Source: @pashov via X/Twitter.

Another blockchain security firm, SlowMist, shared its concerns about “oracle formula vulnerability” and the breakdown of human oversight that allowed the flawed code to reach production.

A study published just weeks before the Moonwell incident identified 69 vulnerabilities across 15 applications created using popular AI coding tools, including Cursor, Claude Code, Codes etc.

Even more interesting is that Anthropic’s own research from December 2025 revealed that Claude Opus 4.5 could exploit smart contract vulnerabilities worth $4.6 million by itself (in simulated environment). The research also established that premier AI models can now “independently identify vulnerabilities, create working exploit chains, and extract value with minimal human oversight.”

Nonetheless, Moonwell clarified that “no other markets on Base or OP Mainnet were affected. The issue is isolated to the cbETH Core Market on Base.”

The protocol also noted that this was not its first oracle incident, recalling a misreporting incident in November 2025.

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Tether emphasized that Tether Gold XAUT has risen to the top as the first publicly listed gold firm structure to offer shareholders the option to receive dividends in tokenized gold, marking what it describes as a major breakthrough in the gold industry.

The digital gold sector is currently experiencing explosive interest, with the token’s market capitalization nearing $2.55 billion and leading broader growth in tokenized real-world assets.

Following this announcement, Elemental Royalty Corporation highlighted the connection between tokenized gold ownership and standard royalty payments on the blockchain while assuring investors that they can choose to receive dividends in XAUT rather than cash.

On the other hand, Paolo Ardoino, Tether CEO, stressed that this advancement encourages the use of gold in modern finance via tokenization. Currently, XAUT is trading at $4,907.26, up 0.04% over the past 24 hours, according to CoinMarketCap.

Investors demonstrate interest in XAUT

The new product from Tether is expected to grant investors direct physical gold ownership by allocating funds to gold royalties. Reports expect these firms to pay about 12 cents in dividends to investors through quarterly payments.

The offer was a landmark in the industry because it represented the first time a publicly traded gold company had executed such a strategy. The product comes after Tether gained roughly a 33% stake in Elemental in 2025.

Gold-backed tokens are now the fastest-growing asset class, with the valuation of the overall tokenized gold market exceeding $5 billion.

XAUT plays a key part in this value, securing its position as a leader in this sector in terms of supply and volume. This is because several investors, who want to own gold independently, avoiding reliance on intermediaries or custodians, have illustrated heightened interest in the digital token 

Notably, even with this advancement, investors who prefer cash distributions can still receive dividends in cash. Even so, David Cole, the CEO of Elemental Royalty Corporation, viewed supporting Tether’s offering as a way of securing the firm’s future.

“By offering investors a dividend in Tether Gold, we set Elemental apart as a forward-looking and growth-focused investment,” he said. Meanwhile, despite the innovative move, Elemental’s stock price declined to $19.41, a 7.8% drop.

The company generates income by securing royalty interests in mining projects. According to its executive, this strategy is beneficial because it reduces risks associated with owning and operating mines while keeping opportunities for gain open.

Tether shifts its focus toward XAUT

Tether’s shift towards tokenizing gold, after building a legacy on USD-linked tokens, is tied to the recent surge in gold’s price. The market valuation of XAUT escalated to $2.5 billion from an initial record of  $714 million.

Towards the end of last year, the firm had successfully established about 375,000 XAUT. A report from accounting firm BDO Italia showed that this figure rose by 38% from three months earlier. On the other hand, data from CoinGecko showed that the market capitalization of USDT rose to an all-time high of $187 billion, a 7% increase.

These figures represent that XAUT’s total supply increased fivefold compared to USDT’s in the last quarter, suggesting that investors now prefer gold-backed assets.

Responding to this market behavior, Ardoino mentioned that, “XAUT was created to remove uncertainty during a time when trust in financial systems is declining.” Afterwards, he expressed concern over mounting government debt and continued inflationary pressures 

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Nvidia is deepening its roots in India, announcing a sweeping set of deals with cloud providers, venture capital firms, research institutions, and AI startups as the country positions itself as a major player in the global artificial intelligence race.

The announcements came Wednesday during India’s AI Impact Summit in New Delhi, a gathering of world leaders and top tech executives aimed at shaping the future of AI. Nvidia CEO Jensen Huang had been expected to attend but pulled out due to what the company described as “unforeseen circumstances.”

Nvidia said it is working with five venture capital firms, Peak XV, Z47, Elevation Capital, Nexus Venture Partners, and Accel India, to find and back AI startups at various stages of growth.

The company said more than 4,000 Indian AI startups have already joined its global Inception program, which helps young companies build products, grow, and reach customers.

The push aligns with India’s growing startup market, where venture investors have been pouring money into tech companies, drawn by a strong IPO market that has been delivering solid returns. As reported by Cryptopolitan, Nvidia is also a founding member of $2 billion India Deep Tech Alliance to mentor emerging AI firms across the country.

Yotta to build Asia’s largest AI hub in a $2 billion deal

In one of the biggest deals announced, Indian data center company Yotta Data Services said it will build one of Asia’s largest AI computing hubs using Nvidia’s latest Blackwell Ultra chips.

The project will cost more than $2 billion in total. As part of the deal, Nvidia will set up one of Asia-Pacific’s largest DGX Cloud clusters inside Yotta’s infrastructure under a four-year agreement worth over $1 billion. The facility, branded as Shakti Cloud, will run on more than 20,000 Nvidia Blackwell Ultra GPUs and is expected to go live by August.

It will be located at Yotta’s campus near New Delhi, with extra capacity coming from its site in Mumbai. Yotta is part of Indian billionaire Niranjan Hiranandani’s real estate group and already operates three data center campuses across India.

Nvidia also said it is working with other Indian cloud providers, including Larsen and Toubro and E2E Networks, to deliver AI computing infrastructure across the country.

The investments are part of a broader boom in AI spending in India.

Nvidia’s Nemotron models take aim at India’s language barrier

The stakes go well beyond business. The 2026 International AI Safety Report found that while more than half the population uses AI in some countries, adoption rates across much of Africa, Asia, and Latin America likely remain below 10%. India sits squarely in that gap.

Part of the problem is language. The world’s biggest AI chatbots do not work in all of India’s 22 official languages, let alone the hundreds of dialects spoken across the country. ChatGPT and Claude currently support around half of them. Google’s Gemini supports nine.

“Without tech that understands and speaks these languages, millions are excluded from the digital revolution, especially in education, governance, healthcare, and banking,” Professor Pushpak Bhattacharyya from IIT Mumbai told the BBC last summer.

India’s government has recognized the problem and is trying to fix it through its AI Mission, but progress has been slow. That’s where Nvidia emerges as a key driver.

The company is also helping Indian companies build AI systems using its Nemotron family of models, which organizations can use to develop chatbots, voice assistants, and AI agents. The models can be trained on India-specific data and support the country’s more than 22 officially recognized languages.

Several Indian companies are already using the technology.

BharatGen, backed by the Indian government, has built a 17-billion-parameter AI model. Gnani.ai is using it to build a speech model for Indian languages and has cut its inference costs by 15 times, now handling more than 10 million calls per day.

The National Payments Corporation of India is exploring using it to support its digital payment systems. Sarvam.ai has trained models across three sizes: 3 billion, 30 billion, and 100 billion parameters, covering 22 Indian languages.

As of September last year, India’s government had approved $18 billion worth of semiconductor projects as it works to build a domestic chip supply chain. Prime Minister Narendra Modi’s administration has set a goal of turning India into a global technology superpower.

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Telegram has begun blocking illegal content and has enough time to meet all Russian demands, according to a top member of a parliamentary committee concerned with the matter.

Authorities in Moscow slowed down traffic to the popular messenger earlier this month, alleging non-compliance with national regulations.

The measure was followed by media reports this week that the platform will be fully blocked on April 1, which Russian officials have yet to deny or confirm.

Telegram’s compliance with regulations to help avoid its blocking in Russia

Telegram has started actively complying with the Russian Federation’s requirements to block illegal content. That’s according to Andrey Svintsov, deputy chairman of the Committee on Information Policy at the State Duma, the lower house of Russian parliament.

Speaking to the official TASS news agency, Svintsov stated:

“Over the past week, Telegram has blocked more than 230,000 channels and pieces of content that violated current legislation. This indicates that Durov’s company has begun to interact more actively.”

“In my opinion, Telegram will not be blocked before April 1,” Svintsov added, speaking of the messenger founded and owned by Pavel Durov, who is also its CEO.

The tech entrepreneur left Russia more than a decade ago after rejecting pressure to hand over user data and censor content on VK, the Russian social network that he also founded and managed at the time.

Svintsov added that Telegram can fulfill the “realistic requirements” of Roskomnadzor within the next month or two and continue to operate in Russia.

Roskomnadzor (RKN), or the Federal Service for Supervision of Communications, Information Technology and Mass Media, is Russia’s telecom watchdog, which functions as a media censor as well.

“Opening a legal entity takes a week at most. Moving personal data processing takes another two or three weeks,” the deputy said, elaborating:

“Therefore, within a month or a month and a half, the entire set of requirements from Roskomnadzor can be fulfilled: opening a legal entity, storing data on Russian territory, paying taxes and blocking content.”

Last summer, reports that Telegram is preparing to establish an office and register an entity in Russia, as required by its so-called “landing law,” as well as earlier claims that the messenger was leaving the Russian market, were all directly or indirectly denied by Durov.

Telegram expected to remain available in Russia

It’s difficult to tell whether Telegram will be fully blocked in Russia at this point, according to Yulia Dolgova, president of the Russian Association of Bloggers and Agencies (ABA), who told TASS:

“Regarding a complete shutdown of access to the messenger, it’s difficult to say today. Unlike WhatsApp, Telegram is actively taking measures to maintain the functionality of its service.”

While slowing down Telegram last week, Roskomnadzor completely removed the domain of Meta’s messenger from its DNS servers, effectively cutting off access to WhatsApp from Russia.

Dolgova also highlighted the widespread use of means to bypass such blockades in the country, remarking: “We should not forget about the depth of penetration of VPN services among the Russian audience either.”

Reports of April 1 shutdown neither confirmed nor denied

Quoting sources from government agencies on Tuesday, the Telegram channel Baza posted that the RKN is preparing to “begin a total blocking of the messenger” on April 1.

Reacting to Russian media reports relaying this information, Roskomnadzor said it had “nothing to add” to its earlier statements, which threatened imposing “sequential restrictions.”

This week, TASS also revealed that on February 15, the messenger’s administration blocked 238,800 channels and groups that violated its policies.

It did the same regarding 187,300 channels and groups worldwide on February 16, the agency added, claiming to be quoting “updated statistics on the messenger’s website.”

“As of February 17, more than 7.463 million groups and channels have been blocked on Telegram since the beginning of the year,” the news agency also noted.

With 93.6 million users in Russia, Telegram is the second most popular messaging app in the country after WhatsApp, which had 94.5 million monthly users before it was blocked.

While Russia is taking restrictive measures against both and pushing the state-backed Max messenger, its citizens have been flocking to another alternative, the U.S.-made imo, as reported by Cryptopolitan.

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Jupiter DAO has opened the vote on imposing zero emissions for JUP tokens. The main goal is to remove the Jupuary event and avoid further token dilution under worsening market conditions. 

Jupiter DAO is preparing to alter its emission schedule, breaking away from its approach to Jupuary airdrops. The vote will end on February 22 and may cause a significant shift in the protocol.

As Cryptopolitan reported earlier, Jupuary has been under scrutiny for months, as market conditions kept stagnating even for the best-performing protocols. 

JUP remained range-bound despite a brief recovery in the past week, ahead of the zero net emissions vote on canceling Jupuary. | Source: Coingecko

According to Jupiter’s team, JUP is the token used as an alignment engine between the team, the community, as well as holders and stakers. The big problem is that JUP has fallen over the years, and now hovers at $0.16, near the bottom of its range. 

JUP still reacted to the potential for zero new emissions by climbing to a one-week local high. 

Jupiter DAO faces two options for JUP

The proposal focuses on a breakaway from the current practice of JUP airdrops by proposing zero net emissions. 

The vote offers two options: to continue with Jupuary or to adopt a new zero net emission schedule. 

If Jupuary is preserved, Jupiter DAO will bring out the airdrop checker a week after the vote, followed by a 200M JUP distribution. The remaining bonus pools and Jupnet incentives will continue on their own schedule. 

The alternative option will include a larger reorganization of JUP tokenomics. The platform will postpone Jupuary and return the prepared 700M tokens to the Community Cold Multisig wallet. The initial airdrop snapshot will remain valid for future use. 

In addition to canceling the airdrop, Jupiter will also have to stop team token emissions indefinitely, while accelerating Mercurial vesting. The goal is to also absorb sell pressure by buying back some of the newly released JUP. 

Jupiter tokenomics uses cliff vesting, which has the potential to put greater pressure on the market. The new proposal will greatly alter the predicted unlocks and potentially affect the JUP price. 

Community still calls for airdrops

Airdrops remain one of the few incentives for ongoing loyalty to crypto protocols. Jupuary was part of the Jupiter DAO promises, which kept the Jupiter community together. The events were widely presented as positives during a 2024 vote, which ushered in two instead of one Jupuary events. 

The contentious issue is that the Jupiter team will still receive their JUP rewards from Mercurial vesting, which also leads to significant dilution. Cutting out Jupuary is thus perceived as preserving team perks while cutting out rewards for the community. 

Airdrop mining has continued, but in the past months, the potential earnings from those events have been minimal. While Solana projects continue to produce significant fees, users have complained that the value of airdrops does not even offset the fees spent on trading or other on-chain activities. 

Abandoning community rewards may further hurt the incentives for on-chain participation, while questioning the real utility of protocols. Jupiter produces $839M in annualized fees, and its community rewards will be much lower without Jupuary.

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Macro uncertainty has been on the rise ever since last year, as reflected in the global uncertainty index, and this has weighed heavily on the crypto markets. Adding to this pressure, yesterday, news surrounded Iran conducting live-fire missile drills near the Strait of Hormuz, one of the world’s most important oil shipping routes, re-escalating geopolitical tensions in the Middle East. The drills were conducted by Iran’s Revolutionary Guard at a time when the United States and Iran began a new round of high-stakes nuclear negotiations in Geneva. 

The timing was certainly not coincidental. These drills come alongside U.S. military deployments in the region and ongoing disagreements over Iran’s nuclear programme, sanctions relief and regional influence. Negotiations have been firm from both sides with Iran warning it is ready to retaliate against any aggression while the U.S. has hinted that military options remain on the table if diplomacy fails. 

Even though the missile launches weren’t part of any active conflict, any activity in the Strait of Hormuz gets alarm bells ringing worldwide. With around 20% of global shipments passing through this key passage, any tensions within this region becomes a reminder of how delicate this region is and how easily there can be ripple effects across oil prices, inflation, and financial markets worldwide, including crypto.   

Why the Strait of Hormuz Matters to Global Markets 

The Strait of Hormuz is a narrow shipping lane in the Middle East and one of the most important energy chokepoints in the world. This region roughly sees around 20 million barrels of oil pass by per day, thereby accounting for nearly 20% of world’s petroleum supply. Therefore, any conflicts or disruptions in this route automatically raises concerns about energy supply around the globe and questions are raised about broader economic stability. 

The fact is, even a threat of disruption is enough to push buyers to look for alternative supply from other oil-producing regions and tap into existing stockpiles. Both responses typically come with higher costs, which pushes oil prices up and increases volatility. Previous instances of uncertainty in this region have shown how quickly oil markets react. For example, escalation here last year in June between the U.S. and Iran resulted in oil prices rising a staggering 21% from around $63 to $77 in a matter of days. 

Ultimately, oil is a core input for the global economy and any disruption to the trade can have a knock on effect into financial markets and assets worldwide. 

Oil and Inflation Expectations Being Repriced 

When oil prices rise, they tend to have a domino effect across transportation, manufacturing and food costs, gradually filtering through supply chains and into consumer prices. This transmission does not happen overnight; there is typically a lag before higher energy costs show up in inflation data such as the Consumer Price Index (CPI). As businesses absorb rising input costs, they eventually pass them on to consumers, which is why energy-driven inflation often unfolds over months rather than days. 

As inflation expectations increase, financial markets begin reassessing this risk almost instantly. In response, bond yields often rise as investors anticipate tighter monetary policy, equities can face pressure from higher costs and slower growth projections and assets like crypto can turn volatile as the general economic outlook and liquidity is reassessed. 

Central Bank Policy Implications 

The chances of rising inflation puts central banks in a peculiar and uncomfortable position. If inflation tends to trend higher, policymakers may be forced to delay interest rate cuts or keep borrowing costs higher for longer. In financial markets, this shift from dovish to a hawkish stance is closely watched by investors because it directly shapes the overall direction of global liquidity. 

Another corollary is that higher interest rates often strengthens the U.S. dollar as investors go in search for higher yielding and safer assets. A rising dollar and tighter liquidity are a combination that does not bode well for global markets, especially crypto. 

Crypto’s Increasing Macro Correlation 

Over the past few years, Bitcoin has become noticeably more sensitive to macro shocks, particularly during periods of tightening financial conditions or market stress. Research shows its correlation with major equity indices has risen significantly alongside institutional adoption and broader participation from traditional investors. In fact, correlations with major growth stocks have increased markedly following key milestones such as Bitcoin ETF launches and corporate treasury adoption, highlighting how the asset is becoming more integrated into global financial markets. At the same time, Bitcoin still retains unique drivers, such as its fixed supply and halving cycle, meaning it does not move in lockstep with traditional assets at all times. 

A key reason for this growing sensitivity is the liquidity-driven nature of crypto markets. Bitcoin increasingly responds to global capital flows and monetary policy cycles, especially as ETFs and institutional portfolios make access easier and more familiar for traditional investors. This deeper integration means crypto now sits closer to the broader financial system: it can behave like a macro-sensitive asset in the short term while still maintaining distinct long-term characteristics tied to adoption, technology, and network growth.

What Traders are Watching Next 

For now, this is still a developing macro story which deserves close attention for coming days to weeks. Any change in escalation to de-escalation during times like these can quickly have an effect on market sentiment. Recent reports indicate that Iran has offered partial nuclear concessions in ongoing talks, including a proposal to pause uranium enrichment for a limited period and send part of its highly enriched stockpile abroad in return for sanctions relief. The primary demand from the U.S. to completely halt enrichment however remains on the table and this is the point of contention that still needs to be played out. 

Apart from geopolitics, traders will need to keep a close eye on the U.S. dollar and bond yields as this will provide some clarity on how markets are seeing risk. The DXY had a sharp wick yesterday following yesterday’s news but ultimately more news filtering will be needed to confirm a more definitive trend.  

Bitcoin’s price behavior is signaling deeper financial stress that traditional markets have yet to price in, according to Arthur Hayes, co‑founder of cryptocurrency exchange BitMEX.

Hayes said this week that the leading cryptocurrency’s continued decline, which has diverged sharply from the relatively flat performance of the Nasdaq 100 Index, could be “flashing” early warnings of tightening credit conditions in the U.S. dollar economy, potentially foreshadowing a broader credit crunch. In a post on his Substack newsletter, he described Bitcoin as acting like a “fiat liquidity fire alarm,” reacting before equities and other traditional indicators.

Bitcoin is showing that credit in the financial system is falling

Arthur Hayes said Bitcoin is an early warning sign of economic problems ahead because it’s highly sensitive to changes in the financial system and reacts faster than most traditional assets. Hayes explained that BTC stocks and other investments take longer to reflect the impact of falling liquidity than BTC does.

He also said that a falling Bitcoin price while the Nasdaq 100 Index stays stable is usually a sign of problems in the financial system that stock prices haven’t yet reflected, and that will soon affect broader markets.

Hays mentioned the growing impact of AI on white-collar jobs and said many people could lose their income and struggle to pay off debts, including credit card bills, car loans, and mortgages. He estimates that banks could lose up to $330 billion in consumer credit and $227 billion in mortgage debt if 20% of the country’s 72.1 million knowledge workers were affected.

Banks will likely give out fewer loans or make borrowing harder for everyone when they notice more people falling behind on their payments. This will, in turn, slow down the flow of money into the economy because people who can’t borrow as easily will spend less, forcing businesses to make less.

According to Hayes, weaker banks will feel the impact of this chain reaction the most, and some could even become insolvent because they lack the funds to cover obligations. In the end, everyone, including consumers and businesses that rely on credit to operate, will be affected.

AI job losses could make banks lose money and force the Federal Reserve to step in

Arthur Hayes says AI tools can now handle tasks that required large human teams, so industries like software-as-a-service companies have been underperforming compared to tech stocks in recent months.

He also explained that these job losses have led to an increase in credit card delinquencies and have placed immense pressure on consumer discretionary companies, as households are now struggling to keep up with debt payments.

Hayes warns that the Federal Reserve may have to step in with large-scale support to prevent the situation from becoming a full-blown crisis.

Other analysts also agree that significant banking problems would definitely lead to government intervention. They believe this could, in turn, make Bitcoin and other scarce digital assets more attractive by undermining trust in traditional money systems. 

When a system relies on more money printing to survive, people begin to see scarce assets as a safer place to store value. Hayes presents two potential market routes in the face of this situation, as explained in the article.

The first is that the fall of Bitcoin from $126,000 to $60,000 may already be pricing in the slowdown, with stocks having time to catch up. Alternatively, the fall in Bitcoin may continue, with stocks later catching up as they too price in the same credit risks. 

In either case, the outcome is likely to be the same: lots of money will be pumped into the system to prevent widespread bank problems.

Hayes believes this reaction could offset Bitcoin’s losses and even propel it to new all-time highs once the system stabilizes again. This is an example of how job losses, credit issues, and bank stress can all impact one another, with early signs of what is to come in Bitcoin.

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Mubadala Investment Company, the sovereign wealth fund of Abu Dhabi, has revealed that it now holds over 12 million shares of BlackRock’s iShares Bitcoin Trust (IBIT).

The holding was valued at approximately $630.6 million as of the end of 2025. The fund grew its holdings by 46% in a period of three months, going from 8.7 million shares at the end of September to 12.7 million shares by the end of December.

How much Bitcoin exposure does Abu Dhabi have?

Abu Dhabi’s sovereign wealth fund, Mubadala Investment Company, now owns over $630 million worth of BlackRock’s spot Bitcoin ETF (IBIT), according to a new 13F filing submitted to the U.S. Securities and Exchange Commission (SEC) on February 17, 2026.

The filing shows that as of December 31, 2025, Mubadala held exactly 12,702,323 shares of the iShares Bitcoin Trust and 8,726,972 shares as of September 30, 2025. The fund grew its Bitcoin position by 46% in just three months.

Major global financial players now regard Bitcoin as a standard part of a large investment portfolio despite its volatility at the start of 2026. Bitcoin prices slid from an all-time high above $100,000 down to the $68,000 range this February.

Sovereign wealth funds (SWFs) have remained cautious about digital assets for years. However, the launch and success of spot ETFs like BlackRock’s IBIT have encouraged state-backed funds like Mubadala to invest.

The same filing that revealed the Bitcoin stake also showed huge holdings in some of the world’s most important technology companies. For example, GlobalFoundries (GFS), which remains Mubadala’s largest holding, is valued at over $15.7 billion with 450 million shares. ARM Holdings (ARM) holds 1.37 million shares valued at approximately $150.5 million, while Blue Owl Technology Finance (OTF) holds a massive position of 29.1 million shares worth over $423 million.

Institutional crypto adoption

Goldman Sachs recently revealed in a separate filing that it holds over $1.1 billion in the same BlackRock Bitcoin ETF. Other major banks, including Bank of America and Morgan Stanley, have recently updated their policies to allow their thousands of financial advisors to recommend Bitcoin ETFs to wealthy clients.

Abu Dhabi has worked hard to create a clear legal framework for digital assets, and by having its own sovereign fund invest so heavily, the government is “leading by example” to encourage other regional funds and private family offices to consider similar allocations.

However, Bitcoin is currently trading around $68,362, and some analysts, including those from Standard Chartered, have recently lowered their price targets, suggesting Bitcoin could decline to the $50,000 level if current market pressures continue.

Despite the price drop, the capital held in ETFs has remained relatively stable because its investors are mostly institutional buyers, like Mubadala, who do not panic-sell during monthly price swings.

The 13F filing also highlights Mubadala’s diverse interests beyond just tech and crypto. The fund holds positions in healthcare companies like AbbVie ($3.8M) and CVS Health ($11.8M), as well as gold mining companies like Agnico Eagle Mines ($7.4M) and Barrick Gold ($9.8M).

Other notable holdings in Mubadala’s portfolio include Adobe Inc and Walt Disney, which hold $4 million each. Ford Motor Company is slightly ahead with $4.3 million.

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Donald Trump said the $550 billion trade deal with Japan has officially launched. Trump posted the announcement on Truth Social.

He said Japan has started the first round of funding tied to the agreement. The deal commits $550 billion from Japan into projects across the United States. The focus is industry, energy, and minerals.

Trump wrote, “Our MASSIVE Trade Deal with Japan has just launched! Japan is now officially, and financially, moving forward with the FIRST set of Investments under its $550 BILLION Dollar Commitment to invest in the United States of America — part of our Historic Trade Deal to REVITALIZE the American Industrial Base, create HUNDREDS OF THOUSANDS of GREAT American Jobs, and strengthen our National and Economic Security like never before.” He said tariffs made the projects possible.

He announced three projects tied to the deal with Japan. One is oil and gas in Texas. One is power generation in Ohio. One is critical minerals in Georgia. Trump wrote, “Today, I am pleased to announce three TREMENDOUS Projects in the Strategic Areas of Oil & Gas in the Great State of Texas, Power Generation in the Great State of Ohio, and Critical Minerals in the Great State of Georgia.”

Trump said the gas plant in Ohio will be the largest in history. He said the LNG facility in the Gulf of America will increase exports. He said the minerals facility will end dependence on foreign sources.

Trump added, “America is building again. America is producing again. And America is WINNING again. This is a very exciting and HISTORIC time for the United States of America and Japan. Congratulations to all!”

Exports surge while U.S. shipments fall

New data showed exports from Japan climbed 16.8% in January compared with a year earlier. That beat expectations of 12%. It was the fastest pace since November 2022. December growth was 5.1%. Shipments to Asia rose nearly 26%. Exports to Western Europe increased more than 25%. North America recorded a 3.3% drop.

Exports to China jumped 32% after rising 5.6% in December. China remains the largest trading partner of Japan. The increase came during a diplomatic dispute tied to comments on Taiwan made by Prime Minister Sanae Takaichi.

Shipments to the United States fell 5% after dropping 11.1% in December. The United States is the second largest trading partner of Japan.

Food exports rose 31.3%. Machinery increased 14.3%. Electrical machinery, including chips, climbed 27.3%.

Transport equipment rose 0.8%. That category makes up over 20% of total exports and includes cars and auto parts. The sector has faced pressure from U.S. tariffs.

IMF urges rate hikes as economy slows

Markets reacted quickly. The Nikkei 225 gained 0.9%. The Topix rose 1.26%. The yen strengthened to 153.43 per dollar. The 10-year government bond yield slipped 1 basis point to 2.119%.

The International Monetary Fund urged Japan to keep raising interest rates. The IMF warned against loosening fiscal policy. It said cutting the consumption tax would weaken the country’s ability to respond to future shocks.

Sanae Takaichi won a landslide election and pledged to suspend the 8% consumption tax on food for two years. Investors are watching whether Sanae will resist further rate increases by the central bank.

The IMF said the Bank of Japan’s “continued independence and credibility” will keep inflation expectations anchored. It stated, “The BOJ is appropriately withdrawing monetary accommodation, and gradual hikes should continue to move the policy rate toward neutral.” It also said, “As the baseline projection continues to materialize, withdrawal of policy accommodation should continue so that the policy rate reaches a neutral stance in 2027.”

The economy of Japan grew 0.1% year on year in the fourth quarter. Private demand supported growth. Net exports reduced output by 0.8 percentage point.

For the full year, GDP expanded 1.1%. Shipments fell in the middle of 2025 due to tariff concerns. They rebounded later in the year after duties were reduced to 15% under the trade agreement with the United States involving Japan.

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