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Solana validators narrowly approved a proposal to double the network’s annual disinflation rate. It cleared the two-thirds supermajority by just 0.33 percentage points after Kraken flipped most of its stake from no to yes in the last hours. SGP-0002, Double Disinflation, passed with 67% support against 25.16% opposition and 7.84% abstentions, on a turnout of 60.7% of eligible stake.
Support was just above the 66.67% bar that the measure needed to pass. Both supply proposals were turned down by Kraken at 12:33 UTC on August 28. This put SGP-0002 below the supermajority with just less than three hours to go until the count stopped at 15:00 UTC for epoch 1024. Earlier that morning, support stood at 68.77%, with about 47.72% of eligible stake having voted. Kraken’s no vote knocked support down to about 65%. Then Kraken moved again. By the close, the proposal had the support of over 90% of the US exchange’s ~8.9 million SOL of voting stake.
Solana proposal narrowly passed by 0.33%
The plan, tied to SIMD-0550, would double the yearly disinflation rate on Solana from 15% to 30% but keep the network’s long-term inflation target at 1.5%. Under the old path, Solana would hit its 1.5% terminal rate in about 5.7 years, but now it will hit it in about 2.8 years. This is an estimated 18.9 million fewer SOL entering circulation over the next six years. The positive side is less dilution for SOL holders, but the downside is lower staking rewards for validators and delegators.
Figment, which had 17.1 million SOL in the finalized governance data, voted against the proposal, while Helius and Jupiter voted for it. Other prominent custodial stakers opposed at least SGP-0002, including Everstake and P2P Validator. Since custodial exchanges get paid when new SOL is issued, disinflation that happens faster means that the APY goes down faster and less money comes in. That logic is “mathematically nonsense,” said Mert Mumtaz, CEO of Helius and a co-author of the proposals, in an X post.
He said any advance in price from slower supply growth would be bigger than the saved yield. Solana Company, a Nasdaq-listed treasury company that trades under the symbol HSDT, said on August 21 that it supports the Solana Constitution but opposes both supply proposals. Reopening the inflation schedule introduces doubt into the multi-year models that institutions use, the firm said. SGP-0002 was one piece of Solana’s first binding governance process. The Solana Constitution, SGP-0001, passed with 85.97% support.
SGP-0003 failed with 53.90% support. The fee change under SIMD-0553 would have made transactions pay for the computing power they book, and burned part of what they paid. The rejection means SOL burns will remain around 650 SOL per day. This is in contrast to the 7,500 to 9,000 SOL, ~$800,000 a day at current prices, that the fee change would have generated. SOL was trading at about $104, down about 5.2% on the day, according to data from CoinGecko. Both rejected supply proposals may be resubmitted without any cooling-off period. But supporters would have to win over custodians who have now gone on the record with their objections.
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The Commodity and Futures Trading Commission (CFTC) has slammed Gabriel Perez, who ran President Donald Trump’s teleprompter for nearly a decade, with a $172,000 fine to settle charges that he bet on Trump’s own speeches using words he read ahead of anyone else.
Prediction markets have rapidly gained popularity in 2026, and this settlement is the first known case of a White House insider caught trading on the platform. Regulators have also issued warnings to government staff that their access to nonpublic information is not a betting edge. Gabriel Perez, President Trump’s longtime teleprompter, has been charged by the CFTC with placing bets on Kalshi’s “mention markets” where traders can guess whether a public figure will utter a specific word or phrase during an event.
CFTC says Perez used words he read to bet on markets
Perez had an unfair advantage because he was often the last aide to see Trump’s remarks before delivery. The CFTC found he traded on that confidential text for “his own personal, financial benefit.” The regulator counted 49 trades between December 2025 and February 2026, of which Perez won 39, clearing north of $107,000. He made bets on what Trump might say at the State of the Union, the National Prayer Breakfast, a Medal of Honor ceremony and assorted rallies.
The CFTC has ordered Perez to give up $107,539.02 in trading profits and pay a separate civil penalty of $65,000. Kalshi also banned him from the platform for three years. The CFTC said Perez’s penalty was reduced because he showed “exemplary co-operation.” They took into consideration that he voluntarily admitted his guilt in an interview, saying that his trading decisions were indeed based on the confidential information he had learned from his review of the speeches.
Christy Goldsmith Romero, a former CFTC commissioner appointed under President Joe Biden, stated that the CFTC missed an opportunity to “send a strong message” to future insider traders. Perez was discovered after Kalshi’s surveillance team spotted abnormal activity on Trump-related mention markets, traced the account and linked it to a federal employee running White House teleprompters. The matter was then referred to the CFTC. Bobby DeNault, who heads enforcement at Kalshi, said on X that anyone who violates the company’s rules or federal law would “face the consequences.”
Perez, who had worked for Trump since the 2016 campaign and earned $175,000 a year as a deputy assistant to the president, was placed on unpaid leave in July. Then-press secretary Karoline Leavitt called the conduct “a disgrace,” and by late that month, Perez was reportedly no longer working for the federal government. Cryptopolitan reported that the CFTC settled with former Republican Rep. George Santos in August over a Kalshi contract on whether he would attend the State of the Union.
Federal prosecutors have also charged an Army soldier over Polymarket bets tied to the capture of Venezuelan leader Nicolás Maduro and a Google engineer who made roughly $1.2 million trading on internal search data. CFTC Chairman Michael Selig, a Trump appointee, has backed the prediction-market industry but also pledged to police insider trading inside it.
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Avici has pledged full refunds to all 1,685 users affected by an August 28 breach that drained $500,859.22 from card balances.
The Solana-based neobank said its card-issuing partner Rain traced the incident to a flawed version of a Solana card contract used by Avici and “a small number of other programs” before being upgraded. The incident was followed by Ajna’s exploit one day later.
Avici Promises Full Repayment After Card Exploit
In an August 28 post on X, Avici said, “All affected card balances will be refunded in full.” The company confirmed that the compromised balances totaled $500,859.22 across 1,685 users.
DefiLlama’s hack database records the loss at $500,859 and classifies the incident as a withdrawal logic flaw in a Rust-based protocol. Early reports had estimated losses between $600,000 and more than $1 million.
The attacker reportedly invoked SubmitSignatures on Avici’s authorization program, then used AddCollateralAdmin on its collateral program before calling WithdrawCollateralAsset to remove funds. The attacking wallet later held about 10,005 SOL, worth roughly $1.07 million at the time, plus around $11,600 in stablecoins.
The AVICI token dropped about 39% in 24 hours to near $0.26 and briefly touched a new all-time low around $0.2189. That decline left the token more than 96% below its November 2025 peak of $7.61.
At the time of writing, AVICI had recovered to about $0.3093 but remained down more than 27.8% over 24 hours, according to CoinMarketCap.
Ajna Reports Losses From Liquidation Accounting Manipulation
On August 29, on-chain monitoring firm Defimon Alerts reported that Ethereum lending protocol Ajna lost about $775,000 through liquidation accounting manipulation. The syrupUSDC pool alone accounted for $173,700 of the reported losses.
Defimon said it detected a prepared attack more than an hour before the first exploit transaction and warned Ajna through Discord, but said the protocol “failed to react.”
Ajna later confirmed it was investigating “unusual movements” and advised users to withdraw funds, repay loans, and stop interacting with the protocol. DefiLlama data showed Ajna’s total value locked at about $246,880, down 71.3% over the previous 30 days.
Audited Crypto Protocols Face Heavy Security Losses
CoinGecko’s report “2026’s State of Crypto Security” documented more than 245 incidents between January 2025 and July 2026, with losses totaling $3.63 billion. Among them, 147 involved audited protocols and represented 88.44% of all stolen capital.
The report found that most attacks targeted infrastructure, third-party services, governance, or human error rather than flaws covered by audits. Active on-chain insurance also fell to 20.2% of the market, declining from $163.2 million to $130.2 million. By August 2026, five of nine on-chain insurance protocols had reportedly become inactive or shifted their business models.
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Avici, a neobank built on the Solana blockchain, is investigating a security breach that emptied user funds on August 28. Anything from $600,000 to more than $1 million may have been lost, per initial reports. Avici’s AVICI token lost roughly 39% of its value in a single day following the hack.
Avici, a Solana-based neobank that offers banking-style services like spendable card balances backed by crypto, confirmed that there was an “issue affecting card balance withdrawals,” but has not stated how much was lost or if users will be repaid. AVICI, the native token of the neobank, crashed following news of the security breach. The breach was discovered through a post from @SolanaFloor on X.
AVICI suffers drastic crash after news of exploit
According to reports, the hacker first ran a function called SubmitSignatures on Avici’s authorization program, then they called AddCollateralAdmin on Avici’s collateral program, and finally they ran WithdrawCollateralAsset to take the funds out. The attacker’s wallet held about 10,005 SOL, worth around $1.07 million at the time, plus about $11,600 in stablecoins. A blockchain analyst named STACC created a real-time tracker that found 125 different user accounts were affected.
The amounts taken ranged from about $9 USDC to over $26,000 USDT per account. Hackers allegedly drained somewhere between $600,000 and over $1 million altogether from user accounts. Avici said on X that it is monitoring the situation, adding that it is working with partners toward a fix and would share more when it has details. Following the news, the AVICI token dropped by about 39% over 24 hours to around $0.2175.
During the day, the price moved between a low of $0.2189 and a high of $0.4459. AVICI peaked at $7.61 on November 26, 2025, meaning the token now sits about 96% below its record high. CoinMarketCap lists a market capitalization near $3.39 million, a circulating supply of roughly 12.9 million tokens, and about 12,400 holders. In the same week as the Avici drain, The Sandbox moved to repay bridge-exploit victims 1:1 after a theft that Cryptopolitan reported cost holders about $697,000.
Meanwhile, MANTRA published a report regarding a roughly $3.6 million exploit, but it did not include its recovery plan for the funds. Days earlier, Cryptopolitan reported that the lending protocol Moonwell was attacked, and as much as $9 million was stolen in a price-manipulation exploit.
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Bitcoin now moves almost in sync with gold. Bitfinex analysts say the link has mounted to a reading its own history keeps breaking. The exchange made its case based on the idea that investors who are worried about government debt and loose monetary policy look to both metals and crypto as a safe place to put their money.
In a post on August 28, 2026, Bitfinex said BTC and gold were versions of the same debasement hedge, with Bitcoin being the “higher-beta version.” The correlation, the analysts wrote, is “near the top of a range it never holds for long.” “The BTC to gold correlation is near the top of a range it never holds for long,” wrote Bitfinex on X. When two assets track each other so closely, something usually forces them apart. The next stress test was flagged by Bitfinex, which said a risk-off shock would uncover “whether bitcoin holds with gold or falls with stocks.”
Bitfinex discusses the correlation between BTC and gold
Bitfinex says it sees Bitcoin’s cycle turning past the gold link. In another post on August 27, Bitfinex said the asset had “left accumulation” and entered expansion. Its Delta-Thermo Market Multiple was 2.03, just below the 2.5x level the model uses to signal the start of a bull phase, with a 3.5x distribution top further out. Analysts were clear that they read this “as the start of the bull phase, not a run into a top.”
On August 19, Treasury Secretary Scott Bessent doubled each of the government’s long-dated bond buyback operations to a floor of $4 billion, up from $2 billion, Cryptopolitan reported, with the schedule running September 9 through November 4. Long-term yields rose to near two-decade highs, with the 30-year at 5.337% on tepid demand. The signal came in, the dollar fell, gold got a bid, and Bitcoin rallied.
Bitfinex linked the current scenario to a similar period in 2024, where strategists at JPMorgan attributed the move to “concerns about ‘debt debasement’ due to persistently high government deficits.” Federal Reserve chairman Kevin Warsh made his Jackson Hole debut with a hawkish stance, stressing that the 2% inflation goal was still at large and hinting at upcoming interest rate hikes. Higher rates go against the debasement narrative that Bitfinex says is driving the trade.
Crypto’s fear and greed index hit 81, its first “extreme greed” reading in 616 days, and funding rates also hit a 20-month high. Short-term holder whales cashed in profits of about $1.2 billion from August 20 to 22. A rally leaning on borrowed money and meeting whale selling is the kind of flimsy setup a risk-off jolt might lay bare.
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CFTC enforcement action against Gabriel Perez has ended with the former White House teleprompter operator agreeing to pay more than $172,000 over trades tied to President Donald Trump’s speeches.
Perez, who operated Trump’s teleprompter for nearly a decade, was accused of using advance access to prepared remarks to place wagers on Kalshi mention markets. The contracts allowed traders to bet on whether Trump would use particular words or phrases during public appearances. The case comes as prediction markets expand rapidly.
CFTC Details Perez Trading Activity
The CFTC said Perez made 49 trades between December 2025 and February 2026 and won 39 of them. His profits exceeded $107,000, according to the regulator.
The trades involved events including the State of the Union, the National Prayer Breakfast, a Medal of Honor ceremony and several rallies. Investigators said Perez often reviewed Trump’s remarks shortly before delivery and used the confidential text for “his own personal, financial benefit.”
Perez was ordered to surrender $107,539.02 in trading profits and pay a $65,000 civil penalty. Kalshi separately banned him from trading on the platform for three years.
The CFTC said the penalty was reduced because Perez provided “exemplary co-operation.” Regulators said he voluntarily acknowledged during an interview that his trading decisions were based on confidential information obtained while reviewing speeches.
Kalshi Surveillance Flagged Suspicious Bets
Kalshi’s surveillance team identified unusual activity in Trump-related mention markets and traced the account to a federal employee responsible for White House teleprompters. The company then referred the matter to the CFTC.
Bobby DeNault, Kalshi’s head of enforcement, said on X that anyone who breaks company rules or federal law would “face the consequences.”
Perez had worked for Trump since the 2016 campaign and earned $175,000 annually as a deputy assistant to the president. He was placed on unpaid leave in July, and then-press secretary Karoline Leavitt called the conduct “a disgrace.” Perez was reportedly no longer employed by the federal government by late July.
Prediction Market Enforcement Expands
Christy Goldsmith Romero, a former CFTC commissioner appointed under President Joe Biden, said the regulator missed an opportunity to “send a strong message” to future insider traders.
The CFTC also settled with former Republican Representative George Santos in August over a Kalshi contract involving whether he would attend the State of the Union.
Federal prosecutors have separately charged an Army soldier over Polymarket bets connected to the capture of Venezuelan leader Nicolás Maduro. A Google engineer was also charged after making about $1.2 million from trades based on internal search data.
CFTC Chairman Michael Selig, a Trump appointee, has supported the prediction-market industry while pledging to enforce rules against insider trading.
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Meta is considering deploying robots to plug in cables, reboot servers, and inspect equipment at its data centers. Current and former staff say the machines could reduce the ranks of technicians propping up its AI buildout.
The hardware is sourced from a mix of suppliers, said workers who asked not to be identified in a report by Wired. They are Watney Robotics in San Francisco, Kinova in Quebec, and ABB in Zurich. In one experiment, a Kinova Gen3 robotic arm is tasked with cutting power to servers, while another machine is being tested to swap networking cables. At some sites, the company has already deployed a device resembling a finger or a pointy stick that presses the power button on a Mac Mini or similar box to reboot it at the command of a remote human.
Meta data center employees wary about being replaced
Meta has since declined to comment on the testing, while Kinova and ABB declined to comment. Also, Watney did not respond to questions. A cable-swapping robot that works could take over 80% of some people’s workloads, one Meta data center employee said. That estimate did not come from a Meta prediction but from the worker, who said the machine still can’t match the speed of a human.
“We thought those of us performing the physical tasks were safe for a while, but not anymore,” one worker said. He added, “It’s coming for us all, unfortunately.” Some employees said Meta is building software to let it hire cheaper, lower-skilled staff and shift some roles to cost-friendly hubs like Denver. One said the company needs “smart hands,” people who can take instructions from AI without breaking anything. The long-term goals shared by Meta are to put robots in data centers.
Eric Xu, senior manager for robotics at Meta, mentioned at a conference last year that they could speed up incident response, monitor the environment, and handle preventative maintenance. The machines need to be supervised, and they falter on obstacles, short battery life, visual inspections, and tightly packed cabling. Industry trials sometimes failed in the past with robots crushing servers on simple tasks. In May 2026, the company began laying off about 8,000 employees, or about 10% of its workforce, and data center staff were among those layoffs.
The cuts were presented in part as freeing up cash for AI spending, with the company’s capital expenditure forecast of $125 billion to $145 billion for the year, more than double the prior year. ACE Robotics chairman Wang Xiaogang said embodied AI could have a “ChatGPT moment” by the end of 2027. Cryptopolitan reported that Unitree founder Wang Xingxing put a similar leap two to three years out, and as long as five to ten if progress stalls. He likened it to a robot doing about 80% of the work in an unfamiliar environment.
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Honda and Nissan are expected to agree as soon as Monday to develop one operating system and one onboard computer for their vehicles. The shared tech is for models due about 2029.
Honda CEO Toshihiro Mibe and Nissan CEO Ivan Espinosa walked away from a merger attempt. A common operating system and a shared onboard computer let them split the engineering bill for the software-defined vehicle. Features are in code, which updates over the air, not baked into fixed hardware.
Honda and Nissan to split engineering costs
The target for fitting the joint system into new cars is 2029. Nissan is the weaker financially, and that makes sharing all the more sensible. The maker of the Leaf EV and the Infiniti luxury line posted a loss for the April to June period following a full year in the red. It has eliminated jobs and brought Espinosa as the new chief to spearhead a turnaround, according to Cryptopolitan.
President Donald Trump’s tariffs are squeezing Japan’s carmakers, and Nissan is feeling the pinch. Nissan has begun public road trials in Tokyo with British startup Wayve. According to Cryptopolitan, Nissan Ariya electric models have had Wayve’s “eyes on, hands off” Level 2 system installed ahead of a consumer launch Wayve is aiming for in 2027.
The car is responsible for the speed and steering. The driver has to be ready to take over. Nissan is also developing its own driver-assist features. Nissan was one of the automakers to adopt Nvidia’s DRIVE Hyperion self-driving platform, which was detailed at Nvidia’s GTC 2026 event. Honda was in a distinct group of manufacturers that used Nvidia’s industrial design tools. Below that network of outside suppliers would be a shared Honda-Nissan computer, giving both a common base to plug into.
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Solana has activated the first of five feature gates targeting a 90% reduction in refundable deposits for on-chain storage.
Anza, the network’s core development team, announced the initial activation on testnet.
The phased rollout lowers upfront capital requirements for developers creating token accounts and users joining the network. Stablecoin issuers, payment companies, and wallets are among the businesses set to benefit.
Stablecoins and payments represent some of the network’s fastest-growing use cases, making lower onboarding deposits relevant for businesses.
Solana Rent Reduction Follows Five Activation Gates
SIMD-0437, written by Anza’s Igor Durovic, lowers the lamports_per_byte constant governing minimum account balances from 6,960 to 696.
The five stages move the rate from 6,960 to 6,333, then 5,080, 2,575, 1,322, and finally 696. The first reduction amounts to approximately 9%, while the full rollout delivers the targeted 90% cut.
According to the Solana Foundation, the constant remained unchanged for years. Consequently, storage deposits increased with SOL’s value instead of reflecting validators’ actual storage costs.
Each remaining gate requires separate activation following reviews of state growth. The announcement therefore does not represent an immediate 90% reduction on mainnet.
Solana Token Account Deposits Reduce Payment Onboarding Costs
Rent is a refundable bond rather than a transaction fee, the Foundation explains. SOL remains locked while an account exists and becomes recoverable when that account closes.
The Foundation’s example places a standard SPL token account deposit at $0.159 before the changes and $0.0159 afterward. Creating one million accounts would therefore require $15,900 instead of $159,000 once all five reductions take effect.
Lower deposits reduce the fixed capital needed for mass account creation, making it easier for fintech companies and wallets to fund onboarding.
The changes support Solana’s efforts over the past year to establish itself as a settlement network beyond speculation. The payment volume rose 755.3% in 2025, alongside stablecoins from Western Union, PayPal and Fiserv.
Solana Storage Safeguards Guide Agave Rollout
Cheaper storage raises concerns about expanding on-chain state, which every validator must store and index. A sixth fallback gate can restore the original 6,960 rate.
Companion proposal SIMD-0392 permits future rent increases without disrupting existing accounts. Foundation researcher Umberto Natale’s published modeling estimated that exhausting current storage headroom after a tenfold reduction would require roughly $17.2 million in locked capital.
Natale concluded that the reduction presents no systemic risk to the cluster.
The changes ship with Agave 4.2, recommended for mainnet in August 2026. The release also includes 4,096-byte transactions and slot times halved to 200 milliseconds.
The Foundation said mainnet feature activations began the week of August 17. Existing accounts continue operating unchanged and can reduce balances to the new minimum.
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Brazil has filed a civil collective moral damages lawsuit against Discord seeking 500 million reais, roughly $97 million, over what it says are failures to comply with laws protecting children and women, per Reuters.
Solicitor General Jorge Messias announced the action Wednesday. It follows an order this month from the National Data Protection Authority requiring Discord to suspend livestreams and video calls in Brazil, issued after a 13-year-old girl died by suicide following a broadcast in which authorities say she was encouraged to harm herself. Discord filed an appeal against that suspension on Monday, which the agency told AFP is under review.
Brazil levies fines against Discord and TikTok
The lawsuit exceeds what the regulator itself could impose. The data protection agency launched its probe in early August on the recommendation of the Digital Rights Secretariat and gave Discord five days to demonstrate how it protects children and teenagers, with penalties of up to 50 million reais if it fails, MLex reports. It ordered the suspension on August 12, and Discord complied on August 17, saying it was seeking a solution to restore the features.
Going to court for ten times the administrative maximum is how the government reaches past its own regulator. The Discord suit arrived within a week of the enforcement. On Tuesday, the authorities in Brazil also fined TikTok 153.7 million reais, close to $30 million, for irregularities in processing the data of children and adolescents, and ordered ByteDance to delete data collected in breach of the rules, per AFP. The regulator estimated that the company might have processed data from as many as 8 million children and cited flaws in the process of age verification.
TikTok has 10 days to appeal, and the company has said that it will be complying with new rules that include tougher default privacy settings for under-16s, increased parental controls, and enhanced content filtering. The company agreed last week to pay $400 million to settle a separate US Justice Department case over children’s privacy. Agency director Lorena Giuberti Coutinho said proceedings began last week to check whether 22 social media networks and platforms comply with a child protection law Brazil passed this year.
The law requires accounts belonging to users under 16 to be linked to a parent’s and obliges platforms to verify ages. “I think we can expect much stronger enforcement action in the months ahead,” Lorena Giuberti Coutinho said. Brazil has moved against large platforms before. X was blocked for 40 days in 2024 until it complied with Supreme Court orders to remove accounts accused of spreading disinformation. Separately, the consumer rights group Collective Defense Institute is seeking 3 billion reais from the Brazilian units of TikTok, Kwai and Meta over minors’ use of their services.
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Moonwell suffered an exploit on Wednesday after an attacker manipulated the price of MAMO on its Base lending market and used the inflated collateral to borrow real assets that it never repaid. The losses are estimated to be in the range of about $4 million to $9 million.
The attack drained cbBTC, USDC, wstETH, and ETH out of real depositor liquidity. Moonwell, a decentralized lending protocol, has suffered its third security incident in nine months. An attacker manipulated the price of the illiquid MAMO token on Moonwell’s Base lending market, driving its value up about eightfold from around $0.0105 to nearly $0.088 and allowing them to borrow real crypto assets like cbBTC, USDC, wstETH, and ETH against inflated collateral that was never repaid.
Moonwell suffers its third incident in nine months
The security firm ExVul says the attacker spent about $7 million buying MAMO to force the price up, then sold roughly $3.2 million of it back, taking a loss of close to $3.8 million on the token trades alone. The loss was a calculated cost that let the attacker borrow around $10 million in real assets from Moonwell, leaving a net haul of roughly $6 million. The Blockaid security firm first flagged suspicious activity against the mCBTC market, reporting an initial drain of 50.6 cbBTC, worth over $4 million.
The attacker’s wallet then moved most of the stolen funds, holding just over $4,600 hours later. Because the exploit was still unfolding, loss estimates shifted in real time. Blockaid’s early estimate was just over $4 million, the lowest figure, while ExVul put the loss at roughly 71.36 cbBTC, worth about $5.7 million. CertiK said the attacker’s address had collected close to $8.7 million, while others reported that $9 million had already been drained.
Meanwhile, the native governance token of Moonwell, WELL, initially spiked about 25% but later corrected downward by roughly 13% to around $0.0032. The company has about $72.77 million in total value locked, according to DeFiLlama, making the attack a significant blow to both the protocol and depositors. The Moonwell team acted quickly after the attack, cutting the MAMO market’s borrowing limit to the smallest possible amount (1 wei). The move basically stopped anyone from borrowing more against that token.
They also lowered the supply limits for both MAMO and WELL. The attack is currently under investigation. Before this incident, Moonwell had suffered two oracle-related failures. The first occurred in November 2025, when a spot-price manipulation classified as oracle manipulation occurred. On February 15, 2026, a separate $1.78 million bad-debt event occurred due to a misconfigured cbETH oracle that reported the asset at about $1.12 instead of roughly $2,200. The second incident drew more attention because the relevant code changes listed Anthropic’s Claude Opus 4.6 as a commit co-author, and that sparked a debate over AI-assisted “vibe coding” in DeFi.
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Bithumb secured its second first-instance judgment on Thursday, ordering a customer to return proceeds from bitcoin mistakenly credited in February.
The decision came one day after another ruling favored the exchange in a separate recovery claim. Two of its four lawsuits remain pending as smaller domestic competitors Coinone and Korbit introduce trading fee waivers.
Bithumb Court Decisions Advance Recovery Claims
Judge Kim Yu-seong of Seoul Central District Court’s Civil Division 90 upheld an unjust enrichment claim against a customer identified only as A. The single-judge case involved 194,000,443 won, the second-largest claim among the four lawsuits.
On August 26, the same court awarded Bithumb 4,989,990 won in another case. Both proceedings used public notice service, which deems documents served through posting when defendants’ addresses or workplaces cannot be located.
Claims involving 500 million won and 14.8 million won remain undecided. Bithumb sued four customers in March after they sold mistakenly credited bitcoin and retained the proceeds.
The February error occurred when an employee selected bitcoin instead of won while processing event rewards. Users received 620,000 BTC units, reportedly worth approximately $43 billion, exceeding the exchange’s actual bitcoin holdings, according to Cryptopolitan.
Financial authorities said Bithumb froze trading and withdrawals after discovering the mistake, recovering 618,214 units. However, 1,786 BTC had already been sold. On March 10, Bithumb told the National Assembly it had recovered 99% of 1,788 units outstanding at that stage.
Bitcoin Payout Error Prompts Regulatory Proposals
Following the incident, the Financial Services Commission (FSC) proposed continuous reconciliation systems comparing customer ledgers with exchange holdings every five minutes. Proposed safeguards also included automated verification and multiple approvals for manual transactions, including event rewards.
Separately, Cryptopolitan reported that identity-verification failures had resulted in a 36.8 billion won fine, approximately $25 million. Bithumb also received a six-month partial suspension, which it paused on May 1, allowing operations until a final ruling.
Bithumb Faces Competition From Fee Waivers
Coinone eliminated fees for trading every cryptocurrency listed on its platform and offered a renewable 30-day zero-fee voucher. Digital X, Korbit’s operator, waived won-market fees for one year through August 24, 2027.
Mirae Asset Consulting recently acquired more than 97% of Korbit, taking control of the exchange. Korea Investment & Securities, meanwhile, holds a 20% ownership stake in rival exchange Coinone.
This month, Coinone accounted for 2.39% of won-denominated trading volume, while Korbit held 0.52%. Upbit led with 68.11%, followed by Bithumb at 28.95%.
Bithumb recorded more than 2 trillion won in trading volume over 24 hours last Saturday. Bitcoin briefly traded above $80,000 during that period. The increase followed an 83.4% decline in the exchange’s operating profit during the first half of the year.
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Bitcoin reclaimed its short-term holder cost basis convincingly for the first time since April 2025, according to Look Into Bitcoin.
CoinGlass reported an August gain exceeding 25%, putting Bitcoin on course for its best August performance since 2017. The advance unfolded over 10 days, from $62,000 on August 17 to approximately $81,000 on August 25.
Bitcoin subsequently traded near $78,500, while resistance at its declining 50-week moving average continued to limit the broader recovery.
Bitcoin Moves Above Recent Holders’ Average Cost
Bitcoin crossed the Short-Term Holder Realized Price of $67,125 on August 19 and remained above that threshold afterward. At the reported price, Bitcoin stood approximately 17% above this cost basis, providing a buffer above the reclaimed threshold.
The metric measures the average cost basis of coins last moved within 155 days, representing what recent holders paid.
Prices below this threshold leave the cohort with unrealized losses, encouraging selling during rebounds as holders seek to recover costs. A sustained recovery above it puts those holdings into unrealized profit, changing the level’s role from resistance to support.
Bitcoin Ends Ten Months Below Holder Cost Basis
The previous convincing reclaim occurred in April 2025, weeks after Bitcoin reached approximately $75,000 during the tariff selloff.
Bitcoin remained above the threshold throughout that summer before falling decisively below it after the October 10 liquidation cascade. Recovery attempts subsequently failed until the latest breakout, leaving recent holders below their average purchase cost for roughly ten months.
Bitcoin briefly touched this cost basis in May but failed to hold it, reinforcing resistance before the latest breakout.
Look into Bitcoin’s historical examples, including the 2019 recovery, March 2020 crash, mid-2021, late 2022 lows, and periods through 2024. These recoveries have clustered near turning points, although identifying them retrospectively is easier and the full-cycle sample remains small.
Recent holders selling relief rallies four weeks ago now hold paper gains, changing their position during a 5% decline.
Bitcoin Faces Resistance at the 50-Week Moving Average
Bitcoin reached $81,265 this week, touching the 50-week moving average at $81,063 before closing approximately $2,300 beneath it.
The average supported repeated pullbacks during the 2024 and 2025 advance, but that relationship reversed after November 2025’s breakdown. It also acted as resistance during the extended declines of 2018 and 2022.
Its slope has continued falling since November, leaving the longer-term structure unchanged despite the short-term holder reclaim. Rejection at a declining long-term average remains consistent with an existing bearish structure.
A broader trend change requires a weekly close above $81,063, followed by the moving average flattening. Until those conditions occur, the reclaim near $67,000 remains the identified structural improvement, while weekly resistance remains intact.
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Roman Storm said court records show blockchain analytics firm Chainalysis operated a Tornado Cash relayer and collected fees in 2022.
The same company later helped United States prosecutors trace transactions and build their criminal case against the developer in federal court.
Chainalysis relayer role draws criticism
Relayers let mixer users withdraw funds without exposing wallet addresses. Storm argued that records from his case show Chainalysis provided this service for Tornado Cash and received fees.
“So the company that helped trace my ‘criminal’ transactions was itself profiting from Tornado Cash transactions, while I was prosecuted over software I helped create,” Storm wrote Tuesday on X.
He also criticized the continued prosecution. “Prosecutors are supposed to protect American interests and go after people who broke the law,” he wrote.
“A jury deadlocked on the two most serious counts against me. And still SDNY won’t stop, because this case was never just about me. It’s about setting an example.”
Retrial moves to April 2027
United States District Judge Katherine Polk Failla postponed Storm’s retrial from October 26, 2026, to April 26, 2027. A final pretrial conference is scheduled for April 20 at Manhattan’s Thurgood Marshall Courthouse.
The change followed an August 3 defense motion seeking 90 preparation days after Failla rules on Storm’s acquittal motion. Prosecutors opposed the adjournment, but Failla approved it while the motion and continuance request remain pending.
Storm filed the acquittal motion in September 2025, with oral arguments heard in April. No decision followed for roughly one year.
“My acquittal motion is still sitting there, undecided,” Storm wrote. “I honestly don’t know when this ends.”
Deadlocked charges return before jury
A Manhattan jury convicted Storm in August 2025 of conspiring to operate an unlicensed money-transmitting business. The offense carries a five-year maximum sentence.
Jurors could not reach verdicts on conspiracy to commit money laundering or violate United States sanctions. Prosecutors will retry both counts, carrying a potential 40-year sentence.
The Southern District of New York case began in August 2023 and has continued for three years. Storm was arrested in Washington state, pleaded not guilty, and received a $2 million recognizance bond. Co-founder Roman Semenov remains at large after being charged alongside him.
Supporters describe the prosecution as a test of whether writing code constitutes a crime. The Solana Policy Institute pledged $500,000 toward the Tornado Cash founders’ defense in 2025.
Ethereum co-founder Vitalik Buterin publicly supported Storm and called privacy “necessary for many parts of our society.”
Storm’s attorneys also cited a recent Supreme Court ruling involving internet provider Cox. That decision found Cox was not responsible for customers pirating music. The defense argued its reasoning should similarly protect developers from liability for how others use their software.
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Shinhan Visa stablecoin deal will test token issuance, transfers, and redemption through Visa’s established payment platform in South Korea.
The strategic agreement marks Shinhan Financial Group’s second stablecoin partnership within four months.
The companies signed the agreement on August 24 at Shinhan’s headquarters in central Seoul. Their pilot seeks to develop a business model suited to South Korea’s financial market. The pilot covers issuance, remittance, and redemption functions.
Visa Platform Supports Broader Payment Trials
The partnership will test stablecoins across issuance, person-to-person transfers, and conversion back into cash. Shinhan and Visa will also examine their use for settling card payments.
Further work will cover artificial intelligence-powered payment models and expanded business-to-business and business-to-consumer payment services. Shinhan plans to connect Visa’s global network with key subsidiaries, including Shinhan Bank, Shinhan Card, and Jeju Bank.
Jin Ok-dong, chairman of Shinhan Financial Group, described the agreement as an extension of the companies’ existing relationship. “Through this agreement, we have expanded our long-standing partnership with Visa to the broader digital finance sector,” he said.
He added that Shinhan intends to “deliver differentiated financial experiences to our customers.”
Shinhan Extends Recent Solana Initiatives
The Visa agreement follows an April memorandum between Shinhan Card and the Solana Foundation. That partnership involved testing stablecoin payments using Solana’s layer-one blockchain.
Shinhan’s asset management division then partnered with the Solana Foundation, Etherfuse, and Orca in early August. That project will test a tokenized fund denominated in South Korean won.
In July, Shinhan joined OpenUSD alongside Samsung Electronics, Dunamu, and ten other Korean companies. The 140-company initiative aims to standardize a dollar-backed payment token supported by Visa and Mastercard.
Discussions leading to the latest Visa agreement began in April, when executives from both companies considered closer cooperation. Shinhan reported quarterly net income of 1.82 trillion won, equivalent to roughly $1.3 billion.
Korean Stablecoin Rules Continue Taking Shape
Shinhan is developing these payment capabilities before South Korea formally authorizes their commercial use. Lawmakers are advancing the Digital Asset Basic Act, covering stablecoins, exchange licensing, and crypto exchange-traded products.
In December, lawmakers and regulators proposed limiting won-backed stablecoin issuance in South Korea to consortia. Under that plan, commercial banks must hold ownership stakes of at least 51 percent.
The proposal responded to Bank of Korea concerns that non-bank issuers could weaken monetary policy and deposit protection. Its bank-led structure would place established lenders at the center of won-token issuance.
Rival KB Financial completed its own won stablecoin pilot on the Kaia blockchain in May. That trial reduced cross-border transfer times to approximately three minutes.
Shinhan’s agreement with Visa now adds another payment infrastructure test while the legislative framework remains under consideration.
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Chinese AI startup Moonshot AI is reportedly in talks with U.S. cloud giants, Microsoft, Amazon, and Google, in a licensing arrangement that could include charging the companies as much as 30% of their revenue from reselling its open-weight Kimi K3 model.
Moonshot AI has already been in the news over a requirement that applies to any firm that sells the model as a service and earns more than $20 million a year. The AI firm is currently in early-stage negotiations with Microsoft, Amazon, and Google about revenue-sharing deals to host Kimi K3 on their cloud platforms, according to Reuters. Chinese AI startup Moonshot has announced that companies pulling in below $20 million in annual revenue can host Kimi K3 without owing Moonshot anything, but companies earning above that figure from reselling will shell out up to 30% of their revenue.
Moonshot AI reportedly in early-stage talks with US firms
AI researcher Rohan Paul recently raised concerns on X that Kimi K3’s terms are written to shield Moonshot’s own hosting business despite the fact that it ships with open weights. The terms dictate that large model-as-a-service providers need Moonshot’s permission before they can offer it, and very large applications built on the model are required to advertise Kimi K3. Private partner contracts can even add further commercial conditions.
Despite this, DigitalOcean’s chief executive Paddy Srinivasan confirmed that the company has reached a commercial arrangement with Moonshot. A regulatory filing last month revealed that Chinasoft International has entered a revenue-sharing agreement with Moonshot. However, the percentage remains undisclosed. Alibaba plans to require large commercial users of the open-weight version of its Qwen3.8-Max model to share revenue, although the rate is still under negotiation.
The company’s shares rose by 7% in Hong Kong after the Qwen3.8-Max announcement. The company’s shares faced a significant but unrelated decline on August 24, falling by up to 10% when it announced a large share placement to fund its AI development. Nvidia (NASDAQ: NVDA) also recently launched a revenue-sharing program that gives AI startups access to its hardware in exchange for a portion of the cloud revenue those partners generate. Sharon AI and Firmus Technologies are reportedly Nvidia’s first participants.
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Chinese lab Z.ai has been identified as the company behind Ox Alpha, the anonymous coding model. The model drew millions of developer queries on OpenRouter over the past week. The Chinese lab was credited with the creation of the coding model that has exploded in popularity over the past week, drawing millions of developers.
The model was released on OpenRouter on August 20, carrying no logo, no press release, and no company. The Ox Alpha listing boasted a massive context window of over a million tokens (1,048,576) that could handle text, images, and video, and spit out up to 131,072 tokens. Most models can only handle 8,000 to 200,000 tokens. Access to the model costs nothing. OpenCode, an open-source terminal agent, launched the model the same day and said it would stay free for a week, advertising provider capacity of 100 trillion tokens per day.
Z.ai released Ox Alpha on August 20
According to OpenRouter’s page, the mystery provider keeps prompts and completions but promises not to use them for training. Despite being completely anonymous for over a week, coding tools like Claude Code pushed billions of tokens of company code through it. Ox Alpha went viral when the first run a developer called Ben Davis completed put the model at 80% first-pass accuracy on a 10-task slice of the DeepSWE software-engineering benchmark, ahead of Claude Fable 5 at 65% and GPT-5.6-Sol at 52%.
Davis flagged the small sample himself. On a 10-task set, one task swings the score by 10 points. When he finished the full 113-task benchmark, Ox Alpha landed near 63%, roughly on the same level as GPT-5.6-Sol. However, no audited public leaderboard has posted a score. Stripe CEO Patrick Collison, whose company agreed on August 19 to acquire OpenRouter, tried the model and called it “very impressive” on X.
The first tool developers used to try to identify the source was tokenizer fingerprinting, which reads how a model splits text into the numeric units it processes. Researcher Joseph W. Elstner ran probe strings through Ox Alpha and, after adding the Z.ai new release GLM-5 vocabulary, matched all 95 of his probes with a mean error of zero. A separate developer, unclecode, built a fingerprinting tool called modelprint and found Ox Alpha lined up with GLM-5.3 on six of nine infrastructure probes.
A researcher named Chetaslua confirmed the model was running on Zhipu’s system after he sent a broken request to its server and received an error message that matches Zhipu AI’s official API documentation. A bad-role test also returned the same error that Z.ai’s GLM models produce. When the same weights were served by a different host, the error format changed, confirming the suspicion. Chetaslua rated the inference at 0.98 confidence. Z.ai, which was formerly Zhipu AI, also previewed its GLM-5 on OpenRouter anonymously, using the name Pony Alpha. GLM-5.3 shipped on August 14, six days before Ox Alpha appeared.
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LayerZero has introduced ATLAS, a headless exchange backend, with trading fees supporting ZRO buybacks and burns.
The token climbed more than 16% to $1.26 within 24 hours. ATLAS will direct 75% of fees remaining after venue rebates toward buying and burning ZRO.
ATLAS Converts Trading Revenue Into ZRO Demand
ATLAS, short for Aggregated Trading, Liquidity, and Settlement, applies one all-in fee per trade, then rebates the venue generating the volume.
Under Open ATLAS, rebates range from 20% to 65%. The amount depends on a venue’s trading volume and the quantity of ZRO it stakes.
A quarter of the post-rebate fee goes to market creators, while the remaining three quarters fund ZRO purchases and burns. This structure connects exchange activity with recurring token demand and gives venues a reason to lock ZRO supply.
LayerZero said venues must stake up to 1% of the ZRO supply to receive the highest rebate.
Venues Access Shared Trading Infrastructure
ATLAS has no consumer application or proprietary front end. Brokers, exchanges, and financial institutions can integrate the system into products while retaining their users, branding, and interfaces.
The backend combines trade matching, clearing, settlement, and risk management. This removes the need for each venue to build those functions or obtain them from a competing exchange.
Today, we’re announcing an initial slate of partners for Open ATLAS: @GTE_XYZ, @Bullish, @definedfi, and @get_truenorth. pic.twitter.com/CzV1DNDdTj
— LayerZero (@LayerZero_Core) August 25, 2026
Participants are divided into three roles. Venues operate customer-facing applications, market creators determine which assets trade, and market makers supply liquidity.
Supported markets can include spot tokens, perpetuals, stocks, bonds, commodities, memes, and prediction markets. LayerZero is also developing offerings for public crypto markets, prediction platforms, and institutions using customized trading rules.
“We built ATLAS to be the neutral, performant backend to power them all,” LayerZero co-founder and CEO Bryan Pellegrino said.
Zero Builds After Major Bridge Exploit
ZRO also secures Zero through delegated proof-of-stake, pays network gas fees, and supports governance voting. Staking remains the only route to ATLAS’s higher rebate levels.
LayerZero introduced the finance-focused zero-knowledge chain in February with Citadel Securities, DTCC, ARK Invest, and Intercontinental Exchange. ARK CEO Cathie Wood joined its advisory board, while ARK and Citadel purchased ZRO.
ATLAS is the first product built on Zero, according to strategy lead Jack Melnick, who previously worked at Berachain.
Several projects moved cross-chain operations to Chainlink after an April attack drained 116,500 rsETH, then worth about $292 million, from Kelp DAO’s LayerZero-enabled bridge. Chainalysis linked the exploit to North Korea’s Lazarus Group. Kelp later migrated routing to Chainlink and strengthened verification.
LayerZero said its OFT standard has processed over $290 billion across more than 160 blockchains. ATLAS launches later this year. ZRO later traded at $1.23, up 12.7% daily and 58.3% weekly, with $206.1 million in volume.
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Bitcoin sentiment reached extreme greed at 81, its highest reading since December 17, 2024. It returned after 616 days as Bitcoin gained more than 22% over seven days.
The index had stood at 36 one month earlier and 41 a week ago, both reflecting fear. CoinMarketCap called it the year’s fastest shift between sentiment extremes.
Sentiment Rebounds From February Capitulation
The gauge hit 5 on February 5, its 2026 low, signaling capitulation. Its climb to 81 within six months shows how rapidly market confidence recovered.
Alternative.me offered a cooler assessment. Its longer-running tracker remained in greed, with a reading about 6% below CoinMarketCap’s 81, although both measures showed the same overall upward direction.
The sentiment reversal followed a Bitcoin rally triggered by a United States Treasury announcement rather than an exchange-traded fund development. Treasury Secretary Scott Bessent doubled planned long-duration bond buybacks on Wednesday, raising the planned operations from $2 billion to at least $4 billion each.
Bessent told CNBC the following day that the eventual total could increase further. However, no funds had moved because the broader program runs from September 9 through November 4.
Treasury Signal Drives Bitcoin Rally
The announcement changed market expectations before affecting liquidity. Long-bond yields dropped within minutes after approaching a nearly two-decade high following weak demand for 30-year debt.
Bitcoin retained its advance as yields moved higher on Thursday. Roughly $3 billion in short positions were liquidated the next day, forcing purchases that accelerated the increase.
Bitcoin rose approximately 24% during the week, its strongest weekly gain since 2024, while outperforming the broader crypto market. CryptoQuant’s Bull Score climbed from 30 to 80, its highest since October 2025, as eight of ten indicators turned bullish.
CryptoQuant said the market had entered the early stages of a new bull market but stopped short of confirmation. It wants Bitcoin to close a week above its 365-day moving average near $83,000.
LMAX Group strategist Joel Kruger identified the May 2026 high of $82,820 as another threshold. A break above that level would confirm a cycle bottom for some observers and reopen the path toward $100,000.
Leverage and Whale Selling Raise Risks
Funding rates paid by leveraged long traders reached a 20-month high. Similar conditions preceded several sharper Bitcoin pullbacks during the previous two years, reflecting increased reliance on borrowed capital.
Short-term holder whales realized about $1.2 billion in profits between August 20 and August 22, CryptoQuant reported. That included a record $614 million on August 20.
Exchange inflows also reached roughly 53,000 BTC, their highest level since June. Traders’ unrealized profit margins rose to 20.5%, while Bitcoin previously dropped about 30% after the measure reached 19% in early May.
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Arthur Hayes says Scott Bessent is becoming Janet Yellen through Treasury liquidity. Arthur Hayes mentioned “Same Same But Different” with a night at Pacha. Scott, his “Buffalo Bill,” runs into Yellen. Yellen mocks him because his buyback increase calmed yields for only one session.
Arthur Hayes noted that Scott sounded different from Yellen, yet both reach for liquidity when Washington keeps spending, and Treasury yields push higher. Arthur wrote: “I saw that. Don’t let the haters get you down. The crypto community is with you. You had no choice; we love you. Keep it up! Don’t stop printing money because if the markets go down, there will be no free shit for all the rich people and everyone else in America who believes that if they believe hard enough in capitalism, they will get rich too. If there isn’t any free shit, then AOC is going to raise our taxes, oy vey.”
Arthur Hayes discusses the similarities
Arthur Hayes noted that starting in late 2023, Yellen sold more Treasury bills and fewer longer bonds. Bills mature within one year, so money-market funds treat them like cash. Those funds could use the Fed’s Reverse Repo Program (RRP), which pays rates near the federal funds rate. Treasury bills had to offer more yield because congressional funding fights can delay repayment. The RRP held about $2.5 trillion. More bill supply pushed yields enough to pull money-market cash out of the Fed. By January 20, 2025, when Scott took office, $100 billion remained.
Arthur Hayes counts the $2.4 trillion drop as liquidity released into markets. Bitcoin and the Nasdaq 100 rose, while the 10-year yield backed away from 5%. Arthur wrote: “If you don’t understand why Bitcoin and risk assets pumped even as the Fed held rates at the highest level since 2008 and simultaneously shrank its balance sheet, then you will miss the next bull market that just began. This is the reason academics coined the term Activist Treasury Issuance (ATI) to describe the sorcery Bad Gurl Yellen wielded.”
The 5% level matters because 10-year Treasuries feed into mortgages, corporate bonds and consumer credit. Arthur says both secretaries want financing costs below that point. The issue for Scott is federal debt issuance, and for Treasury, it is cheap funding. Bills can easily be marketed due to the desire of investors to get short-term, dollar-denominated instruments. Cryptocurrencies are linked with this trend via the USDT issued by Tether and the USDC by Circle Internet Group (NYSE: CRCL).
According to Arthur Hayes, the Federal Reserve can facilitate the demand through the reserves management program by making bank reserves as well as purchasing bills. He further states that the process is controlled by John Williams from the Federal Reserve of New York. Scott can sell off bills and then purchase back long-term securities using the proceeds. On August 19, Scott added $20 billion to planned long-end buybacks. Ten-year yields fell, and Bitcoin rallied for two days, but yields soon moved above their pre-announcement level.
Arthur Hayes says $20 billion is tiny against roughly $40 trillion of federal debt. Scott also backed wider FIMA use, letting foreign holders, including Japan, borrow Fed-created dollars against Treasuries instead of selling them.
“The best case for Bitcoin would be for Scott to announce a BOJ-style bond market manipulation where he informs the market he will conduct unlimited buy-backs of 10-year plus tenors if the yield is >5%. Initially, 10-year bonds would pump, and yields dump as the market showed Scott some fucking respect. But as with all uneconomical market manipulation schemes, the market will test Scott and see if he is ready to back up his words with a dollar bazooka,” Arthur Hayes said.
Arthur Hayes believes that small-scale buybacks will take place unless the stress level rises to become severe, and uses the MOVE Index level above 130 as one of the indicators. The Treasury could also empty its Treasury General Account of around $1 trillion for buying purposes. Arthur Hayes expects Bitcoin to keep rising but also sees violent pullbacks. He says non-full-time traders should avoid leverage and hold their crypto exposure while watching Scott’s liquidity moves.
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