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Nigeria has issued its first comprehensive guidelines on the taxation of virtual assets, providing long-awaited clarity on how cryptocurrency transactions and Virtual Asset Service Providers (VASPs) will be taxed under the country’s new regulatory framework. The guidance, released by the Nigeria Revenue Service (NRS), sets out how taxes will apply to crypto users, exchanges, brokers, custodians and other digital asset businesses operating in the country.
The guidelines classify virtual assets broadly to include cryptocurrencies, stablecoins, security tokens, utility tokens and non-fungible tokens (NFTs). They outline taxable events such as buying, selling, exchanging or disposing of digital assets, while also covering income earned from mining, staking, airdrops and other crypto-related activities. Gains from virtual asset transactions are treated as taxable income under Nigeria’s new tax laws.

TAXATION | Crypto Profits Will Be Subject to Personal Income Tax, Reveals Chairman of Nigeria Tax Reforms Committee

For VASPs, the framework introduces detailed compliance obligations. Exchanges and other licensed providers must register with the NRS, maintain detailed transaction records, file periodic tax returns and comply with customer identification and reporting requirements. They are also expected to keep records of customer transactions and provide information to tax authorities when requested.
The guidance also standardizes how digital assets should be valued for tax purposes. Virtual assets must generally be assessed using prevailing market prices from approved exchanges or other recognized valuation methods where market prices are unavailable. This is intended to reduce disputes over asset valuations and improve consistency in tax reporting.
The release follows Nigeria’s broader effort to establish a coordinated regulatory framework for digital assets. Earlier this year, the government introduced the Virtual Assets Executive Order, which allocated regulatory responsibilities among agencies including the Central Bank of Nigeria (CBN), the Securities and Exchange Commission (SEC) and the Nigeria Revenue Service (NRS), with the NRS tasked with developing specialized tax policies for the sector.


REGULATION | Nigeria Starts Implementing CARF Requirements by Tying Crypto Transactions to Tax and National IDs





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National Treasury and the South African Reserve Bank (SARB) hereby invite interested parties to submit written comments on the draft Crypto Assets Manual for cross-border activities (draft Manual).
This follows the publication of the draft Capital Flow Management Regulations, 2026 (draft Regulations) for public comment on 17 April 2026 and the joint media statement by National Treasury and the SARB on 15 May 2026, which addressed, among other matters, public concerns regarding the treatment, possession, and trading of crypto assets, including the potential regulation of cross-border crypto asset transactions. The joint statement further indicated that a separate cross-border crypto asset framework, in the form of a draft Manual, would be released for public comment to complement the draft Regulations.
The draft Manual should be read together with the draft Regulations as part of a broader effort to strengthen the oversight of cross-border financial activities and to address emerging risks associated with crypto assets.

1. ) Draft Crypto Assets Manual for Cross-Border Activities
2.) Exchange Control Circular No. 19/2026
3.) Annexure A – Comments on draft Crypto Asset Manual for cross-border activities

The proposed regulatory measures seek to minimise the risk of regulatory arbitrage between regulated entities conducting cross-border activities, and to enhance the ability of the Financial Surveillance Department (FinSurv) to detect, deter, and disrupt illicit financial flows. These measures will complement the existing regulatory oversight of crypto asset activities by the Financial Sector Conduct Authority, Financial Intelligence Centre and South African Revenue Service.

REGULATION | South Africa to Provide Clarity on Crypto Asset Transactions Activities Subject to Capital Controls

The draft Manual provides practical guidance on the implementation of the draft Regulations regarding crossborder crypto asset transactions, in particular the application and adjudication process to conduct the business of an Authorised Crypto Asset Service Provider (CASP), the permissions and conditions applicable to cross-border crypto asset transactions, details of related administrative responsibilities, and reporting requirements to FinSurv.
National Treasury and the SARB wish to emphasise that comments received on the draft Regulations during the public consultation process are currently being considered. Due to the release timing and the volume of the comments, this draft Manual has not yet taken into consideration the inputs already submitted in relation to the draft Regulations. The draft Regulations and draft Manual remain subject to refinement following the consideration of all public comments and stakeholder engagements.

REGULATION | Crypto Assets To Be Formally Incorporated into the South Africa Capital Flow Management

Reporting Cross-Border Crypto Asset Transactions to FinSurv
The draft Manual provides clarity on the point at which crypto asset transactions are regarded as crossborder in terms of the draft Regulations. The trigger point arises when crypto assets are transferred between a domestic Authorised CASP and an offshore CASP, or from a domestic Authorised CASP to a non-custodial wallet, resulting in a cross-border inflow or outflow that must be reported to FinSurv.
The above means that only individuals, at this stage, will be allowed to externalise crypto assets via Authorised CASPs in terms of their single discretionary allowance or foreign capital allowance.
Providing the trigger point ensures that crypto asset transactions giving rise to cross-border flows are consistently identified, appropriately reported and effectively monitored. The SARB has adopted an activity-based approach following research, testing and assessments of the benefits and risks.
It is important to note that, at this stage, this proposed approach neither distinguishes between different types of crypto assets, nor does it declare crypto assets an official currency in South Africa. The SARB is still undertaking research and consultations on other various aspects of crypto assets, and both local and global developments will be tracked closely to make appropriate future enhancements to the draft Manual.
Table 1 below indicates how different crypto asset transactions will be treated, including whether they must be reported to FinSurv.



REGULATION | South Africa’s Draft Capital Flow Management Regulations, 2026, to Demand Limited Crypto Holdings, Mandatory Resales




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Kenya has launched a blockchain-based platform for verifying academic credentials through the Kenya National Examinations Council (KNEC) moving more than 30 million examination records onto the Avalanche blockchain in a bid to curb certificate fraud and streamline verification.
According to Avalanche, the system enables employers, universities, and government agencies to instantly verify academic records without relying on paper certificates which have long been vulnerable to forgery. The platform is expected to reduce verification times while lowering administrative costs associated with manual checks.


The rollout builds on Kenya’s broader push toward digital identity infrastructure.
In October 2025, the Ministry of Information, Communications, and the Digital Economy said it was exploring Verifiable Credentials (VCs) and digital wallets to replace paper-based academic certificates with cryptographically secured digital records under internationally recognized standards. The initiative envisioned citizens storing and sharing academic qualifications through self-controlled digital wallets while allowing institutions to verify credentials in real time.

USE CASE | ‘Kenya Government Exploring Real World Use Cases of Verifiable Credentials and Digital Wallets,’ Says ICT Minister

While opening the Stakeholders Workshop on Verifiable Credentials, William Kabogo, Cabinet Secretary, Ministry of Information, Communications and the Digital Economy (MICDE), convened key participants from the Ministry of Information, Communications and the Digital Economy, Ministry of Education, and the Tony Blair Institute (TBI), among others.
Without mentioning the use of blockchain or distributed ledger technologies, the workshop focused on establishing a shared understanding of VCs and digital wallets, exploring real-world use cases, and aligning on a roadmap for the nationwide implementation of VCs.
The academic credential platform follows earlier pilot projects involving digital credential wallets and verifiable credentials for public services, positioning Kenya among a growing number of countries using blockchain technology to secure educational records and digital identity systems.


FRANCOPHONE AFRICA | The DRC Launches Blockchain-Based Platform to Tackle Fake Diplomas




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South Korean investors transferred a net $367 million in stablecoins from domestic crypto exchanges to overseas platforms in June 2026 extending a streak of monthly net outflows to 18 months, according to data from the Financial Supervisory Service.
Withdrawals to overseas exchanges totaled about $1.81 billion in June 2026 compared with inflows of about $1.44 billion, according to data submitted to lawmaker Lee Jong-wook.
The net outflow was equivalent to about 78% of South Korean retail investors’ $473 million in net purchases of overseas stocks during the month underscoring growing demand for offshore crypto trading and investment products unavailable on domestic exchanges.
Authorities have tightened oversight of foreign stablecoins, particularly U.S. dollar–pegged assets, in an effort to limit capital flight and reinforce monetary control. This has added friction to crypto liquidity while indirectly supporting domestic financial markets.

STABLECOINS | Stablecoin Balances Drop by Over 50% in Less Than One Year on South Korea Exchanges

Analysts and lawmakers say much of the stablecoin flow is being used to access offshore derivatives, including
leveraged crypto products and
tokenized versions of South Korean equities,
as well as dollar-denominated
decentralized finance (DeFi),
staking, and
real-world asset (RWA) services.
Stablecoins have recorded net outflows every month since January 2025.
In the second quarter, cumulative net outflows reached about $1.10 billion even as South Korean investors were net sellers of overseas stocks over the same period.
Lee called on the government to strengthen investor protection and accelerate regulatory reforms warning that more capital is shifting to overseas exchanges where domestic safeguards do not apply.


REGULATION | A South Korean Policy Report Proposes Stablecoin Oversight Ahead of the Digital Asset Basic Act




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Crypto venture capital participation has dropped to its lowest level in nearly six years with only 150 unique firms taking part in crypto funding rounds in July 2026 marking the weakest monthly activity since November 2020, according to CryptoRank data through July 28 2026.

The latest figures highlight how sharply the investor landscape has contracted since the previous bull market.


At its peak in May 2022, 1,177 unique investors participated in crypto funding rounds in a single month. July’s total represents an 87% decline reflecting the exit of many
smaller venture funds,
family offices, and
angel syndicates
that flooded the market during the 2021–2022 boom. In their place, a smaller group of established venture firms now dominates dealmaking.

The broader trend is also evident on a quarterly basis.

CryptoRank data shows that 651 firms participated in crypto funding rounds during the second quarter of 2026, down roughly 75% from the 2,564 firms that backed deals in the second quarter of 2022.

FUNDING | Crypto VC Funding Dropped by 74% in April 2026 Month-Over-Month

Fewer Investors, Larger Funds
The decline in the number of active investors does not necessarily mean less capital is flowing into the sector. Large venture firms continue to back infrastructure projects and real-world asset (RWA) initiatives. Earlier this year, Dragonfly closed its fourth fund at $650 million.

However, Dragonfly Managing Partner, Haseeb Qureshi, warned in February 2026 that crypto venture capital is facing a ‘mass extinction.’

He has argued that dedicated crypto VC firms could become obsolete by 2030 if a handful of dominant blockchain platforms continue to attract most users, liquidity, and developer activity, leaving fewer meaningful startups for specialist investors to fund.
The recent AI pivot by Paradigm, one of crypto’s largest native VCs, stands out.
The leading crypto venture capital firm recently raised a new $1.2 billion fund that will invest in artificial intelligence (AI), robotics, and other frontier technologies alongside digital assets underscoring how AI has become the technology sector’s hottest investment theme.

FUNDING | One of Crypto’s Largest Native VCs Raises Over $1 Billion to Expand into AI for the First Time

The move mirrors a wider shift across venture capital where several crypto-focused investors have expanded into AI as funding increasingly flows toward artificial intelligence startups. Firms including
Framework Ventures, and
Haun Ventures
have recently launched funds that combine crypto and AI investments.
Rather than chasing consumer applications or speculative tokens, investors are concentrating capital in mature infrastructure companies capable of supporting real-world financial activity. CryptoRank data shows late-stage funding rounds have surged while seed investment has slowed highlighting a preference for proven businesses with institutional traction over early-stage experimentation.

CASE STUDY | This Latest Funding Round Signals Where DeFi’s Next Growth Story May Come From

While July’s figures represent only a partial month and venture activity typically slows during the summer, the magnitude of the decline from the 2022 peak suggests the contraction is more than seasonal.
The key question is whether a sustained recovery in crypto markets or greater regulatory clarity in the United States can bring smaller investors back into the market, or whether crypto venture capital has entered a new era dominated by a handful of established firms setting valuations and leading most funding rounds.


REALITY CHECK | The Crypto Startup is Dying. Regulation Didn’t Kill it Alone




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Self-custodial crypto wallet, Ctrl Wallet, has shut down its core services leaving users scrambling to move their digital assets or back up recovery phrases after the company declined to specify an exact cut-off time for when the application would stop functioning.
Starting August 3 2026, users can no longer send or receive cryptocurrencies, swap tokens or connect to decentralized applications through the wallet. The only remaining feature is the ability to export a 12- or 24-word recovery phrase which can be imported into another compatible wallet to regain access to funds. Ctrl has warned that it cannot guarantee how long the app will remain accessible on users’ devices urging customers to export their recovery phrases immediately.

REALITY CHECK | BitMart, Once a Top Altcoin Exchange, to Shut Down After Nearly a Decade

The shut-down follows a security incident disclosed on June 23 2026 that affected a small number of Cardano-linked wallets. While the company initially placed parts of the platform into maintenance mode, it later opted to discontinue the wallet entirely rather than continue operations after the exploit.
Formerly known as XDEFI Wallet, Ctrl rebranded in July 2024 as part of a broader push to become a universal self-custody wallet. The platform grew to support more than 2,500 blockchain networks and reported more than 650,000 monthly users, positioning itself as one of the larger multi-chain browser wallets competing with MetaMask and Phantom.

MILESTONE | ColdCard Hack Triggers Largest Small Bitcoin Transfer Surge Since FTX Collapse

Key milestones in the wallet’s history include
its launch as XDEFI Wallet to serve decentralized finance users across multiple blockchains,
its 2024 rebrand to Ctrl Wallet, and
its April 2026 integration into the Emurgo ecosystem, where its multichain technology was set to continue through the SecondFi wallet.
That transition was followed by the June 2026 Cardano-related exploit and the July 2026 announcement that the wallet would be permanently discontinued.
Ctrl has also warned users that there is no migration token, airdrop, refund or compensation program tied to the closure cautioning against scams claiming to offer ways to recover funds. Users who have backed up their recovery phrases can still access their assets by importing them into another compatible self-custody wallet.

REALITY CHECK | ~80% of Crypto Projects Don’t Bounce Back After a Hack




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Luno users in several European countries who missed the exchange’s June 2026 deadline to transfer crypto to external wallets can now only liquidate their holdings before the platform shuts down local operations or risk seeing dormant balances eroded by monthly inactivity fees.

The exchange disabled crypto sends for affected customers on June 29 2026 as part of a phased withdrawal from the European Union.

REGULATION | Binance Users in Europe Can Now Transfer and Withdraw Crypto Assets Following MiCA License Denial

Users can no longer transfer digital assets to another exchange or self-custody wallet leaving them with only one option:
Sell their crypto and withdraw fiat to a linked bank account by August 31 2026.


Luno announced in early 2026 that it would discontinue services for customers in several EU markets citing a strategic decision to refocus on Africa and Southeast Asia.

REALITY CHECK | South African Crypto Exchange, Luno, to Cut 20% Workforce in Strategic Institutional Pivot
The restructuring comes as South African crypto exchange volume tanks. @LunoGlobal and @VALRdotcom, with about 99% transaction volume in South Africa, used to trade, on… pic.twitter.com/dpY0SYYwU5
— BitKE (@BitcoinKE) July 30, 2026
The wind-down began on June 1 2026 when
deposits,
crypto purchases, and
incoming transfers were disabled.
Crypto withdrawals remained available only until June 29 2026.
Luno says it will disable selling and withdrawals by August 31 2026.


Customers who fail to withdraw funds before the August 31 2026 deadline will have their accounts closed on September 1 2026.

REGULATIONS | OKX Prompting Users to Convert USDT to USDC Amid MiCA Requirements

Luno said balances exceeding the equivalent of $10 will require manual withdrawal through customer support while the company reserves the right to charge monthly dormancy fees on funds it continues to hold from September 2026 onward.
The policy has drawn criticism from some users because those who missed the crypto transfer deadline are effectively forced to sell their holdings rather than move them to another wallet, potentially triggering taxable events or forcing sales at unfavorable market prices.
Luno said users with dual citizenship in a country where it still operates may be eligible to retain access by re-verifying their accounts with documentation from that jurisdiction. Existing rewards and pending referral payouts will also be credited before accounts are closed.


REGULATION | Europe’s Crypto Market is About to Look Very Different




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Tether reported a net operating profit of $1.5 billion in the second quarter, driven by returns from its U.S. Treasury and repurchase agreement portfolio while maintaining a $4.11 billion reserve buffer above liabilities and expanding its physical gold holdings to more than 146 metric tons.
The issuer of the world’s largest stablecoin said it added 14 metric tons of gold during the quarter bringing its bullion holdings to about $18.8 billion while also increasing its Bitcoin reserves to 98,933 BTC. It reduced secured lending exposure by about 15% during the period as it continued to shift reserves toward more liquid assets.

MILESTONE | Tether is Now One of the Largest Holders of Gold Globally

USDT circulation rose to $184.6 billion by the end of June 2026 despite a contraction in the broader stablecoin market lifting Tether’s market share above 60%, according to the company. Assets totaled $187.75 billion against liabilities of $183.64 billion, leaving excess reserves of $4.11 billion.
The latest results extend a year of strong earnings for Tether.
The company generated an estimated $13.7 billion in profit during 2025 buoyed by elevated interest income from its Treasury portfolio and has continued to post robust quarterly results in 2026 despite increased market volatility. In the first quarter, Tether also reported strong profitability before adding another $1.5 billion in operating profit in Q2 2026 underscoring the resilience of its reserve strategy.
Tether CEO, Paolo Ardoino, said the second quarter demonstrated the resilience of Tether’s reserve strategy during periods of heightened volatility in gold and Bitcoin markets with the company remaining “fully backed” while continuing to rank among the world’s largest buyers of U.S. Treasuries.


MILESTONE | Tether is Now One of the Largest Holders of Gold Globally





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Bitcoin holders moved nearly 40,000 BTC in transactions of less than 1 BTC following the ongoing ColdCard wallet exploit marking the largest daily movement by smaller holders since the collapse of FTX in November 2022, according to CryptoQuant.
CryptoQuant Head of Research, Julio Moreno said 39,600 BTC were transferred on July 31 2026, just shy of the 39,900 BTC moved on November 16 2022, days after FTX filed for bankruptcy.

“The Bitcoin plebs had not moved this amount of BTC in a day since the FTX collapse,” he wrote,
“39.6K BTC transferred on July 31st after the coldcard hack, 39.9K BTC transferred on November 16 2022, a few days after the FTX collapse.
These are Bitcoin transfers < 1 BTC,” adding that it was encouraging to see users “taking action” to secure their funds.

The $90 million ColdCard $BTC wallet drain sees #Bitcoin drop as small holders seek refuge on centralized exchanges.
The incident has become one of the #LARGEST ATTACKS ever targeting BITCOIN SELF CUSTODY through cryptographic key generation rather than malware, phishing or… pic.twitter.com/wqPL7eQUMa
— BitKE (@BitcoinKE) August 3, 2026
The spike comes as the suspected ColdCard exploit continues to expand.
Researchers now estimate the attack has unfolded across three coordinated waves, with about 1,367 BTC stolen from roughly 4,585 addresses worth nearly $89 million at current prices. The incident has become one of the largest failures of Bitcoin self-custody in recent years prompting thousands of users to move funds to new wallets or centralized exchanges as a precaution.

CASE STUDY | Bitcoin Cold Wallet Exploit Spreads to 4,500 Addresses as Losses Climb to ~$90 Million

The exploit stems from a firmware flaw that generated predictable wallet seeds on affected ColdCard devices manufactured between 2021 and 2025. Because the vulnerability allowed attackers to mathematically reconstruct private keys without physical access to the hardware wallet, security researchers say it represents a fundamentally different type of hardware wallet failure from conventional phishing or malware attacks.
The incident has reignited debate over Bitcoin self-custody with some users arguing that properly generated offline wallets remain the safest way to hold Bitcoin while others have shifted assets to custodians or spot Bitcoin ETFs following the breach.


CASE STUDY | Why This Cold Wallet Exploit Exposes a Big Bitcoin Hardware Security Vulnerability




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Tokenized stock trading volumes surged to a record in July, but nearly all of the growth came from a single tokenized Nasdaq-100 ETF underscoring how concentrated activity remains in the fast-growing market for on-chain equities.
Monthly on-chain trading volume for tokenized equities jumped 288% to $11.3 billion in July 2026, nearly four times June 2026’s previous record. However, Binance’s bStocks platform accounted for 83.3% of total trading volume, or $9.41 billion, with almost the entire amount generated by tokenized QQQ, which alone recorded $9.27 billion in trades.

LIST | Here Are 5 Verticals Driving Real-World Assets Tokenization in 2026

While QQQ dominated activity, the report shows trading was far more modest across other assets. Excluding QQQ,
tokenized Nvidia (NVDA) was the second-most traded underlying with $630 million, followed by
Micron (MU) at $252 million,
SPCX at $223 million,
SPY at $132 million, while newly listed
Circle (CRCL) generated $114 million and
GameStop (GME) recorded $67 million
in volume.

MILESTONE | Tokenized Trading Volume Hits Record High in June 2026 with SpaceX IPO Driving 1/3 of the Total

The surge in trading coincided with strong growth in the broader tokenized equities market.

The market capitalization of tokenized public equities climbed 50.3% during July 2026 to a record $2.26 billion marking a 4th consecutive month of expansion and almost doubling from $1.17 billion at the start of 2026. Tokenized equities now account for 7.1% of the overall $32.1 billion tokenized real-world asset (RWA) market whose capitalization increased 11.5% in July 2026 to a new all-time high.

The report also highlights a sharp shift in market leadership.

Ondo remained the largest issuer with $612 million in tokenized equities, but its market share fell from 44% to 27% as competition intensified.
Binance bStocks was the fastest-growing platform, with market capitalization surging 195.2% to $409 million, while
Securitize expanded 121.8% to $346 million. Meanwhile,
xStocks grew to $464 million, but its market share declined to 20.5% reducing the combined dominance of Ondo and xStocks from 71.2% in June to 47.5% in July 2026.

INSTITUTIONAL | Securitize Becomes the First Publicly-Traded Company to Tokenize Own Stock on First Day of Trading

The report attributed the broader market expansion to several institutional developments during the month, including DTCC’s live production launch of tokenized Microsoft, Circle, and ETF shares on July 15 2026 as well as Robinhood Chain’s debut which introduced another distribution channel for tokenized equity settlement using USDG.

TOKENIZATION | Robinhood Chain’s Tokenized Assets Surge 5x as OnChain Stock Trading Accelerates

Competition among trading venues also shifted significantly.


xStocks, which led the market in June 2026 with a 53.1% share ($1.55 billion), dropped to 4th place in July 2026 with just $335 million (3%).
Robinhood entered the rankings for the first time with $280 million (2.5%), while
Ondo ($792 million) and
Backpack ($479 million) maintained relatively stable trading volumes but lost market share as
Binance’s QQQ product dominated activity.
The July 2026 data suggests that while tokenized equities are growing rapidly, much of the record trading activity remains concentrated in a single product rather than reflecting broad-based adoption across tokenized stocks.
At the same time, market capitalization continues to diversify as new issuers, trading venues, and institutional infrastructure enter the sector.


EXPERT OPINION | Tokenization Alone Will Not Fix Illiquid Assets, Say Industry Experts




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Losses tied to the ColdCard hardware wallet vulnerability have climbed to nearly $89 million with attackers expanding the campaign to 4,585 Bitcoin addresses across three waves of coordinated thefts, according to Galaxy Research.
The latest sweep brings the total stolen to 1,367 BTC, up from roughly 1,083 BTC ($70 million) reported a day earlier.
The attack first emerged on July 30 when hackers drained about 594 BTC from nearly 500 wallets in what initially appeared to be an isolated incident. Hours later, a much larger second wave swept more than 1,196 wallets, pushing losses past $70 million and revealing that the exploit was targeting wallets created with vulnerable versions of Coldcard firmware rather than compromising the devices themselves.

BITCOIN | ~500 Bitcoin Hardware Wallet Addresses Get Drained of ~$40 Million

The newly identified third wave suggests the campaign is still evolving.
Unlike the earlier attacks which consolidated stolen bitcoin into a handful of collector wallets, the latest operation sends funds from each victim to separate destination addresses and stores them in pay-to-witness-script-hash (P2WSH) outputs, a more sophisticated approach that may complicate blockchain analysis.
Researchers say the exploit stems from a firmware build configuration that caused affected Coldcard devices to generate wallet seeds using predictable hardware values instead of the device’s dedicated hardware random-number generator. Because every Bitcoin private key is derived from that seed, attackers who can recreate it can derive the same wallet and sweep funds without ever touching the physical device.

The incident has become one of the largest attacks ever targeting Bitcoin self-custody through cryptographic key generation rather than malware, phishing or exchange breaches. It has also highlighted a unique supply-chain risk:
users who securely stored offline wallets for years remained vulnerable if the wallet was originally created with the affected firmware, regardless of whether the device was later updated.

Galaxy Research warns that the growing number of affected addresses indicates attackers are continuing to identify vulnerable wallets suggesting the total losses could rise further as additional weak seeds are reconstructed and exploited.



CASE STUDY | Why This Cold Wallet Exploit Exposes a Big Bitcoin Hardware Security Vulnerability




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The theft of more than 1,000 BTC worth about $70 million from vulnerable Coldcard Bitcoin wallets marks one of the most significant hardware wallet compromises to date because attackers never needed physical access to the devices or users’ recovery phrases.
Researchers now estimate that 1,082.65 BTC was stolen from 1,196 wallets in a coordinated sweep that lasted just 41 minutes on July 30, nearly doubling the initial estimate of 594 BTC. Galaxy Research said the funds were drained across six Bitcoin blocks, with wallets emptied in rapid succession.

BITCOIN | ~500 Bitcoin Hardware Wallet Addresses Get Drained of ~$40 Million

Unlike most hardware wallet attacks, which rely on users revealing their seed phrases, installing malicious firmware, or handing over their devices, this exploit targeted the wallet creation process itself. A firmware bug introduced in March 2021 caused affected Coldcard Mk3 devices to generate recovery seed phrases using predictable software-based randomness instead of the device’s secure hardware random number generator.
That meant attackers could mathematically reconstruct victims’ private keys remotely without ever touching the hardware wallets, making it one of the rare cases where a flaw in the wallet’s entropy generation – not user error or phishing – led directly to large-scale theft.

CASE STUDY | Why This Decentralized Protocol is Giving Top Priority to Operational Security

How the Attack was Executed
1.) A new wallet is created. During setup, the Coldcard hardware wallet is supposed to generate a cryptographically secure random number. This number, known as the seed, forms the foundation of the wallet’s security.

2.) The seed is used to generate all wallet credentials. Every private key, public key, and cryptocurrency address the wallet will ever create is mathematically derived from this seed using standardized, publicly known algorithms. As long as the seed remains unpredictable, the wallet remains secure.

3.) Coldcard is designed to use a hardware random number generator. Under normal operation, the wallet’s firmware obtains entropy from a dedicated hardware random number generator (RNG), producing a seed that is effectively impossible to predict or reproduce.

4.) A firmware build configuration disables the hardware RNG. An internal build setting mistakenly instructs the firmware to bypass the hardware random number generator during wallet creation.

5.) A software validation bug fails to detect the problem. Instead of checking whether the hardware RNG was actually enabled, a supporting software library only checks whether the configuration option exists. Because of this flawed validation, the firmware proceeds without raising any errors.

6.) The wallet falls back to a weaker software-based source of randomness. Rather than using unpredictable hardware entropy, the firmware generates the seed using a basic software routine.

7.) The substitute randomness relies on predictable device information. The software routine is seeded using:
the device’s factory-assigned serial number, which never changes, and
the chip’s clock registers, whose values can be estimated or reproduced by an attacker using another device.

8.) The number of possible wallet seeds drops dramatically. Instead of selecting from an astronomically large number of possible seeds, the wallet can only generate a much smaller, finite set.
On older Coldcard Mk2 and Mk3 devices, researchers found the seed generation could be determined outright.
On Mk4, Q, and Mk5 models, the possible seed space was reduced to roughly 4 billion combinations.

9.) Attackers generate every possible seed offline. Because four billion possibilities are well within the capabilities of modern computers, an attacker can systematically generate every candidate seed on their own hardware.

10.) Each candidate seed is converted into wallet addresses. For every generated seed, the attacker derives all corresponding cryptocurrency addresses using the same public derivation standards used by the wallet.

11.) The attacker compares the generated addresses against the blockchain. Since blockchain addresses and balances are public, the attacker checks whether any generated address matches an address holding cryptocurrency.

12.) No interaction with the victim’s wallet is required. The entire attack is performed offline. The victim’s Coldcard never needs to be connected to the internet, unlocked, or physically accessed. It could remain powered off in a safe while the attacker performs the search elsewhere.

13.) The attacker repeats the process across multiple address formats. According to Galaxy’s analysis, compromised wallets included:
1,183 using modern Native SegWit addresses,
7 using older SegWit addresses, and
6 using legacy address formats.

14.) The pattern indicates automated enumeration rather than targeted attacks. Instead of attacking individual victims, the attacker systematically tested every possible seed and every address derivation path until matching funded wallets were found.

15.) The search can continue indefinitely. Because the attack is entirely offline, the attacker can pause, expand, refine, and resume the enumeration process at any time, increasing the likelihood of discovering additional vulnerable wallets.



The incident challenges one of Bitcoin’s core security assumptions:
that hardware wallets provide strong protection as long as users keep their recovery phrases offline.

In this case, the wallets themselves generated weak seed phrases, rendering even properly stored devices vulnerable years after they were created.

The flaw affects only Coldcard Mk3 wallets created using firmware version 4.0.1 or later during the affected period while newer Coldcard models are not believed to be impacted. The attack highlights how even trusted hardware security can be undermined if cryptographic randomness fails at the point a wallet is created.


CASE STUDY | Why This Decentralized Protocol is Giving Top Priority to Operational Security




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The theft of more than 1,000 BTC worth about $70 million from vulnerable Coldcard Bitcoin wallets marks one of the most significant hardware wallet compromises to date because attackers never needed physical access to the devices or users’ recovery phrases.
Researchers now estimate that 1,082.65 BTC was stolen from 1,196 wallets in a coordinated sweep that lasted just 41 minutes on July 30, nearly doubling the initial estimate of 594 BTC. Galaxy Research said the funds were drained across six Bitcoin blocks, with wallets emptied in rapid succession.

BITCOIN | ~500 Bitcoin Hardware Wallet Addresses Get Drained of ~$40 Million

Unlike most hardware wallet attacks, which rely on users revealing their seed phrases, installing malicious firmware, or handing over their devices, this exploit targeted the wallet creation process itself. A firmware bug introduced in March 2021 caused affected Coldcard Mk3 devices to generate recovery seed phrases using predictable software-based randomness instead of the device’s secure hardware random number generator.
That meant attackers could mathematically reconstruct victims’ private keys remotely without ever touching the hardware wallets, making it one of the rare cases where a flaw in the wallet’s entropy generation – not user error or phishing – led directly to large-scale theft.

CASE STUDY | Why This Decentralized Protocol is Giving Top Priority to Operational Security

How the Attack was Executed
1.) A new wallet is created. During setup, the Coldcard hardware wallet is supposed to generate a cryptographically secure random number. This number, known as the seed, forms the foundation of the wallet’s security.

2.) The seed is used to generate all wallet credentials. Every private key, public key, and cryptocurrency address the wallet will ever create is mathematically derived from this seed using standardized, publicly known algorithms. As long as the seed remains unpredictable, the wallet remains secure.

3.) Coldcard is designed to use a hardware random number generator. Under normal operation, the wallet’s firmware obtains entropy from a dedicated hardware random number generator (RNG), producing a seed that is effectively impossible to predict or reproduce.

4.) A firmware build configuration disables the hardware RNG. An internal build setting mistakenly instructs the firmware to bypass the hardware random number generator during wallet creation.

5.) A software validation bug fails to detect the problem. Instead of checking whether the hardware RNG was actually enabled, a supporting software library only checks whether the configuration option exists. Because of this flawed validation, the firmware proceeds without raising any errors.

6.) The wallet falls back to a weaker software-based source of randomness. Rather than using unpredictable hardware entropy, the firmware generates the seed using a basic software routine.

7.) The substitute randomness relies on predictable device information. The software routine is seeded using:
the device’s factory-assigned serial number, which never changes, and
the chip’s clock registers, whose values can be estimated or reproduced by an attacker using another device.

8.) The number of possible wallet seeds drops dramatically. Instead of selecting from an astronomically large number of possible seeds, the wallet can only generate a much smaller, finite set.
On older Coldcard Mk2 and Mk3 devices, researchers found the seed generation could be determined outright.
On Mk4, Q, and Mk5 models, the possible seed space was reduced to roughly 4 billion combinations.

9.) Attackers generate every possible seed offline. Because four billion possibilities are well within the capabilities of modern computers, an attacker can systematically generate every candidate seed on their own hardware.

10.) Each candidate seed is converted into wallet addresses. For every generated seed, the attacker derives all corresponding cryptocurrency addresses using the same public derivation standards used by the wallet.

11.) The attacker compares the generated addresses against the blockchain. Since blockchain addresses and balances are public, the attacker checks whether any generated address matches an address holding cryptocurrency.

12.) No interaction with the victim’s wallet is required. The entire attack is performed offline. The victim’s Coldcard never needs to be connected to the internet, unlocked, or physically accessed. It could remain powered off in a safe while the attacker performs the search elsewhere.

13.) The attacker repeats the process across multiple address formats. According to Galaxy’s analysis, compromised wallets included:
1,183 using modern Native SegWit addresses,
7 using older SegWit addresses, and
6 using legacy address formats.

14.) The pattern indicates automated enumeration rather than targeted attacks. Instead of attacking individual victims, the attacker systematically tested every possible seed and every address derivation path until matching funded wallets were found.

15.) The search can continue indefinitely. Because the attack is entirely offline, the attacker can pause, expand, refine, and resume the enumeration process at any time, increasing the likelihood of discovering additional vulnerable wallets.



The incident challenges one of Bitcoin’s core security assumptions:
that hardware wallets provide strong protection as long as users keep their recovery phrases offline.

In this case, the wallets themselves generated weak seed phrases, rendering even properly stored devices vulnerable years after they were created.

The flaw affects only Coldcard Mk3 wallets created using firmware version 4.0.1 or later during the affected period while newer Coldcard models are not believed to be impacted. The attack highlights how even trusted hardware security can be undermined if cryptographic randomness fails at the point a wallet is created.


CASE STUDY | Why This Decentralized Protocol is Giving Top Priority to Operational Security




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Canadian hardware wallet maker, CoinKite, has urged users of its Coldcard Mk3 devices to move their Bitcoin to new wallets after identifying a flaw in seed phrase generation that may have contributed to the possible theft of 594.48 BTC, worth about $38 million.
The company said the issue affects wallets created on Mk3 devices running firmware versions 4.0.1 through 5.0.3. Newer Mk4, Q and Mk5 devices are not believed to be affected. Coinkite said it has not confirmed a link between the flaw and the theft but advised users to migrate funds as a precaution.
The warning follows the coordinated sweep of nearly 600 BTC from about 500 wallets in under 30 minutes, with security researchers suggesting a weakness in the affected firmware may have produced predictable seed phrases that attackers could exploit.
Out of the total Bitcoins drained, 562 BTC was later consolidated into one address.


MILESTONE | Q2 2026 Becomes the Most Active Quarter on Record by Number of Crypto Hacks




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The Bank of Italy has challenged one of the biggest claims surrounding stablecoins finding that they do not consistently offer lower costs than traditional remittance services.
In a new study, researchers conducted a ‘mystery shopping’ exercise involving 200 USDC transfers across 10 remittance corridors linking Italy with Argentina, Brazil, South Africa, the United Arab Emirates, and Japan. The findings showed that while stablecoin transfers can be cheaper in some corridors, they do not provide a systematic cost advantage over conventional money transfer services.

STABLECOINS | Stablecoins Not Efficient in Strengthening International Role of the Euro, Says President of European Central Bank

The study said that to properly evaluate the systemic impact of stablecoins, a recent and rapidly expanding strand of economic literature has moved beyond theoretical debates and focused instead on the empirical dissection of the stablecoin ecosystem. This empirical turn has developed along distinct but interconnected dimensions.
Three of them are particularly relevant:
1.) The geographical localization of cross-border stablecoin flows,
2.) The rigorous quantification of genuine economic activity (i.e. isolating transactions that more closely resemble payment activity by excluding non-economic on-chain flows, such as bot-driven activity, high-frequency trading and intra-exchange transfers, prevalent on general-purpose blockchains), and
3.) The granular assessment of end-to-end transactional efficiency.
The study found that total transfer costs ranged from as little as 0.3% to nearly 9% of the amount sent, depending on the remittance corridor and the service providers used. Researchers attributed the wide variation primarily to fiat on- and off-ramp costs, exchange rate spreads, and withdrawal fees, rather than blockchain settlement costs.

The report notes:
“Stablecoins show no systematic cost advantage over traditional channels . . . On and off‑ramp frictions are the main source of cost and transfer duration.”

To benchmark the results, the Bank of Italy compared stablecoin transfers with Wise across the same payment corridors.


Stablecoins proved cheaper for transfers from
Italy to Argentina,
Italy to South Africa, and
Brazil to Italy.
However, they were more expensive on routes including
Argentina to Italy,
Italy to Brazil, and
transfers between Italy and the UAE.
To address this limitation, the table below compares stablecoin transfer costs with those charged by Wise on the same bilateral corridors and for the same transaction amount, thereby allowing a more granular corridor-level assessment.18 The USDC transfers and the Wise simulations were conducted on different dates (25 – 26 March and April 14, 2026, respectively).


The most striking finding is the enormous variance across corridors: total costs range from 0.30% for the ITA→ARG transfer to 8.96% for the reverse ARG→ITA corridor. This range alone, spanning from well below the 3% G20/UN SDG target to far above the current global average, illustrates the difficulty of generalizing about stablecoin efficiency.


The research also found that blockchain settlement itself typically took between 15 and 20 minutes, but the overall transfer time depended heavily on local payment infrastructure. Countries with instant payment systems, such as Italy and Brazil, processed deposits and withdrawals in less than a minute, while jurisdictions relying on traditional bank transfers, including South Africa, experienced delays of up to two business days.


“As a consequence, the speed advantage associated with stablecoin settlement disappears in this corridor, as the total transaction time becomes comparable to that of traditional bank transfers,” the researchers wrote.

The report concludes that stablecoins alone do not guarantee faster or cheaper remittances and instead depend on efficient traditional payment infrastructure to deliver meaningful benefits.


CBDC | The European Central Bank to Cut Digital Euro Rollout Costs by Re-Using Existing Payment Frameworks and Standards




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Trading in perpetual futures tied to tokenized real-world assets (RWAs) has surged to nearly match Bitcoin perpetual futures volumes on crypto exchanges Hyperliquid and Binance, underscoring growing investor demand for blockchain-based exposure to traditional financial assets.
RWA perpetual futures, which track tokenized stocks, equity indices and commodities, reached 99.2% of Bitcoin perpetual futures trading volume over the past week across the two exchanges, according to digital asset infrastructure provider, Talos.

The rapid growth marks a significant shift for crypto derivatives markets where Bitcoin has historically dominated trading activity.

Just months ago, RWA-linked perpetuals represented only a small fraction of overall volumes, but demand has accelerated as exchanges expanded listings tied to U.S. equities, commodities and major stock indices.
The trend follows a broader push to bring traditional financial assets on-chain.

REGULATION | United States SEC Clears World’s Second Largest Stock Exchange for Tokenized Securities

Tokenized RWAs – including stocks, bonds, commodities and private credit – have become one of the fastest-growing segments of digital assets as financial institutions and crypto firms seek to bridge traditional finance with blockchain infrastructure.
Hyperliquid has emerged as a key venue for the new products after introducing perpetual contracts linked to tokenized real-world assets while Binance has also expanded its derivatives offerings to capture growing demand for around-the-clock trading of traditional market exposure.
Tokenized real-world assets (RWAs) have become the largest trading category on decentralized derivatives exchange, Hyperliquid, for the first time overtaking cryptocurrency perpetuals in a milestone that underscores the rapid growth of on-chain traditional finance.
INSIGHTS | Why Real-World Assets (RWAs) Became the Largest Trading Category on the Leading DEX

DTCC, which clears and settles the vast majority of U.S. securities trades, said tokenized assets custodied through its Depository Trust Company could become available on Stellar in the first half of 2027. The initiative will initially focus on highly liquid assets including U.S. Treasuries, exchange-traded funds, and equities tied to major indexes.

INSTITUTIONAL | World’s Largest Clearing, Settlement Organization by Transaction Value to Connect Tokenized Securities to Stellar

In March 2026, the U.S. Securities and Exchange Commission approved a rule change allowing Nasdaq to introduce trading and settlement of tokenized securities marking a major step toward integrating blockchain into traditional capital markets.

REGULATION | United States SEC Clears World’s Second Largest Stock Exchange for Tokenized Securities
The Nasdaq (National Association of Securities Dealers Automated Quotations) is the world’s second-largest stock exchange, founded in 1971 as the first electronic,… pic.twitter.com/zhDRCE1XNn
— BitKE (@BitcoinKE) March 19, 2026
The surge in RWA derivatives suggests traders are increasingly using crypto-native infrastructure to gain leveraged exposure to traditional financial markets highlighting how tokenization is evolving beyond spot assets into one of the industry’s fastest-growing derivatives segments.

LIST | Here Are 5 Verticals Driving Real-World Assets Tokenization in 2026




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Strategy, the world’s largest corporate holder of bitcoin, reported a second-quarter net loss of $8.2 billion after a decline in the cryptocurrency’s price triggered a sharp markdown in the value of its digital asset holdings under fair-value accounting.

The report reveals a 25% growth in bitcoin holdings in 2026.


The loss was driven almost entirely by an $8.32 billion unrealized markdown on the company’s bitcoin holdings, reflecting weaker prices during the April-June 2026 period. Under accounting rules adopted in 2025, companies must mark digital assets to market each reporting period making earnings more sensitive to bitcoin price swings.
Strategy ended the quarter holding 843,775 bitcoin, currently valued at about $54.8 billion, compared with a cumulative acquisition cost of $63.7 billion. The company has raised $17.06 billion in 2026 so far through stock offerings while repurchasing $1.5 billion of convertible notes at a discount.

MILESTONE | Strategy Surpasses 800, 000 Bitcoins After a Record Purchase

Despite the accounting loss, the company has continued to strengthen its balance sheet, building a $3.75 billion U.S. dollar reserve which it said is sufficient to cover more than two years of preferred dividends and interest payments. Strategy has also begun selectively monetizing some of its bitcoin holdings under a new capital management program while pursuing its ‘Digital Credit’ business and maintaining a $1 billion share repurchase authorization.

BITCOIN | Leading Crypto VC Firm Urges a Digital Asset Treasury Portfolio Company to Liquidate its Bitcoin Holdings

“We’re not changing our long-term conviction in bitcoin,” the company said.
“The quarter’s reported loss primarily reflects the accounting impact of fair-value measurement rather than changes in the underlying economics of our strategy.”

BITCOIN | The World’s Largest Institutional Holder of Bitcoin Makes a Significant Shift in its Strategy

The results mark another volatile quarter for Strategy whose earnings have become increasingly tied to fluctuations in bitcoin prices since adopting fair-value accounting for its digital asset portfolio. While the accounting treatment creates large paper gains and losses from quarter to quarter, it does not necessarily reflect realized investment performance.
Shares of Strategy edged lower in after-hours trading following the results.


CASE STUDY | The Financing Model that Fueled Rapid Expansion of Bitcoin Treasury Companies is Showing Signs of Strain




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The 2026 FIFA World Cup generated more than $20 billion in prediction market trading volume and $24 million in digital collectible transactions, underscoring how major sporting events are increasingly driving on-chain activity beyond traditional cryptocurrency trading, according to a report by blockchain analytics firm, Chainalysis.
The report found that
over 400,000 unique wallets participated in blockchain prediction markets linked to the tournament.
Of the $20 billion in total trading volume recorded between January 2026 and the end of the World Cup in July 2026, approximately $5.7 billion was generated during the tournament’s five-week run accounting for
roughly 63% of all on-chain prediction market activity during that period.

INSTITUTIONAL | FIFA World Cup 2026 Selects ADI PredictStreet as its Preferred Prediction Markets Platform

Chainalysis said the World Cup became one of the largest sporting events ever for blockchain prediction markets, surpassing previous major sports tournaments in terms of participation and liquidity.

Daily trading activity accelerated rapidly as the tournament began, with prediction markets recording nearly $50 million in daily on-chain volume during the opening stages as users wagered on match winners, tournament outcomes and other event-related contracts.

MILESTONE | 2026 FIFA World Cup Sees ~$2 Billion in Prediction Markets Bets Before Kick Off

Beyond prediction markets, FIFA’s official FIFA Collect digital collectibles platform generated approximately $24 million in stablecoin-powered transaction volume. The marketplace allowed fans to purchase, trade, and redeem NFT-based collectibles with some digital assets providing access to exclusive experiences, merchandise, and World Cup-related rewards, illustrating how blockchain infrastructure was used for both speculation and fan engagement during the tournament.

NORTH AFRICA | Leading Egyptian Football Club, Al Ahly, Becomes the First African Club to Join the FIFA Collect NFT Marketplace

Despite concerns that prediction markets could facilitate illicit finance, Chainalysis said criminal activity represented only a small fraction of overall participation.
The firm identified approximately $5.4 million in transaction flows involving sanctioned entities, primarily linked to crypto exchange HTX (formerly Huobi). However, fewer than 1% of participating wallets showed any exposure to illicit activity suggesting the overwhelming majority of users were legitimate sports fans and traders.
The United States and China accounted for the largest share of transaction volume, followed by Canada, Thailand, and the United Kingdom, reflecting the global appeal of prediction markets during one of the world’s biggest sporting events.
Chainalysis said the World Cup demonstrated that large-scale global events can serve as catalysts for blockchain adoption beyond payments and crypto investing.
The firm noted that prediction markets and tokenized digital collectibles are emerging as mainstream consumer applications attracting hundreds of thousands of users who may have had little prior interaction with blockchain technology.


REPORT | Sports Becomes the Largest Event Category in Prediction Markets History in June 2026



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Institutional investors now account for nearly three-quarters of crypto trading volumes, underscoring how Wall Street’s growing presence is reshaping digital asset markets and dampening the extreme volatility that once defined the sector.
Institutional traders represented a record 72% of total crypto trading volume in the second quarter of 2026, up from 68% in the first quarter, according to a report by crypto market maker, Wintermute. The shift comes as hedge funds, asset managers, proprietary trading firms, and banks continue to expand their exposure to digital assets through regulated products and sophisticated trading infrastructure.

INSTITUTIONAL | The Industry Has Entered a New Phase of Mainstream Adoption, Say Crypto, Fintech Executives at Consensus Miami 2026

Wintermute said the increasing dominance of professional investors has fundamentally changed crypto market dynamics with bitcoin and ether experiencing smaller price swings despite continued macro-economic uncertainty and heightened geopolitical tensions (see image below).

“In contrast to retail, who are momentum- and sentiment-driven, institutional investors trade with risk limits and defined mandates,” said the report.


“Institutions are now the primary drivers of liquidity across digital asset markets,” Wintermute said in the report, adding that “their growing participation is creating deeper, more efficient markets while reducing the outsized volatility that historically characterized crypto trading.”

STATISTICS | ETFs Now Drive U.S. Bitcoin Trading More Than Spot Exchanges – Now Accounting for Over 50% Bitcoin Trading Volume

The report found that institutional capital has become increasingly selective favoring bitcoin, ether, stablecoins, and tokenized real-world assets over speculative altcoins. Rather than chasing momentum across the broader market, professional investors are concentrating on assets with
stronger liquidity,
regulatory clarity, and
institutional-grade infrastructure.

INSTITUTIONAL | AI Agents, Large Corporations to Drive Next Wave of Stablecoin Adoption, Say Executives at Consensus 2026

“Institutions keep a tight set of tokens while retail goes wider.” the report notes.
“Between H1 2024 and H1 2026, the number of unique tokens traded by institutional counterparties grew by just 24%, compared with 76% for retail.”

Wintermute said the trend reflects crypto’s transition from a retail-driven market to one increasingly influenced by traditional financial participants.


“The era of broad-based altcoin rallies driven by retail speculation is giving way to a more fundamentals-driven market,” the report said.
“Capital is becoming increasingly concentrated in assets that offer clear utility, liquidity, and institutional relevance.”

BITCOIN | America’s Largest Bank Says Bitcoin Dominance as Institutional Crypto Asset is Unlikey to Change

The growing institutional footprint has coincided with a surge in
tokenized assets,
stablecoin adoption, and
regulated investment vehicles
as Wall Street firms deepen their involvement in digital assets following the success of spot crypto exchange-traded funds and broader regulatory clarity in major markets.

STABLECOINS | Financial Institutions and Corporate Treasury Teams Driving Stablecoin Adoption in Europe

Wintermute also pointed to continued growth in tokenized real-world assets as another area attracting institutional capital with investors increasingly viewing blockchain infrastructure as a foundation for traditional financial products rather than solely speculative cryptocurrencies.

“In 2025, assets came on-chain. In 2026, they began to change hands,” notes the report.

Tokenized debt sits with institutions, equities with retail.
The report notes that the average AuM per address shows it is low for equities and commodities, and multiples higher for debt instruments with treasuries, private credit, and money-market products, in a few hands and in size.

Share of Tokenized AuM and Active Addresses, with Average AuM per Address, by Asset Class

The report thus concludes by saying:
“Retail is tokenizing the equities it already trades. Institutions are tokenizing what they hold on balance sheet.”

The findings reinforce a broader industry trend in which institutional participation is reshaping crypto market structure, reducing volatility while improving liquidity and price discovery even as retail activity remains subdued compared with previous bull market cycles.


MARKET ANALYSIS | ‘There is No Retail Interest in Crypto Right Now,’ Say Analysts



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South Korea has unveiled a draft law that would establish a comprehensive regulatory framework for digital assets, with stablecoins at the center of the proposed legislation as Seoul moves to formalize one of the world’s largest cryptocurrency markets.

The proposed Digital Asset Basic Act would introduce
licensing,
registration, and
reporting
requirements for cryptocurrency businesses, including exchanges, custodians, brokers and advisers, while creating a dedicated legal framework for issuing and supervising stablecoins.

STABLECOINS | South Korea’s Largest Bank Successfully Completes Local Stablecoin Pilot

Under the proposal, issuers of fiat- and asset-backed stablecoins would be required to
obtain regulatory approval,
maintain adequate capital,
hold reserve assets to guarantee redemptions and meet operational, and
governance standards.
The bill also outlines refund reserve and redemption obligations aimed at protecting users.
The legislation follows months of debate between the Bank of Korea and the Financial Services Commission (FSC) over who should be allowed to issue Won-backed stablecoins. The central bank has argued that issuance should be limited to licensed commercial banks to safeguard financial stability, while the FSC has pushed for broader participation by fintech and technology firms to encourage innovation.

STABLECOINS | South Korea Accelerating Efforts for Local Currency Alternatives to Counter Dollar-Pegged Stablecoin Dominance

The draft law also establishes a broader legal framework covering the issuance, trading, custody, and supervision of digital assets, marking South Korea’s latest effort to position itself as a regional digital finance hub while strengthening consumer protections following the 2022 collapse of the Terra ecosystem founded by South Korean entrepreneur, Do Kwon.
If enacted, the legislation would place South Korea alongside jurisdictions such as
the United States,
the European Union, and
Singapore
that have introduced dedicated stablecoin rules as governments race to regulate the fast-growing sector.


REGULATION | South Korea Draft Bill to Classify Stablecoins as Foreign Exchange Payment Instruments





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