Cryptocurrency markets remained on the back foot Friday as macroeconomic signals from Japan, one of the world’s largest economies, compounded uncertainty driven by the Iran war.

Bitcoin BTC$77,728.01 hovered near $77,800, having struggled to break above the Thursday high of $78,700 during the early Asian trading hours, according to CoinDesk data. The broader uptrend, which began in late March near the $65,000 mark, appears to have stalled since Wednesday.

Ether (ETH), the second-largest cryptocurrency by market capitalization, traded around $2,300, slipping 0.8% since midnight UTC and underperforming bitcoin’s relatively modest 0.6% decline.

The cautious tone in crypto markets coincided with fresh inflation data out of Japan. The country’s Corporate Service Price Index (CSPI) rose 3.1% year-on-year in March, exceeding forecasts of 3.0% and underscoring persistent price pressures in the services sector.

Additional government data showed core inflation rising to 1.8% in March from 1.6% in February, marking the first acceleration in five months. Headline inflation edged up to 1.5% from 1.3%, though it remained below the Bank of Japan’s 2% target for a second consecutive month. Meanwhile, core-core inflation, which excludes both fresh food and energy, eased to 2.4%, its lowest level since October 2024.

The uptick in headline inflation aligns with rising energy costs linked to geopolitical tensions, particularly disruptions to oil shipments through the Strait of Hormuz amid the ongoing Iran conflict.

apan, a major crude importer, remains especially vulnerable to such price shocks. WTI crude futures have risen over 40% to $96 since the onset of the Iran war in late February.

Market participants are now turning their attention to the Bank of Japan’s upcoming policy meeting. Analysts at InvestingLive suggest a shift in tone may be imminent.
“The Bank of Japan looks set to hold fire next week but deliver a pointed warning that rates are heading higher, with June firmly in play as war-driven inflation risks build,” analysts said.

Hints of tighter monetary policy and potential rate hikes could lift the Japanese yen (JPY) and influence global market sentiment. It’s especially plausible now, given that speculative positioning in the yen is currently bearish, according to the latest CFTC data. As a result, there is room for a sharp bullish reaction in the yen if the Bank of Japan turns hawkish.

As for the broader market impact, a stronger yen may not be favorable. Historically, the yen has been used to fund purchases of risk assets worldwide. A sudden appreciation in the currency could therefore trigger an unwinding of those trades, leading to increased risk aversion.

Speaking of the Iran war, Iran has deployed additional naval mines in the Strait of Hormuz this week, according to Axios. Shipping traffic through the Hormuz, which
accounts for 20% of the world’s seaborne oil, fallen sharply since the conflict intensified.

The Pentagon warned lawmakers that it would take at least six months to clear mines in the Strait, with the process only beginning after the war ends. It also cautioned that inflation in the U.S. could remain elevated this year, potentially making it harder for the Fed to cut rates.

The FTX bankruptcy estate sold a 5% stake in Cursor for $200,000 in April 2023. 

The sale matched the original amount Alameda Research invested in Anysphere, the company behind Cursor, in April 2022.

The stake has drawn fresh attention after Cursor’s reported valuation rose sharply. SpaceX said it secured the right to acquire Cursor later this year at a $60 billion valuation.

At a $60 billion valuation, the former FTX-linked stake would be worth about $3 billion. That marks a large difference from the $200,000 sale price recorded during bankruptcy asset liquidation.

The new valuation came after SpaceX secured acquisition rights tied to Cursor. SpaceX could also pay a $10 billion breakup fee if the transaction does not move forward.

Bankruptcy sales face renewed review

The Cursor sale has added to questions over how the FTX estate handled early asset sales. The estate moved to liquidate assets after FTX collapsed and Alameda entered bankruptcy.

Sam Bankman-Fried has criticized the bankruptcy process from prison. Earlier this year, he wrote, “FTX was never bankrupt. I never filed for it.” He also claimed, “The lawyers took over the company and 4 hours later, they filed a bogus bankruptcy so they could pilfer it for money.”

FTX creditors have since received repayments in dollar terms under the restructuring plan. The repayments included claim values plus interest, though some former users have argued they missed gains from crypto and venture assets.

Bull Theory estimates wider missed value

Financial research platform Bull Theory estimated that assets sold early by the FTX estate could now be worth about $114 billion if held through recent market cycles. The analysis listed Anthropic, SpaceX, Solana, Robinhood, Genesis Digital, and Cursor among the missed gains.

Bull Theory wrote, “SBF was a genius at picking generational winners and a criminal at managing their money.” The platform also noted that the estate recovered about $18 billion for users.

Bankman-Fried is serving a 25-year federal sentence after his conviction on fraud and conspiracy charges. Prosecutors said he misused billions of dollars in customer funds from FTX through Alameda Research, investments, political donations, and personal spending.

OKX has added BitGo’s Off-Exchange Settlement platform for institutional clients in the United States. The integration allows firms to trade on OKX while holding their assets in BitGo’s cold custody.

The move is designed to reduce the need for clients to pre-fund exchange accounts before trading. It also gives institutions a way to keep assets with a third-party custodian while accessing liquidity on OKX.

OKX said the setup supports capital efficiency for professional traders and firms. Under the arrangement, BitGo serves as the custodian and settlement provider for trades executed on the exchange.

Exchange targets institutional growth in the US

The BitGo integration comes as OKX continues to build its US business. The exchange reentered the US market in April 2025 and appointed former Barclays director Roshan Robert as its US CEO. Robert said institutional investors need both asset protection and trading access. 

“Institutional capital entering crypto requires capital to be protected and to be put to work,” he stated. “Our proprietary custody infrastructure has been proven at scale, and our partnership with BitGo gives clients flexibility in how they protect assets while freeing capital to work harder.” 

The comments point to OKX’s effort to serve firms that want custody options outside the exchange.

ICE investment shapes OKX’s US plan

OKX’s latest step follows an investment by Intercontinental Exchange in early March. The investment valued OKX at $25 billion and gave ICE executives a board seat at the crypto exchange.

OKX Global CEO Star Xu said at the time that the partnership would help shape the company’s US strategy. He also described the exchange’s local presence as a “blank sheet of paper.” Xu said custody remains a core part of OKX’s business. 

“At the same time, we’ve expanded our custody partnerships with trusted leaders like BitGo to give clients greater flexibility and choice in how they secure their assets,” he stated.

Moreover, BitGo has offered off-exchange settlement services for several years. The platform supports settlement for digital asset trades made on third-party exchanges while assets remain under BitGo custody.

However, BitGo has also disclosed risks tied to the service. In its January IPO filing, the company cited operational, regulatory, and counterparty risks.

“Operational risks associated with our OES services include potential errors in processing trade data, delays or failures in asset transfers, employee or insider misconduct, cybersecurity incidents, technological disruptions and reconciliation errors,” BitGo said.

Prediction markets have a consistent line: their products are financial instruments, not bets. Wisconsin isn’t buying it, and in a new complaint targeting Kalshi, Coinbase, Polymarket, Robinhood and Crypto.com, the state is citing the companies’ own marketing to call them unlicensed gambling venues.

“Thinly disguising unlawful conduct doesn’t make it lawful,” Attorney General Josh Kaul said in a press release announcing the complaints on Thursday.

The question underneath the lawsuits is straightforward: are these contracts financial instruments under the Commodity Futures Trading Commission (CFTC), or bets under state gambling law? The answer determines whether a fast-growing market operates under a single federal rulebook or is carved up across 50 states under the jurisdiction of local gaming regulators. And it’s almost certainly headed to the Supreme Court.

Wisconsin’s complaints, filed in Dane County, target three parallel ecosystems.

One names Crypto.com and its derivatives arm. Another goes after Polymarket and affiliated entities. A third pulls in Kalshi alongside distribution partners Robinhood and Coinbase (both Robinhood and Coinbase route prediction market orders to Kalshi), arguing the platforms together facilitate sports betting for state residents.

Across all three, the legal theory is that so-called “event contracts” are wagers: users pay money to take a position on a real-world outcome and receive a fixed payout if they are correct.

In one example cited in the filings, traders could buy contracts tied to NCAA tournament games at prices that reflect implied probabilities, with winning positions paying out $1 and losing ones returning nothing.

State prosecutors also cite Kalshi’s own Instagram ads, which claim the platform is “The First Nationwide Legal Sports Betting Platform,” and Polymarket’s, which calls itself “a platform where people can bet on the outcome of future events.”

The state argued that the structure of prediction markets falls squarely within its statutory definition of a bet, regardless of how the products are labeled or who takes the other side of the trade.

The complaints also emphasize that platforms generate revenue by charging transaction fees on each contract, likening the model to a casino taking a cut of wagers placed on its floor.

Setting up a federalism fight

The industry’s defense rests on federal preemption. Kalshi, in particular, has argued that its contracts are swaps listed on a regulated exchange and therefore fall under the CFTC’s exclusive jurisdiction.

That position received a boost earlier this month when the Third Circuit sided with the company, treating the regulator’s decision not to block the contracts as effectively settling the jurisdictional question.

Across the U.S., state courts are consistent in taking a different position.

Nevada called the contracts “indistinguishable” from gambling. New York AG Letitia James said “each contract is a bet.”.

For now, Wisconsin’s suits add to a growing list of state challenges, each building a record that could ultimately force the Supreme Court of the United States to decide whether calling something a financial contract is enough to keep it from being treated as a bet.

Lido says only about 9% of EarnETH’s TVL is tied to hacked rsETH, roughly $70M has been recovered, and a $3M DAO first‑loss buffer stands between users and any final hit.

Lido has outlined the fallout from the KelpDAO rsETH exploit, stressing that the incident is contained to its leveraged Earn vaults and that its flagship staking products stETH and wstETH “remain unaffected” and “safe and stable.” The Kelp cross‑chain bridge hack on April 18 drained about 116,500 rsETH — roughly $292 million — and forced multiple DeFi protocols to freeze rsETH markets, including Lido’s EarnETH product.

According to Lido, only the EarnETH vault has direct rsETH exposure, representing around 9% of its total value locked — approximately $21.6 million via a leveraged rsETH/ETH position on Aave. Deposits and withdrawals for EarnETH have been paused by the vault’s managers while they work with Kelp, LayerZero, and lending protocols to determine how any losses or bad debt will be allocated.

9% rsETH hit, $70M recovered, first-loss buffer

The team said that about $70 million worth of ETH linked to the broader exploit has already been recovered, with additional asset recovery and loss-distribution talks still in progress. In parallel, EarnETH managers have “reduced leverage and optimized the position structure,” significantly cutting the vault’s wETH debt exposure to ease liquidity pressure in stressed lending markets.

If there is a residual loss once recovery efforts are complete, EarnETH can tap a $3 million “first-loss protection mechanism” funded by the Lido DAO treasury. That buffer, part of a $5 million DAO allocation approved in March, is designed so that DAO-owned vault shares absorb losses before they hit other depositors, effectively putting LDO governance capital in front of users in a downside scenario.

Other vaults steady, GGV under pressure

Lido added that its DVV and EarnUSD vaults are not exposed to rsETH and continue to operate normally. A GGV sub‑vault, however, is currently showing negative returns because it combined circular staking strategies with rising on‑chain lending rates, a mix that has become more expensive and less sustainable in the current environment.

Managers say they are actively rebalancing GGV’s positions and adjusting strategy parameters, while withdrawal requests across the Earn suite will be processed using valuations from before the Kelp incident to keep treatment consistent during the review period. Lido reiterated that the rsETH issue “does not involve the Lido staking protocol itself,” underscoring the separation between its experimental Earn products and the core liquid staking infrastructure that underpins stETH and wstETH across DeFi.

TLDR

• Coinbase, Ripple, Kraken, and more than 100 crypto firms urged the Senate to advance the markup of the CLARITY Act.
• The industry groups warned that continued delays could push digital asset investment and jobs overseas.
• The Crypto Council for Innovation and the Blockchain Association led the joint letter to lawmakers.
• Lawmakers postponed the January markup after disputes over stablecoin reward provisions.
• The CLARITY Act passed the House in July 2025 with a 294-134 vote.

Coinbase, Ripple, Kraken, and over 100 crypto firms asked the Senate Banking Committee to move forward with the CLARITY Act markup. The companies sent a joint letter urging lawmakers to establish a federal market structure framework. They warned that delays could push investment, jobs, and innovation outside the United States.

Industry coalition calls for progress on Clarity Act

The Crypto Council for Innovation and the Blockchain Association led the letter to Senate leaders. The groups stated that Congress must create a comprehensive federal framework for digital assets. They wrote that regulators alone cannot provide durable legal clarity.

The letter stressed that lawmakers should act without further delay. It argued that a predictable baseline would preserve US leadership in digital asset innovation. The signatories included Coinbase, Ripple, Kraken, and more than 100 industry organizations.

The coalition urged the Senate Banking Committee to schedule a markup soon. They pointed to months of stalled negotiations on the legislation. They said, “Congress must move quickly to establish a predictable federal baseline.”

The industry groups also outlined core priorities in the bill. They called for keeping activity-based consumer rewards tied to payment stablecoins. They also sought clear disclosure rules and token certification standards.

They emphasized a clear division of authority between the SEC and the CFTC. They also requested protections for developers and service providers working on decentralized technologies. The letter addressed concerns about illicit finance safeguards.

Senate negotiations stall as stablecoin debate continues

Senate Banking Republicans released fact sheets on the CLARITY Act in January. They described the bill as a framework clarifying oversight between the SEC and the CFTC. The committee expected to hold a markup soon after that release.

However, Coinbase CEO Brian Armstrong publicly opposed parts of the draft. He argued that some provisions would weaken the CFTC’s role. He also said the draft would “effectively kill stablecoin rewards.”

Lawmakers and industry participants disagreed over stablecoin reward provisions. Those disputes forced the committee to postpone its planned January debate. The legislation then remained under negotiation through March.

The bill passed the House in July 2025 by a 294-134 vote. Galaxy reported that the Senate has held intensive negotiations since January. The firm said lawmakers had expected a markup in late April.

That timetable began slipping after Senator Thom Tillis suggested waiting until May. As a result, the Senate Banking Committee did not confirm a markup date. The industry letter now urges the committee to move forward without further postponement.