The U.S. House Committee on Oversight and Government Reform has opened an investigation into Polymarket and Kalshi over concerns tied to insider trading and wagers allegedly linked to classified information.

According to a statement released by the committee, Chair James Comer sent formal letters to Polymarket CEO Shayne Coplan and Kalshi CEO Tarek Mansour requesting internal records and compliance details related to user activity on their platforms.

The committee said it wants to assess how the companies detect suspicious trading, verify customer identities, and enforce geographic restrictions designed to comply with U.S. regulations.

In the letters, Comer said prediction market operators hold the internal data needed to identify whether users are trading with access to non-public information. He also raised concerns that offshore platforms may be allowing users to bypass federal compliance rules.

Congressional scrutiny intensified after a New York Times investigation cited more than 80 Polymarket users who allegedly placed unusually timed bets ahead of undisclosed U.S. and Israeli military operations involving Iran. Committee documents said those trades have raised questions about whether safeguards on prediction market platforms are sufficient to stop insider activity.

Federal prosecutors have already filed charges in one case highlighted by lawmakers. According to the committee, U.S. Army Master Sergeant Gannon Ken Van Dyke allegedly used classified information tied to “Operation Absolute Resolve,” an operation connected to Venezuelan President Nicolás Maduro, to place prediction market wagers that generated more than $409,000 in profits.

Why are lawmakers focusing on prediction markets now?

The House investigation arrives as prediction markets face pressure from regulators in multiple countries. Earlier this year, Minnesota became the first U.S. state to ban prediction markets after lawmakers classified them as illegal gambling operations.

Outside the United States, authorities in South Korea have also examined Polymarket over concerns tied to gambling-related content.

In India, the Ministry of Electronics and Information Technology ordered internet providers to block access to Polymarket after categorizing prediction markets as prohibited online money gaming platforms under the country’s Promotion and Regulation of Online Gaming Act 2025.

Indian regulators have argued that platforms allowing users to speculate on uncertain outcomes with real money expose younger users to gambling-related risks. Government policy discussions have also linked crypto-based prediction markets to concerns over stablecoin flows and unmonitored capital movement outside the banking system.

At the same time, Argentina, Colombia, and Romania have all restricted access to Polymarket after local authorities concluded that the platform operated outside domestic gambling frameworks.

How does the latest probe add pressure on Polymarket?

The congressional investigation comes only days after on-chain analysts flagged a suspected exploit involving Polymarket’s UMA CTF Adapter contract on Polygon. Blockchain investigator ZachXBT warned users after suspicious activity drained more than $520,000 from addresses tied to the contract.

Security firm PeckShield later said part of the stolen funds had already been moved through ChangeNOW. Blockchain analytics platform Bubblemaps separately reported that attackers were removing 5,000 POL tokens roughly every 30 seconds during the incident.

Polymarket contributor Shantikiran Chanal said the incident appeared linked to a compromised private key used for internal operations rather than a failure in the platform’s core contracts or market resolution systems. Chanal added that user funds and active markets remained safe during the incident.

The latest events have added technical security concerns to ongoing debates surrounding market integrity, oracle voting power, and the legal status of crypto-based prediction platforms.

Elon Musk’s rocket and satellite company SpaceX is planning a $75 billion IPO in June, which could make it the largest near-term public listing with a major Bitcoin treasury.

Key takeaways:

• A Nasdaq 100 fast entry could expand Bitcoin exposure among the top mega-cap stocks, including Tesla.
• The IPO may pressure tech stocks as passive funds sell existing Nasdaq names to buy SpaceX, which may prove bearish for Bitcoin.

SpaceX IPO set to increase Nasdaq’s exposure to Bitcoin

SpaceX disclosed 18,712 BTC in its recent S-1 filing, worth roughly $1.45 billion, making it the largest known Bitcoin holder among companies preparing for, or recently filing for, a public listing.

Source: SpaceX’s S1 Filing

Under Nasdaq’s newer “fast entry” rules, mega-cap IPOs can enter the Nasdaq 100 within 15 trading days, meaning SpaceX could quickly become one of the index’s largest constituents if its valuation lands near the $1.75 trillion–$2 trillion range after the $75 billion IPO.

As a result, Bitcoin exposure inside the Nasdaq 100 may expand beyond Tesla.

The electric carmaker already holds 11,509 BTC on its balance sheet. SpaceX, with 18,712 BTC, would give the Nasdaq 100 a second Elon Musk-linked mega-cap company with direct Bitcoin exposure.

“With the SpaceX IPO, the Mag 7 will become the Mag 8,” said Phong Le, CEO of Strategy, while referring to the elite group of mega-cap tech stocks, namely Apple, Microsoft, Nvidia, Amazon, Alphabet, Meta and Tesla.

He added:

“25% of the Mag 8 will have Bitcoin on their balance sheet.”

Bitcoin still faces downside risks

SpaceX IPO may be “bad news for tech stocks,” according to analyst Nic Puckrin.

“If it’s added to the Nasdaq 100 in a ‘fast entry’, passive funds have to buy it & sell other stock,” Puckrin said in a Friday post, adding:

“The higher SpaceX goes, the more they buy of it and sell of others. It’s going to act like a massive capital vacuum.”

Puckrin based his outlook on JPMorgan estimates showing that Nvidia could face more than $20 billion in passive outflows if SpaceX enters the Nasdaq 100.

JPMorgan projections for rebalancing outflows from passive investors. Source: Financial Times/Nic Puckrin

Apple could face roughly $16 billion in estimated passive outflows, with Microsoft, Amazon, Alphabet, Broadcom, Meta and Tesla also likely to serve as funding sources for the SpaceX rebalance.

Bitcoin has traded closely with mega-cap tech for most of 2026.

As of Friday, BTC’s 30-day rolling correlation with the Roundhill Magnificent Seven ETF (MAGS), which tracks the Mag 7 stocks, stood near +0.81.

BTC/USD vs. MAGS correlation coefficient. Source: TradingView

For traders, that means BTC has recently moved in the same direction as major tech stocks more often than not.

So, if the SpaceX rebalance pressures Nvidia, Apple, Tesla and other large tech names, Bitcoin may also face short-term downside risk as investors reduce exposure to the broader risk-on trade.

How low can BTC price go?

On-chain metrics show Bitcoin’s apparent demand has dropped to its lowest in four months, which may lead to months of consolidation.

That weak demand backdrop also lines up with BTC’s current technical structure. Since February, Bitcoin has been moving inside an upward-sloping bear flag, a pattern that often forms during a pause in a broader downtrend.

For now, BTC’s immediate downside target sits around the $73,000–$74,000 range, near the flag’s lower trendline. A rebound from that area could send the price back toward the flag’s upper boundary near $85,000.

BTC/USD daily chart. Source: TradingView

Related: Bitcoin liquidity balance hints at developing rally toward $80K

The flag setup could open the door to a deeper decline toward $56,000, based on the pattern’s measured move, if BTC closes decisively under the lower trend line.

As has been the case all week, bitcoin (BTC) is trading in a tight range around the $77,000 level in U.S. morning action.

There was some economic news on Friday morning, and it wasn’t pretty. The University of Michigan Consumer Sentiment Index for May fell to a record low 44.8 from 48.2 previously and versus economist forecasts for 48.2. The Expectations Index also fell to a record low of 44.1.

The UMich 1-year Consumer Inflation Expectations Index rose to 4.8% from 4.5% previously. The 5-year Inflation Index rose to 3.9% from 3.4%.

It’s yet another disturbing stagflationary data point confronting Kevin Warsh as he’s set to take over as chairman of the Federal Reserve. President Trump appointed Warsh in the hope that he would lead the central bank to cut interest rates, but the Iran war has sent oil prices soaring and re-ignited what had been cooling inflation.

Rate traders are now pricing in more than a 70% chance of one or more rate hikes by the end of 2026.

Warsh’s official swearing-in is set for 11 am ET.

U.S. stocks, meanwhile, are posting modest gains ahead of the three-day weekend. The Nasdaq is higher by 0.3% and the S&P 500 by 0.4%.

XRP Ledger has recorded a notable spike in new addresses over the past 24 hours, suggesting renewed on-chain activity even as XRP’s price remains constrained by overhead resistance around the $1.40 region.

Santiment highlighted the latest burst in network growth, noting 4,300 wallets were created in a 24-hour window—the year’s fourth-largest spike so far in 2026. Daily active addresses also climbed to 43,520 from roughly 32,000 in the same period. The analytics firm underscored that “network growth is among the top leading signals to identify reversals.”

Key takeaways

• XRP Ledger added 4,300 new wallets in 24 hours, marking a substantial growth spike in 2026.
• On-chain activity accompanied a rise in daily active addresses, signaling renewed participation on the Ripple-backed network.
• US spot XRP ETFs continue to attract inflows, with May flows supporting liquidity and demand through institutional channels.
• Investor cost basis around $1.37–$1.45 may create a nearby resistance band for XRP as short-term buyers confront profit-taking risk.
• A potential breakout remains contingent on clearing a resistance zone around $1.40–$1.55 and navigating higher-timeframe chart patterns, including a falling wedge that analysts see as a setup for possible upside.

Surge in XRP Ledger activity signals growing participation

The latest data from Santiment indicates the XRP Ledger’s wallet activity is experiencing a meaningful uptick. The firm reported 4,300 newly created wallets on May 20, lifting the daily wallet increase to one of the year’s strongest spikes. Alongside the wallet growth, daily active addresses rose to about 43,520—an uptick that traders watch as a potential precursor to price moves.

Santiment summarized the dynamic by stressing that “network growth is among the top leading signals to identify reversals.” In other words, a surge in fresh participation can precede a shift in sentiment and buying pressure, even when price action is temporarily stalled.

Analysts have noted that rising wallet creation often foreshadows a broader move as new participants enter the ecosystem. Amonyx, an independent observer, commented that the observed wallet growth could attract attention from “smart money,” potentially signaling fresh participation in XRP markets. Niroshan682 added that new wallet creation is frequently an early signal of renewed network activity, particularly when paired with signs of growing institutional adoption.

ETF flows lend support to XRP’s institutional backdrop

Despite the on-chain growth signals, XRP’s price action has been modest, with the pair sliding about 1.5% over the last 24 hours and sitting roughly 62% below the July 2025 high of $3.66. The liquidity backdrop, however, is being bolstered by exchange-traded product inflows. In May, XRP spot ETFs have continued to accumulate, with inflows totaling around $107.3 million so far this month and marking the 12th straight day of positive flow. Measured across the month, total inflows push the year-to-date figure toward the $1.4 billion mark, while assets under management sit near $1.15 billion.

Spot XRP ETF activity provides a useful counterweight to price volatility, giving market participants a liquid channel for exposure and a signal of sustained demand from institutional-grade investors. SoSoValue’s data visualization of ETF flows has become a reference point for watching how official investment vehicles are shaping XRP’s utility and accessibility.

Price action in context: resistance zones and potential breakouts

From a technical perspective, XRP staged a 21% rebound off a local low around $1.27 on April 5, advancing to roughly $1.55 before encountering resistance. The current price action has stalled within a broader range, with $1.40 to $1.55 forming a notable consolidation ceiling. This zone aligns with several moving averages—the 50-day simple moving average (SMA), the 100-day SMA, and the 100-day exponential moving average—creating a confluence of resistance that buyers must overcome to sustain a rally.

Cost-basis data from Glassnode provides another lens on potential price pressure. About 3.75 billion XRP are held at an average cost of roughly $1.37–$1.45, creating a concentration of cost-basis that could act as a liquidity anchor—meaning a sizable portion of holders may be inclined to sell if the price tests break-even zones, potentially stalling upside momentum.

Higher up, there’s a supply concentration around $1.68–$1.70, where an estimated 3.8 billion XRP sits in hands. This zone coincides with the upper boundary of a forming falling wedge pattern, a setup some analysts view as a precursor to a breakout. If XRP can clear the wedge’s upper trend line, a measured target around $3.52—roughly 50% above the current level—appears plausible, contingent on sustained buying interest.

Analysts have flagged that a decisive push above the $1.40 barrier is a prerequisite for any meaningful reversal. In prior coverage, Cointelegraph noted that a close above $1.61 could confirm a trend change, underscoring that the path to a longer-term advance depends on breaking through this consolidation zone.

In sum, XRP’s near-term trajectory hinges on a blend of on-chain activity, ETF-driven liquidity, and the ability to pierce the current resistance cluster. While wallet growth signals a renewed interest in the network, price players are awaiting a clear breakout signal that could unlock a more confident move toward the higher targets indicated by chart patterns and supply analytics.

What to watch next: traders and investors should keep an eye on whether XRP can sustain the recent wallet growth alongside continued ETF inflows, and whether it can push decisively through the $1.40–$1.55 zone to validate a potential breakout. Ongoing on-chain metrics and the evolving ETF landscape will shape whether the current consolidation gives way to a new leg higher or a renewed phase of range-bound activity.

If Bitcoin drops below $73,786, more than $1.29 billion in leveraged long positions could be liquidated across major centralized exchanges, according to derivatives analytics platform Coinglass.

Fresh data from Coinglass show that if Bitcoin (BTC) falls under $73,786, cumulative long liquidation intensity on mainstream centralized exchanges reaches roughly $1.291 billion, highlighting just how crowded leveraged bullish bets have become near all time highs.

How exposed are Bitcoin longs and shorts at current levels

On the flip side, the same liquidation heat map indicates that if Bitcoin breaks above $80,995, cumulative short liquidation intensity would climb to about $1.223 billion, setting up the conditions for an aggressive squeeze if price decisively clears resistance.

🚨 BREAKING:

HERE’S WHY BITCOIN IS DUMPING RIGHT NOW:

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BYBIT DUMPING MILLIONS IN BTC
WHALES DUMPING MILLIONS IN BTC
COINBASE DUMPING MILLIONS IN BTC
BINANCE DUMPING MILLIONS IN BTC
WINTERMUTE DUMPING MILLIONS IN BTC

THEY SOLD OVER $2B OF $BTC

RIGHT AFTER THE U.S MARKET OPEN… pic.twitter.com/yCYFM4ZoFk

— ardizor 🧙‍♂️ (@ardizor) May 22, 2026

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These levels sit inside a broader trapdoor and squeeze zone Coinglass mapped out in April, when the platform warned that a break below $73,610 could trigger around $2.221 billion in BTC long liquidations, while a move above $81,264 would expose roughly $913 million in shorts to forced buybacks.

At the time, Coinglass described the band between those thresholds as a “$3.1 billion liquidation minefield” for traders trying to play Bitcoin’s breakout, underscoring how derivatives positioning now drives violent intraday swings.

A separate snapshot in March, cited by a previous crypto.news liquidation report, showed about $2.056 billion in BTC longs at risk if the price slipped below roughly $70,346, versus $1.514 billion in shorts facing liquidation above $77,312, turning even a narrow range into a multi billion dollar forced flow corridor.

In another Coinglass based analysis, a drop below $66,724 was estimated to put around $1.304 billion in BTC longs in the firing line, while a breakout above $73,613 threatened about $1.296 billion in shorts, again emphasizing the balance of pain on both sides of the order book.

Why these BTC liquidation bands matter for traders

Coinglass explains that its liquidation heat map aggregates leveraged positions across major venues into price bands, allowing traders to see where long and short positions would be forced to close if spot price moves against them.

“When you see billions of dollars in liquidations stacked within a few percent of price, it means any clean break can accelerate into a cascade as exchanges buy or sell to close positions,” the analytics team notes in its liquidation map documentation.

That dynamic has already surfaced multiple times in 2026, with Coinglass reporting days when network wide crypto liquidations topped $2.5 billion as Bitcoin and other majors whipsawed around key levels.

As a recent crypto.news deep dive on Bitcoin liquidation bands noted, these clusters often sit just above and below round number resistance, which can turn a modest breakout or breakdown into a disorderly short squeeze or long flush.

For traders tracking the latest readings, Coinglass currently highlights that a fall below $73,786 concentrates roughly $1.291 billion in long liquidations, while a push above $80,995 aligns around $1.223 billion in short liquidations on major centralized exchanges.

That means Bitcoin’s next clean move of less than $10,000 either way from this band could again unlock more than $2.5 billion in forced flows, echoing the risk corridors seen in March and April and leaving overleveraged positions dangerously exposed.

The attacker behind the Verus bridge exploit has returned 4,052 Ether, worth about $8.5 million, to the project’s team wallet after Verus offered a 1,350 ETH bounty for the recovery of most of the stolen funds.

The return represents about 75% of the stolen funds, with the exploiter retaining 1,350 Ether (ETH), worth about $2.8 million as a bounty, according to blockchain security firm PeckShield on Friday.

Verus had offered the bounty a day earlier, saying it would treat the retained ETH as a reward if the exploiter returned 4,052.4 ETH to the team address within 24 hours.

The recovery shows how some crypto projects try to negotiate directly with exploiters to recover stolen funds, though such deals do not necessarily prevent law enforcement or third parties from taking action.

The recovery comes days after the Verus-Ethereum bridge was drained in a forged cross-chain transfer exploit, adding to a string of bridge and decentralized finance (DeFi) attacks that have kept crypto security concerns high in 2026.

Source: PeckShield

DeFi hacks topped $600 million in April

DeFi hacks surged to a cumulative $634 million worth of value stolen in April, data aggregator DefiLlama shows. The $280 million Drift Protocol exploit and the $293 million Kelp exploit represented the largest incidents of the month. 

Total hacked by monthly sum, all-time chart. Source: DefiLlama

Losses have fallen sharply in May, with DefiLlama data showing roughly $38 million stolen so far this month.

Related: Crypto VC funding plunges to $659M in April, hits near two-year low

Still, cryptocurrency hacks remain one of the biggest hurdles halting mainstream blockchain adoption.

During the past decade, crypto hackers stole over $17 billion across 518 recorded incidents, with the majority stemming from compromised private keys, alongside phishing and other credential-based attacks, Cointelegraph reported on April 21. 

Magazine: The legal battle over who can claim DeFi’s stolen millions

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