Crypto-backed political groups supported several winning candidates in Texas primary runoffs Tuesday, highlighting the digital asset industry’s growing role in US elections as Congress debates new rules for crypto markets.

Attorney General Ken Paxton won the Republican US Senate runoff against four-term Senator John Cornyn by a wide margin, according to Texas primary runoff results, and will face Democratic state Representative James Talarico in November.

In Houston’s 18th Congressional District, Democrat Christian Menefee unseated fellow Democrat representative Al Green in a decisive win after Republican-led redistricting forced the two incumbents into the same district, ousting one of the state’s most senior House members.

Democrats and Republicans Alex Mealer and Jon Bonck also secured their party’s nominations in competitive Houston-area House races.

The contests drew heavy spending from crypto-aligned political action committees (PACs) focused on a small number of high-stakes races, and come as Congress debates new rules for digital asset markets, including legislation to define crypto market structure and establish a framework for dollar‑pegged stablecoins.

Stand With Crypto assigned Al Green an “F” rating. Source: Stand With Crypto

Victories by candidates backed by crypto-focused PACs in a politically influential state could give the industry additional allies as those measures advance.

Crypto money reshapes key Texas races

Two races in particular show how that money is being deployed. Protect Progress, an affiliate of the Fairshake super PAC backed by firms including Ripple and Coinbase, reported spending about $5 million to support Menefee and a further $2.8 million on advertising opposing Green in the Houston race.

Another crypto-focused group, Fellowship PAC, funded in part by financial firm Cantor Fitzgerald and crypto custodian Anchorage Digital, reported roughly $500,000 in spending to boost Paxton over Cornyn in the Senate runoff.

Fairshake’s Republican affiliate, Defend American Jobs, also backed four winning Republican candidates, Jon Bonck, Tom Sell, Carlos De La Cruz and Alex Mealer.

Related: Texas Lt. Gov. calls for study of crypto, prediction markets 

Texas runoffs test crypto’s political power

Bitcoin-focused policy advocate Dennis Porter commented on Menefee’s victory, saying, “A pro crypto Democrat just ousted a 20-year incumbent Democrat who was anti crypto. Nature is healing,” a nod to what many in the industry saw as years of Democratic-led “Operation Choke Point 2.0,” campaigns, in which bank regulators and enforcement agencies have been accused of squeezing crypto firms out of the financial system.

While much of crypto PACs’ recent spending in the state has gone to Republican candidates, Menefee’s win gives the groups a high-profile Democratic ally in Texas.

The crypto advocacy group, Stand With Crypto, assigned Green an F grade for his strong opposition to industry-backed legislation, while Menefee is rated as supportive of digital asset innovation.

Prediction markets had strongly favored the crypto-aligned challengers heading into election day. Contracts on regulated and crypto-native platforms implied odds of over 90% that both Paxton and Menefee would prevail, with nearly $15 million reportedly traded on markets tied specifically to the Paxton vs Cornyn runoff.

Magazine: Guide to the top and emerging global crypto hubs — Mid-2026

China’s Supreme People’s Court (SPC) said it will study new adjudication rules for virtual currency and cross-border finance cases as part of a broader push to clarify how courts handle digital economy disputes.

“We will conduct in-depth research on the adjudication rules for new cases such as virtual currencies and cross-border finance, formulate judicial interpretations on civil compensation involving insider trading and market manipulation as soon as possible,” said Liu Guixiang, Judicial Committee member of the SPC, during a press conference, reported Chinese news outlet Yicai on Wednesday.

The court also plans to study judicial protection rules for artificial intelligence cases and data property rights, including disputes involving data ownership, data transactions and AI-generated content.

The development aims to draft clearer internal judicial standards on how courts should decide disputes and liability in crypto and AI intellectual property rights-related lawsuits. The promised guidelines may improve the court’s consistency in the growing number of crypto and AI-linked cases in the country.

The comments come months after a high-profile lawsuit involving Chen Zhi, the Chinese-born founder and chairman of Cambodia’s Prince Group, who was arrested in Cambodia on Jan. 6, 2026, and extradited to China shortly after, where he faces charges related to operating pig butchering scam compounds. 
In October 2025, the US Department of Justice seized about $15 billion worth of Bitcoin (BTC) from Zhi’s suspected operations.

US authorities charge Chen Zhi and seize $15 billion in Bitcoin. Source: Justice.gov

China’s ban on all crypto transactions remains in place

Mainland China has had a rocky relationship with the cryptocurrency industry.

In December 2013, the People’s Bank of China (PBOC) banned financial institutions from offering Bitcoin-related services and stated that Bitcoin was not recognized as a currency, in its first major prohibitive step against the crypto industry.

Related: South Korean funeral company records $33M unrealized loss on leveraged ETH ETFs

In September 2021, ten Chinese agencies, including the central bank and securities regulators, issued a blanket ban on all crypto transactions, Bitcoin mining and activities tied to initial coin offerings (ICOs) in the country. 

In February, the PBOC banned the issuance of unauthorized offshore Chinese yuan-pegged stablecoins and the unapproved issuance of tokenized real-world assets (RWAs).

The structure of the digital yuan, China’s CBDC. Sources: Cointelegraph

The latest ban came shortly after the Chinese government approved commercial banks to share interest with clients holding the country’s digital yuan, a central bank digital currency (CBDC) managed by state authorities. 

The development signal that the PBOC is doubling down on its efforts to launch its own yuan-backed CBDC as a new form of digital fiat money, instead of stablecoins.

Magazine: 50K investors fight Korean crypto tax, Singapore cancels Bsquared: Asia Express

South Korean prosecutors have charged a group linked to the Solana-based memecoin CATFI, also known as Catpie, in what local outlets described as the country’s first prosecution tied to a rug pull on a decentralized exchange. The Seoul Southern District Prosecutors’ Office, through its Virtual Asset Crime Joint Investigation Division, arrested the core suspects. The lead figure, identified by the surname Park, allegedly posed online as “Eth Father” and promoted CATFI as an independent third-party project before the scheme unfolded, according to Digital Asset Works.

Investigators say the defendants used social media to hype CATFI, driving the token’s price up more than 1,000-fold within about 26 hours. They then sold their holdings for roughly 400 million won in illicit profits, while the rug pull inflicted about 900 million won ($599,000) in losses on at least 256 investors. The case represents a rare legal action in South Korea against memecoin price manipulation under the Virtual Asset User Protection Act.

Prosecutors noted that rug pulls are deceptive exit scams in which project creators cultivate investor interest, only to abandon the project and siphon away funds. Cointelegraph reached out to the Supreme Prosecutors’ Office for comment but had not received a response by publication as the investigation unfolds.

The case adds to the ongoing scrutiny of domestic crypto markets and comes as South Korea’s crypto trading activity has cooled. Digital Asset Works highlighted a broader market backdrop in which won-based exchanges have seen trading volumes shrink relative to the KOSPI stock market, underscoring heightened regulatory attention to market manipulation and investor protection.

Key takeaways

.li>First confirmed arrest in a memecoin rug pull under South Korea’s Virtual Asset User Protection Act, tied to the CATFI/Catpie case.
• CATFI surged over 1,000 times in price within 26 hours before promoters sold approximately 400 million won in illegal profits; roughly 900 million won in losses reported across at least 256 investors.
• The token’s market profile collapsed from an all-time peak to a dramatic 99% decline, with on-chain data showing 1,512 holders remaining as of now and the largest holder controlling about 18% of supply.
• Domestic market context features a notable drop in won-based trading volume, highlighting regulatory and market headwinds for memecoins and similar high-risk assets.
• Related incidents this year underscore ongoing risk in meme tokens, including high-profile rug pulls tied to social media-driven hype and influencer-linked projects.

CATFI’s rise and fall in context

CATFI briefly reached an all-time market capitalization of about $8.99 million in February 2025, but the subsequent rug pull and exit scam knocked the token back into a lurching decline. Data from Pump.fun indicates that, despite the collapse, a significant portion of investors—about 1,512 holders—still appear to be holding CATFI in hopes of recovery. The largest known address, a wallet labeled “5Q54,” reportedly held around 18% of the token’s supply at the time data was compiled. The project’s former promoter’s X (Twitter) account has since been deleted, reflecting the erasure of public-facing outreach tied to the campaign.

The legal action signals that authorities are increasingly willing to pursue coordinated manipulation cases in the memecoin space. Rug pulls—where developers promote a token to attract funds and then abruptly abandon the project—have long threatened retail investors, particularly in communities built around social media-driven hype. The CATFI case is positioned as a test of South Korea’s enforcement under evolving crypto consumer protection standards.

However, the CATFI saga is not isolated. In May, Cointelegraph reported on another Solana memecoin linked to Keith Gill’s Roaring Kitty persona that experienced a separate rug pull, with the anonymous developer cashing out about $729,000 while investors saw steep losses. The episode, alongside the CATFI case, underscores the volatility and risk profile of meme-oriented assets even as markets evolve and regulators scrutinize suspicious activity more closely.

For individual traders, the CATFI episode illustrates how quickly momentum-based tokens can flip from rapid gains to devastating losses. One trader reportedly saw a loss approaching six figures in a short period during a recent memecoin event, highlighting the real-world stakes involved in these crowded, speculative spaces.

Regulatory backdrop and market dynamics in South Korea

The CATFI case arrives amid a downturn in domestic digital asset trading activity. Digital Asset Works’ coverage notes that won-based exchanges have seen shrinking volumes, with overall activity in the Korean market growing more cautious in the face of regulatory scrutiny and increased risk awareness among investors. The development underscores a broader tightening environment where authorities emphasize consumer protection, anti-manipulation measures, and accountability for project teams behind high-risk tokens.

South Korea’s enforcement trajectory—with the CATFI investigation marking a potential precedent—could influence how future memecoin launches are treated under existing laws. While the case does not conclusively determine the long-term legality of memecoins themselves, it demonstrates that orchestrated price manipulation and exit schemes are increasingly susceptible to legal repercussions, potentially reshaping project funding dynamics and investor diligence in the domestic market.

What comes next for CATFI and the market

As prosecutors proceed with the case, observers will be watching how charges unfold, whether additional arrests follow, and what implications this may have for the broader memecoin ecosystem in South Korea. The outcome could influence how exchanges assess listing risk, how influencers disclose promotional activity, and how investors evaluate exit risk in hype-driven tokens. In the near term, CATFI’s holders face a challenging landscape: questions about potential refunds, recovery pathways for defrauded investors, and the sustainability of token liquidity in the wake of the rug pull remain unresolved.

Readers should watch for further updates from South Korean authorities as the investigation progresses, along with any court rulings that could redefine enforcement norms for memecoins and similar schemes. The CATFI case may serve as a bellwether for how regulatory regimes balance innovation and investor protection in a fast-moving, social-media-driven segment of the crypto market.

DMG Blockchain mined 69 bitcoin in its fiscal Q2 2026 but is betting its future on transforming those mining operations into AI-ready data centers serving Canadian government and enterprise demand.

According to its latest earnings release, DMG Blockchain Solutions generated 69 Bitcoin (BTC) in self-mining during the second quarter of fiscal 2026, essentially unchanged from the prior quarter but down about 25% compared to the same period a year earlier. The company reported revenue of $7.3 million, a 35% decline from $11.2 million in Q1 2026 and lower than the comparable quarter in 2025, reflecting both softer BTC economics and the deliberate winding down of legacy hosting revenue as it retools its business.

Management used the Q2 update to sharpen a strategic narrative that has been building for over a year: DMG is no longer just a bitcoin miner, but a vertically integrated data center and digital asset services firm that wants to sell AI compute as aggressively as it once sold hash rate. The company says its future operating model will revolve around two main segments, core data center operations and digital asset financial services, with AI infrastructure and services increasingly dominating the first bucket.

The uncomfortable question is whether a business that mined just 69 BTC in the quarter, roughly $4.8 million at a hypothetical $70,000 spot price, can realistically bankroll a capital-intensive AI pivot that involves modular data centers, high-end GPUs and stringent security requirements. DMG’s own disclosures show revenue down 35% quarter-on-quarter and a steady pattern of BTC liquidations to fund operations and capex; in April 2026, for example, the company mined 21 BTC, held 389 BTC at month-end, and explicitly noted that it had sold coins to cover expenses.

That tension between bitcoin-denominated cash flow and AI capex has been a recurring theme in DMG’s communications. In an August 2025 earnings commentary, Bennett described the company as “first and foremost a Bitcoin miner” but emphasized that “future bets lie in artificial intelligence,” with recent purchases of modular data center hardware framed as the first steps in “positioning DMG to expand into AI in a meaningful way.” The Q2 2026 report essentially doubles down on that thesis: mining remains the cash engine, but the story DMG wants public markets and Canadian policymakers to buy is that those 69 quarterly BTC are a down payment on a domestic AI infrastructure champion.

TLDR

• Bitwise Hyperliquid ETF recorded $19.05 million in daily investor inflows.
• Hunter Horsley confirmed the fund became the largest Hyperliquid ETF globally.
• Bitwise surpassed 21Shares in cumulative Hyperliquid ETF inflows.
• The ETF distributes 67% of staking rewards directly to investors.
• Bitcoin and Ethereum ETFs recorded $1.64 billion in combined outflows since May.

Bitwise confirmed its Hyperliquid ETF now leads the global market for HYPE-linked investment products. The Bitwise Hyperliquid ETF recorded $19.05 million in daily inflows, according to CEO Hunter Horsley. The fund also surpassed rival products after attracting strong institutional demand during its first weeks of trading.

The Bitwise Hyperliquid ETF reached $55 million in cumulative inflows after launching earlier this month. CEO Hunter Horsley shared the update through a public statement on social media.

The fund posted $22 million in daily trading volume during the latest session. Horsley said nearly all trading activity came from net inflows.

That structure reflected strong buyer demand throughout the session. It also showed limited selling pressure from larger market participants.

Bitwise overtook 21Shares in cumulative inflows during the recent trading period. The company now manages the largest Hyperliquid-focused exchange-traded fund globally.

The ETF sector linked to Hyperliquid currently holds $117.38 million in combined assets. However, Bitwise now controls the largest share of that market.

Bitwise Hyperliquid ETF Gains Market Share

Bitwise introduced native staking within the regulated ETF structure after launch. The company distributes 67% of staking rewards directly to investors.

The asset manager also removed management fees temporarily for early participants. That pricing strategy helped the ETF attract additional liquidity quickly.

Horsley described the inflow figures as a strategic achievement for the company. He also linked the result to Bitwise’s early positioning in emerging crypto assets.

The Hyperliquid ETF products launched in the United States roughly two weeks ago. Bitwise used that short launch window to expand market share rapidly.

The company also tied future business growth to the Hyperliquid ecosystem directly. Bitwise committed 10% of future management revenue toward HYPE token buybacks.

That mechanism links fund growth with demand for the underlying token. The structure also separates the product from many traditional crypto ETFs.

Hyperliquid ETF Sector Outpaces Bitcoin and Ethereum Funds

The Bitwise Hyperliquid ETF gained traction while major crypto ETFs faced capital withdrawals. Bitcoin and Ethereum ETFs recorded combined outflows of $1.64 billion since May 2026 began.

BHYP and THYP products moved against the broader market trend during that period. Investors shifted capital toward newer on-chain ecosystem products instead.

Bitwise said the ETF structure focused on regulated access and staking rewards. The company also emphasized exposure to the Hyperliquid ecosystem through the product.

Horsley confirmed the inflow data after the latest trading session closed. Bitwise currently remains the world’s largest manager of Hyperliquid-linked ETF assets.

• RAIN coin price has surged 63% to $0.01318, setting a new ATH.
• $100M liquidity plan ahead of V2 and World Cup is fueling demand.
• Key support sits at $0.011, with $0.010 as the downside risk level.

RAIN coin has recorded a sharp move in the past 24 hours, climbing 63.2% to $0.01324 and setting a new all-time high in the process.

The token’s trading activity also picked up meaningfully, with 24-hour volume rising more than 50% to over $39 million, signalling active participation rather than a thin-liquidity spike.

$100M liquidity plan is the main catalyst

The biggest driver behind RAIN’s move is a $100 million liquidity commitment tied to the upcoming Rain V2 protocol upgrade and expansion into event-driven markets ahead of the FIFA World Cup cycle.

According to details released by Rain Foundation, the liquidity package is split evenly into $50 million in USDT and $50 million in RAIN tokens.

This structure is designed to deepen trading pools and improve execution quality for users interacting with prediction markets on the platform.

The funding is also positioned to support market-making activity ahead of expected demand spikes tied to global sporting events.

The announcement also framed Rain as moving into a stronger competitive position within the sector, claiming it would rank among the top three prediction markets globally by total value locked (TVL), alongside established platforms such as Polymarket and Kalshi.

That positioning has added weight to the current rally, as traders increasingly price in a larger role for Rain in the prediction market sector heading into the V2 rollout.

Technical breakout confirms strong buying pressure

Beyond the fundamental catalyst, RAIN’s price action shows a clear technical breakout pattern.

The token moved from below the $0.008 region to above $0.013 within a short window, breaking through its previous all-time high near $0.01195 set on May 26, 2026.

The rally suggests aggressive buying rather than gradual accumulation.

Price acceleration occurred in stages, with early resistance levels failing to hold once liquidity expanded into the market following the announcement.

RAIN coin price forecast

RAIN coin is now trading in a stretched but strongly trending structure after breaking into new all-time highs.

The key technical level to watch on the downside is $0.011, which is the immediate support zone following the breakout.

If price continues to hold above that level with sustained volume, the next short-term resistance area sits around $0.0125, which aligns with recent intraday congestion during the breakout phase.

A stronger continuation move would require the market to maintain momentum above the current high region near $0.013, particularly if liquidity deployment updates from Rain Foundation are confirmed in the coming sessions.

On the downside, a clean break below $0.011 would weaken the current structure and open the door for a pullback toward $0.010, where earlier consolidation took place before the breakout accelerated.