U.S. spot Bitcoin ETFs attracted $233.1 million in net inflows on July 30, recording their strongest daily result in more than three weeks. 

BlackRock’s iShares Bitcoin Trust led the session with $183.4 million, according to Farside Investors’ daily flow table.

The inflow returned the funds to positive territory for both the week and July. However, the session represents renewed buying rather than proof of a lasting reversal. The SoSoValue Bitcoin ETF dashboard reported total net assets of about $78.76 billion after the July 30 session.

Bitcoin ETFs returned to positive weekly flows

BlackRock’s IBIT accounted for 78.7% of the daily total. Bitwise’s BITB followed with $20.7 million, while Fidelity’s FBTC added $15.5 million. Morgan Stanley’s MSBT received $7.4 million, VanEck’s HODL added $2.3 million and Grayscale’s Bitcoin Mini Trust recorded another $2.3 million.

ARK 21Shares’ ARKB added $1.5 million, while the remaining products recorded no flows. No fund reported a net outflow during the session, making the rebound broader than an IBIT-only increase, although BlackRock still supplied most of the demand.

The funds entered July 31 with about $203.9 million in weekly net inflows, based on Farside’s figures for Monday through Thursday. A Friday outflow larger than that amount would return the week to negative territory. Otherwise, the products would complete a fourth consecutive positive week.

However, Bitcoin ETFs began July by ending a ten-day withdrawal run with $221.7 million in inflows. Demand then strengthened and weakened several times, showing that institutional flows remained uneven rather than moving in one direction.

BlackRock’s IBIT controlled most of the rebound

IBIT’s $183.4 million inflow was its largest since July 6, when the fund attracted $209.4 million. That earlier session helped the broader ETF group collect $265.7 million, which remains July’s strongest daily result through July 30.

BlackRock’s official IBIT fund page listed $47.67 billion in net assets and almost 1.3 billion shares outstanding on July 30. The fund’s net asset value rose 1.26% that day to $36.68, while its Bitcoin benchmark stood at $64,764.70.

IBIT therefore represented more than 60% of the approximately $78.76 billion held across the U.S. spot Bitcoin ETF group. Its size means changes in BlackRock’s creations and redemptions can heavily influence the combined daily total.

As crypto.news reported earlier in July, IBIT’s return to inflows followed a prolonged period of weak activity and repeated withdrawals. The latest session extends that recovery, but BlackRock also recorded outflows on July 27 and July 28 before returning to positive flows.

July may end two months of Bitcoin ETF outflows

Farside’s daily figures show approximately $438.2 million in net Bitcoin ETF inflows from July 1 through July 30. SoSoValue’s total was slightly lower at about $437.8 million, reflecting small differences in data timing and calculation methods.

A positive July would end two consecutive months of withdrawals. Farside data indicate that the products lost about $2.41 billion in May and $4.51 billion in June. The July recovery has therefore regained only a small part of the capital removed during those months.

crypto.news examined the record 13-day outflow streak that removed approximately $4.37 billion between May 15 and June 3. Total ETF assets fell sharply during that period as redemptions combined with Bitcoin’s declining market price.

The latest daily inflow is constructive, but it remains modest compared with the fund group’s total assets. A longer sequence of positive sessions would provide stronger evidence that investors are rebuilding exposure rather than making short-term allocations.

Bitcoin’s price has not confirmed a wider reversal

Bitcoin traded near $63,144 on July 31, according to CoinGecko market data. Its 24-hour range extended from approximately $62,785 to $65,006, leaving the asset below the benchmark price used for BlackRock’s July 30 fund valuation.

ETF assets and Bitcoin’s price rose strongly through much of 2024 and 2025 before declining from their later peaks. The July 30 inflow interrupted a more inconsistent flow pattern, but one session cannot establish that the longer decline has ended.

ETF creations can support demand because authorized participants facilitate new fund shares and the trusts increase their Bitcoin exposure. However, Bitcoin also responds to derivatives positioning, macroeconomic conditions, exchange activity and sales by existing holders. ETF flows should therefore be treated as one market indicator rather than a standalone price signal.

Ethereum ETFs added a smaller $13M inflow

U.S. spot Ethereum ETFs also returned to positive daily flows. SoSoValue’s Ethereum ETF dashboard reported approximately $13.29 million in net inflows on July 30, led by BlackRock’s ETHA with $16.24 million.

Farside calculated a slightly lower group total of $12.8 million. Its table showed ETHA adding $16.2 million, while Fidelity’s FETH lost $2.9 million and Grayscale’s ETHE recorded $1.6 million in outflows. Smaller inflows into Bitwise’s ETHW and 21Shares’ TETH partially offset those withdrawals.

BlackRock’s official ETHA page listed $5.57 billion in net assets on July 30. Its NAV increased 1.11% to $14.50, while the fund’s Ether benchmark stood at $1,922.06.

The final July result will depend on flows recorded during the July 31 U.S. trading session. Investors will watch whether Bitcoin ETFs preserve their weekly and monthly gains and whether Ether products extend their more frequent July inflows.

AFX has announced that it has prepared a goodwill plan for users affected by last week’s $24.15 million bridge exploit, with the recovery proposal scheduled for release on Aug. 3.

According to an announcement shared by AFX, the decentralized derivatives protocol is finalizing a goodwill plan following the July 22 security incident and will publish the details on Monday, Aug. 3. The team said investors, employees and early supporters had all been affected by the attack and asked the community to remain patient while it completes the final proposal.

The update comes after AFX completed its technical investigation into the exploit, which resulted in the theft of about 24.15 million USDC from an AFX-operated custody bridge. The protocol has not yet disclosed how compensation or recovery will be structured, but said its next announcement will focus on the goodwill plan.

Earlier public statements confirmed the exploit targeted infrastructure operated by AFX rather than Arbitrum’s native bridge. At the time, blockchain security firm Blockaid and the Arbitrum team investigated the incident, while Offchain Labs co-founder Steven Goldfeder said the suspicious transaction originated from a third-party protocol instead of Arbitrum’s core bridge.

AFX says attack started with a developer

In a detailed post-mortem released after the incident, AFX said the breach originated from a social engineering campaign against one of its developers rather than a vulnerability in its smart contracts or blockchain infrastructure. According to the protocol, the attacker posed as a recruiter from a company called Oddium Lab on July 9 and convinced the developer to clone what appeared to be a legitimate software repository.

AFX said the repository contained a malicious Git configuration that executed a hidden payload during a routine Git workflow, giving the attacker an initial foothold inside the developer’s workstation. Using the compromised device, the attacker gradually expanded access across internal development systems before downloading project source code several days later.

The investigation said the attacker later uploaded a malicious Groovy plugin into the protocol’s JFrog artifact repository, obtaining remote code execution inside the software delivery environment. According to AFX, repeated out-of-memory events on the JFrog server were initially treated as operational problems with assistance from the vendor, allowing the malicious plugin to survive multiple restarts without triggering a security response.

Forensic analysis later found that the attacker had replaced system binaries with trojanized versions, injected malicious shared libraries and attempted to erase security logs before portions of the malware crashed. SELinux logs captured outbound command-and-control traffic, shell execution and in-memory code execution that became important evidence during the investigation, according to the report.

Validator compromise enabled the bridge theft

The protocol said the attacker eventually pivoted from the compromised development environment into its operational infrastructure using an internal Ansible-based management service that already held privileged access to validator nodes. Rather than stealing new credentials or exploiting an external service, the attacker used existing trust relationships to deploy malicious payloads across a subset of validators.

AFX said the infected validator nodes downloaded a second-stage payload from a remote server before interfering with consensus-message handling. At 9:27 p.m. UTC on July 22, the affected validators co-signed a bridge transaction that transferred roughly 24.15 million USDC from the AFX-operated custody bridge.

The protocol said its investigation found no evidence that the Arbitrum network or Arbitrum’s native bridge had been compromised. The attack remained confined to infrastructure managed by AFX, matching statements previously issued by Offchain Labs and Blockaid during the initial response.

On-chain investigators later tracked the stolen USDC after it moved from Arbitrum to Ethereum, where the proceeds were converted into approximately 12,467 ETH. At the time of the initial investigation, no public reports confirmed that any portion of the stolen assets had been recovered.

Investigation points to supply chain compromise

According to AFX, the incident demonstrated that software supply chain attacks can bypass blockchain security without exploiting smart contracts directly. The protocol concluded that the attack relied on trusted development tools, internal deployment systems and validator infrastructure instead of weaknesses in on-chain code.

The report said the protocol has rebuilt affected infrastructure, rotated operational credentials, increased monitoring sensitivity and migrated production systems into a more isolated environment with zero-trust segmentation. Additional work planned over the coming months includes stronger behavioral monitoring, mandatory security reviews before restarting production services, expanded threat-hunting exercises and employee training against social engineering attacks.

Based on forensic evidence, attack techniques and infrastructure observed during the investigation, AFX said its findings are consistent with independent attribution linking the incident to UNC4899, also known as TraderTraitor, a DPRK-linked threat group tracked by Mandiant, Microsoft Threat Intelligence, the FBI and CISA. The protocol said it continues working with external security partners to trace the stolen assets and support ongoing response efforts.

Off-chain attacks have surfaced in multiple DeFi exploits

The latest findings add to a series of incidents in which protocols have concluded that attackers compromised supporting infrastructure instead of exploiting flaws in smart contracts.

On July 30, Ostium said its investigation into a separate 23.75 million USDC exploit found that unauthorized access to off-chain infrastructure allowed fraudulent BTC-USD price reports to drain funds from its liquidity vault, while its smart contracts and governance multisigs remained uncompromised. 

Earlier this month, Singapore-based stablecoin payments firm Triple-A also disclosed unauthorized access to treasury wallets holding company-owned digital assets, although it said customer funds and payment operations were unaffected.

Blockchain asset management protocol Swan Treasury has suffered an estimated $625,000 loss after attackers exploited a leaked off-chain signer key to buy STY tokens at a steep discount before selling them for profit.

According to blockchain security firm Defimon Alerts, the exploit took place on BNB Chain after the protocol’s off-chain signer key, hardcoded as the _signer address in the ZhaiquanBuy contract, was compromised.

The attacker used the leaked key to generate valid signatures for their own wallet, allowing them to bypass the protocol’s intended purchase restrictions.

Swan Treasury exploit relied on leaked signer key

Defimon Alerts said the attacker manipulated the buy() function, which calculates the amount of STY a user receives based on a signed discount value. By generating a valid signature with the discount parameter set to one, the attacker purchased STY at roughly one-hundredth of its intended price.

Using a PancakeSwap flash loan worth about 19,700 USDT, the attacker acquired nearly 687,000 STY tokens through the discounted purchase mechanism.

The security firm said the exploit did not stop there. Valid signatures were also forged for the protocol’s claim() and transfer() functions on related contracts, giving the attacker additional access to STY before selling the tokens into the STY/USDT liquidity pool.

After unwinding the position, the attacker realized about 625,000 USDT in profit, according to Defimon Alerts.

STY traded at approximately $2.87 at the time of the incident, the firm’s alert noted.

Transaction analysis points to a compromised private key

In its technical assessment, Defimon Alerts said every ecrecover operation observed during the exploit resolved to the protocol’s hardcoded signer address rather than any attacker-controlled account.

The firm said this behavior indicates the private signer key itself had been compromised instead of the protocol containing a flaw in its signature verification logic. Because the generated signatures matched the expected signer exactly, the transactions appeared valid to the affected smart contracts.

The finding narrows the likely cause of the exploit to unauthorized access to the protocol’s signing credentials rather than an error in the cryptographic verification process.

At the time of publication, Swan Treasury had not publicly explained how the signer key was exposed or whether additional mitigation measures had been implemented.

Private key compromises continue to drive crypto losses

The incident adds to a series of crypto attacks in which compromised privileged keys, rather than smart contract bugs, allowed attackers to access protocol funds.

In June 2025, blockchain security company Hacken disclosed that a compromised private key tied to a contract with minting privileges enabled an attacker to create 900 million HAI tokens across Ethereum and BNB Chain. 

Hacken said the key was exposed while the company was making architectural changes to its blockchain bridge infrastructure, allowing the attacker to realize about $250,000 before the affected minting account was revoked and bridge operations were paused.

Separate research has also continued to identify private key exposure as one of the industry’s most persistent security risks. A Hacken report cited by crypto.news previously found that access control failures, including private key leaks, accounted for 78% of crypto hack losses recorded during 2024.

More recently, Zilliqa disclosed a flaw in its native Ledger application that could allow attackers to recover private keys from public transaction signatures. The network suspended native ZIL transactions after determining that a weakness in nonce generation made it possible to reconstruct affected keys once enough signatures had been collected. 

Zilliqa said the issue stemmed from its own Ledger application rather than Ledger hardware itself and instructed affected users to wait for recovery guidance instead of moving funds immediately.

Security researchers continue warning about key exposure

Academic researchers and crypto industry players have likewise warned that private key security remains vulnerable outside traditional smart contract exploits.

Researchers from the University of California reported earlier this year that some third-party AI routing services were capable of accessing sensitive credentials, including cryptocurrency private keys and seed phrases, because they process user requests in plaintext. 

During controlled testing, the researchers observed malicious behavior from several routing services and demonstrated that one intermediary successfully drained Ether from a test wallet after receiving its private key.

While the university study was unrelated to the Swan Treasury incident, the researchers concluded that developers should avoid exposing private keys or seed phrases to intermediary systems and instead rely on stronger cryptographic protections to reduce credential theft risks.

Bitcoin miners entered one of their longest periods of contraction by July 31, even as shares of several listed operators climbed on expectations for AI data-center revenue.

Bitcoin Magazine Pro calculated that mining difficulty had fallen 19.9% from its peak, making the decline the third deepest since application-specific integrated circuits replaced graphics processors as the industry’s main hardware.

Independent network data confirm the broader contraction. Bitcoin’s difficulty fell 0.74% on July 25 to 126.23 trillion after a larger 5% cut on July 11. The current level is about 19% below the record of roughly 156 trillion set in November 2025.

Bitcoin traded near $63,100 on July 31, down about 47% over 12 months and almost 50% below its October 2025 record. That price decline has reduced dollar revenue for miners while the protocol continues issuing only 3.125 BTC per block.

Bitcoin miner capitulation is visible in network data

Bitcoin’s seven-day average hashrate stood near 868 exahashes per second on July 29, down from more than one zettahash per second at its late-2025 peak. Hashrate Index placed the broader 30-day measure near 940 EH/s in its third-quarter review, about 12% below the December record of 1,066 EH/s.

Different data providers use different averaging windows, so they may not identify the same starting date for the decline. Bitcoin Magazine Pro’s claim that the drawdown had lasted 287 days reflects its chosen hashrate series. The precise duration may vary, but the downward direction is clear across public datasets.

NEAR Protocol has launched a staking-based payment system for its AI platform, allowing users to access confidential inference and autonomous AI agents by locking NEAR tokens instead of paying with a credit card.

According to an announcement published by NEAR Protocol on X, the new feature converts staked NEAR into monthly compute credits that can be used across the platform’s artificial intelligence services. 

Quantum Solutions and Hyperscale Data each redirected part of their crypto treasuries toward AI data centers on July 30. 

Tokyo-listed Quantum sold 1,000 ETH for $1.903 million, while U.S.-listed Hyperscale monetized about 100 BTC and established a Bitcoin-backed credit facility.

The transactions show two approaches to using digital assets as operating capital. Quantum converted Ethereum directly into cash. Hyperscale combined a Bitcoin sale with collateralized borrowing to finance its Michigan AI data center.

Quantum Solutions converts ETH into AIDC funding

Quantum’s subsidiary GPT Pals Studio sold 1,000 ETH at $1,903 per token, generating $1.903 million after transaction fees. The company expects to record a $100,970 loss, equal to about ¥17 million, because the sale price was below its May 31 carrying value of $2,003.97 per ETH. The accounting loss is not measured against the original purchase price.

The July transaction followed a June 16 sale of 904 ETH for about $1.61 million. Together, the two disposals raised roughly $3.51 million and reduced Quantum’s balance from 6,668.8 ETH to 4,764.8 ETH, a decline of about 28.6%.

Quantum increased its cumulative sale limit from 1,875 ETH to 4,375 ETH through October 30. The company may therefore sell another 2,471 ETH. However, its filing states that the higher ceiling “does not constitute a decision to immediately sell” the full amount. Future transactions will depend on ETH prices, funding requirements and progress in the AI Infrastructure Data Center business.

Most of Quantum’s remaining ETH is pledged

Of Quantum’s remaining 4,764.8 ETH, 3,050 ETH is pledged as collateral to a Singapore-based financial services company. Another 1,714.8 ETH remains in GPT Pals’ crypto trading account. The company has not identified the lender publicly.

The unused sale authorization exceeds Quantum’s freely held trading-account balance by 756.2 ETH. Selling the full authorized amount would therefore appear to require the release or replacement of some collateral, additional ETH purchases or another arrangement. Quantum has not announced plans to take any of those steps.

The sale also changed Quantum’s position among Japanese corporate Ethereum holders. Def Consulting reported 4,976 ETH on June 30, which is 211.2 ETH more than Quantum’s post-sale balance. Based on the companies’ latest disclosed figures, Quantum no longer appears to be Japan’s largest listed ETH holder, although the balances were reported on different dates.

Ascrypto.news previously reported, Quantum had become the largest Ethereum treasury company outside the U.S. after rapidly accumulating ETH in October 2025. Its latest disposals mark a shift from treasury expansion toward business funding.

In addition, Quantum said the proceeds would support data center contracts, GPU equipment and preparations for its AIDC business. In June, it signed a memorandum of understanding with Hong Kong-based Integrated Capital to examine financing and resource cooperation for a Japanese AI data center.

The proposed infrastructure would focus on systems using NVIDIA B300 and GB300 GPUs. However, the memorandum is nonbinding. Quantum said “specific investment amounts, financing conditions and implementation timing remain undecided.” The ETH sales therefore provide capital flexibility but do not confirm that a completed data center investment has been agreed.

Hyperscale Data monetizes 100 BTC for Michigan

Hyperscale Data separately said it monetized approximately 100 BTC and invested the proceeds into its Michigan AI data center campus. The company also created a Bitcoin-backed facility with an expected variable interest rate of 4.5% to 5%.

The release did not identify the lender, borrowing limit, maturity, collateral ratio or amount of Bitcoin pledged. Hyperscale had reported 1,106.0467 BTC on July 27, valued at about $71.7 million. Subtracting the stated sale would leave roughly 1,006 BTC, but that figure is an estimate because the company has not disclosed a precise post-transaction balance.

Hyperscale is building capacity for a neocloud provider under a definitive master services agreement. The initial deployment covers about 20 megawatts and has a ten-year term with two optional five-year extensions. The company estimates that the maximum term could produce more than $1.2 billion in revenue.

The customer also has an option for another 32 MW. Hyperscale said the expanded arrangement “would be expected” to raise total contract revenue above $3 billion if the capacity and extension options are exercised. Those amounts are conditional forecasts, not revenue already earned.

Crypto treasuries become operating finance tools

The announcements show digital-asset treasuries moving beyond passive holding. Quantum is selling ETH to fund a project that remains at an early stage. Hyperscale is selling and borrowing against Bitcoin to support a data center tied to a signed customer agreement.

The model is spreading across crypto-linked infrastructure companies. In related coverage, Core Scientific sold 2,385 BTC during the first quarter to fund AI capital expenditure. Crypto.news also found that listed miners had secured more than $70 billion in announced AI and high-performance computing contracts while selling Bitcoin to cover development costs.

Quantum’s next deadline is October 30, when its expanded ETH sale authorization expires. The company has promised disclosures if it makes additional sales and expects to recognize the ¥17 million loss in its fiscal second quarter.

Hyperscale said it will issue further construction, financing and operational updates. Investors will be watching for the credit facility’s full terms, an updated Bitcoin balance and evidence that planned Michigan capacity is delivered according to schedule.

Bitcoin Archive renewed a long-running dispute over Bitcoin self-custody on July 31, arguing that poor wallet usability is sometimes defended as cultural gatekeeping rather than treated as a barrier to adoption.

The account said a “large contingent” of Bitcoin maximalists “do NOT care about mainstream adoption” and described difficult self-custody experiences as “elitism dressed up as virtue.” Its July 31 post named no individuals, products or organizations and provided no data supporting its claims. It should therefore be read as commentary, not a verified finding about the wider Bitcoin community.

Bitcoin self-custody UX remains the core dispute

Self-custody lets a Bitcoin holder control the private keys needed to move funds. That removes dependence on an exchange or custodian, but it also shifts recovery, backup and transaction-verification duties to the user. A lost backup or exposed recovery phrase can result in permanent loss.

Bitcoin Core’s wallet documentation warns that forgotten passphrases cannot be recovered and that backup files must remain reliable and free from malware. Those instructions show that the usability and responsibility trade-off predates the latest culture debate.

Bitcoin Archive’s criticism focuses on how that responsibility is communicated. Its claim that technical difficulty is intentionally preserved as gatekeeping is disputed and cannot be established from the post alone.

Research supports usability concerns, not motive claims

Academic evidence supports the narrower point that wallet concepts remain difficult for many users. Carnegie Mellon researchers said only 43% of participants correctly identified an image of a seed phrase, while some believed a lost phrase could be reset. The findings pointed to weak mental models that can increase exposure to scams and accidental loss.

A separate CHI study of 24 crypto users found that wallet choices varied by use case, experience and perceived risk. Participants often preferred hardware or smart-contract wallets for larger sums, showing that users balance convenience, phishing exposure, physical risk and dependence on third parties.

A 2026 Scientific Reports paper also described self-custody users as a potential single point of failure and called inadequate recovery a continuing wallet problem. 

Separately, the Bitcoin Design guide recommends clear explanations, backup confirmation and recovery testing rather than assuming users already understand key management.

Wallet makers are testing different recovery models

Several products now try to reduce seed-phrase dependence without returning full control to a custodian. Bitkey’s updated recovery documentation describes a two-of-three key design using an app key, hardware key and server key. Any two keys can authorize actions, while the company says its server key cannot move funds alone. Recovery Contacts can also help restore access without receiving the wallet’s keys.

Ledger offers several options, including a PIN-protected physical Recovery Key and the optional Ledger Recover subscription. Ledger says Recover encrypts and splits backup material among three providers, with identity checks used during restoration.

Proton Wallet takes another approach by simplifying transfers through email addresses while retaining a standard wallet seed phrase. These are company-described models, and each introduces different privacy, availability and trust considerations.

Security failures keep the trade-off unresolved

Easier recovery does not remove the need for secure wallet generation and user education. In related coverage, crypto.news reported that the Ill Bloom weakness exposed wallets created with poor randomness across several blockchains.

Crypto.news also reported on physical phishing letters designed to trick Ledger and Trezor users into revealing recovery phrases. These cases show that improving the interface cannot fully remove weak randomness, social engineering or backup exposure.

Self-custody removes the risk that an exchange freezes withdrawals, fails or mismanages customer assets. It does not remove phishing, device compromise, backup loss or inheritance problems. As crypto.news explained in its self-custody guide, control and responsibility arrive together.

What happens next will depend on measurable product work rather than social-media arguments. Wallet developers can publish audits, test recovery flows with nontechnical users, support interoperable backups and report failure rates. Bitcoin Archive’s broader allegation about maximalist culture remains opinion, but the underlying usability challenge is documented and actively being addressed.

KSNet has partnered with the Solana Foundation to test blockchain payments and AI-driven transaction systems for South Korea’s financial market.

KSNet announced on July 30 that it has signed a memorandum of understanding (MOU) with the Solana Foundation to jointly develop a next-generation digital asset payment infrastructure, with the partnership beginning through proof-of-concept projects focused on Solana Pay and AI-powered payment technology.

The agreement brings together KSNet’s domestic payment network and Solana’s blockchain infrastructure as both companies evaluate digital asset payments that can work alongside South Korea’s existing financial system. The first phase centers on technical verification rather than a commercial rollout.

Solana Pay will be tested on KSNet’s merchant network

As part of the first proof-of-concept, KSNet said it will test the integration of Solana Pay with the online and offline merchant payment network the company has built over the past 26 years. The demonstration will examine whether Solana Pay’s payment standard can operate within South Korea’s existing payment environment while remaining compatible with local merchant infrastructure.

The companies also said compliance requirements will form part of the testing process. KSNet plans to incorporate anti-money laundering (AML) controls into the payment system to prevent abnormal fund flows before any commercial deployment is considered.

In addition, the proof-of-concept will connect blockchain-based settlements with KSNet’s existing won settlement network. According to the company, the structure is intended to comply with domestic financial guidelines while reducing exchange-rate fluctuations and liquidity risks that can arise during digital asset settlements.

Rather than replacing traditional payment rails, the companies are testing how blockchain payments can operate alongside existing financial infrastructure under domestic regulatory requirements.

AI payment model will use the x402 protocol

A second proof-of-concept under the agreement focuses on artificial intelligence payments using the x402 protocol.

KSNet said it will evaluate the protocol by integrating it into an AI-based payment system that is already undergoing internal testing. The review will determine whether the technology is suitable for future payment services that rely on autonomous software agents.

The x402 protocol uses the HTTP 402 “Payment Required” status code, allowing AI agents to make small payments automatically when accessing APIs or paid online services without relying on conventional logins or credit card authentication.

According to the companies, machine-to-machine payment models require transactions to settle quickly while keeping processing costs low. Existing card payment systems have long faced cost challenges when handling very small payments because multiple intermediaries contribute to the overall fee structure.

The proof-of-concept will therefore examine whether blockchain infrastructure can support those payment models more efficiently while remaining compatible with existing financial systems.

Park Han-han, chief executive officer of KSNet, said the company plans to build on its payment and settlement experience to provide what it described as a secure payment infrastructure for users.

Following the technical validation, KSNet and the Solana Foundation said they intend to gradually explore commercialization models suitable for South Korea’s financial market.

Solana has continued expanding payment partnerships

The KSNet partnership adds another enterprise payments initiative to the Solana Foundation’s recent activities across financial services.

Earlier this month, the Solana Foundation partnered with SBI Holdings to establish SBI Solana Global, a venture focused on regulated on-chain financial infrastructure in Japan. According to the companies, the initiative includes work on yen-backed stablecoins, tokenized financial products, institutional settlement services, cross-border payments, and AI-related payment applications.

South Korea has also become part of Solana’s payment strategy. In April, Shinhan Card announced a proof-of-concept with the Solana Foundation to test stablecoin payments on Solana’s testnet. According to Shinhan Card, the pilot evaluates transaction performance, non-custodial wallet security, and blockchain payment infrastructure while examining hybrid financial services that combine conventional payment systems with decentralized finance.

Artificial intelligence has become another area of development for the blockchain network. Earlier this month, the Solana Foundation and Google Cloud introduced Pay.sh, a payment gateway that allows AI agents to purchase API access using stablecoins on Solana. According to the companies, the platform enables per-request payments for Google Cloud services, including Gemini, BigQuery, and Vertex AI, without requiring traditional API subscriptions.

Enterprise adoption has also extended into corporate finance. On July 22, Ramp launched Solana-powered stablecoin accounts that allow businesses to hold USDC and USDT, manage treasury balances, and make cross-border payments through a single financial workflow. Ramp said more than 70% of stablecoin payment volume on its platform occurs outside traditional banking hours, indicating continued demand for around-the-clock settlement.

Consumer payment products have also incorporated Solana’s infrastructure. Last year, Gemini introduced a Solana Edition credit card that automatically stakes SOL rewards earned from purchases, allowing users to participate in network validation while earning staking rewards through Gemini’s platform. 

The launch followed the exchange’s addition of USDC and USDT transfers on Solana, which Gemini said benefited from the network’s low fees and fast settlement times.

Ethereum price fell nearly 2% to about $1,883 on July 31 after another rejection below $2,000 weakened momentum and pushed the token toward a key technical support zone.

Ethereum price action today

According to data from crypto.news, Ethereum (ETH) price extended its retreat on Thursday after buyers failed to sustain a move toward the $2,000 psychological level.

The token traded at approximately $1,883 at the time of the charts, down 1.82% on the day. ETH reached an intraday high of $1,936 before falling to a low near $1,878, showing that sellers remained active above $1,900.

Price action on the 4-hour chart shows Ethereum breaking below the middle Bollinger Band at $1,906. The move placed ETH close to the lower band at $1,875, where buyers may attempt to stabilize the decline.

Short-term momentum has also deteriorated. The 4-hour Relative Strength Index fell to 43.02, below its moving average of 50.13. An RSI below 50 generally indicates that sellers have gained control, although the reading remains above the oversold threshold of 30.

Ethereum’s retreat follows several failed attempts to establish support above $1,930. Each rebound produced renewed selling, leaving the token inside a broader consolidation range instead of confirming a breakout.

What is driving the ETH decline?

Profit-taking near $1,950 and the continued defense of $2,000 appear to be the immediate technical drivers behind the decline.

The $2,000 level also sits close to the 50% Fibonacci retracement at $1,986.33 on the daily chart. That overlap has created a wider resistance zone where short-term traders may be closing positions rather than adding exposure.

Derivatives positioning likely amplified the pullback. The 3-day CoinGlass liquidation heatmap shows that ETH dropped sharply after trading around $1,920, passing through liquidity near $1,900 before reaching the upper $1,880s.

Leveraged traders who positioned for an immediate breakout above $2,000 faced pressure as the price moved in the opposite direction. Forced long closures can accelerate a decline because exchanges sell the underlying position when margin requirements are no longer met.

Broader conditions remain challenging for risk assets. The Federal Reserve’s decision to maintain elevated interest rates has kept financing conditions restrictive for US investors, while geopolitical uncertainty in the Middle East has supported a more defensive market posture.

Ethereum has also lacked the sustained spot demand needed to separate from those macro pressures. Weak on-chain activity and redemptions from spot Ethereum exchange-traded products have reduced two potential sources of buying support.

Ethereum support at $1,873 faces a test

Ethereum is now testing an important technical area between $1,873 and $1,875.

The daily chart places the 0.618 Fibonacci retracement at $1,873.50, while the 4-hour lower Bollinger Band stands at $1,875.19. The convergence makes this range the first level bulls need to defend.

A daily close below $1,873 would weaken the recovery structure that developed from the late-June low. The liquidation heatmap points to additional liquidity between approximately $1,850 and $1,870, making that area the next potential downside target.

Below $1,850, attention would shift toward $1,800. Losing that psychological support could expose the 0.786 Fibonacci retracement at $1,712.86, although ETH would need a much deeper correction to test that level.

Some longer-term indicators remain constructive. Chaikin Money Flow stood at 0.08 on the daily chart, suggesting capital flows were still marginally positive despite the price decline. The Aroon readings also showed Aroon Up at 71.43 and Aroon Down at zero, indicating that the broader July recovery had not been fully invalidated.

Those signals contrast with the weaker 4-hour RSI, showing a market in which the medium-term recovery remains intact but near-term momentum favors sellers.

Liquidation heatmap points to $1,940 resistance

The largest nearby concentration of liquidation leverage sits around $1,935–$1,940, according to the 3-day heatmap.

That cluster could act as a price magnet if Ethereum rebounds from current support. A recovery above $1,906, the middle Bollinger Band, would be the first indication that short-term momentum is improving.

ETH would then face resistance at $1,938, which marks the upper Bollinger Band and overlaps with the main liquidation pocket. Clearing that area could open another test of $1,986 and $2,000.

Additional liquidity appears near $1,950–$1,965 and immediately below $2,000. These clusters could fuel a short squeeze if buyers reclaim $1,940, but they may also attract fresh selling as traders defend the wider resistance zone.

Failure to recover $1,900 would keep the downside scenario active. In that case, leveraged positions accumulated around $1,875 and $1,850 could become vulnerable.

What analysts are saying about Ethereum

Crypto analyst Michaël van de Poppe described the current decline as a lower-timeframe correction while maintaining a positive longer-term view.

“ETH is holding above $1,800 and as long as that’s the case, there’s not much to worry,” van de Poppe said. He added that he still expects Ethereum to reach $2,500 in the coming months.

Analyst Ted Pillows identified a narrower support range. He said momentum was weakening after ETH fell below $1,900 but noted that the token remained above its $1,850 support zone.

“As long as it holds, I think ETH is more likely to rally towards $2,000.”

The charts therefore place Ethereum at a decision point. Holding $1,873–$1,850 would preserve the possibility of another move toward $1,940 and $2,000. A sustained breakdown below that range would instead reinforce the rejection and raise the risk of a deeper pullback toward $1,800.

The state is seeking at least $36 billion in damages from the prediction market platform it calls an unlicensed gambling operation, and has filed for a temporary restraining order to halt its contracts immediately.

The lawsuit that prediction markets knew was coming

Two days after the Second Circuit denied Kalshi emergency relief on July 29, New York filed the most aggressive state action yet against the prediction market industry. The suit arrived with a coordinated announcement from AG James and Governor Hochul, counts spanning multiple bodies of state law, a $36 billion damages demand, and a motion for an immediate restraining order.

The $36 billion figure, reported by The Block based on the court filings, is roughly 1.6 times Kalshi’s reported valuation. It is the number every major outlet is leading with, and it signals that New York is treating this as a revenue-extraction case, not merely a cease-and-desist.

This piece examines the filing, the legal arguments on both sides, the federal regulator caught between them, and what the case means for an industry now fighting a war on two fronts: in courtrooms and in Congress.

What the complaint actually alleges

The core claim is straightforward: Kalshi is running an unlicensed gambling business in New York.

The AG’s office says the platform lets users place wagers on uncertain future events, from Super Bowl outcomes to reality TV winners to election results, without a Gaming Commission license and without paying state gaming taxes. New York treats these as bets, not derivatives, regardless of Kalshi’s CFTC registration.

The complaint goes further. It alleges Kalshi allows users aged 18 to 20 to place bets, violating New York’s 21-and-older minimum for mobile sports betting. It alleges the platform offered wagers on games involving New York college teams, a separate violation under state law.

The AG’s investigators placed test wagers from New York accounts as evidence: four “Yes” contracts on a UConn-Michigan basketball game at $1.14 in April 2026, and ten contracts on the winner of “Big Brother” in July 2026. Both transactions completed without obstruction.

The filing also introduces a count under the federal Interstate Wire Act, alleging Kalshi used wire communications to transmit bets across state lines. This is significant because it widens the legal exposure beyond state gambling statutes into federal criminal law, giving the state an argument that operates independently of the preemption question. Even if Kalshi’s CFTC registration were found to preempt state gambling law, the Wire Act is a federal statute, and the state is arguing that Kalshi violates it.

The complaint details the investigative methods in unusual specificity. Rather than relying on industry reports or third-party data, the OAG built its case from the inside. Investigators created accounts, placed real wagers, and documented each step. This matters for the TRO motion: the state can present firsthand evidence that illegal gambling is actively occurring in New York, not merely that it could occur.

“Prediction markets like Kalshi are gambling platforms, plain and simple,” James said in a statement accompanying the filing.

Governor Hochul framed the action around consumer protection, saying Kalshi “has chosen to ignore New York’s gaming laws, which exist to protect consumers, prevent problematic gambling, deliver funding for critical public services, and ensure that every company plays by the same rules.” The coordinated announcement from both the AG and the Governor signals that this is not a routine regulatory action. It is a political priority.

The $36 billion in damages and the TRO

New York is not seeking a slap on the wrist. The headline number is at least $36 billion in compensatory damages, pending a full accounting of Kalshi’s operations. The remedies demand:

• A permanent injunction barring Kalshi from operating unlicensed gambling in the state
• A temporary restraining order halting Kalshi’s event contracts in New York immediately
• A full accounting of every customer bet and loss processed through the platform
• Forfeiture and disgorgement of all gains the state deems illegal
• Restitution to affected consumers
• Penalties of three times Kalshi’s gains under Penal Law Section 80.10
• A fine of $100,000 per unauthorized sports wagering offer under the Racing Law

The TRO is the near-term threat. If granted, Kalshi would need to suspend operations in New York while the case proceeds, potentially for years. The triple-damages provision is the long-term one. At $36 billion, New York is claiming a figure that exceeds the platform’s reported valuation of $22 billion by more than 60%.

The per-offer fine structure adds another layer. The AG’s release notes that Kalshi users bet over $1 billion monthly in 2025, with 90% of that volume on sports. Each unauthorized sports offering carries a $100,000 fine under the Racing Law. At that volume, the per-offer penalties alone could produce a figure in the hundreds of millions.

The damages calculation itself reveals the state’s theory of the case. New York is not treating Kalshi as a minor regulatory violator that failed to file paperwork. It is treating Kalshi as a gambling operation that processed billions in unlicensed wagers over multiple years, and it wants the full economic benefit of that activity returned. The $36 billion figure presumably reflects the total volume of wagers placed by New York users, or a substantial fraction of it, multiplied by the treble-damages provision. The final number will depend on the full accounting the state is requesting, but the opening demand is meant to establish the scale of the alleged violation.

The TRO motion deserves separate attention because it operates on a different timeline from the main case. A TRO hearing can happen within days or weeks, while the underlying lawsuit could take years. If New York secures the restraining order, Kalshi faces an immediate operational decision: comply and lose the New York market, or challenge the order and risk contempt proceedings. Either outcome sets a precedent that other states can follow. Michigan and Nevada secured their own TROs through similar procedural mechanisms, and each one reduced Kalshi’s geographic footprint.

The $1 billion monthly number and why it matters

The AG’s release includes a figure that has received less attention than the $36 billion headline: Kalshi users bet over $1 billion every month on the platform in 2025, and 90% of that money went to sports betting.

This is the number that makes the bipartisan Senate proposal to ban CFTC-licensed platforms from offering sports event contracts existential. Sports are not a side product for Kalshi. They are the product. If sports contracts are removed, whether by state enforcement or federal legislation, the platform loses nine-tenths of its recorded consumer activity.

The figure also undercuts Kalshi’s framing of its offerings as sophisticated financial derivatives. A billion dollars a month on the Super Bowl, the NBA, and college basketball looks like a sportsbook by any name. New York is making exactly that argument, and the AG’s investigators have the receipts.

The concentration matters for investors and market participants as well. Kalshi’s $22 billion valuation implies a diversified event-contract platform serving a range of use cases: elections, weather, economics, entertainment. The AG’s data shows something closer to a sports gambling platform with a derivatives label. If the valuation was underwritten on the assumption of product diversity, the 90% sports concentration represents a disclosure risk independent of the legal outcome.

Kalshi’s federal preemption defense

Kalshi’s position rests on a single legal premise: that its 2020 registration with the CFTC as a designated contract market means its event contracts are regulated derivatives under the Commodity Exchange Act, subject to exclusive federal oversight.

The company calls the suit “political theater” and argues states cannot simply shut down a federally licensed exchange. The framing is deliberate. Kalshi wants this treated as a jurisdictional question, not a gambling question.

It is the strongest version of their argument, and it carries legal weight. The CFTC itself has backed the position, filing lawsuits against multiple states and claiming exclusive regulatory authority over prediction markets. On the same day New York filed its suit, the CFTC filed an emergency counter-motion in Manhattan federal court less than one hour before the state complaint dropped, attempting to reassert federal jurisdiction preemptively.

The federal regulator has now challenged state enforcement in at least nine states, including filing suit against Arizona, Connecticut, and Illinois in April 2026. The CFTC is not a passive bystander in this dispute. It is an active combatant on Kalshi’s side.