Humanity Protocol has confirmed it is repositioning toward enterprise artificial intelligence products after a $36 million exploit accelerated an internal strategic overhaul that had already been under discussion for months.

During a recent interview, Humanity Protocol founder Terence Kwok said the company had been reconsidering its long-term direction for the past six to nine months and that the June security breach pushed those plans forward sooner than expected.

Enterprise AI takes priority after hack

Rather than continuing to present itself primarily as a blockchain identity platform, Kwok said Humanity Protocol will increasingly focus on building products and services for enterprise AI customers. He explained that digital identity remains an important part of the company’s work because AI systems will require stronger methods of verifying people and credentials.

Kwok said the team has already been testing products designed for AI companies and plans to introduce additional enterprise-focused offerings. Humanity Protocol previously developed a proof-of-personhood blockchain supporting credentials for employment, assets, and credit scoring, including work with Mastercard on proof-of-assets applications. 

According to Kwok, the platform has registered around 10 million users, with a couple of million completing their credentials.

The strategic change follows one of the project’s biggest setbacks. Humanity Protocol lost roughly $36 million after attackers gained access to critical private keys, triggering a sharp collapse in the H token and forcing the project into recovery mode.

Recovery efforts continue as token migration moves ahead

Discussing the aftermath of the attack, Kwok said the chances of recovering the stolen funds are “pretty low,” adding that the team’s attention has instead turned to rebuilding the ecosystem. He compared the situation with Bybit’s unsuccessful efforts to recover approximately $1.4 billion worth of ether stolen in a separate attack last year.

As part of the recovery process, Humanity Protocol has issued a replacement token and distributed it to a range of addresses, including major cryptocurrency exchanges. Kwok said discussions are continuing around snapshot dates, suspended deposits and withdrawals, liquidity pools and custodian arrangements, while investigators work to identify every transaction that took place after the breach before completing compensation claims.

Law enforcement agencies in multiple jurisdictions, beginning with Hong Kong alongside authorities in the United States, have also been contacted as investigations continue, according to Kwok.

Earlier findings released by Humanity Protocol and security firm Quantstamp attributed the exploit to compromised private keys stored on a developer device rather than vulnerabilities in the project’s smart contracts. 

The June investigation concluded that attackers obtained control of production systems after malware infected a developer machine containing backups of several critical keys, allowing them to authorize legitimate-looking transactions that drained about 141 million H tokens from the Ethereum bridge before additional tokens were minted on BNB Smart Chain. Humanity Protocol and Quantstamp said the attack bore characteristics associated with North Korea-linked threat actors.

The breach wiped out most of the H token’s value within hours, with on-chain analysts estimating losses of more than $32 million at the time and the token falling roughly 89% as the attacker minted and sold tokens across multiple chains. Kwok said monitoring systems quickly detected unusual token movements after the compromise, although determining the full extent of the incident required several days of forensic analysis across the project’s infrastructure.

Meta CEO Mark Zuckerberg said AI agent development at the firm is progressing more slowly than expected, even as technology and crypto firms continue pouring resources into the nascent technology.

In a company meeting on Thursday, Zuckerberg said the “trajectory of the agentic development over at least the last four months hasn’t really accelerated in the way that we expected,” according to Reuters, which reviewed a recording of the call.

The bet on agent adoption hasn’t “come to fruition yet,” Zuckerberg said, adding that executives made an aggressive push into agentic infrastructure in January in part because of fears they weren’t moving “fast enough.” 

Despite the slower progress, Zuckerberg said he expects the firm’s AI investments to start paying off within the next three to six months.

Zuckerberg’s comments offer a reality check for technology and crypto firms betting that autonomous agents will soon become major users of blockchain payments. Meta, along with several crypto firms, has bet big on agentic AI, with many pivoting their business models to cater to autonomous AI agents. 

In May, Meta cut roughly 10% of its workforce and reassigned about 7,000 employees to AI-focused teams — a restructuring Zuckerberg acknowledged was not as clean as it could have been, with executives miscalculating the timing. 

Meta expands AI agent feature on three platforms

Zuckerberg’s concerns come as Meta expanded its Meta Business Agent globally for businesses on Instagram, Messenger and WhatsApp on Thursday.

The Business Agent can respond to customer inquiries, make product recommendations and close sales without human intervention, Meta said.

Zuckerberg also revealed in March that he was building a personal AI agent designed to support his decision-making as CEO.

The crypto industry has been a keen adopter of the technology, with Coinbase CEO Brian Armstrong and Circle CEO Jeremy Allaire among the executives predicting that AI agents will become the dominant users of blockchain-based payments in the coming years.

Several notable integrations advancing AI agent-driven stablecoin spending have emerged in recent months, including one by Amazon Web Services in May, when it integrated Coinbase’s x402 payments protocol into Amazon Bedrock AgentCore, allowing agents to transact in the USDC (USDC) stablecoin.

Related: OKX launches AI marketplace for autonomous agent economy 

In April, crypto wallet startup Oobit launched a Visa-supported virtual card for AI agents to make online purchases in USDt (USDT) on behalf of businesses.

AI agent payments adoption lagging

Despite the integrations, data shows that AI-agent transaction activity on the blockchain remains relatively small, with Artemis data showing that only $2 million in trading volume has been facilitated through the AI agent-supported x402 protocol over the past 30 days.

Monthly change in x402 transaction volume over the past 12 months. Source: Artemis

Magazine: The end of anonymity? AI could unmask crypto’s hidden identities

A teenager suspected of involvement with the “Scattered Spider” hacking group has been extradited to the US over his alleged role in an $8 million crypto ransom.

The US Justice Department said on Wednesday that Peter Stokes, a 19-year-old dual US-Estonian national, was arrested in Finland in April on an Interpol Red Notice and extradited to the US last week to appear in a Chicago federal court on Tuesday.

A criminal complaint unsealed in court accused Stokes and others of breaching a luxury jewelry retailer’s computer system in May 2025 to steal data and demand a ransom payment of $8 million in crypto. The retailer managed to evict them from the network and did not pay the ransom, but suffered $2 million in disruption damages, according to the complaint.

Stokes is one of the few arrests that authorities have tied to Scattered Spider, which often uses crypto ransoms. Ransomware actors received more than $820 million in payments last year, an 8% decline from 2024, even as attacks rose by 50%.

An image the FBI took from Stokes’ Snapchat account shows him wearing a necklace that says “Hack the Planet,” a quote from the 1995 cult film “Hackers.” Source: US Department of Justice

Alleged hack started with phishing call

According to the complaint, the hack against the jewelry retailer started with several phishing calls to the company’s technology help desk, with Stokes and others allegedly pretending to be employees requesting a reset of login credentials.

Authorities alleged the hackers managed to compromise three employee accounts in as little as two hours, two of which belonged to company IT administrators, who had access to higher-privilege accounts that were also breached and used to access the company’s systems, 

After a few days, Stokes and others allegedly sent a ransom note from a compromised company email account to demand funds or they would publish credit card and payment information.

However, the complaint said the company repelled the intrusion and that the intruders later contacted the company separately to demand $8 million, which the company did not pay.

Stokes allegedly involved in “numerous intrusions”

The complaint accused Stokes, who uses the online nicknames “Bouquet” and “Jordan,” of being a “Scattered Spider member who has engaged in numerous intrusions, or assisted in them” on multiple unnamed companies.

Authorities claimed that a search of a storage device allegedly linked to Stokes showed it contained downloads from a virtual private server that Microsoft had identified as being used to carry out intrusions on companies.

The complaint alleged that it also “contained exfiltrated records from multiple victim-companies.”

Related: Taiko reopens bridge after $1.7M exploit, says users made whole

The complaint claimed that Stokes’ Snapchat account shows “substantial wealth for a person his age” and alleged that he used the account to boast “about his international travel and wealth, and sent media regarding apprehended Scattered Spider members.”

The Justice Department said that Scattered Spider, also known as “Octo Tempest,” “UNC3944,” and “0ktapus,” has been involved in over 100 network intrusions, resulting in more than $100 million in ransom payments and millions of dollars in damages.

Stokes was charged with six counts related to hacking, cyber extortion, fraud and conspiracy.

Magazine: Crypto scammers face death, Aussie CGT makes Asian hubs attractive: Asia Express

Roughly 10.83 million BTC are currently held at a loss, meaning their holders paid more than today’s price, against 9.22 million still in profit, according to Glassnode data. It is the first time loss-making supply has overtaken profitable supply since the current cycle began and reflects how deep the correction from bitcoin’s $109,000 January peak has cut.

Historically, these crossovers have landed near periods of peak financial stress and capitulation among newer buyers. They have also marked the point at which coins migrate from weaker hands to stronger ones, since only holders with high conviction tend to sit on losses rather than sell. Long-term holder accumulation and rising wallet-cohort balances across several size brackets have run alongside this latest deterioration in profitability.

Bitcoin traded at $61,361 on Thursday, up 0.7% on the day and 2.5% on the week, still roughly 44% below January’s all-time high, per CoinDesk data. Ether added 4.2% to $1,702, and Solana led the majors at 18.6% on the week to $80.44, with volume running above $3.6 billion.

Whether the supply crossover marks a bottom depends on what follows. In 2018-19 and 2022, similar readings preceded months of basing before a sustained recovery. The chart does not resolve on its own. ETF flows returning and macro pressure easing are what convert the accumulation signal into a price signal.

Japanese investment firm Metaplanet continued its corporate Bitcoin buildout in the second quarter, adding 2,823 BTC at an average price of about 12.71 million yen (roughly $78,850 at current exchange rates). The purchase pushed the company’s total holdings above 43,000 Bitcoin, while slightly lowering its average acquisition cost.

Separately, the story also highlights a contrasting trend among some smaller treasury-focused companies. South Korean firm K Wave Media exited its Bitcoin treasury strategy after selling its remaining BTC to address debt, while France-based Sequans Communications previously said it would monetize its remaining holdings over time.

Key takeaways

• Metaplanet bought 2,823 BTC in Q2, bringing its total to more than 43,000 BTC and reducing its average cost per coin.
• The latest tranche was acquired at an average price of about 12.71 million yen per BTC, lowering Metaplanet’s average acquisition cost to roughly $95,117.
• Metaplanet reported about $10.95 million in quarterly revenue linked to Bitcoin income-generation strategies involving options premiums and related yield methods.
• K Wave Media sold its last 88 BTC to repay debt, ending its Bitcoin treasury approach after earlier plans to expand holdings.
• Not every corporate treasury is expanding: Sequans Communications previously signaled that it would monetize its remaining Bitcoin holdings over time.

Metaplanet expands holdings and refines its cost base

According to a Thursday announcement from Metaplanet, the company acquired 2,823 Bitcoin during the second quarter at an average price of about 12.71 million yen per BTC. That figure matters because it was below Metaplanet’s prior average purchase price, enabling the firm to reduce its blended cost basis.

The acquisition lowered Metaplanet’s average acquisition cost to about $95,117 per BTC, down from approximately $96,258 previously. Metaplanet’s total Bitcoin holdings now stand at 43,000 BTC acquired for an aggregate value of about $4.1 billion, based on the figures in the company’s announcement.

Beyond accumulation, Metaplanet also disclosed quarterly performance tied to its Bitcoin income strategy. The company reported around $10.95 million in revenue from Bitcoin-related activities during the quarter. The approach, as described in the announcement, centers on earning premiums by selling cash-secured options and deploying other Bitcoin yield tactics.

For investors, the combination of spot purchases and options-based income generation is a key part of how treasury-style Bitcoin companies attempt to justify their equity valuations. When Bitcoin’s price is volatile, these revenue mechanisms can, in theory, partially offset drawdowns—though the net effect depends on execution, market conditions, and counterparty or strategy risks (none of which are detailed in this particular excerpt).

Shares move, but the broader performance picture remains uneven

Metaplanet’s equity performance reflected modest market optimism around the filing. The company’s shares closed Thursday up 3.5%, though the stock remains down about 48% year-to-date, according to the linked market page cited in the source text.

That underperformance also stands out against Bitcoin itself, which the source notes fell 31% over the same year-to-date period. The contrast underscores a persistent reality for corporate Bitcoin holders: even when a company keeps buying and building a large BTC position, investors may still reprice the stock due to factors like equity dilution risk, funding costs, valuation assumptions, or the market’s perception of how sustainable treasury income is.

The Metaplanet update comes during an ongoing push by several corporate buyers—yet the story is not purely one-directional, as other firms are trimming exposure.

Treasury strategies: K Wave Media exits after selling remaining BTC

While Metaplanet added Bitcoin, K Wave Media—an Nasdaq-listed company in South Korea—went in the opposite direction. The company sold its remaining 88 BTC to repay $6 million in debt, exiting its Bitcoin treasury strategy, according to a Tuesday filing with the U.S. Securities and Exchange Commission.

The SEC filing indicates a sharper reversal than what the company had previously communicated. Earlier coverage referenced in the source text describes K Wave Media’s July 2025 announcement that it secured $1 billion in capital capacity to drive its Bitcoin treasury strategy and aimed to expand holdings to 10,000 BTC. Exiting after holding only 88 BTC suggests the original plan ran into constraints—whether financial, operational, or strategic—though the excerpted material does not specify the reasons.

This kind of turnaround is important for readers because it highlights a mismatch risk that can exist in treasury models: plans premised on sustained capital access, favorable volatility, and consistent BTC purchase economics may not survive changing market conditions or debt obligations.

Other companies continue to monetize rather than accumulate

The source also points to Sequans Communications, a France-based semiconductor company that said in May it would monetize its remaining Bitcoin holdings over time. At the time of that announcement, Sequans reported holding 658 BTC, and its shares reportedly rose about 14.5% after the disclosure.

Taken together with K Wave Media’s decision to exit, the broader takeaway is that corporate Bitcoin strategies are diverging. Some companies are doubling down through additional spot buying and structured income strategies, while others are winding down exposure, using Bitcoin holdings to address liabilities, or planning to gradually convert BTC into cash.

Even within the same sector, these choices can produce very different investor outcomes depending on each firm’s balance sheet, debt profile, and how its equity market values the “BTC treasury” thesis.

Looking ahead, investors should watch whether Metaplanet can sustain its Bitcoin income-generation revenue while continuing to manage its cost basis, and whether other treasury-focused firms follow K Wave Media and Sequans toward monetization or debt reduction. The key uncertainty across all these cases remains whether corporate models that rely on both holding BTC and generating yield can hold up as market conditions and financing access evolve.

The HCMC did not immediately respond to a CoinDesk request for comment regarding Binance’s MiCA licensing process.

“As the person who led the license application, there’s nothing that I have been made aware of that there was any issue with the application,” Lynch added. “In fact, I was told the complete opposite.”

Lynch also argued that Europe’s crypto market loses more than just its largest exchange if Binance remains outside the MiCA framework. She said Binance provides liquidity and market infrastructure that benefit the wider crypto ecosystem, adding that regulation should strengthen the industry rather than exclude companies that have invested heavily to meet its standards.

Lynch declined to speculate on reports that political intervention played a role in the delays. Instead, she said the focus is now on helping users through the transition period while preparing a new licensing strategy.

“We’re very committed to being in Europe and very committed to being regulated,” she said.

Despite Binance’s experience, Lynch described MiCA as a positive step for the industry. She said the regulation has helped bring crypto into the financial services system by providing firms with clear rules and consumers with greater protection.

“I fundamentally believe the crypto industry is maturing. Regulation brings maturity,” she said. “The industry is here to stay, and it’s part of the financial services ecosystem.”

TLDR:

• Franklin Templeton exchanged a tokenized Treasury security for tokenized cash using on-chain settlement.
• The transaction paired a tokenized U.S. Treasury with USDCx and settled through Canton Network infrastructure.
• Tradeweb executed and priced the trade while several financial firms participated in the transaction.
• The deal occurred after market hours and was later reported to TRACE, according to Christopher Perkins.

Franklin Templeton has completed a tokenized U.S. Treasury transaction using stablecoins and on-chain settlement infrastructure. The trade involved the exchange of a tokenized Treasury security for tokenized cash on the Canton Network.

Tradeweb facilitated execution and price discovery while several financial firms supported the transaction. The deal adds to institutional efforts to move real-world assets onto blockchain-based financial rails.

Tokenized U.S. Treasury Trade Executes on Canton Network

Tradeweb announced the completion of the real-time transaction on July 1. The trade paired an on-chain U.S. Treasury with tokenized cash known as USDCx.

According to the announcement, Franklin Templeton transferred a tokenized Treasury security to Virtu Financial. In return, Virtu delivered USDCx through synchronized settlement on the Canton Network.

Tradeweb supplied the execution venue and pricing services for the transaction. The Canton Network coordinated the simultaneous movement of both assets on-chain.

Participants included Blockdaemon, Digital Asset, Franklin Templeton, Societe Generale, Tradeweb, and Virtu Financial. The transaction was also reported to TRACE after execution.

Christopher Perkins, president of CoinFund and former Coinbase executive, said on X that the trade took place after normal market hours. He noted that the transaction settled nearly instantly and represented another step toward continuous on-chain markets.

Tokenized Real-World Assets Gain Institutional Momentum

Tradeweb said the transaction demonstrates how tokenized U.S. Treasuries and tokenized cash can settle in real time. The company noted that traditional timing and settlement limitations did not apply to the process.

The transaction also arrives as the Canton Network prepares for the launch of DTCC’s Tokenization Services later this year. According to the announcement, the initiative aims to support broader access to high-quality liquid assets beyond traditional market hours.

Digital Asset said the transaction marked another milestone in developing always-on and interoperable capital markets infrastructure. The company added that continuous market making can increase asset utility and improve market accessibility.

Franklin Templeton described each tokenized transaction as another step toward a round-the-clock liquidity layer. The asset manager stated that on-chain capabilities can allow high-quality assets to move without the restrictions of standard market schedules.

Virtu Financial said the trade expands its market-making capabilities into tokenized U.S. Treasuries. The company added that blockchain-based settlement can support liquidity provision without conventional settlement constraints.

The Canton Network said active participation from firms including Franklin Templeton, Tradeweb, and Virtu Financial contributes to a unified framework for moving real-world assets across digital financial systems.

Strategy’s long streak as one of Bitcoin’s most consistent institutional buyers may be ending, according to Bitwise chief investment officer Matt Hougan. Speaking Thursday, Hougan suggested the company’s dominance as a “one-way” source of demand is likely to shrink in the next market cycle, after volatility around Strategy’s principal perpetual preferred stock product, Stretch (STRC).

The reassessment comes after STRC broke sharply from its $100 par value to below $75 late last month, a move that undermined investor confidence in the sustainability of Strategy’s dividend-style model. The timing also overlapped with broader market stress, when Bitcoin fell to a 21-month low of $58,190 on June 25.

Key takeaways

• Bitwise CIO Matt Hougan said Strategy’s era as Bitcoin’s dominant buyer may be over, with other institutional allocators expected to play a larger role next cycle.
• STRC’s move away from $100 par value below $75 fueled concerns about whether Strategy’s yield structure can hold up through “end-of-cycle” dynamics.
• Despite the STRC shock, Hougan argued Strategy is not facing near-term liquidity risk based on liquid asset coverage.
• Strive CEO Matt Cole pushed back, calling the STRC episode overblown and noting Strategy’s Bitcoin holdings are about 4% of total supply.

Strategy’s buyer dominance questioned after STRC turmoil

For years, Strategy has been widely viewed as a steady, high-conviction buyer of Bitcoin—helping provide consistent demand even when broader sentiment weakened. Hougan framed Thursday’s comments around a shift in what investors should expect from that demand profile.

“For years, Strategy has been the most dominant Bitcoin buyer in the world and a one-way source of Bitcoin demand. Those days are likely over,” Hougan said in a CIO memo, adding that he expects the company to be “less important” than it was in the previous cycle. In his view, banks, asset managers, pensions, endowments, and sovereign wealth funds may replace Strategy as Bitcoin’s primary demand engine as the next upcycle develops.

Hougan’s concern centers on how STRC behaved during a period when markets were already under pressure. The STRC incident raised fears that the structure underpinning dividend payments could be strained when conditions tighten—particularly in late-cycle environments where risk appetite falls and funding costs rise.

Why Hougan sees STRC as “end-of-cycle dynamics”

Hougan characterized the STRC drop as a pattern he associates with late-cycle stress. He compared the situation to a prior example in 2021: the collapse of Grayscale’s GBTC premium.

His argument is essentially about fit. According to Hougan, “money searching for high yields and low volatility was used to buy Bitcoin, which offers neither.” In that framing, the market eventually needs to “clear out” capital that was attracted by yield characteristics that Bitcoin itself does not reliably provide, before a more durable bottom can form.

This perspective matters for traders and longer-term investors because it reframes Strategy’s recent volatility away from a single-company solvency story and toward a broader liquidity-and-demand composition story—one where the source of marginal demand changes as the cycle matures.

Strategy responds: funding dividends and increasing reserves

In the aftermath of the STRC disruption, Strategy said it would sell Bitcoin when necessary to fund dividends, according to coverage earlier published by Cointelegraph. The company also expanded its US dollar reserve to $2.55 billion, easing some immediate concerns about operational coverage.

Even with those steps, Hougan said Strategy’s role as an aggressive buyer has weakened. The implication for market participants is that reserve moves and occasional Bitcoin sales can stabilize the dividend narrative in the short term, but may also reduce the consistency of net buying during turbulent periods.

Hougan nonetheless said he still expects Strategy to be a “net buyer” in the next bull run—suggesting the firm’s long-term posture may persist, even if its influence on price dynamics is likely to be less dominant than in the last cycle.

Debate over materiality and liquidity risk

While STRC became the focal point, Strategy leadership pushed back on how much attention the incident deserves. Strive CEO Matt Cole argued that the episode has been overemphasized by media and that Bitcoin’s selloff may have been driven more by the broader market than by any single factor.

Speaking with NovaDius Wealth Management president Nate Geraci, Cole noted that Strategy’s 847,363 Bitcoin represents about 4% of total supply. He also referenced US Securities and Exchange Commission standards for materiality, stating that a 4% stake would not be considered material under SEC thresholds, which he described as starting at 5%.

“If one person owned 4%, you don’t even have to report that publicly to the SEC because the SEC deems 4% to be immaterial. They start to view a position to be material at 5%.”

Hougan, meanwhile, addressed liquidity in a more quantitative way. He said Strategy has $52 billion worth of liquid assets marked against $7 billion of debt. In his assessment, Bitcoin would need to fall another 70%—to roughly $18,500—for Strategy to face risk. He also added that if the company began selling Bitcoin immediately, it could cover dividends from STRC and other perpetual preferred stock offerings for the next 28 years.

Taken together, the two positions highlight a tension that investors should watch: one view suggests the STRC mechanism is a late-cycle stress test that affects demand composition and price, while the other emphasizes reserve coverage and argues that the company’s balance sheet prevents an immediate liquidity threat.

For now, the key question is not whether Strategy can operate through the current strain, but whether the market’s next wave of Bitcoin buying will be driven by the same yield-seeking, vehicle-based demand—or by a broader set of long-term allocators that Hougan expects to take a bigger share.

As conditions evolve, investors should monitor whether STRC stabilizes relative to par and whether Strategy’s net buying pace remains consistent enough to reassert influence—while also tracking if incremental demand truly shifts from Strategy-style products to the wider institutional categories Hougan cited.

Riot Platforms transferred another 500 BTC to NYDIG Custody, according to Arkham data cited by onchain trackers. 

The transfer was worth about $30.72 million at the time of the report and was shared through an Onchain Lens post.

The move may signal that Riot is preparing to sell part of its Bitcoin holdings. Transfers to custody or execution partners do not always confirm a sale, but similar Riot transfers this year have often come before reported selling activity.