Washington has spent a year arguing about which agency should regulate a $2.2 trillion market. Nobody checked whether that agency has anyone in the building. It has one person, four empty chairs, and a plan involving artificial intelligence.

For a year, the entire American crypto policy debate has been a jurisdictional argument. Should the SEC or the CFTC supervise digital asset markets? The CLARITY Act answers CFTC, and the industry has spent enormous energy and money trying to get that answer written into law. Somewhere in that year, almost nobody stopped to ask a more basic question about the agency on the receiving end of the handoff. The Commodity Futures Trading Commission is designed to hold five commissioners. It currently has one. Four seats sit empty, including both minority-party positions. The body that Congress is preparing to make the primary regulator of a $2.2 trillion market is, at this moment, a single person, a shrinking staff, and a plan to have software pick up the difference.

The arithmetic

Start with the headcount, because it is the least arguable part.

The CFTC ran fiscal 2025 with roughly 556 employees. The SEC runs about 4,200. That gap existed before crypto and made sense when the CFTC supervised agricultural futures and interest rate swaps, which are large markets with a small number of sophisticated participants. It makes considerably less sense as a description of an agency preparing to police spot markets for tokens held by tens of millions of retail buyers.

Since January 2025, under the federal workforce reduction drive, the agency has lost somewhere between 21% and 25% of its people. The enforcement division, the part that actually pursues fraud, sits at roughly 108 positions following a budget request for three new hires, which leaves it about 23% below the 140 enforcement employees it had on record in 2025. So the agency shrank the function most relevant to the mandate it is about to receive.

Then leadership. The commission is statutorily five seats. Selig, confirmed in December 2025, is the only sitting commissioner. This is not new: his predecessor, acting chair Caroline Pham, was also the agency’s sole commissioner during her tenure, which means the CFTC has functioned as a one-person body across two administrations’ worth of leadership. Four vacancies, including both seats reserved for the minority party, on a commission designed for bipartisan balance.

Selig himself is not an accidental appointment. He is a former CFTC official who most recently served as chief counsel to the SEC’s Crypto Task Force, which makes him arguably the best-credentialed person in Washington for the job he holds. That is precisely why the vacancy math is worth taking seriously instead of reading as partisan noise. The problem is not the person in the chair. It is the four chairs with nobody in them.

What keeps getting added to the plate

Now the workload, which has moved in the opposite direction from the headcount.

Crypto market structure. CLARITY would give the CFTC primary oversight of spot trading in digital commodities, meaning Bitcoin, Ether, XRP, Solana, and the rest of the assets named in the March joint taxonomy. That is rulebooks, registration, examinations, supervision, and custody standards for an entirely new market.

Prediction markets. The agency is asserting exclusive federal jurisdiction over a sector that has grown from millions of dollars a year to multiple billions, and it is litigating that claim: the CFTC has sued Illinois, Arizona, and Connecticut over state efforts to regulate sports prediction markets. Selig has confirmed numerous ongoing investigations in the space, with lawmakers pressing him about trades on Polymarket and Kalshi in which small numbers of anonymous accounts appear to have profited on bets tied to US military actions and government announcements, a pattern suggesting possible access to non-public information.

Perpetual futures. The agency is writing rules for a product that generated tens of trillions in annual volume offshore and is now arriving onshore, while simultaneously being sued by the CME over what a perp legally is.

DeFi guidance and Project Crypto, the joint initiative with the SEC that produced the March taxonomy.

At an April House Agriculture Committee oversight hearing, Chairman Glenn Thompson put the contradiction to Selig directly, observing that Congress is putting a lot on your plate with digital assets while also pushing the agency down the prediction markets path, and asked him to request more staff if operations required it. Selig agreed he would.

Thompson and Representative Craig then said they would write to the White House encouraging prompt appointment of commissioners from both parties. That letter is the tell: the committee overseeing the agency is publicly lobbying the executive to staff it.

Selig’s public answer to the resource question is technology. He has said artificial intelligence and automation can compensate for the personnel cuts, and that the agency is pushing to use it for reviewing registration applications and assisting market surveillance. He has also warned that enforcement remains a top priority and that participants should be on notice.

Read that plainly. The agency about to inherit crypto plans to review its registration applications with software because it does not have the people.

The bull case: one voice moves faster

Here is the part that inverts the obvious reading, and it comes from the reporting rather than from the agency’s spin.

A one-person commission is not slower. It is faster. Bloomberg Law’s reporting on the CFTC’s recent output describes an agency accelerating its rulemaking on prediction markets and crypto precisely because there is nobody to argue with. No minority commissioners drafting dissents. No negotiating a majority. No scheduling votes around four other calendars. A chairman who wants a proposal out can put it out.

That speed is visible. The agency has moved on prediction market rulemaking with unusual pace, in part as a deliberate strategy to preempt state claims by putting a federal framework in place quickly. It ran a crypto sprint, updated regulatory language for blockchain-based markets, formally approved spot crypto trading, and co-authored the March taxonomy with the SEC, which Selig has called the most important action taken to date, saying simply that now there is clarity. For an agency supposedly paralyzed by vacancies, the output is substantial.

There is a resource argument on the same side. The Trump administration is seeking more money and a larger headcount for the CFTC, so the staffing hole is at least acknowledged and being addressed through the budget process. And the automation case is not absurd on its face: reviewing registration applications is exactly the kind of structured, document-heavy work where software genuinely helps, and an agency that automates intake can point its scarce attorneys at enforcement instead of paperwork.

The strongest version of the bull case is simply this: the CFTC has, over the past year, produced more usable crypto policy than Congress has, with one commissioner and a quarter fewer staff. Whatever the org chart says, the output is real.

The bear case: fast is not durable

The rebuttal is that speed achieved by removing dissent is not a feature of a regulatory body. It is the absence of one.

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Multi-member commissions exist because financial regulation benefits from adversarial internal review. A dissenting commissioner forces the majority to answer the strongest objection before a rule publishes instead of after, in court. Remove the dissent and you do not get better rules faster; you get rules that have never been stress-tested by anyone with the standing to stress-test them. Former CFTC leaders have publicly doubted the agency can juggle crypto and prediction markets simultaneously, and Selig’s Democratic predecessor Rostin Behnam argued routinely that the agency lacked the people to police crypto and prediction markets as they spread.

The durability problem is worse, and it connects directly to the wider argument the industry keeps having. A rule written by a single commissioner is a rule a future five-member commission can revisit with ease and with a ready-made rationale: that it was adopted without the deliberative process the statute contemplates. The industry wants permanence. It is currently getting output from the least permanent possible configuration of a regulator. Selig himself acknowledged the point in a different context, noting that the joint taxonomy does not yet carry the full force of permanent policy.

Then the examination gap, which is where the theory meets the market. Writing a rulebook is the cheap part. Supervising a market means examiners: people who visit registrants, review books, test controls, and catch problems before they become enforcement matters. An enforcement division 23% below its 2025 level is not a division that can absorb spot supervision of every crypto exchange, custodian, and broker seeking dual registration.

Crypto-native exchanges, traditional broker-dealers, asset managers building tokenization platforms, custodians, and futures commission merchants would all queue for the same application reviews at an agency of roughly 550 people. Artificial intelligence does not conduct an examination.

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And the prediction market investigations sharpen the point. Selig has confirmed the agency is investigating well-timed trades that lawmakers suspect involved non-public information, in a market that has grown into the billions. Those are exactly the labor-intensive cases that a shrunken enforcement division struggles to bring. Asserting exclusive jurisdiction over a sector is a claim about authority. Policing it is a claim about capacity, and the two have diverged.

There is a historical pattern worth naming here, because the industry has watched it before and drew the wrong lesson. Regulators handed a new market without the resources to supervise it do not simply fail quietly. They fail loudly and late, after something breaks, and the political response is invariably an overcorrection that lands harder than the original rules would have. The agency does not have the examiners to catch problems early, so problems surface as scandals instead of as findings, and scandals produce legislation written in anger. An industry that wants light-touch supervision should be the loudest voice demanding the supervisor be adequately staffed, because the alternative to competent oversight is not an absence of oversight. It is delayed oversight, imposed after a failure, by people who are no longer in a listening mood.

That is the argument the crypto lobby has not made and probably will not, because it sounds like asking for a bigger regulator. It is worth making anyway. The industry spent a year insisting that the CFTC is the right home for digital assets, largely on the theory that the agency is smaller, more pragmatic, and less litigious than the SEC. Every one of those qualities is downstream of the same fact: the CFTC is small. The thing that makes it attractive as a regulator is the thing that makes it questionable as a supervisor of a market this size, and nobody has reconciled the two.

NEW: CFTC Chair Michael Selig says prediction markets are the next crypto

He compared them to crypto’s shift from narrow uses to an explosion of blockchain products and stressed the need to maintain CFTC jurisdiction pic.twitter.com/3yoKPyihHv

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— crypto.news (@cryptodotnews) July 13, 2026

The fight over the empty chairs

The vacancies are not an accident of paperwork. They are a live political dispute with documents on both sides, and it broke into the open this month.

On June 10, twelve Senate Democrats, led by Chris Van Hollen and Raphael Warnock, wrote to the White House complaining about staffing at federal financial regulators including the SEC and CFTC. Their argument was procedural: the administration had broken with the customary practice of consulting Senate Democrats on minority-party nominees to independent agencies, and vacancies weaken agency independence.

On July 9, the White House fired back in a letter to Majority Leader John Thune and Minority Leader Chuck Schumer, signed by Director of Presidential Personnel Dan Scavino and Director of Legislative Affairs James Braid, saying it wanted to set the record straight. The administration said it had already asked Senate Democrats to recommend candidates for the vacant Democratic seats at both agencies and had not received names in response. It argued that Senate Democrats have blocked essentially every civilian nominee, and pointed out that Trump has nominated Democrats to other independent bodies including the National Labor Relations Board and the International Trade Commission. It also invoked the Supreme Court’s decision in Trump v. Slaughter, which expanded presidential removal powers, a citation that does not obviously help the bipartisanship argument.

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The history is messier than either letter admits. The administration withdrew Brian Quintenz’s nomination for the CFTC chairmanship in September 2025 before nominating Selig in October, a sequence documented in the White House’s own list of nominations and withdrawals. So the seat that is filled took two attempts, and the four that are empty have generated a blame exchange instead of names.

The SEC is in comparable shape and receives a fraction of the attention. It has two vacant Democratic seats against three Republican commissioners, and Hester Peirce, one of the three, is expected to leave by November. Which produces the fact that ought to be the headline of the entire CLARITY debate: both of the agencies that would divide American crypto oversight are short-staffed at the commissioner level, and one of them is a single person.

The provision nobody is reading

There is a clause in the bill that turns all of this from a governance complaint into a market-structure problem, and it is Section 106.

CLARITY does not simply hand the CFTC authority and walk away. It contemplates a window in which the agency must finalize rulebooks, hire examiners, build supervision teams, and stand up a digital asset custody framework. If the CFTC cannot do those things inside that window, the industry operates under provisional status.

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Sit with what that means. The bill the industry has spent a year fighting for, on the theory that regulatory certainty is the prize, contains a fallback in which firms operate provisionally because the regulator could not staff up in time. Provisional status is not certainty. It is uncertainty with a statutory basis, which may be marginally better than the status quo and is nothing like what the lobbying promised.

That is the risk almost nobody in the vote-counting coverage has priced. The failure mode of CLARITY is not only that it dies in the Senate. It is that it passes, hands a $2.2 trillion market to a one-person commission with 550 employees and a quarter of its enforcement staff gone, and the handoff does not work on schedule. The bill can pass and still not deliver certainty for years.

What to watch

Three things.

Whether any commissioner gets nominated before the recess. The House Agriculture leadership is already writing to the White House about it, and both parties say the agencies should have full benches before major crypto rules advance. If CLARITY reaches a floor vote while the CFTC still has one commissioner, that fact becomes an argument for opponents and a genuine operational problem for supporters.

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Whether the automation claim survives contact. The CFTC says artificial intelligence will review registration applications. The first wave of applications under any new framework will test that immediately, and the results will be visible in processing times and in whatever the first enforcement failure turns out to be.

Section 106 and the transition window. If the bill moves, read that section before reading the vote count. It determines whether passage produces rules or produces a provisional regime, and it is where the staffing arithmetic and the legislative arithmetic finally meet.

The crypto industry asked Washington to pick a regulator. Washington is close to picking one. What nobody checked, through a year of lobbying, hearings, and vote math, is whether the regulator has anyone left to answer the phone.

Disclaimer: This article is for information and educational purposes only and does not constitute financial, investment, or legal advice. It describes pending legislation, agency staffing, and political disputes, all of which are developing and can change quickly. Nothing here is a recommendation to buy or sell any asset. Always do your own research. Information is accurate as of July 17, 2026.

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Frequently Asked Questions

How many commissioners does the CFTC have?

One. Chairman Michael Selig, confirmed in December 2025, is the sole sitting commissioner of a body statutorily designed to hold five. Four seats are vacant, including both positions reserved for the minority party. His predecessor, acting chair Caroline Pham, was also the agency’s only commissioner, so the CFTC has operated as a one-person commission across two leadership periods.

Why does that matter for crypto?

Because the CLARITY Act would give the CFTC primary oversight of spot trading in digital commodities, meaning the assets named in the March 2026 joint taxonomy including Bitcoin, Ether, XRP, and Solana. Supporters of the bill warn that a short-staffed agency could struggle to supervise a market worth roughly $2.2 trillion, and both parties have argued the agencies should have full leadership benches before major new crypto rules advance.

How big is the CFTC compared to the SEC?

Roughly 556 employees in fiscal 2025 against the SEC’s approximately 4,200. The CFTC has since lost between 21% and 25% of its workforce under the federal workforce reduction drive. Its enforcement division sits at about 108 positions after a request for three new hires, roughly 23% below the 140 enforcement staff it had on record in 2025.

What is the CFTC’s answer to the staffing problem?

Automation. Chairman Selig has said artificial intelligence and automation can compensate for personnel cuts, and that the agency intends to use the technology to review registration applications and assist with market surveillance. He has also said enforcement remains a top priority. The Trump administration is separately seeking more funding and a larger headcount for the agency.

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Is a one-commissioner agency slower?

Apparently not. Reporting on the agency’s recent output indicates the opposite: rulemaking has accelerated, because a single commissioner faces no dissents to answer, no majority to negotiate, and no other calendars to accommodate. The agency has moved quickly on prediction market rules, approved spot crypto trading, and co-authored the March taxonomy. The open question is whether speed achieved by removing internal review produces durable rules.

What else is on the CFTC’s plate?

A great deal. It is asserting exclusive federal jurisdiction over prediction markets, a claim it is litigating against Illinois, Arizona, and Connecticut. It is writing rules for perpetual futures while being sued by the CME over how a perp is legally classified. It runs Project Crypto jointly with the SEC. And it is drafting DeFi guidance. Each mandate draws on the same pool of attorneys and economists.

What is the dispute over the vacant seats?

Twelve Senate Democrats led by Van Hollen and Warnock wrote on June 10 alleging the administration broke the customary process for consulting on minority-party nominees. The White House responded July 9 in a letter to Thune and Schumer, signed by Scavino and Braid, saying it had asked for Democratic recommendations and received no names, that Democrats blocked essentially every civilian nominee, and that Trump has nominated Democrats to other independent bodies.

What is Section 106 of the CLARITY Act?

It concerns the transition. The bill contemplates a window during which the CFTC must finalize rulebooks, hire examiners, build supervision teams, and stand up a digital asset custody framework. If the agency cannot complete that inside the window, the industry operates under provisional status. That makes the staffing question a market-structure question: the bill can pass and still fail to deliver the certainty it was sold on.

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Pi Network price has surged more than 13% to an intraday high of $0.083 after the Core Team confirmed a Protocol v25 upgrade for July 22, lifting retail sentiment around the battered token.

According to data from crypto.news, Pi Network (PI) price traded near $0.082 at press time after rebounding from its July 14 record low around $0.071. The advance stood out as Ethereum, Solana, and other high-beta cryptocurrencies fell alongside a global technology-stock rout.

Protocol v25 and leveraged demand have fueled the rebound

Pi Network’s Core Team confirmed that Protocol v25 will improve network stability and add tools for more efficient, privacy-preserving smart contracts. The team also introduced a redesigned Mining App menu intended to simplify access to ecosystem features and applications. Pi Network’s announcement gave traders a dated catalyst after PI lost about 27% over the previous week.

The Pi mining app side menu and app profile page have been redesigned!

As the first step of a broader mining app design refresh, this update makes important Pioneer info and ecosystem features easier to find, understand, and navigate. Tap the hamburger (☰) icon in the top left… pic.twitter.com/NVVo1Y5TnL

— Pi Network (@PiCoreTeam) July 16, 2026

Derivatives traders quickly increased their exposure. PI futures open interest rose to $10.73 million from $10.44 million a day earlier. Rising leverage, combined with thin order books, likely helped accelerate the move as bearish positions faced pressure above $0.080.

Meanwhile, Pi Network’s retail-heavy market structure helped the token move independently of large-cap altcoins. Global technology shares fell on July 17 as investors reduced leveraged exposure to semiconductor and AI stocks, while renewed Middle East tensions pushed oil prices higher.

U.S. initial jobless claims also dropped to 208,000 from 216,000, another sign of resilience in the labor market. Firm economic data can reduce the case for Federal Reserve rate cuts, a development that usually hurts speculative assets. PI’s network-specific catalyst outweighed that pressure during Friday’s session.

On the lower-time-frame chart, PI has formed three troughs around $0.073–$0.075, creating a possible triple bottom. The pattern requires a decisive close above its neckline near $0.082–$0.083. A confirmed breakout could open a move toward $0.086, where the chart shows the next short-term target.

According to trader Crypto With Gopal, buyers have repeatedly defended the same support zone.

“Support has held multiple times—now all eyes are on the breakout. Market sentiment is turning increasingly bullish.”

$PI is printing a triple bottom formation 👀 Three strong reactions from the same support zone suggest buyers are defending the level aggressively. Momentum is improving as price starts pushing back toward key resistance. 📈

A breakout above the neckline could confirm bulls… pic.twitter.com/Qmd2mjWsyC

— Crypto With Gopal (@cryptowithgopal) July 17, 2026

The daily chart presents a tougher test. PI remains inside a descending channel that has controlled price action since late April, while the Supertrend stays bearish at $0.101. A rebound toward that level would still leave the token beneath the channel’s upper boundary, now located around $0.108.

Weak money flow and token unlocks threaten the recovery

Chaikin Money Flow remains negative at approximately -0.15, which shows that capital outflows still exceed inflows despite Friday’s bounce. PI must push the indicator above zero and reclaim $0.101 before the daily chart supports a durable trend reversal.

Supply also remains a structural risk. PiScan data showed roughly 127.5 million PI scheduled to unlock over a 30-day period, equal to an average of about 4.25 million tokens per day. Continued releases could limit gains unless network activity creates enough demand to absorb the new supply.

A rejection from $0.083 would weaken the triple-bottom setup and return attention to $0.074. A daily close below that support would invalidate the recovery thesis and expose the record-low region near $0.071, with the descending channel allowing further losses toward $0.065.

“The real prize is the yen side of onchain settlement, one of the most strategic positions in Asian finance over the coming decade, and that is exactly what SBI is building toward,” he added.

One technical limitation remains. JPYSC does not yet support withdrawals to external wallets.

“Regarding JPYSC, its use is currently limited to accounts within SBI VC Trade, and it does not yet support withdrawals to external wallets or remittances and settlements via public blockchains,” the spokesperson said.

For now, that limits JPYSC’s use outside SBI’s own platform. Investors cannot yet move the stablecoin to external wallets or use it to settle transactions across public blockchains.

Sota Watanabe, CEO of Startale Group, which works with SBI Holdings on JPYSC, said the company’s continued investment in digital assets reflects what he sees as growing institutional confidence in blockchain infrastructure.

“SBI Holdings’ continued commitment to digital assets likely signals confidence in the future architecture of global finance,” Watanabe told CoinDesk.

He said blockchain is increasingly being viewed as financial infrastructure rather than an emerging technology, adding that Japan is well-positioned to lead the sector due to its regulatory framework and financial institutions.

SBI expansion

SBI agreed to buy Tokyo-based cryptocurrency exchange Bitbank for around $289 million in June. The acquisition is expected to close in October, subject to regulatory approval. SBI previously acquired crypto exchange Bitpoint in 2022. The firm also led a $76 million Series C funding round for institutional exchange EDX Markets and a $25 million Series C round for crypto risk manager Gauntlet, the spokesperson said.

Solana price has fallen nearly 4% to about $74 after a rejection near $77, as a global technology sell-off and leveraged long liquidations have pushed traders toward caution.

According to data from crypto.news, Solana (SOL) price extended its decline on July 17 after failing to hold above the $76.50–$77 resistance area. Selling accelerated as semiconductor shares led losses across global markets, with Nasdaq 100 futures down 1.8%, Japan’s Nikkei 225 off 4%, and Taiwan’s benchmark plunging more than 6%.

The drop can partly be attributed to the rout due to doubts over stretched artificial intelligence valuations and leveraged retail positions.

Strong U.S. data added pressure on speculative assets. Initial unemployment claims fell to 208,000 from 216,000, while June retail sales rose 0.2%. The 10-year Treasury yield climbed toward 4.60%, and the dollar strengthened, raising the cost of holding high-beta assets such as Solana.

Institutional demand has provided only limited relief. U.S. spot Solana exchange-traded funds attracted $8.36 million on July 6, their strongest daily intake in almost two months, per data from SoSoValue. However, the inflow was not enough to prevent SOL from retreating from its early-July high near $83.

Solana price can rebound if bulls reclaim $76.50

On the 4-hour chart, SOL trades near $74.87 and has reached the lower Bollinger Band at $74.33. The middle band at $76.51 now serves as immediate resistance, while the upper band sits at $78.69. A 4-hour close above the midpoint would give buyers another chance to test the $78–$80 region.

Momentum remains weak but is approaching levels where relief rallies can develop. The 4-hour relative strength index has dropped to 36.58, below its signal average of 45.48 but still above the oversold threshold of 30. Price has also formed a sequence of lower highs since its July 4 peak near $83.

According to crypto analyst SatoshiOwl, SOL has reached a support area after breaking beneath an ascending trendline.

“Hold here and we could see a relief bounce back toward $78–$80. Lose it, and a deeper flush becomes much more likely.”

Ali Charts offered a longer-term counterpoint, noting that the TD Sequential indicator has produced a buy setup on Solana’s monthly chart. The analyst described it as a potential early warning of a macro trend change, although the monthly setup requires confirmation from shorter time frames.

The daily chart remains constructive above the Supertrend support at $69.62. Chaikin Money Flow stands at 0.03, which shows that capital flow is still marginally positive despite the latest sell-off. SOL must first recover the former horizontal support at $76.64 before the daily structure can improve.

CoinGlass’ three-day liquidation heatmap places the nearest large pools of leveraged positions above the market. Dense clusters sit near $76.50–$76.70, $78, and $78.70, making those levels possible price magnets if SOL rebounds. A move through $76.70 could liquidate short positions and accelerate a recovery toward $78.

A break below $74 would expose the $69.60 support zone

Downside risk will rise if SOL closes decisively below the $74–$74.30 area. The heatmap shows less concentrated liquidity immediately beneath the current price, leaving room for a quicker decline toward $72 before the daily Supertrend level near $69.62 comes into play.

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A loss of $69.62 would invalidate the remaining bullish daily setup and expose the June recovery base between $64 and $66. Macroeconomic pressure could deepen that move if Treasury yields continue higher, technology shares extend their decline, or renewed U.S.-Iran tensions lift oil prices and reduce demand for risk assets.

For now, SOL remains caught between weak four-hour momentum and positive daily capital flow. Bulls need $76.50 back to target the liquidity stacked near $78–$80, while a failure to protect $74 would place the $69.60 trend support at risk.

Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.

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More than $1 out of every $10 of the world’s tokenized US Treasuries is issued by a company incorporated in the British Virgin Islands.

That places the small Caribbean territory behind only the United States as a key jurisdiction for the rapidly growing asset class, according to BVI Finance.

BVI Finance’s Destination Digital report in June found that BVI entities accounted for approximately $1.5 billion of the $14.98 billion global market for tokenized US Treasuries as of June 1.

A growing list of digital asset firms now call the British Virgin Islands home, including Kraken’s parent company, Payward, Bitstamp (recently acquired by Robinhood), 1inch and Bitfinex.

The territory boasts a stablecoin market cap of about $1.2 billion held in BVI-linked addresses and has roughly 28,000 stablecoin asset holders.

More than 25 virtual asset service providers (VASPs) have been approved under the BVI’s VASP regime, and, according to Bernstein Research, the Islands host 305 tokenized securities — the highest count for any single jurisdiction in the RWA.xyz dataset.

US tokenized securities distributed value by jurisdiction. Source: Destination Digital

The statistics suggest the Virgin Islands has become one of the world’s top crypto hotspots, but the reality is a little more nuanced.

Tokenized assets are designed to be borderless, and crypto projects often have the choice of which offshore jurisdiction to incorporate in.

In most cases, digital asset companies aren’t physically relocating to the Virgin Islands; they’re simply using the territory to incorporate legal entities, such as token issuers, treasury vehicles, holding companies or special purpose vehicles (SPVs).

Crypto companies aren’t just choosing BVI for tax reasons

Andrew Jowett, a partner at Appleby (BVI) Ltd who advises digital asset businesses on corporate structuring, told Cointelegraph that clients researching the BVI typically compare several jurisdictions, such as the Cayman Islands, United Arab Emirates, Singapore and Switzerland.

Despite long-held assumptions about offshore Caribbean tax havens, tax neutrality is no longer the primary driver.

Related: Dubai crypto market hits 50 licensed firms after new VARA approval

“The overriding factor for choosing the BVI has been digital asset regulation and not tax,” Jowett said. The British overseas territory does have attractive tax policies, and imposes no corporate income tax or capital gains tax on BVI companies.

But all the leading crypto hubs now have favorable crypto tax policies, meaning it’s no longer the deciding factor.

The Cayman Islands imposes no corporate income tax or capital gains tax, and the UAE has zero personal income tax or federal corporate tax on qualifying free zone entities.

“Tax neutrality is table stakes,” said Saeed Al-Marri, chief executive of digital asset infrastructure firm Ethra, which is incorporated in the BVI. He added that the BVI provides legal certainty and clarity, factors he said will determine which jurisdictions survive institutional adoption.

LTP is an institutional digital asset infrastructure provider that operates regulated entities in the BVI, Hong Kong, Australia and the UAE. Its founder and chief executive, Jack Yang, told Cointelegraph that while favorable taxation is relevant for cross-border structures, it is secondary to legal and regulatory certainty as tokenization moves further into institutional finance.

“A tax-neutral structure that cannot pass review by banks, custodians, auditors, investment committees, or regulators has limited practical value,” he said.

Number of tokenized securities by jurisdiction. Source: Destination Digital

Orest Gavryliak, chief legal officer at decentralized exchange aggregator 1inch, which is incorporated in the BVI, said that more and more decentralized finance (DeFi) protocols are choosing jurisdictions that provide predictable rules, rather than simply the lowest tax burden.

“Jurisdiction isn’t exactly becoming irrelevant, but its role is changing,” Gavryliak told Cointelegraph. “Protocols are increasingly weighing factors such as regulations, institutional credibility and long-term sustainability.”

Crypto hubs now compete on legal infrastructure

Jurisdictions vying to be “crypto hubs” like Singapore and the UAE increasingly compete via favorable legal infrastructure and licensing regimes, such as Singapore’s Payment Services Act and Dubai’s Virtual Assets Regulatory Authority (VARA) rulebooks.

The BVI introduced the Virtual Assets Service Providers Act (VASP Act) in 2023, overseen by the BVI Financial Services Commission (FSC).

Compared with many larger financial centers, it offers a speedy turnaround, responds to VASP applications within six weeks and aims to complete the review process within six months, according to BVI Finance and FSC guidance.

Jowett said beyond favorable tax regimes, clients prioritize “ease of launch” and efficient corporate structuring, which has long been part of the BVI’s appeal. Companies can be set up quickly, the legal framework is flexible, and ongoing reporting is generally lighter than in onshore jurisdictions.

Related: Cayman Islands Web3 foundations jump 70% as CARF reporting rules arrive

The Virgin Islands has also historically been favored because it offers more corporate confidentiality than many larger financial centers.

While BVI companies are still subject to anti-money laundering (AML) and know-your-customer (KYC) requirements, beneficial ownership information is held by registered agents rather than a public register, which reduces disclosure requirements.

British Virgin Islands. Source: Destination Digital

However, none of the companies interviewed by Cointelegraph cited tax neutrality or greater corporate confidentiality as deciding factors for incorporating in the BVI, pointing instead to legal certainty, regulatory clarity and corporate flexibility.

Incorporating, not physically relocating to the Virgin Islands

Yang told Cointelegraph that LTP does not employ full-time staff “on the ground.” Instead, the entity is overseen by its board and supported by staff from elsewhere in the LTP group. 

The same distinction can be seen elsewhere in the industry. Kraken’s parent company, Payward, is incorporated in the BVI, but the exchange’s operations are primarily based in the United States, while 1inch’s team and operations are spread across multiple jurisdictions. 

The BVI isn’t winning the race to attract glitzy headquarters or large-scale engineering teams. Instead, it has become the legal home for many digital asset businesses, while much of the work happens elsewhere. For jurisdictions competing to attract the industry, that just may be enough.

Magazine: Singapore isn’t a ‘crypto hub’ — it’s something better: StraitsX CEO

Japanese financial services group SBI Holdings has acquired a majority stake in Holdbuild, the parent company of Singaporean crypto platform Coinhako, after receiving regulatory approval from Singapore’s central bank.

The approval from the Monetary Authority of Singapore (MAS) enabled SBI to acquire company shares from existing shareholders through a capital injection, making Coinhako a consolidated subsidiary of SBI, the company announced on Thursday.

Coinhako holds a Major Payment Institution license under MAS through its subsidiary, Hako Technology Pte. Ltd. SBI announced its intent to acquire a majority stake in the Singaporean crypto exchange in February.

SBI said it plans to combine Coinhako’s customer base and regional network with its own financial services and digital asset businesses, including its JPYSC stablecoin initiative.

Related: Coinbase Ventures tops crypto VC list for H1 2026

Financial terms of the transaction were not disclosed. SBI did not immediately respond to Cointelegraph’s request for details on the deal.

The acquisition is part of SBI’s broader expansion in digital assets. Earlier this month, the company led a $76 million Series C funding round for institutional crypto exchange EDX Markets. It also shared plans to acquire Bitbank for $289 million, aiming to create one of Japan’s largest crypto exchanges.

SBI deepens crypto industry involvement in Asia

SBI described Singapore as a key hub in its digital asset strategy and said the acquisition would strengthen its presence in Southeast Asia. SBI said it plans to hold its first overseas branch managers’ meeting in Singapore this summer to strengthen its local business foundation.

SBI has accelerated its digital asset expansion in recent months through acquisitions, investments and tokenization initiatives. This week, the company partnered with Ondo Finance to bring tokenized Japanese stocks and integrate its JPYSC stablecoin for settlement and collateral.

In February, SBI and Startale Group unveiled Strium, a layer-1 blockchain focused on tokenized securities and real-world assets. The network is designed to support 24/7 trading, tokenized equity settlement and institutional financial applications as SBI expands its digital asset infrastructure across Japan and overseas markets.

Magazine: Dubai tops Asian crypto hubs, Taiwan passes crypto laws: Asia Express

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The part that rattles valuations is the license. K3 is open-weight, with the full model due for public release on July 27. Anyone will be able to download it, run it on their own hardware, and pay nobody.

Anthropic released Fable 5 last month, and OpenAI shipped GPT-5.6 a week ago, both closed and metered. The assumption underwriting hundreds of billions of dollars in AI infrastructure spending is that frontier capability stays scarce, expensive and American.

A free Chinese model at the top of a coding leaderboard is a direct argument against that.

Meanwhile, Moonshot’s domestic rivals took it worst, with Z.ai falling about 27% and MiniMax about 16%.

For crypto, the headwinds run through the tape rather than through anything onchain. Bitcoin has spent this entire week taking direction from semiconductors.

Last Friday, it rose 4% on the day South Korea’s Kospi jumped 8% and SK Hynix priced $26.5 billion of American depositary shares. This Friday, it fell because a model release in Beijing made the same trade look expensive.

There is, however, a more concrete exposure underneath.

Bitcoin miners have spent two years repositioning themselves as AI data center landlords, signing long-term leases with model developers on the assumption that demand for training and inference compute keeps rising.