Payment processor Mastercard and stablecoin orchestration network Borderless will run a new pilot project to explore how Mastercard’s Crypto Credential standards-based framework can bring greater trust to cross-border stablecoin payments.

The pilot will test how Mastercard’s framework can address the challenge of providing assurance signals that participants can incorporate into their approval, compliance and risk processes, they said in an announcement shared with Cointelegraph.

Mastercard’s framework uses common standards and assurance signals to help bring certainty to blockchain transactions. The pilot will seek out new governance signals that can reduce friction in cross-border stablecoin payments.

Compliance remains one of the biggest friction points for stablecoin payments, according to Kevin Lehtiniitty, CEO and co-founder of Borderless. “Correspondent banking solved this decades ago: originating compliance trusted downstream, no re-execution at every counterparty. Mastercard is applying that model to digital asset payments,” he explained. 

Mastercard’s Crypto Credential will act as a governance and verification layer, but Mastercard will not process or settle funds as part of the pilot, he told Cointelegraph.

The pilot marks Mastercard’s latest push into the stablecoin industry, coming just after the payments giant completed its acquisition of stablecoin infrastructure company BVNK on Monday, in a deal valued at $1.8 billion.

In June, Mastercard announced plans to expand its settlement capabilities to include intraday, weekend and holiday card settlement, including settlement through stablecoins including Circle’s USDC, Paxos-issued PYUSD, USDG and USDP, Ripple’s RLUSD and SoFi’s SoFiUSD.

Magazine: How Mastercard plans to settle card payments with stablecoins

Cointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.

Galaxy Digital reported an $85 million net loss for the second quarter of 2026 as cryptocurrency valuations declined in the period.

That resulted in a $0.09 loss per share posted on Wednesday which Galaxy attributed to the depreciation of digital asset prices during the quarter. 

Revenue at $8.7 billion was down 15% from $10.2 billion in the first quarter of 2026. Analysts had forecast a consensus of $12.7 billion, according to estimates compiled by Yahoo Finance.

Galaxy’s shares fell 6.2% in premarket activity on Wednesday to $20.70, set to extend a nearly 10% decline over the past month.

The total crypto market capitalization fell nearly 15% during the quarter, to $2 trillion on June 30 from $2.35 trillion on April 1, according to CoinMarketCap data.

Despite the slump, the company reported that digital assets generated adjusted gross profit of $66 million and adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $11 million, marking a 34% quarter-over-quarter increase in adjusted gross profit. EBITDA measures a company’s core operating profit by removing financing costs, taxes, asset value changes and one-time expenses.

Galaxy said this reflects the “resilience of our business model and further demonstrates that our earnings are becoming less dependent on the direction of digital asset prices.” 

The company also reported generating adjusted gross profit of $20 million from AI data centers during the quarter, as it ramped up capacity delivery to CoreWeave. Galaxy expects $1 billion in annual revenue from its 15-year partnership with CoreWeave. The company secured $1.4 billion to expand its Texas Helios AI data center in August 2024.

Magazine: Why institutions still prefer Ethereum despite faster blockchains

Cointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.

Just when you thought crypto market morale couldn’t sink any lower, along comes the Coldcard entropy bug to prove you wrong.

The discovery of a flaw in one of the industry’s longest-running hardware wallets last Friday serves as a stark reminder that there is no perfectly safe place to put all your Bitcoin.

Coldcard disclosed the entropy-generation flaw affecting multiple Coldcard devices on July 31. Since then, researchers at Galaxy Digital say attackers have been able to steal more than 1,596 Bitcoin worth at least $100 million through several coordinated attacks.

Wallet manufacturers are now being forced to explain a process most users never even think about: how their wallet generates the private key to protect their Bitcoin.

Michael Tanguma, head of product at Bitcoin custody firm Onramp Bitcoin, tells Magazine:

“The whole model rests on trust that the vendor got it right […] Almost no individual can audit the hardware, the firmware and the entropy generation underneath their device.”

Coinkite, the company behind Coldcard, has released firmware fixes and told affected users to migrate their funds, but the incident has shaken Bitcoin HODLers to the core, and it raises an uncomfortable question:

If Coldcard wallets can be exploited, does that mean all hardware wallets are potentially insecure?

A bug hidden in the foundations

The Coldcard vulnerability did not exploit Bitcoin itself nor break modern cryptography, but it struck at something much more fundamental: randomness.

Every Bitcoin wallet begins by generating a seed phrase from a pool of random data, which means that randomness should be sufficiently unpredictable to make the resulting private keys effectively impossible to guess. Entropy refers to how random it is.

If that randomness is weakened for any reason, attackers can reduce the number of possible keys that could be generate and eventually find a way to reproduce them.

Related: Coldcard hack sparks biggest sub-1 BTC move since FTX: CryptoQuant

Coinkite first alerted users on July 31 that wallets created on affected firmware should be considered at risk and told customers to migrate funds to newly generated wallets. As researchers dug further into the bug over the following days, their attention quickly turned to how a flaw in such a critical part of the wallet had gone unnoticed for more than five years.

Core Lightning developer Dustin Dettmer suggested that it might have originated during firmware changes made in 2021.

He believes that code intended to interface with the hardware random number generator instead disabled it, which caused wallet creation to fall back to MicroPython’s weaker Yasmarang pseudo-random number generator.

His theory has become one of the leading explanations for how the bug may have entered production firmware, although Coinkite has not confirmed that exact sequence of events, and says that it will publish a full technical postmortem “soon.” A Coinkite spokesperson tells Magazine:

“Certain firmware versions had a fallback path in seed generation that could produce weak entropy when generated on the device firmware itself.”

Devices where users generated their own entropy through dice rolls or similar manual methods “were not affected by this specific fallback path,” the spokesperson says.

Weak random number generation (RNG) is not unprecedented, but unlike many other security flaws, it is difficult to detect.

Bitcoin security expert Jameson Lopp noted that RNG vulnerabilities have previously affected a long list of cryptocurrency wallets and libraries, ranging from Blockchain.com’s Android wallet to Trust Wallet.

Weak random number generation is not a new problem. Source: Jameson Lopp

Ledger director of product security Vincent Bouzon tells Magazine that “weak randomness passes output tests,” which means that compromised random-number generators can still produce values that appear random, making flaws difficult to identifiy.

Different wallets, different randomness assumptions

Hardware wallet manufacturers agree that secure entropy generation is non-negotiable, but they take different approaches to achieving it.

Related: Zilliqa Ledger app vulnerability lets attackers recover signer’s private keys

Ledger’s philosophy centers on dedicated security hardware. Bouzon says Ledger devices generate seeds using a true random number generator embedded in a certified Secure Element. The entropy source is certified under the AIS-31 PTG.2 standard and the Secure Element undergoes Common Criteria certification. He says:

“This Coldcard incident was a failure in one specific implementation, not a verdict on secure self-custody […] The generation of that entropy must be anchored in secure hardware, with an architecture that cannot silently downgrade to an untrusted software-based source.”

Generating high-quality randoness is where the whole thing lives or dies. Source: Charles Guillemet

For its part, Trezor combines randomness generated inside the device with randomness supplied by the host computer, rather than depending on a single entropy source, and newer models also incorporate additional hardware sources.

The company also includes entropy checks to confirm that the device actually contributed unpredictable randomness during wallet creation. Tomáš Sušánka, Trezor’s chief technical officer, tells Magazine:

“The takeaway for the whole industry is that randomness cannot depend on a single source or a single line of code being correct.”

Foundation’s Passport wallet similarly rely on multiple entropy sources while emphasizing transparency. Chief executive Zach Herbert says Passport combines randomness generated by separate hardware components before creating a wallet.

The firmware is also published as free and open-source software with reproducible builds, so independent researchers can verify that the software running on the device matches the published code. Herbert says:

“The bug itself was specific to Coldcard […] The larger warning is that this went unnoticed for more than five years while people trusted the product with life-changing amounts of money.”

Trust, transparency and verification

The real divide between Ledger, Trezor and Foundation is not about the importance of randomness, but over how users can be certain that it is actually working.

Ledger argues that independent certification provides the strongest assurance. Foundation relies on open-source development, reproducible builds and welcoming external researchers, and Trezor combines open firmware with layered entropy sources to avoid relying on any single component.

Coinkite’s approach to security disclosures has also come under fire, with several Bitcoin developers criticizing the company over past responses to vulnerability reports and the absence of a traditional bug bounty program.

Related: Fears of AI-driven DeFi hack epidemic overstated for now — but not for long

Herbert argues that welcoming external researchers is itself part of building secure products, alongside open-source development and independent audits.

Nick Percoco, chief security officer at Kraken and former chief security officer at Uptake, sees the Coldcard incident as an opportunity for the industry to adopt stronger standards, no matter which design philosophy manufacturers choose.

“The Coldcard entropy failure should be a wake-up call for the entire hardware wallet industry,” he said, arguing that today’s certification schemes often validate individual components without confirming that production firmware is actually using them correctly.

The Coldcard entropy failure should be a wake-up call. Source: Nick Percoco

Percoco proposed an industry-specific assurance standard requiring independent validation of entropy sources, verification that firmware calls the intended hardware random number generator and certification tied to specific hardware and firmware versions.

But the debate goes further than technical implementation, with voices like Herbert arguing that open-source development also shapes security culture. He points to bug bounty programs and constructive engagement with independent researchers as essential parts of secure product development.

What should Bitcoiners do now?

For Coldcard users, their immediate priority is to follow Coinkite’s migration guidance if they believe their wallets were created using affected firmware.

Longer term, Bitcoiners as a whole should use this episode as a learning moment, with experts like Tanguma stressing the need to avoid design architectures in which any single failure can compromise their funds. He says:

“Today, realistically, you want multisig and independently generated entropy […] The mitigation that actually scales is architectural: setups where no single device, vendor or institution being wrong can lose the funds.”

So for now, the answer appears to be no; not all hardware wallets are insecure.

The Coldcard incident exposed a failure in one implementation, but it has also forced manufacturers to lift the veil on the process at the heart of self-custody: generating a secret that nobody else can predict.

Magazine: The 100x obsession: Fundamentals grow in importance as crypto matures

SpaceX stock fell as much as 11% on Wednesday after record AI investment, and an approaching share unlock overshadowed the company’s stronger-than-expected second-quarter revenue.

SpaceX revenue beats Wall Street estimates

SpaceX reported $7.8 billion in second-quarter revenue, exceeding Wall Street’s estimate of about $6.8 billion. Revenue rose 92% from $4.1 billion in the same period last year, marking a strong first earnings report since the company’s June Nasdaq debut.

Starlink remained the company’s main financial engine. Revenue from the satellite connectivity business rose 66%, while SpaceX’s AI revenue increased by about 250% from a year earlier. The company’s total operating loss narrowed to $143 million from $970 million, according to Reuters.

However, investors focused on how much SpaceX spent to generate that growth. Total quarterly capital expenditure climbed above $18 billion, including $15.83 billion allocated to AI infrastructure. That compared with only $749 million in AI spending during the year-ago period.

Finance chief Bret Johnsen said capital spending would likely remain near current levels over the next several quarters. The outlook raised questions about how long Starlink may need to fund the company’s AI and space-development plans.

AI spending overshadows SpaceX earnings beat

SpaceX is expanding its computing capacity as Elon Musk positions AI as a major part of the company’s future valuation. AI revenue reached roughly $2.6 billion during the quarter, supported by new cloud-computing contracts.

Still, the amount committed to AI infrastructure exceeded market forecasts. At $15.8 billion, AI capital spending more than doubled from $7.7 billion in the first quarter and accounted for most of SpaceX’s total investment during Q2.

The spending contributed to a sharp change in sentiment after the results. SPCX initially fell 7.5% in after-hours trading before extending its decline to more than 11% in Wednesday’s pre-market session. The drop came despite a positive session for broader US equity futures, suggesting that company-specific concerns drove the move.

SpaceX also reported a net loss of $541 million, although adjusted earnings before interest, taxes, depreciation and amortization nearly tripled to $3.5 billion, according to Fortune.

Analysts remain divided on SPCX stock

Piper Sandler lowered its SpaceX price target from $156 to $140 while maintaining a Neutral rating. The brokerage raised its earnings forecasts but cited valuation pressure, uncertain AI cloud contract durability and higher anticipated spending.

$SPCX – PIPER SANDLER CUTS SPACEX PRICE TARGET

Piper Sandler lowered its SpaceX (NASDAQ: SPCX) price target to $140 from $156, while maintaining a Neutral rating.

Despite strong first earnings that beat expectations, the firm sees valuation headwinds. Concerns include a 140%…

— *Walter Bloomberg (@DeItaone) August 5, 2026

The firm now expects fiscal 2027 capital expenditure of about $65 billion, roughly $17 billion above its previous projection. It also warned that the number of tradable SPCX shares could soon increase by more than 140%, creating a potential supply overhang.

Other Wall Street firms retained more bullish forecasts. Bank of America reaffirmed its Buy rating and $235 target, while JPMorgan raised its target from $225 to $240. Mizuho maintained a positive rating and a $200 target.

These forecasts indicate that analysts remain constructive on SpaceX’s long-term business despite concerns about near-term spending and dilution.

🎯 $SPCX Latest Wall‑Street Price‑Target Round‑up

Morgan Stanley｜Overweight｜$300
“We forecast full‑year 2027 revenue of $102 billion, implying annual run‑rate revenue above $100 billion by end‑2026 with little further acceleration. Our base case assumes compute pricing… pic.twitter.com/fPbJ0cEKrp

— katz (@katzspx) August 5, 2026

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SPCX chart puts $104.91 support in focus

SPCX traded at $114.93 on the four-hour chart, down 8.66% during the session after touching an intraday low of $109.21. The stock’s attempted rebound was rejected near $126, returning it below the 78.6% Fibonacci retracement at $119.34.

A sustained recovery above $119.34 could allow buyers to target $130.67. Further resistance stands at $138.63 and $146.58, but the broader trend remains weak following the decline from $172.34 in early July.

On the downside, $109 is the first area to watch. A break below that level would expose the July low at $104.91 and deepen the stock’s drop below its $135 IPO price.

The MACD shows that bearish momentum has eased from its July peak, but the latest rejection and negative Bull-Bear Power reading indicate that sellers remain active. Thursday’s post-IPO share unlock could add another source of volatility for US investors.

Bitcoin has entered the national-security debate again as the Pentagon drafts a nuclear strategy centered on potential regional conflicts with China or Russia.

Pentagon drafts new nuclear strategy

Defense Department policy chief Elbridge Colby is drafting a classified nuclear framework that could expand the role of shorter-range tactical weapons, NBC News reported on Aug. 5, citing five people familiar with the plans.

The emerging strategy would prepare Washington for a possible regional war involving China or Russia. It reportedly seeks to give the US president more limited nuclear options during a crisis instead of relying mainly on long-range strategic weapons.

The approach would mark a departure from decades of US doctrine built around the threat of a large retaliatory strike. Tactical weapons have shorter ranges and are designed for more limited military targets, although any nuclear use would still carry a severe risk of escalation.

The framework has not been adopted as official US policy. Its reported objectives include preventing a conventional conflict from becoming a full nuclear exchange and stopping one adversary from exploiting Washington while it confronts the other.

Why Bitcoin has entered the security debate

The nuclear review does not formally include Bitcoin. However, the focus on China and Russia overlaps with separate US military discussions about decentralized networks, cybersecurity and digital financial infrastructure.

In April, US Indo-Pacific Command chief Admiral Samuel Paparo told lawmakers that the military was operating a Bitcoin node and testing the network in an operational setting, according to a statement from Rep. Lance Gooden’s office.

Paparo described Bitcoin as a peer-to-peer, zero-trust system with potential military applications. Defense Secretary Pete Hegseth later told Congress that classified digital-asset initiatives could give the US leverage across multiple scenarios.

Those disclosures do not mean Bitcoin forms part of US nuclear planning. They show that defense officials are assessing the network independently as a possible cybersecurity, communications or value-transfer tool as competition with China expands.

Crypto commentators have connected the NBC report with those earlier disclosures. The resulting discussion has focused on whether Bitcoin’s decentralized structure could become more valuable during sanctions, cyberattacks or disruptions to traditional payment systems.

US Bitcoin reserve adds a sovereign dimension

President Donald Trump established the Strategic Bitcoin Reserve through a March 2025 executive order. The reserve is capitalized with BTC forfeited through criminal or civil proceedings rather than direct market purchases.

Bitcoin placed in the reserve “shall not be sold,” according to the executive order published in the Federal Register. Treasury and Commerce may also explore budget-neutral ways to acquire more BTC without imposing additional costs on taxpayers.

The White House estimated in 2025 that the federal government controlled roughly 200,000 BTC, but no complete public audit was available at the time. That makes exact current holdings difficult to confirm, particularly because seized assets may be returned to victims or transferred between agencies.

The reserve and the Pentagon’s network tests remain separate initiatives. Still, together they show that parts of the US government increasingly view Bitcoin through strategic and operational lenses, not solely as a speculative asset.

Bitcoin shows no clear reaction to the report

Bitcoin traded near $64,500 on Aug. 5, within an intraday range of roughly $63,860 to $64,650. The price action showed no obvious response to the nuclear strategy report.

Any long-term market effect would likely depend on concrete policy changes, including additional congressional testimony, defense authorization language, or disclosures about how the military uses Bitcoin infrastructure.

For US investors, the report does not create a direct new demand catalyst. It instead adds to the broader case that Bitcoin is being examined as part of sovereign reserves and national-security planning. The connection remains indirect unless the Pentagon announces a formal procurement, reserve, or operational policy involving BTC.