A U.S. federal court has resolved the CFTC’s cases against Caroline Ellison and Gary Wang by imposing five-year trading bans and registration bans of up to 10 years.

The Commodity Futures Trading Commission said on Aug. 19 that the U.S. District Court for the Southern District of New York had entered supplemental consent orders against Ellison, the former chief executive of Alameda Research, and Wang, who co-founded Alameda and FTX.

Under the orders, both former executives must continue assisting the regulator. Ellison cannot trade for five years and is barred from registering with the CFTC for 10 years, while Wang received a five-year trading ban and an eight-year registration ban.

The restrictions did not begin with the latest ruling. According to the regulator, each period runs from Dec. 23, 2022, when the court entered the initial consent orders against the pair.

Those earlier orders also permanently barred Ellison and Wang from violating the antifraud provisions of the Commodity Exchange Act and related CFTC rules. Combined with the supplemental orders, they close the regulator’s enforcement actions against both former executives.

CFTC declines additional financial penalties

The CFTC is not seeking restitution, disgorgement, or civil monetary penalties from Ellison and Wang at present. In explaining its decision, the agency pointed to their assistance in its investigation, their cooperation in connected proceedings, and the financial consequences imposed through the parallel criminal case.

Both pleaded guilty to several federal charges, including conspiracy to commit commodities fraud, in December 2022. Their criminal cases also carried an $11.02 billion forfeiture order for which they were jointly and severally liable, according to the CFTC.

The agency treated their cooperation as a central factor when setting the civil sanctions.

“Ellison and Wang were senior executives who committed fraud at Alameda and FTX for which they were found liable,” CFTC Enforcement Director David I. Miller said. “Their sanctions, however, reflect their material assistance in the Commission’s FTX-related investigations.”

Miller said the resolution showed the value that the enforcement division placed on “robust cooperation.” Although the financial remedies differ from those originally requested, the trading and registration restrictions prevent both defendants from participating in CFTC-regulated markets or registering with the agency during the stated periods.

Ellison and Wang admitted liability in 2022

The cases began after FTX collapsed in November 2022, and the CFTC expanded its fraud lawsuit against founder Sam Bankman-Fried and his companies.

In its December 2022 amended complaint, the regulator accused Ellison and Wang of taking part in a scheme that caused more than $8 billion in FTX customer deposits to be lost. The CFTC charged Ellison with fraud and material misrepresentations involving digital asset commodities, while Wang faced a fraud count tied to their sale in interstate commerce.

Ellison was found liable on both fraud counts included in the amended complaint. Wang was found liable on the single count brought against him.

According to the CFTC’s 2022 allegations, Wang helped create code that gave Alameda an essentially unlimited credit line on FTX. Other exceptions allegedly let the trading firm execute orders faster and avoid the exchange’s automatic liquidation process, even when Alameda lacked enough money to support its positions.

The regulator claimed those features allowed Alameda to withdraw billions of dollars in customer assets without disclosing the special treatment to FTX users. FTX had publicly represented that customer funds were held in custody and separated from company assets, but the complaint alleged that Alameda routinely received and mixed those assets with its own funds.

After becoming Alameda’s sole chief executive, Ellison allegedly directed the firm to use billions of dollars from FTX for trading on other exchanges and investments in digital asset companies. The CFTC also accused her of making misleading public statements about the separation between FTX and Alameda.

Ellison and Wang did not contest their liability under the Commodity Exchange Act and CFTC Regulation 180.1. Their Dec. 23, 2022 consent orders formalized those findings while leaving the court to determine the remaining sanctions later.

Criminal sentences treated cooperation differently

The supplemental CFTC orders follow separate criminal sentences that also consider how extensively each defendant assisted U.S. prosecutors.

Ellison received a two-year prison sentence in September 2024 after serving as a key government witness at Bankman-Fried’s trial. She reported to federal prison in Connecticut that November.

U.S. District Judge Lewis Kaplan imposed prison time despite prosecutors detailing Ellison’s cooperation. At sentencing, the judge said her assistance did not remove the need to deter fraud, according to the November 2024 report.

Wang avoided an additional prison term. In November 2024, Kaplan sentenced him to time served and three years of supervised release after prosecutors described his help in tracing funds and explaining FTX’s code and internal financial systems.

The court found Wang’s cooperation especially useful because he had written parts of the exchange’s software and could explain the privileges given to Alameda. During Bankman-Fried’s criminal trial, Wang testified about the code that allowed the trading firm to access customer funds and operate without the restrictions applied to ordinary users.

As Wang’s sentencing report detailed, prosecutors said he was the first member of Bankman-Fried’s senior group to approach U.S. authorities in 2022. Ellison later became a central witness against Bankman-Fried, who received a 25-year prison sentence in March 2024.

FTX litigation has continued into 2026

Legal claims connected to FTX have remained active beyond the criminal cases against its former executives.

In May 2026, crypto.news reported that law firm Fenwick & West had agreed to pay $54 million to settle a class action brought by former FTX customers. The proposed settlement still required court approval when it was announced.

The customers accused Fenwick of helping establish corporate and legal structures that allowed FTX and Alameda to move and mix customer funds without adequate controls. According to filings cited in the report, the plaintiffs relied in part on testimony from Ellison, Wang, and former FTX engineering director Nishad Singh concerning improper loans, false statements, and the handling of customer money.

Singh reached his own supplemental settlement with the CFTC in April 2026. He agreed to pay $3.7 million in disgorgement and accepted a five-year trading ban and an eight-year registration ban, with the regulator also citing his cooperation with investigators.

Crypto-aligned political spending appears to have delivered early momentum for Fairshake and its affiliated super PACs, with four of the five candidates backed by the organization’s ad campaigns advancing in Tuesday’s US primaries. The results span Florida, Alaska, and Wyoming—an indication that the industry’s political outreach may be shaping the competitive field ahead of the 2026 midterms.

According to reporting on the primaries and Fairshake’s fundraising record, the Protect Progress and Defend American Jobs PACs collectively spent about $3.6 million on House and Senate races across the three states. While three candidates secured primary wins and one was expected to advance, a separate Florida race also highlighted the intensity of the PACs’ message—where negative ads funded by Protect Progress targeted an opponent who still won.

Key takeaways

• Fairshake-linked super PACs supported multiple candidates in primaries across Alaska, Florida, and Wyoming, with four advancing or winning.
• The PACs spent roughly $3.6 million combined on those contests, according to the cited breakdown of ad spending.
• In Florida’s 24th district, a candidate won despite being targeted by more than $2 million in Protect Progress-funded negative ads.
• Lawmakers are on recess until September, when the Senate is expected to address a cloture motion on the CLARITY Act—potentially influenced by the makeup of the next Congress.

Fairshake-affiliated PACs back candidates across three states

Tuesday’s primary outcomes reflected the reach of Fairshake’s political strategy through two affiliated PACs: Protect Progress (Democratic support) and Defend American Jobs (Republican support). The ad spending covered House and Senate contests in Alaska, Florida, and Wyoming.

In Florida’s 23rd congressional district, Democrat Lois Frankel won re-election. The campaign benefited from Protect Progress, which spent more than $150,000 on supportive media, according to the article’s figures.

On the Republican side, Defend American Jobs backed candidates in Alaska, Florida, and Wyoming. The PAC reported a combined $1.5 million in advertising support across these races—an effort that helped deliver primary victories for two candidates and positioned a third to move forward.

Defend American Jobs-supported Republican Sydney Gruters won her primary in Florida’s 16th district, while Representative Harriet Hageman won the Wyoming Senate Republican primary. In Alaska’s at-large congressional district, Republican Nick Begich was expected to advance following the primary results referenced in the report.

Florida’s 24th district: heavy negative spending failed to stop a winner

Not all of Fairshake’s political influence showed up in straightforward wins. A Democrat in Florida’s 24th district advanced as well, despite facing a barrage of negative advertising funded by Protect Progress.

Oliver Gilbert defeated challengers Shevrin Jones and Kendrick Meek with 34.4% of the vote, according to the cited New York Times results page. The primary also drew scrutiny because Protect Progress reportedly funded more than $2 million worth of negative ads aimed at Gilbert.

In an Aug. 12 report, the Miami Herald said Gilbert argued that “Trump’s tech billionaire buddies” were behind “crypto con artists trying to buy a Democratic primary” through Protect Progress ads. The Miami Herald report stated that the advertisements included fake Miami Herald headlines that misrepresented Gilbert’s positions, while noting that a PAC spokesperson claimed “the underlying facts in our ad are true.”

Gilbert’s acceptance speech, as described in the source material, did not explicitly mention the crypto industry or the PAC ads. Fairshake spokesperson Geoff Vetter, meanwhile, said the PAC was “just getting started building the largest pro-crypto Congress in history” after the three-state primary outcomes.

How much Fairshake spent—and why the timing matters

Fairshake’s political footprint has been a defining feature of the 2024 election cycle and the run-up to the 2026 midterms. The article notes that Fairshake reported holding a $193 million war chest as of January. It was also responsible for funding more than $130 million worth of ads supporting candidates it viewed as pro-crypto in the 2024 cycle, while opposing many candidates who criticized the industry or voted against what the PAC described as its interests.

For the 2026 period, the piece states that by June, the committee had spent more than $82 million on races ahead of the midterms, citing additional earlier reporting.

The reason this matters for investors and market participants is that crypto policy in the US—especially regulation around digital assets—often depends on the composition of Congress and the priorities lawmakers set after election cycles. As advertising translates into electoral strength, it can influence which bills move quickly and which stall.

CLARITY Act on deck as Congress returns

The immediate legislative calendar adds urgency to the primary results. The source notes that both the US House and Senate are on recess until September. During that period, the Senate is expected to address a cloture motion on the Digital Asset Market Clarity (CLARITY) Act.

The piece emphasizes that the bill passed the House in July with bipartisan support on a 294–134 vote. However, it also highlights that some Senate Democrats have been pushing for stronger ethics provisions tied to concerns about the Trump family’s crypto investments.

Whether CLARITY advances this session may depend on what happens in November. The article warns that Congress could shift from a Republican to Democratic majority depending on key races—some of which may be influenced by PAC activity like Fairshake’s. If the current session does not address CLARITY before 2027, lawmakers elected in November would potentially have the leverage to move the bill forward—or block it.

For readers tracking the intersection of crypto finance and US politics, the next watch items are straightforward: September’s Senate procedural steps on CLARITY, the broader outcomes across 2026 midterm races, and how PAC spending patterns evolve once the full midterm field is set.

Arthur Hayes has proposed allocating roughly 20% of Flop Network’s FLOP token supply to testnet participants over 10 years as part of a self-funded decentralized computing network for artificial intelligence agents.

Arthur Hayes said in an Aug. 19 Substack article that Flop Network would connect AI agents seeking computing power with miners operating internet-connected hardware, using FLOP as the network’s payment and reward token.

The BitMEX co-founder described the proposed system through a fictional creation story, but the article also provided new information about the project’s token distribution, economic model, and intended users. Hayes said the token launch would follow a fair-start model, with no presale needed because he had funded the development team himself.

Under the planned distribution, people who contribute to the Flop Network testnet would collectively receive about one-fifth of the supply by the end of a 10-year period. Hayes did not disclose the total number of FLOP tokens, the rate at which the testnet allocation would be released, or the activities that would determine each participant’s share.

Flop Network would sell compute through FLOP

Flop Network’s proposed market would price AI workloads according to the number of floating-point operations, or FLOPs, required within a defined period. Miners would process requests using a model selected by the customer and receive payment in the network’s native token.

According to Hayes, current AI services make price comparisons difficult because each model defines and charges for its own input and output tokens differently. He described model tokens as an abstraction of the computing work performed, rather than a standard unit that customers can compare across providers.

Cloud companies already rent computing capacity, but Hayes said their billing systems do not charge customers according to the actual FLOPs consumed. Flop Network would try to create a common spot price for computing work regardless of the model, hardware type, or location of the machine processing the request.

Anyone with an internet-connected computer could become a compute provider under the proposed design. AI agents and human users would submit jobs specifying how much work they require, the time available and the model to be used, while FLOP would settle the transaction.

Hayes wrote that the currency would represent “a claim on compute,” allowing buyers and sellers to establish a consistent price for a given amount of processing work. He called FLOP “food for AI agents” because autonomous software requires computing power each time it performs an inference or completes a task.

FLOP miners would earn two types of rewards

Instead of using computing power only to produce hashes, as Bitcoin miners do, Flop Network would rely on a process called Proof of Useful Inference, or PoUI. Hayes said miners would earn FLOP block rewards for supporting the network and inference fees for completing requests.

The article did not explain how validators would confirm that a miner had used the requested model, completed the correct number of operations, or returned a valid result. As crypto.news previously reported, Flop Labs has not released the technical method for checking nondeterministic AI outputs, detecting incorrect work, or penalizing providers that submit false results.

Public documentation has also not established which blockchain will support FLOP, how many validators will operate at launch, or whether ordinary consumer hardware will be able to compete with dedicated data-center equipment. No white paper, security audit, block explorer, or official token contract had been published when the earlier report appeared on Aug. 19.

Alongside compute, Hayes said autonomous agents would need continuous access to stored memories. He argued that keeping those records on decentralized storage would allow an agent to retain its history without depending on one company that could restrict or remove access.

His proposed economic loop combines both needs. Agents would spend FLOP on processing work and memory services, while miners and other network participants would receive tokens for supplying those resources.

Flop Network ties testnet use to token distribution

Hayes said the FLOP token would help Flop Network attract miners, agents, and speculators at the same time, addressing the difficulty new networks face when they launch without an existing group of buyers and service providers.

Rather than sell an early allocation to venture investors, Hayes said he had self-funded the team responsible for developing the network. He argued that large presales often leave retail buyers facing an excess supply of tokens after an asset begins trading.

Flop Network would instead distribute roughly 20% of its token supply to testnet users over 10 years. The post did not specify whether the remaining supply would fund mining emissions, validators, contributors, a treasury, or other groups.

Eligibility rules also remain unpublished. Flop Labs has not said whether users will qualify by providing compute, validating jobs, storing agent memories, completing testnet transactions, or promoting the project as a community partner.

Hayes said the distribution should reward people who provide useful work to the network, although his article also claimed participants could become “generationally wealthy” by holding the tokens they receive. The post carried a disclaimer stating that his personal views should not serve as investment advice or a recommendation to make investment transactions.

The project’s Aug. 18 announcement placed a large FLOP airdrop in the fourth quarter of 2026, and the Flop Network genesis block in the first quarter of 2027. Neither the Substack article nor the announcement explained where recipients would hold the token if distribution starts before the native network becomes operational.

U.S. agent payments already favor stablecoins

Flop Network would enter a machine-payment market where dollar-backed stablecoins already process live transactions. A May 2026 Keyrock report found that AI agents had settled $73 million through 176 million transactions over 12 months, with USDC accounting for 98.6% of the tracked payments.

Keyrock said 76% of those transactions were worth less than the $0.30 fee floor associated with card payments. According to the report, Layer 2 stablecoin transfers cost about $0.0001, making them suitable for small purchases such as API calls, data access, and automated online services.

For U.S. businesses, Coinbase began allowing commercial customers to accept agent USDC payments through its x402 standard in July. The exchange said an agent can receive payment instructions from an online service, sign a stablecoin transfer, and resubmit its request with proof that it paid.

FLOP would differ from that dollar-based model by giving agents a token tied to the supply of computing work, according to Hayes. His proposal did not explain how miners would cover dollar-denominated electricity and hardware costs when their income comes through a freely traded token, nor did it provide a method for keeping the cost of compute stable when FLOP’s market price changes.

Machine commerce has also raised questions beyond payment settlement. In June, the American Arbitration Association and Integra Ledger introduced legal records for agent transactions, covering consent, governing law, and dispute procedures when software purchases services without direct human review.

Hayes said his next article would explain why the agent economy requires a spot market priced by floating-point operations per unit of time and how Flop Network intends to create it.

The U.S. Securities and Exchange Commission has unveiled a new regulatory proposal aimed at giving crypto issuers a clearer path to raising capital—while attempting to keep investor protections intact. In remarks accompanying the initiative, SEC Commissioner Hester M. Peirce said the move represents progress away from what she characterized as the agency’s prior reliance on “inapt” rules for digital asset offerings.

SEC Chair Paul S. Atkins, in a separate statement, argued that the SEC’s earlier enforcement-led posture has pushed some investment activity “offshore,” potentially limiting the protections the regulator can offer to investors in the U.S. Taken together, the statements position the proposal as an attempt to shift from case-by-case litigation to a more predictable framework for certain crypto-related investment contracts.

Key takeaways

• SEC Commissioner Hester Peirce called the new proposal a step toward “clear, sensible, enforceable” rules for crypto offerings.
• SEC Chair Paul Atkins linked prior enforcement emphasis to capital shifting “offshore,” reducing investor protections available domestically.
• The SEC’s Tuesday notice outlines a “clear and fit-for-purpose” framework for certain investment contracts involving crypto assets.
• The proposal arrives after the U.S. Senate failed to advance the broader Digital Asset Market Clarity (CLARITY) Act.
• SEC leadership signaled willingness to proceed with rules even without CLARITY’s passage, according to Atkins’s recent comments.

SEC proposal seeks a dedicated framework for crypto investment contracts

In a Tuesday notice, the SEC proposed new rules intended to establish what the agency described as a “clear and fit-for-purpose framework for certain investment contracts involving crypto assets.” The core goal is to allow qualified entities to raise capital with rules that are tailored to how these offerings are structured, rather than attempting to force crypto into existing categories that may not map cleanly to modern digital asset arrangements.

Peirce’s remarks framed the proposal as a meaningful improvement over the SEC’s previous approach. She pointed to the challenges faced by market participants under the agency’s tendency to apply a set of rules she called “inapt” to crypto. Her emphasis was not merely on regulatory activity, but on the shift toward guidance that market participants can interpret and comply with in advance—an issue that affects how issuers plan compliance, structure token sales, and manage investor disclosures.

For investors and traders, the stakes are similarly practical. A clearer framework can reduce uncertainty around which offerings fall within enforceable boundaries, potentially improving the quality and consistency of disclosures rather than leaving compliance largely determined by enforcement outcomes after the fact.

Atkins: enforcement pressure may have driven activity abroad

Atkins’s separate statement added a policy argument for why the SEC is moving toward rulemaking. He said the SEC’s prior enforcement-heavy approach has “driven investment offshore,” which he argued can limit the protections investors receive “here.”

That perspective effectively reframes the regulatory debate: rather than focusing only on whether the SEC can prove violations in court, Atkins suggested that a rules-based system is better positioned to provide investor safeguards within the U.S. market. The underlying tension is that strict enforcement without corresponding guidance can leave firms uncertain about compliance boundaries, encouraging them to seek alternatives—potentially in jurisdictions with different regulatory approaches.

While the proposal’s details were not laid out in the statements themselves, the framing indicates a shift in emphasis: the SEC is trying to offer a workable regulatory runway so capital raising can occur under an established structure, rather than depending primarily on enforcement-driven clarity.

Rulemaking comes after CLARITY Act stumbles in the Senate

The timing of the SEC’s action matters. According to the reporting referenced in the article, the proposal was announced days after the U.S. Senate failed to advance the Digital Asset Market Clarity (CLARITY) Act—legislation intended to provide a broader regulatory framework for financial regulators overseeing the crypto industry.

In addition, the article notes that SEC leadership had previously indicated the agency would not wait indefinitely for congressional action. On July 27, Atkins told CNBC that the SEC was “ready, willing, and able to come out with rules” on digital assets if the Senate failed to pass the CLARITY Act.

That backdrop helps explain the strategic logic of the SEC’s proposal. When comprehensive statutory changes stall, regulators often face pressure to fill gaps through rulemaking. The SEC’s approach can also be read as an attempt to create interim structure—particularly for crypto offerings that the SEC views as falling under “investment contract” analysis—while Congress considers whether and how broader market-wide definitions should be codified.

Market participants weigh odds for CLARITY, and watch the SEC’s next steps

Beyond the SEC’s statements, the article references Galaxy Digital’s assessment of CLARITY’s prospects. It says Galaxy cut its odds on passage in 2026 to 10%, warning that multiple political issues remain unresolved. The referenced note also suggests the Senate would have only about two to three weeks to pass the bill when it reconvenes on Sept. 14.

That kind of uncertainty underscores why the SEC’s move may carry outsized significance for the market. If investors and issuers see congressional action as unlikely in the near term, rulemaking becomes the main mechanism shaping how crypto offerings are regulated in the U.S.

Still, what happens next will likely determine how meaningful the proposal is for day-to-day compliance. Investors, issuers, and compliance teams should watch for how the SEC defines the scope of “certain investment contracts involving crypto assets,” how it structures registration and disclosure requirements under the framework, and what the timeline looks like for finalization. Equally important will be whether market participants interpret the rules as reducing uncertainty enough to outweigh remaining legal and political risks.

For now, the SEC’s proposal—and the leadership’s explicit comments about the limitations of earlier “enforcement-first” strategy—sets up an important test: can clearer, fit-for-purpose rules deliver the predictability both regulators and market participants have been seeking, especially in the absence of a comprehensive CLARITY pathway?

Centrifuge has added Symbiotic’s liquidity network across three tokenized funds that represent about $1.6 billion in assets under management, giving eligible holders another route to exchange their positions for USDC.

The integration covers Janus Henderson’s JAAA, an AAA-rated collateralized loan obligation strategy, JTRSY, a short-duration US Treasury strategy and New York Life Investment Management’s HYB, a US high-yield corporate bond strategy.

Symbiotic’s Liquid Lane uses an onchain request-for-quote (RFQ) marketplace where market makers can tap liquidity from vaults to fill redemption requests. Market makers can then redeem the acquired fund tokens through the issuer or sell them through another RFQ transaction.

The arrangement allows investors to receive USDC immediately while the funds’ normal redemption can take place separately.

Centrifuge is an asset tokenization and vault platform where asset managers issue and manage tokenized funds. Janus Henderson, a global asset manager with about $500 billion in assets under management, has been a significant contributor to the platform’s growth through its JAAA and JTRSY products.

By December 2025, Centrifuge had attracted about $1.3 billion in new inflows, driven primarily by the two Janus Henderson funds, according to Token Terminal. JAAA alone had contributed about $1 billion in total value locked and was one of the largest tokenized funds in the market.

Related: Centrifuge brings S&P 500 onchain in tokenized fund launch

Symbiotic joins existing liquidity routes

Liquid Lane is not the first liquidity route available for Centrifuge’s tokenized funds, Felix Lutsch, Symbiotic’s head of ecosystem, told Cointelegraph.

“We’re not claiming to be first, and other liquidity routes exist. That’s healthy for the market,” Lutsch said.

Centrifuge announced a partnership with Wintermute in February 2025 to provide 24/7 instant redemptions for JTRSY. HYB launched in June with a separate liquidity arrangement for near-instant redemptions.

Lutsch said the distinction with Liquid Lane is the capital structure behind the transactions rather than their speed. Its marketplace allows multiple market makers and curators to participate without market makers having to pre-fund and carry inventory for individual assets, he said.

“The bigger constraint has been flow,” Lutsch said, adding that low trading volumes in tokenized assets have historically given market makers little incentive to commit capital.

He said aggregating redemption demand across issuers and asset classes could improve those economics as tokenized funds are increasingly used as collateral and financing assets in onchain markets.

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