The Blockchain Association and Crypto Council for Innovation sued Illinois on Aug. 21 to block a 0.2% digital asset tax scheduled to take effect on Jan. 1, 2027.

The complaint was filed in the Seventh Judicial Circuit Court in Sangamon County. It names Illinois Revenue Director David Harris, Attorney General Kwame Raoul and Sangamon County State’s Attorney John Milhiser as defendants in their official capacities.

The filing is the second industry lawsuit challenging the Illinois crypto tax. The Digital Chamber brought a separate case in July.

Coinbase CEO Brian Armstrong urged senators to support the CLARITY Act during an Aug. 20 interview, arguing that permanent legislation could protect crypto users and limit regulatory overreach by future administrations.

The campaign is approaching a confirmed deadline. Senate records show that the cloture motion on H.R. 3633 will ripen on Sept. 15 at 2:15 p.m. Eastern.

The vote concerns whether the Senate should begin considering the bill. It is not a final vote on passage.

Armstrong says CLARITY would protect consumers

“The current status quo today is that there isn’t much clarity about what the rules are,” Armstrong told CBS. He said the resulting uncertainty was exposing ordinary Americans to harmful products.

Armstrong argued that the legislation would give law enforcement more tools against illicit activity. He also cited clearer rules for stablecoin rewards, digital-asset fundraising and other products offered to consumers.

He presented written legislation as protection against “bad government or overreach.” Unlike agency interpretations, federal statutes generally cannot be reversed solely because a new administration changes its regulatory policy.

Armstrong’s claim that the legislation would prevent another FTX-style failure is forward-looking. The bill has not been tested under comparable circumstances.

FTX’s collapse involved fraud and misuse of customer assets at an offshore exchange. CLARITY contains registration, disclosure and customer-protection provisions, but it cannot guarantee that regulated companies will never fail.

CLARITY Act would divide federal oversight

The bill would establish definitions for digital commodities, network tokens and other digital assets. It would divide responsibilities between the Securities and Exchange Commission and Commodity Futures Trading Commission according to an asset’s characteristics and the transaction involved.

The proposed framework also includes registration requirements for digital-commodity exchanges, brokers and dealers. Other provisions address custody, customer assets, disclosures, anti-money-laundering obligations and treatment during insolvency.

The House passed its version in July 2025 by 294-134. The Senate Banking Committee then advanced the legislation by 15-9 on May 14, 2026.

Because the Senate committee amended the House bill, passage would not immediately send the legislation to the president. The chambers would first need to approve identical text.

September vote requires Democratic support

Senate Majority Leader John Thune filed cloture before the August recess. The official schedule places the motion on Sept. 15, one day after senators return for regular business.

Cloture requires 60 votes. Republicans hold 53 seats, meaning at least seven Democrats must support the motion if every Republican votes for it. Committee approval does not guarantee those votes on the floor.

Armstrong said he expects more than 60 senators to support the motion. That remains an industry executive’s forecast, not a confirmed vote count.

Lawmakers are still negotiating ethics restrictions for elected officials, stablecoin rewards, decentralized finance provisions and illicit-finance safeguards. As previously reported, these unresolved disputes delayed Senate action before the recess.

President Donald Trump called for a “fair version” of the bill during an Aug. 19 White House event. The meeting included Armstrong, Robinhood CEO Vlad Tenev, Kraken co-CEO Arjun Sethi and federal regulators.

Agency rules remain an incomplete alternative

Armstrong later wrote that “clarity is coming either way.” He pointed to possible SEC and CFTC action on Sept. 16 if senators block the bill.

“A new set of rules from the CFTC and SEC on September 16th” is Armstrong’s characterization. Neither agency has published a finalized joint rule package carrying that effective date.

CFTC Chair Michael Selig has said the agency is prepared to use its existing authority with or without legislation. The SEC also proposed Regulation Crypto Assets on Aug. 18, beginning a rulemaking process rather than issuing immediately effective market-structure rules.

Agency action cannot fully reproduce legislation that grants new authority or changes federal statutes. Rules can also face public-comment requirements, court challenges and later revision.

Bitcoin and Ethereum rose 5.9% and 2.8%, respectively, during the day of Armstrong’s interview, according to CBS. The gains coincided with the White House policy push and a broader market rally, but available evidence does not isolate CLARITY as the sole cause.

The Sept. 15 cloture result will determine whether senators begin debate. Even a successful vote would leave amendments, final Senate passage and House reconciliation ahead.

Term Labs confirmed on Aug. 23 that a governance exploit had affected its lending vaults. Blockchain security firms estimated that the attacker extracted approximately $8.5 million in cryptocurrency.

The protocol said it was investigating and would release additional information afterward. It has not confirmed the loss estimate, identified the affected vaults or explained how the attacker gained governance control.

Term Labs confirms its vault governance exploit

“We are aware of a governance exploit impacting Term vaults,” Term said. “We will share more details once it has been further investigated.”

The statement did not say whether Term Labs had paused deposits, withdrawals or governance functions. It also did not identify any contracts that users should avoid. No recovery proposal, reimbursement commitment or deadline for a postmortem had been announced when this report was prepared.

Term Labs operates a decentralized lending system built around fixed-rate borrowing and lending. Its strategy vaults allocate deposited funds through programmed contracts. The protocol has not said whether every vault was exposed or whether the incident affected only specific deployments.

Security firms estimate losses at $8.5 million

CertiK classified the incident as a governance attack and estimated the loss at approximately $8.5 million. That amount remains an external estimate rather than a figure confirmed by Term Labs.

PeckShield reported that the exploiter drained approximately 2,843 ETH, valued at about $6.87 million at the time, plus 1.68 million USDC. According to its tracing, the attacker subsequently exchanged the USDC for approximately 1.68 million DAI.

Onchain investigator ZachXBT said he may automatically reject future requests from crypto victims in seven jurisdictions.

The named jurisdictions were Canada, the UK, India, Nigeria, Morocco, Algeria and Bangladesh. ZachXBT reportedly based the proposed restrictions on his personal experiences handling cases connected to victims in those locations.

He also plans to restrict access to some support services through an upcoming website. However, no website address, launch date or complete access policy had been published when this report was prepared.

ZachXBT may filter cases by victim location

ZachXBT reportedly described the named jurisdictions as producing some of his worst case-handling experiences. He said he would “likely automatically reject” future assistance requests originating from those regions.

The remark describes a possible future policy rather than an active prohibition. There is no evidence that he has already blocked every request from the seven jurisdictions or stopped working on cases previously submitted by their residents.

“Likely automatically reject” remains a stated intention. ZachXBT has not published final eligibility rules or confirmed that every applicant from the named jurisdictions will be refused.

The list reflects ZachXBT’s personal assessment. It does not come from a government agency, court or international sanctions authority. The remarks also did not provide case data showing how many requests he received from each country or why individual cases produced poor outcomes.

Planned website will restrict some regional access

ZachXBT said his forthcoming website would prevent users in some jurisdictions he considers “low quality” from accessing crypto support services. The wording suggests that the platform could use regional eligibility controls when accepting investigation requests.

“Low quality” is ZachXBT’s subjective description. No published methodology, performance data or independent assessment currently supports that classification.

Important operating details remain unavailable. ZachXBT has not disclosed which services the website will provide, whether restrictions will depend on residency or internet location, or whether applicants can challenge an incorrect classification.

He also has not said whether exceptions will apply to large thefts, coordinated attacks or cases involving victims across several countries. No fee model, privacy policy or terms of service have been released publicly.

The lack of details prevents confirmation that all seven named jurisdictions will be blocked at launch. The policy could change before the website becomes operational.

Independent investigators fill a recovery gap

ZachXBT regularly traces funds stolen through phishing, wallet compromises and exchange-related scams. His work can identify transaction paths, deposit addresses and links between wallets. Such findings may help exchanges or authorities assess a victim’s report, but an investigator cannot independently freeze or return assets.

That limitation matters because recovery frequently requires cooperation from centralized exchanges, stablecoin issuers and law enforcement agencies. Blockchain tracing can show where assets moved, but control over a destination wallet or exchange account remains with its operator.

In one earlier investigation, ZachXBT estimated that Coinbase users lost at least $65 million through social-engineering scams during two months. Coinbase did not confirm that estimate.

More recently, his analysis helped trace funds after a fake Ledger application stole $9.5 million from more than 50 reported victims. The incident showed how individual researchers can become an informal point of contact after large thefts.

Victims still have official reporting routes

The proposed restrictions would apply to ZachXBT’s private assistance, not to official reporting channels. Victims can still contact local police, national fraud-reporting agencies, exchanges, wallet providers and relevant financial regulators.

They may also submit transaction hashes, wallet addresses and communications from suspected scammers to blockchain analytics companies. Prompt reporting can matter when stolen assets reach a centralized service capable of restricting an account.

The next verified development will be the publication of ZachXBT’s website and its written eligibility policy. Those materials should clarify which countries are restricted, what services remain available and whether current cases will continue.

Until then, the comments should not be presented as a completed ban. They indicate that ZachXBT is considering location-based limits after what he described as poor personal experiences handling cases from the seven jurisdictions.

Bitcoin traded near $76,600 on Aug. 23 after reaching $79,500 two days earlier, prompting claims that veteran trader Peter Brandt’s 58,000–62,000 forecast was wrong.

The historical price record shows otherwise. Brandt issued the forecast in January when Bitcoin traded near $92,400. Bitcoin later entered his stated range and fell to approximately $57,717 on July 1. It subsequently spent weeks near or slightly above the target zone before beginning its latest recovery.

The rally therefore does not invalidate the completed forecast. It shows that market conditions changed after Bitcoin reached the area Brandt identified.

Bitcoin reached Brandt’s target months after his call

Brandt wrote on Jan. 19 that “$58K to $62K is where I think it is going.” He reportedly expected the move within two weeks, although he also acknowledged that his assessment could be wrong.

Bitcoin did not meet that short timetable. However, the price eventually reached the forecast range during the 2026 downturn. Fortune recorded Bitcoin at $58,278 on July 1, while other market data showed an intraday low near $57,717.

The difference between price and timing matters when assessing the forecast. Brandt correctly identified a later trading zone, but the projected two-week horizon was too short. Calling the entire forecast wrong because Bitcoin now trades above $76,000 ignores the intervening decline.

As crypto.news previously reported, Brandt’s January downside target was later reached before he began identifying evidence of a possible market bottom.

Brandt changed position after Bitcoin completed its pattern

Brandt did not remain committed to the bearish position after the chart structure changed. He said BTC’s prolonged inverse head-and-shoulders pattern initially had a 60% probability of resolving downward because the wider trend remained weak.

The completion of the pattern changed his view. Brandt said he “bought the breakout for better or worse” after BTC moved above the neckline. The quotation reflects a trading decision, not a guarantee that the rally will continue.

His updated position illustrates how technical traders often work. A forecast applies while its underlying pattern and price conditions remain valid. A confirmed breakout can invalidate the next bearish setup even when an earlier downside target was achieved.

Brandt also pointed to what he calls “price walls,” a decades-old charting method that identifies areas where tightly grouped price bars may later act as support or resistance. He did not provide a guaranteed upside target in the latest post.

Short liquidations and ETF demand accelerated Bitcoin’s rally

The crypto rose from approximately $62,679 on Aug. 17 to $79,500 on Aug. 21, a gain of nearly 27% from the weekly low. It later retreated toward $76,600 but remained up more than 20% over seven days.

Forced short covering helped drive the early part of the move. Traders holding leveraged bearish positions had to buy BTC when prices crossed their liquidation levels, adding demand during the breakout.

However, the rally was not based entirely on derivatives. U.S. spot Bitcoin exchange-traded funds recorded $606 million in net inflows on Aug. 20, following approximately $517 million the previous day. Five-session inflows reached about $1.92 billion.

In related coverage, crypto.news reported that the combination of short liquidations and spot ETF demand produced one of the market’s largest squeeze events since 2021.

The ETF inflows provide evidence of spot demand alongside forced derivatives buying. Continued inflows would offer stronger support for the rally than short covering alone.

Treasury action changed the macro backdrop

The reversal also followed a change in U.S. bond-market conditions. On Aug. 19, the U.S. Treasury announced that it would at least double the maximum size of liquidity-support buybacks for longer-dated government securities.

The current maximum of $2 billion per operation will increase to at least $4 billion beginning Sept. 9, according to the Treasury. The operations cover the 10-to-20-year and 20-to-30-year sectors.

Long-term Treasury yields declined after the announcement, while the U.S. dollar weakened. Bitcoin, gold and other scarce assets rallied as traders responded to the change in liquidity conditions.

Bitcoin’s next test is whether it can reclaim and hold $79,500 before challenging $80,000. Failure to maintain the breakout could return attention to the low-$70,000 region and the completed pattern’s neckline.

Brandt’s January price target was reached, but his original timing was not. His later bearish view also changed after the market produced a confirmed bullish breakout. Those are separate forecasts and should not be combined into a claim that the $58,000 call failed.