Digital asset treasury companies have mostly lagged the cryptocurrencies they hold, with only four of the 20 largest trading above the value of their token reserves, according to a new analysis by DWF Ventures.

DWF Ventures compared the share prices of publicly traded crypto treasury companies with the performance of the tokens they hold. It found that most of the 20 largest companies trade at a market-value-to-net-asset-value ratio, or mNAV, below 1, meaning their shares are valued at less than their crypto holdings.

The calculation excludes debt and preferred stock, according to the analysis. Investors therefore need to examine those obligations separately before treating a low mNAV as a discount on everything a company owns.

Crypto treasury stocks have mostly trailed direct holdings

Since the companies began their treasury strategies, buying and holding the underlying token has generally produced a better return than buying their shares, the analysis found. Even where a stock came out ahead, its excess return was usually small compared with the additional risks attached to owning a company.

A treasury share does not track a token in the same way an exchange-traded fund is designed to. Its price also depends on when management buys crypto, how it raises cash, how many new shares it issues, and whether investors expect the company to expand its holdings.

The difference has been visible over shorter periods. Since July, the analysis found that some treasury stocks outperformed their tokens by 15% to 40% as their mNAV ratios climbed from roughly 0.5–0.8 to 0.7–1.0. Hyperliquid-focused PURR and Zcash-focused CYPH recorded returns 31% and 38% above their respective tokens during that period.

According to the analysis, their token holdings per share changed little over those months. Much of the stock gains instead came as investors paid more for exposure to the companies while crypto prices rose. The authors found that the underlying token remained the stronger performer across most periods longer than three months.

A recent U.S. example shows how quickly a treasury stock can move. On Sep. 20, crypto.news reported Strategy’s one-month gain of 47.65% through the Sep. 18 close, a period in which Bitcoin also recovered. The stock’s return over that window does not establish how it has performed against Bitcoin since the company began buying the asset.

A premium lets crypto treasuries buy more tokens per share

The analysis identifies token holdings per share as a central measure of a treasury company’s progress. When a firm’s stock trades above the value of its crypto reserves, it can sell shares, use the proceeds to buy tokens, and potentially increase the amount backing each existing share.

That process becomes harder when mNAV falls below 1. Selling new common shares at a discount can dilute existing investors, while waiting to raise funds may slow further purchases. Companies can also use convertible debt or preferred shares, though each financing method brings terms that common shareholders must weigh.

Strategy has used convertible debt as part of its Bitcoin financing, according to the analysis. Convertible holders may exchange their claims for shares if the stock reaches the agreed terms; until then, the company must manage the obligations attached to its capital structure. The analysis cautions that preferred dividends and other commitments can put pressure on reserves if financing becomes more difficult.

Recent U.S. filings show how differently treasury operators can respond to those demands. As covered in Strategy’s September update, the company bought no Bitcoin and sold no shares through its at-the-market program during the reported week. It instead spent $176.3 million repurchasing STRC preferred shares and doubled its digital credit securities repurchase authorization to $2 billion.

Strive took another route. A Sep. 14 report on its latest Bitcoin purchase said the U.S.-listed company bought 469 BTC for about $36.6 million using proceeds from SATA preferred stock, bringing its holdings to 25,000 BTC as of Sep. 11. Its SEC filing gave investors both the purchase amount and the security used to fund it.

Operating income can change the comparison

The analysis says companies can also seek returns from staking, mining, or businesses outside their token reserves. Such income may increase resources available to shareholders without selling the principal crypto holding, although the result depends on operating costs and execution.

For Bit Digital, the analysis points to its cloud infrastructure business, White Fiber, as a reason its shares maintained a premium while the value of its digital assets fell. White Fiber accounted for more than 89% of Bit Digital’s second-quarter revenue, according to the earnings information cited in the analysis.

Ether treasury companies offer another example through staking. BitMine had more than 5.06 million ETH staked out of holdings approaching 5.98 million ETH, according to its Sep. 21 treasury update. Staking can earn additional ETH, but shareholders still own a company whose share price can move differently from Ether.

The analysis also cited SharpLink’s announced $200 million allocation to stETH and a $125 million onchain yield fund with Galaxy. For Zcash-focused CYPH, it pointed to a mining fleet that the company said received more than 18% of the network’s emissions. Each activity gives investors an operating decision to assess alongside the quantity of tokens held.

Access has changed as well. The analysis argues that treasury stocks once drew a premium partly because some institutions could buy listed shares more easily than crypto directly. With more regulated funds and custody options available, its authors expect investors to place more weight on operators, financing terms, and business income when valuing one treasury company against another.

Asian countries account for almost half of Adoption Index

Almost half of the top 20 nations in terms of grassroots crypto adoption are in the Asia Pacific region. According to Chainalysis’s newly released 2026 Global Crypto Adoption Index, Japan ranks at number 4, followed by South Korea (5), India (6), Thailand (8), China (12), Indonesia (14), Australia (15), Vietnam (18) and the Philippines (19), which totals nine countries out of 20 on the index.

A big growth area in the APAC region is cross border stablecoin transfers.

Tianwei Liu, co-founder and CEO of StraitsX, told Cointelegraph that in Asia, fragmented currencies and payment systems have created demand for stablecoin settlement. 

“That demand is also extending into everyday spending, with stablecoins sitting behind payment methods people already use,” Liu said.

Bitget confirms $351M security breach, suspends withdrawals

Crypto exchange Bitget has confirmed unauthorized transfers affecting approximately $351.6 million in assets and temporarily suspended withdrawals as it investigates.

The CEO of the Asia-focused exchange, Gracy Chen, said the breach was contained to a portion of the exchange’s hot and warm wallet layers, while its cold wallets remained secure.

Bitget said it has flagged addresses associated with the transfers and contacted law enforcement and onchain security firms. The amount affected falls within Bitget’s User Protection Fund, which currently holds more than $464 million. 

Source: Gracy Chen

Binance takes $100M stake in Circle under expanded USDC deal

Binance has invested $100 million in stablecoin issuer Circle as part of an expanded five-year agreement to promote USDC on the crypto exchange. Under the agreement, Circle will pay Binance a monthly incentive fee based on the amount of USDC held through Circle’s Modular Smart Contract Wallet infrastructure.

Binance also agreed to undertake additional activities promoting USDC on its platform.

AUSTRALIA

Australian 40-year economic outlook recognizes ‘AI revolution,’ omits crypto

Australia’s new 40-year economic outlook has identified artificial intelligence as one of five major transitions expected to have a profound effect on the economy, while leaving out any mention of crypto. 

Coinbase Australia country director John O’Loghlen told Cointelegraph the report was a missed opportunity. “While the report focuses heavily on artificial intelligence, it completely misses the financial infrastructure those agents will need,” he said.

In related news, OpenAI agents hacked the Australian government’s Medicare system, and the firm forgot to mention the incident until three months later when it fired an email to a public email address.

KOREA

Bank of Korea launches 24-hour won settlement pilot for foreign investors

The Bank of Korea (BOK) launched a pilot of its first 24-hour won settlement network, aimed at allowing foreign investors to settle won transactions outside South Korea’s normal banking hours.

On Monday, its international wire network started trial operations with four domestic lenders: KB Kookmin Bank, Woori Bank, Hana Bank and Shinhan Bank. Full operations are scheduled for January 2027, when participation is expected to expand to other institutions and foreign banks.

The network will operate 24 hours a day, excluding weekends and public holidays

Hana Bank taps Euroclear blockchain for $100M bond issuance: Report

South Korea’s Hana Bank has issued a five-year, $100 million digital bond using Euroclear’s blockchain-based platform. Using the technology for bond allocation and payment settlement reportedly shortened the process from three to five business days to the same day. 

Kakao Pay, KakaoBank to explore stablecoin opportunities with Fireblocks

South Korean financial companies Kakao Pay and KakaoBank have signed a memorandum of understanding (MoU) with crypto infrastructure provider Fireblocks to explore digital asset opportunities, including stablecoins. 

North Korean fake recruiters infect 30K devices, steal $10.7M in crypto

North Korean cyber group WaterPlum targeted developers with fake jobs at crypto, AI and NFT companies, infecting at least 30,000 devices across more than 100 countries.

HONG KONG

Animoca puts Currenc merger on ice, delaying its Nasdaq debut

Animoca Brands has suspended plans to take the company public through a reverse merger with Nasdaq-listed Currenc Group. Animoca is a Hong Kong-headquartered investment and gaming company whose portfolio includes The Sandbox, Moca Network and Open Campus.

Both parties mutually agreed on the decision after reviewing market conditions and the deal’s projected closing timelines. Animoca said the companies may resume discussions if conditions permit.

Hong Kong jails ex-banker over $1.6B false credit, cryptocurrency bribes

A former bank official in Hong Kong who falsely authenticated letters of credit for more than $1.6 billion was sentenced to four years in prison and ordered to make restitution of more than $470,000 he received in cryptocurrency bribes.

HKMA announces plans for on-chain settlement

The Hong Kong Monetary Authority (HKMA) is upgrading its main debt securities settlement system, the Central Moneymarkets Unit, to run on blockchain 24/7. The upgraded platform is designed to handle CBDCs, tokenized deposits and stablecoins.

Boyaa Interactive adds 152 Bitcoin, holds 4,468 BTC

Hong Kong-listed online gaming company Boyaa Interactive has bought another 152 Bitcoin to bring its total holdings to 4,468 BTC

SAUDI ARABIA/CHINA

Saudi Arabia exits China-backed mBridge CBDC project: FT

Saudi Arabia has withdrawn from mBridge, a China-backed cross-border digital currency project designed to enable direct transactions between central banks, according to the Financial Times.

SAMA, Saudi Arabia’s central bank, joined mBridge as a full participant in June 2024 and ended its participation after completing a proof of concept on May 13, 2025, FT reported, citing a statement from the central bank.

SINGAPORE

Singapore tops crypto wealth migration rankings for 4th year

Singapore ranked No. 1 for a fourth straight year on the Henley Crypto Adoption Index which assesses 36 countries based on which offers the best conditions for cryptocurrency investors to relocate and settle.

VIETNAM

56 crypto scammers arrested

Bilyonaryo reports that 56 alleged scammers working in crypto fraud ring that stole millions from Vietnamese investors have been arrested in Cambodia and Vietnam.

The Solana Foundation has appointed former Binance executive Rachel Conlan as chief strategy officer and Polygon Labs veteran Jamal Raees as general manager of payments as the network builds out its institutional and payment business after processing more than $5 trillion in stablecoin volume this year.

According to the Solana Foundation, Conlan will lead strategy covering institutional partnerships, ecosystem growth and efforts to bring more companies and users onto Solana, while Raees will work with payment firms and enterprises seeking to use the network as payment infrastructure.

Conlan spent three years at Binance, where she served as global chief marketing officer, after earlier senior roles at OKX, CAA Sports and Havas. Raees joins from Polygon Labs and previously worked at stablecoin infrastructure company Bridge and payments company Wyre.

The appointments put separate executives in charge of two areas where the foundation has spent much of 2026 building partnerships: institutional finance and payments.

“The Solana ecosystem is growing in both scale and ambition,” Solana Foundation President Lily Liu said.

Liu described the current period as the early stages of a “Token Supercycle,” a term the foundation uses for the long term migration of money, assets and ownership onto internet based infrastructure.

Solana has processed more than $5 trillion in stablecoin volume during 2026, according to figures provided by the foundation. Real world assets on the network have passed $4.5 billion, while tokenized equity supply has crossed $620 million.

Solana Foundation puts institutional adoption under Conlan

Conlan’s role will cover the foundation’s institutional strategy as more financial companies test or deploy products on Solana.

“What brought me to Solana was the ambition of the builders and how much it is already being put to use,” Conlan said.

She said her work would include building institutional relationships and helping businesses move “from interest to implementation.”

Her appointment comes after several institutional projects brought tokenized securities, funds and other financial assets onto the network.

Solana attracted roughly $348 million in net distributed real world asset flows over a 30 day period measured in early September, while the value of distributed RWAs on the network reached approximately $4.23 billion, crypto.news previously reported. The network hosted products from firms including BlackRock, Franklin Templeton, VanEck, Circle, Ondo Finance and WisdomTree.

Tokenized equities have become another part of that activity. Ondo Finance brought hundreds of tokenized U.S. stocks and exchange traded funds to Solana earlier this year, while other asset managers have used the network for tokenized Treasury and investment products.

Institutional adoption has expanded outside the U.S. as well. SBI Global Asset Management and DigiFT launched a tokenized Japanese equity fund on Solana in July. The SBI Japan High Dividend Equity Strategy Token gives eligible institutional and accredited investors blockchain based access to a Japanese high dividend equity strategy.

Payments become a dedicated Solana leadership role

Raees will focus on payment companies, enterprises and ecosystem participants building payment services around Solana.

“Payments are one of the clearest areas where blockchain infrastructure is moving from promise to production,” Raees said.

He pointed to Solana’s performance, reliability and developer ecosystem as areas that could support payment services at global scale.

The foundation has spent much of 2026 building infrastructure and partnerships around stablecoin settlement and payments.

In March, it launched a developer platform designed for financial institutions and enterprises working with stablecoins, tokenized assets and payment flows. Mastercard, Western Union and Worldpay joined as early users, with the platform covering use cases including stablecoin settlement, merchant payments and cross border transfers.

Issuance and payments modules were available at launch, while a trading module covering atomic swaps, vaults and onchain foreign exchange was planned for later in 2026. The foundation brought together more than 20 infrastructure providers across wallets, compliance, node infrastructure and payment ramps for the platform.

MoneyGram later became a Solana validator and joined the same institutional developer platform as part of its blockchain payments strategy. The payments company was already developing stablecoin based transfer services and operating validator infrastructure across several blockchain networks.

Payment trials have reached Asian markets as well. South Korean payment processor KSNet and the Solana Foundation began testing Solana Pay for merchant payments, with the companies planning to examine commercialization models after technical validation. Shinhan Card separately worked with the foundation on a stablecoin payment proof of concept using Solana’s testnet.

Solana expands institutional work in Japan

Japan has become another part of the foundation’s institutional strategy following a partnership with SBI Holdings announced in July.

Under the agreement, the Solana Foundation joined SBI R3 Japan alongside SBI Holdings and Sumitomo Mitsui Financial Group, with plans for the company to operate under the SBI Solana Global name following the required corporate process.

The SBI Solana partnership covers stablecoins, tokenized assets, cross border payments and institutional onchain services. Payment systems for AI agents were listed among the planned business areas, although the partners did not provide launch dates for individual products when the venture was announced.

SBI’s work with Solana soon expanded into tokenized securities. Its asset management arm launched the JX token with DigiFT, while SBI later partnered with Ondo Finance to bring tokenized Japanese stocks into its financial ecosystem and use its yen backed JPYSC stablecoin for settlement and collateral.

The foundation has pursued another payment model at the intersection of stablecoins and artificial intelligence.

In May, Solana Foundation and Google Cloud rolled out Pay.sh, a payment gateway that lets AI agents use stablecoins to pay for individual API requests. The system allows agents to access services including Gemini, BigQuery and Vertex AI through a Solana wallet without relying on a conventional subscription for each service.

Pay.sh was designed to support payments as small as fractions of a cent and uses an API proxy on Google Cloud, with the Solana wallet functioning as both a payment and identity layer. More than 50 community API providers were supported when the service was introduced.

Conlan and Raees join a foundation leadership team that has added other senior executives during 2026. Michael Coates became chief information security officer earlier this year after holding senior security roles at Mozilla and Twitter, according to the foundation.

In an interview with crypto.news, Selva Ozelli speaks with CKC Fund founder and managing director David Doss about institutional digital asset investing, risk management and the infrastructure needed to connect crypto strategies with professional investors.

The discussion also covers Bitcoin and Ethereum, AI and blockchain intellectual property, data centers, stablecoin regulation under the GENIUS Act, the CLARITY Act and tokenization, as well as Doss’ outlook for the digital asset market through the rest of 2026.

David Doss is a digital asset fund manager, growth advisor, and marketing executive who serves as the founder and managing director of CKC Fund (CKC Management LLC). His work centers heavily on digital asset wealth management, blockchain infrastructure, compliance, and institutional risk standards. He sits on the board of ChainBLX (fostering corporate fintech events like Digital Davos) and authored the investor guide Digital Assets Decoded.

1. Tell us about your journey to founding CKC Fund.

My career has two chapters: a decade in research, education, and technology, followed by a decade in digital assets.

I started in academic research in 2005, including a Fulbright graduate research scholarship, before moving into education technology and growth leadership. That experience taught me to follow the evidence and build the operational scaffolding that turns good ideas into real businesses.

In digital assets, I kept seeing the same gap: strong traders on one side and serious investors on the other, without enough institutional infrastructure connecting them.

CKC exists to close that gap: not through better predictions, but through better architecture. We built around segregated portfolios, non-custodial execution, auditable NAV, and clear separation between the manager and investor assets. The structure came first, then the strategies. I’m convinced that’s the right order.

2. How did you get interested in digital assets?

I was drawn to the technology before the price. A financial ledger that anyone could independently verify represented a major shift from traditional systems built around trusted intermediaries.

I became interested in 2016. Today, that original promise is becoming practical through stablecoin payments, tokenized assets, and on-chain proof of holdings.

3. Tell us about the investment strategy and philosophy of CKC Fund.

In a market this volatile, the durable edge is risk management — not prediction.

We separate market exposure, momentum, yield strategies, and longer-term private investments rather than blending them into one portfolio. Each has a different risk profile.

Custody is equally important. Our traders can execute strategies without being able to withdraw investor assets. We also size positions for the drawdowns we can withstand, not the returns we hope to make.

My background in internationally competitive épée fencing taught me something similar: winning is less about moving fastest than controlling distance and choosing the right moment.

4. How much do you have in assets under management?

We don’t publicly disclose current fund-level AUM, but over my career, I’ve consulted on or managed more than $100 million across digital asset strategy, growth, and fund operations.

5. Which digital assets do you invest in?

We focus primarily on Bitcoin, Ethereum, and a small group of highly liquid digital assets.

Liquidity comes first. We need to know we can exit a position in a stressed market without moving the market ourselves. We also look for a real economic purpose and enough derivatives-market depth to manage risk. If we can’t explain the asset or model the exit, we don’t invest.

6. Are you investing in AI and blockchain intellectual-property ventures?

Yes, selectively. We’re interested in defensible intellectual property in AI-enabled media, including patents and equity in the companies developing them.

Those investments sit in a dedicated vehicle, ART SP, rather than being mixed with liquid digital assets. The risks and timelines are completely different.

As AI models become cheaper and more widely available, lasting value will increasingly come from proprietary data, distribution, and enforceable intellectual property.

7. How about data centers, orbital data centers, and platform technologies?

They’re promising, but they’re at very different stages.

Traditional data centers are investable now. AI’s constraints increasingly involve power, grid access, and physical capacity, not just chips.

Orbital data centers are much earlier-stage. The potential is real, but so are the engineering risks and dependence on launch costs. I view them as frontier venture investments, not predictable infrastructure assets.

Platform technologies may offer the most capital-efficient opportunity. Software that manages, verifies, and transacts around computing resources can scale without owning the entire physical layer.

8. Has the enactment of the GENIUS Act made investing in stablecoins easier?

It has made stablecoins easier to use by clarifying standards around reserves, audits, and redemptions. That gives banks and institutions greater confidence.

It has also made the business model more competitive. Because issuers cannot pay interest directly, more value is shifting toward exchanges, wallets, and distribution platforms.

The next major issue is stablecoin rewards. Banks see them as competition for deposits; crypto platforms see them as a way to share value with users.

9. What are your thoughts on the impact of the CLARITY Act cloture vote failing?  Will this slow down tokenization?

The CLARITY Act could give digital assets a clearer path from securities treatment to commodity treatment as their networks become more decentralized. The industry needs rules it can follow in advance, rather than discovering the boundaries through enforcement.

If the Act fails, tokenization won’t stop. More activity will simply move offshore or remain inside private markets.

The United States risks losing market share, jobs, and influence … and ordinary investors may have less access to the benefits.

10. Digital assets are showing a late-year price recovery in 2026. What are your market predictions for the rest of 2026?

I don’t give short-term price targets. I focus on the conditions driving the market.

The 2026 decline looked more like an orderly reduction in leverage than a breakdown of the system. Exchanges kept operating, stablecoin infrastructure held up, and no major intermediary failed. That’s meaningful progress.

For the rest of the year, I’m watching global liquidity, how quickly leverage returns, and whether Bitcoin can break through recent resistance. A gradual recovery would be healthier than another fast, heavily leveraged rally.

11. Anything else you would like to add?

Investors should ask every manager a simple question: “Who verified the numbers, and when?” A return, valuation, or track record is only as reliable as the process behind it. The industry has made enormous progress on infrastructure. It now needs the same discipline in reporting and transparency.

12. How can people reach you?

Email: [email protected]

Web: 

LinkedIn: linkedin.com/in/davidambrosedoss

X: @DDossAttack

I’m always glad to hear from journalists, researchers, investors, founders, and others working in digital assets, AI, and market infrastructure.

About the Author:
Selva Ozelli Esq, CPA, is an international digital asset legal expert and author of Sustainably Investing in Digital Assets Globally and an award winning artist.  Her writings are translated into 45 languages and republished in over 200 global publications.  She is recognized as an expert media/TV commentator on global AI,  digital asset regulation, tax, and technology matters.

New York Attorney General Letitia James has sued Polymarket, alleging that the prediction market operated without a state gambling license and allowed people under 21 to use its platform.

According to a petition filed by New York Attorney General Letitia James in a Manhattan state court on Sep. 24, Polymarket offered New Yorkers contracts tied to the outcomes of future events without obtaining a license from the New York State Gaming Commission.

The state is asking the court to stop the alleged unlicensed operation, order restitution for customers, impose civil fines, and require Polymarket to give up gains it says were earned illegally.

The filing puts the company in the same state legal fight as Kalshi, Coinbase Financial Markets and Gemini Titan. James brought a case against Kalshi in July, after filing petitions against Coinbase and Gemini in April. Each case centers on New York’s claim that the companies offered gambling products without the licenses required under state law.

Polymarket’s sports contracts draw New York’s challenge

New York’s petition cites contracts tied to sports outcomes, including a July baseball game between the Los Angeles Dodgers and New York Mets. In the state’s view, customers risk money on events they cannot control in exchange for a payout if their chosen outcome occurs. James describes the products as gambling, a legal claim Polymarket can contest in court.

State officials also object to Polymarket allowing users aged 18 to 20 onto the platform. New York sets a minimum age of 21 for mobile sports betting, and the attorney general argues that operating outside the state’s licensing system leaves customers without the safeguards required of approved betting companies.

Governor Kathy Hochul said the alleged operation had put New Yorkers at risk, particularly younger users whom she described as more vulnerable to problem gambling. James likewise argues in the petition that unlicensed contracts expose residents to gambling addiction without the protections imposed on state-regulated operators. Polymarket expressed disappointment with the lawsuit and said it would speak with the state, Reuters reported.

In July, New York sued Kalshi over prediction markets, alleging that its event contracts amounted to unlicensed gambling. The state’s case against Kalshi also raised the age of users and the absence of state approval. Kalshi has argued that its federal registration places its contracts under Commodity Futures Trading Commission oversight.

A separate inquiry has focused on how the products are sold to customers. In August, the New York City Council examined prediction market advertising by Polymarket, Kalshi, Coinbase and Gemini Titan. Council Speaker Julie Menin’s office said the inquiry concerned allegations of deceptive marketing and planned to consider whether consumer protection measures were needed. The city inquiry is separate from James’s state gambling cases.

CFTC jurisdiction remains contested in the US

At the center of the court disputes is whether federal oversight of event contracts prevents states from applying their gambling laws to sports-related markets. Prediction market operators have argued in litigation that contracts traded on federally regulated exchanges fall under the Commodity Exchange Act and the CFTC’s authority. State officials say a federal derivatives framework does not remove their power to license and regulate sports wagering within their borders.

James set out New York’s position in April when she joined 37 other attorneys general in a filing supporting Massachusetts’s case against Kalshi. The coalition argued that Congress did not give the CFTC exclusive control over sports gambling when it expanded federal regulation of swaps through the Dodd-Frank Act. The attorneys general also said state rules address matters such as minimum betting ages and protections for people at risk of gambling harm.

The distinction matters to US users because access to a sports contract can depend on the state where a customer lives and on court orders governing a particular operator. In Michigan, for example, a state court ordered Kalshi to keep sports event contracts blocked for residents while that lawsuit proceeds. The preliminary injunction carries potential fines of $500,000 per day for violations of its terms, as covered in September. That order concerns Kalshi; it does not decide New York’s claims against Polymarket.

Federal appeals courts have also reached different preliminary conclusions in Kalshi’s cases. In April, the Third Circuit upheld an order preventing New Jersey from enforcing its gambling rules against Kalshi’s sports contracts while the litigation continues. The court found Kalshi likely to succeed on its argument that the contracts qualify as swaps subject to the CFTC’s exclusive jurisdiction.

In August, the Ninth Circuit allowed Nevada gaming regulators to proceed against Kalshi’s sports contracts. Its ruling found Kalshi unlikely to succeed on the claim that federal commodities law displaced Nevada’s requirements. Neither preliminary ruling is a final decision resolving every claim in the underlying cases.

New Jersey has asked the Supreme Court to review the split

Following its Third Circuit loss, New Jersey petitioned the Supreme Court on Sep. 2 to review whether federal law prevents states from applying sports gambling rules to contracts offered on a CFTC-registered market. The state argues that Congress did not remove its authority over sports wagering by defining and regulating swaps.

New Jersey’s petition asks the justices to review the Third Circuit decision in the Kalshi case. Filing the petition does not mean the Supreme Court has agreed to hear it; the justices must first decide whether to grant review.

The Federal Reserve has published two proposals aimed at putting more detailed guardrails around stablecoin issuers as the U.S. implements the GENIUS Act. The plan, developed for entities under Fed supervision, would add capital requirements, define operational-risk charges, tighten redemption expectations, and mandate standardized reserve reporting—while also outlining an approval path for certain banks to issue payment stablecoins through subsidiaries.

At the same time, Fed Governor Michael Barr signaled support for the overall direction but emphasized that stablecoins must remain reliably redeemable at par even under market stress. His remarks point to the central test investors and users will apply to the final rules: will redemption work smoothly when liquidity tightens and even high-quality government debt trades under strain?

Key takeaways

• The Fed’s proposal adds an operational-risk capital framework for Fed-supervised stablecoin issuers, with charges that vary based on the amount of stablecoins outstanding.
• Redemptions would generally need to be processed within two business days, and issuers would face defined steps if reserves fall below the one-to-one backing requirement.
• Issuers would be required to publish monthly reserve and outstanding stablecoin disclosures, certified by senior executives and audited by a registered public accounting firm.
• A separate proposal would set an application process for Fed-supervised banks to seek approval to issue payment stablecoins through subsidiaries.
• Barr backed the direction of the framework but urged additional clarity on how stability is ensured during stress, including interest-rate and foreign-currency risks.

How the GENIUS Act shapes the Fed’s stablecoin rulemaking

The GENIUS Act already contains baseline requirements for stablecoin issuers: tokens must be backed by reserves on a one-to-one basis, and issuers are limited in the types of assets they can hold. In particular, the statute restricts reserves to certain categories including cash, bank deposits, and short-term U.S. Treasurys, while leaving regulators to build out more granular capital, diversification, and risk-management standards.

According to the Fed’s proposal, the missing piece is the operational and supervisory detail: how much capital issuers must hold against specific risks, what redemption timelines must be met, and how often issuers must document and verify that reserves remain adequate.

Capital charges, redemption timelines, and what happens if backing slips

Under the Fed proposal, issuers would face an operational-risk capital charge calculated as a percentage of the stablecoins they have issued. The rate would step down as outstanding amounts increase: 2% for the first $20 billion of stablecoins outstanding, 1.5% for the next $30 billion, and 1% for amounts above $50 billion. The proposal also references additional capital requirements tied to credit and operational risks.

The rules would also establish a practical expectation for redemption operations. In general, Fed-supervised issuers would be expected to process redemptions within two business days.

Importantly, the proposal addresses a key failure scenario: if an issuer’s reserves fall below the required one-to-one backing, it would have to notify the Fed and choose between two paths—either restore reserves according to a remediation plan or liquidate reserves and redeem outstanding stablecoins.

For investors and market participants, this structure matters because it translates a statutory “always backed” principle into an operational consequence framework. Instead of only requiring reserve sufficiency after the fact, the proposal attempts to specify how quickly an issuer must act and what supervisory information will be available.

Monthly transparency with audited reporting

To reinforce the reserve-backstopping requirement, the Fed proposal would require issuers to publish monthly reports. These disclosures would cover the outstanding amount of stablecoins and the value and composition of reserves.

The proposal also sets a higher standard for accountability around that data: the disclosures would need to be examined by a registered public accounting firm and certified by the issuer’s CEO and CFO.

That combination—frequent reporting, third-party review, and executive certification—can be significant for traders, partners, and users trying to assess whether a stablecoin remains compliant as market conditions evolve. It also increases the importance of internal controls at issuers, since executive sign-off implies direct responsibility for the quality and accuracy of reserve information.

Separate track for Fed-supervised banks issuing through subsidiaries

Alongside issuer-focused requirements, the Fed released a separate proposal that would establish an application process for Fed-supervised banks seeking approval to issue payment stablecoins through subsidiaries.

Per the proposal, banks would need to submit a business plan and provide financial information as part of the approval process. While the GENIUS Act sets the statutory groundwork, this track would determine whether banks—under Fed supervision—can bring certain stablecoin issuance activities under a subsidiary structure and how they would be evaluated before launch.

For the broader industry, the distinction matters: approval frameworks can affect timing, product design, and risk management choices for banks looking to participate in stablecoin markets.

Barr stresses redemption reliability under stress and highlights open questions

In remarks accompanying the proposals, Fed Governor Michael Barr supported the overall direction but argued that more work is needed before stablecoins can qualify as reliable payment instruments. In a statement released Thursday, Barr said stablecoins will only be stable if they can be “reliably and promptly redeemed at par in a range of conditions,” explicitly including periods of market stress.

Barr’s commentary focused on scenarios where liquidity strains can affect even otherwise liquid government debt, as well as episodes where an issuer—or related entities—faces pressure. He said he was encouraged by the proposed limits on reserve assets and the standardized capital requirements, but he also called for public feedback on whether the framework adequately addresses interest-rate and foreign-currency risks.

Barr also raised process-and-enforcement considerations. He said universal redemption rights should be clearly established in the final rule. He further expressed concern about a proposed standard that would limit the Fed’s ability to take supervisory or enforcement action over an anti-money laundering deficiency unless the issue is deemed “significant or systemic.”

These points suggest that while the Fed is moving to operationalize the GENIUS Act, the “stress test” details—particularly around interest-rate, FX, redemption rights, and supervisory triggers—may still evolve through the comment period.

What happens next

The Fed’s proposals are open for public comment for 60 days after publication in the Federal Register. With the GENIUS Act scheduled to take effect on Jan. 18, 2027, or 120 days after final implementing rules are issued—whichever comes first—the key question for market participants is how the final rule will address Barr’s concerns and refine redemption reliability, capital adequacy, and stress-related risks.

Paxos Labs has launched PAXGy, a token built on PAX Gold that is designed to increase the amount of PAXG a holder can redeem as its reserves earn returns from gold leasing.

According to Paxos Labs’ launch announcement shared with crypto.news, the company deploys the reserves behind PAXGy to vetted institutional gold borrowers. As the borrowers pay to lease the metal, the company says the value of each PAXGy rises in PAXG terms. Holders can redeem PAXGy for PAXG, although the amount returned depends on the exchange rate at the time.

The structure gives holders a way to seek returns measured in ounces of gold rather than dollars. It also makes PAXGy different from simply holding PAXG: the return depends on the performance of a lending strategy, while the dollar value of both tokens remains exposed to changes in the gold price, Paxos Labs said.

How PAXGy turns gold leasing into token returns

Paxos Labs said a holder can enter the product by depositing PAXG or swapping an accepted stablecoin. Instead of distributing additional tokens to the wallet, income from the reserve assets is designed to increase the amount of PAXG redeemable for each PAXGy.

The reserves are placed with institutional borrowers in the bullion leasing market, according to the announcement. Refiners, jewelry makers, miners and bullion banks may borrow gold for their operations and pay a lease rate in gold terms. Paxos Labs said the market has long relied on large transactions and direct relationships with banks, limiting access for smaller holders.

“Gold has been lent for thousands of years, and institutions have earned on their bullion reserves for decades,” Paxos Labs co-founder Bhau Kotecha said in the announcement. He said PAXGy is intended to give token holders access to those economics, with the reserves growing in ounce terms when the strategy earns a return.

The distinction between the two tokens matters for anyone entering or leaving the product. Under Paxos’ PAXG terms, each PAXG represents one fine troy ounce of London Good Delivery gold held on a segregated basis for holders. PAXGy, by contrast, is built on PAXG and uses reserves in an external lending strategy, as described by Paxos Labs.

For direct redemptions through the Paxos platform, the PAXG terms require a verified account. They also set a minimum of 430 PAXG, plus a fee, for redemption into an allocated London Good Delivery bar. Those conditions concern the underlying PAXG product; Paxos Labs describes the exit from PAXGy as redemption into PAXG.

Where PAXGy is available at launch

Paxos Labs named OKX as PAXGy’s only centralized exchange listing at launch and said the token is available through OKX Gold Earn and X Layer. It also named 0x, Uniswap and Ether.Fi among its onchain launch partners. Additional venues are expected to follow, the company said.

For transfers between blockchains, Paxos Labs selected Chainlink’s Cross-Chain Interoperability Protocol as its exclusive messaging provider. The company said holders can move a PAXGy position across supported chains without first redeeming it for PAXG. Availability through a particular exchange or service may still depend on that provider’s terms and the holder’s location.

The launch comes as tokenized gold is being used for more than spot trading. In August, Arch Lending began accepting PAXG and Tether Gold as collateral for loans, according to an earlier crypto.news report. Arch’s service lets eligible holders borrow against their tokens; PAXGy instead seeks a return by placing reserve assets with gold borrowers.

Trading activity has also increased. A report on tokenized gold volume in May cited CoinGecko data showing $90.7 billion in first-quarter 2026 spot volume, above the $84.64 billion recorded throughout 2025. CoinGecko identified PAXG and Tether Gold as the main contributors to that market’s trading activity.

What U.S. holders need to know about the risks

Paxos Labs’ product notice says PAXGy carries credit, liquidity, and market risks. Returns are not guaranteed: losses in the external strategies or a borrower default could cause the PAXGy-to-PAXG exchange rate to fall, leaving a holder with less gold exposure than the amount deposited. A rise in the exchange rate would likewise not guarantee a dollar profit if the price of gold fell.

For U.S. holders considering the underlying asset, Paxos’ PAXG terms spell out a separate set of redemption conditions. Only verified customers can purchase PAXG from Paxos or convert and redeem it directly through its platform, and the company says it may refuse a transaction in circumstances described in those terms. PAXGy’s launch announcement does not state that holding the new token changes those direct PAXG redemption requirements.

Paxos Labs said tokenizing gold allows smaller holdings to be pooled into positions large enough for institutional leasing. Chief executive and co-founder Charles Cascarilla described PAXGy as a way to put tokenized gold to work after it has been made transferable onchain. The company’s notice says any resulting growth still depends on the reserve strategy, and its exchange rate may be adjusted downward if that strategy incurs losses.