“In a space that is just completely flooded with bulls**t and with fakers and self-promoters, I think that has actually been a superpower.”

Crypto venture capital firm Dragonfly Capital has closed its fourth fund at $650 million.

The fund comes as the broader cryptocurrency market faces a severe downturn, with token prices declining and investor enthusiasm weakened.

$650 Million Fund

Dragonfly’s previous fund, its third, deployed $500 million into startups such as Polymarket, Rain, and Ethena. The new $650 million vehicle aims to continue that trajectory and will provide capital for the firm to pursue early-stage investments at a time when the crypto venture sector is experiencing a slowdown as deal activity declines and firms face challenges in raising additional capital from investors, according to Fortune.

Speaking about the latest development, co-founder Haseeb Qureshi commented,

“We talk out loud and we say what we think. In a space that is just completely flooded with bulls**t and with fakers and self-promoters, I think that has actually been a superpower.”

The firm’s investments have included Layer 1 blockchain projects such as Avalanche, financial services firms like Amber Group, and other crypto projects. Besides, Dragonfly’s operations have continued through multiple market disruptions, such as the collapse of the Terra Luna ecosystem, the FTX bankruptcy, and a move away from China amid a local crypto crackdown.

Scrutiny Linked to Tornado Cash Investment

It has also faced regulatory scrutiny from the Department of Justice (DOJ). In July 2025, prosecutors informed a federal judge that they were considering criminal charges against employees of the crypto venture firm, including general partner Tom Schmidt, in relation to the 2020 investment in Tornado Cash.

The statement was made by prosecutor Nathan Rehn to District Judge Katherine Polk Failla of the Southern District of New York during a break in the trial of Tornado Cash developer Roman Storm, who was later convicted of operating an unlicensed money transmission. Dragonfly co-founder Haseeb Qureshi clarified that the firm has fully cooperated with the government investigation, which began in 2023. He had then stated that if charges are filed, they intend to defend themselves.

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The Justice Department later backtracked, and no charges were filed against Schmidt.

Global tariff policy dominated the weekend news cycle as the United States further expanded a tariff strategy that has rattled risk assets, including crypto markets. In a late-Friday move, a 10% global tariff was announced, layered atop existing duties. On Saturday, President Donald Trump signaled an immediate increase to 15% and intensified his critique of the Supreme Court’s ruling that he believed restricted his power under the International Emergency Economic Powers Act (IEEPA). The constitutional and statutory questions remain contested, with critics arguing the scope and duration of such tariffs can be constrained by courts and Congress. Against this backdrop, traders watched how policy risk would filter through liquidity, leverage, and investor sentiment across traditional and digital markets, even as some crypto assets showed notable resilience amid the headlines.

Key takeaways

• The president raised the global tariff from 10% to 15% with immediate effect, expanding a policy stance that officials described as a corrective measure against perceived imbalances.
• The legal basis for broad tariffs remains under dispute, with proponents pointing to the Trade Expansion Act of 1962 and the Trade Act of 1974, while critics highlight limits identified by the Supreme Court and calls for congressional oversight.
• Crypto markets showed relative composure despite the tariff news: Bitcoin traded near $68,000 and Ethereum remained broadly unchanged, even as the broader market indicator Total3 slid less than 1% to around $713 billion.
• Analysts highlighted that the legal mechanism cited by the administration could constrain the duration and scope of tariffs, particularly for deficits with specific countries, a point underscored by a prominent crypto attorney.
• Historically, tariff announcements have stirred volatility in crypto and equities, but this episode illustrated a degree of resilience in the sector as policy uncertainty persisted.

Tickers mentioned: $BTC, $ETH

Sentiment: Neutral

Price impact: Neutral. Crypto assets showed limited immediate reaction, with BTC hovering around the prior level and ETH largely stable.

Trading idea (Not Financial Advice): Hold. In the absence of a clear macro-trigger for a sustained move, maintaining existing exposure and watching policy developments is prudent.

Market context: The tariff news appeared to translate into modest shifts within the crypto complex, with BTC and ETH holding their ground while the broader market cap (as measured by TOTAL3) softened only slightly, suggesting a measured risk stance among traders amid regulatory maneuvering.

Why it matters

The episode underscores the sensitivity of crypto assets to macro and regulatory developments, even when specific policy actions are framed as targeted or temporary. While the immediate tariff step and the surrounding legal debates may appear distant from on-chain activity, macro risk sentiment often travels through asset classes in tandem. The resilience observed in major digital assets during the latest headlines points to a broader trend: liquidity and risk appetite in crypto can persist even amid policy shocks, at least in the near term.

From a policy perspective, the episode highlights the complex interplay between executive authority, judicial interpretation, and congressional checks. The administration’s reliance on IEEPA and related statutes has long been a point of contention among legal scholars and market participants alike. Crypto advocates and lawyers have argued that the scope of such powers is inherently limited and time-bound, which can mitigate longer-term distortions in markets. The discussion around duration—cited as potentially 150 days or a finite window—appears to be a critical variable for traders monitoring macro risk in the coming months.

For investors, the news reinforces the importance of differentiating policy risk from sector fundamentals. While tariffs can trigger short-lived liquidity hits, many crypto participants emphasize that network fundamentals, adoption pace, and institutional interest remain drivers of longer-term price trajectories. The incident also brings attention to the role of public commentary and official communications in shaping risk premiums, as market participants parse statements from presidents, lawmakers, and legal commentators for clues about future policy steps.

What to watch next

• Monitoring any additional tariff announcements or amendments to the policy framework, including statements from the White House and Congress.
• Watch for updates on the legal interpretation of IEEPA authority and potential judicial checks that could constrain the administration’s tariff powers.
• Track market liquidity and risk sentiment across crypto and traditional markets as traders digest policy signals and macro data releases.
• Follow commentary from legal scholars and industry attorneys about the duration and geographic scope of tariffs, and whether carve-outs or exemptions emerge.
• Observe on-chain indicators and exchange flows that may reveal subtle shifts in demand for flagship assets like Bitcoin and Ether as policy risk evolves.

Sources & verification

• Official statements and post-announcements from the Trump administration regarding the 15% tariff level and the rationale behind the move.
• Legal analysis and public commentary on IEEPA authority, including references to the Supreme Court decision that framed the scope of presidential tariff power.
• Crypto market data and price movements for Bitcoin and Ethereum around the tariff headlines, including price levels cited (BTC near $68,000; ETH broadly unchanged) and the TOTAL3 market-cap indicator around $713 billion.
• Public remarks from Adam Cochran on the limits of the tariff powers and the 150-day window for any measures under the cited statutes.
• Trade and market coverage documenting the relationship between tariff announcements and moves in crypto and traditional asset classes.

Tariff escalation tests crypto risk appetite

In a move that intensified an ongoing policy debate, President Donald Trump announced on Saturday that the 10% global tariff would be raised to 15% with immediate effect. The action extended a tariff framework that had already unsettled markets when new levies were proposed and when the courts weighed in on the administration’s authority. The president framed the increase as a legally tested step, asserting that it targets deficits with various countries and would be calibrated within the boundaries of the law. In a Saturday Truth Social post, he declared that he would be “effective immediately, raising the 10% worldwide tariff on countries, many of which have been ‘ripping’ the US off for decades, without retribution, until I came along, to the fully allowed, and legally tested, 15% level.”

“As President of the United States of America, I will be, effective immediately, raising the 10% worldwide tariff on countries, many of which have been ‘ripping’ the US off for decades, without retribution, until I came along, to the fully allowed, and legally tested, 15% level.”

Earlier on Friday, the administration had signaled a 10% global tariff as a base level, to be added to pre-existing duties, and had invoked legal measures under the Trade Expansion Act of 1962 and the Trade Act of 1974. The move followed a ruling from the Supreme Court that some argued curtailed presidential authority under IEEPA, complicating the administration’s ability to enact sweeping levies without further legislative action. Crypto enthusiasts and industry observers noted that the legal framing matters because it could limit the duration and reach of the tariffs, particularly for deficits with specific partners. Pro-crypto attorney Adam Cochran highlighted the practical constraints, noting that the law in question applies to a defined set of countries for a finite period and at a capped rate, reducing the likelihood of unfettered, long-term application.

Markets often respond to tariff developments with a tilt toward risk-off behavior, and the immediate reaction can be pronounced in sectors sensitive to global liquidity, leverage, and cross-border trade dynamics. Yet in this cycle, the crypto space demonstrated relative steadiness in the face of the tariff news. Bitcoin (CRYPTO: BTC) price movements remained largely tethered to prior levels, while Ethereum (CRYPTO: ETH) exhibited similar resilience. Data from market trackers showed BTC near the $68,000 mark and ETH holding broadly steady, with the Total3 indicator—representing the combined market capitalization of crypto assets excluding BTC and ETH—falling less than 1% to roughly $713 billion, suggesting that investors differentiated policy risk from fundamental demand for large-cap digital assets.

The narrative around policy power and market impact is ongoing. The tariff announcements have sparked discussions among lawmakers about potential economic consequences, and observers will be watching for signals about the trajectory of regulatory policy, potential exemptions, and the duration of any temporary measures. In the meantime, traders are parsing the implications for risk sentiment, liquidity, and cross-asset correlations as the policy landscape continues to evolve. The interplay between legal interpretation and executive action will likely shape the near-term volatility spectrum for crypto and traditional markets alike.

Japanese financial conglomerate SBI Holdings is aggressively deepening its integration with the XRP ecosystem through calculated new moves.

These strategic initiatives aim to drive both retail crypto onboarding and corporate developer adoption.

SBI Offers $64 Million Bond With XRP Rewards

On February 20, SBI revealed a 10 billion yen ($64.5 million) blockchain-based security token bond offering that rewards retail investors with XRP.

The three-year debt instrument, branded as SBI START Bonds, officially prices on March 10 and issues on March 24. It promises conventional fixed-income investors an indicative annual interest rate between 1.85% and 2.45%.

“The SBI Group believes that the continued development of the ST bond market in Japan will contribute to the revitalization of the capital markets and, ultimately, to the sustainable growth of the real economy,” it stated.

However, the XRP rewards serve a much deeper purpose than simple yield enhancement.

To qualify for the cryptocurrency payouts, which are distributed annually through 2029, domestic investors must open and verify an account with SBI VC Trade, the firm’s cryptocurrency brokerage subsidiary, by May 11.

By mandating this crucial step, SBI implements a highly efficient customer-acquisition strategy.

The firm uses a safe, regulated, yen-denominated corporate bond to funnel conservative retail money into its digital asset platform. Once these users enter the ecosystem, SBI can aggressively cross-sell them spot trading, staking, and margin services.

SBI to Support XRPL-Focused Startups Through New Partnership

Simultaneously, SBI Ripple Asia signed a memorandum of understanding with the Asia Web3 Alliance Japan (AWAJ).

The partners aim to establish a specialized venture studio model that provides hands-on technical and regulatory support to regional startups.

“In this initiative, the two companies will work together to provide technical support as ‘technical support partners’ to businesses aiming to implement financial services using blockchain,” the firms stated.

Crucially, the initiative expressly requires these startups to build their financial services natively on the XRP Ledger (XRPL).

Unlike rival networks such as Ethereum or Solana, which boast organic developer momentum and robust smart contract activity, XRPL lacks a thriving decentralized finance ecosystem.

However, the blockchain network has recently introduced several new features designed to attract institutional interest.

By funding a venture studio explicitly tied to the ledger, SBI essentially attempts to further fuel developer momentum on the blockchain network.

The firm recognizes that without startups actively building on the chain, the network will remain underutilized for complex financial applications.

“Through our collaboration, we will support the creation of practical use cases utilizing XRPL that contribute to the financial and industrial sectors, aiming to realize globally applicable financial use cases originating in Japan,” they explained.

TLDR:

• Algorand warns that smart contract vulnerabilities cause immediate, irreversible fund loss with no legal recovery path available. 
• AI tools may store user data in LocalState, a flawed pattern where ClearState drains critical accounting data permanently. 
• Algorand recommends using Plan Mode and agent skills to design secure contract architecture before writing a single line of code. 
• Private keys must stay out of AI reach entirely, with OS-level keyrings handling all transaction signing away from the agent.

Algorand is urging blockchain developers to adopt disciplined, AI-assisted practices before deploying smart contracts to MainNet.

The blockchain platform has drawn a clear line between reckless AI-generated code and responsible agentic engineering.

With AI agents now capable of building and deploying contracts in a single conversation, the stakes have never been higher. Deploying vulnerable smart contracts means immediate, irreversible loss of funds with no path to recovery.

The Risk of Unreviewed AI-Generated Code

Algorand developers have identified a growing problem in the broader web3 space. AI coding tools allow developers to ship products faster, but unchecked code carries serious risk.

Unlike web2 breaches, smart contract vulnerabilities cannot be patched after the fact. Funds drained from a poorly written contract are gone permanently, with no legal recourse available.

The Algorand team shared a concrete example of how AI can mislead developers. An AI might store user balances in LocalState, which appears to be the correct pattern.

However, users can clear local state at any time, and ClearState succeeds even when a program rejects it. This means critical accounting data can disappear without warning. Developers who do not understand the code they ship are exposed to exactly this kind of subtle failure.

Algorand’s developers formalized this concern through a public post from the @algodevs account. The post draws from Addy Osmani’s distinction between “vibe coding” and “agentic engineering.”

Vibe coding means accepting all AI output without review. Agentic engineering means the developer remains the architect and final decision-maker throughout the process.

The platform advises developers to use BoxMap instead of LocalState for data that cannot be lost. This kind of nuance is what separates a working contract from a broken one.

AI tools trained on outdated patterns will not flag these issues automatically. Developers must bring their own understanding to every deployment.

How Algorand Recommends Building Safely With AI

Algorand outlines several practices to keep AI-assisted development secure and maintainable. Developers should use Plan Mode before writing any code, allowing the agent to design architecture first.

This produces a spec covering state schema, method signatures, and access control. Reviewing this plan catches design flaws before any implementation begins.

Agent skills play a major role in guiding AI toward correct Algorand patterns. These are curated instructions that encode current best practices directly into the development workflow.

Without them, AI is likely to use deprecated APIs or outdated patterns. Structured prompts reduce hallucinations and produce more reliable contract code.

Private keys must remain completely out of reach of AI agents at all times. Tools like VibeKit use OS-level keyrings so that AI requests transactions without ever accessing signing credentials.

Additionally, developers should use algokit task analyze and simulate calls to catch edge cases. Testing should mirror how an attacker would approach the contract, not just how a user would.