Hi readers,

Welcome to our institutional newsletter, Crypto Long & Short. This week:

• Gregory Mall on how ETFs have shifted a growing share of bitcoin volatility into U.S. equity options markets
• Top headlines institutions should pay attention to by Francisco Rodrigues
• Mid-caps show surprising strength in Chart of the Week

Thanks for joining us!

-Alexandra Levis

Expert Insights

When ETF options start driving bitcoin

– By Gregory Mall, chief investment officer, Lionsoul Global

The launch of U.S. spot bitcoin ETFs marked a structural turning point. The iShares Bitcoin Trust ETF (IBIT) rapidly became one of the fastest-growing ETFs in history, drawing tens of billions into a regulated vehicle. Less discussed, but equally important, is what followed: the rapid expansion of IBIT options.

Over the past year, open interest in IBIT options has climbed into the multi-billion-dollar range. On selected high-volume sessions, activity has approached levels historically associated with Deribit, the cryptocurrency futures and options exchange. A meaningful share of bitcoin’s convexity now sits inside U.S. equity options markets rather than offshore crypto venues.

That shift matters because it changes how volatility is transmitted.

From offshore leverage to onshore gamma

For most of its history, bitcoin BTC$65,121.75 volatility was driven by offshore perpetual futures. Funding imbalances, leverage build-ups and liquidation cascades shaped price action.

ETF options introduce a different mechanism.

When investors buy calls or puts on IBIT, dealers typically sell that optionality and hedge delta exposure. If dealers are short gamma, which is common when investors are net long options, they must buy as price rises and sell as price falls. These hedging flows are inherently procyclical and can amplify underlying moves.

Because IBIT holds physical bitcoin, hedging does not remain confined to the wrapper. Arbitrage and creation and redemption flows transmit ETF positioning into the underlying market. Bitcoin increasingly participates in the same positioning mechanics that influence equity indices.

The structure of ETF options markets, where investors are generally net long optionality, suggests dealers are often warehousing short gamma during periods of elevated demand. This dynamic likely intensified during the February episode, when volatility had been subdued and crypto-native participants accumulated downside puts. Sustained option buying in a low-volatility regime leaves market makers short convexity across both ETF and offshore venues. When spot breaks, hedging flows can reinforce the feedback loop. In the graph below we show the movement of IBIT option volume and BTC U.S.-hours realized volatility. We can see that the relationship has strengthened over the past weeks.

Chart 1 illustrates the co-movement between IBIT option volume and BTC U.S.-hours realized volatility, showing that their relationship has strengthened in recent weeks. To formally evaluate this relationship, we regress bitcoin realized volatility on lagged IBIT options volume while controlling for BTC funding rates, equity returns (Nasdaq Composite), implied volatility (CBOE Volatility Index, or VIX), short-term interest rate changes and U.S. dollar movements. The results indicate that IBIT options trading activity is significantly associated with BTC volatility even after accounting for broader macroeconomic conditions.

Chart 1: Movement of IBIT option volume and BTC U.S.-hours realized volatility

Table 1: OLS regression IBIT options volume on BTC volatility

Table 2: BTC volatility distribution pre and post IBIT Options

We split the data into before vs. after IBIT options began trading. For each hour of the day (UTC), we measure how much bitcoin’s price moved in that hour. Then we convert it into a share of the day’s total volatility — so each column adds up to 100%. The highlighted band (14:00-16:00 UTC) lines up with peak U.S. trading activity, especially the U.S. cash equity open. After, IBIT options volatility becomes more concentrated in these U.S. hours — suggesting more price discovery and hedging flow is happening when U.S. markets are most active.

February as illustration

The early February selloff provides a useful example. Bitcoin fell sharply during one of the most extreme cross-asset deleveraging episodes in recent years. Yet IBIT recorded net creations rather than redemptions, which argues against retail panic.

In a thoughtful Substack post, Jeff Park suggested the catalyst was cross-asset positioning amidst some of the big multistrategy funds rather than crypto-specific stress. Correlations between bitcoin and high-beta software equities tightened materially, indicating multi-asset portfolios were being indiscriminately de-risked.

At the same time, the CME bitcoin basis widened dramatically. Near-dated basis moved from roughly three percent to close to nine percent. Such a move is consistent with multi-strategy funds unwinding delta-neutral basis trades by selling spot or ETFs and buying futures under gross exposure constraints.

As prices declined into that environment, existing short-gamma positioning may have amplified the downside through mechanical delta-hedging. Dealers’ short convexity must sell into weakness. The sharp rebound that followed on Friday the 6th is consistent with hedges being rebalanced once acute pressure subsided.

The episode illustrates a broader point. Bitcoin now participates in the same balance sheet and derivatives mechanics that govern equities and other risk assets.

Digital gold, or leveraged Nasdaq?

This evolution complicates the “digital gold” narrative. Bitcoin’s correlation with gold has historically been unstable and often close to zero over shorter horizons. BlackRock’s Head of Digital Assets, Robert Mitchnick, has argued that heavy speculative positioning can cause bitcoin to behave more like a leveraged Nasdaq proxy than a macro hedge. This observation is directionally correct. In Chart 3 we are showing that the BTC-Nasdaq correlation during U.S. trading sessions approximately doubled since inception of IBIT options. Increasingly, however, it is not only speculative longs that matter. Delta-neutral strategies and derivatives positioning inside traditional markets now contribute to volatility feedback loops.

Chart 2: Bitcoin’s correlation with Nasdaq pre- and post IBIT options

Bitcoin began outside the financial system. The success of IBIT and IBIT options shows it is now embedded within it. For long-term allocators, this does not invalidate the structural case for digital scarcity. It does mean that short-term price action is increasingly shaped by positioning, hedging and cross-asset flows.

Bitcoin is no longer trading outside the system. It is trading inside it.

The information contained herein is provided for informational and educational purposes only and should not be construed as investment, legal, or tax advice. Nothing contained in this document constitutes an offer to sell, or a solicitation of an offer to buy, any securities, investment products, or advisory services.

Lionsoul Global Advisors LLC is registered with the Texas State Securities Board (CRD #: 324883). The advisory services provided by Lionsoul Global Advisors are available exclusively to non-U.S. investors who meet applicable eligibility, accreditation, and qualification standards under relevant laws and regulations.

Headlines of the Week

– By Francisco Rodrigues

Trump’s Mar-a-Lago crypto summit would’ve been unthinkable just a few years ago. Now we’re not only getting that, but also a $17 billion trading volume debut of a crypto-linked ETF and more in a single week.

• Goldman Sachs, Franklin Templeton, and Nicki Minaj: Inside Trump’s surreal Mar-a-Lago crypto summit: The World Liberty Financial form at Mar-a-Lago included figures from traditional finance, crypto and real estate in an intimate setting, with panels touching on crypto and the future of tokenized real estate.
• To freeze or not to freeze: Satoshi and the $440 billion in bitcoin threatened by quantum computing: Quantum computing is slowly moving closer to reality, and as it does, nearly 7 million bitcoin could potentially be at risk. That includes Satoshi Nakamoto’s estimated 1 million BTC.
• ProShares’ stablecoin-ready ETF sees $17 billion debut, sparking speculation about Circle: ProShares’ IQMM money market ETF, designed to comply with U.S. stablecoin reserve requirement under the GENIUS Act, saw $17 billion in first-day trading. That sparked speculation that stablecoin issuers could be moving funds.
• Bitcoin balances on Binance hit highest since November 2024 – here’s what it means: Users’ bitcoin holdings in Binance-linked wallets are at their highest level since late 2024, which could have bearish implications on an already depressed market.
• Specialized AI detects 92% of real-world DeFi exploits: Purpose-built AI could detect vulnerabilities in 92% of 90 exploited decentralized finance (DeFi) contracts, accelerating concerns over offensive AI capabilities.

Chart of the Week

Mid-caps show surprising strength as large caps lag bitcoin

While Bitcoin is down 27.7% YTD and large-cap indices like the CD5 and CD20 are underperforming it (down 30% and 32% respectively), the CD80 is showing resilience with a shallower drawdown of only 20.91%. This represents a 7% relative outperformance against Bitcoin, a reversal of the typical “risk-off” dynamic where smaller assets crash harder than the lead. This strength suggests a “seller exhaustion” phase for mid-caps, where the heavy weightings of idiosyncratic performers like Hyperliquid (HYPE) and Canton Coin (CC) are decoupling from the broader institutional sell-off seen in large-caps.

Listen. Read. Watch. Engage.

Looking for more? Receive the latest crypto news from coindesk.com and explore our robust Data & Indices offerings by visiting coindesk.com/institutions.

Tokenization at enterprise scale is fundamentally an architectural decision. While market conversations often emphasize speed of deployment, the true determinant of long-term viability lies in the structural integrity of the underlying white label tokenization platform.

Smart contract modularity, compliance logic programmability, interoperability layers, custody integrations, and upgrade mechanisms collectively define whether the system can withstand regulatory evolution and transaction scale. Selecting white label tokenization software without evaluating its contract architecture and governance design introduces systemic limitations that compound over time.

The decision framework must therefore begin at the infrastructure layer — not the user interface.

What Is a White-Label Tokenization Engine?

A white-label tokenization engine is a pre-built, customizable blockchain-based infrastructure that enables organizations to issue and manage tokenized assets under their own brand.  A white-label tokenization engine is faster to market than a custom-built solution, but still allows for customization and configuration of compliance.

Core capabilities include:

• Token issuance and lifecycle management
• Compliance rule enforcement
• Investor onboarding and KYC integration
• Governance and voting modules
• Smart contract management
• Asset reporting dashboards

When supported by robust white label tokenization development services, such platforms allow enterprises to retain strategic control while minimizing infrastructure risk.

Why the Choice of Tokenization Engine Impacts Long-Term Scalability

Enterprises looking to establish themselves in regulated digital asset markets will find that scalability is about much more than just transaction throughput; it also includes aspects such as regulatory elasticity, architectural modularity, liquidity enablement, operational automation, and ecosystem interoperability.

In this case, the white label tokenization platform will become your programmable underpinning that helps determine if growth will be seamless or stifled by the architecture of your tokenization platform infrastructure

Choosing robust enterprise white label tokenization solution will allow you to scale without having to continually re-build your infrastructure to support the new level of growth. Instead, scalability will be part of the smart contract architecture, governance logic and integration stack from the very beginning.

1. Regulatory Elasticity and Compliance Automation

Regulatory environments are dynamic. Jurisdictional policies evolve, disclosure requirements expand, and investor eligibility criteria shift over time. A technically mature white label tokenization software solution must therefore incorporate a configurable compliance rule engine rather than static rule sets.

Scalable compliance architecture should support:

• Jurisdiction-based transfer restrictions
• Role-based investor permissions
• Whitelisting and blacklisting logic embedded at contract level
• Automated dividend and reporting triggers
• On-chain audit trail generation

When compliance is deeply integrated into smart contract logic, enterprises can scale across borders without redeploying infrastructure. Organizations leveraging robust white label tokenization development services benefit from programmable regulatory adaptability instead of reactive redevelopment cycles.

2. Modular Smart Contract Architecture and Upgradeability

Long-term scalability depends on modularity. Monolithic contract deployments restrict flexibility and introduce systemic risk during updates. A future-ready white label tokenization platform must employ structured contract patterns such as proxy upgrade mechanisms, modular deployment layers, and governance-controlled upgrade pathways.

Scalable architecture includes:

• Separation of logic and storage contracts
• Version-controlled contract upgrades
• Governance-based modification approvals
• Emergency pause and recovery mechanisms
• Deterministic permission hierarchies
  

A capable white label tokenization platform development company ensures that upgradeability does not compromise security, enabling protocol evolution without disrupting active tokenized assets.

3. Multi-Asset and Multi-Chain Interoperability

Enterprises rarely tokenize a single asset class. Over time, expansion into real estate, debt instruments, equity, structured funds, or commodities becomes a strategic objective. The selected enterprise white label tokenization solutions framework must therefore support multi-asset issuance under a unified infrastructure.

Scalability requires:

• Compatibility with multiple token standards
• Configurable token economics models
• Cross-chain deployment capability
• API-driven interoperability with exchanges and custodians
• Bridge mechanisms for liquidity routing

An interoperable white label tokenization software stack prevents vendor lock-in and supports ecosystem expansion without structural redesign.

4. Liquidity and Secondary Market Enablement

Token scalability is incomplete without liquidity scalability. The ability to integrate secondary trading platforms, digital custodians, and automated settlement layers determines whether tokenized assets achieve sustainable market participation.

A scalable white label tokenization platform should enable:

• Transfer restriction logic aligned with exchange standards
• Custodial wallet compatibility
• Atomic settlement automation
• Fractional ownership models
• Yield distribution and dividend automation

Well-architected white label tokenization development services embed liquidity readiness within the core system rather than retrofitting it later.

5. Performance Engineering and Infrastructure Scaling

As investor participation increases, transaction volume grows. Scalability must extend to system performance, including gas optimization, throughput management, and infrastructure redundancy.

Enterprise-grade enterprise white label tokenization solutions incorporate:

• Layer-2 compatibility or sidechain deployment options
• Gas-efficient contract design
• Cloud-native infrastructure orchestration
• Horizontal scaling capability
• Disaster recovery and failover mechanisms

Without these controls, operational strain increases as adoption grows.

6. Data Orchestration and Reporting Scalability

Institutional markets demand transparency. As asset portfolios expand, reporting complexity intensifies. A scalable white label tokenization software framework must integrate:

• Real-time dashboard analytics
• Automated investor statements
• Regulatory reporting exports
• On-chain/off-chain data synchronization
• Event-driven accounting automation

Data orchestration scalability ensures compliance continuity and investor confidence during growth phases.

7. Governance and Operational Automation

As ecosystems grow, manual oversight becomes inefficient. A technically advanced white label tokenization platform should support automated governance mechanisms, including:

• On-chain voting modules
• Role-based administrative controls
• Multi-signature authorization flows
• Smart contract-based distribution automation

When governance logic is programmable, operational expansion does not proportionally increase administrative complexity.

Step-by-Step Decision Framework for Enterprises

To select a white label tokenization platform, organizations need to evaluate the overall architecture, not just conduct a vendor comparison. Because both regulatory and other operational factors affect the issuance of tokenized assets, organizations must evaluate the depth of their infrastructure, as well as its compliance programmability, integration capabilities and upgrade options in order to implement properly.

Organizations must evaluate the criteria listed below when evaluating enterprise white label tokenization solutions for scalable enterprise implementations.

Step 1: Define Asset Class and Jurisdictional Scope

Before evaluating vendors, enterprises must clarify:

• Type of asset (real estate, funds, bonds, commodities)
• Target investor profile
• Operating jurisdictions
• Licensing requirements
  

Different assets require different compliance logic and token standards. A scalable white label tokenization platform must accommodate multi-asset issuance under varying regulatory environments.

Step 2: Evaluate Compliance and Governance Architecture

Compliance must be programmable. Enterprises should assess whether the platform supports:

• KYC/AML integration
• Investor accreditation verification
• Transfer restrictions
• Dividend and distribution automation
• Voting and governance modules
  

The strongest white label tokenization development services integrate compliance into smart contract logic rather than treating it as a manual overlay.

Step 3: Assess Smart Contract Architecture and Security

Security is non-negotiable. Key evaluation criteria include:

• Third-party audited smart contracts
• Modular architecture
• Multi-signature controls
• Role-based administrative permissions
• Incident response mechanisms

A credible white-label tokenization platform development company should demonstrate a strong audit history and transparent security documentation.

Step 4: Examine Integration and API Infrastructure

Tokenization does not operate in isolation. Enterprises must verify:

• API accessibility
• Banking and payment gateway integration
• Custodian connectivity
• ERP and CRM compatibility
• Reporting and analytics dashboards
  

A well-structured white label tokenization software solution integrates seamlessly into existing financial infrastructure.

Step 5: Review Customization Flexibility

White-label does not mean rigid. Evaluate:

• Branding capabilities
• UI/UX customization
• Token economics configuration
• Investor portal personalization
• Workflow modification flexibility

Customization ensures differentiation in competitive markets.

Step 6: Analyze Scalability and Performance

Infrastructure must support growth. Key technical considerations:

• Transaction throughput
• Gas optimization mechanisms
  Cloud deployment flexibility
• Load balancing architecture
• Disaster recovery systems

An enterprise-grade engine must support large investor volumes without performance degradation.

Must-Have Features in an Enterprise White-Label Tokenization Platform

A production-ready white label tokenization platform must go beyond basic issuance functionality and deliver infrastructure-grade capabilities aligned with regulatory compliance, security resilience, and institutional scalability. Enterprise adoption depends on how deeply the white label tokenization software embeds automation, governance logic, and interoperability within its core architecture.

1. Multi-Asset Issuance Support – Enables structured token creation across diverse asset classes within a unified infrastructure.
2. Configurable Compliance Engine – Embeds programmable transfer restrictions, investor eligibility rules, and jurisdictional controls directly into smart contracts.
   Role-Based Governance Management – Implements hierarchical access controls and on-chain voting mechanisms for structured decision-making.
3. Automated Dividend and Yield Distribution – Streamlines financial payouts through smart contract-triggered settlement logic.
4. Custodial Wallet Integration – Ensures compatibility with institutional-grade custody providers for secure asset management.
5. Secondary Market Readiness – Supports compliant token transfers and exchange integrations to facilitate liquidity.
6. Real-Time Reporting Dashboards – Provides synchronized on-chain and off-chain data visibility for regulatory and investor reporting.
7. Smart Contract Upgradeability – Allows controlled protocol evolution without disrupting active tokenized assets.

Cost of a White-Label Tokenization Platform: What Enterprises Should Expect

The cost of implementing a white label tokenization platform varies significantly depending on architecture depth, compliance complexity, and customization scope. Enterprises must evaluate cost across multiple dimensions rather than focusing solely on licensing fees.

1. Platform Licensing or Base Infrastructure Cost

This includes core smart contract frameworks, admin panels, and issuance modules.

2. Customization & Integration Cost

• UI/UX personalization
• Custody integration
• API development
• Compliance configuration
  

Advanced white label tokenization development services increase upfront cost but reduce long-term re-engineering expenses.

3. Security & Audit Expenses

Smart contract audits, penetration testing, and compliance validation are non-negotiable for enterprise-grade deployments.

4. Infrastructure & Cloud Hosting

Costs depend on blockchain selection, transaction volume, and deployment model (public, private, or hybrid).

5. Ongoing Maintenance & Upgrade Costs

Includes contract updates, regulatory modifications, technical support, and feature enhancements.

Building Future-Ready Tokenization Infrastructure

Selecting the right white label tokenization platform is a long-term infrastructure decision that directly influences regulatory agility, liquidity scalability, governance automation, and ecosystem expansion. Enterprises that approach this evaluation with architectural rigor — assessing smart contract modularity, compliance depth, interoperability, and upgrade pathways — position themselves to build resilient and future-ready digital asset frameworks.

As a leading white label tokenization platform development company, Antier delivers enterprise-grade tokenization infrastructure engineered for security, configurability, and regulatory alignment. With deep expertise in blockchain architecture, compliance-driven smart contracts, and scalable deployment models, Antier empowers financial institutions, asset managers, and fintech innovators to launch and scale institutional tokenization ecosystems with confidence.

For organizations seeking a strategically aligned tokenization partner, Antier provides the expertise and infrastructure required to transform asset digitization into sustainable market advantage.

The crypto industry demonstrated in the last U.S. elections that $100 million spent on congressional campaigns could influence policy outcomes for the sector, so when an emerging crypto political action committee anonymously promised to bring that amount to the 2026 table, it suggested a significant new (unidentified) voice in digital assets politics.

But the Fellowship PAC never arrived.

A September press release received wide attention last year as a major leap in the industry’s already hefty campaign spending from the more established leading super PAC, Fairshake. Among its backers, the new group was reportedly to include Tether, the global leader in stablecoins with its USDT and more recent push into the U.S. with a separate affiliate and the USAT token, though representatives from the company declined to confirm any connection.

“Unlike past political efforts, the Fellowship PAC’s mission is defined by transparency and trust, ensuring political action directly supports the broader ecosystem rather than narrow or individual interests,” the PAC’s original September release said, seeming to suggest it would plot a different course than Fairshake. The release did not identify any officers, donors or key employees, nor did the PAC’s website.

Fellowship’s announcement credited President Donald Trump with a regulatory framework “that puts America on the path to become the global crypto capital.”

When asked about the involvement of Tether, which established its U.S. division around the same time as the Fellowship unveiling, company spokesperson Alex Welch said this week that the global Tether has no say in the PAC but was silent on whether the U.S. operations had any part in Fellowship.

“Tether International has no affiliation or oversight of Fellowship, so any inquiries can be directed to the Fellowship website and associated email,” Welch said in an email.

Repeated attempts to contact Fellowship went unanswered, though it established the website and an account on social media site X, where its most recent activity was reposting a comment from Tether CEO Paolo Ardoino earlier this month. It also registered as a super PAC with the Federal Election Commission, listing its treasurer as Mitchell Nobel, who directs digital-assets strategy at Cantor Fitzgerald, where Trump’s Secretary of Commerce Howard Lutnick was CEO. That firm has also handled Tether’s assets in recent years.

What Fellowship didn’t do, according to FEC records, was receive any money to operate with. Its current filings show zero funds on-hand.

Under U.S. election law, a PAC can’t be funded by a non-U.S. entity. Foreign money influencing U.S. politics has been a longtime concern, and it’s drawn new scrutiny during the Trump administration, including from those suggesting that Trump-supporting PACs may have improper ties to foreign donors. Political involvement from Tether — if it had emerged — may have attracted further scrutiny, even if confined to its U.S. operations, because such a subsidiary would have to represent that its money was generated domestically and its political decisions weren’t guided by foreign nationals.

Meanwhile, the industry’s top super PAC, Fairshake, has said it has $193 million and that the PAC and its affiliates have begun targeting their first campaigns, seeking to ensure pro-crypto candidates eventually join Congress. In the 2024 cycle, Fairshake — primarily funded by Coinbase, a16z and Ripple — supported more than 50 candidates from both parties who are now in the Senate and the House of Representatives.

Some of the earliest 2026 primaries are fast approaching, meaning any new entrants to political spending could arrive late to the party. It’s unclear whether the midterm congressional elections will yet see Fellowship’s “$100 million commitment to back pro-innovation, pro-crypto candidates who will safeguard America’s role as the global leader in digital assets and entrepreneurship.”

The total crypto market cap has added $150 billion in just over a day.

The cryptocurrency markets are on the move again, this time in the opposite direction compared to the most recent developments and price pressure.

Bitcoin, for example, skyrocketed by more than five grand since yesterday’s low. Recall that the asset plunged to a multi-week low of $62,500 atfter the latest uncertainty sparked from the US tariff regime by Trump over the weekend.

However, the largest cryptocurrency exploded off that local bottom in the following hours. Minutes ago, it flew to $68,000 for the first time since the weekend, and CoinGecko data currently shows that it’s up by over 6% in the past 24 hours alone.

Data shared by analyst CW shows “explosive buying,” according to the BTC CVD indicator. They attributed it to whales stepping up and buying the latest dip, while indicating that retail has remained on the sidelines.

The $BTC CVD indicator shows explosive buying.

Buying from whales is exploding. However, buying from retail investors (the orange group) is nothing.

Furthermore, the selling wall at 70k has disappeared. buying force is increase, while resistance has decrease. pic.twitter.com/huIaoqxOeW

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— CW (@CW8900) February 25, 2026

Even more impressive gains come from some altcoins, including their leader. Ethereum has rocketed by over 10% daily and now trades well above $2,000 after it slipped and retested the $1,800 support yesterday. Recent analysis from Ali Martinez shows that ETH has either already bottomed or it’s very close to doing so.

XRP has jumped by 7% in the past day, and now sits above $1.45. This means that the cross-border token has reclaimed the coveted $1.36 support, which many analysts called its most significant level in terms of determining whether XRP still has legs to run.

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SOL has pumped by over 12%, making it the biggest gainer from the larger-cap alts. DOGE follows suit, with a 10% jump to over $0.10. FIL, DOT, MORPHO, APT, and UNI have rocketed by over 20% daily.

The total value of wrecked positions has jumped to nearly $400 million daily, with shorts responsible for the lion’s share. BTC and ETH shorts are worth almost $300 million daily. More than 100,000 traders have been wrecked, while the single-largest liquidation order (worth $11.32 million) took place on Hyperliquid.

Solana price has rebounded nearly 9% after falling to around $75 on February 23, and it is still holding most of those gains above $82.

This kind of bounce normally attracts strong buyers because it suggests the worst may be over. But that is not what is happening this time. The investors who usually step in during recoveries — long-term holders — are stepping back instead. This creates an unusual disconnect between price and conviction, and it helps explain why Solana’s rebound is already facing pressure.

Long-Term Holder Buying Has Dropped Nearly 62% Despite the Price Bounce

The clearest sign of weakening conviction comes from the HODLer Net Position Change metric. This indicator measures how much long-term holders, defined as wallets holding Solana for more than 155 days, are adding or reducing over a rolling 30-day period.

On February 10, long-term holders added about 1.5 million SOL. By February 24, that number had fallen sharply to just 564,317 SOL. This marks a drop of about 62.5% in accumulation within two weeks. This decline happened even as Solana’s price stabilized and rebounded, which makes the shift especially important.

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In simple terms, Solana’s strongest holders were buying aggressively earlier in the month, but that confidence has faded significantly. When accumulation falls this sharply, it suggests these investors are no longer convinced the current bounce is the start of a sustained recovery. Despite the SOL price bounce, the Hodler positioning is at its lowest monthly level.

Disclaimer: This does not mean long-term holders are heavily selling, but it shows their buying momentum has weakened sharply.

This shift is not limited to the oldest holders. Mid-term holders, who have held Solana between one month and three months, have also been reducing their exposure. Their share of total supply fell from 19.52% on January 25 to about 14.08% on February 24. This represents a 27.9% relative decline in their supply share in just one month.

What makes this important is the timing. This reduction persisted even as Solana’s price rose over the past two days. Instead of buying the rebound, many holders appear to be using it as an opportunity to exit.

A 22 Million SOL Supply Wall Is Blocking the Recovery

The lack of strong buying becomes more concerning when combined with Solana’s cost basis distribution data, which reveals where investors last bought their coins.

This data shows a major concentration of supply between $82.81 and $83.79. More than 22.16 million SOL was accumulated in this range. This is one of the largest supply clusters currently sitting above the price.

This range represents a break-even zone for many holders who bought earlier and held through the previous dips. When price returns to their entry level, these investors often sell to recover losses or reduce risk in a weaker market.

This helps explain why Solana’s rebound is already slowing near $82.91. The price is running into a large group of holders waiting to exit at break-even.

At the same time, long-term holder accumulation has already dropped by more than 60%, which means there are fewer strong buyers available to absorb this supply. This imbalance between sellers and buyers makes it harder for the rebound to continue.

Solana Price Path Still Points to a 17% Drop

Solana’s technical structure adds another layer of risk to the current rebound. Before this bounce, Solana confirmed a bearish head-and-shoulders pattern and dropped to around $75.69.

Even after the recent rebound, the projected downside target from that pattern still points toward the $68.71 region. From the current price near $82.52, a drop to $68.71 would represent an additional decline of about 17%. This means the recent 9% bounce has not yet invalidated the broader bearish structure. Moreover, Solana tried to cross the $82.91 mark but failed, largely due to the supply cluster around that level highlighted earlier.

For the recovery to strengthen, Solana must first break and hold above $82.91, which is the immediate resistance created by the supply cluster. If that level is cleared, the next resistance sits near $86.82. A move above $91.33 would fully invalidate the bearish pattern and confirm that the downtrend has ended.

However, continued rejection at $82.91 would increase downside risk.

If Solana falls below $80.89 again, it could quickly retest $74.96. A break below that would reopen the path toward $68.71 and other lower levels, which remain the active downside projection from the bearish pattern.

TLDR:

• • South Korea’s Democratic Party is drafting bills requiring finfluencers to disclose crypto holdings and compensation before advising followers.
    
  • Reports of illegal investment advisory activity surged from 132 cases in 2018 to 1,724 cases in 2024, prompting stricter oversight.
    
  • Penalties for finfluencer violations are expected to match existing laws on market manipulation and pre-emptive trading in Korea.
  • Researchers are calling for pre-monitoring, post-sanctions, and added social media rules to protect retail crypto investors from misleading advice.

South Korea is proposing a law that would require finfluencers to disclose their crypto holdings. Democratic Party lawmaker Kim Seung-won is leading the push with two amendment bills.

The legislation targets influencers who advise followers on stocks and virtual assets through social media. Holdings, compensation, and asset quantities would all need to be made public. Reports of illegal investment advisory activity have risen sharply in recent years, prompting the move.

Proposed Bill Targets Crypto Finfluencers Operating Without Disclosure

Rep. Kim Seung-won, a member of the National Assembly’s Political Affairs Committee, is preparing the amendments.

One bill proposes changes to the Capital Markets Act, while the other targets the Virtual Asset Users Protection Act. Together, they would require crypto finfluencers to reveal what they hold before advising others to buy or sell. This applies to those who give repeated advice or charge fees for investment guidance.

The rules would cover advice shared through social media, broadcasts, publications, and other communications. A presidential decree would set the exact boundaries of who falls under the law.

Penalties for non-compliance are expected to match those for market manipulation and pre-emptive trading. This places crypto finfluencers under the same legal standards as other financial market participants.

Rep. Kim explained the reasoning behind the proposal, stating that “so-called fink influencers are appearing who give advice on investment decisions to an unspecified number of people without receiving compensation from positions that can have a great influence on the public.”

He pointed to a growing number of influencers advising large audiences without revealing their own crypto positions.

When influencers hold assets they promote without disclosure, it raises serious conflict-of-interest concerns. The bill directly addresses this gap by making transparency a legal requirement.

The Financial Supervisory Service recorded 1,724 reports of illegal advisory activity in 2024, up from just 132 in 2018. That increase spans only six years and reflects how quickly the problem has grown.

The rise of online and social media channels has made it far easier to reach investors without proper credentials. Crypto markets, in particular, have seen a surge in influencer-driven trading activity.

Korea Aligns With Global Push to Regulate Crypto Finfluencer Activity

Other major markets have already moved to regulate finfluencer conduct. The UK’s Financial Conduct Authority requires pre-approval of all promoted financial products, including digital assets.

The US Securities and Exchange Commission and FINRA have issued fines against influencers who violated disclosure rules. South Korea’s proposal follows the same direction these regulators have already taken.

Ahn Yu-mi, a senior researcher at the Capital Market Research Institute, noted that “the number of registered pseudo-investment advisory firms has increased significantly as sales channels have been mainly online.”

She added that this shift has also expanded “the possibility of detecting illegal and unsound acts.” However, she stressed that detection alone does not protect investors from harm. A structured oversight system covering both finfluencers and the institutions working with them is still needed.

Ahn further stated that “considering the ever-increasing influence and risk of pininfluencers, a strong management system such as pre-monitoring and post-sanctions by financial authorities is required.”

She also called for financial authorities to “continuously monitor finfluencies and financial institutions that use them.” On top of that, she recommended “the establishment of additional rules to be followed when providing financial information through social media.”

Without formal rules in place, the gap between influencer reach and regulatory oversight will only continue to widen.

South Korea’s proposal reflects a broader shift in how governments are responding to crypto finfluencer activity. As virtual asset markets grow, so does the need for rules that protect investors from undisclosed conflicts of interest.

Bitcoin BTC$65,121.75 bounced back to $67,500 during Wednesday’s U.S. morning session, gaining more than 5% over the past 24 hours as deeply bearish positioning across the crypto market began to unwind.

The move sparked a broader relief rally across altcoins. Ethereum’s ether (ETH) surged 10%, reclaiming the $2,000 level for the first time in a week. Solana (SOL), DOGE$0.09290, ADA$0.2663 and Chainlink LINK$8.4681 each advanced more than 10%, outperforming bitcoin and the broad-market benchmark CoinDesk 20 Index’s gains.

Wednesday’s bounce follows a period of extremely negative sentiment across the market. The Crypto Fear & Greed Index, a popular sentiment gauge, has been hovering in Extreme Fear levels for most of February.

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Perpetual futures funding rates — the periodic payments between long and short traders — had also turned negative multiple times over the past weeks. This means short sellers have been paying longs to maintain positions, a sign that bearish bets had become crowded. Such setups often leave markets vulnerable to sharp squeezes higher when prices begin to rise.

The rebound has liquidated over $307 million in leveraged bearish bets across crypto derivatives over the past 24 hours, CoinGlass data shows. Notably, bitcoin perpetual funding rates remain below neutral even amid the rally, suggesting the move isn’t being driven by aggressive leveraged speculation.

Crypto stocks gain

Crypto-related equities also joined the advance. Stablecoin issuer Circle (CRCL) jumped 20% after an earnings beat, while Coinbase (COIN), bitcoin treasury firm Strategy (MSTR) and Galaxy (GLXY) gained 5%-6%. Bitcoin miners — increasingly tied to AI infrastructure themes — extended their rebound, with Bitfarms (BITF), Bitdeer (BTDR) and MARA Holdings (MARA) leading gains.

Many crypto-linked stocks had built up sizable short interest from hedge funds, 10x Research’s Markus Thielen noted, leaving them primed for a sharp reversal.

Improving risk appetite across traditional markets has given a favorable backdrop for the crypto bounce. The S&P 500 and the tech-heavy Nasdaq 100 were 0.6% and 1.1% higher, respectively, in the early hours of trading. The software sector, embattled by AI fears, extended its gains, with the iShares Expanded Tech-Software Sector ETF (IGV) up by another 2% during the session.

Early signs of U.S. buyers returning

For the first time in over 40 days, the Coinbase Premium Index has turned positive again. This index tracks the price difference between bitcoin on Coinbase, a major U.S. exchange, and the broader global market average. It is widely viewed as a gauge of U.S. capital flows, institutional participation, and overall market sentiment.

While the MSTR to IBIT ratio is up 12% year to date, indicating that Strategy has outperformed BlackRock’s ETF. This relative strength points to continued risk-on appetite, even as bitcoin has fallen 25% this year.

In addition, the U.S. spot bitcoin ETFs recorded $257.7 million in inflows on Tuesday, the largest daily total since Feb. 6.

UK politicians concerned with foreign interference in politics are calling for temporary restrictions on crypto donations to be put in place until permanent legislation is drafted.

The Joint Committee on the National Security Strategy called for the measures in a letter to the UK’s Communities Secretary, Steve Reed, on Tuesday.

In the letter, Committee Chair Matt Western recommended five temporary measures: 

• A temporary ban on accepting crypto donations until the Electoral Commission publishes its own guidance on interim crypto measures. 
• Crypto donors should be prevented from using crypto firms that aren’t registered with the Financial Conduct Authority to make their donations
• Donations should be converted into sterling within 48 hours of their receipt.
• Crypto that’s been “upstream” from crypto mixers and tumblers, such as Tornado Cash, should be prohibited.
• Crypto should only be accepted when an individual has “high confidence” about its origins.

Kraken says crypto ban will ‘displace’ political donations

The committee took into consideration the views of various stakeholders, crypto entities, charities, and research groups when deciding on its recommendations.  

Despite this, not everybody is happy. Kraken’s Chief Compliance Officer Natasha Powell, for example, warned that a ban would displace crypto donors to shadier avenues of funding, and that donors should be allowed to make donations from UK-regulated institutions.

“If you say, ‘No crypto donations, they’re illegal,’ people will go offshore and find different ways of doing them,” said Powell. “They will keep happening; they will just do so under the radar.”

Solana’s SOL (SOL) has rallied 10% over the past 24 hours, rising to an intraday high of $86 on Wednesday.

The recovery was accompanied by a leap in futures activity, with SOL’s open interest rising by more than 5% to $5.27 billion.

Analysts are now focusing on the short-term technical setup and fundamental indicators that may signal a major turning point for SOL.

Key takeaways:

• SOL price has risen 10% in 24 hours, fueled by bullishness in the broader market and Solana ETF inflows.

• Solana’s symmetrical triangle breakout targets $110 SOL price.

SOL recovers with the crypto market

The SOL/USD pair rose as much as 13.6% to $86 on Wednesday from a two-week low of $75 on Tuesday, amid a marketwide recovery.

Bitcoin (BTC), the market leader, was trading at $66,800 at the time of writing, up 5% over the 24 hours. Second-placed Ether (ETH) has gained about 8% on the day to trade just above $1,990. XRP (XRP) has also posted significant daily gains among the top 10 cryptocurrencies, up 6% over the same period.

As a result, the global crypto market capitalization is up 4% on the day to $2.28 trillion on Wednesday.

Solana’s surge today is accompanied by significant short liquidations totaling $15.4 million over the last 24 hours, signaling intense demand-side pressure.

The buyers were also US-based spot Solana ETFs, which have recorded $40 million in net inflows since Feb. 9.

The growing demand-side pressure that could push SOL prices higher when coupled with increased inflows from global Solana investment products and buying by whales.

SOL’s symmetrical triangle breakout targets $110

Data from TradingView shows SOL price breaking above a symmetrical triangle on the six-hour time frame, as shown in the chart below.

The price needs to close above the 100-day simple moving average (SMA) at $86 to sustain the upward momentum.

The measured target of the prevailing pattern, calculated by adding the height of the triangle to the breakout point, is $110, coinciding with the 50-day SMA. This represents a 28.5% rally from the current levels. 

As Cointelegraph reported, a daily candlestick close above the 20-day EMA, currently at $88, would open the way for a rise toward $95 and later to $117. 

Glassnode’s realized price distribution data for Solana shows limited historical buying activity above $85, suggesting that the bulls could easily break this resistance.

In other words, there are relatively few SOL holders with a cost basis above this zone, reducing the chances of sellers stepping in decisively until the price reaches higher supply zones. 

The next significant resistance sits at $115, where approximately 22 million SOL were previously acquired.