Crypto
Crypto’s Split Screen: Washington Tightens the Rules as Markets Wobble and Hackers Strike Again
Article by: CryptoMan
Cryptocurrency had one of those days this week that captures the industry’s entire identity crisis in miniature: regulators in Washington were busy building guardrails for an asset class that keeps proving, hack after hack, why it needs them, while traders shrugged off a nine-figure exchange breach and kept their eyes on bond yields instead.
On Thursday, the Federal Reserve unveiled a long-awaited proposal spelling out capital, redemption and disclosure requirements for stablecoin issuers operating under its supervision — the clearest sign yet that Washington intends to treat dollar-pegged tokens less like speculative curiosities and more like the payment infrastructure they’re becoming. The same day, crypto exchange Bitget confirmed that roughly $351.6 million had been siphoned out of its hot wallets, forcing a temporary halt to withdrawals. Meanwhile, Bitcoin held a shaky line near $84,000 as the 10-year Treasury yield touched levels not seen since 2007, and the Commodity Futures Trading Commission quietly rewrote its own rulebook after Congress once again failed to pass comprehensive crypto legislation.
Taken together, it’s a snapshot of an industry maturing on two tracks at once — one where federal agencies race to fill the vacuum left by a gridlocked Congress, and another where the everyday hazards of running billions of dollars through digital wallets haven’t gone away.
The Fed lays down the law on stablecoins
The Fed’s proposal is its first major step in implementing the GENIUS Act, the law that already requires stablecoin issuers to back their tokens one-to-one with cash, bank deposits or short-term Treasurys. What the Fed added Thursday is the fine print: an operational-risk capital charge scaled to an issuer’s size — 2% on the first $20 billion in stablecoins outstanding, 1.5% on the next $30 billion, and 1% above that — plus additional buffers tied to credit and operational risk. Issuers would generally have to honor redemptions within two business days, and if their reserves ever dip below full backing, they’d be required to notify the Fed immediately and either top up the shortfall or start liquidating and redeeming tokens.
Transparency is baked in too. Issuers would have to publish monthly reports on their outstanding tokens and reserve composition, independently audited and personally certified by their CEO and CFO. A companion proposal would open a formal application pathway for Fed-supervised banks that want to issue stablecoins through subsidiaries.
Fed Governor Michael Barr backed the plan but made clear the job isn’t finished. “Stablecoins will only be stable if they can be reliably and promptly redeemed at par in a range of conditions,” he said, flagging market stress and issuer-specific strain as the real tests of any framework. Barr also pushed for stronger, universal redemption rights in the final rule and warned against language that would limit the Fed’s ability to act on anti-money-laundering failures unless they’re deemed “significant or systemic.”
The proposals now face a 60-day public comment period. The GENIUS Act itself is set to take effect January 18, 2027, or 120 days after final rules are issued — whichever comes first.
Congress stalls, so regulators move on their own
The stablecoin push arrived just days after the Senate failed to advance the Digital Asset Market Clarity Act, the bill meant to finally settle which agency — the SEC or the CFTC — has jurisdiction over which corner of the crypto market. With that effort stalled and few expecting Congress to revisit market-structure legislation before 2027, both regulators are simply proceeding without it.
The CFTC updated its guidance on tokenized assets and blockchain recordkeeping this week, clarifying that registered entities can invest customer funds in tokenized assets as long as those tokens carry legal and economic rights equivalent to the traditional version, and signaling it won’t object to blockchain-based recordkeeping. CFTC Chair Michael Selig framed the move as an effort “to provide regulatory clarity for the crypto industry,” even as he stopped short of tying it directly to the Senate’s failure. The SEC, for its part, has already floated its own rules on crypto investment contracts, with Chair Paul Atkins saying the agency is “ready, willing, and able” to act without Congress.
A reminder that the risks haven’t disappeared
If regulators are trying to make crypto safer on paper, Bitget’s breach was a reminder of how exposed the industry remains in practice. The exchange said its security systems flagged unauthorized transfers from a limited number of hot and warm wallets Thursday evening, prompting an immediate withdrawal freeze. CEO Gracy Chen said cold wallets were untouched, user balances remained accurate, and the entire stolen sum falls within the exchange’s $464 million User Protection Fund — effectively an insurance backstop meant to make customers whole. Bitget said it has flagged the addresses involved to law enforcement and onchain investigators and promised a full incident report within 24 hours, though it has yet to say how the attackers got in.
It’s the kind of incident that, a few years ago, might have sent shockwaves through crypto markets. This time, prices barely flinched — arguably because investors had bigger macro worries on their minds.
Bitcoin caught between yields and yield-chasers
Bitcoin spent Thursday oscillating around $84,000, briefly dipping below $83,000 before clawing back, as the 10-year Treasury yield climbed to 5.18% — its highest since July 2007 — and the 30-year hit 5.46%. Higher yields make government debt more attractive relative to non-yielding assets like Bitcoin, and the pressure was compounded by a weakening Japanese yen edging toward levels that could trigger intervention, which economist Mohamed El-Erian warned could add further strain to an already jittery Treasury market.
Even so, Bitcoin has managed to extend its August rally, defying predictions tied to its traditional four-year boom-bust cycle. Elsewhere in the market, the tokenized real-world-asset project Ondo Finance was a standout gainer, with its token reclaiming the $0.50 level for the first time since December as BlackRock-backed “Ondo Intelligent Portfolios” launched on Ethereum and BNB Chain — another sign that tokenization of traditional financial products keeps advancing even as legislative clarity lags behind.
And on the infrastructure side, a smaller but telling development: DoubleZero rolled out a dedicated fiber market-data feed for the decentralized exchange Hyperliquid, giving professional trading firms the kind of fast, institutional-grade access to order-book data long taken for granted on venues like the CME or Nasdaq. As Hyperion DeFi CEO Hyunsu Jung put it, onchain markets aren’t becoming traditional exchanges so much as adopting their plumbing — a quiet but steady sign of an industry professionalizing in the background, even as its regulatory foundation is still being poured.
Cryptocurrency is gaining ground as a valid payment method. New laws should provide stability and build user trust in stablecoins as an alternative currency.
The altcoin crypto payment space is generating very interesting opportunities and one of those is DAPAhe, a privacy-focused cryptocurrency built on a BlockDAG architecture; see their website for further details.
While Washington targets fiat-backed stablecoins, the broader industry continues to experiment with alternative privacy architectures.
For instance, newer protocols like DAPAhe are utilizing Layer-1 Twisted ElGamal homomorphic encryption to address these exact network anonymity challenges.
Unlike standard blockchains that store transactional details in plain text, DAPA uses an account-based model secured by a layer-1 Twisted ElGamal homomorphic encryption and Zero-Knowledge Proofs.
This structure allows users to instantly check their balances by querying only the most recent block, providing full network anonymity without requiring a complete blockchain sync.
I checked the webwallet DAPA offer, and it’s a good functional wallet with a history of all transactions and a very easy setup. For me, one of its best features is the sync: once done, you don’t need to do it again unless you leave the browser you see;
🔐 Initializing Secure Balance Decryption
Starting cryptographic table initialization…
Crypto
Justin Sun says Tron post-quantum plan on testnet
Justin Sun, founder of the Tron network, said that the company’s post-quantum cryptography was now live on testnet.
“We’re closely tracking progress in quantum computing and AI, and we’re ready to bring quantum resistance to mainnet at any time, Sun said in a post on X on Saturday.
He added, “We’re committed to keeping user assets secure, and TRON is set to be one of the few major blockchains that is quantum-resistant before Q-Day,” or the day when quantum computing becomes capable of breaking current security standards.
Coindesk reported on July 28 that Blockchain security company AmericanFortress had unveiled a cryptographic plan to protect crypto wallets from future quantum attacks without requiring users to move funds, rotate keys or change wallet addresses.
Unlike most proposed post-quantum approaches, AmericanFortress said it allows existing wallet addresses to remain unchanged while adding post-quantum protection.
Proposal published in technical paper
The company published the proposal in a technical paper on the Cryptography ePrint Archive, though it had not yet been peer-reviewed.
Developers have increasingly focused on post-quantum cryptography because sufficiently powerful quantum computers may eventually break the elliptic-curve cryptography used to secure Bitcoin, Ethereum and many other blockchain networks
Earlier this year, a Strategy-led consortium pledged $15 million to fund Bitcoin quantum security research, the Ethereum Foundation published a proposal for migrating accounts to quantum-resistant cryptography and Algorand outlined plans to introduce quantum-resistant accounts by 2027.
Magazine: SHRINCS BIP published: Quantum-secure Bitcoin comes with a catch
Crypto
JPMorgan makes bullish call in fixed income space, suggests it’s a once in a generation opportunity
J.P. Morgan Asset Management is making a bullish call on an underinvested market group: high-quality fixed income.
Priya Misra, a portfolio manager at the firm, sees a once in a generation opportunity for investors.
“You can actually take credit risk in the highest quality companies and still get [a] 6.5% [yield], Misra told CNBC’s “ETF Edge” this week. “So, you actually don’t have to go down in credit [quality].”
She suggested the strategy is particularly well suited for investors concerned about having too much exposure to artificial intelligence stocks.
“There’s a huge AI exposure,” Misra said. “What fixed income gives you is this diversified set of returns. It’s not just an AI trade or a tech trade. You have the Treasury trade. You have credit outside of AI.”
Misra co-manages the JPMorgan Core Plus Bond Fund ETF (JCPB). The fund has almost $16 billion in assets under management, with just over three-quarters of its holdings in BBB-rated debt and above, according to the firm’s website as of Aug. 31.
“We’ve actually been increasing some of the double-B [and] single-B exposure because there has been a widening in high yield spread,” she said. “We like some investment grade. And now, we’ve started in the last few days to increase some duration as well, thinking we may be nearing the end of that rate move.”
The JPMorgan Core Plus Bond Fund ETF is down more than 5% so far this year as of Friday’s close, according to FactSet.
“You want to be looking bond by bond and sort of sector by sector to see where the macro and you have to do the bottom up as well to make sure that companies are not over levered,” noted Misra, who’s concerned about how higher rates could hurt the housing market.
BondBloxx co-founder Joanna Gallegos is also advising investors to take advantage of “historically attractive” yields across debt markets.
“You want to really consider getting some corporate debt into your portfolio,” Gallegos said in the same interview. “It’s really in the investor’s best interest to start looking at the income that’s back in fixed income. It can offset the volatility in your portfolio.”
Part of her bull case: Base rates are high, and they’re stable.
“The fundamentals of these corporations are so strong, and the economy continues to grow,” added Gallegos. “We really think that’s being lost in the narrative around Treasury rates.”
Her firm BondBloxx is known for fixed-income exchange-traded funds in sectors including Treasury, corporate, private credit and emerging markets.
One of its funds includes the BondBloxx Private Credit CLO ETF (PCMM). As of Friday’s close, it’s down 0.6% so far this year, according to FactSet.
Crypto
Are Firing Squad Executions Seeing a Revival in the U.S.?
Crypto
Robinhood Chain slowdown spreads from fees to trading as transactions fall 40%
Daily active addresses averaged about 322,000 in the latest week, down 31% from mid-September, suggesting fewer people, and fewer of the trading bots they run, are using the chain each day.
The drop is likely smaller in human terms than the raw number implies, since one trader can run many addresses and a single automated program can account for thousands of transactions.

Less trading, steady balances
Spot exchanges, where users buy and sell tokens directly, handled $7.45 billion during Oct. 2–8, down 21% from $9.46 billion the week before, according to CoinDesk calculations using DefiLlama. Uniswap, an app that lets people swap tokens with each other without a company in the middle, handled roughly 77% of that.
Users aren’t pulling their money out, though. Deposits in the chain’s lending and trading apps rose about 2% over the week to $1.04 billion, and the supply of stablecoins, tokens pegged to the dollar, ticked up to roughly $1.10 billion.
That suggests the pile of money is simply being traded less, with traders keeping their funds on Robinhood Chain and waiting.
Futures are the exception, however. DefiLlama’s rolling seven-day figures on Friday showed about $7.35 billion in perpetual futures volume, contracts that let traders bet on prices without owning the tokens, up 26%.
Crypto
Mashinsky Accepts Lifetime Industry Ban and Up to $35 Million in Conditional Payments | The Defiant
The New York settlement ties the money to federal forfeiture and prison-sentence conditions, adding to existing FTC and CFTC restrictions…. Read the full story at The Defiant
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Crypto
Dogecoin dips by 11% this week as whale balances shrink
Key takeaways
- Dogecoin traded near $0.085 on Friday after losing more than 11% this week.
- Two large-wallet cohorts reduced their combined holdings by 100 million DOGE since Tuesday.
- A close below $0.084 could expose $0.078 and $0.070, with resistance beginning at $0.086.
Dogecoin traded around $0.085 on Friday, approaching a key trendline area after a weekly decline of more than 11%.
Falling balances among some large holders and weakening technical momentum suggest continued downside pressure.
However, derivatives positioning offers a more mixed picture, with long positions outnumbering shorts in CoinGlass’ tracked ratio.
Large Dogecoin holders reduce exposure
Santiment’s supply distribution data shows that wallets holding between 1 million and 10 million DOGE and those holding between 10 million and 100 million DOGE have collectively reduced their balances by 100 million tokens since Tuesday.
The decline suggests some large holders are reducing exposure, potentially through profit-taking. Wallet balance changes alone do not confirm that every token was sold, but the movement adds to concerns about near-term supply pressure.
CryptoQuant’s summary indicators also point to caution. Its data identifies overheating conditions in both spot and futures markets, alongside large orders and sell-side dominance in futures.
These signals suggest that selling pressure remains significant as DOGE approaches nearby support.
Despite the price decline, CoinGlass’ DOGE long-to-short ratio stood at 0.90 on Friday, approaching its highest level in more than a month.
A reading above one indicates that longs outnumber shorts within the positions or accounts tracked by the metric.
Funding rates also remained positive at 0.0010%, meaning long traders were paying short traders to maintain their positions.
Together, the readings suggest some traders are positioning for a recovery. They do not establish that buying demand is strong enough to reverse the decline, particularly while price momentum remains weak.
DOGE tests $0.084 as momentum deteriorates
Dogecoin is trading just above the trendline area near $0.084, which serves as the immediate technical support reference.
A daily close below that level could open the way toward $0.078. A deeper correction would bring the next structural floor at $0.070 into focus.
The Relative Strength Index sits near 40, below its neutral midpoint and consistent with weaker buying momentum.
The Moving Average Convergence Divergence line remains below both zero and its signal line. Its negative, slightly expanding histogram also suggests sellers retain the near-term advantage.
DOGE remains beneath several important exponential moving averages, creating successive barriers to a rebound.

The first resistance is the 100-day EMA near $0.086. Above it, the 50-day EMA and a horizontal resistance level converge around $0.088.
Clearing those levels would help ease immediate bearish pressure. A stronger recovery would require a move above the 200-day EMA at $0.093, followed by a challenge of major resistance near $0.102.
For now, the balance between support at $0.084 and the moving averages overhead will help determine whether DOGE stabilizes or extends its weekly losses.
Crypto
Armed robbers steal $820K in crypto during luxury home raid in Thailand
Three armed men have forced a Chinese expatriate with Turkish citizenship to transfer approximately $820,000 in cryptocurrency during a robbery at his luxury home near Pattaya, Thailand, prompting a police investigation into the suspects and the movement of the stolen assets.
Summary
- Three armed men broke into a luxury home near Pattaya, Thailand, and forced a Chinese expatriate with Turkish citizenship to transfer approximately $820,000 in cryptocurrency.
- The attackers threatened the victim at gunpoint and stole cash and three luxury watches before escaping in a vehicle that police later recovered.
- Thailand police are examining CCTV footage and tracing cryptocurrency transactions to identify the suspects, whose nationalities have not been confirmed.
- The robbery follows a series of violent attacks targeting cryptocurrency holders, with Chainalysis estimating losses of more than $30 million from such incidents in the first half of 2026.
According to initial reports, the robbery took place at around 3:30 a.m. on Tuesday, October 6, inside a gated residential community in Nongprue, where the attackers entered the property using a ladder before confronting the victim in his bedroom.
The masked men reportedly threatened the resident with firearms and ordered him to open a safe containing cash and valuables. They took an undisclosed amount of money and three luxury watches before demanding access to his cryptocurrency holdings.
Under threat, the victim transferred digital assets valued at roughly $820,000 to accounts controlled by the attackers. Reports indicate that the cryptocurrency was subsequently sold, although authorities have not disclosed which assets were involved or how the transactions were carried out.
The resident eventually escaped and contacted police. His identity has not been publicly released.
Thailand police trace stolen crypto and suspects’ getaway vehicle
Police Region 2 has taken charge of the investigation, with officers examining both the physical evidence left behind and the transactions involving the stolen cryptocurrency.
Police Lieutenant General Wasan Techa-akrakesom, commissioner of Police Region 2, said investigators had made significant progress in the case. The Immigration Bureau has been brought into the investigation as authorities work to establish the identities and movements of the suspects.
Initial information suggested that the three attackers might be Chinese nationals, but police have not confirmed their citizenship. No arrests were disclosed in the initial reports.
Investigators have reportedly recovered the vehicle used by the suspects after it was abandoned in a remote location.
CCTV footage placed the same vehicle in the area on October 5, one day before the robbery. Police are examining the footage as part of efforts to reconstruct the suspects’ movements before and after the break-in.
Alongside the search for the attackers, authorities are tracing the digital assets transferred from the victim’s holdings.
Investigators are reportedly examining accounts connected to the subsequent sale of the cryptocurrency in an effort to identify the individuals who received or handled the funds.
Details about the destination wallets, exchanges involved and potential recovery of the stolen assets have not been made public.
Police have yet to establish whether the attackers knew about the resident’s cryptocurrency holdings before entering the property or discovered them during the robbery.
The distinction remains unresolved because the intruders demanded several forms of property, including cash, watches and digital assets.
Crypto wrench attacks have cost victims millions in 2026
The robbery in Thailand follows several violent incidents involving cryptocurrency holders, including home invasions where attackers have used threats or physical force to obtain access to digital wallets.
Such crimes are commonly described as wrench attacks, a term used for robberies involving physical coercion to steal cryptocurrency or force victims to authorize transfers.
In an August investigation, crypto.news previously reported that criminals had stolen more than $30 million through violent attacks against cryptocurrency holders during the first half of 2026, citing research from blockchain analytics firm Chainalysis.
The firm documented 46 incidents during the six-month period, compared with 40 in the corresponding period of 2025. Only 12 of the 46 attacks resulted in payments, giving criminals a reported success rate of 26%.
Home invasions accounted for 37% of documented cases, compared with 14% in 2025. Kidnappings represented 52% of incidents, although Chainalysis noted that some cases could involve more than one type of crime.
A separate investigation by security firm CertiK identified 52 verified wrench attacks worldwide during the first half of 2026, with financial exposure totaling $124.1 million.
CertiK’s figure included stolen cryptocurrency, ransom demands, frozen assets and other amounts connected to reported incidents. It did not represent the amount criminals successfully obtained.
The firm’s findings placed France at the top of its list, with 33 verified attacks accounting for nearly 64% of the worldwide total. Europe recorded 39 incidents, while the United States accounted for four.
Armed home robberies have targeted crypto holders in France and the US
Several recent cases have involved attackers entering residential properties and demanding cryptocurrency transfers from occupants.
In September, four masked men held a family captive for more than three hours in Vendin-le-Vieil, northern France, before forcing the father, who worked in the cryptocurrency sector, to surrender access codes linked to approximately €40,000 in digital assets.
The attackers assaulted the father, while his 12-year-old daughter was struck in the face. French authorities investigated the incident as kidnapping and extortion by an organized gang.
Earlier that month, a couple in Alès was restrained and threatened by two armed intruders who demanded cryptocurrency transactions.
The attackers reportedly carried a handgun and a knife and held the couple for more than two hours while their young child was inside the house. Neighbors alerted police after hearing screams, prompting the suspects to flee.
Similar incidents have reached US courts. In June, two Texas brothers pleaded guilty in an $8 million cryptocurrency robbery case involving a Minnesota family.
Federal prosecutors said the brothers held the victims at gunpoint for approximately nine hours while forcing them to transfer digital assets. Both pleaded guilty to interference with commerce by robbery.
Meanwhile, investigators in Thailand are examining the abandoned getaway vehicle, CCTV footage, immigration records and cryptocurrency transactions connected to the Pattaya robbery.
According toPattaya Mail’s October 9 report, officers located a black Toyota Fortuner in a wooded area and identified footage showing the vehicle near Phatthanakan Road and Soi Wat Boonsamphan at approximately 3:38 p.m. on October 5.
Police have not publicly confirmed the suspects’ identities or nationalities, and the investigation remains ongoing.
Crypto
UK Regulator Pushes Crypto Tokenisation as Next Phase of Capital Markets Overhaul
Cryptocurrency and the technology behind it are no longer a fringe curiosity for Britain’s financial regulator — they are becoming central to how the UK hopes to keep its capital markets competitive. In a speech delivered this week, the Financial Conduct Authority (FCA) made clear that tokenisation, artificial intelligence and digital assets are now core pillars of its multi-year reform programme, not side projects bolted onto traditional finance.
Jon Relleen, the FCA’s director of infrastructure and exchanges, told delegates at the Reform of the UK Public and Private Capital Markets Summit 2026 that the regulator has “been very busy” completing major elements of a long-running overhaul designed to ensure markets “work well for our economy and support growth.” Crucially, he singled out tokenisation — the process of representing traditional assets like shares, bonds or funds as digital tokens on blockchain-style infrastructure — as one of the fastest-moving frontiers the FCA is now preparing to regulate.
Why cryptocurrency infrastructure is entering the mainstream conversation
For years, cryptocurrency was treated by many regulators primarily as a consumer protection headache: a space rife with scams, volatile prices and speculative trading. The FCA’s own website still carries extensive warnings about crypto investment scams and maintains a public list of firms operating without authorisation. That caution hasn’t disappeared. But Relleen’s speech signals a parallel track, where the underlying technology of cryptocurrency markets is increasingly viewed as a legitimate tool for modernising how capital itself is raised, traded and settled.
This dual-track approach — tightening consumer safeguards while embracing the infrastructure — reflects a broader pattern seen across global financial regulation. Authorities are trying to separate the speculative trading culture that surrounds cryptocurrency from the distributed ledger technology that underpins it, betting that the latter can make markets faster, cheaper and more transparent without necessarily importing the volatility of coins like Bitcoin or Ether.
Trust and risk-taking as twin priorities
Relleen was explicit that reform cannot come at the expense of market integrity. “Trust, market integrity and high standards set the foundations for sustainable growth,” he said, while also stressing that regulators must “enable informed risk-taking.” That balancing act is especially delicate in the context of cryptocurrency-adjacent innovation, where enthusiasm for new technology has historically outpaced investor protections.
The FCA’s framing suggests it wants to avoid repeating past cycles in which cryptocurrency products were sold to retail investors with little understanding of the underlying risks, only for sharp price crashes or platform failures to follow. By building tokenisation into a broader, more deliberate reform agenda — alongside AI adoption and new markets for trading shares in private companies — the regulator appears to be trying to get ahead of the technology rather than reacting to it after problems emerge.
What reform could mean for everyday investors
For ordinary savers and investors, the practical implications of this shift may not be felt immediately, but they could be significant over time. Tokenised versions of traditional assets could, in theory, make it cheaper and faster to buy and sell investments, lower barriers to entry for smaller investors, and create new ways to trade assets that are currently illiquid, such as stakes in private companies.
At the same time, the FCA’s own consumer-facing warnings underline that cryptocurrency-linked products remain high-risk. The regulator continues to flag crypto investment scams as a priority concern and maintains tools allowing the public to check whether a firm is properly authorised before investing. Anyone tempted by new tokenised products emerging from this reform push would be wise to apply the same scrutiny long urged for conventional cryptocurrency investments: verifying authorisation, understanding volatility, and being wary of promises of guaranteed returns.
A multi-year programme nearing a turning point
Relleen described the FCA’s broader capital markets reform effort as having already completed “major aspects” of a multi-year programme, with more changes still to come. Tokenisation and artificial intelligence were named specifically as areas where markets and technology are evolving rapidly enough that regulation must adapt in real time rather than simply catching up after the fact.
This positions cryptocurrency-related innovation not as a one-off experiment but as an ongoing feature of how UK capital markets will likely operate in the coming years. Whether that translates into tangible benefits for everyday investors, or simply shifts where the risks sit, will depend heavily on how the FCA follows through on the detailed rules still to be written. For now, the message from one of Britain’s top financial regulators is unambiguous: cryptocurrency-based tokenisation has moved from the margins of policy discussion to the centre of the UK’s plan for economic growth.
Explore more on this topic with Vexel Search.
Crypto
Top Democrat among Senate investigators probes ties between Cantor Fitzgerald, Tether
“While Tether claims to operate out of El Salvador, the vast majority of its assets reside in the United States under your custodianship,” the Connecticut lawmaker wrote. “As Congress considers how to best regulate digital assets, your partnership with Tether will provide important insights into the inner workings of this industry.”
One of the letter’s many requests: “Please describe all steps Cantor Fitzgerald has taken to investigate allegations that Tether’s stablecoin has been used in illicit finance and money laundering, including within Iran’s shadow banking network and for purposes of Russia sanctions evasion.”
Neither Cantor Fitzgerald nor Tether immediately responded to requests for comment sent to their spokespeople.
While Blumenthal and other aggressive congressional critics of the crypto industry, such as Senator Elizabeth Warren, have suffered from a limited authority as members of the minority party, securing a Democratic majority for next year would change that. If they win several more seats in that chamber, they could find themselves atop committees with subpoena power to legally compel information and testimony.
As it stands, the prediction markets suggest that Democrats have a better-then-even shot at returning to the majority. Kalshi has it at 61% and Polymarket at 64%. That number was closer to 50-50 several weeks ago. And the picture in the U.S. House of Representatives is even more positive for Democrats, with both platforms showing the likelihood of a majority shift at more than 90%.
Crypto
ESMA gives EU crypto platforms 3 months to drop non-MiCA stablecoins such as USDT
The guidance said authorized crypto firms must stop offering services that let EU customers buy, trade, swap or otherwise increase their holdings of affected stablecoins.
The rules cover exchange services, trade execution, transfers, custody, administration, advice and portfolio management.
National regulators should require any remaining customer holdings to be resolved “as soon as possible, and no later than three months” after the opinion’s publication, ESMA said. That places the deadline at Jan. 8, 2027.
In the meantime, platforms may provide limited services to resolve existing holdings. These can include selling, converting, withdrawing, transferring or safekeeping tokens, but not purchases, promotion, trading or continued market availability.
EU users who keep USDT on an exchange will have to follow that platform’s instructions. Some may be able to sell or withdraw it during the wind-down period; others may face an earlier cutoff.
ESMA said keeping noncompliant stablecoins available through authorized platforms would weaken the reserve, redemption, governance and disclosure rules MiCA imposes on authorized issuers.
The opinion is directed at national regulators, who will decide how individual platforms handle their remaining client balances within the three-month outer limit.
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