Crypto World
Analyst warns traders pricing in TACO trade could face a rude awakening
Traders are underestimating how deeply the current conflict in the Middle East could reshape the macro backdrop, with some positioning around a so‑called “TACO trade”—short for “Trump always chickens out”—dominating chatter in crypto and broader markets. Nic Puckrin, founder of Coin Bureau, popularized the term to describe a supposed tendency for U.S. leadership to back away from geopolitical flare‑ups. But he cautions that the situation is far more intricate than a single decision by any one leader, and there are no quick exits from a widening conflict.
Oil prices have become a central barometer for the scenario. If crude stays above $100 per barrel, growth in the United States could slow while Personal Consumption Expenditures inflation rises, potentially by as much as one percentage point, according to Puckrin. That dynamic would complicate the Federal Reserve’s already delicate task of steering policy in an environment where inflation remains persistent and growth is uncertain. The risk of stagflation—the painful combination of rising prices with weak growth and employment—emerges as a real possibility if energy costs stay elevated through the second and third quarters.
Key takeaways
- Oil could stay a decisive driver: Sustained prices above $100 per barrel threaten growth and lift inflation in tandem, increasing stagflation risk.
- The TACO trade is not a guaranteed play: While the term captures a belief in limited appetite for geopolitical escalation, experts warn that policymakers and markets should expect a more complex, drawn‑out conflict with no easy exit.
- Strait of Hormuz disruption compounds the risk: Prolonged disruption through the vital chokepoint raises the energy price floor and feeds into broader inflation dynamics.
- Policy path remains uncertain: The Fed held rates at 3.5%–3.75%, with market odds of a near‑term cut fading and a non‑zero probability (about 12%) of a rate increase at the next meeting.
- Crypto and risk assets face a nuanced outlook: Higher energy costs and uncertain monetary policy can dampen liquidity for risk assets, even as some traders seek hedges or tactical exposure.
Oil shocks, chokepoints, and the market’s fragile balance
The incoming energy data and geopolitical risk have pushed crude higher in recent sessions, with WTI briefly touching the high‑end of the $110s and flirting with $120 per barrel as the conflict widened. The persistent tension around the Middle East has intensified concerns that global supply flows could be constrained if oil infrastructure faces sustained disruption. Market observers point to the Strait of Hormuz as a pivotal artery—through which a sizable portion of the world’s oil shipments pass—and note that any sustained closure or damage could push prices higher for an extended period.
Analysts emphasize that even a reopening of maritime routes would not instantly restore pre‑crisis conditions. “Disruption to the Gulf’s oil-producing infrastructure will take months to rebuild,” one commentator noted, underscoring the slow‑burn impact on prices and the broader economy. The energy price surge feeds through to a wide array of goods and services, often lifting inflation broadly rather than affecting a single sector in isolation. In such a regime, inflationary pressures can push the real cost of living higher while limiting the central bank’s ability to loosen financial conditions quickly.
Beyond the immediate supply shock, energy is a fundamental input into nearly all economic activity. When energy costs rise, every sector faces higher costs, and central banks can find themselves juggling the risk of inflation against the imperative to support growth. The macro calculus becomes especially delicate if markets price in a persistent energy premium that persists through the next several quarters, complicating any hopes of an early, policy‑driven risk‑on rally for crypto and other speculative assets.
Policy uncertainty and the Fed’s calculated stance
The Federal Open Market Committee’s decision to hold the Federal Funds rate at 3.5%–3.75% in March reflected a cautious stance in the face of renewed energy‑driven inflation risks. Market observers say that near‑term rate cuts have faded from the central scenario, while a minority of traders assign a non‑negligible probability to a rate move higher in the near term, as reflected by the CME Group’s FedWatch tool, which placed the odds of a hike at around 12% for the next meeting.
Fed Chair Jerome Powell acknowledged that the economic implications of the Middle East conflict are unclear in the near term. Speaking at a press conference, he stressed that while energy prices are a potential drag on inflation and growth, it is still “too soon” to accurately gauge the full scope of the disruption’s impact on the broader economy. The central bank’s ongoing assessment will hinge on incoming data, including energy price trajectories, inflation readings, and indicators of domestic demand.
Measured against today’s macro backdrop, the risk premium for risk assets, including crypto, could be influenced by how energy costs evolve and how quickly monetary policy adapts. If energy prices remain elevated and inflation proves more persistent than anticipated, the Fed may lean toward a tighter stance for longer, which could constrain liquidity in markets and temper speculative appetites. Conversely, any signs of cooling inflation or a surprise easing in market stress could renew expectations for looser policy and a more favorable environment for higher‑beta assets.
What readers should watch next
Investors should monitor three interconnected threads in the coming weeks: first, the trajectory of global oil prices and the duration of any supply disruptions through strategic chokepoints; second, the evolving assessment of inflation and growth signals that inform Fed policy; and third, how sentiment around geopolitical risk interacts with liquidity conditions in crypto markets. With the energy‑inflation nexus likely to dominate near‑term headlines, traders would be wise to differentiate between narrative positioning and data‑driven developments as markets digest the evolving risk landscape.
In this environment, the market’s reflex to geopolitical risk could remain biphasic: periods of reprieve followed by renewed volatility as new information emerges about the conflict’s scope, energy infrastructure resilience, and policy responses. Keep an eye on energy price momentum, central bank communications, and liquidity signals across major crypto and traditional risk assets to gauge where the next phase of the cycle may lead.
Covenant AI, a developer operating on Bittensor’s subnet ecosystem, announced on Friday that it is leaving the decentralized AI network, accusing governance of not being meaningfully distributed and questioning whether the project can sustain its decentralization claims. In a post on X, Covenant AI founder Sam Dare said the team could no longer build on or raise for Bittensor because governance wasn’t truly distributed. “It is decentralization theatre,” Dare wrote, alleging that Jacob Steeves—known as Const—maintains effective control over the governance triad, resists meaningful transfers of authority, and deploys changes unilaterally without process or consensus.
The dispute centers on the core selling point of Bittensor: true decentralization. Covenant AI contends that Steeves wields outsized influence over governance and network operations, an accusation Steeves has denied. Bittensor describes its governance as a transitional framework, featuring a “Triumvirate” of Opentensor Foundation employees alongside a senate, rather than a fully open, fully distributed model. The company’s documentation frames this as a staged approach rather than a completed, decentralized system.
Key takeaways
- Covenant AI is exiting Bittensor, publicly challenging the project’s claim of decentralization and accusing governance of concentrated power under a Triumvirate-led structure.
- The core accusation centers on control over governance and network operations, with Covenant AI alleging unilateral decision-making and resistance to meaningful authority transfers.
- In response, Bittensor founder Jacob Steeves denies suspending subnet operations or granting special privileges, and says dissenting actions are either mischaracterized or misinterpreted—he also contends that certain token-related moves were ordinary market activity visible on-chain.
- The dispute has coincided with a material move in TAO’s price and trading volume, reflecting broader investor attention as the governance rift unfolds.
Governance under the lens: what changed and what stayed the same
The heart of Covenant AI’s claim is that the governance design of Bittensor—ostensibly built to be open and composite—operates in practice as a closed system. Covenant AI argues that the Triumvirate, comprising key Opentensor Foundation figures, plus a senate, retains root permissions and can steer network modifications without broad consensus. Dare framed the arrangement as incompatible with the decentralization narrative that attracted builders and financiers to the project, suggesting that the structure undermines the very premise of distributed governance.
Steeves, for his part, pushes back on the description of centralized control. In his public responses, he argued that he does not wield privileges beyond those of ordinary TAO token holders and that he cannot suspend subnet emissions. He also contends that any large token movements he has executed were disclosed through on-chain activity and thus transparent to the community. In a Friday X post, Steeves responded to Covenant AI’s claims by stating he had liquidated some of his “alpha holdings” on subnets that were not actively running or were on burn-heavy code, asserting that such actions alter emissions in a manner consistent with typical market dynamics on Bittensor.
Nevertheless, Covenant AI asserts that governance friction has tangible effects on project momentum. Emissions controls and moderation rights are among the specific levers cited as evidence of centralized influence, with Covenant AI describing moves as attempts to pressure or stifle the subnet’s development trajectory. Steeves counters by noting that moderation permissions were temporarily restricted and later restored, and he emphasizes that changes in on-chain token economics would be visible to observers. He also argues that his actions fall within the rights of token holders and do not amount to a covert governance coup.
Market signals and on-chain behavior amid the dispute
The governance dispute has spilled into market sentiment around TAO, Bittensor’s native token. TAO’s price had been under pressure, slipping roughly 18% over the preceding 24 hours as of Friday morning in market data cited by Cointelegraph. The selling momentum intensified in the day leading up to Covenant AI’s departure announcement, with on-chain sell volume hitting a level not seen since December 2024. Analysts framed the price and flow dynamics as a potential reflection of investors adjusting exposure to a project undergoing a governance upheaval.
External observers echoed the sense that the departure could be more than a PR dispute. One crypto analyst noted on X that the timing and scale of Covenant AI’s exit appeared deliberate, describing it as a calculated move rather than a coincidence. While market dynamics can be noisy, the episode underscores how governance tensions in decentralized projects can translate into tangible liquidity and price reactions, particularly when a builder with an active subnet exits.
Cointelegraph sought comment from Covenant AI and Bittensor for responses to the evolving narrative but did not receive official remarks by publication time. The broader market context remains relevant: governance design that emphasizes decentralization is increasingly scrutinized as multiple teams seek to attract talent and funding without compromising core distributed principles. The exchange between Covenant AI and Steeves—along with on-chain activity tied to token emissions and governance permissions—provides a live case study in how decentralization ambitions interact with practical governance controls.
Broader implications for decentralization in practice
Industry observers note that the Covenant AI episode highlights a broader, ongoing debate about the practical meaning of decentralization in long-running blockchain and Web3 projects. David and Daniil Liberman, co-founders of the Gonka protocol, described a tension that will resonate with builders across ecosystems: if a project’s infrastructure can be used against it because control rests with a concentrated subset of actors, does the model remain genuinely decentralized? Their assessment emphasizes the need for governance that can withstand complex, real-world pressures without becoming opaque or inert in the face of conflicts between contributors and governance stewards.
The debate also harks back to earlier public moments in Bittensor’s story. For instance, Nvidia CEO Jensen Huang publicly celebrated Covenant AI’s milestone in training a decentralized large language model on Bittensor Subnet 3, calling it a remarkable technical achievement. That historic spotlight contrasted with the current governance friction, illustrating the dual aspects of decentralization narratives: the technical frontier that attracts builders, and the governance framework that must sustain it without central choke points.
As the community digests the tensions, readers should watch for how Bittensor’s governance documents evolve and whether any reforms are pursued to broaden participation or formalize oversight. The resolution, or lack thereof, will influence not only Covenant AI’s future on the network but also how other builders evaluate the feasibility of heavily multi-party, permissioned decentralization models in practice. Observers will be mindful of potential new on-chain disclosures, governance proposals, or changes to subnet permissions that could redefine participation rules for developers and token holders alike.
In this moment, the core question remains: can a decentralized AI network reconcile rapid innovation with a governance framework that remains genuinely open to diverse contributors, or will episodes like Covenant AI’s departure redefine decentralization as a continuous negotiation between ambitious builders and centralized control points?
What to watch next: keep an eye on any updates to Bittensor’s governance structure, changes in subnet emission policies, and new participation rules for subnets. The outcome will influence how other multi-stakeholder networks balance openness with accountability, and it will shape investor sentiment around projects that promise decentralization as a core value proposition.
Crypto World
Volatility compression grips crypto markets ahead of U.S. inflation report: Crypto Markets Today
The crypto market held steady on Friday, with bitcoin trading little changed at $71,700 and ether (ETH) at $2,180, extending the low-volatility price action that has characterized the past few months.
Daily Bollinger bands, a technical analysis tool that measures market volatility, are at their narrowest since early 2024. In the past, such a tight range — bitcoin has held between $63,000 and $75,000 since early February — has ended with a 40% move in price, according crypto analyst Eric Crown.
A breakout above $75,000 in bitcoin’s case would trigger upside momentum by trapping traders who are short and need to buy at market prices to cover their positions, while a short-term move below $70,000 will liquidate around $200 million worth of long positions that are betting on the breakout, according to CoinGlass’ liquidation heatmap.
One key catalyst on Friday will be the U.S. consumer price index (CPI) data. March inflation is estimated at 3.3% year-on-year, driven by surging energy prices. High inflation figures tend to spur upside price action in the U.S. dollar, which could weigh on risk assets like bitcoin.
Derivatives positioning
- Open interest (OI) in bitcoin futures increased by 1%, with average perpetual funding rates on major exchanges at their highest since Feb. 4. This shows a strengthening investor appetite for bullish exposure.
- Other major cryptocurrencies were mixed. OI increased slightly in XRP (XRP) while holding flat in ether (ETH) and solana (SOL). HYPE and AVAX are other standouts, displaying a bullish combination of OI growth and positive funding rates.
- The privacy-focused ZEC, meanwhile, shows OI growth and negative rates, a sign that traders are continuing to short futures and hedge downside risks even as the spot price rallies. ZEC’s price rose to nearly $400, the highest since Jan. 28.
- There seems to be no end to the downtrend in BTC’s 30-day implied volatility index, BVIV. The measure has slipped to 45%, indicating market calm. It has dropped in a near-straight line from 58% on March 31. Ether’s volatility index shows a similar pattern.
- The decline in volatility is largely led by ETF-related flows. “The ETF complex has created a feedback loop: institutions sell calls for yield, which suppresses upside vol, which makes selling more calls even more attractive. The impact is still subtle, but the direction of travel is clear. Bitcoin’s options market is maturing into a structurally skewed market, just like equities,” STS Digital’s CEO Maxime Seiler told CoinDesk.
- The implied volatility term structure is flat for the next six months and then rises from September, suggesting the market is prepping for a quiet few months in between.
- On Deribit, BTC and ETH options continue to display put skews, although it’s much weaker than a week ago as traders chase upside bets, particularly the BTC call option at the $80,000 strike.
Token talk
- CoinDesk’s DeFi Select Index (DFX) is the best-performing benchmark on Friday, rising by 0.38% while the bitcoin-dominant CoinDesk 5 (CD5) is down by a quarter of a percent.
- The CoinDesk Computing Select Index (CPUS) is the worst performer, losing 1.4% after it was dragged down by bittensor (TAO), which lost more than 12% since midnight UTC after Covenant AI, one of the network’s largest subnet developers, said it was leaving Bittensor.
- “The entire premise of Bittensor, the promise that drew builders, miners, validators, and investors into this ecosystem, is that no single entity controls it,” Covenant AI founder Sam Dare wrote on X. “That promise is a lie.”
- One token that shrugged off broader crypto market apathy was DASH, which surged more than 19% since midnight UTC, contributing to a 24-hour gain of 34% as traders rotated back into the privacy sector.
The Japanese government amended the Financial Instruments and Exchange Act on Friday to classify crypto assets as financial instruments.
The amendment also bans insider trading and other activities that involve buying and selling based on undisclosed information, Nikkei reported.
The amended act will also now require cryptocurrency “issuers” to be more transparent and disclose information once a year.
Japan’s Financial Services Agency has previously regulated crypto assets under the Payment and Settlement Act, citing their potential use as a means of payment. However, the regulations and classifications have been updated to reflect increasing institutional investment in the asset class.
By reclassifying crypto as a financial instrument rather than just a payment method, Japan is moving crypto out of the experimental payments category and into the same league as its stock market.
Crypto under the TradFi umbrella
“We will expand the supply of growth capital in response to changes in financial and capital markets, and ensure market fairness, transparency, and investor protection,” said Finance Minister Satsuki Katayama at a press conference after the Cabinet meeting.
Fines and sentences for unregistered crypto exchanges have also increased under the amendment.
Related: Prediction markets are testing legal limits in strict Asian markets
Japan signaled that it was bringing crypto under the same umbrella as traditional finance in January when Katayama said, “To ensure citizens benefit from digital and blockchain-based assets, the role of exchanges and market infrastructure will be essential.”
The government backed plans in December to significantly reduce Japan’s maximum tax rate on crypto profits, with a flat rate of 20% across the board.
Crypto ETFs coming to Japan
Japan is also planning to legalize crypto exchange-traded funds (ETFs) by 2028, marking a major shift toward mainstream crypto adoption, according to a January report.
Major financial groups, including Nomura Holdings and SBI Holdings, are among the first companies expected to develop crypto-linked exchange-traded products.
Asia Express: Phantom Bitcoin checks, China tracks tax on blockchain
A New York judge couldn’t decide yesterday whether or not to acquit Tornado Cash co-founder Roman Storm on conspiracy charges relating to his role in the creation of the non-custodial crypto mixer.
Storm was convicted last year of conspiracy to operate an unlicensed money transmitting business, however, a jury was unable to come to a decision on more serious conspiracy to launder money and conspiracy to evade US sanctions charges.
As such, the question of whether or not to acquit Storm fell to Judge Katherine Polk Failla.
“This is a lot,” she said after hearing arguments from both Storm’s defence and government prosecutors.
As reported by The Block, Storm’s defence argued that Tornado Cash is legal, and that his work to update and maintain his legal business used by ordinary people doesn’t make him guilty of abetting the criminal money launderers who also use it.
General Counsel of Solana Policy Institute, Patrick Wilson, called this expansive claim “alarming,” and noted that, “Once criminals use a noncustodial tool at sufficient (though unspecified) scale, even otherwise lawful activity can be recast as illegitimate.”
Government prosecutors argued, however, that his work means he not only helped but profited from money launderering. One prosecutor caused a brief stir in the courtroom after implying that anyone whose funds were mixed with criminal funds via Tornado Cash may also be liable.
The CEO of the DeFi Education Fund, Amanda Tuminelli, attended the hearing and claimed that the government “still does not understand the tech at issue.”
Read more: Ethereum dev arrested in Turkey ups Roman Storm donation to $500K
“The lack of nuance, the misrepresentations about how a UI functions, and the equivocation between different technologies is really disheartening at this point in the case,” she said.
“It was good to see the judge digging in and asking detailed questions, but there is no way to predict how she will rule on Storm’s motion. Given that she was focused on dates for retrial at end of 2026, I think we can expect to see the case continue,” Tuminelli added.
The Rage reports that the topic of the First Amendment was barely touched upon, as well as the subject of unlicensed money transmission. The choice of New York as the venue was debated, however.
The prosecution claimed that the location of a Tornado Cash hacker, investors, and an attorney acting on behalf of a hacked crypto exchange, are all based in New York. Storm’s defence hit back, claiming that the investor’s funding was irrelevant and that the hacker didn’t use Tornado Cash for illegal purposes.
Prosecutors further claimed that an Ethereum cloud service used by Tornado Cash, which used a Manhattan bank, also constituted a New York venue.
Storm’s defence argued, however, that the payments to this cloud service cannot constitute an act aiding criminal conspiracy.
Roman Storm faces an October retrial
After last year’s trial, Storm filed for a pre-trial motion under Criminal Rule 29 that would acquit him on all counts.
His defence argues that the prosecution’s evidence wasn’t legally sufficient, and claims that, if his acquittal isn’t granted, the government “would criminalize the publication of decentralized software in violation of the first amendment.”
Read more: Roman Storm says he’s been ‘financially cancelled’ after payroll firm axe
Government prosecutors have requested that a retrial be scheduled for October so that the two remaining charges can be decided upon.
Storm currently remains free on a $2 million bail.
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Quick Summary
- Tesla’s Q1 2026 electric vehicle deliveries reached 358,023 units, falling below analyst projections of 370,000.
- Shares have declined 23% in 2026 and are approaching their eighth consecutive weekly decline.
- The automaker manufactured 408,300 vehicles while delivering only 358,023, resulting in an unprecedented inventory surplus.
- Derivative trading patterns that historically bolstered share prices have weakened throughout 2026.
- Wall Street forecasts Tesla will experience negative free cash flow exceeding $6 billion during the current year.
Tesla’s first quarter 2026 delivery figures came in below expectations, accompanied by a concerning accumulation of unsold vehicles.
The electric vehicle manufacturer reported deliveries of 358,023 units during the opening quarter, undershooting analyst consensus of 370,000. While this represents a nominal 6% increase compared to the first quarter of 2025, that baseline itself reflected a 13% year-over-year decline, making the comparison less meaningful.
Tesla manufactured 408,300 vehicles during the three-month period while delivering 358,023 units. This differential of approximately 50,000 vehicles marks the company’s largest ever accumulation of unsold inventory.
JPMorgan analyst Ryan Brinkman highlighted the inventory accumulation as a significant drain on free cash flow, noting that undelivered vehicles consume capital until they reach customers.
Cash Flow Challenges Mount
The situation is complicated by timing factors. Tesla increased its capital expenditure forecast to $20 billion for 2026, a substantial jump from $8.5 billion spent in 2025. The majority of this investment targets artificial intelligence infrastructure and humanoid robotics manufacturing.
Wall Street analysts compiled by Visible Alpha project Tesla will generate negative free cash flow surpassing $6 billion in the current year, followed by additional negative cash flow exceeding $1.2 billion in 2027.
William Blair analyst Jed Dorsheimer noted “global EV demand ex-China remains under pressure,” suggesting that Tesla is “actively sacrificing its EV business in favor of a fully autonomous future.”
Market headwinds extend beyond Tesla. Intensifying competition, tariff policies from the Trump administration, and the elimination of the $7,500 federal electric vehicle tax credit have dampened demand throughout the sector.
The Model 3 and Model Y accounted for 97% of total Q1 deliveries, underscoring the company’s continued dependence on these two product lines.
Derivative Market Activity Weakens
Beyond fundamental factors, technical market dynamics have shifted. GLJ Research analyst Gordon Johnson has monitored options market activity surrounding Tesla and observed that retail investors have reduced aggressive call option purchasing in 2026.
Historically, substantial call buying compelled market makers to hedge positions by acquiring shares. This purchasing activity generated what market participants term a “gamma squeeze,” creating a self-reinforcing cycle that elevated share prices independent of underlying business performance.
Johnson contends this technical support mechanism has diminished, exposing the stock more directly to fundamental performance. He maintains a Sell rating with a $25.28 price target—significantly below consensus estimates and representing a contrarian position.
Nevertheless, his analysis of options market dynamics provides relevant insight into technical influences.
Entering Friday’s session, Tesla traded at $344.82 during premarket hours, declining approximately 0.2%. The stock currently trades at roughly 170 times projected 2026 earnings.
Full-year 2025 deliveries totaled 1.64 million units, down from 1.79 million in 2024.
Bittensor subnet developer Covenant AI said Friday that it is leaving the decentralized artificial intelligence network, accusing Bittensor of operating under a concentrated governance structure that undermines its decentralization claims.
In a Friday post on X, Covenant AI founder Sam Dare said the team could no longer build on or raise for Bittensor because its governance was not meaningfully distributed.
“It is decentralization theatre,” Dare said. “Jacob Steeves maintains effective control over the triumvirate, resists any meaningful transfer of authority, and deploys changes unilaterally whenever he chooses, without process and without consensus.”
The dispute cuts to the core of Bittensor’s decentralization pitch. Covenant AI alleged that founder Jacob Steeves, known as Const, exerts outsized influence over governance and network operations, an accusation Steeves denied.
Bittensor’s governance documents describe a transitional system in which a “Triumvirate” of Opentensor Foundation employees holds root permissions alongside a senate, rather than a fully open governance model.
Covenant AI claims subnet emissions were suspended, Bittensor founder denies allegations
Covenant AI said Steeves had taken several actions against the project in recent weeks, including suspending emissions to its subnet, restricting moderation powers in community channels and applying “direct economic pressure” through visible token sales during the dispute.
Steeves rejected the allegations, claiming that he cannot suspend subnet emissions and that he does not hold “any privilege beyond what normal TAO holders have.”
In a Friday X response, Steeves said he sold some of his “alpha holdings on his three subnets because they were not running and were on near 100% burn code,” which changed the emissions the same way “all buys and sells on Bittensor do.”
Steeves also denied stripping Covenant AI of its moderation rights, saying he only temporarily removed the team’s ability to delete posts before restoring it. He added that large token sales would have been visible onchain.
“Less than 1% of what i had invested in his teams. Visibility is impossible to avoid in my position. I reserve my right to buy and sell tokens which is what underpins the entire system of dTao,” he added.
Bittensor previously garnered mainstream attention after Nvidia CEO Jensen Huang praised the decentralized training run on Bittensor Subnet 3, calling Covenant’s milestone of pre-training the largest decentralized LLM a “remarkable technical achievement,” during the All-In Podcast on March 19.
Related: Bittensor’s TAO price may plunge 40% within five weeks: Fractal data
TAO’s sales volume skyrockets ahead of Covenant AI’s departure announcement
The governance dispute also weighed on Bittensor’s (TAO) token, which was down around 18% over the previous 24 hours as of Friday morning, according to market data.
However, sell volume on TAO rose to its highest level since December 2024, about 24 hours before Covenant AI announced its departure. “If you think that’s a coincidence, you don’t understand the game you’re playing. This was a calculated exit and execution,” wrote crypto analyst Ardi in a Friday X post.
Cointelegraph reached out to Covenant AI and Bittensor for comment but had not received a response by publication.
The dispute raises wider concerns for projects striving for decentralization, according to David and Daniil Liberman, co-creators of the decentralized layer-1 blockchain Gonka protocol.
“Decentralized networks that want serious builders have to answer one question: can the infrastructure you build on be used against you? If the answer is yes, the decentralization is cosmetic,” they told Cointelegraph.
Magazine: Michael Heinrich loves AI coins Goat, Turbo & Aethir… but not TAO
- Toncoin whales have accumulated over 189,700 TON in three months.
- Heavy accumulation comes as TON activates the Catchain 2.0 upgrade.
- TON price rose to intraday highs of $1.32, could eye $1.89-$2.40 next.
Toncoin (TON), the cryptocurrency token of the Telegram-supported TON Blockchain, is trading higher on the day amid signs of renewed investor interest.
On Friday, the Toncoin price hovered at $1.30 as large holders, or “whales,” scooped up more tokens. The accumulation comes amid a tentative broader market recovery.
Toncoin price tests $1.30 zone amid whale accumulation
Toncoin’s price has climbed 4% in the past 24 hours, hovering near the critical $1.30 resistance zone.
The token reached an intraday high of $1.32 during the Asian trading session.
Buyers helped push trading volume up, with the metric spiking 104% as of writing to $160 million, marking a 45% increase from the previous day’s average.
This uptick arrives as Bitcoin holds above $71,000 amid bets on a new leg to $80,000.
Notably, TON’s momentum aligns with this backdrop, particularly as the network’s 100 largest whale addresses have collectively scooped up an additional 189,730 $TON over the past three months.
This accumulation persists despite broader market headwinds.
Analysts at Santiment highlighted what’s likely bullish in a post:
“Even with the #29-ranked coin in crypto losing two-thirds of its market cap since its local top in early August 2025, this heavy accumulation is a promising sign that a relief rally may come quickly once crypto markets finally turn the page from this bear cycle.”
Whale activity often points to fresh confidence in a project, and the aggressive buying shows interest in Toncoin’s underlying ecosystem.
The token is tied to the Telegram-integrated TON blockchain, which continues to expand through decentralized applications and mini-apps.
TON price is looking to bounce higher as the community cheers the Catchain, an upgrade designed to boost network throughput and block processing capacity.
In a post on X, Telegram CEO Pavel Durov commented on how bullish this upgrade is for Toncoin, noting that it marks the first step in a 7-stage Make TON Great Again (MTONGA) vision.
The TON blockchain just got upgraded and is now 10× faster.
Block rate increased 6×.
Transactions are now instant, subsecond.
This was step 1 of 7 to Make TON Great Again (MTONGA).
Next step: cut the already low transaction fees by 6×.
— Pavel Durov (@durov) April 9, 2026
What’s next for Toncoin price?
Such large-scale buying often precedes price reversals, as these investors position for potential rebounds.
Toncoin’s technical picture indicates that the price remains entrenched in a downtrend that began in June 2025, when it peaked above $8.20.
Persistent selling has resulted in a 84% decline in its value.
Bulls are not out of the woods yet, but a decisive break above $1.35 could ignite fresh upside momentum.
In this case, a potential target in a fresh rally would be the next resistance cluster around $1.89-$2.00. Significant supply pressure could follow at $2.40, an area of prior profit-taking deals.
Conversely, if sellers regain control, primary support levels beckon at $1.15.
A drop below $1.00 could accelerate selling toward $0.85, the multi-month low.
Key takeaways
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Impersonation scams can be low-tech yet highly effective, using fake websites that closely mimic trusted cryptocurrency platforms to deceive users.
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The CoinDCX case shows how a 7.16 million rupee fraud complaint escalated into legal action before it was identified as an impersonation case.
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The fake domain coindcx.pro, not the real platform, was used to mislead the victim and carry out the fraud.
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Scammers built a complete fake ecosystem using websites, Telegram channels and social media to create credibility.
While coverage of the cryptocurrency industry often focuses on market volatility, smart contract vulnerabilities and shifting government policies, some serious threats are remarkably low-tech. Deception often wears a familiar face. A fraudulent website that perfectly mirrors a legitimate exchange can cause both financial and reputational damage.
The CoinDCX impersonation incident is a stark case study of this pattern. What began as a 7.16 million rupee ($77,000) fraud complaint eventually escalated into police proceedings against the exchange’s leadership. However, the court’s intervention ultimately shifted the blame away from the actual platform, revealing that the culprit was a sophisticated digital facade operated by scammers.
A fake CoinDCX, but a real complaint
The case originated from a complaint filed by a 42-year-old insurance consultant based in Mumbra, a suburb in the Thane district within the Mumbai metropolitan region. The complainant alleged that he had been defrauded of about 7.16 million rupees. During the scam, he believed he was dealing with CoinDCX, which was presenting investment opportunities to him.
The offer allegedly included assurances of 10% to 12% monthly returns and references to a crypto franchise-style model linked to the platform. These elements, namely the promise of high returns and the apparent legitimacy of the brand, formed the core of the alleged fraud.
What sets this case apart is what happened next. Instead of being identified as an impersonation scam, the complaint escalated into legal action that led to the arrest of the company’s co-founders, Sumit Gupta and Neeraj Khandelwal.
The role of coindcx.pro in this case
Central to the incident was a counterfeit website, coindcx.pro, which the victim interacted with instead of the real CoinDCX website, coindcx.com.
Such fake domains are a common method in impersonation scams. They appear visually similar, seem trustworthy and deliberately exploit the brand’s established credibility.
According to statements issued by CoinDCX, no money connected to this matter was processed through its exchange systems. The scam did not originate within the platform itself. Instead, external actors allegedly used its name and reputation as bait.
Did you know? Domain impersonation scams often use subtle tricks, such as replacing letters, for example “o” with “0,” or adding extra words, to make fake websites nearly indistinguishable from real ones at a glance.
How the fraudsters built a fake ecosystem
The impersonation reportedly extended well beyond a single domain. The scammers also built supporting infrastructure, such as Telegram channels and social media accounts, to reinforce the illusion of legitimacy. This reflects a broader trend in crypto scams today, where perpetrators no longer rely on a single deceptive element but instead build an entire parallel ecosystem.
For the victim, this setup created a seamless and consistent experience: a website, an associated community and representatives, all seemingly connected to a recognized brand.
How the case escalated
The complaint was filed at the Mumbra police station in Thane on March 16, 2026. As the investigation progressed, CoinDCX’s co-founders were taken into custody in Bengaluru.
This turn of events highlights a key complexity in impersonation cases. When victims mention a prominent company in a complaint, it can take time to distinguish genuine involvement from misuse of the brand name. In fast-moving investigations, this lack of clarity can sometimes lead to action against legitimate companies before all the facts are established.
The case reached a critical stage when it came before a Thane magistrate court. The court granted bail to CoinDCX’s co-founders and noted that no prima facie case had been established against them. It observed that the complainant had been deceived by individuals impersonating the company’s promoters, not by the company itself. The victim also admitted having had no interaction with the company’s co-founders.
Did you know? Cybercriminals often buy expired or similar-looking domains in bulk, enabling them to launch multiple fake versions of a popular crypto platform within hours once a scam template proves effective.
A wider pattern of fake domains
The CoinDCX case is not an isolated incident.
According to the company, it reported more than 1,200 fake websites impersonating its platform between April 2024 and January 2026. This suggests that, for fraudsters, impersonation is not a sporadic tactic but a scalable strategy.
CoinDCX also stated that the first information report (FIR) filed against its co-founders was false.
Creating a domain that closely mimics a well-known platform is relatively inexpensive. When combined with messaging apps and social media, it allows fraud networks to recreate an appearance of trust at scale.
Why high monthly returns remain a key trigger
A central feature of the alleged scam was the promise of 10% to 12% monthly returns.
Such claims are a common element in financial fraud. In the cryptocurrency space, they are often paired with urgency, exclusivity or an association with a recognized platform.
From a behavioral perspective, these promises serve two key roles:
In many cases, the perceived legitimacy of the brand helps overcome doubts that might otherwise arise from the unusually high returns.
Did you know? Many impersonation scams reuse the same scripts and layouts across different brands, allowing a fake site built for one exchange to be repurposed for another within days.
Legal and reputational fallout of the CoinDCX incident
Although the court found no case against CoinDCX’s co-founders, the incident highlights the wider consequences of impersonation scams.
For companies and their executives, such events can result in:
For users of any exchange, seeing it associated with negative news can be unsettling. Those who have invested through the platform may fear financial loss. Even when a recovery process exists, few would want to become involved in a difficult and often lengthy procedure.
The case also raises important questions about how law enforcement handles digital impersonation, where identities can be replicated far more quickly than they can be verified.
CoinDCX’s response
In the aftermath of the incident, CoinDCX announced a 100 crore rupee ($10.76 million) initiative called the Digital Suraksha Network (DSN), focused on fraud prevention and user awareness.
The reported measures include:
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An AI-driven WhatsApp helpline
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APIs for sharing fraud-related data
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Collaboration with law enforcement for training and improved response
While these steps cannot completely eliminate the risk of impersonation, they reflect a move toward more proactive defense and stronger coordination across the ecosystem.
What users should take away
The CoinDCX impersonation case offers several practical lessons:
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Verify domains carefully. Even minor variations can indicate a fraudulent site.
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Be cautious of promises of fixed or unusually high monthly returns.
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Treat Telegram groups and social media handles as unverified unless they are officially confirmed.
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Ensure that all transactions are conducted only through official platforms.
In many cases, the difference between a legitimate service and a scam is not advanced technology but careful verification.
Crypto World
ServiceNow (NOW) Stock Plunges Nearly 8% Amid Geopolitical Chaos and AI Disruption Concerns
Key Takeaways
- ServiceNow (NOW) shares plummeted approximately 7.86% on Friday, April 10, 2026, settling near $89.81.
- Renewed Middle East conflict following a ceasefire breakdown sparked widespread market anxiety and contributed to the decline.
- Anthropic unveiled Managed Agents, fully autonomous AI tools capable of handling complex workflows, sparking concerns over traditional SaaS model obsolescence.
- Famed short seller Michael Burry briefly posted (then removed) commentary suggesting Anthropic poses a competitive threat to Palantir, amplifying SaaS sector concerns.
- Year-to-date, NOW has declined 38.3% and currently trades 56% beneath its 52-week peak of approximately $211.
ServiceNow (NOW) faced a brutal trading session Friday, with shares collapsing nearly 8% to close around $89.81 as twin headwinds slammed the enterprise software provider in an already shaky market environment.
SaaS investors endured a particularly punishing day across the board.
The initial pressure originated from geopolitical developments. News emerged of a ceasefire violation in the Middle East, sparking renewed investor anxiety and triggering broad risk-off sentiment. This stood in stark contrast to the situation just ten days prior, when NOW had rallied 6.2% following President Trump’s comments about constructive diplomatic engagement with Iran. Friday’s session wiped away most of those gains.
The second blow struck more directly at ServiceNow’s core business model. Anthropic rolled out Managed Agents, a new class of autonomous artificial intelligence systems designed to execute sophisticated, multi-stage workflows independently. Market participants viewed this development as potentially disruptive to conventional SaaS platforms that rely on human operators to manage business processes.
Burry’s Brief Commentary Intensifies Selling Pressure
Michael Burry, the prominent investor famous for prescient contrarian positions, briefly published and subsequently removed a social media statement asserting that Anthropic was “eating Palantir’s lunch.” Though fleeting, the remark highlighted growing investor concerns about established SaaS companies’ exposure to emerging AI-native competitors and added momentum to Friday’s downturn.
While Burry’s quickly-deleted commentary offered no new hard data about ServiceNow’s operations, it resonated in an already nervous trading environment.
NOW shares have now surrendered 38.3% of their value year-to-date. Trading at $89.81, the stock languishes more than 56% below its 52-week high of $211.48 achieved in mid-2025. An investor who purchased $1,000 of NOW stock five years ago would currently hold approximately $858 in value.
The stock has experienced 11 single-day moves exceeding 5% over the past twelve months, indicating Friday’s sharp decline, while severe, fits within recent volatility patterns.
Fundamental Performance Remains Robust
Despite the stock’s punishing performance this year, ServiceNow’s core business metrics continue showing strength. The company reported full-year 2025 revenue of $13.3 billion, representing 21% growth versus the prior year. Subscription revenue, which provides stable recurring cash flows, contributed $12.9 billion to that figure.
ServiceNow closed 2025 with $28.2 billion in remaining performance obligations—a forward-looking indicator of committed future revenue—reflecting 27% year-over-year expansion.
The company has also taken proactive steps to counter the AI competitive threat. ServiceNow has established partnerships with both Anthropic and OpenAI, and earlier this year completed the acquisition of Moveworks, an AI agent technology provider serving major enterprises including Toyota and Unilever. That acquisition’s technology has been integrated into Autonomous Workforce, a product introduced in February that ServiceNow claims can autonomously handle 90% of routine IT support requests.
Shares last changed hands at $89.81, having touched a session low of $88.66.
Update April 10, 2026, 10 am UTC: This article has been updated to add more details from the announcement.
Hong Kong has issued its first stablecoin issuer licenses, approving Anchorpoint Financial and the Hongkong and Shanghai Banking Corporation under a new regulatory framework overseen by the Hong Kong Monetary Authority (HKMA).
The HKMA announced the initial batch of licensees on Friday, marking the first approvals under its stablecoin regime.
Anchorpoint Financial is the stablecoin joint venture formed by Standard Chartered Bank (Hong Kong), Animoca Brands and Hong Kong Telecommunications. The Hongkong and Shanghai Banking Corporation Limited is HSBC’s Hong Kong-based banking entity and one of the city’s three note-issuing banks.
The first approvals highlight Hong Kong’s cautious approach, with regulators appearing to favor bank-linked and institution-backed issuers in the regime’s opening phase.
The announcement comes after weeks of unconfirmed reports about potential licensees and a missed March timeline, marking a cautious start to Hong Kong’s stablecoin licensing rollout. HKMA Chief Executive Eddie Yue said in February that a very small number of issuers would be licensed in March, a timetable the HKMA ultimately missed before granting the first approvals.
Hong Kong’s stablecoin regime took effect on Aug. 1, 2025, and requires issuers of fiat-referenced stablecoins to obtain an HKMA licence and meet rules covering reserve backing, redemption, governance and Anti-Money Laundering controls.
Hong Kong rolls out stablecoin regime after delays
The stablecoin regime also gives the HKMA power to investigate violations and take enforcement action, including fines, suspensions and license revocations.
Yue said the new regime gives stablecoin issuers a regulated framework to operate in Hong Kong while requiring safeguards around user protection and risk management.
The licensed issuers are expected to launch their operations in the coming months, according to the HKMA.
Related: Hong Kong, Shanghai authorities to test blockchain for cargo trade data
On April 1, the HKMA said it was actively advancing the licensing process after missing its earlier March timeline.
Earlier media reports also pointed to possible frontrunners. On March 13, HSBC and a Standard Chartered-backed venture were tipped as likely recipients, but the regulator had not confirmed any names at the time.
Cointelegraph reached out to the HKMA for more information, but had not received a response by publication.
Magazine: Asia Express: Phantom Bitcoin checks, China tracks tax on blockchain
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