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Crypto market enforcement and liquidity dynamics intersect as stablecoin issuer Tether pursues a more aggressive stance against illicit activity. In a period spanning three years, the company reportedly froze roughly $4.2 billion of USDt tokens tied to criminal schemes, with the bulk blocked since 2023 as regulators intensified scrutiny of sanctions evasion and fraud in crypto rails. USDt remains the dominant stablecoin, with outstanding supply reported to exceed $180 billion, up from about $70 billion three years earlier. Tether can blacklist wallet addresses to render tokens unusable on the blockchain when authorities request it, a tool that has become a central node in the crypto enforcement landscape.

Key takeaways

• Tether has frozen about $4.2 billion of USDt linked to crime over three years, with the majority blocked since 2023 as enforcement intensified.
• Recent actions include a nearly $61 million USDt seizure tied to pig-butchering scams, and a separate freeze of about $544 million in cryptocurrency at the request of Turkish authorities investigating illegal betting and money laundering.
• Elliptic’s analysis indicates that by late 2025, stablecoin issuers Tether and Circle had blacklisted roughly 5,700 wallets holding about $2.5 billion in aggregate, with USDt present in about three-quarters of those addresses when frozen.
• USDt supply has contracted sharply in early 2026, with February posting one of the largest month-over-month declines in three years, a trend seen alongside reductions in USDC during the period.

Tickers mentioned: $USDT, $USDC

Sentiment: Neutral

Market context: The actions reflect a tightening nexus between enforcement capabilities on-chain and liquidity management in crypto markets, where stablecoins serve as the primary rails for settlement and cross-border flows. As regulatory scrutiny increases, on-chain controls are becoming a more visible instrument for reducing illicit activity without fully constraining legitimate use cases.

Why it matters

Stablecoins anchor vast volumes of daily crypto activity, and USDt’s prominence means that enforcement actions reverberate across exchanges, wallets, and DeFi protocols. Tether’s ability to blacklist addresses to render USDt unusable embodies a centralized control mechanism within a decentralized asset class, underscoring a growing tension between anti-fraud and sanctions compliance and the user experience that market participants expect from permissionless rails. Exchanges and market makers rely on predictable liquidity; when on-chain assets are frozen at scale, liquidity pockets can suddenly reconfigure, affecting funding costs and the speed of settlement during periods of market stress.

At the same time, the broader ecosystem is watching how these on-chain tools interact with traditional regulatory levers. The seizure of nearly $61 million in USDt tied to criminal scams and the Turkish authorities’ $544 million action illustrate that cross-border enforcement remains active in the crypto space. Industry observers note that such actions, while important for deterrence, may also shape risk assessments for institutions and retail users who rely on stablecoins for risk management, hedging, and routine trading activity. The tension between compliance imperatives and the frictionless appeal of digital money will likely influence policy debates and product design in the coming quarters.

What to watch next

• Regulatory and enforcement developments related to stablecoins, including potential new guidelines on on-chain freezing powers and compliance standards.
• Expanded data from analytics firms on wallet blacklists, address clustering, and the distribution of USDt across exchanges and custody providers.
• Additional actions by Tether or other issuers to block illicit funds, including any official disclosures about scale and methodology.
• Liquidity indicators for crypto markets as USDt supply continues to evolve, alongside movements in USDC and other major stablecoins.
• Ongoing case developments in related enforcement actions, with updates from court filings or regulatory agencies.

Sources & verification

• Record of approximately $4.2 billion in USDt frozen over three years due to crime links, with the majority of actions occurring since 2023.
• Details on a nearly $61 million USDt seizure tied to pig-butchering scams in a DOJ-linked enforcement narrative.
• Turkish authorities’ case involving the freezing of about $544 million in cryptocurrency tied to illegal betting and money laundering.
• Elliptic’s analysis of blacklisted wallets and the share of USDt among addresses that were frozen by the end of 2025.
• Insights on USDt supply dynamics, including February and January declines, and comparative movements in USDC.

Rewritten Article Body: Enforcement actions reshape stablecoins and on-chain liquidity

USDt (CRYPTO: USDT) remains the largest stablecoin in circulation, with more than $180 billion outstanding, a scale that underscores how on-chain controls can influence day-to-day market dynamics. In a recent briefing summarized below, authorities and the token’s issuer have publicly detailed a string of actions aimed at curbing illicit activity linked to USDt on the blockchain. While the precise mechanics of such actions—blacklisting specific wallet addresses to render tokens unusable—are technical, their implications are deeply financial and systemic. A briefing linked here describes how roughly $4.2 billion of USDt has been blocked on-chain over three years, with the bulk of those blocks occurring since 2023 as authorities intensified scrutiny of crypto-related fraud and sanctions evasion.

One of the most tangible demonstrations of this enforcement capability occurred in a joint narrative about seizures and asset disruption: authorities seized nearly $61 million in USDt tied to pig-butchering scams, a criminal scheme in which perpetrators cultivate relationships with victims before persuading them to transfer funds. The details of that action are outlined in a linked briefing that avoids naming specific outlets, focusing instead on the mechanism by which the cryptocurrency—USDt—was effectively disentangled from illicit actors. The on-chain technique at the heart of this action—blacklisting affected addresses—highlights how a centralized control can operate within a decentralized asset class when requests come from law enforcement.

Enforcement actions are not limited to the United States. Earlier this month, Turkish authorities reported a separate freeze of approximately $544 million in cryptocurrency tied to alleged illegal online betting and money-laundering networks. The action demonstrates how cross-border investigations can intersect with stablecoins that are deeply integrated into global payment rails. In both cases, the underlying objective is to interrupt the flow of illicit proceeds and to establish a deterrent effect across the crypto ecosystem. The Turkish case, described in a linked article, underscores how national regulators leverage the on-chain properties of USDt to disrupt criminal ecosystems that span beyond a single jurisdiction.

Industry analytics firm Elliptic has provided broader context: by late 2025, the two leading stablecoin issuers—Tether and Circle—had blacklisted around 5,700 wallets holding roughly $2.5 billion in aggregate. Importantly, roughly three-quarters of the addresses involved contained USDt at the time of freezing. This is not merely a tally of addresses; it signals how the concentration of stolen or illicitly sourced funds often migrates into USDt-based wallets, prompting targeted enforcement actions and tighter monitoring of stablecoin flows across exchanges and custodians. The on-chain footprint of such actions matters because it provides a concrete, traceable path for authorities to cut off illicit liquidity without wholesale disruption to legitimate users.

On-chain data also point to shifting liquidity patterns within the broader market. USDt supply has declined notably in early 2026, with February marking one of the largest monthly reductions in three years, a development that coincided with declines in USDC as well. While Tether has argued that the contraction reflects distribution patterns rather than weakening demand, the data align with a broader narrative of tighter liquidity in crypto markets following the FTX episode and ongoing regulatory scrutiny. For users and institutions, this confluence of reduced supply and heightened enforcement signals an environment in which on-chain risk management, asset compliance, and regulatory expectations will increasingly shape day-to-day decision-making.

Looking ahead, observers anticipate ongoing adjustments across stablecoins as enforcement, compliance, and market structure continue to intertwine. The conversations around stablecoin freezes, on-chain blacklisting, and real-world enforcement actions will likely influence policy considerations, product design, and the practical ways in which traders, wallets, and exchanges manage liquidity. While the tools at hand—address-level sanctions and blacklists—offer clear utility for disrupting illicit activity, they also introduce new questions about resilience, user experience, and maintaining open, efficient channels for legitimate commerce in a rapidly evolving digital money landscape.

In sum, the actions surrounding USDt reflect a crypto market increasingly governed by traceability and accountability, even as it operates within the decentralized promise of blockchain networks. The balance between regulatory compliance and the foundational ethos of permissionless finance remains a live debate, one that will continue to shape the trajectory of stablecoins, market liquidity, and cross-border financial flows in the months ahead.

Key Takeaways

• Confidential IPO paperwork expected from SpaceX to the SEC by March 2026
• Public market debut targeted for June, with potential valuation exceeding $1.75 trillion
• Capital raise could reach $50 billion, setting a new record for IPO proceeds
• Recent xAI merger adds complexity to SpaceX’s financial reporting structure
• AI giants OpenAI and Anthropic considering 2026 public offerings at $750B–$830B and ~$350B valuations

Elon Musk’s aerospace manufacturer SpaceX is gearing up to submit confidential IPO paperwork to the U.S. Securities and Exchange Commission by March 2026, per reporting from Bloomberg.

This confidential submission would position the company for a public market debut potentially in June 2026. Industry sources suggest SpaceX is pursuing a valuation that exceeds $1.75 trillion.

At such a valuation, SpaceX would join an elite group of the planet’s most valuable corporations. The company would sit alongside tech giants like Apple, Microsoft, Alphabet, Amazon, and Nvidia.

The capital raising component could hit $50 billion, establishing a new benchmark as the most substantial IPO ever executed. No previous public offering has approached this magnitude of fundraising.

Headquartered in Starbase, Texas, SpaceX commands the Falcon 9 launch platform and manages Starlink, a satellite-based internet service reaching millions worldwide.

The aerospace firm accounts for more than 50% of Earth’s orbital launches. Its breakthrough reusable rocket technology revolutionized space access economics.

SpaceX achieves Ebitda profit margins estimated at 50%. Traditional aerospace firms listed on the S&P 500 typically deliver margins around 20% by the same metric.

Executives have indicated Starlink turned profitable during 2024, when its subscriber base was approximately half its current size. The launch division is similarly expected to operate profitably based on its cost advantages.

The xAI Integration Challenge

SpaceX completed a merger with Musk’s AI venture xAI in recent months. This transaction combines SpaceX’s space infrastructure with xAI’s artificial intelligence computing operations.

xAI doesn’t appear to generate profits and competes in an expensive, saturated market segment. The integration complicates efforts to evaluate SpaceX’s consolidated financial health before going public.

Analysts project SpaceX might produce up to $10 billion in Ebitda during 2026, though this estimate depends heavily on xAI’s loss contribution to the merged company.

Confidential filing procedures allow companies to address regulatory requirements with the SEC privately before disclosing financials publicly. Regulatory rules require at least 15 days between public filing and roadshow commencement.

Additional Major Tech Listings Expected

SpaceX could lead a trio of significant technology IPOs scheduled for 2026. OpenAI reportedly seeks a valuation ranging from $750 billion to $830 billion.

Anthropic, focused on AI safety research, may pursue approximately $10 billion in funding at roughly $350 billion valuation. Both organizations are monitoring SpaceX’s IPO trajectory.

SpaceX hasn’t issued official statements regarding the IPO timeline. Plans remain fluid and the company retains the option to postpone its filing schedule.

TLDR

• Block revealed plans to eliminate more than 4,000 positions (approximately 40% of staff), attributing the decision to AI capabilities
• The announcement triggered concerns about potential AI-driven disruption facing legacy financial institutions like American Express
• AXP shares plummeted nearly 8% during Friday’s trading session
• Significant put option volume indicated traders positioning for additional downside, with put-to-call ratio reaching 2.6
• Year-to-date, AXP has declined 11.39% while implied volatility surged

Shares of American Express $AXP plummeted nearly 8% during Friday trading after Block’s dramatic workforce reduction announcement sent shockwaves through financial services stocks.

American Express Company, AXP

Block revealed plans to eliminate over 4,000 positions, representing approximately 40% of its employee base. The disclosure came as part of the company’s fourth-quarter and full-year 2025 financial results.

In explaining the dramatic restructuring, Block’s founder and CEO Jack Dorsey pointed to artificial intelligence as the driving force. His shareholder letter stated: “A significantly smaller team, using the tools we’re building, can do more and do it better.”

Dorsey emphasized that “intelligence tool capabilities are compounding faster every week,” making clear this represents an ongoing transformation rather than an isolated cost-cutting measure.

The announcement resonated powerfully with market participants. The logic was straightforward: if a digitally-native payments platform like Block can eliminate nearly half its workforce through AI implementation, what implications does this hold for established financial institutions?

This reasoning placed American Express squarely in investors’ sights. Even with its robust infrastructure and substantial technology investments spanning decades, the market viewed AXP as potentially exposed to similar pressures.

The selloff was swift and substantial. AXP shed nearly 8% throughout the session, settling at $307.95. Intraday trading ranged between $307.67 and $321.01.

Options Activity Reflects Heightened Anxiety

The equity decline was accompanied by notable derivatives market movement that reinforced bearish sentiment.

Approximately 22,400 put contracts traded on Friday, representing roughly five times typical daily volume. Considerable interest centered on March and June 2026 $280 strike puts, which saw approximately 4,700 contracts traded.

The put-to-call ratio surged to around 2.6, a definitive indication that traders were securing downside hedges rather than positioning for upside moves.

At-the-money implied volatility increased by over six points, signaling heightened expectations for significant price movements in AXP shares going forward.

Wider Market Picture

Friday’s decline extends a challenging period for the stock. AXP has now surrendered 11.39% year-to-date, marking a difficult opening to 2026 for shares that recently touched a 52-week peak of $387.49.

Typical daily trading volume averages approximately 3.1 million shares. Friday’s volume registered just 379,000, indicating the decline was sentiment-driven rather than the result of widespread selling pressure.

American Express maintains a market capitalization around $212 billion, operates with a gross margin of 60.65%, and offers shareholders a dividend yield of 1.06%.

Current technical indicators for the company show a “Buy” signal, though that guidance hasn’t prevented the recent downward trajectory.

AXP has incorporated AI technologies into its business operations for years and has navigated numerous technological transitions throughout its history. Nevertheless, Block’s workforce announcement proved sufficient to prompt Friday’s investor exodus.

The concentration of put option interest in March and June 2026 expirations indicates market participants are anticipating sustained volatility for AXP shares through the middle of the year.

Global tokenized real-world assets have now crossed the $25–30 billion mark in on-chain value, growing at triple-digit rates year over year. Major asset managers, global banks, and market infrastructures have moved beyond pilots and into live issuance of tokenized bonds, funds, and deposits. Yet for all this momentum, the most important development is not happening in crypto-native markets. It is happening inside regulated capital markets, and Korea is emerging as one of the clearest examples.

Korea is not “embracing crypto securities” in the way headlines often suggest. Nor is it dismantling its securities laws to accommodate blockchain experimentation. Instead, it is modernizing capital markets using blockchain technology while keeping the existing regulatory framework for securities firmly in place.

In practice, Korea is treating tokenized securities much like the transition from paper certificates to electronic registration decades ago: not as a new asset class, but as a more efficient way to issue, settle, and manage the same financial instruments.

From sandbox to system

For years, tokenization lived in regulatory sandboxes — useful for testing, but structurally limited. Korea is now moving past that phase. By formally recognizing tokenized securities within its capital-markets framework, regulators are signaling that blockchain belongs inside the system, not alongside it.

Securities law still governs disclosure, custody, suitability, and market conduct. Issuers do not gain shortcuts by going on-chain. Intermediaries remain accountable. Investor protections are preserved. The innovation lies in the plumbing: faster settlement, improved transparency, and reduced operational friction.

This approach may appear conservative compared to DeFi narratives, but it is precisely what enables scale. Institutions do not deploy balance sheets into regulatory ambiguity. Retail investors do not gain confidence from experimental venues. Korea’s model solves both problems by anchoring tokenization to familiar legal foundations.

Why Korea is uniquely positioned

Korea’s capital markets combine deep retail participation with sophisticated demand for structured and alternative products. That combination makes tokenization especially powerful.

Tokenized securities allow fractional exposure to assets that were previously illiquid, high-denomination, or operationally complex — including real estate, private credit, and revenue-generating intellectual property. Retail access expands, but through regulated issuance and distribution channels rather than speculative token listings.

This is likely to redirect attention and capital away from short-lived, exchange-driven token cycles toward regulated products with real cash flows, disclosures, and secondary-market structure. The shift is subtle but profound. Tokenization stops being about what can be listed quickly and starts being about what can be issued, held, traded, and settled reliably.

The real opportunity is not issuance hype. It is infrastructure. As tokenized securities become embedded into settlement and post-trade processes, the benefits compound. Shorter settlement cycles reduce counterparty risk. On-chain transparency improves auditability. Operational costs decline. Once these efficiencies are realized, reverting to legacy workflows becomes economically irrational.

Who actually wins

Contrary to popular perception, the early winners in Korea’s tokenization market will not be crypto exchanges, DeFi protocols, or speculative token projects. They will be:

• Brokerages and securities firms that can distribute tokenized products compliantly;
• Infrastructure providers building custody, settlement, and compliance layers;
• Issuers that understand both capital-markets regulation and on-chain execution.

This is not a replacement for traditional finance. It is a technological upgrade to how parts of it function.

Global implications

Korea’s move matters beyond its borders. Each major jurisdiction that formally recognizes tokenized securities strengthens the global case that blockchain is becoming a standard financial ledger, not a parallel system.

That shift reduces legal uncertainty for global real-world asset issuers and accelerates the need for cross-border standards. When tokenized securities are treated consistently across markets, interoperability stops being a technical aspiration and starts becoming a commercial necessity.

Just as importantly, Korea demonstrates that retail-heavy markets can adopt tokenization without sacrificing regulatory credibility. For policymakers elsewhere, this is a critical proof point. Innovation does not require deregulation. It requires clarity.

The questions still to be answered

This transition is not complete, and several issues remain open. Secondary market structure is the most pressing. Will tokenized securities trade only OTC, or will regulated exchange-style venues emerge? How will liquidity obligations, price transparency, and market-making requirements be defined?

Infrastructure access is another. Who qualifies as a tokenization operator? How open will this layer be to fintechs versus established incumbents? The balance struck here will shape competition and innovation for years.

Retail eligibility and suitability rules will also matter. Concentration limits, disclosure standards, and investor education will determine how inclusive tokenized markets become without introducing systemic risk. These are not technical footnotes. They are structural decisions that define whether tokenization delivers on its promise.

The bottom line

Korea is executing a legitimacy pivot — from sandbox to system. It is becoming one of the world’s most advanced proving grounds for real-world asset tokenization. For the first time, atypical assets such as K-pop intellectual property, webtoons, and real estate have a clear statutory home. What were once speculative fractional exposures can now become regulated, audited, and legally enforceable financial instruments.

Tokenized securities will not replace traditional finance overnight. But in Korea, they are on track to quietly replace how parts of it work. This shift has little to do with crypto price cycles. It has everything to do with where capital markets are structurally heading over the next decade — and Korea is positioning itself ahead of that curve.

Key Points

• A fresh inference computing platform is in development at Nvidia to accelerate AI model execution for OpenAI and similar enterprises.
• Groq, a chip startup, will supply the processor for this platform, which Nvidia plans to unveil at its upcoming GTC conference in San Jose.
• Performance issues with Nvidia’s existing hardware have left OpenAI dissatisfied, particularly for development-related workloads.
• A massive $20 billion licensing agreement between Nvidia and Groq halted OpenAI’s independent negotiations with the startup.
• Last September, Nvidia pledged up to $100 billion toward OpenAI in exchange for equity ownership.

According to a Wall Street Journal article released Friday, Nvidia is creating a specialized processor designed to enhance the speed and efficiency of AI inference operations.

When AI systems like ChatGPT answer user questions, they’re performing inference computing. This differs substantially from training operations, where Nvidia has maintained market leadership for years.

Nvidia’s GTC developer conference in San Jose next month will serve as the launch venue for this platform. At its core sits a processor manufactured by emerging company Groq.

NVIDIA Corporation, NVDA

Neither Reuters nor Nvidia provided immediate confirmation of these details. OpenAI similarly remained silent when asked for comment.

The context surrounding this development is significant. Earlier this month, Reuters revealed that OpenAI has expressed frustration over performance limitations in Nvidia’s current hardware lineup—particularly when handling software development queries and facilitating AI-to-AI interactions.

OpenAI is pursuing hardware solutions capable of managing approximately 10% of its inference workload. Nvidia appears determined to retain this business.

The Hunt for Enhanced Processing Power

Prior to Nvidia’s intervention, OpenAI had initiated discussions with two chip manufacturers—Cerebras and Groq—seeking superior inference processing capabilities.

Those negotiations ended abruptly. Nvidia secured Groq through a $20 billion licensing arrangement, eliminating OpenAI’s option to work directly with the startup.

This represents a calculated strategic maneuver. By acquiring Groq’s technology through licensing, Nvidia simultaneously blocked a potential competitor from reaching OpenAI while gaining access to Groq’s chip innovations for its own infrastructure.

The Deeper Financial Connection

The commercial ties between Nvidia and OpenAI extend well beyond hardware procurement.

Last September, Nvidia announced plans to commit up to $100 billion to OpenAI. This arrangement provided Nvidia with ownership shares in the AI developer while furnishing OpenAI with resources to acquire cutting-edge processors.

Nvidia now occupies dual roles as both hardware vendor and financial stakeholder—a strategic position that creates powerful incentives to maintain control over OpenAI’s chip requirements.

On February 27, the day prior to this news emerging, NVDA stock declined 4.16%.

Should the inference platform receive official confirmation at next month’s GTC event, it would mark Nvidia’s targeted answer to mounting demands from clients requiring faster, purpose-built AI processing capabilities.

Groq’s inclusion in the platform architecture indicates Nvidia’s readiness to forge startup partnerships rather than engage in pure competition—particularly when such collaborations prevent competitors from accessing major clients.

Nvidia’s GTC developer conference is scheduled for San Jose next month, where the company is anticipated to formalize this announcement.

TLDR

• Lockheed Martin shares gained 2.7% during Friday’s session, climbing to approximately $659 with trading volume surging 34% above typical levels.
• Fourth-quarter revenue exceeded forecasts at $20.32B versus the expected $19.84B, though earnings per share fell short at $5.80 compared to the $6.33 consensus.
• Successful testing of Lockheed’s Next Generation Command and Control (NGC2) platform by the U.S. Army, with additional testing scheduled for April 2026.
• The company received an $18.8M contract modification from the U.S. Navy for continued work on the Trident II (D5) Life Extension 2 initiative, extending through August 2030.
• Shares have surged more than 31% since the start of the year, approaching record territory, while the company announced a $3.45 quarterly dividend payment.

Shares of Lockheed Martin (LMT) advanced 2.7% in Friday’s trading session, touching an intraday peak of $662.47 before closing near $659.24. This represented a notable jump from the prior session’s close at $641.63.

Lockheed Martin Corporation, LMT

Trading activity was notably robust. Approximately 2.59 million shares exchanged hands, representing a 34% increase compared to the typical daily volume of around 1.93 million shares.

The upward momentum followed announcements of two distinct military contract developments within the same week, further cementing LMT’s critical role as a primary defense supplier to the U.S. military.

The U.S. Army wrapped up prototype testing of Lockheed’s Next Generation Command and Control (NGC2) platform with the 25th Infantry Division. This advanced system integrates sensor information directly with weapons platforms, enabling military personnel to detect and neutralize threats more rapidly.

This “sensor-to-shooter” functionality represents a crucial element of contemporary combat operations. Insights gained from this recent evaluation are already informing platform improvements, with additional testing scheduled for April 2026 as part of the “Lightning Surge 3” field exercise.

Meanwhile, Lockheed was awarded an $18.8 million contract modification related to the Trident II (D5) Life Extension 2 initiative. This program supports the nation’s submarine-based nuclear deterrent capabilities, with work continuing through August 30, 2030.

The majority of activities will take place at Lockheed’s Alabama facility in Huntsville. While the contract value may appear modest in isolation, the extended timeline and strategic significance of the program carry considerable weight with market participants.

Q4 Earnings: Revenue Beat, EPS Miss

LMT’s latest quarterly financial report, released January 29, revealed revenue of $20.32 billion compared to analyst projections of $19.84 billion — exceeding expectations by approximately $480 million. This represented a 9.1% increase from the prior-year period.

Earnings per share registered at $5.80, falling short of the $6.33 consensus estimate by $0.53. The company had delivered $7.67 EPS during the comparable quarter one year earlier.

Wall Street analysts are projecting full-year EPS of $27.15 for the ongoing fiscal period.

Analyst Targets and Dividend

Numerous analysts have adjusted their price targets higher in recent weeks. Citigroup increased its target from $592 to $673, while keeping a “neutral” stance. RBC Capital Markets raised its target from $615 to $650 with a “sector perform” designation. Robert W. Baird moved to $640 while maintaining an “outperform” rating.

The consensus view from MarketBeat shows a “Hold” recommendation with an average price target of $612.50 — notably beneath current trading levels.

Lockheed announced a quarterly dividend of $3.45 per share, scheduled for payment on March 27 to investors on record as of March 2. This translates to an annualized dividend of $13.80, producing a yield of approximately 2.1%. The company’s payout ratio currently stands at 64.22%.

The defense contractor carries a market capitalization of $151.68 billion, with a price-to-earnings ratio of 30.68 and a beta coefficient of 0.23. The stock’s 50-day moving average sits at $578.05, while the 200-day moving average is $508.04.

LMT has climbed more than 31% since the beginning of the year and is trading in proximity to record highs. Institutional ownership accounts for 74.19% of outstanding shares.

The combination of both metrics suggests the current regime is consolidative or mid-cycle bearish, with definitive capitulation likely to occur soon.

Current market dynamics point to a reset in motion, with Bitcoin undergoing deleveraging. However, the leading digital asset is yet to form a bottom for this bear cycle, despite cooling market conditions.

According to a report from CryptoQuant, metrics such as falling open interest and Bitcoin basis compression on the Chicago Mercantile Exchange (CME) indicate ongoing deleveraging.

More Pain For BTC?

The CME basis compression is a futures yield curve that reflects demand for leveraged long exposure. The curve has been in a downward trend since 2025, following patterns that preceded the 2019 and 2022 bear markets. However, the slope remains positive to this day. While the curve’s current slope suggests leverage demand and risk appetite are cooling, the market has not yet reached conditions historically associated with capitulations. It confirms gradual ongoing deleveraging, but not capitulation.

The yield curve compression currently signals weaker demand for leveraged long exposure, as market participants become less willing to pay a premium for bitcoin (BTC) exposure. This points to weakening bullish conviction and a more neutral or bearish backdrop. However, longer-dated contracts are still trading at a premium to spot and short-dated futures.

In essence, the curve reflects an environment where price rallies may face resistance until a definitive cyclical bottom forms. Past cycle bottoms have formed only when the yield curve slope turned negative, signaling backwardation and acute deleveraging. This means that BTC still has more downside to come.

Cyclical Bottom Coming Soon

Additional proof that the Bitcoin market is undergoing a gradual reset in positioning rather than the acute stress needed to form a bottom is the decline in futures open interest. This metric has fallen sharply from its 2025 peak, following a trend seen during the 2022 bear market.

CryptoQuant found that the CME Bitcoin futures open interest has plummeted by 47%, similar to the 45% plunge witnessed in 2022. Such a move reflects a major unwind of leveraged positions following a period of increased participation. This unwind is characterized by prolonged liquidation, reduced speculative demand, and lower hedging activity, confirming an ongoing deleveraging cycle.

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The combination of a declining open interest and a positive yield curve suggests the current regime is consolidative or mid-cycle bearish, with definitive capitulation likely to occur soon.

Bitcoin is looking to reclaim $64,000 on possible short squeeze after earlier falling to as low as $63,000 following U.S. and Israeli strikes on Iran.

At the same time, perpetual futures funding rates dropped to -6%, according to CoinGlass, marking the second lowest level in the past three months. The last time funding was this negative was on Feb. 6, when bitcoin bottomed near $60,000.

Perpetual funding rates represent the periodic payments exchanged between traders in perpetual futures markets. When rates are positive, traders holding long positions pay those holding shorts. When rates turn negative, shorts pay longs.

Deeply negative funding typically signals aggressive short positioning and bearish sentiment, as traders are willing to pay a premium to maintain downside bets.

Meanwhile, coin margined open interest rose from 668,000 BTC to 687,000 BTC over the past 24 hours.

Measuring open interest in BTC terms removes the distortion caused by price swings. Rising open interest alongside negative funding suggests growing participation, with an increasing share of traders positioned for further downside.

In the past 24 hours, more than $500 million in crypto positions have been liquidated, according to CoinGlass data. The bulk of those liquidations were long positions, which accounted for over $420 million, highlighting the scale of forced selling as prices moved lower.

Stablecoin issuer Tether has reportedly frozen roughly $4.2 billion worth of its USDt tokens connected to suspected criminal activity over the past three years.

Most of the blocked funds were restricted since 2023, as regulators and law enforcement agencies intensified scrutiny of crypto-related fraud and sanctions evasion, the El Salvador-based firm reportedly told Reuters on Friday.

Tether’s dollar-pegged USDt (USDT) token is the largest stablecoin in circulation, with more than $180 billion outstanding, up sharply from about $70 billion three years ago.

Tether can freeze tokens directly on the blockchain by blacklisting wallet addresses when requested by authorities.

Related: Tether-backed Oobit adds crypto-to-bank transfers for local payment networks

Tether helps governments freeze funds

On Tuesday, Tether announced that it has assisted the US Department of Justice in seizing nearly $61 million in USDt tied to “pig-butchering” scams, a scheme in which criminals build relationships with victims before persuading them to send money.

Earlier this month, the company also froze approximately $544 million in cryptocurrency at the request of Turkish authorities, blocking funds tied to an alleged illegal online betting and money-laundering operation.

According to blockchain analytics firm Elliptic, by late 2025, stablecoin issuers Tether and Circle had blacklisted around 5,700 wallets holding about $2.5 billion, with roughly three-quarters of the addresses containing USDt when they were frozen.

Related: Tether USDT supply set for biggest monthly decline since 2022 FTX collapse

USDt supply shrinks

As Cointelegraph reported, USDt is on track for its largest monthly supply drop in three years, with circulating supply falling about $1.5 billion in February after a $1.2 billion decline in January, according to blockchain data. The contraction echoes the period following the FTX collapse in late 2022 and may point to tighter liquidity in crypto markets.

Tether said the figures reflect short-term distribution changes rather than weakening demand, noting USDC (USDC) also saw a multibillion-dollar reduction during the same period.

Magazine: Bitcoin may take 7 years to upgrade to post-quantum — BIP-360 co-author