Federal regulators came out with their first proposed rules on how to oversee prediction markets on Wednesday. 

The Commodity Futures Trading Commission, which has taken the lead as the federal regulator over the markets, will seek to develop a framework to determine if contracts are contrary to the public interest and illegal.

Those questions surround contracts that relate to terrorism, assassinations, war, gaming or illegal conduct under state and or federal law, based on the Commodity Exchange Act. The commission did not outright ban any type of event contract based on the category of the trade, like those related to sports or elections.

The proposed rule focuses heavily on how the commission will determine if a contract crosses too much into the realm of terrorism, war or assassinations, topics that domestically-regulated exchanges have avoided offering contracts on.

The CFTC rules left some grey area around gaming, which has been the source of much controversy on the question of sports-related event contracts, though it detailed some sports-related contracts that the commission will not allow.

In a release, the commission acknowledged the rules proposed on Wednesday were thin, and noted that further rulemaking regarding prediction markets may come in the future.

After Wednesday’s announcement, the proposed rule will now face a 45-day public comment period.

“The CFTC will protect the integrity of our regulated markets without standing in the way of responsible innovation,” said CFTC Chairman Michael Selig, who was appointed by President Donald Trump, in a statement. “This proposal gives the Commission a durable, transparent framework to identify the contracts Congress directed us to scrutinize while letting legitimate markets move forward.”

Selig in a post on X added that the commission will “balance market integrity with responsible innovation” as it continues future rulemaking processes.

The rule establishes a process to determine how contracts will be prohibited. The commission will first determine if the contract is in fact based on an event happening. Then, it will consider if that event falls within the categories defined in the Commodity Exchange Act, and then conduct a public interest analysis to decide if it should be prohibited or not.

Prediction markets have exploded in popularity over the past year, creating a scramble to figure out how to regulate them.

States have challenged the platforms, believing their sports-related offerings amount to betting, something that is under their jurisdiction. However, the CFTC argues all contracts — no matter their topic — are swaps, which gives the agency exclusive authority to regulate them.

At the same time, bipartisan members of Congress have expressed concerns about the platforms and potential risks for insider trading, though no official legislation on the markets has been considered. 

On the question of sports, the rule was explicit that some contracts will not be allowed.

“Within gaming, the Commission aims to permit contracts settled on aggregate sports outcomes with objective data and integrity infrastructure, while prohibiting pure‑chance games and high‑risk sports‑adjacent designs (e.g., injury, officiating‑only, discrete actions, altercations, pre‑collegiate events),” according the rule.

The commission noted gaming, though, could be interpreted very broadly. It settled with one that defines it as something done for recreation or to entertain, is governed by rules and is based on measurable outcomes determined by skilled activity during the activity.

Using the new definition, the CFTC concludes contracts related to elections were not gaming, as they aren’t for recreation nor entertainment.

Bitcoin has erased its post-CPI gains after renewed threats from U.S. President Donald Trump against Iran pushed traders back into risk-off positioning and sent the crypto asset below $62,000.

According to market data, Bitcoin (BTC) briefly climbed above $62,400 on June 10 after U.S. inflation data came in line with expectations, easing concerns that price pressures were accelerating worse than anticipated.

The inflation report showed the U.S. Consumer Price Index rose 0.5% month-over-month in May, matching economists’ expectations, while the annual inflation rate came in at 4.2%, matching forecasts. The data eased concerns that inflation was reaccelerating beyond control and briefly strengthened expectations that the Federal Reserve could keep interest rates unchanged rather than hiking them later this year.

The move proved short-lived as geopolitical developments quickly took center stage, dragging BTC back toward the $60,000 area and leaving it down on the day.

Fresh pressure emerged after Trump issued a series of posts on Truth Social criticizing Iran and signaling that military action could intensify. In one post, Trump said Iran had taken too long to negotiate and would now “have to pay the price.” Later, he escalated his rhetoric further, telling reporters that “we’re going to be attacking them very hard,” fueling concerns that the conflict could expand in the coming days.

Oil markets also reacted to the developments. According to market data, crude oil rose 2% to around $90 per barrel as traders assessed the growing risk of supply disruptions across the Middle East.

Geopolitical risks overshadow inflation relief

Although the latest Consumer Price Index report initially supported risk assets, traders shifted their focus toward the deteriorating situation in the Gulf region.

According to reports cited by CNN, flashes of light observed near a U.S. military facility in Bahrain sparked fresh attention after Iran threatened retaliation against American interests in the region. The threats followed what Iranian officials described as U.S. “self-defense strikes” conducted after the downing of an American military helicopter.

Additional reports indicated that Iran launched attacks against Bahrain, Jordan, and Kuwait, further raising concerns about a broader regional conflict. Market participants have increasingly linked the possibility of prolonged disruptions in energy markets to higher inflation risks, a development that could complicate expectations for monetary policy and weigh on speculative assets such as cryptocurrencies.

Earlier military exchanges involving Israel and Iran had already contributed to weakness across digital assets, and the latest escalation added another source of uncertainty for traders.

On-chain and derivatives data highlight key Bitcoin levels

Beyond the geopolitical backdrop, recent on-chain data suggests Bitcoin has entered a period historically associated with major market stress.

As previously reported by crypto.news, K33 Research found that more than 50% of Bitcoin’s circulating supply is now held at an unrealized loss after the cryptocurrency briefly fell below $60,000 earlier this week.

According to K33 head of research Vetle Lunde, similar readings appeared near major bear-market lows in 2011, 2018, and 2022, although he noted that the indicator does not guarantee an immediate bottom.

Technical indicators continue to show weakness. On the weekly chart, Bitcoin remains below a bearish Supertrend indicator near $83,500 and has broken beneath a long-term trendline that previously acted as support. Weekly stochastic RSI has also turned lower, indicating that downside momentum remains intact.

Meanwhile, CoinGlass liquidation data points to important short-term levels. The largest concentration of leveraged positions sits near $64,000, creating a potential upside liquidity target if Bitcoin rebounds.

On the downside, notable liquidation clusters remain concentrated around the $60,000 to $60,500 zone, an area traders continue to watch closely as geopolitical headlines drive market sentiment.

Hence, if Bitcoin maintains support above $60,000, the next upside target could be the heavily populated liquidation zone around $64,000. Conversely, a breakdown below $60,000 may open the door to a move toward $55,000 and potentially the $52,400 support level highlighted by the weekly chart. 

Justin Sun-owned HTX revealed in its most recent proof-of-reserves, dated June 1, that it’s moved $1.3 billion worth of its reserves to a new category that it refers to as “ThirdParty.”

This has affected multiple important assets for the exchange, including bitcoin (BTC), ether (ETH), USDC, Usual Stablecoin (U), and Tether (USDT).

These balances have apparently been moved to a new custodian, as the HTX website now notes, “The assets in the Custodial Wallets are maintained by third-party custodians.”

In order to verify these quantities, we’re told to “please directly contact the third-party custodians.”

Unfortunately, HTX hasn’t publicly disclosed who those custodians are.

Protos reached out to HTX for clarification on who or what ThirdParty is, but HTX has yet to provide an explanation.

Bitcoin on HTX

Currently, the HTX proof-of-reserves claims that HTX has 20,922.77 BTC on the exchange.

Of these, only 8,691.6, or 41.5%, are native BTC on the Bitcoin blockchain.

Far larger than that are the 10,422.9, or 49.8%, which are tokenized BTC issued on the Sun-founded TRON blockchain.

The United States is entering a broader debate over AI-driven deception in political advertising as the midterm cycle intensifies. A growing constellation of state laws, a cautious federal stance, and high-profile campaign examples are shaping how campaigns may use or be constrained by AI-generated content in the near term.

Industry observers and watchdogs say the moment highlights a fundamental tension: AI can expand reach and persuasion for campaigns, but it also risks undermining trust if audiences cannot readily verify authenticity. Several developments this year illuminate where the policy terrain stands and where it might move next.

Key takeaways

• State-level patchwork: Roughly 28 states have disclosure requirements for political ads, with many penalties civil in nature; Minnesota’s 2023 law also contemplates criminal penalties for certain deepfake disclosures as elections approach.
• High-profile Minnesota case: An AI-generated ad targeting a Minnesota political race raised questions about deepfake legality and political norms, triggering responses from lawmakers on both sides of the aisle.
• Federal guardrails are cautious: The Federal Elections Commission emphasizes disclaimers and bans fraudulent misrepresentation, but has not launched a comprehensive AI rulemaking; broader federal legislation has repeatedly stalled.
• Legislative momentum and pushback: A bipartisan draft bill would preempt state AI regulations, drawing pushback from civil liberties groups that warn about overreach and the need for safeguards.

A patchwork of state rules governs AI in political ads

Across the United States, regulation of AI in political messaging has largely fallen to state governments. While about a quarter of states implement clear disclosure requirements for AI-generated content, most rules carry civil penalties rather than criminal consequences, and enforcement varies widely. Minnesota sits at the intersection of evolving policy and high-profile test cases.

In Minnesota, a campaign ad tied to the Senate primary drew scrutiny for its use of AI-generated imagery that appeared to resemble Lt. Gov. Penny Flanagan. Flanagan herself referenced the spot on BlueSky, noting that voters might soon see a TV ad “starring something that… kind of looks like me.” The episode underscored how AI can blur lines between genuine endorsements and deceptive representations.

The law in Minnesota already has a recent history of addressing AI deception. A 2023 measure, introduced by lawmakers concerned about manipulated content, approved language that criminalizes certain uses of deepfakes within 90 days of an election when the creator knows the content is a deepfake or intends to influence an election. Critics say the law’s structure makes enforcement highly fact-specific, and whether a given ad crosses the line depends on context and intent.

Observers note that while the incident occurred after the Democratic-Farm-Labor (DFL) Party secured a nomination, the legal questions are not easily resolved by a single ruling. The broader state environment includes a notable chorus of concern: 40 DFL state legislators signed a statement condemning AI-generated deepfakes in political advertising, arguing that the technology undermines trust in elections.

Minnesota case highlights tensions between policy and campaigning

The North Star Dawn PAC, which supported a candidate aligned against Flanagan, issued the AI-generated ad that sparked the dispute. Its content, which depicted a figure resembling Flanagan with a symbolic payoff image, drew immediate pushback from Flanagan and her allies, who described the approach as deceptive and inappropriate for public discourse. A leading Minnesota lawmaker summarized the sentiment by saying the use of AI deepfakes “is unacceptable” regardless of political affiliation.

The episode fed into a broader debate about the pace at which campaigns adapt to AI tools. Critics argue that even where laws exist, the ethical and practical implications of AI in political advertising merit careful consideration beyond compliance. Campaign consultants and advertising executives have urged a measured approach, acknowledging both the persuasive potential of AI and the risk to voter trust.

In parallel, observers like DSPolitical’s Mark Jablonowski noted that most campaigns, across parties, would prefer to set standards that protect voters and uphold integrity, even as exceptions may occur. The Minnesota case thus serves as a testbed for how laws may be interpreted in dynamic media environments where AI content can be produced quickly and disseminated broadly.

Federal regulators and lawmakers wrestle with AI in elections

On the federal front, the landscape remains cautious and inconsistent. The Federal Elections Commission (FEC) maintains that election advertising must include clear and conspicuous disclosures for content distributed by a candidate’s committee, and it reiterates that fraudulent misrepresentation is prohibited. While the FEC has discussed AI-specific questions in various contexts, it has not undertaken a comprehensive rulemaking to govern AI in political ads.

Public advocacy and consumer groups have pressed for more formal guidance. In 2023, Public Citizen petitioned the FEC to initiate rulemaking to address AI in campaign materials, but the commission opted not to begin a formal process at that time, arguing that existing fraud provisions already cover deceptive content regardless of the technology used.

Legislative efforts at the federal level have faced a slow trajectory. The REAL Political Advertisements Act—intended to establish more explicit AI-related rules—failed to pass in Congress. The broader political environment has historically shown limited appetite for sweeping AI regulation, even as concerns about safety, accuracy, and accountability mount.

Nevertheless, lawmakers continue to explore options. In June, a bipartisan draft bill proposed by Rep. Lori Trahan and Rep. Jay Obernolte would preempt state laws aimed at regulating AI model development, raising questions about how to balance innovation, consumer protection, and electoral integrity. Civil liberties groups, including the ACLU, argue that preemption could hinder essential safeguards—advocating instead for a framework that preserves state authority to address local harms while ensuring privacy, non-discrimination, and AI safety.

A spokesperson for the ACLU framed the concern clearly: preemption could broaden the potential for AI-enabled harms if states lose tools to police transparency and safety measures. ACLU policy experts emphasize that states must retain authority to protect residents from abuses, hold tech companies accountable, and ensure AI is safe and trustworthy. In the broader debate, the absence of a robust, unified federal standard leaves states to chart their own paths, while federal agencies look for practical guardrails that can be implemented without stifling innovation.

As policymakers weigh these issues, observers will watch for the outcomes of ongoing enforcement and potential new rules at the state level, along with any further federal proposals. The Minnesota episode and related debates illustrate both the urgency of addressing AI-driven deception in elections and the complexity of aligning legal frameworks with rapidly evolving technologies.

What readers should watch next is how states respond to ongoing incidents and whether federal regulators move beyond general antifraud provisions to craft concrete guidelines for AI-generated political content. The balance between safeguarding electoral integrity and enabling technological innovation will determine the trajectory of AI in political advertising through the 2026 cycle and beyond.

The customer experience industry will become a $5 trillion market by 2030, according to Netomi founder and CEO Puneet Mehta, who says that growth will create demand for stablecoins and blockchain-based payment infrastructure rather than pull capital away from crypto.

Mehta said companies currently spend roughly $500 billion annually on customer experience-related knowledge work. As AI expands beyond customer support into sales, conversion, upselling and cross-selling, he expects the market opportunity to grow tenfold by 2030.

“Customer experience today is structured as a silo,” Mehta said. “That layer of technology and people does not fully talk to every system and every process autonomously in the company. Once that starts to happen, it unlocks a much bigger category.”

Mehta, whose company recently raised $110 million in a Series C round backed by Accenture Ventures and Adobe Ventures, argues that the rise of artificial intelligence and crypto should be viewed as complementary trends rather than competing sectors.

“The idea that AI is simply sucking capital away from crypto is a fundamental misunderstanding of where technology is heading,” said Mehta, who previously worked as an engineer and data scientist at IBM and later held similar roles at JPMorgan, Citi and Merrill Lynch. “We are not in a zero-sum battle for venture dollars.”

Mehta’s view that AI agents will require faster financial infrastructure aligns with a growing argument among crypto executives that autonomous software could become a major driver of stablecoin adoption.

Fiat-pegged cryptocurrencies are entering a new phase of adoption, with large corporations using them for cross-border treasury flows while AI agents begin using blockchain rails for autonomous payments, Bridge and Deus X Capital executives recently said at Consensus 2026. In April, Chainalysis said stablecoins are on track to become a foundational layer of global finance, with adjusted transaction volumes projected to reach $719 trillion by 2035

AI enabling crypto

The next phase of enterprise software will rely on autonomous AI agents capable of handling increasingly complex business functions, including financial transactions, according to Mehta.

“AI agents are moving money and assets faster than legacy enterprises can follow,” he said. “An autonomous agent cannot rely on traditional banking systems that take days to settle transactions via manual paperwork. ”

Mehta argues that fully automated software systems require two key components: AI systems capable of decision-making and blockchain payment infrastructure capable of moving money instantly.

“To achieve true end-to-end automation, these software systems require always-on capital rails that operate 24/7,” he said.

That requirement could drive greater demand for stablecoins and blockchain-based settlement networks that operate around the clock (24/7). Stablecoin issuers and crypto payment firms have increasingly positioned their products as tools for real-time settlement and cross-border transactions.

Still, many enterprise software companies continue to rely on traditional payment providers and banking networks, and it remains unclear how quickly blockchain-based settlement systems will become a standard component of AI-driven commerce.

Unicorn status

Netomi’s latest raise brings its total funding to $168 million. Mehta declined to disclose the company’s valuation but said the company is nearing unicorn status.

Netomi, whose clients include global giants such as Delta, United Airlines, MetLife, ESPN, and ATB Financial, is building a unified AI platform rather than a collection of disconnected tools, he said.

While many enterprise AI providers focus on individual functions such as customer service, legal operations or sales support, he explained, Netomi is building systems that work across those functions and share information between them.

“Most companies are building point solutions,” Mehta said. “They’re solving one problem at a time. We believe the future is a connected enterprise where AI systems aren’t operating in silos but working together across the entire organization.”

UPDATE (June 10, 17:10 UTC): Adds section on Netomi nearing unicorn status.

Key Highlights

• Security Matters shares advanced 4.51% following platform introduction.
• New system emphasizes verified recycled plastic with enhanced monitoring capabilities.
• Digital Material Passports enable transparent recycled plastic commerce.
• Company registry designed to authenticate recycled plastic standards and availability.
• Plastic Cycle Token system provides digital oversight for recycling verification.

Security Matters (SMX) experienced upward momentum on Wednesday following the introduction of its Circularity-as-a-Service solution designed for the worldwide plastics sector. Shares reached $13.68, climbing 4.51%, as initial trading fluctuations transitioned into more stable afternoon activity. This debut establishes the company’s focus on authenticated recycled materials, transparent supply networks, and digital infrastructure for market operations.

SMX (Security Matters) Public Limited Company, SMX

Security Matters Debuts Circular Economy Platform for Plastics

SMX announced the solution is designed to transform recycled plastic into an authenticated and commercially viable industrial commodity. The infrastructure integrates molecular identification technology, reader networks, Digital Material Passports, and a comprehensive recycled materials registry. Additionally, it incorporates marketplace functionality and Plastic Cycle Tokens to validate recycling achievements.

The platform was developed in response to a plastics industry confronting increased financial pressures and supply uncertainties. Geopolitical conflicts, petroleum price instability, petrochemical production interruptions, trade restrictions, and environmental levies have fundamentally altered manufacturing economics. Consequently, producers now require documented evidence of recycled composition, provenance, and custody documentation.

Security Matters characterizes this transformation as the Age of Parity, wherein recycled plastics compete beyond environmental marketing narratives. The organization contends that authenticated recycled materials can achieve enhanced economic standing as virgin plastic pricing remains volatile. Accordingly, the solution emphasizes documentation, certification, and quantifiable circular economy metrics.

System Monitors Provenance, Standards and Regulatory Adherence

Every recycled material batch can receive a Digital Material Passport within the Security Matters framework. These passports document polymer classification, recycled percentage, origin point, quality grade, quantity, and authentication records. They additionally monitor reprocessing cycles, commercial exchanges, and regulatory compliance information for industry stakeholders.

The infrastructure addresses multiple segments throughout the plastics ecosystem. Participants include collection operations, sorting facilities, material recovery centers, reprocessing plants, compounding operations, pellet manufacturers and resin suppliers. The platform also accommodates converting operations, packaging producers, brand managers, retail organizations, and commodity trading firms.

The SMX Recycled Plastic Registry and Marketplace constitute core platform components. The registry catalogs authenticated recycled plastics and facilitates access for approved purchasers. It further enables enhanced transparency regarding quality specifications, geographic location, inventory levels, transaction records, and recycled material composition.

Security Matters Stock Advances as Industry Attention Intensifies

Security Matters equity appreciated as the platform introduction provided an updated commercial strategy centered on verified circular materials. Shares migrated toward the upper portion of the session’s trading band following an inconsistent opening. This movement reflected strengthening afternoon interest as market participants absorbed the announcement details.

The context surrounding this launch carries significance given mounting worldwide pressures facing plastic markets. Petrochemical supply chain disruptions, raw material scarcity, and packaging expense escalation have amplified uncertainty throughout the industry. Regulatory authorities and purchasers increasingly demand substantiated evidence supporting recycled content assertions.

SMX seeks to bridge this verification deficit through infrastructure built upon traceability protocols, registry documentation, and digital authentication mechanisms. The Plastic Cycle Token structure introduces an additional verification dimension for monitoring certified recycling performance. Through this approach, the company endeavors to make recycled plastics quantifiable, investment-grade, and more accessible for commercial transactions.

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

• To win over big investors, DeFi builders must act like accountable money managers, not just software developers, writes Ben Nadareski.
• Bitcoin holders can survive crashes and protect their assets by earning income through reinsurance, says Stephen Stonberg.
• Top headlines institutions should pay attention to by Helene Braun.
• “Hyperliquid’s 70% Rally: What Drove HYPE from $40 to $75 in Six Weeks” in Chart of the Week.

-Alexandra Levis

Expert Insights

Who answers the 3am call when DeFi breaks?

By Ben Nadareski, co-founder and CEO of Solstice

Last week, I shared something with CoinDesk that I want to sit with a little longer. A few minutes in an interview didn’t do it justice. My suggestion is that anyone building in DeFi should think of themselves as a financial asset manager who happens to write code, rather than as a software team that handles money.

A few people pushed back, so let me take one step further: the thing institutions really want from us has almost nothing to do with the code. They want to answer an age-old question: “When something goes wrong, who picks up the phone?”

So far, the answer has been nobody. The code is law: no company, no jurisdiction and no name on the door. For a while, we pushed that as the unique selling proposition (USP), and I understand the appeal. “Trust the contract, not the human” can feel like the safer bet, but if you spend time with a risk committee, you’ll see how strange it sounds to them.

They don’t underwrite code; they assess people and processes. They want to know who signed off, who can move funds, what happens at 3am when a key is compromised and whose responsibility it is to have considered those risks. If you hand them a brilliant protocol written by an anonymous team, with a multi-signature wallet (multisig) controlled by a group of people who have never met each other, the committee will not view it as an innovation. Instead, they will see it as an operational risk they can’t yet price.

And here’s where I’ve landed: the accountability they’re asking for is what lets decentralisation grow up. You get to keep the openness, the composability and the permissionless rails — all of it — while still answering the basic questions any serious financial steward should be able to address.

What does that look like in practice? It means having reserves you can verify in real time, allowing anyone to check solvency rather than relying on assertions in a blog post or press release. It includes controls to ensure that no single person can move significant amounts of money alone, because that’s standard practice in well-run institutions (and it should embarrass us that most protocols don’t adhere to this). None of this is a big ask; it’s the bare minimum.

I get the skepticism. People might say this is how you compromise on the speed that makes crypto alluring. I see it differently, though. Moving fast on what you build is a gift, whereas moving fast with other people’s money (with no one willing to be accountable for it) isn’t speed, it’s just risk waiting for a deadline. April showed us some of those deadlines, and there will be more.

The audience for getting this right has already changed. The institutions everyone keeps waiting for aren’t on their way. They’re already here, managing real money on these rails right now while half the industry debates whether they belong. The platforms that win in the next few years will be the ones that can include a Galaxy or Susquehanna alongside someone opening their first wallet in Lagos. Both should have the same access and the same protections, and both should know who is accountable when it counts.

That’s the bar I want us to be measured against, and I want it set higher than the banks — not on the same level. Not because regulators are coming, although they are. The harder question is whether we’ll build it ourselves or wait for someone else to force our hand.

Principled Perspectives

The centuries-old structure solving bitcoin’s yield problem

By Stephen Stonberg, CEO and co-founder, Tabit Insurance

Bitcoin holders face a dilemma: how do you preserve ownership through market stress without being forced into actions that destroy long-term value? The answer is not another “crypto yield wrapper”. As bitcoin BTC$62,285.48 adoption matures, a centuries-old financial structure is emerging as a compelling alternative: reinsurance.

BTC is currently trading well below its 2025 highs, and the drawdown is testing conviction across the investor spectrum. The investors who build lasting wealth are not those who predict bottoms or avoid drawdowns; they are the ones who can hold through corrections without being forced to sell. That requires a way to generate income from a long-term bitcoin position without relying on bitcoin’s price direction.

Why the traditional bitcoin yield playbook fails when you need it most

Most yield offerings fall into two buckets: options strategies that monetize volatility, and lending platforms that rehypothecate assets. Both tend to break precisely when stress arrives. Options strategies expose holders to path dependency, volatility regime shifts and counterparty risk, with yield that vanishes when margin calls hit. Lending platforms can be worse: bitcoin disappears into opaque collateral chains, and when liquidity dries up, so does the capital behind it.

Reinsurance is a different source of yield entirely

Reinsurance is insurance for insurance companies, allowing primary insurers to transfer portions of their risk portfolio to limit exposure to large-scale events. These contracts operate independently of financial markets, creating a structurally different return profile that combines underwriting profits with conservative leverage, a time-tested approach that predates cryptocurrency by centuries.

The key insight is that reinsurance returns are driven by real-world risk selection and pricing rather than bitcoin’s price direction. Hurricane risk in Florida does not care if bitcoin is trading at $40,000 or $100,000. This creates historically low correlation to both crypto markets and public equity beta with genuine diversification, rather than repackaging the same underlying exposures.

The mechanics

The structure is simple: post bitcoin as capital in a regulated (re)insurance vehicle, write USD-denominated policies and collect premiums in dollars. Reserves are held in cash and cash equivalents, using standard trust and custody mechanics, keeping the bitcoin ring-fenced as capital, not rehypothecated. Reinsurance is structurally advantaged here. BTC remains in institutional-grade custody within a corporate structure with legal segregation intended to isolate different investors’ assets, with investors able to have 24/7 on-chain proof of their bitcoin capital. This preserves the core objective: maintaining BTC exposure for long-term appreciation, while generating dollar cash flows from uncorrelated reinsurance premiums.

Why institutions should consider reinsurance

Recent 13F filings suggest that long-duration institutional investors are not all running for the exit. Select endowments, public pension plans and sovereign wealth-backed investors have added or maintained bitcoin ETF exposure through the drawdown, underscoring that sophisticated allocators are increasingly treating regulated bitcoin exposure as a long-term portfolio position rather than a purely tactical trade.

But staying the course is easier to justify when a bitcoin position can produce cash flow without depending on price appreciation alone. Reinsurance operates within established regulatory perimeters, supported by actuarial discipline, underwriting controls and capital adequacy standards. For institutions thinking in decades, that distinction matters. The objective is not to chase incremental yield by taking on more crypto-native risk. It is to keep bitcoin exposure intact, earn dollar-denominated income from an independent risk pool and reduce the likelihood that market stress forces a sale at precisely the wrong time.

Headlines of the week

By Helene Braun

A dormant Satoshi-era bitcoin wallet moved after 14 years as the owner became the target of a $285 billion lawsuit, with notice served through Bitcoin’s blockchain; institutional investors continued pulling money from bitcoin ETFs even as BTC revisited the $60,000 level that attracted buyers earlier this year; and DFG CEO James Wo, who built a billion-dollar crypto investment firm from a $20 million family-backed start, said he remains bullish on bitcoin while questioning some of the market’s most aggressive ether price forecasts.

Chart of the Week

Hyperliquid’s 70% rally: what drove HYPE from $40 to $75 in six weeks

HYPE ran from ~$44 to an ATH of $75.52 in six weeks (early May to June 3), as spot ETF launches from Bitwise and 21Shares drove over $130 million; the ATH broke on June 2–3 as TD Securities published the first major bank report documenting Hyperliquid beating CME to oil price discovery, with Grayscale’s HYPG ETF launching the same day.

Listen. Read. Watch. Engage.

• Listen: $3 billion leaves Bitcoin ETFs. Why Wall Street isn’t panicking. Jennifer Sanasie is joined by David LaValle to unpack a $2.97 billion outflow streak from Bitcoin ETFs, Bloomberg’s Eric Balchunas explains why the recent outflows may be more noise than signal and Stellar Development Foundation CEO Denelle Dixon discusses DTCC’s decision to select Stellar.
• Read: In “Crypto for Advisors”, Beth Haddock reviews the three due diligence questions advisors should be asking in 2026. Then, Aaron Brogan reviews the GENIUS Act implementation timeline and how things will change once it’s here.
• Watch: “I will not vote for CLARITY until we address ethics.” Senator Angela Alsobrooks joins CoinDesk Policy Protocol hosts Rebecca Rettig and Renato Mariotti to discuss the three outstanding issues she needs resolved before voting the CLARITY Act off the Senate floor.
• Engage: The CoinDesk: Policy & Regulation event is heading back to Washington, D.C. on September 24. This one-day event connects law makers with chief legal officers, compliance officers and policy experts to discuss the future of digital asset industry standards.

Looking for more? Receive the latest crypto news from coindesk.com and market updates from coindesk.com/institutions.

Note: The views expressed in this column are those of the author and do not necessarily reflect those of CoinDesk, Inc., CoinDesk Indices or its owners and affiliates.