Core DAO has begun coordinating an emergency hard fork after a small group of validators obtained CORE rewards above the blockchain’s intended issuance, prompting several exchanges to restrict token transfers.

Core said on Sept. 1 that it had contained the issue and stopped what it described as “malicious validators” from drawing further excess rewards. The network is now working with validators on a permanent fix through a forward upgrade, meaning previously confirmed transactions will remain unchanged.

“Assets remain safe,” Core said, adding that a full technical postmortem would be published after the response is completed.

The project has not disclosed the amount of CORE distributed through the incident, the number of validators involved, how long they were able to obtain the excess rewards, or whether any of the additional tokens reached the market.

Core DAO hard fork will not reverse transactions

Core first disclosed the problem on Monday, when it said a small number of validators were accruing block rewards significantly above the amount intended under the protocol.

At the time, the project said it had identified the root cause and was working on mitigation measures. Core described the problem as limited to reward issuance and said it had not affected network security or custody of user assets.

By Tuesday, the team said the activity had been contained and moved to coordinate the emergency hard fork with its validator set. Core has not published an activation time for the upgrade or disclosed the technical vulnerability that allowed the excess rewards to be claimed.

The distinction between a forward upgrade and a rollback means the planned fork is intended to change the network rules from a specified point without rewriting transactions already recorded on the blockchain.

Mainnet upgrades can require coordination between validators and other network participants because nodes must run compatible software after new protocol rules take effect. As crypto.news previously reported, hard forks on production blockchains can require validators and users to reach agreement around the updated network rules.

Core has not said whether validators will need to install a specific software release before the emergency upgrade or what level of validator participation will be required for the fork.

Exchanges restrict CORE transfers

The reward problem led several centralized exchanges to restrict CORE deposits or withdrawals while the network investigated the incident.

Coinbase paused sends and receives on the Core DAO network, according to its status page. Trading functions remained available, with buys, sells, conversions and fiat transactions unaffected by the network transfer restriction.

South Korean exchanges Bithumb and Coinone suspended CORE deposits and withdrawals, citing security concerns surrounding the network.

Bitget restricted CORE deposits and withdrawals under what it described as wallet maintenance, while LBank suspended deposits in response to project requirements. The exchanges did not attribute losses of customer funds to the Core incident.

Core has maintained that user assets were not affected and said the problem involved the issuance of validator rewards.

The project has yet to disclose whether the exchanges will need to complete technical work related to the hard fork before normal CORE transfers can resume.

Validator rewards remain under scrutiny

The unanswered questions center on the amount of CORE obtained by the validators and the mechanism that allowed them to receive more than the protocol intended.

Core has not said whether the excess rewards represented newly created CORE, rewards that would otherwise have been distributed at a later date, or another accounting problem within the validator reward system.

The project has likewise not disclosed whether any of the validators sold, transferred or otherwise moved the additional CORE after receiving it. Its planned postmortem is expected to provide technical details about the root cause, though Core has not given a publication date.

Validators form part of Core’s network architecture, which combines delegated proof of stake with Bitcoin-linked security. Core has spent the past several years building its network around Bitcoin staking and decentralized finance applications.

In March 2025, Core integrated with Cobo to expand its dual Bitcoin staking service for institutional users in Asia. The arrangement allowed Cobo users to stake Bitcoin and CORE while earning BTC-denominated yields.

At that point, institutions had used Core to stake more than 6,200 BTC, while more than 150 Ethereum Virtual Machine-compatible decentralized applications had been integrated into the ecosystem. Core’s total value locked stood above $525 million when the partnership was announced.

The network had already become one of the largest Bitcoin sidechains by locked value. Earlier data showed Core with $423 million in TVL while 55% of Bitcoin’s hash rate was helping secure the network. Messari data cited at the time showed Core had 23 validators during the second quarter of 2024.

Core’s validator system plays a direct role in distributing CORE rewards. The current incident, however, remains limited in publicly disclosed technical details because the project has not explained which part of that reward process was exploited.

Emergency upgrade follows other recent hard forks

Core’s planned response comes shortly after other blockchain networks used hard forks to modify protocol rules, though the reasons for those upgrades differed.

BNB Chain, for example, activated its Pasteur hard fork on Aug. 25 after scheduling changes to bridge verification, validator authorization and block capacity.

One of the Pasteur changes addressed a cross-chain verification weakness that could allow duplicate validators to be counted when determining whether an approval had reached the required threshold. BNB Chain said it had not identified an exploitation of that flaw or linked it to asset losses before the correction was deployed.

Cardano completed another network upgrade in July when the van Rossem hard fork moved its mainnet to Protocol Version 11 that introduced changes to Plutus costs while preparing the network for its planned Ouroboros Leios architecture.

Core’s emergency upgrade is being coordinated after the reward problem was detected rather than as part of a previously announced protocol development schedule.

The network has said the excess reward activity can no longer continue under the mitigation already put in place. Core has not disclosed the identities of the validators it described as malicious or whether it plans to take further action against them.

Its forthcoming postmortem is expected to address the technical cause of the incident, while the amount of excess CORE issued and whether any of those tokens entered circulation remain undisclosed.

Bank of America, Citi, Goldman Sachs and 18 other financial institutions committed on Sept. 1 to establish a stablecoin company during the second half of 2026, subject to closing conditions.

The unnamed venture plans to issue a U.S. dollar-denominated stablecoin during the first half of 2027. The group said it may later introduce tokens linked to other G7 currencies, with a euro stablecoin named as its first expansion priority.

The institutions intend to use the token across wholesale, institutional and retail markets. Proposed uses include cross-border payments and settlement for digital asset transactions.

The announcement remains a development plan rather than a completed launch. The group has not disclosed the company’s name, token name, blockchain networks, reserve custodian, governance structure or final redemption terms.

Stablecoin group spans four continents

The consortium comprises banks, asset managers and other financial institutions based across North America, Europe, East Asia, the Middle East and Africa.

Its North American participants are Bank of America, Capital One, Citi, Fidelity Investments, Goldman Sachs, PNC Financial Services, Scotiabank, TD Bank Group, Wells Fargo and WisdomTree.

European members include Banco Santander, BBVA, Commerzbank, Crédit Agricole, Deutsche Bank, Lloyds Banking Group, Rabobank and UBS. MUFG Bank represents East Asia, while Sirius International Holding and Standard Bank represent the Middle East and Africa, respectively.

The group said the project would combine the participants’ distribution networks with bank compliance, governance and risk-management systems. Those are company claims about the planned product, which has not yet entered the market.

MUFG confirmed its participation through a separate release dated Sept. 2. BBVA also published the consortium announcement through its corporate news service. No later disclosure had named the operating company or assigned specific roles to individual members.

USD stablecoin plan grew from a 10-bank study

The project follows an October 2025 announcement in which 10 banks said they were studying a 1:1 reserve-backed form of digital money available on public blockchains.

The latest announcement expands that initial group to 21 institutions and moves the project from exploration toward establishing a dedicated company.

However, the consortium has not yet identified which public blockchains it will support. It has also not disclosed whether users will be able to hold and transfer tokens directly or whether access will depend on participating banks and approved service providers.

The product’s proposed user base is also broad. Wholesale use could include transfers between banks or large companies. Institutional uses could involve settlement for tokenized securities and other digital assets. Retail applications could include payments, although the consortium has not released a consumer distribution plan.

The planned token would enter a market currently led by established issuers such as Tether and Circle. The banks may compete through their existing customer relationships, compliance systems and access to payment infrastructure. Those potential advantages remain untested until the venture publishes its operating model and launches the token.

Traditional banks are also considering separate approaches. JPMorgan has held early discussions about a possible stablecoin, although the bank said it had no active launch plan and would assess customer demand and regulation, as crypto.news reported.

GENIUS Act rules remain unfinished before launch

The consortium said the dollar stablecoin “intends” to comply with the U.S. GENIUS Act where applicable. President Donald Trump signed the legislation on July 18, 2025, creating a federal framework for payment stablecoin issuers.

The law establishes licensing and supervision requirements. It also calls for stablecoins to be backed one-to-one by eligible liquid reserves, provides redemption protections and requires regular reserve disclosures. Issuers cannot pay interest or yield solely for holding a covered payment stablecoin.

Several implementing regulations were still unfinished after federal agencies missed a July 18, 2026 rulemaking deadline. The Office of the Comptroller of the Currency has proposed reporting requirements that include confidential weekly reports and quarterly financial submissions for issuers under its authority.

The OCC is targeting November 2026 for final rules, as crypto.news reported. The statute’s timing could place the federal framework into effect around the period when the bank consortium is preparing its 2027 launch.

That schedule gives the venture time to incorporate final reserve, capital, redemption, custody and compliance requirements into the product. It also leaves uncertainty because several details may change before regulators complete their work.

The Treasury Department is separately developing rules for state regulatory recognition and foreign stablecoin issuers. In related coverage, Treasury requested public feedback on licensing standards and the interaction between federal and state supervision.

A euro token would face MiCA requirements

The consortium also said it “intends” to comply with the European Union’s Markets in Crypto-Assets regulation when applicable. MiCA already provides a regulatory structure for stablecoins offered in the bloc.

A token pegged to one official currency, such as the euro, generally falls within MiCA’s electronic money token category. Issuers face authorization, reserve, disclosure and redemption requirements, with additional supervision possible if a token reaches regulatory importance thresholds.

The consortium did not say which legal entity would issue its planned euro token or where that issuer would be licensed. Those choices will determine the relevant supervisory authority and the obligations assigned to participating institutions.

Operating across the U.S. and European Union will also require coordination between regulators. The Financial Stability Board recommends comprehensive supervision and cross-border information sharing for global stablecoin arrangements because their functions can span banking, payments and securities markets.

Ethena has moved beyond synthetic-dollar trading with the launch of Ethena Pay, a crypto-native “global money app” designed to make its USDe stablecoin usable for everyday payments, savings, and cross-border transfers.

Announced in a Tuesday post on X, the self-custodial app is built around holding USDe in a dollar-denominated balance, earning up to 6% annualized rewards, and spending via a payment card. Ethena says fiat access is supported through onboarding tools that convert deposits into USDe.

Key takeaways

• Ethena Pay turns USDe into a wallet-based balance for payments, savings, and transfers, with up to 6% annualized rewards for eligible users.
• In the beta, Ethena will begin with 400 users, expanding access weekly across 48 countries.
• Avalanche is listed as the exclusive settlement layer for payments and transfers.
• The app supports moving money using IBAN details and local-currency rails, but is not initially available in the US, EU, Canada, Taiwan, or South Korea.
• USDe’s market has continued to scale: DefiLlama data cited by Ethena’s report puts USDe at roughly $4.1 billion market cap, while ENA is up sharply in recent weeks.

Ethena Pay: a USDe-focused wallet for spending and transfers

Ethena positions its new product as a “money app” rather than a pure trading interface. According to the Tuesday announcement, users can deposit fiat or crypto, after which funds are converted into USDe (USDe) to create a dollar-denominated balance inside the app.

The product is also designed for external transfers. Ethena says users will be able to use IBAN details to move funds between bank accounts and settle into local currencies. For payment execution, Ethena Pay includes a payment card flow that allows users to spend their USDe balance, while also offering fiat onramps to fund the wallet.

Ethena further notes that MoonPay-owned Iron supplies backend infrastructure for the service.

Where the beta starts—and where it doesn’t

The rollout is structured as a limited beta across broad regions, including Latin America, the Caribbean, Africa, and parts of Asia. Ethena said the beta spans 48 countries, but access is initially restricted to 400 users, with availability expanding weekly.

There’s also a clear geography boundary for regulatory or operational reasons. Ethena Pay is not initially available in the United States, the European Union, Canada, Taiwan, or South Korea. Ethena indicated it expects to expand into those markets during the beta, subject to regulatory approval.

For investors and users watching stablecoin “real use” narratives, the staged launch matters: it suggests Ethena is testing both product mechanics (on/off ramps, card spend, transfer rails) and compliance constraints in select regions first, rather than attempting a full global release immediately.

Why the settlement choice matters: Avalanche for transfers

A key technical detail in the announcement is settlement. Ethena says Avalanche will serve as the exclusive settlement layer for Ethena Pay’s payments and transfers.

This matters because the user experience of a payments product depends not just on custody and user interfaces, but also on how value is processed behind the scenes—especially for cross-border activity. By naming a single settlement layer, Ethena is effectively narrowing one major variable for the beta: how transfers are finalized and coordinated as transactions scale.

As Ethena expands the app in waves, traders and ecosystem builders will likely watch whether the payment and transfer flows remain consistent in speed and reliability across regions, and whether the company adds settlement options later or keeps Avalanche exclusively for the broader rollout.

USDe and ENA: growth backdrop for the payments push

USDe is the synthetic dollar that underpins Ethena Pay. Ethena describes it as an Ethereum-based protocol designed to keep its value close to $1 without relying on traditional banking infrastructure.

According to the information provided, USDe maintains its peg using crypto collateral and hedging strategies, including derivatives positions. Ethena’s announcement cites DefiLlama data indicating USDe has reached a market capitalization of about $4.1 billion, which it characterizes as making it the sixth-largest stablecoin by market cap.

Ethena also operates ENA, its governance token. The same coverage notes ENA’s market capitalization at roughly $1.5 billion, and says the token has rallied about 68% over the past month, though it remains below earlier highs.

Separately, the Ethena Foundation proposed on Friday directing 95% of the net revenue it receives from Ethena’s core businesses toward ENA buybacks, conditional on USDe’s circulating supply reaching $7.5 billion. Following that proposal, Ethena’s reporting states ENA rose more than 10% and then added 27% over the week.

On the market data side, the article cites CoinGecko for ENA trading information, including a reference trading price around $0.16 on Tuesday. It also references trading volume of about $595 million over the past 24 hours, up 16% from the previous day.

What to watch next

With Ethena Pay moving into a limited, multi-country beta, the key question is whether the app can translate USDe’s stablecoin mechanics into dependable payments and transfer experiences at scale. As access expands weekly and Ethena seeks regulatory approval for additional regions, users and market observers should watch for improvements in coverage, any changes to settlement approach, and how USDe adoption in real-world rails affects demand for both USDe and ENA.

Hyperliquid Strategies expanded its equity financing facility with Chardan Capital Markets from $1 billion to $2.5 billion on Sept. 1, according to a new U.S. Securities and Exchange Commission filing.

The Nasdaq-listed company can raise funds over time by selling newly issued PURR shares to Chardan. Hyperliquid Strategies previously said proceeds from the facility could support general corporate purposes, including potential purchases of HYPE, the native token of the Hyperliquid network.

The $2.5 billion commitment represents the facility’s maximum aggregate capacity. It does not mean the company has received that amount, completed an offering of that size or committed the proceeds to buying HYPE.

Actual proceeds will depend on the number of shares sold and the prices at which transactions occur. Each issuance would also increase PURR’s outstanding share count, creating potential dilution for existing investors.

Hyperliquid Strategies adds $1.5 billion in capacity

Hyperliquid Strategies and Chardan signed the amendment to their ChEF purchase agreement on Sept. 1. The original agreement dates to Oct. 22, 2025.

The amendment raises the total commitment by $1.5 billion. Chardan can purchase newly issued common shares from Hyperliquid Strategies after the company submits qualifying purchase notices under the agreement.

Hyperliquid Strategies controls the timing and amount of individual sales. Its SEC disclosures state that financing decisions will depend on market conditions, PURR’s trading price and management’s assessment of how the proceeds should be deployed.

The arrangement differs from a traditional loan. Selling shares does not create principal repayments or interest expenses. However, the company exchanges equity for cash, reducing the percentage ownership represented by each existing share.

The facility also does not guarantee that Chardan will purchase $2.5 billion in stock. Transactions remain subject to the agreement’s terms, conditions and limitations. The amount ultimately raised could be lower than the maximum commitment.

Potential HYPE purchases remain optional

Hyperliquid Strategies said in its prospectus that proceeds from equity-facility sales were planned for general corporate purposes, including potential HYPE purchases.

That language gives management broad discretion. It does not establish a minimum HYPE allocation, purchasing deadline or fixed token target. The company could also direct proceeds toward operating expenses, transaction costs or other corporate requirements.

The Sept. 1 Form 8-K does not report a new HYPE acquisition. It also does not disclose whether Hyperliquid Strategies has completed share sales using the additional $1.5 billion of capacity.

Hyperliquid Strategies reported holding 29.3 million HYPE as of Aug. 19. Since completing its business combination in December 2025, the company had spent $773.4 million to acquire approximately 16.5 million tokens at an average price of $46.77, as crypto.news reported.

The company also reported $149.9 million in cash at the end of June and said it carried no debt. Its HYPE position had more than doubled from the roughly 12.6 million tokens associated with the company’s creation.

In related coverage, the transaction that formed Hyperliquid Strategies included $305 million in cash alongside the initial HYPE contribution. The company has since used equity financing as a central part of its token accumulation strategy.

Nasdaq rules limit lower-priced issuances

The amendment introduces an exchange cap that becomes relevant after aggregate share sales through the facility reach $1 billion.

After that threshold, Hyperliquid Strategies generally cannot sell more than 42,641,847 shares at prices below $12.02. The limit equals 19.99% of the common shares outstanding immediately before the amendment was executed.

The company can exceed the cap if shareholders approve additional issuances under Nasdaq rules. The restriction may also cease to apply if shareholder approval is not required under an available Nasdaq provision.

At $12.02 per share, 42,641,847 shares would represent approximately $512.5 million in gross proceeds. This calculation excludes fees and assumes every share is sold at the stated price.

The relationship between the share cap and the expanded commitment could restrict access to the full facility when PURR trades below $12.02. Raising the entire $2.5 billion may require higher sale prices, shareholder approval or an applicable Nasdaq exception.

The effect on existing investors will depend on the timing and size of each issuance. Selling shares at lower prices requires the company to issue more stock to raise the same amount of cash, increasing dilution.

PURR closes below the amendment’s threshold

PURR closed at $11.36 on Sept. 1, down approximately 7.3% during regular trading. The stock opened at $11.76 and traded between $11.03 and $12.31. Volume reached about 24.3 million shares.

The closing price placed PURR below the amendment’s $12.02 reference level. However, the market price does not activate the exchange cap by itself. The restriction concerns completed below-threshold sales after cumulative facility purchases reach $1 billion.