The U.S. banking industry had effectively lobbied to halt the crypto industry’s market structure bill, the Digital Asset Market Clarity Act, over a dispute about the proper role for stablecoin rewards. But lawmakers continue to negotiate a compromise to move that legislation forward.

One of the lawmakers at the center of those talks, Senator Angela Alsobrooks, told an audience at an American Bankers Association summit in Washington on Tuesday, that both sides of the negotiation — bankers trying to limit most stablecoin rewards as a threat to traditional deposits and the crypto industry that argues they’re an important consumer incentive — are going to be “just a little bit unhappy.” The Maryland Democrat has been working with Senator Thom Tillis, a North Carolina Republican, to hash out a way to get a long-delayed Senate Banking Committee hearing on the legislation.

“The compromise that myself and Senator Tillis have been working on is one that we believe will allow us to have the guardrails in place that will help us to prevent — in all the ways we can — the deposit flight that we do not want to see happen, and to allow the innovation to grow at the same time,” Alsobrooks said, referencing the banks’ insistence that rewards on stablecoin holdings are so similar to bank deposits that people will take their money out of the banks.

“We absolutely have to have these protections to prevent the deposit flight, but we’re going to probably have to make some compromises,” the senator said.

So far, the compromise seems to focus on the possibility that some narrower area of stablecoin activity be eligible for customer rewards paid by crypto platforms.

Last year’s stablecoin law, the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, “barred payment stablecoin issuers from paying interest to attract customers,” noted ABA President Rob Nichols. He argued that “unless crypto exchanges and other affiliated companies are bound by the same common-sense restrictions, the result is a clear effort to evade congressional intent.”

Senator Mike Rounds, a South Dakota Republican who — like Alsobrooks and Tillis — is a member of the Senate Banking Committee, told the banks on Tuesday that he’s “not sure” how to properly approach stablecoin rewards, yet. He said that handing out rewards to customers can’t be about how much money is held in an account, but it might be tied to how active the account is.

“We’re trying to reflect that in the discussions,” he said.

The bankers, who were preparing Tuesday to disperse to meetings across Capitol Hill to make their points with lawmakers and staffs, have pushed for a very narrow allowance for rewards. But JPMorgan Chase & Co. CEO Jamie Dimon, the leader of the biggest U.S. institution, suggested in a recent interview that his industry could accept transaction-based rewards — a position that’s been offered by the crypto industry in meetings at the White House.

The U.S. Office of the Comptroller of the Currency recently proposed a rule to adopt much of the GENIUS Act, though its position on stablecoin rewards was seen as murky by the crypto industry. The agency had said that it wouldn’t allow evasions of the yield ban for stablecoin issuers. But industry insiders have expressed comfort that they’ll be able to set up rewards programs that won’t run afoul of the OCC’s proposal, which the digital assets advocates say allows considerable room for rewards programs designed as customer incentives.

Despite the bankers further underlining the dangers of the yield loophole on their business model this week, the legislation could still advance if Alsobrooks, Tillis and others on the Senate Banking Committee are satisfied with new compromise language. The next step would be a markup hearing, like the one delayed earlier this year. If the bill passes that, it would be combined with a version that already cleared the Senate Agriculture Committee.

A final version would then be put before the entire Senate for a vote, which would require a considerable number of Democrats to pass.

That may remain a concern because other debates beyond stablecoin yield have gone unresolved. Senate Democrats have raised concerns about the decentralized finance (DeFi) sector posing vulnerabilities to bad actors, and they’ve also argued that Democrats be appointed to vacant roles at the CFTC and SEC. But possibly the most contentious of their requests is to ban senior government officials from profiting on personal crypto business ties — most pointedly, President Donald Trump.

There are procedural headwinds, too. Senate floor time is always at a premium, and other matters could still get in the way, such as the war in Iran and Trump’s threats that he won’t sign any approved bills until Congress sends him a voter-ID package he can sign into law before the midterm congressional elections.

Read More: Market structure state of play: State of Crypto

Nigel Farage aide George Cottrell is betting $41,000 that the US war with Iran will last for another four months, despite Reform UK calling for an end to the conflict. 

When Israel and the US attacked Iran in February, Farage criticised UK Prime Minister Keir Starmer for not allowing the US access to its military bases.   

Reform maintained its position that the US-led war should be backed by the UK before the party u-turned this week. 

Indeed, Reform politician Robert Jenrick called for the war to end “as soon as possible” because of its potential negative impact on the UK economy. 

Farage added today that the UK should stay out of the war, but only because of perceived shortcomings in the country’s defensive capabilities following a drone attack in Cyprus. 

However, despite this change in direction from the party, Cottrell was betting between March 7 and 9 that a ceasefire between the US and Iran wouldn’t happen before June 30, 2026. 

Read more: Reform UK insider George Cottrell tied to Trump Polymarket bets worth millions

The Polymarket bet stands to win $123,000 if the US keeps up its war against Iran for another four months. The bet’s market, however, doesn’t seem to agree, and his wager faces a current unrealised loss of -$6,240.

Nigel Farage says Cottrell ‘is like a son to me’

Cottrell, who has reportedly been Farage’s “right-hand man” for years, was convicted of wire fraud in March 2017 after he was caught agreeing to launder drug trafficking proceeds. 

The financier lived in Montenegro, where he was accused of illegal political financing and was investigated over a crypto ATM’s usage. An avid gambler, he reportedly lost €20 million ($23 million) in a single poker game while in the country.

However, Cottrell’s recent Polymarket bets, including on Starmer’s departure, US strikes against Iran, and the vote share of New York’s newly elected mayor, Zohran Mamdani, have lost over $800,000.

For much of crypto’s history, the primary use case has been simple: buying tokens and trading them.

Now, some investors and builders believe the industry may be moving toward a different model altogether: earning crypto instead of buying it.

One version of that idea is what venture firm Multicoin Capital calls Internet Labor Markets (ILM) — networks in which users receive tokens by contributing work, resources or expertise.

“The reason people get their first crypto in the future won’t be because they bought it,” Sengupta said in an interview with CoinDesk. “It’ll be because they earned it.”

The concept has begun gaining attention, particularly in ecosystems like Solana, where a growing number of projects are experimenting with networks that reward users for performing verifiable tasks.

That shift — from speculation to earning — is at the heart of Internet Labor Markets, where users contribute work, resources or judgment to decentralized networks and receive tokens in return. If the model takes hold, Sengupta believes crypto could evolve into something closer to a global labor marketplace.

For most of crypto’s existence, participation meant converting traditional money into digital assets such as bitcoin, ether or solana before interacting with the ecosystem. ILMs flip that dynamic: instead of buying tokens first, users complete tasks and receive crypto as payment.

“The idea is simple,” Sengupta said. “There are two ways people enter crypto — they either buy in or they earn in.”

Over the past decade, most users followed the first route. But Sengupta believes the next wave will come from the second.

“If you have a system where you can issue new assets and move them around at super low cost,” he said, “you can coordinate labor globally.”

In practice, that labor can take many forms — contributing bandwidth, labeling data, reducing energy consumption or performing physical tasks tied to decentralized infrastructure.

“Someone starts a company to source something the market needs, and 50,000 people around the world can get paid for producing that labor,” Sengupta said.

The concept builds on earlier crypto experiments, such as decentralized physical infrastructure networks (DePIN) — a category of projects that has largely emerged from the Solana ecosystem — which reward participants for contributing resources, such as wireless coverage or mapping data.

But Sengupta believes the next phase goes beyond hardware.

“The system moves from just plugging in hardware to people doing more active work — contributing judgment, effort and time,” he said.

Instead of passive contributions, many ILM systems focus on discrete tasks that can be verified and paid for instantly. A network might reward users for labeling data, reporting local information, identifying bugs in code or completing real-world assignments.

The blockchain advantage

Blockchain infrastructure makes those systems possible because work can be verified and settled automatically.

In traditional employment systems, payments often require invoices, approvals and delays. ILMs replace that process with deterministic verification — confirming work was completed and paying contributors instantly through crypto rails.

Much of that work may ultimately intersect with artificial intelligence.

One example Sengupta points to is Grass, a network that allows users to share unused internet bandwidth through software installed on their devices. The bandwidth can then be used for data-scraping tasks to help train AI models.

Multicoin Capital is a crypto investment firm that manages a multi-billion-dollar token hedge fund. In January 2022, the firm said it raised $422 million for a venture fund backing early-stage blockchain startups.

“People around the world download the software, contribute spare bandwidth, and earn tokens for participating in the network,” he said.

But the model could evolve further.

“The next phase is not just scraping data, but humans applying discretion — labeling data, judging quality — in ways that only humans can,” he said.

In other words, the internet’s next generation of labor markets may involve humans collaborating with AI systems rather than competing against them.

Sengupta argues that AI could actually increase demand for distributed human contributors. As companies become smaller and more automated, they still depend on people for tasks that require judgment, verification or real-world execution.

AI may shrink core teams, he said, but it also increases the need for on-demand contributors — creating demand for systems that can source, verify, and pay those contributions globally.

If this vision materializes, crypto’s next users may not arrive through speculation at all — but through work.

Read more: Multicoin Capital co-founder Kyle Samani steps down after nearly a decade to pursue other areas of tech

Crypto-related hacks declined sharply in February, but attackers are increasingly targeting users through phishing campaigns and malicious wallet approvals — a shift suggesting they are focusing more on exploiting human behavior than on vulnerabilities in smart contracts.

According to Nominis’ monthly report, roughly $49 million was lost to crypto-related exploits in February.

A single breach involving Step Finance, a portfolio dashboard and analytics platform built on the Solana blockchain, accounted for the bulk of the losses, with attackers draining approximately $30 million.

The February figure marks a steep decline from the $385 million stolen in January. While one month of data does not necessarily indicate a sustained trend, the drop suggests that large-scale protocol exploits were less prevalent during the period.

Social engineering attacks caused more cumulative damage than traditional smart contract exploits, Nominis said, with phishing campaigns increasing sharply during the month. These attacks typically trick users into interacting with malicious links or signing fraudulent transactions.

Private individuals were the most common victims, rather than centralized exchanges or decentralized finance protocols.

The most prevalent attack method was authorization abuse, in which victims unknowingly granted wallet permissions that allowed attackers to move funds from their accounts.

The figures broadly align with separate reporting from blockchain security company PeckShield, which estimated that February crypto exploits totaled $26.5 million, the lowest monthly losses since March 2025. PeckShield attributed the decline partly to stronger risk controls and improved security practices across the industry.

Related: South Korea sells $21.5M in recovered Bitcoin after custody breach

Crypto security improving, but major exploits persist

Hacks and scams have been a persistent feature of the cryptocurrency industry since its early days, though exchanges and security firms say defenses are gradually improving.

Crypto exchange Bybit recently reported that its fraud-prevention system blocked more than $300 million in unauthorized withdrawals during the final quarter of last year. The company said it flagged roughly 350 high-risk fraud addresses and prevented around 8,000 users from falling victim to potential scams.

Despite improvements in detection systems, large-scale attacks remain a major risk for the industry. According to Chainalysis, crypto hacks resulted in $3.4 billion in cumulative losses last year, underscoring the scale of the threat.

Related: Google uncovers iOS exploit kit used in crypto phishing attacks