Key takeaways

• Stellar (XLM) is trading lower as bullish momentum fades.
• Derivatives data shows bearish positioning, with long-to-short ratios below 1 
• Positive funding rates indicate traders are still willing to maintain long positions despite the pullback.

Stellar (XLM) remains under pressure on Tuesday as the coin extends its recent pullbacks.

Although prices have weakened, derivatives and on-chain metrics suggest investor sentiment has not turned decisively bearish. 

Instead, market participants appear cautiously optimistic, with traders balancing expectations for a potential recovery against continued short-term weakness.

Derivatives data shows mixed sentiment

Recent derivatives metrics present conflicting signals for the digital asset. According to CoinGlass, XLM’s long-to-short ratio stands at 0.84, also near a one-month low.

A ratio below 1 indicates that short positions outnumber long positions, suggesting traders are increasingly betting on further downside.

However, funding rates tell a different story. XLM’s funding rates read 0.0058%, indicating that the bulls are still paying the bears. 

Positive funding rates mean traders holding long positions are paying those holding shorts, indicating that bullish positioning still outweighs bearish conviction among leveraged participants.

The divergence between positioning and funding suggests many investors remain cautiously optimistic despite the recent correction.

Stellar technical outlook: XLM holds above key support

Stellar continues to trade above its short-term moving averages, preserving a modest bullish bias despite recent weakness.

XLM is currently trading near $0.193, holding above the 50-day EMA at $0.1922 and the 100-day EMA at $0.1872

However, the token remains capped below the 200-day EMA at $0.1985 and the 61.8% Fibonacci retracement at $0.2001

These levels represent immediate resistance for the current recovery attempt. Technical indicators continue to lean slightly positive. The RSI remains near 48, reflecting bearish momentum, while the MACD stays above the zero line, suggesting underlying bullish momentum has not yet faded completely.

If the bulls regain control, XLM could rally towards the $0.1985 (200-day EMA) and $0.2001 (61.8% Fibonacci retracement).

A daily candle close above these levels would allow XLM to extend its rally towards the $0.2188, $0.2376, and $0.2607 resistance zones. 

However, if the bearish trend persists, XLM could drop below $0.1922 (50-day EMA) and $0.1872 (100-day EMA) in the near term.

A decisive close below these levels would expose lower demand zones at $0.1774, $0.1735 (78.6% Fibonacci retracement), and $0.1421 (major structural support)

Holding above the 50-day EMA would help preserve XLM’s near-term recovery, while a break below $0.1872 could shift momentum back in favor of sellers.

TLDR

• Tesla exceeded Wall Street expectations by producing 451758 vehicles during the second quarter.
• Tesla shares declined after the production update as investors remained concerned about profitability.
• Investors shifted their attention from production growth to vehicle margins and overall financial performance.
• Elon Musk’s long-term strategy around robotaxis, artificial intelligence, and autonomous driving remains central to Tesla’s valuation.
• The upcoming earnings report is expected to provide clearer insight into Tesla’s margins, cash flow, and future growth outlook.

Tesla (TSLA)reported stronger-than-expected second-quarter production, yet its shares declined after the update. The mixed reaction highlighted persistent concerns about profitability despite improving vehicle output. Investors now await the company’s earnings report for clearer evidence of financial strength.

Strong Production Eases Demand Concerns

Tesla produced 451,758 vehicles during the second quarter, beating most Wall Street expectations. The result suggested customer demand remained stronger than many analysts anticipated. The production update also eased concerns after a weaker first quarter.

The stronger figure supported the view that Tesla regained production momentum during the quarter. However, the market quickly shifted attention beyond headline production numbers. Investors focused on whether higher output would improve financial performance.

Production growth alone did not convince the market about Tesla’s long-term outlook. Instead, investors questioned whether discounts reduced profitability across vehicle sales. That concern limited enthusiasm despite the better-than-expected production result.

Tesla Stock Falls Despite Production Surprise

Tesla shares fell after the production announcement despite the positive surprise. The market reaction showed investors wanted stronger evidence than higher vehicle production. Many analysts believe revenue quality remains more important than delivery volume.

Meta Platforms, Inc., META

The company can deliver more vehicles while generating weaker profits through aggressive price reductions. That possibility remains a major concern for shareholders. Strong production therefore failed to remove questions about operating margins.

Tesla continues to trade at a premium compared with traditional automakers. That valuation creates higher expectations for earnings growth and future expansion. Investors therefore expect exceptional financial performance rather than ordinary automotive results.

Future Growth Remains the Central Focus

Chief Executive Officer Elon Musk continues to promote autonomous driving, robotaxis, artificial intelligence, energy storage, and humanoid robots. Those businesses remain central to the long-term investment case for Tesla. Supporters believe those technologies justify the company’s premium valuation.

Bullish investors argue the latest production figures prove Tesla recovered from earlier weakness. They believe the first quarter represented a temporary slowdown instead of lasting demand problems. The stronger production data strengthened that argument.

Bearish investors maintain Tesla must prove those vehicles generated healthy profits. They expect upcoming earnings to reveal margin trends and cash flow performance. Management commentary on pricing, robotaxis, and autonomous driving could also influence future sentiment.

The upcoming earnings report now represents the next major catalyst for Tesla shares. Investors expect updates on gross margins, operating income, and free cash flow. Those results will determine whether Tesla can support its premium valuation after the stronger quarter.

Non-custodial multichain cryptocurrency wallet Ctrl Wallet will shut down its services, weeks after a security exploit, and told users on Tuesday to withdraw their assets within the next month.

Ctrl Wallet reported a security issue on June 23 effecting some Cardano wallets on the platform and said it entered a temporary “maintenance mode” to protect user assets until its engineering team restores full functionality. 

Earlier today, the wallet’s operators announced that starting Aug. 3, 2026, sending, receiving, swapping funds and all other actions within the app will be unavailable, except for exporting users’ recovery phrases.

The app will be removed from both app and browser extension stores, while downloads will be halted immediately, Ctrl Wallet said in a blog post.

Ahead of the Aug. 3 deadline, users can transfer their assets from Ctrl Wallet to another exchange or crypto wallet. After that, users will only be able to import their recovery phrase into another compatible wallet provider. Ctrl Wallet “strongly” recommended that users export their assets before Aug. 3.

Source: Ctrl Wallet

Ctrl Wallet said that users can export their 12-word or 24-word recovery phrase into compatible wallets, including MetaMask, Trust Wallet and Phantom.

The wallet provider said there will not be a migration token or an airdrop event and urged users to exercise caution when encountering fake social media posts or websites promising similar incentives.

Ctrl Wallet, formerly XDEFI Wallet, lists between 11 and 50 employees and over 650,000 monthly users on its LinkedIn page. The wallet supported over 2,500 blockchain networks, including Cardano and Midnight.

Related: Dormant $1.9M Bitcoin tied to New York lawsuit moves after nearly 15 years

Ctrl Wallet transitions under the Emurgo umbrella before SecondFi exploit

On April 29, Ctrl Wallet announced its transition under the Emurgo umbrella and said that its multichain architecture will continue inside the SecondFi wallet.

SecondFi is a self-custodial platform built on Cardano that rebranded from the Yoroi wallet in April 2026 and was developed by Emurgo, the “for-profit arm of Cardano.”  

On June 24, a vulnerability in SecondFi enabled attackers to drain user funds, resulting in an estimated loss of around 16 million ADA, then worth about $2.4 million.

Days later, SecondFi revealed a recovery path to repay affected users across the 374 impacted wallet addresses. It also said it secured about 129 million ADA through emergency measures and transferred the funds to an independent third-party custodian, where they will remain until the verification and recovery process is complete. 

Magazine: SBF will never get a pardon, Trump peace deal boosts Bitcoin: Hodlers Digest June 14-21

The treasury of Solana-based memecoin project, BONK, has been drained of over $21 million, via a malicious governance proposal.

A single address, accounting for 882 billion BONK, voted in favor — just enough to reach quorum.

Apparent disinterest from other holders led to just six other voters, and the proposal passed with 99.9% of votes in favor.

The proposal, BIP 76, was submitted on June 30 and ostensibly aimed to implement a new “Sowellian” governance model.

However, the camouflage was somewhat lacking in sophistication, with just two proposed actions: “Add Metadata,” and “Send 4.426.104.450.305 Bonk to 9bxWkN…”.

Blockchain forensics firm Chainalysis traced the “days-long BONK spree” which saw one wallet acquire $8 million worth of tokens “on mainstream exchange[s] and borrowed via DeFi.”

By Monday, the address had enough tokens to pass the proposal and made its move on the final day of the voting period. The 4.4 trillion BONK tokens were transferred once voting ended.

Chainalysis explains the majority of funds were transferred to a multisig, which appears to be a new BONK 2.0 DAO. The tokens acquired for voting are being liquidated.

Read more: DeFi platform Summer Finance loses $6M in vault exploit

Governance ‘attack’ or voter apathy?

Draining a DAO treasury of $20 million may sound a lot like an attack but, with such a straightforward and poorly-disguised proposal sitting in an open governance voting forum for a week, the incident also clearly demonstrates a lack of interest from token holders.

Crypto security expert Taylor Monahan examined the “pretty subjective and loosely defined” definition of a governance attack. The community’s “gut reaction” suggests so, she believes, but whether or not it would constitute wire fraud is another question.

Conversely, a pseudonymous advisor to World Liberty Financial, Ogle, simply asked “isn’t this just a functioning DAO?”

Read more: WLFI token falls 18% as governance vote branded a ‘scam’

Perhaps expecting rigorous governance oversight from a community of dog-themed memecoin holders is asking too much.

Despite once being seen as DeFi’s answer to hierarchical corporate governance, the wider DAO governance dream has been struggling lately.

In recent months, turbulence has come for some of the sector’s most well-established examples, including the Ethereum Name Service, Aave, Gnosis and more.

Got a tip? Send us an email securely via Protos Leaks. For more informed news and investigations, follow us on X, Bluesky, and Google News, or subscribe to our YouTube channel.

Public blockchains have transformed how value moves across the internet. They offer instant settlement, global accessibility, 24/7 availability, and transparent record-keeping without relying on traditional intermediaries. For businesses, these advantages promise faster operations, reduced costs, and simplified financial reconciliation.

Yet the same transparency that makes public blockchains trustworthy also creates their greatest obstacle for enterprise adoption.

No corporation wants its competitors to monitor vendor payments, treasury balances, investment strategies, or trading positions in real time. Financial privacy is not a luxury—it is a competitive necessity.

This challenge has inspired one of blockchain’s most significant technological breakthroughs. Rather than abandoning public ledgers in favor of closed, permissioned systems, developers are building advanced cryptographic tools that preserve confidentiality while maintaining verifiable trust.

At the center of this transformation are Zero-Knowledge Proofs (ZKPs) and Fully Homomorphic Encryption (FHE). Together, they create a powerful privacy stack that allows organizations to prove information is correct and compute sensitive data without exposing the underlying details.

The result is a new model for enterprise blockchain adoption: trust without transparency.

Public blockchains were designed around openness. Every transaction, wallet balance, and smart contract interaction is visible to anyone with an internet connection.

For decentralized finance, this transparency improves accountability.

For corporations, however, it creates several critical risks:

• Competitors can monitor treasury movements.
• Trading strategies become publicly visible.
• Supplier payments reveal business relationships.
• Institutional orders become vulnerable to front-running.
• Sensitive financial information becomes permanently exposed.

These limitations have historically prevented many enterprises from embracing public blockchain infrastructure despite its operational advantages.

Instead of sacrificing privacy or abandoning public networks, cryptography is offering a third path.

Zero-Knowledge Proofs (ZKPs) answer a simple but powerful question:

Can you prove something is true without revealing why it is true?

The answer is yes.

Think of a ZKP as the API of trust.

Instead of sharing confidential information, a user generates mathematical proof that verifies a statement while keeping every underlying detail hidden.

Imagine proving you are over 18 years old without revealing your birthday, address, or even your identity.

Only the fact that matters is disclosed.

Nothing else.

Corporate Applications

Proof of Reserves

Banks, custodians, and exchanges can continuously demonstrate they have sufficient assets without disclosing portfolio composition.

Regulators receive verifiable assurance.

Competitors learn nothing.

Compliance Reporting

Financial institutions can automatically generate compliance reports every few minutes without exposing proprietary trading positions or confidential client information.

This enables real-time auditing while preserving corporate secrecy.

AML Verification

Instead of revealing wallet addresses publicly, institutions can prove statements such as:

• The sender is not sanctioned.
• The transaction complies with AML policies.
• Required identity checks were completed.

Observers verify compliance without learning who participated.

This concept is often described as compliant privacy.

Where ZKPs Reach Their Limit

Although extremely powerful, Zero-Knowledge Proofs primarily verify completed facts.

They excel at answering questions like:

• Is this statement true?
• Was this transaction valid?
• Did the protocol follow its rules?

However, they are not designed to perform continuous, complex computation on encrypted information.

That is where Fully Homomorphic Encryption enters the picture.

Fully Homomorphic Encryption: Computing Without Seeing

For decades, encryption has followed a familiar pattern:

1. Encrypt data.
2. Decrypt data.
3. Perform calculations.
4. Encrypt again.

The weakness is obvious.

Sensitive information must become visible during processing.

Fully Homomorphic Encryption changes that entirely.

With FHE, computers perform calculations directly on encrypted data without ever decrypting it.

The server never sees the original information.

It simply performs mathematical operations on encrypted values and returns an encrypted result that only the data owner can unlock.

It is often described as the holy grail of private computation.

Why 2026 Marks an Inflection Point

For years, Fully Homomorphic Encryption was viewed as theoretically revolutionary but practically too slow.

That perception is rapidly changing.

Advances in GPU acceleration, specialized FHE hardware, optimized cryptographic libraries, and threshold decryption have dramatically improved performance, making production deployments increasingly realistic for privacy-focused blockchain infrastructure.

Rather than remaining an academic concept, FHE is beginning to power confidential smart contracts and encrypted computation on specialized blockchain networks.

Corporate Applications of FHE

On-Chain Dark Pools

Institutional investors often execute enormous trades.

Publishing those orders publicly creates opportunities for:

• Front-running
• MEV exploitation
• Price manipulation
• Information leakage

With FHE, orders remain encrypted throughout execution.

Matching engines calculate outcomes without revealing order size, pricing, or participant identities.

Only the final settlement becomes visible.

Private Credit Scoring

Traditional lending requires exposing sensitive financial records.

FHE introduces a radically different approach.

Imagine a company submitting encrypted financial statements to a decentralized lending protocol.

The protocol evaluates:

• Cash flow
• Revenue stability
• Debt ratios
• Creditworthiness

Every calculation happens while the data remains encrypted.

The protocol never accesses the raw financial information.

Developers cannot inspect it.

Validators cannot read it.

Only the final lending decision is revealed.

The Hybrid Privacy Stack: Why ZKPs and FHE Work Together

It is tempting to think that Zero-Knowledge Proofs and Fully Homomorphic Encryption compete.

In reality, they solve different problems.

The strongest enterprise architectures combine both.

FHE performs the confidential computation.

ZKPs verify that the computation was executed correctly.

Example Workflow

Imagine an encrypted lending platform.

1. A borrower submits encrypted financial data.
2. FHE computes the company’s credit score.
3. The computation remains confidential throughout.
4. A Zero-Knowledge Proof is generated showing the calculation followed protocol rules.
5. The blockchain verifies the proof.
6. The loan is issued.

At no point does anyone except the borrower gain access to the underlying financial statements.

The blockchain verifies correctness without sacrificing confidentiality.

Together, these technologies create a complete privacy architecture rather than competing alternatives.

The Future of Enterprise Blockchain Privacy

Public blockchains were once considered unsuitable for corporate finance because openness and confidentiality appeared fundamentally incompatible.

That assumption is rapidly fading.

Modern cryptography has separated validity from visibility.

Organizations no longer need to expose confidential information to prove they are operating honestly.

This shift could reshape enterprise blockchain adoption over the coming years. Rather than relying on isolated permissioned blockchains—which often sacrifice liquidity, composability, and broad network effects—businesses may increasingly leverage public infrastructure enhanced with advanced cryptographic privacy.

In this emerging model, openness and confidentiality are no longer mutually exclusive.

They become complementary.

Final Thoughts

Enterprise adoption of Web3 will not be driven by transparency alone.

It will be driven by selective transparency—where every participant can verify correctness without accessing sensitive business information.

Zero-Knowledge Proofs provide verifiable trust.

Fully Homomorphic Encryption enables confidential computation.

Together, they transform public blockchains into secure environments capable of supporting banks, multinational corporations, institutional investors, and regulated financial markets.

In the next generation of enterprise Web3, privacy is not about concealing wrongdoing.

It is foundational infrastructure for protecting competitive advantage while participating in an open, globally connected financial system.

REQUEST AN ARTICLE

Bitcoin BTC$63,176.00 stalled on Tuesday, falling for the first time this month and breaking the longest stretch of gains since March. It had rallied to $64,500, its highest point in more than two weeks, on Monday.

Ether (ETH) tracked the larger cryptocurrency, dropping to $1,770 after hitting a high of $1,830 on Monday.

The July recovery can be attributed to a short-squeeze setup that was identified in late June, which saw heavy short interest despite bitcoin trading at its lowest point since 2024.

Bitcoin and other crypto tokens capitalized on a skew in short positions, recovering from oversold territory and advancing every day since the start of the month.

The total crypto market has grown by 8.4% since July 1, and is now worth $2.16 trillion.

U.S. equities fell in pre-market trading on Tuesday, with Nasdaq 100 index futures losing 0.9% since midnight UTC as the decline from June’s record high continues.

Derivatives positioning

• Over $500 million in leveraged crypto futures bets have been liquidated by exchanges in 24 hours, with shorts, or bearish positions, accounting for most of the tally for a sixth straight day.
• Despite the recent price strength, BTC’s futures open interest (OI) has slipped to 740K BTC, down from the July 3 high of 776K BTC. This shows that derivative traders are not participating in the price rise alongside a continued weakness in spot demand, as evidenced from ETF flows and the Coinbase premium. This raises questions about the sustainability of the gains.
• The same is true for ether (ETH), which recently outperformed BTC.
• OI in SOL has pulled back to 68 million tokens from the peak of over 76 million on June 24. The message is the same. The 10% rise in the token has so far failed to galvanize demand for leveraged plays.
• Canton Network’s CC token has declined by over 4% in 24 hours accompanied by a 3% uptick in the futures OI to 245.59 million tokens. This, coupled with negative funding rates and 24-hour OI-adjusted cumulative volume delta, points to a growing bearish bias.
• Most tokens have a negative OI-adjusted CVD, a sign of bears being more aggressive by shorting at market orders rather than passive limit order plays. It suggests potential for losses ahead.
• Bitcoin’s 30-day implied volatility index, BVIV, has jumped to 40%, snapping a six-day losing streak. Still, the gauge remains well below January highs near 60% in a positive sign for crypto bulls. The same is true for ether’s index, EVIV.
• On Deribit, options continue to showcase lingering downside concerns in both bitcoin and ether. Options volume in BTC paints a mixed picture with both calls and puts making it to the list of top traded bets in the past 24 hours.
• On decentralized exchange Derive, a large long call condor strategy on HYPE crossed the tape, indicating expectations for a range play between $75 and $80 till July 24.

Token talk

• The altcoin market continues to show internal contradictions. Tokens like FET, KASPA and WLD have all posted losses despite the broader marketwide recovery this week, while ETHFI and LIT have outperformed, adding more than 30% over the past seven days.
• WLFI$0.06039 was one of the top-performing tokens on Tuesday, rising 4.8. It’s worth noting that the token, linked to the family of President Donald Trump, is down by more than 89% since it was created last August.
• The decoupling of some altcoins demonstrates a maturing of the sector, with token performance based on underlying sentiment and onchain activity. Historically, the entire altcoin market moved in unison.
• CoinMarketCap’s Altcoin Season indicator is at 46/100, below Friday’s high and higher than in May, when it was consistently around 30/100.