Crypto World
Hong Kong working to allow perpetual contracts, chief regulator says
HONG KONG — Financial regulators in Hong Kong are going to unveil a framework for trading platforms to offer perpetual contracts, the head of the region’s Securities and Futures Commission said Wednesday.
Brokers in Hong Kong will soon be able to provide financing to clients backed by bitcoin and ether and platforms will be able to offer market-making through independent units, said Julia Leung, the CEO of Hong Kong’s SFC at CoinDesk’s Consensus Hong Kong conference.
While the SFC plans to share more details later, the moves are part of the regulator’s broader push to let regulated firms offer more products and services, Leung said, following on its 2025 roadmap which included an effort to develop the local crypto market.
The SFC has already published the conclusions from its consultation on custody and related issues, but these new initiatives are focused on continuing to develop these markets in Hong Kong, including with novel products like perpetual futures contracts.
“We will be publicizing a high-level framework for platforms to be offering perpetual contracts,” she said.
These products will only be available for institutional investors, not retail clients, at this time, she said, and the framework will focus on risks. Platforms seeking to offer these products will need to be able to manage those risks, “and it also has to be very fair to the customers.”
On the other initiatives, Leung said that the SFC will start sharing further details soon.
“We will allow brokers to provide financing to clients with strong … credit profiles, and the collateral will be backed by both securities as well as virtual assets,” she said. “Because virtual assets … many of them are very volatile, so we’ll start with two that will be eligible as collateral, bitcoin and ether.”
Platforms looking to engage in market-making will need to make sure they have strong conflict-of-interest rules and independent market-making units, she said.
A White House meeting on stablecoin yield and rewards ended without a deal, but participants described the discussions as more productive than previous talks, according to details shared by journalist Eleanor Terrett.
Summary
- White House stablecoin yield talks ended without a deal, but both banks and crypto firms described the meeting as more productive than earlier discussions.
- Banks introduced written “prohibition principles” and signaled limited flexibility by acknowledging potential exemptions for transaction-based stablecoin rewards.
- The White House urged both sides to reach an agreement on stablecoin rewards regulation by March 1, with further talks expected soon.
The gathering brought together senior banking executives, crypto industry leaders, and policy staff to debate whether and how stablecoin issuers should be allowed to offer yield or rewards.
While no compromise was reached, negotiations moved into more detailed territory.
White House stablecoin talks show progress but no final deal
Banking representatives arrived with a written set of “prohibition principles” outlining firm red lines around stablecoin rewards. These principles detailed what banks are willing to accept and where they refuse to budge.
One notable shift emerged. Banks included language allowing for “any proposed exemption” related to transaction-based rewards.
Sources described this as a meaningful concession, as banks had previously declined to discuss exemptions altogether.
Much of the debate centered on “permissible activities.” This refers to what types of account behavior would allow crypto firms to offer rewards. Crypto companies pushed for broad definitions. Banks argued for narrower limits to reduce risk and regulatory exposure.
Ripple’s Chief Legal Officer Stuart Alderoty said that “compromise is in the air,” signaling cautious optimism despite unresolved issues.
March 1 deadline looms as talks continue
The meeting was smaller than the first White House session on stablecoins. It was led by Patrick Witt, Executive Director of the President’s Crypto Council. Staff from the Senate Banking Committee were also present.
Crypto attendees included representatives from Coinbase, a16z, Ripple, Paxos, and the Blockchain Association. Major banks in attendance included Goldman Sachs, JPMorgan, Bank of America, Wells Fargo, Citi, PNC, and U.S. Bank, alongside leading banking trade groups.
The White House has urged both sides to reach an agreement by March 1. Further discussions are expected in the coming days. However, it remains unclear whether another full-scale meeting will be held before the deadline.
[PRESS RELEASE – Vaduz, Liechtenstein, February 9th, 2026]
xMoney ($XMN) is expanding its partnership with Domino’s, bringing its payment infrastructure to Domino’s Greece following a successful rollout in Cyprus.
The collaboration focuses on acquiring services, enabling Domino’s Greece to accept card payments and digital wallets, including Apple Pay and Google Pay, across both web and mobile ordering platforms.
At the core of the integration is xMoney’s embeddable checkout solution, designed to deliver a seamless payment experience without redirection. Customers complete their orders faster, while all sensitive payment data is securely handled by xMoney’s compliant infrastructure.
The expansion was announced in person at a community event hosted at SuiHub Athens – a community space established to support builders and Sui ecosystem partners – bringing together the xMoney and Sui teams, Domino’s representatives, and building on xMoney’s previously announced work with Sui to expand real-world payment access across Europe.
“Domino’s operates in a high-volume, real-time environment where speed and reliability are critical,” said Manos Tsouloufris, CTO of Daufood. “xMoney’s checkout solution supports multiple payment methods in a single, seamless flow, helping us serve customers faster at scale.”
While the current implementation focuses on fiat payments, the two teams are also exploring future possibilities around digital asset payments, where network speed, user experience, and confirmation times make sense for real-world commerce.
The launch in Greece represents the next step in a broader European expansion, reinforcing xMoney’s role as a trusted payments partner for brands that operate at scale and its presence within the Sui ecosystem reflects a growing focus on practical, consumer-facing payment experiences built for everyday use.
“When people order food, they don’t think about payments, and that’s exactly the point,” said Gregorious Siourounis, Co-Founder and CEO of xMoney. “Our role is to make checkout fast, reliable, and invisible, so brands like Domino’s can focus on their customers. Bringing this experience to Greece is a natural next step.”
As xMoney expands across markets and merchant use cases, XMN supports the broader ecosystem by aligning long-term participation and infrastructure growth across the network. Designed to sit alongside xMoney’s licensed payment rails, XMN helps structure how value, incentives, and future on-chain capabilities evolve, without impacting the simplicity of everyday checkout experiences.
Faster checkout. Less friction.
Payments that deliver.
About Domino’s
Founded in 1960, Domino’s Pizza is the largest pizza company in the world, with a significant business in both delivery and carryout pizza. It operates a network of company-owned and independent franchise stores in the United States and more than 90 international markets.
About xMoney
xMoney is revolutionizing the payments landscape with strategic European licenses, delivering a seamless, secure, and forward-thinking ecosystem powered by innovative product design, cutting-edge technology, and unwavering compliance. XMN, xMoney’s newly launched token, is natively integrated into the licensed and regulated payment infrastructure – empowering merchants and consumers with lightning-fast, trustworthy transactions underpinned by full regulatory transparency. Now trading on Kraken, KuCoin, MEXC, Bitvavo, Bluefin and other exchanges, XMN is primed for broader adoption with a robust pipeline of integrations ahead.
Contact details:
Website: www.xmoney.com
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The days of outsized gains in crypto may be coming to an end as more risk-averse institutional players are entering the space, replacing retail investors who chase rapid gains, according to Galaxy CEO Mike Novogratz.
Novogratz reportedly said at the CNBC Digital Finance Forum on Tuesday in New York that it reflects the maturing industry.
“Retail people don’t get into crypto because they want to make 11% annualized,” he said. “They get in because they want to make 30 to one, eight to one, 10 to one,” he said.
Novogratz referenced FTX’s collapse in 2022, which resulted in a bear market that saw Bitcoin (BTC) prices fall 78% from $69,000 to $15,700 in November that year, stating that there was a “breakdown in trust” then.
Novogratz also acknowledged that the Oct. 10 leverage flush, which he called a significant event that “wiped out a lot of retail and market makers,” and increased selling pressure — though there wasn’t any major catalyst.
“This time, there’s no smoking gun,” he said. “You look around like, what happened?”
“Crypto is all about narratives, it’s about stories,” he said. “Those stories take a while to build, and you’re pulling people in … so when you wipe out a lot of those people, Humpty Dumpty doesn’t get put back together right away.”
Tokenized real-world assets will drive markets
Novogratz said he expects the industry to shift from high-return speculation to more practical applications, such as tokenized real-world assets that offer steadier returns.
However, some traders will always speculate, said Novogratz, but it’s going to be “transposed or replaced by us using these same rails, these crypto rails, to bring banking [and] financial services to the whole world. And so, it’s going to be real-world assets with much lower returns.”
Related: Chainlink co-founder’s 2 reasons this bear market feels different
Chainlink co-founder Sergey Nazarov made a similar argument on Tuesday, stating that tokenized RWAs will “surpass cryptocurrency in the total value in our industry, and what our industry is about will fundamentally change.”
Long-term Bitcoin believers will be fine
David Marcus, the co-founder and CEO of Lightspark and a former PayPal executive, told Bloomberg on Tuesday that there has also been a shift in who is holding Bitcoin.
“It’s just a change of who’s holding Bitcoin, and you’re moving from people that had long-term belief and were holding Bitcoin directly to just access to Bitcoin being wired off to our financial system and markets.”
He added that the change in holders and the Oct. 10 leverage flush have changed the dynamic, but those who have long believed that Bitcoin is a “hedge to everything else that’s happening in the markets” will be fine.
Magazine: Bitcoin difficulty plunges, Buterin sells off Ethereum: Hodler’s Digest
As MEV threats intensify on Ethereum, researchers are pursuing cryptographic shields designed to cloak mempool data until blocks finalize. Fresh measurements show almost 2,000 sandwich attacks every day, draining more than $2 million from the network each month. Traders executing large WETH and WBTC swaps, as well as other liquid assets, remain exposed to front-running and back-running. The field has grown beyond early threshold-encryption experiments toward per-transaction designs that aim to encrypt a transaction’s payload rather than entire epochs. Early prototypes like Shutter and Batched threshold encryption (BTE) laid groundwork by encrypting data at epoch boundaries; now, per-transaction designs are being explored for finer-grained protection and potentially lower latency. The debate centers on whether real-world deployment on Ethereum is feasible or remains primarily in research channels.
Key takeaways
- Flash Freezing Flash Boys (F3B) proposes per-transaction threshold encryption to keep transaction data confidential until finality, using a designated Secret Management Committee (SMC) to manage decryption shares.
- Two cryptographic paths exist within F3B: TDH2 (Threshold Diffie-Hellman 2) and PVSS (Publicly Verifiable Secret Sharing), each with distinct trade-offs in setup, latency, and storage.
- Latency overhead from finality is modest in simulations: about 0.026% for TDH2 (197 ms) and 0.027% for PVSS (205 ms) with a committee of 128 trustees on Ethereum-like conditions.
- Storage overhead is a consideration: roughly 80 bytes per transaction under TDH2, with PVSS inflating as the number of trustees rises due to per-trustee shares and proofs.
- Deployment remains challenging: integrating encrypted transactions requires changes to the execution layer and may demand a major hard fork beyond The Merge; nonetheless, F3B’s trust-minimized approach could later find use beyond Ethereum, including sealed-bid auction contracts.
Tickers mentioned: $ETH, $WETH, $WBTC
Market context: The broader crypto environment continues to weigh on MEV mitigation efforts as developers seek privacy-preserving mechanisms that do not erode finality or throughput. The ongoing discussion touches on protocol upgrades, research benchmarks, and cross-chain applicability, with activity spanning academic papers, industry tooling, and governance proposals.
Why it matters
The MEV arms race has harsh consequences for liquidity and trader outcomes, especially in high-volume decentralized exchanges where sandwich-type strategies exploit visible mempool activity. By moving toward per-transaction encryption, proponents argue that the incentive to front-run could diminish, since collateralized decryption happens only after a transaction has reached finality. This could improve fair access to liquidity for both retail and institutional traders, while potentially reducing the aggressive search for edge cases that currently drive MEV. Yet, the effectiveness hinges on the cryptographic primitives’ resilience and the ecosystem’s ability to absorb the added complexity without eroding security guarantees.
From a builder’s perspective, the F3B framework presents a clear tension between privacy and performance. The TDH2 path emphasizes a fixed committee and a streamlined data footprint, while PVSS offers more flexibility by letting users select trustees but incurs larger ciphertexts and greater computational overhead. The simulations suggest that, when configured appropriately, privacy-preserving measures can coexist with Ethereum’s throughput and finality targets. However, achieving real-world deployment would demand careful coordination among clients, miners or validators, and ecosystem tooling to ensure compatibility with existing smart contracts and wallets.
Investors and researchers should watch how the incentive structures evolve. F3B’s staking and slashing regime aims to deter premature decryption and collusion, but no system is immune to off-chain coordination risks. If the mechanism proves robust, it could influence future designs for privacy in permissionless networks and inspire alternative approaches to secure computation in open ledgers. The potential applications extend beyond straightforward trades; encrypted mempools could also underpin privacy-centric auctions and other latency-sensitive, trust-minimized interactions where upfront data leakage would otherwise enable manipulation.
What to watch next
- Further experimental results and real-world testnet pilots evaluating F3B’s latency, throughput, and storage under varied network loads.
- Rigorously documented security analyses of TDH2 and PVSS in active blockchain environments, including proofs of correct decryption and resilience against malicious actors.
- Public discussion of integration strategies with the Ethereum execution layer, and whether any client, protocol, or governance changes could enable phased deployment.
- Exploration of F3B-style privacy techniques in non-ETH networks or sub-second blockchains to gauge broader applicability and performance trade-offs.
- Sealed-bid auction use cases and other cryptographic applications where encrypted bids remain hidden until a defined deadline, aligning with F3B’s post-finality execution flow.
Sources & verification
- Flash Freezing Flash Boys (F3B) — arXiv:2205.08529
- How batched threshold encryption could end extractive MEV and make DeFi fair again — Cointelegraph
- Applied MEV protection via Shutter’s threshold encryption — Cointelegraph
- The Merge — Ethereum upgrades: A beginner’s guide to Eth2.0 — Cointelegraph
- TDH2 (Threshold Diffie-Hellman 2) — Shoup et al. (paper)
Per-transaction encryption reshapes the MEV battle on Ethereum
Flash Freezing Flash Boys introduces a pivot from epoch-wide secrecy to transaction-level privacy. The core idea is to encrypt the transaction with a fresh symmetric key and then shield that key with a threshold-encryption scheme reachable only by a predefined committee. In practice, a user signs a transaction and distributes an encrypted payload along with an encrypted symmetric key to the consensus layer. The designated Secret Management Committee (SMC) holds decryption shares, but will not release them until the chain has achieved the required finality, at which point the protocol jointly reconstructs and decrypts the payload for execution. This workflow is designed to avert the exposure of transaction details during the propagation window, thereby reducing the opportunities for MEV-based manipulation.
Two theoretical treatments underpin the approach. TDH2, which relies on a distributed key generation (DKG) process to produce a public key and shares, pairs a fresh symmetric key with a ciphertext that the committee can unlock in a threshold fashion. PVSS, by contrast, uses long-term keys for trustees and Shamir’s secret sharing, allowing a user to distribute shares encrypted with each trustee’s public key. Each model is accompanied by a set of zero-knowledge proofs to deter malformed decryption data, addressing concerns about chosen-ciphertext attacks and decryption validity. The two paths present different performance profiles: a fixed committee streamlines setup and reduces per-transaction data size (TDH2), while PVSS offers flexibility at the cost of larger ciphertexts and higher computation. In practical terms, simulations on a PoS-like Ethereum environment suggest sub-second delays after finality—well within acceptable bounds for many DeFi operations—and minimal storage pressure per transaction under TDH2. The numbers, of course, depend on committee size and network conditions.
Yet, deployment remains a topic of debate. Even if encryption constructs behave well in simulation, integrating encrypted transactions into the execution layer would likely require substantial changes—potentially a hard fork beyond The Merge—to ensure compatibility with current contracts and wallet software. Nevertheless, the research marks a meaningful step toward privacy-enhanced DeFi, showing that it is possible to conceal sensitive data without sacrificing finality. The broader implication is that encrypted mempools could find application beyond Ethereum, in networks pursuing privacy-preserving, trust-minimized protocols where delayed or withheld execution is acceptable or desirable. For now, the path to real-world usage remains cautious and incremental, with F3B serving as a benchmark for what privacy-preserving MEV mitigation could look like in practice.
Aside from RAIN, the other notable gainers today are M and NEXO, while HYPE has lost over 5% of value.
Bitcoin’s price recovery attempts were once again halted at just over $70,000, and the asset now sits over a grand lower.
Most larger-cap altcoins have remained sluggish on a daily scale, aside from ZEC, which has jumped by 5.5%, and HYPE, which has dropped by over 5%.
BTC Stopped at $70K
The primary cryptocurrency’s recent price movements raised a lot of questions about the state of the market. The asset stood at $90,000 on January 28 but plunged hard in the following week or so. In fact, the culmination, at least for now, took place last Friday morning when it dropped to $60,000 for the first time in well over a year.
This meant that BTC had lost $30,000 in the span of under 200 hours. After such a calamity, it was expected that there would be some sort of rebound, which took place immediately on Friday. In a matter of less than one trading day, the cryptocurrency surged by $12,000 and tapped $72,000 by Saturday morning.
However, it couldn’t proceed further and slipped below $70,000, where it spent most of the weekend. It tried to initiate another leg up on Monday but was stopped on a couple of occasions at $71,000 and $72,000. It has declined slightly since that local peak and now sits at $69,000.
Its market cap has declined to $1.380 trillion on CG, while its dominance over the alts stands firm at 57%.
RAIN Keeps Going
Ethereum continues to fight to stay above $2,000 after a minor daily decline. TRX has slipped by a similar percentage as well. In contrast, XRP has jumped above $1.40 after a 3% increase. BNB, SOL, BCH, and ADA are also in the green, led by ZEC’s impressive 6% surge to $242.
HYPE, on the other hand, has dropped by 5.5% daily and now struggles below $30. RAIN has taken the main stage in terms of daily gains, having soared by almost 20% to well over $0.01. The other notable gainers now are NEXO, ASTER, and M.
The total crypto market cap has remained relatively still since yesterday at just over $2.420 trillion on CG.
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Defend American Jobs, an affiliate of crypto super political action committee (PAC) Fairshake, will reportedly spend $5 million to support crypto-friendly politician Barry Moore in his bid for the US Senate, according to Bloomberg.
A five-week campaign will start this week with ads on broadcast TV and the Fox News Channel featuring US President Donald Trump endorsing Moore, Bloomberg reported on Tuesday, citing a statement from Fairshake.
Super PACs raise money from corporations and associations; however, the committees can’t directly donate to or coordinate with political campaigns. Instead, they fund ads and other media to urge voters to support a specific candidate.
“We are proud to stand with Barry Moore, a leader who will fight for economic growth and make America the crypto capital,” Fairshake reportedly said in a statement.
Fairshake is one of the most prominent crypto-related PACs, backed by crypto companies including Coinbase and Ripple Labs.
It spent roughly $130 million during the 2024 US elections to support pro-crypto candidates. The election ended with a flood of elected officials with pro-crypto views.
Moore is labeled ‘strongly supportive’ of crypto
Moore was first elected to the US House in 2020 and was part of the US House Agriculture Committee, which included the Digital Asset Market Clarity Act on its agenda last year.
He has also expressed crypto-friendly sentiment in the past. In an X post on Dec. 5, he appeared to approve of Trump’s crypto stance and related executive orders.
“Crypto is not a fad. It is part of our future. It is part of Alabama’s future,” Moore said.
A survey of 500 Republican voters, reported by the Alabama Daily News, found that 26s would vote for Alabama Attorney General Steve Marshall if the election were held in February. About 17% said they would vote for Moore.
Related: Trump Bitcoin adviser David Bailey wants to create a $200M PAC
Both have a rating of “strongly supportive” of crypto by advocacy organization Stand With Crypto, which compiles previous statements and actions to rate US politicians on their crypto stances.
Crypto PACs spend big on the industry
The US midterm primary elections are held in May, when each party will choose its nominee, followed by the general election on Nov. 3, when voters decide who will be elected.
Fairshake disclosed in January that it had amassed $193 million in cash ahead of the midterm elections. The Gemini Trust Company and Foris Dax, the parent company of Crypto.com, sent $21 million to a Trump-aligned PAC last year, which could also come into play in the midterms.
Magazine: 2026 is the year of pragmatic privacy in crypto — Canton, Zcash and more
TLDR:
- Banks accepted limited exemption language on stablecoin rewards after previously rejecting all transaction-based incentives.
- Crypto firms want broad definitions of permissible activities, while banks seek tighter limits to protect deposit structures.
- The White House urged both sides to reach a stablecoin deal before March 1 to sustain legislative momentum.
- A smaller meeting size allowed more detailed policy language discussions than earlier White House sessions.
A smaller White House meeting brought banks and crypto firms closer on stablecoin policy but stopped short of agreement.
Participants described the discussion as more detailed and more focused than earlier sessions. Officials pressed both sides to resolve disputes over rewards and account activity rules. A March 1 deadline now shapes the next phase of negotiations.
White House Stablecoin Talks Focus on Rewards and Exemptions
The meeting centered on whether crypto companies can offer rewards tied to stablecoin transactions. Banks arrived with written principles outlining limits they would accept.
One key shift emerged around conditional exemptions. Banking groups signaled openness to limited carve-outs after earlier resistance to any transaction-based rewards.
Crypto firms pushed for broad definitions of what counts as permissible account activity. Banks argued that narrower language would better protect traditional deposit models.
According to reporting by Eleanor Terrett, both sides called the session productive despite failing to reach a final compromise. Deal terms received deeper technical discussion than in prior meetings.
Ripple’s chief legal officer Stuart Alderoty said the atmosphere suggested growing willingness to bridge gaps. He also pointed to continued bipartisan momentum for crypto market structure legislation.
The White House urged participants to settle core disagreements before March 1. Officials framed the deadline as necessary to keep legislative progress on track.
Banks and Crypto Narrow Differences on Stablecoin Policy Scope
This gathering included fewer participants than the first White House session. It was led by the executive director of the President’s Crypto Council, Patrick Witt.
Crypto attendees included representatives from Coinbase, Ripple, Paxos, Andreessen Horowitz, the Blockchain Association, and the Crypto Council for Innovation.
Major banks present were Goldman Sachs, JPMorgan, Bank of America, Wells Fargo, Citi, PNC Bank, and U.S. Bank. Trade groups such as the ABA and ICBA also joined.
Senate Banking Committee staff attended, signaling legislative interest in the outcome of the talks. Their presence added pressure for measurable progress.
Discussion focused on defining “permissible activities” for accounts offering stablecoin rewards. Crypto firms sought flexibility to innovate, while banks stressed financial stability concerns.
Sources in the room said the tone was more constructive than earlier meetings. Participants exchanged draft language rather than general objections.
No final resolution emerged by the end of the session. However, further discussions are expected in the coming days among the same parties.
The White House continues to position itself as a mediator between financial institutions and crypto companies. Officials want an agreement that can inform broader stablecoin and market structure rules.
A White House-brokered meeting between crypto and bank representatives to reach an agreement on stablecoin provisions in the market structure bill has been described as “productive,” but remains unresolved.
“Productive session at the White House today — compromise is in the air,” Ripple legal chief Stuart Alderoty, one of the meeting’s attendees, posted to X on Tuesday.
“Clear, bipartisan momentum remains behind sensible crypto market structure legislation. We should move now — while the window is still open,” he added.
Congress is looking to pass a bill to define how US market regulators are to police crypto. The House passed a similar bill, the CLARITY Act, in July, but the effort has stalled as the Senate Banking Committee has yet to garner enough bipartisan support to advance it.
Momentum to advance the bill was lost when major crypto lobbyist Coinbase pulled its support for the bill last month over provisions that would prohibit all yield payments tied to stablecoins.
Banking lobbyists have argued that yield payments to stablecoin holders on third-party platforms such as exchanges pose a risk to bank deposits and could undermine the banking system.
Bankers, crypto flag need for more discussions
The meeting on Tuesday was the second in two weeks to bring banks and the crypto industry to the White House; the first on Feb. 2 was described by White House crypto adviser Patrick Witt as “constructive” and “fact-based.”
Dan Spuller, the industry affairs lead at crypto advocacy group the Blockchain Association, posted to X that the latest meeting “was a smaller, more focused session” with “serious problem-solving.”
“Stablecoin rewards were front and center,” he added. “Banks did not come to negotiate from the bill text, instead arriving with broad prohibitive principles, which remains a key disagreement.”
A handout given at the meeting by the banking groups reportedly listed “yield and interest prohibition principles” that should be included in the Senate’s crypto bill, reiterating the group’s push to ban all stablecoin yield payments.
Related: Crypto PACs secure massive war chests ahead of US midterms
Three major banking groups, the American Bankers Association, the Bank Policy Institute, and the Independent Community Bankers of America, said in a joint statement that “ongoing discussions” were needed to move the legislation forward.
They added that a “framework can and must embrace financial innovation without undermining safety and soundness, and without putting the bank deposits that fuel local lending and drive economic activity at risk.”
Meanwhile, BitGo CEO Mike Belshe said that both crypto and banks “should stop re-litigating” the GENIUS Act, which banned stablecoin issuers from paying yield directly, to get the market structure bill across the line.
“That battle was fought. If you don’t like GENIUS, amend it,” he added. “Market structure has nothing to do with yield on stablecoins and must not be delayed further.”
Magazine: How crypto laws changed in 2025 — and how they’ll change in 2026
The new offerings are Spark Prime and Spark Institutional Lending.
Spark, an on-chain capital allocator incubated by Sky (formerly MakerDAO), on Wednesday, Feb. 11, launched Spark Prime and Spark Institutional Lending, two products aimed at institutional borrowers.
The products target the off-chain crypto lending market, which Spark estimates at about $33 billion as institutional participation in crypto continues to rise, according to a press release viewed by The Defiant.
Spark Prime enables institutions to use collateral across both centralized platforms and decentralized finance (DeFi) and supports margin trading and off-exchange settlement. Arkis’ technology handles collateral and risk management, while Spark provides liquidity.
Meanwhile, Spark Institutional Lending is designed for firms that want to operate via custodians. Through integrations with entities like Anchorage Digital, institutions can borrow from Spark-governed markets while keeping their assets in regulated custody.
“Institutional lending depends on reliable liquidity,” said Sam MacPherson, co-founder and CEO of Phoenix Labs (a core contributor to Spark). “Spark Prime applies on-chain liquidity in a way that fits how institutions already manage custody, risk, and scale.”
Spark currently allocates more than $9 billion in stablecoin liquidity across decentralized markets, according to the release. The protocol boasts $5.2 billion in total value locked (TVL), making it the ninth-largest DeFi platform. Its lending protocol, SparkLend, accounts for $2.5 billion of Spark’s TVL, according to DefiLlama.
The launch builds on Spark’s earlier collaborations. In early 2025, Coinbase rolled out a Bitcoin borrowing product that used Spark-managed USDC liquidity, with Spark supplying more than 80% of the funds. Borrowing volumes grew by about $500 million over the next three months, per the release.
Spark has also supported on-chain liquidity for PayPal’s stablecoin PYUSD, allocating around $500 million across stablecoin markets.
Spark’s native token, SPK, is down about 2% on the day, trading at $0.022, with $12 million in 24-hour trading volume, according to CoinGecko.
EMB: Feb. 11, 06:00 UTC
Decentralized finance (DeFi) protocol Spark is pushing one of DeFi’s deepest pools of stablecoin liquidity further into institutional markets, unveiling new lending infrastructure designed to connect on-chain capital with off-chain borrowers that have largely stayed outside DeFi.
The protocol introduced Spark Prime and Spark Institutional Lending in an announcement at Consensus Hong Kong 2025 on Wednesday.
The new offerings extend more than $9 billion in deployed stablecoin liquidity into products aimed at hedge funds, trading firms and fintechs that operate under traditional custody and compliance requirements. Off-chain crypto lending is estimated at about $33 billion, according to Galaxy, reflecting sustained demand from institutions that remain cautious about direct onchain exposure.
“This will be OTC crypto lending through a qualified custodian,” Sam MacPherson, co-founder of Phoenix Labs, the core contributor to Spark, told CoinDesk in an interview. “This market is much bigger than the DeFi lending market, and we’re able to issue the same kind of overcollateralized loans Maker has done since its inception, but with access to a much broader set of borrowers.”
Spark Prime introduces a margin lending model that allows borrowers to deploy collateral across centralized exchanges, DeFi venues and qualified custodians under a single risk framework. That structure improves capital efficiency for hedge funds pursuing strategies such as perpetual futures trading, while giving lenders more direct exposure to funding rates.
The system is powered by prime broker Arkis’ margin and liquidation engine, which can automatically unwind positions across venues if portfolio risk thresholds are breached.
Spark Institutional Lending is aimed at firms that prefer fully custodial participation. Through arrangements with providers such as Anchorage Digital, institutions can borrow against collateral held in regulated custody while accessing Spark-governed liquidity pools.
MacPherson said the design reflects hard lessons from past market failures. “The status quo is still unsecured lending to hedge funds, which can go horribly wrong,” he said. “By keeping positions overcollateralized and holding collateral with an intermediary, you dramatically improve safety for lenders.”
Spark has already supported institutional-scale deployments, supplying most of the liquidity behind Coinbase’s bitcoin borrowing product in 2025 and allocating hundreds of millions of dollars to support PayPal’s PYUSD. The new offerings formalize that approach into a broader institutional framework, positioning Spark as a conduit between on-chain stablecoin demand and off-chain capital markets.
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