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Impact, Risks, and Opportunities in the Digital Age

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Impact, Risks, and Opportunities in the Digital Age

Introduction

In recent years, deepfake technology has gained notoriety for its ability to create incredibly realistic videos and audio that can deceive even the most attentive observers. Deepfakes use advanced artificial intelligence to superimpose faces and voices onto videos in a way that appears authentic. While fascinating, this technology also raises serious concerns about its potential for misuse. From creating artistic content to spreading misinformation and committing fraud, deepfakes are changing how we perceive digital reality.

 

Definition and Origin of Deepfakes

The term `deepfake´ combines `deep learning´ and `fake´. It emerged in 2017 when a Reddit user with the pseudonym `deepfakes´ began posting manipulated videos using artificial intelligence techniques. The first viral deepfakes included explicit videos where the faces of Hollywood actresses were replaced with images of other people. This sparked a wave of interest and concern about the capabilities and potential of this technology. Since then, deepfakes have evolved rapidly thanks to advances in deep learning and Generative Adversarial Networks (GANs). These technologies allow the creation of images and videos that are increasingly difficult to distinguish from real ones. As technology has advanced, so has its accessibility, enabling even people without deep technical knowledge to create deepfakes.

 

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How Deepfakes Work

The creation of deepfakes relies on advanced artificial intelligence techniques, primarily using deep learning algorithms and Generative Adversarial Networks (GANs). Here’s a simplified explanation of the process:

Deep Learning and Neural Networks: Deepfakes are based on deep learning, a branch of artificial intelligence that uses artificial neural networks inspired by the human brain. These networks can learn and solve complex problems from large amounts of data. In the case of deepfakes, these networks are trained to manipulate faces in videos and images.

Variational Autoencoders (VAE):
A commonly used technique in creating deepfakes is the Variational Autoencoder (VAE). VAEs are neural networks that encode and compress input data, such as faces, into a lower-dimensional latent space. They can then reconstruct this data from the latent representation, generating new images based on the learned features.

Generative Adversarial Networks (GANs): To achieve greater realism, deepfakes use Generative Adversarial Networks (GANs). GANs consist of two neural networks: a generator and a discriminator. The generator creates fake images from the latent representation while the discriminator evaluates the authenticity of these images. The generator’s goal is to create realistic images that the discriminator cannot distinguish them from real ones. This competitive process between the two networks continuously improves the quality of the generated images.

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Applications of Deepfakes

Deepfakes have a wide range of applications that can be both positive and negative. 

Entertainment: In film and television, deepfakes rejuvenate actors, bring deceased characters back to life, or even double for dangerous scenes. A notable example is the recreation of young Princess Leia in `Rogue One: A Star Wars Story´ by superimposing Carrie Fisher’s face onto another actress.

Education and Art:
Deepfakes can be valuable tools for creating interactive educational content, allowing historical figures to come to life and narrate past events. In art, innovative works can be made by merging styles and techniques.

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Marketing and Advertising: Companies can use deepfakes to personalise ads and content, increasing audience engagement. Imagine receiving an advert where the protagonist is a digital version of yourself.

Medicine: In the medical field, deepfakes can create simulations of medical procedures for educational purposes, helping students visualise and practise surgical techniques.

 

Risks and Issues Associated with Deepfakes

Despite their positive applications, deepfakes also present significant risks. One of the most serious problems is their potential for malicious use.

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Misinformation and Fake News: Deepfakes can be used to create fake videos of public figures, spreading incorrect or manipulated information. This can influence public opinion, affect elections, and cause social chaos.

Identity Theft and Privacy Violation: Deepfakes can be used to create non-consensual pornography, impersonate individuals on social media, or commit financial fraud. These uses can cause emotional and economic harm to the victims.

Undermining Trust in Digital Content: As deepfakes become more realistic, it becomes harder to distinguish between real and fake content. This can erode trust in digital media and visual evidence.

 

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Types of Deepfakes

Deepfakes can be classified into two main categories: deepfaces and deepvoices.

Deepfaces: This category focuses on altering or replacing faces in images and videos. It uses artificial intelligence techniques to analyse and replicate a person’s facial features. Deepfaces are commonly used in film for special effects and in viral videos for entertainment.

Deepvoices: Deepvoices concentrate on manipulating or synthesizing a person’s voice. They use AI models to learn a voice’s unique characteristics and generate audio that sounds like that person. This can be used for dubbing in films, creating virtual assistants with specific voices, or even recreating the voices of deceased individuals in commemorative projects.

Both types of deepfakes have legitimate and useful applications but also present significant risks if used maliciously. People must be aware of these technologies and learn to discern between real and manipulated content.

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Detecting Deepfakes

Detecting deepfakes can be challenging, but several strategies and tools can help:

Facial Anomalies: Look for details such as unusual movements, irregular blinking, or changes in facial expressions that do not match the context. Overly smooth or artificial-looking skin can also be a sign.

Eye and Eyebrow Movements: Check if the eyes blink naturally and if the movements of the eyebrows and forehead are consistent. Deepfakes may struggle to replicate these movements realistically.

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Skin Texture and Reflections: Examine the texture of the skin and the presence of reflections. Deepfakes often fail to replicate these details accurately, especially in glasses or facial hair.

Lip Synchronisation:
The synchronisation between lip movements and audio can be imperfect in deepfakes. Observe if the speech appears natural and if there are mismatches.

Detection Tools: There are specialised tools to detect deepfakes, such as those developed by tech companies and academics. These tools use AI algorithms to analyse videos and determine their authenticity.

Comparison with Original Material: Comparing suspicious content with authentic videos or images of the same person can reveal notable inconsistencies.

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Impact on Content Marketing and SEO

Deepfakes have a significant impact on content marketing and SEO, with both positive and negative effects:

Credibility and Reputation: Deepfakes can undermine a brand’s credibility if they are used to create fake news or misleading content. Disseminating fake videos that appear authentic can severely affect a company’s reputation.

Engagement and Personalisation:
Ethically used, deepfakes can enhance user experience and increase engagement. Companies can create personalised multimedia content that better captures the audience’s attention.

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Brand Protection: Companies can also use deepfakes to detect and combat identity theft. By identifying fake profiles attempting to impersonate the brand, they can take proactive measures to protect their reputation and position in search results.

SEO Optimisation: The creative and legitimate use of deepfakes can enhance multimedia content, making it more appealing and shareable. This can improve dwell time on the site and reduce bounce rates, which are important factors for SEO.

 

Regulation and Ethics in the Use of Deepfakes

The rapid evolution of deepfakes has sparked a debate about the need for regulations and ethics in their use:

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Need for Regulation: Given the potential harm deepfakes can cause, many experts advocate for strict regulations to control their use. Some countries are already developing laws to penalise the creation and distribution of malicious deepfakes.

Initiatives and Efforts: Various organisations and tech companies are developing tools to detect and counteract deepfakes. Initiatives like the Media Authenticity Alliance aim to establish standards and practices for identifying manipulated content.

Ethics in Use:
Companies and individuals must use deepfakes ethically, respecting privacy and the rights of others. Deepfakes should be created with the necessary consent and transparency for educational, artistic, or entertainment purposes.

 

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Conclusion

Deepfakes represent a revolutionary technology with the potential to transform multiple industries, from entertainment to education and marketing. However, their ability to create extremely realistic content poses serious risks to privacy, security, and public trust. As technology advances, it is essential to develop and apply effective methods to detect and regulate deepfakes, ensuring they are used responsibly and ethically. With a balanced approach, we can harness the benefits of this innovative technology while mitigating its dangers.

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The SEC explains how it’s viewing a crypto security: State of Crypto

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The SEC explains how it's viewing a crypto security: State of Crypto

The U.S. Securities and Exchange Commission and Commodity Futures Trading Commission published interpretive guidance explaining how they might define what is or isn’t a security in crypto; the CFTC also issued a no-action letter for a non-custodial wallet provider to facilitate derivatives and prediction markets transactions; Arizona is filing criminal charges against a prediction market provider; and by the way we kind-of-sort-of have hints of movement on market structure legislation.

What a week, huh?

You’re reading State of Crypto, a CoinDesk newsletter looking at the intersection of cryptocurrency and government. Click here to sign up for future editions.

The narrative

The U.S. Securities and Exchange Commission published interpretive guidance this week — joined by the Commodity Futures Trading Commission — laying out how it approached the question of what in crypto it will deem a security.

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Why it matters

What is, and isn’t, a security has long bedeviled the industry. We had efforts at somewhat defining this from the SEC in the past — Bill Hinman’s “When Howey met Gary (plastics)” speech, for example — but this week’s interpretative guidance is one of the most specific efforts to define this for the industry.

Breaking it down

The SEC laid out several categories it saw in the crypto space, with one of these categories being digital securities. These are cryptocurrencies that meet the definition of a security under any other context, but happen to be tokenized, the guidance said. For example, if a crypto asset meets the prongs of the Howey Test, it’s a security.

This is the category of tokens the SEC will oversee.

Other categories include payment stablecoins, digital tools, digital collectibles and digital commodities, which are generally not securities unless the issuers or operators take actions that might meet securities regulations, such as fractionalizing the tokens in question.

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“We establish a straightforward taxonomy of crypto assets — most of which are not securities — and clarify how the Supreme Court’s Howey test applies when a crypto asset is part of an investment contract,” SEC Chair Paul Atkins and Commissioners Hester Peirce and Mark Uyeda wrote in an oped for CoinDesk.

The CFTC said it would sign on to the guidance and administer it under the Commodities Exchange Act.

“Market participants — from innovators and issuers to individual investors — should review this interpretation to better understand the regulatory jurisdiction between the SEC and CFTC,” the CFTC said in a press release. “The interpretation will be published on CFTC.gov and in the Federal Register.”

Congressman Troy Downing (R-Mont.) called the guidance “very positive,” but said Congress still needed to pass market structure legislation as a future administration could undo the interpretative guidance.

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“Just having another two or three years of this and then having ambiguity out there doesn’t make most people comfortable on doing any kind of big investment,” he told CoinDesk. “But it’s a great start because this is exactly what the industry wants, and it allows some people to move forward.”

Chris LaVigne, a partner at the law firm Withers, said the guidance “predictably concludes that most crypto assets and many common crypto activities are not securities,” though the agency kept some discretion to being an enforcement action in this area.

“The guidance moves the securities inquiry away from the asset or activity itself (which are mostly deemed digital commodities not within the purview of the SEC) and re-centers the analysis on the transactions and representations in which these assets or activities arise or are marketed,” he said. “By doing so, the SEC did not completely eliminate uncertainty or its enforcement role, because it concludes that a crypto asset that is not a security can nonetheless be sold as part of an investment contract if it is marketed with promises of profit derived from the issuer’s essential managerial efforts.”

A crypto that was marketed as a security may eventually be deemed something else “once those promises are fulfilled or no longer operative,” he said. This might affect securities more broadly than just crypto assets.

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It’s less clear what may constitute a commodity under the guidance.

Jason Gottlieb, a partner at Morrison Cohen, said the Commodity Exchange Act defines commodities as a list of products (excluding onions and motion picture box office receipts), services and other issues “in which contracts for future delivery are presently or in the future dealt in.”

This legal definition diverges from the definition seemingly being used in the guidance. The CFTC’s approach to crypto over the past decade has evolved since some early lawsuits, where it claimed jurisdiction over bitcoin , leading it to seemingly have jurisdiction over non-security cryptocurrencies. But this definition needs to be codified by market structure legislation, he told CoinDesk.

“People need to understand that jurisdiction is still uncertain. The SEC is clearly saying ‘we don’t have jurisdiction if the token does not meet these criteria,’” he said. “Just because the SEC does not have jurisdiction does not mean the CFTC does.”

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Gottlieb said he was part of a case before the Seventh Circuit Court of Appeals seeking to gain clarity on this question, but market structure legislation would be needed to cleanly grant the CFTC jurisdiction over all non-security cryptocurrencies.

The status of that legislation also remains up in the air. Senator Cynthia Lummis (R-Wyo.), speaking at the DC Blockchain summit earlier this week, said she anticipated a markup may happen in the final weeks of April. The issue of stablecoin yield may be resolved with an agreement that stablecoin issuers and their partner firms would not describe their products using bank terminology, though she cautioned that she hadn’t seen any specific language yet.

The flip side, several individuals told me, is that the Clarity Act might require the SEC to go back to the drawing board on how it’s defining securities in crypto. But this falls under the category of bridges that can be crossed when they’re reached.

Senator Tim Scott (R-S.C.), the chair of the Senate Banking Committee, said lawmakers are also close to agreements on issues like ethics and quorums on the regulatory agencies — some of the outstanding areas of disagreement on the bill.

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Downing said he saw an April time frame as doable for advancing market structure legislation. The closer lawmakers get to the end of the year, however, the less likely it would be that anything could be passed, he said, pointing to the midterm election. “But I don’t think it’s impossible.”

Senator Kirsten Gillibrand (D-N.Y.) said on stage at the DC summit that she was “optimistic” there would be a markup soon, which would then lead to the Banking and Agriculture Committee’s bills combining.

The combined bill would need to incorporate areas of bipartisan agreement, she said.

“One of the issues that I think is very important that people should be aware of is the Senate wants an ethics provision,” she said. “I think the House would have had even more support on the Democratic side if they had retained their ethics provisions in their bill. It’s very important that members of Congress do not get rich off of this industry, because they have access to non-public information, because they have positions of power and authority.”

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Downing said the market structure bill needed to address consumer protections and money laundering, without being so restrictive that companies would be scared to do anything.

“Nobody wants bad actors in their space and nobody wants that reputation of bad actors using this as a tool to do bad things,” he said. “… If you bring those [provisions] in too narrow, nobody’s going to do anything innovative.”

He said he understood why banks might be concerned about the yield issues.

“Community lenders, community banks are worried about depositors all exiting the market, in which case you’re not doing mortgages on small farms in Montana, right?” he said.

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Late Friday, Senators Angela Alsobrooks and Thom Tillis told Politico they had reached an agreement on the yield issue, though the details had not been shared with the banking or crypto industries as of press time.

Kalshi was just ordered to cease offering most of its prediction markets in the state of Nevada for at least two weeks, pending a hearing on April 3.

The order came after an appeals court refused to grant an administrative motion that could have blocked the state court’s action. Earlier in the week, the state of Arizona filed criminal charges against Kalshi, alleging some of its election and other contracts violate state law.

In Nevada, a judge ruled that Kalshi can’t offer sports, election or entertainment-related event contracts at least temporarily.

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According to the order by Judge Jason Woodbury, the record in Nevada’s case against Kalshi so far suggests that it offers products defined by state law, making its conduct subject to Nevada’s gaming regulators.

“The question of federal preemption in this regard is nuanced and rapidly evolving,” the judge wrote. “At the moment, the balance of convincing legal authority weighs against federal preemption in this context.”

The Arizona action goes further, alleging misdemeanor violations on small bets placed on professional football and college basketball games, upcoming elections and on whether bills become law and whether public figures will show up to sporting events.

“Arizona law prohibits operating an unlicensed wagering business, and separately bans betting on elections outright,” Arizona Attorney General Kris Mayes’ office said in a press release.

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Kalshi co-founder Tarek Mansour called the charges a “total overstep” that “have nothing to do with gambling or the merits.”

There’s a broader growing backlash to prediction markets. Senator Catherine Cortez-Masto, who represents Nevada, wrote an opinion piece saying prediction markets “blatantly violate state and tribal laws and regulations.”

“To ensure responsible gaming, casinos, sportsbooks and online gaming sites have to follow minimum age requirements, participate in integrity monitoring and support critical consumer protections, like programs that help people with gambling addictions,” she said. “Yet, this past year, emboldened by limp and overly permissive federal regulators like the Commodity Futures Trading Commission (CFTC), so-called ‘prediction markets’ have transformed themselves into illegal sportsbooks, offering their users illicit sports wagers.”

This week

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  • There are no hearings or public meetings scheduled (at least pertaining to crypto).

If you’ve got thoughts or questions on what I should discuss next week or any other feedback you’d like to share, feel free to email me at [email protected] or find me on Bluesky @nikhileshde.bsky.social.

You can also join the group conversation on Telegram.

See ya’ll next week!

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Blackstone’s BCRED Posts First Monthly Loss in Over Three Years as Investor Withdrawals Hit $3.7B

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Brian Armstrong's Bold Prediction: AI Agents Will Soon Dominate Global Financial

TLDR:

  • BCRED reported a 0.4% loss in February 2025, its first monthly decline since September 2022’s 1.3% drop.
  • Investors withdrew $3.7 billion from BCRED in Q1 2025, surpassing the fund’s typical quarterly redemption volume.
  • Blackstone wrote down loans for select borrowers, including software firm Medallia, per a letter to financial advisers.
  • Blackstone shares have dropped over 28% this year as banks tighten lending and rivals cap investor withdrawals.

Blackstone’s private credit fund, BCRED, recorded its first monthly loss in over three years in February 2025. The $82 billion fund reported a total loss of 0.4%, drawing attention to growing pressures across the private credit sector.

Investor concerns around liquidity, credit quality, and withdrawal surges have grown steadily this year. This development marks a turning point for one of the largest private credit vehicles in the world.

BCRED Reports February Loss as Withdrawals Surge

BCRED’s last recorded monthly loss before February was in September 2022, when it posted a decline of 1.3%. The February 2025 loss of 0.4% comes as investor sentiment around private credit has noticeably shifted.

For context, the Morningstar LSTA index of publicly traded leveraged loans fell 0.8% in February, per Morningstar’s website.

During the first quarter of this year, Blackstone’s fund faced a larger-than-usual wave of redemption requests. Investors pulled $3.7 billion from BCRED, a figure that exceeded typical quarterly withdrawal volumes.

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The fund allows investors to withdraw a portion of their holdings every quarter, which adds a layer of liquidity pressure.

Financial news reporter Kristen Shaughnessy shared the development on social media, drawing wider public attention. The post referenced a Financial Times report citing a letter sent to financial advisers by Blackstone. According to that report, customer service software firm Medallia was among the companies whose loans were written down.

BCRED wrote down the value of a “select” number of loans during February, per the Financial Times report. Despite this, Blackstone maintained that the fund has delivered a 9.5% annualized total return since inception for Class I shares. The firm also noted that BCRED has outperformed the leveraged loan market by 100 basis points so far this year.

Private Credit Sector Faces Growing Scrutiny From Banks and Investors

Private credit funds have come under growing scrutiny due to weakening credit quality across the sector. Their high exposure to vulnerable sectors such as software has raised concerns among analysts and investors. Additionally, a lack of transparency has made it harder for market participants to assess underlying risks.

These concerns have spilled over onto Wall Street, where some major U.S. banks have tightened lending to the private credit industry.

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JPMorgan Chase marked down the value of certain loans to private credit players earlier this month. That move is expected to reduce available lending to funds operating in the space.

Morgan Stanley and BlackRock were among the firms that moved to limit withdrawals from their own funds. Both firms acted following a surge in redemption requests from investors. This pattern across multiple funds points to a broader trend of tightening liquidity across private credit markets.

Shares of Blackstone, the world’s largest alternative asset manager, have lost more than 28% of their value so far this year.

That decline mirrors the broader unease investors have expressed toward the alternative asset space. As the sector navigates these pressures, fund managers are being watched more closely than at any point in recent years.

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XRP Open Interest Drops Across Exchanges While 2026 Regulatory Catalysts Build

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Brian Armstrong's Bold Prediction: AI Agents Will Soon Dominate Global Financial

TLDR:

  • XRP open interest is falling across major exchanges, with Binance still holding the largest derivatives market share.
  • Liquidation spikes and soft taker volume confirm that leveraged XRP positions are actively being unwound market-wide.
  • XRP has gained dual commodity classification from the SEC and CFTC, marking a turning point in regulatory clarity.
  • ETF inflows of $1.44B and Ripple’s $2.7B in acquisitions reflect rising institutional confidence heading into 2026.

XRP open interest continues to contract across major derivatives exchanges, reflecting an ongoing deleveraging trend in the market.

Despite this broad decline, Binance maintains the largest share of XRP open interest among top platforms. At the same time, a growing set of regulatory and institutional developments is taking shape in 2026.

Analysts are watching closely to see whether these catalysts can reverse the current market structure.

Binance Dominates as Leveraged Positioning Unwinds

Binance remains the primary venue for XRP leveraged trading, holding the most open interest across major exchanges.

However, the exchange’s own 24-hour data shows continued weakness in positioning, with no strong recovery in sight.

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Net taker volume on Binance also remains soft, which points to limited aggressive demand from new buyers. This combination suggests the market is still in a reset phase rather than entering a fresh expansion.

Liquidation data adds further weight to this view. Recent liquidation spikes show that forced leverage cleanup has played a role in driving open interest lower.

Rather than reflecting fresh long conviction, the current structure points to position unwinding. Speculative appetite across XRP derivatives continues to fade as a result.

The overall trend across exchanges mirrors what Binance is showing internally. Open interest is falling in a broad and sustained manner, not in isolated bursts.

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This pattern typically follows periods of elevated speculation and leverage buildup. For open interest to recover, the market would need stronger directional participation from both retail and institutional traders.

Until that recovery arrives, the market structure for XRP derivatives remains under pressure. Binance will likely continue to lead the space by volume and open interest.

However, the gap between Binance and other exchanges may shift if conditions improve on other platforms. Traders are watching these metrics carefully as a leading signal for XRP’s next move.

Regulatory and Institutional Catalysts Are Aligning in 2026

On the fundamental side, a series of developments are converging that some analysts say could drive a major move.

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XRP has been officially classified as a digital commodity by both the SEC and the CFTC, bringing long-awaited regulatory clarity.

The CLARITY Act markup is targeting April, and Ripple CEO Brad Garlinghouse has placed the odds of passage at 80 to 90 percent. Additionally, a stablecoin yield compromise is reportedly near completion.

Institutional interest is also building at a fast pace. XRP-related ETFs have pulled in $1.44 billion in inflows, while Evernorth has filed its S-4 for a Nasdaq listing.

Ripple has also made over $2.7 billion in acquisitions and is expanding its global footprint. A Ripple National Trust Bank application is currently under review as well.

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Crypto analyst X Finance Bull noted on X that in 2024, XRP ran from $0.49 to $3.60 on news alone. The analyst argued that the 2026 setup carries heavier weight, with regulation, infrastructure, and institutional capital aligning together. That framing has drawn attention from traders reassessing their positions.

Whether the derivatives market responds to these catalysts remains to be seen. Open interest recovery alongside stronger volume would signal a shift in market sentiment. For now, XRP sits at a crossroads between fading speculative leverage and growing structural support.

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Fidelity Requests More Clarity From SEC on Tokenized Assets and DeFi

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Decentralization, SEC, United States, DeFi, RWA, RWA Tokenization

Fidelity Investments told the US Securities and Exchange Commission (SEC) on Friday that it should continue to develop the regulatory framework for broker-dealers to offer, custody and trade crypto assets on alternative trading systems (ATS).

The letter from the US’ third-largest asset manager was in reply to a call for comments earlier this month by the regulator’s Crypto Task Force.

Fidelity said it is “critical” for the SEC to develop a comprehensive regulatory framework and clear rules of the road for tokenized securities trading, including rules for trading tokenized securities issued by third parties. 

Decentralization, SEC, United States, DeFi, RWA, RWA Tokenization
Fidelity Investments’ letter to the SEC requesting more information on alternative trading system rules. Source: Fidelity Investments

Tokenized instruments have different issuance structures, legalities, and valuation models, the letter said. For example, tokenized real-world assets (RWAs) span entirely different asset classes like equities, real estate, bonds, or private credit. 

“Tokenization models vary significantly in structure and in the rights afforded to holders,” the letter said. The company explained:

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“In some models, the crypto asset represents a holder’s indirect interest in the underlying security through a securities entitlement, while in others, the crypto asset may constitute a securities‑based swap, which may be offered only to eligible contract participants.” 

Fidelity also urged the SEC to bridge the regulatory gap between centralized and decentralized trading systems to “consider how intermediated and disintermediated trading venues can evolve and coexist,” the company’s general counsel, Roberto Braceras, wrote.

Decentralization, SEC, United States, DeFi, RWA, RWA Tokenization
Differences between centralized and decentralized crypto exchanges. Source: Cointelegraph

This includes overhauling existing reporting rules to reflect that decentralized finance (DeFi) trading platforms and other “disintermediated” systems cannot produce the detailed financial reporting required by the SEC because there is no central authority.

Additionally, Fidelity recommended that the SEC issue guidance permitting broker‑dealers to use distributed ledger technology for ATS and other recordkeeping purposes.

Overhauling reporting requirements to reflect this technological reality removes “undue burden” from decentralized systems, the letter said.

The Securities and Exchange Commission, under the leadership of Chairman Paul Atkins, has repeatedly signaled support for 24/7 capital markets and has given the regulatory approval for financial companies to experiment with tokenized trading.

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Related: SEC interpretation on crypto laws ‘a beginning, not an end,’ says Atkins

US regulators say tokenized securities are subject to the same capital rules as underlying assets

Tokenized securities, which include equities, debt instruments, real estate investment trusts (REITs) and other securitized assets, are subject to the same banking capital requirements as the underlying assets they hold.

This view was shared in a joint policy statement published in March from the Federal Reserve, the Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency (OCC). 

“The technologies used to issue and transact in a security do not generally impact its capital treatment,” according to the agencies.

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Magazine: When privacy and AML laws conflict: Crypto projects’ impossible choice