UniCredit director Elena Carletti has warned Europe may struggle to contain a crypto bank crisis under MiCA rules.

UniCredit deputy vice chair Elena Carletti has warned that Europe may struggle to contain a crypto-linked banking shock under MiCA. The Italian bank executive said EU tools are weaker than the US emergency response of 2023.

The comments land as MiCA pulls stablecoin issuers closer to traditional lenders. Carletti, who chairs UniCredit’s board risk committee, said at an IESE Business School conference in Madrid that the same systemic-risk exception used to guarantee all SVB and Signature deposits “cannot be easily taken in Europe.”

Why MiCA creates a “double weakness”

MiCA requires stablecoin issuers, classified as electronic money tokens, to hold reserves in liquid assets including bank deposits and government securities. That ties stablecoin stability directly to bank balance sheets.

The link became visible during the March 2023 SVB collapse. Circle, issuer of USDC, disclosed $3.3 billion of reserves stuck at the failed bank, and the stablecoin briefly lost its dollar peg before US regulators guaranteed all deposits.

“The coverage and protection … was given to all deposits, including stablecoin companies, and that also allowed to maintain the stability of the stablecoin,” Carletti said. EU deposit insurance, capped at €100,000, cannot absorb stress from large stablecoin reserve accounts the same way.

What it means for Europe’s stablecoin push

Carletti’s warning comes as European banks lean further into stablecoins. UniCredit itself is a founding member of Qivalis, the consortium planning a MiCA-compliant euro stablecoin for launch in the second half of 2026.

Italy’s Banca Sella, another Qivalis founder, recently won Bank of Italy approval to offer crypto custody and transfer services under MiCA’s notification route for credit institutions. The full MiCA rollout tightens supervision of CASPs, stablecoin issuers and DeFi front-ends by July 2026.

Tether CEO Paolo Ardoino has previously argued MiCA’s 60% uninsured cash reserve requirement could itself trigger systemic risk, echoing Carletti’s concern from the issuer side.

Latest developments: Calamos says its protected Bitcoin ETFs are attracting inflows even as spot Bitcoin ETFs see redemptions.

• Matt Kaufman, head of ETFs at Calamos, said the firm saw roughly $10 million to $15 million in inflows over the past several weeks.
• Kaufman said advisors are increasingly looking for Bitcoin exposure that reduces volatility and downside risk.
• The firm offers three versions of its protected Bitcoin ETFs, including products with full downside protection and others with 10% or 20% downside risk.
• “You can get upside of Bitcoin with no downside risk,” Kaufman said.
• Kaufman joined CoinDesk’s Jennifer Sanasie on Public Keys.

How it works: Calamos structures the products using Treasuries and options tied to Bitcoin-linked indexes.

• Kaufman said the firm allocates roughly 90% of assets into Treasuries to build downside protection.
• The remaining budget is used to buy Bitcoin-linked call spreads through FLEX options.
• Calamos created its own Bitcoin-linked index and listed FLEX options tied to that index after the launch of spot Bitcoin ETF options.
• The products are offered in quarterly structures as well as laddered versions designed for model portfolios.

What advisors are asking: Wealth managers are becoming more sophisticated in how they evaluate crypto exposure.

• Kaufman said advisors previously focused on whether Bitcoin belonged in portfolios at all.
• Now, advisors are asking how to improve risk-adjusted returns and portfolio construction using crypto exposure.
• Calamos positions its products as alternatives to traditional portfolio allocations, including broad equities, bonds and cash.
• Kaufman said some investors are moving from cash-like products into fully protected Bitcoin ETFs tied to Bitcoin performance but without downside exposure.

Reading between the lines: The crypto ETF market is evolving beyond simple spot exposure.

• Kaufman said the industry is increasingly dividing crypto ETF strategies into three categories: protection, income and growth.
• Calamos previously launched auto-callable income ETFs and is exploring additional crypto-related strategies.
• Other ETF issuers have focused on generating yield from Bitcoin volatility through options-based products.
• “You don’t just have to sit in the spot vehicle anymore and ride out those waves,” Kaufman said.

What comes next: Calamos expects Bitcoin volatility to remain a defining feature of the asset.

• Kaufman said he expects Bitcoin to revisit previous highs despite recent market turbulence.
• He argued Bitcoin’s volatility profile creates opportunities for structured products and options-based strategies.
• “I think we’re going higher,” Kaufman said.

Key Insights

• BTC trades below its important $80,000-$84,000 resistance level following multiple failed attempts at breaking out above it
• The U.S. inflation numbers and Fed monetary expectations continue to dominate Bitcoin sentiment in the short term
• Spot BTC ETF flow coming from institutional participants continues to be a big contributor to BTC’s liquidity
• Options expiration on significant BTC amounts increases the probability of volatility and sharp price moves
• Technical indicators show that Bitcoin still continues its consolidation phase within the broader corrective market structure

Increasing Volatility Around Major Resistance Level for Bitcoin

BTC was trading around the $76,700 level. As market participants paid close attention to inflation data, ETF action, and macroeconomic updates, Bitcoin’s volatility surged significantly. Investors’ sentiment has remained conservative due to ongoing struggles by Bitcoin below the resistance zone at $80,000-$84,000.

Currently, the crypto market has become highly sensitive to events happening in the traditional finance world. Bitcoin is regarded as a risk-on currency that has been actively responding to fluctuations in liquidity, yields, and Fed guidance.

Recent market dynamics have been characterized by intense battles between bulls and bears around technical levels. Despite multiple attempts to break higher by Bitcoin in May, sellers have managed to protect higher levels.

Macroeconomic News Pushes Bitcoin Speculators to Be Defensive

Macroeconomic news still represents the most significant driver behind Bitcoin’s short-term performance. Speculators are currently very attentive to the upcoming Consumer Price Index (CPI) inflation report in the United States, which might be the most important financial market event scheduled in the next couple of weeks.

Lower-than-expected inflation numbers would boost risk appetite and stimulate stronger institutional appetite for Bitcoin and other cryptocurrencies. By contrast, higher-than-expected inflation would put negative pressure on BTC due to higher Treasury rates and a stronger US dollar.

Also, the Fed’s stance is another driver affecting the overall market sentiment. Market players are very reactive to any possible hints about potential changes to interest-rate cuts or liquidity injections. As shown previously, a dovish monetary policy stance has often fueled strong Bitcoin gains because of enhanced market liquidity and increased speculative appetite.

On the other hand, existing geopolitical tensions are another source of volatility for financial assets. Higher oil prices or conflicts between countries would make investors move into defensive positions, negatively impacting Bitcoin.

Bitcoin ETF Inflows Keep Liquidity in Bitcoin Stable

The spot Bitcoin ETF has been a prominent factor behind market momentum. Institutional investments in Bitcoin ETFs help recover markets from declines through their support.

Market players are still observing developments in ETFs from some of the top asset managers such as BlackRock and Fidelity Investments. Positive ETF inflows usually result in momentum-based rallies and short squeezes when market sentiment is positive.

Nonetheless, investors remain cautious about the risk of bearish pressure. Downside pressure on Bitcoin may increase rapidly when ETF flows are reduced while leveraged positions remain high.

Bitcoin Options Expiry Could Set Off Market Surges

Bitcoin options expiry represents another significant element responsible for market volatility. Monthly options expiry events lead to occasional price dislocations and swift movements due to the adjustment of hedging strategies and the closing of leveraged positions.

Future expiration periods are predicted to result in higher market volatility levels, especially when Bitcoin is trading around key technical resistances. Constricted trading activity and narrowed ranges tend to precede bigger directional moves.

Institutional investors are already gearing up for possible market breakouts depending on the economic environment and liquidity situations.

Chart Technicals Hint at Further Consolidation

The technical structure seen on Bitcoin’s daily chart implies that the cryptocurrency is operating within a larger consolidation process following previous corrections from its record high above $124,000. In both those occasions, periods of increased selling pressure had led to the formation of strong support levels around $60,000 prior to the beginning of recovery processes.

In the current case, although Bitcoin has been forming new lower lows, the momentum surrounding these moves has been decreasing. This can be seen from the fact that the Relative Strength Index (RSI) indicator is now approaching neutral readings, after having risen into overbought territory during the first stages of the bounce process.

U.S. Securities and Exchange Commission Commissioner Hester Peirce warned this week that financial privacy is increasingly undervalued in U.S. regulation, urging a more balanced view of privacy-preserving technology as part of the nation’s financial infrastructure.

Speaking on Wednesday at Georgetown Law, Peirce framed cryptographic tools and privacy-enhancing technologies as legitimate components of modern markets, not merely the province of illicit actors.

“Empowering government to identify, pursue, and punish the bad guys is important to the security of the nation and its people, but so too is empowering people to protect information about their lives, including their financial lives,” she said, according to the transcript published on the SEC’s website.

Peirce added that privacy technologies can help individuals protect themselves from hackers, scammers and other malicious actors, and should not be viewed as “an opportunity for the government to watch more of what its citizens do.”

She encouraged developers building privacy-enhancing technologies to engage with the SEC’s Crypto Task Force, particularly on tools that could support Know Your Customer (KYC) and Anti-Money Laundering (AML) compliance requirements.

Key takeaways

• Privacy-enhancing technologies are legitimate components of financial infrastructure, not solely tools for illicit activity.
• Financial privacy can coexist with national security objectives and may reduce information exposure for individuals.
• Developers of privacy-focused tools should collaborate with the SEC’s Crypto Task Force on potential KYC/AML compliance considerations.
• Regulatory conversations in the European Union point to 2027 AML rule changes that could restrict anonymous accounts and privacy-preserving tokens.
• Privacy-focused crypto innovation remains active in the market, with practical applications and ongoing investor interest in assets and use cases that prioritize on-chain privacy.

Privacy returns to crypto spotlight

Privacy and privacy-preserving technologies have long been a core use case for crypto, with projects like Monero and Zcash designed to shield transaction data and user identities. The current regulatory dialogue has revived debate over the role these tools should play in the ecosystem. Advocates argue that privacy protections help users defend against surveillance, data exploitation, and targeted scams, while critics warn they could enable illicit finance if not properly regulated.

The regulatory conversation has also spilled into Europe, where authorities are weighing new AML rules slated to take effect in 2027. The framework would constrain anonymous accounts and access to privacy-preserving cryptocurrencies by banks and crypto service providers, underscoring the tension between privacy and oversight across borders.

Legal experts tracking the space have described maintaining access to privacy-focused digital assets as a “constant battle” between industry participants and regulators. Anja Blaj, a legal consultant at the European Crypto Initiative, has highlighted how regulatory friction can shape the pace and direction of privacy innovations in the sector.

As the privacy discourse persists, market observers have noted measurable interest in privacy-focused assets. Zcash, in particular, has seen renewed attention and price momentum over the past year, a signal of investors valuing privacy-centric capabilities amid shifting regulatory expectations. (Source: CoinMarketCap)

From policy to on-chain practice

Policy debates aside, the industry continues to translate privacy concepts into on-chain tools and products. Aptos has introduced a privacy-focused coin intended to prevent wallet profiling and protect treasury movements from competitor insight, illustrating how privacy tech can be embedded into corporate and network-level transactions.

Meanwhile, Polygon has rolled out private stablecoin payments for institutions, positioning privacy as a facilitator of broader on-chain adoption by enabling discreet settlement and treasury operations. These developments reflect a broader push to reconcile privacy with practical business and regulatory requirements in real-world deployments.

Looking ahead, investors and builders should watch how privacy-centric tools align with evolving KYC/AML frameworks and the regulatory guidance that will emerge from the SEC Crypto Task Force and European authorities. The path forward will likely combine tighter oversight with clearer, standards-based privacy implementations that support legitimate use while limiting misuse.

U.S. Securities and Exchange Commission (SEC) Commissioner Hester Peirce has flagged a growing undervaluation of financial privacy within U.S. regulation, urging policymakers to move away from treating privacy-preserving technologies with suspicion. Speaking at Georgetown Law, Peirce framed privacy-enhancing technologies as legitimate components of the modern financial ecosystem, not solely as tools associated with illicit activity.

According to a transcript published on the SEC’s website, Peirce argued that safeguarding financial privacy does not stand in opposition to national security objectives. “Empowering government to identify, pursue, and punish the bad guys is important to the security of the nation and its people, but so too is empowering people to protect information about their lives, including their financial lives,” she said.

Peirce emphasized that privacy technologies can help individuals shield themselves from hackers, scammers, and other malicious actors, and should not be construed as an opening for broader surveillance. She also urged developers building privacy-enhancing technologies to engage with the SEC’s Crypto Task Force, particularly on tools that could support Know Your Customer (KYC) and Anti-Money Laundering (AML) compliance requirements.

Key takeaways

• Privacy-preserving technologies are legitimate components of financial infrastructure and are not inherently tied to illicit activity.
• Protecting financial privacy does not conflict with national security objectives; both privacy protections and enforcement capabilities are necessary.
• Regulators are seeking constructive engagement with developers to align privacy innovations with KYC/AML obligations through the SEC Crypto Task Force.
• Global regulatory dynamics are evolving: the European Union is advancing MiCA and 2027 AML rules that could curb anonymous accounts and privacy-preserving cryptocurrencies.
• Industry activity in on-chain privacy tools—ranging from privacy-focused assets to private payment primitives for institutions—continues to shape compliance, licensing, and risk management considerations for firms operating in crypto markets.

Privacy in the regulatory mainstream and cross-border considerations

Peirce’s remarks situate privacy-enhancing technologies at the center of financial infrastructure discussions rather than at the periphery of enforcement. By highlighting that privacy and security can be complementary rather than mutually exclusive, she signals a regulatory posture that seeks to balance technology innovation with risk controls. The SEC’s framing appears to encourage a collaborative approach: privacy tools should not be viewed as antagonistic to regulatory objectives but as potential enablers of safer, more resilient markets when designed with compliance in mind.

Regulatory momentum and the EU policy landscape

The conversation about privacy in crypto is not limited to the United States. In the European Union, policymakers are integrating privacy considerations into a broader regulatory framework that aims to harmonize market integrity with consumer protections. MiCA (Markets in Crypto-Assets Regulation) and related AML policy developments are central to how privacy-preserving assets and tools will be treated across EU member states. Proposals under consideration could restrict anonymous accounts and limit support for privacy-focused cryptocurrencies, underscoring the cross-border regulatory risk for projects and institutions that rely on shielded transaction data or user anonymity features.

Legal experts warn that maintaining access to privacy-oriented digital assets remains a contentious and ongoing negotiation. Anja Blaj, a legal consultant at the European Crypto Initiative, described the ongoing struggle as a “constant battle” between the crypto industry and regulators over privacy policy and enforcement. This tension underscores the diverging regulatory trajectories that global firms must navigate when operating in multiple jurisdictions.

Industry developments and practical implications for compliance

Beyond policy debates, the market has seen tangible product developments aimed at enabling privacy without sacrificing onramp and oversight capabilities. For example, privacy-focused blockchain experiments and assets have attracted attention as firms seek to shield treasury movements, payment flows, or strategic trading data from competitors while preserving necessary auditability. In parallel, platforms have introduced privacy-enhanced features for institutional use, such as private payments or shielded transaction layers, designed to support regulated, compliant on-chain activity.

These developments illustrate a broader trend: institutions are pursuing privacy-aware architectures to reduce exposure to data leakage and profiling while remaining subject to KYC/AML, sanction screening, and licensing requirements. The implications for exchanges, custodians, banks, and other financial services providers include heightened emphasis on governance, data minimization, cryptographic risk assessments, and robust regulatory reporting capabilities. In this context, privacy technologies must be evaluated through the lens of risk management, policy alignment, and enforcement readiness.

Engagement, compliance, and the path forward

Peirce’s call for dialogue with the SEC Crypto Task Force points to a practical path for integrating privacy innovation with established compliance regimes. The task force serves as a channel for assessing how privacy-preserving tools can support or constrain KYC/AML objectives, licensing standards, and supervisory expectations. For crypto firms and financial institutions, this signals a need to document privacy-by-design approaches, establish auditable controls for data minimization and access, and maintain transparent governance around cryptographic privacy features.

Looking ahead, the regulatory landscape will continue to shape both product innovation and risk management. While privacy technologies can enhance user protections and resilience against crime, they also invite careful scrutiny to ensure that anonymity does not undermine anti-fraud measures or cross-border enforcement. For policymakers, the challenge lies in harmonizing privacy protections with the realities of global finance, while for market participants, the focus remains on building compliant, auditable privacy-enabled solutions that align with evolving licensing and oversight frameworks.

What comes next will hinge on ongoing rulemaking, enforcement actions, and collaborative efforts between regulators and industry players. Observers should monitor developments in MiCA and EU AML policy, the SEC’s ongoing Crypto Task Force initiatives, and cross-border regulatory formations that could influence the design and deployment of privacy-enhancing technologies in crypto markets.

A New York Bitcoin ownership lawsuit has triggered sharp legal criticism after plaintiffs sought control of 39,069 dormant wallets. The wallets reportedly hold about 3.7 million BTC, valued at nearly $286 billion. Ripple CTO Emeritus David Schwartz challenged the case and questioned its legal foundation.

Bitcoin Lawsuit Targets Dormant Wallets And Satoshi-Linked BTC

The lawsuit was filed by Noah Doe and two Wyoming-based companies, ABC Company and XYZ Company. They asked a New York court to award them control of inactive Bitcoin wallets. The filing claims the wallets qualify as abandoned property under New York law.

The plaintiffs argue they found a flaw that prevents the owners from using the wallets. They also reported the dormant addresses to the New York Police Department. Therefore, they say the wallets should receive treatment similar to lost property or unclaimed bank accounts.

The case filing includes addresses linked to Bitcoin creator Satoshi Nakamoto. It also names the 1Feex wallet connected to the Mt. Gox hack. That detail increased attention because the wallets hold major historical importance in the Bitcoin market.

Ripple’s David Schwartz Challenges Bitcoin Case Reasoning

David Schwartz criticized the lawsuit’s claim that New York has jurisdiction over the wallets. He said the argument relies on the idea that the property was found in New York. However, he described that reasoning as deeply flawed and legally weak.

Schwartz argued that Bitcoin wallets do not sit inside New York simply because someone reported them there. He said the case faces several major legal barriers. Moreover, he warned that a weak ruling could still create practical problems.

The Ripple executive said a favorable ruling for plaintiffs could affect future wallet movements. For example, funds moved to a United States exchange could face freeze requests. Plaintiffs could then claim those coins belong to them under the New York ruling.

BTC Ownership Debate Raises Wider Crypto Concerns

The lawsuit comes as old Bitcoin wallets continue to attract legal and technical debate. Many early wallets have stayed inactive for more than a decade. However, inactivity does not prove abandonment under standard ownership principles.

The filing also touches on one of Bitcoin’s most sensitive topics. Satoshi-linked BTC remains central to market history and public debate. Any legal attempt to control those coins would likely face strong challenges from the wider crypto community.

Schwartz warned that even a flawed ruling could cause damage without a timely challenge. He said courts sometimes treat old judgments differently after enough time passes. As a result, he urged serious attention before the case creates further legal risk.

Background Shows Growing Pressure Around Old Bitcoin Wallets

The case follows other debates about dormant Bitcoin holdings and possible protocol changes. Earlier, LayerTwo Labs CEO Paul Sztorc proposed a hard fork that drew attention to Satoshi’s BTC. The idea raised concerns before Sztorc later dismissed the seizure angle.

Old wallets remain difficult legal targets because blockchain ownership depends on private keys. Courts can issue orders, but networks do not transfer coins without valid signatures. Therefore, enforcement would likely depend on exchanges, custodians, and regulated platforms.

The New York case now places dormant Bitcoin ownership under a fresh spotlight. It also shows how legal claims can collide with blockchain design. For now, Schwartz’s criticism frames the lawsuit as a weak but potentially disruptive challenge.

US Securities and Exchange Commission (SEC) Commissioner Hester Peirce said financial privacy is becoming increasingly undervalued in US regulation, warning against treating privacy-preserving technologies with suspicion.

Speaking Wednesday at Georgetown Law, Peirce described privacy-enhancing technologies, including cryptographic tools, as legitimate components of modern financial infrastructure rather than tools primarily associated with criminal activity.

Peirce said that protecting financial privacy does not conflict with national security objectives.

“Empowering government to be able to identify, pursue, and punish the bad guys is important to the security of the nation and its people, but so too is empowering people to protect information about their lives, including their financial lives,” she said, according to a transcript published on the SEC’s website.

She added that privacy technologies can help individuals protect themselves from hackers, scammers and other malicious actors, and should not be viewed as “an opportunity for the government to watch more of what its citizens do.”

Peirce also encouraged developers building privacy-enhancing technologies to engage with the SEC’s Crypto Task Force, particularly on tools that could support Know Your Customer (KYC) and Anti-Money Laundering (AML) compliance requirements.

Source: zooko

Related: Tor Project to lead Web3 crowdfunding to support internet freedom

Privacy returns to crypto spotlight

Privacy and privacy-preserving technologies have long been one of cryptocurrency’s core use cases, with projects like Monero and Zcash built around shielding transaction data and user identities.

The debate returned to the spotlight over the past year as regulators and developers clashed over the role of privacy tools in crypto. While advocates argue these technologies protect users from surveillance, hackers and data exploitation, critics have raised concerns about their potential use in illicit finance.

The debate has also been taken up in the European Union, where regulators and blockchain industry participants are weighing new AML rules scheduled to take effect in 2027. Under the framework, credit institutions and crypto asset service providers would be prohibited from maintaining anonymous accounts or supporting privacy-preserving cryptocurrencies.

Maintaining access to privacy-focused digital assets has been a “constant battle” between the crypto industry and regulators, according to Anja Blaj, a legal consultant at the European Crypto Initiative.

Growing interest in privacy-focused cryptocurrencies has helped drive Zcash prices sharply higher over the past year. Source: CoinMarketCap

At the same time, companies continue developing privacy-focused blockchain applications. Aptos unveiled a privacy-focused coin designed to help businesses transact onchain without exposing treasury movements, payment flows or trading strategies to competitors.

Polygon has also rolled out private stablecoin payments for institutions, positioning the feature as a way to support broader adoption of onchain transactions.

Related: Bitcoin developer launches privacy-focused Nostr VPN using public keys