Democratic Senators Elizabeth Warren and Andy Kim challenged Treasury Secretary Scott Bessent to investigate a $500 million foreign entry into President Donald Trump’s family cryptocurrency business, World Liberty Financial.

In a letter dispatched to the Treasury, the lawmakers flagged a purchase that transferred a 49% equity stake in the project to a United Arab Emirates-backed vehicle just 96 hours before Trump took the oath of office.

US Lawmakers Demand Treasury Probe into WLFI

Warren and Kim demanded that the Committee on Foreign Investment in the United States (CFIUS) determine whether this capital injection into WLFI threatens national security.

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“Given the speed at which the deal reportedly closed—which ‘granted swift paydays to entities affiliated with the Trumps’—it is
important to know whether Trump officials gave UAE-backed investors special treatment,” the lawmakers wrote.

The senators focused their inquiry on the specific origins of the funds. Sheikh Tahnoon bin Zayed Al Nahyan, the UAE’s national security adviser, reportedly steered the investment.

This transaction placed two executives from his artificial intelligence firm, G42, directly onto the World Liberty Financial five-member board.

The senators argue that this arrangement grants a foreign entity operational control over a company explicitly tied to the sitting president.

Warren and Kim highlighted the geopolitical risks associated with G42. They noted that US intelligence officials previously scrutinized the firm for allegedly supplying surveillance technology to the Chinese military.

“U.S.intelligence has long warned that G42 may have provided technology to assist China’s military, and G42’s current CEO reportedly worked with Chinese engineers to develop a messaging app disguised as a surveillance tool,” the lawmakers stated.

Lawmakers contend that G42’s involvement creates a direct channel for foreign influence within the president’s private financial interests.

The letter also emphasized the risks to data privacy. The senators warned that foreign investors could now access sensitive financial metadata.

They stressed that wallet addresses, device identifiers, and geolocation logs of high-level US officials using the platform could be routed directly to foreign intelligence services through the project’s backend.

Bessent now faces a strict March 5 deadline to explain how the Treasury will handle the conflict. The inquiry forces the secretary to decide whether to launch a probe into a deal that enriches his boss.

Notably, this is not the first time Warren has criticized Trump’s crypto deals with the UAE. Last year, BeInCrypto reported that the lawmaker raised concerns about national security and corruption following reports about the president’s dealings with the Middle Eastern country.

TLDR:

• Dogecoin recorded the highest trading volume among all memecoins during the recent rally phase. 
• Memecoins outperformed Bitcoin significantly before entering correction while BTC remained stable. 
• Historical cycles show Dogecoin surged 95x and 310x in past rallies with third cycle developing. 
• The memecoin index tracks twelve tokens showing aggressive capital rotation into speculative assets.
  

Dogecoin spearheaded a speculative rally that pushed memecoins ahead of Bitcoin and other altcoins in recent days.

Trading volume for the leading memecoin exceeded all other tokens in its category. The surge reflects a clear shift toward higher-risk assets as market participants chase amplified returns.

Memecoins as a group delivered significant gains compared to Bitcoin’s steadier performance. The rally entered a correction phase over the weekend while Bitcoin maintained relative stability.

Trading Volume Surge Reflects Speculative Capital Shift

Dogecoin emerged as the standout performer among memecoins with the highest number of trades recorded. Market analytics platform Alphractal noted the exceptional trading activity in a weekend post.

The platform tracks a memecoin index composed of twelve tokens, including Dogecoin, Shiba Inu, Pepe, Dogwifhat, Floki, and Bonk. The index also monitors Ordinals, 1000SATS, Book of Meme, Meme, ConstitutionDAO, and Neiro.

The index showed clear outperformance against Bitcoin during the recent trading sessions. This performance gap illustrates how capital rotates aggressively into speculative assets during risk-on market phases.

Traders typically abandon conservative positions in favor of memecoins when seeking higher percentage gains.

Alphractal’s analysis highlighted that memecoins significantly outperformed Bitcoin and other altcoins over several days.

The rotation pattern matches behavior seen during previous speculative episodes in cryptocurrency markets. Retail investors often drive these movements as momentum builds around lower-priced tokens.

However, the memecoin rally showed signs of exhaustion as Sunday trading progressed. Memecoins started correcting while Bitcoin held steady at its current price levels. The divergence suggests profit-taking among traders who capitalized on the recent price spike.

Historical Patterns Suggest Extended Rally Potential

Market analyst Bitcoinsensus examined Dogecoin’s historical price cycles in recent commentary on the token. The analysis compared the current market environment to two previous bull cycles. During the first cycle, Dogecoin experienced a roughly 95-fold surge from consolidation levels.

The second cycle proved more explosive with a rally approaching 310 times the starting price. The third cycle remains in development without a clear peak forming yet.

Bitcoinsensus suggested Dogecoin could potentially reach the five-dollar zone if current patterns mirror past cycles.

Historical data shows Dogecoin performs best during strong risk-on environments across cryptocurrency markets. These rallies typically emerge after extended consolidation periods where the token trades sideways.

The breakout phase then attracts speculative capital as momentum traders enter positions.

The current market structure displays similarities to setup conditions observed before previous major rallies. Technical patterns and trading behavior show familiar characteristics from earlier cycles.

Market participants remain divided on whether historical performance will repeat given evolving market dynamics and regulatory landscapes.

TLDR:

• Bitcoin’s hard cap of 21 million coins no longer controls price due to unlimited synthetic derivatives exposure 
• Single Bitcoin can back multiple financial instruments simultaneously, creating fractional-reserve dynamics 
• Wall Street institutions manufacture inventory through cash-settled futures and perpetual swaps to control markets 
• Price discovery shifted from blockchain fundamentals to derivative positioning and liquidation flow mechanisms
  

Bitcoin has dropped below $70,000, prompting renewed debate about the cryptocurrency’s price discovery mechanism.

A crypto analyst argues that the digital asset no longer trades on simple supply and demand principles. The market structure has fundamentally changed due to derivatives layering, according to the analysis.

This shift mirrors what happened to traditional commodities when Wall Street introduced complex financial instruments. The original Bitcoin thesis may be under pressure from synthetic supply creation.

Derivatives Disrupt Bitcoin’s Scarcity Model

Bitcoin’s value proposition rested on two core principles: a hard cap of 21 million coins and resistance to rehypothecation. These foundations have been challenged by the introduction of multiple derivative products.

Cash-settled futures, perpetual swaps, options, ETFs, and wrapped BTC now dominate trading volume. Prime broker lending and total return swaps add additional layers of synthetic exposure.

Crypto analyst Danny_Crypton posted on social media that price discovery has moved away from the blockchain. The on-chain supply remains fixed, but derivatives create unlimited synthetic exposure.

This dynamic has transformed Bitcoin into a market controlled by positioning and liquidation flows. Traditional supply and demand metrics no longer apply in the same way.

The shift parallels what occurred in gold, silver, oil, and equity markets. Once derivatives overtook spot trading in these assets, price behavior changed dramatically.

Physical scarcity became less relevant than paper positioning. The same pattern appears to be unfolding in cryptocurrency markets.

Wall Street institutions can now create multiple claims on a single Bitcoin. One coin might simultaneously back an ETF share, futures contract, perpetual swap, options position, broker loan, and structured note.

This fractional-reserve structure contradicts Bitcoin’s original design philosophy. The market has evolved into something different from what early adopters envisioned.

Synthetic Float Ratio Explains Current Dynamics

The analyst introduced a metric called the Synthetic Float Ratio to explain recent price action. This measurement tracks how synthetic supply compares to actual on-chain supply.

When synthetic supply overwhelms real supply, traditional demand cannot push prices higher. Hedging requirements and liquidation cascades become the dominant forces.

Market makers can trade against Bitcoin using these derivative instruments. The strategy involves creating unlimited paper BTC and shorting into rallies.

Forced liquidations allow covering positions at lower prices. This cycle repeats, creating downward pressure regardless of underlying demand.

The current drop below $70,000 reflects these structural dynamics rather than retail selling. Institutional players use derivatives to manufacture inventory and manage risk.

Their hedging activity creates price movements that appear disconnected from on-chain fundamentals. Traditional technical analysis may miss these underlying mechanics.

The analyst claims to have successfully predicted Bitcoin tops and bottoms for over a decade. His latest warning suggests that investors should understand these structural changes.

The cryptocurrency market has matured into a derivatives-dominated ecosystem. Whether this represents progress or deviation from Bitcoin’s original vision remains a contentious topic among market participants.

PGI’s CEO spent millions on luxury cars, homes, hotels, designer clothing, jewelry, and watches using investor funds.

The US Department of Justice announced that Ramil Ventura Palafox, the CEO of Praetorian Group International (PGI), was sentenced to 20 years in prison.

Prosecutors stated that Palafox operated a $200 million Bitcoin-based Ponzi scheme that defrauded more than 90,000 investors across the world.

Bitcoin Fraud Case

According to court documents, Palafox, the 61-year-old dual citizen of the United States and the Philippines, owned and controlled PGI and served as its chairman, chief executive officer, and chief promoter. Prosecutors said Palafox falsely claimed that PGI was engaged in Bitcoin trading and marketed the firm as a multi-level marketing investment opportunity. He promised investors daily returns ranging from 0.5% to 3%.

In reality, PGI was not trading Bitcoin at a scale capable of generating those returns, and investor payouts were funded using victims’ own deposits or money from new investors. From December 2019 through October 2021, at least 90,000 investors invested more than $201 million in PGI, including approximately $30.3 million in fiat currency and at least 8,198 BTC, worth around $171.5 million at the time.

As a result of the scheme, investor losses rose to over $62 million. Court records reveal that Palafox created an online PGI portal that allowed investors to track what he represented as their investment performance. Between 2020 and 2021, the website consistently and fraudulently displayed gains, which led victims to believe their investments were profitable and secure.

Luxury Cars, Mansions, and Lies

Palafox spent roughly $3 million on 20 luxury vehicles, including models from Porsche, Lamborghini, McLaren, Ferrari, BMW, and Bentley. He also spent about $329,000 on penthouse suites at a luxury hotel chain and purchased four homes in Las Vegas and Los Angeles, estimated to be more than $6 million.

Additional spending included approximately $3 million on luxury clothing, watches, jewelry, and home furnishings from retailers such as Louboutin, Neiman Marcus, Gucci, Versace, Ferragamo, Valentino, Cartier, Rolex, and Hermès. Prosecutors said Palafox also transferred at least $800,000 in fiat currency and 100 BTC, which was then equivalent to $3.3 million, to a family member.

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The Justice Department said PGI victims may be eligible for restitution.

Separately, PGI Global’s UK entity was shut down by the United Kingdom High Court back in 2022. In April 2025, the US Securities and Exchange Commission (SEC) charged Palafox with orchestrating the massive Ponzi scheme.

TLDR:

• Virginia’s crypto kiosk bill passed both legislative chambers and now awaits the governor’s final signature. 
• New regulations impose 48-hour holds for first-time users to prevent fraud and enable transaction reversals. 
• Approximately 7% of crypto kiosk transactions involve fraud, prompting proactive regulatory intervention efforts. 
• Operators cannot market crypto kiosks as ATMs under the bill, addressing widespread consumer confusion issues.

Virginia stands on the brink of implementing comprehensive cryptocurrency kiosk oversight as regulatory legislation reaches the governor’s desk.

Both the state Senate and House approved the measure, establishing licensing frameworks and consumer protections.

The bill now requires executive approval to become law. Industry operators would face new requirements including transaction limits and identification protocols. This regulatory approach positions Virginia among states taking definitive action on crypto kiosk oversight.

Comprehensive Regulatory Measures Target Kiosk Operations

The pending legislation establishes a statewide registration system for cryptocurrency kiosk operators across Virginia. Businesses must obtain licenses and comply with ongoing reporting standards under the proposed framework.

Transaction restrictions represent a cornerstone of the consumer protection approach. Users would encounter both daily and monthly caps on amounts processed through these terminals.

First-time kiosk users face a mandatory 48-hour waiting period before transactions complete. This hold mechanism creates an opportunity to reverse suspected fraudulent purchases.

All transactions require identity verification regardless of purchase amount. Operators must display prominent warning notices on every machine about potential fraud risks.

Marketing restrictions prevent operators from describing these devices as ATMs or using related language. Delegate Michelle Maldonado explained the reasoning behind this provision.

“The fact is, it’s kind of confusing to some people because they look like ATMs. They’re shaped like ATMs. But instead of taking money out, you’re sort of putting money in to purchase crypto that goes into a broader exchange,” the Manassas-area representative said.

The legislation requires fee caps and refund mechanisms for recoverable funds. Maldonado sponsored the House version after specific Virginia fraud cases came to light.

A Southwest Virginia resident lost $15,000 through a kiosk-based scam. Similar incidents occurred in Fairfax County, demonstrating statewide vulnerability to these schemes.

Bill Responds to Growing Fraud Concerns

Industry data indicates approximately 7% of crypto kiosk transactions currently involve fraudulent activity. Maldonado views this percentage as evidence for preventive regulatory action rather than evidence of minimal problems.

“That doesn’t mean that there’s no problem. It means that it’s in the beginning. And so this is the time to put the guardrails and the safeguards in place so that 7% doesn’t grow,” she explained.

Scammers use various deception tactics to direct victims toward crypto kiosks. Fake debt collection schemes claim immediate cryptocurrency payment resolves outstanding obligations.

Fraudsters warn targets of impending legal trouble unless they purchase digital currency quickly. Romance scams frequently exploit these terminals as well.

Blockchain technology makes cryptocurrency transactions effectively irreversible once completed. “The thing about crypto is that once it goes into the exchange, which is in the blockchain environment, there’s no way to trace it. There’s no way to get it back,” Maldonado noted.

Traditional banking systems offer dispute resolution and chargeback protections that cryptocurrency transactions lack.

The delegate emphasized the broader regulatory philosophy behind the legislation. “We really want to make sure that we are educating people, that we’re giving them the tools and that we’re holding industry accountable. And that means that the way they do business in the Commonwealth matters. And there’s got to be accountability,” she stated.

AARP Virginia strongly supports the awaiting legislation. The organization highlights increased targeting of older adults through kiosk-related fraud schemes.

Nationwide losses from similar scams have reached $250,000 in individual cases. Governor action will determine whether these safeguards take effect statewide.

Michael Saylor, the co-founder of Bitcoin (BTC) treasury company Strategy, signaled that the company is acquiring more BTC amid the ongoing market dip, marking week 12 of a consecutive buying streak.

Saylor posted the Strategy BTC accumulation chart via the X social media platform on Sunday. The chart has become synonymous with BTC purchases made by the company, which is touting its upcoming 99th BTC transaction.

Strategy’s most recent BTC purchase occurred on Monday, when the company bought 1,142 BTC for more than $90 million, bringing its total holdings to 714,644 BTC, valued at about $49.3 billion using market prices at the time of publication.

Bitcoin and the broader crypto markets declined sharply following a flash crash in October that caused the price of BTC to decline by over 50% from the all-time high above $125,000 and below Strategy’s $76,000 cost basis, its average price of acquisition per BTC.

The company has continued to accumulate amid the market downturn, defying analyst suggestions that Strategy would dump its Bitcoin holdings or pause accumulation in the event of a market-wide downturn.

Related: Strategy CEO eyes more preferred stock to fund Bitcoin buys

Strategy continues to accumulate despite the collapse of crypto treasury companies

Even before October’s flash crash caused a market downturn, the crypto treasury sector was showing signs of collapse, with many treasury companies recording sharp declines in their stock prices and a collapse of mNAV, or multiple on net asset value, a critical metric for crypto treasury companies.

The multiple on net asset value, or the premium added to a company’s stock above its net asset holdings, fell below 1 for several leading crypto treasury companies by September 2025, Standard Chartered Bank warned.

Treasury companies with an mNAV above 1 have easier access to financing and stock issuance to buy more crypto.

Conversely, mNAV values below 1 signal potential trouble for these companies, as market participants price the company below the total assets it holds.

Strategy earlier this month reported a Q4 loss of $12.4 billion, sending the company’s stock price tumbling by about 17%. The shares have recovered some of that decline in recent days, closing on Friday at $133.88.

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