Tether stablecoin USDt has become the second-largest cryptocurrency by market capitalization as Ether fell to its lowest price of the year on Friday

Ether’s market capitalization dropped below $185 billion following a 5.2% price crash over 24 hours, sending the asset tumbling to $1,510 on Coinbase, according to TradingView. This allowed USDt, with a $186 billion market capitalization, to surpass the cryptocurrency. 

“[The] stablecoin overtake really highlights how the market still favors stability over ETH’s volatility right now,” Andri Fauzan Adziima, research lead at Bitrue Research Institute, told Cointelegraph. 

The development reflects accelerating stablecoin growth, which currently represents almost 15% of the entire crypto market capitalization. Stablecoin supply contracted more than 30% in the last bear market, but they’re hitting record highs this time, wrote 21Shares on Thursday, adding:

“To us, that is the strongest evidence yet that stablecoins are one of crypto’s defining use cases – demand that no longer depends on the cycle.”

USDt flipped ETH in market capitalization. Source: CoinGecko

Alvin Kan, chief operating officer of Bitget Wallet, told Cointelegraph that the flip is a “notable milestone that highlights the explosive growth and dominance of stablecoins in today’s crypto ecosystem.”

“It demonstrates strong demand for reliable, liquid on- and off-ramps during periods of volatility, while serving as a reminder that ETH must continue delivering compelling utility and narrative momentum to maintain its position.” 

Kan said the development is positive for the broader market, as deeper stablecoin liquidity supports higher trading volumes and ecosystem innovation.

Related: Sharplink buys ETH after 8-month pause as token hits 2026 low

ETH prices are back at crucial support levels last visited in October 2023 and April 2025.

The Ethereum ecosystem has also faced internal changes recently, following several executive departures and a 20% workforce reduction at the Ethereum Foundation.

However, a new nonprofit organization called Ethlabs was launched this week by key EF developers and researchers and backed by Ether treasuries Bitmine and Sharplink. 

ETH prices are at a critical long-term support level. Source: TradingView

Not all are bearish  

Some have taken Ether’s decline as an opportunity.

Ether treasury company Sharplink bought the dip, making its first purchase in eight months, scooping up 5,000 ETH on Thursday. Bitmine, chaired by Tom Lee, has also been accumulating at these low prices, adding a further 76,881 ETH last week. 

Meanwhile, Circle’s USDC (USDC) also flipped Ripple’s XRP (XRP) in market capitalization as XRP fell back towards $1, its lowest level since November 2024, leaving XRP with a market capitalization of $64 billion compared with USDC’s $73.6 billion.

Magazine: AI is banking the unbanked in Africa… faster than crypto

Base, the blockchain developed by Coinbase, has resumed normal operations after an outage that lasted nearly two hours and stemmed from a consensus failure that prevented block production.

Base confirmed on Thursday that its blocks were once again being produced normally and that it had verified recovery across the broader ecosystem following the disruption. The incident was tracked publicly via Base’s status page, which first flagged unhealthy block production before later describing the specific consensus issue.

Key takeaways

• Base reported a near two-hour outage caused by a consensus problem that sequenced an invalid block and stopped new block creation.
• The network later restored “healthy blockbuilding,” and infrastructure across the ecosystem was able to sync again.
• Base said it had identified the issue and would investigate the underlying cause with a full post-mortem.
• The downtime was notable because Base is among the most widely used Ethereum layer-2 networks.
• An upgrade scheduled for shortly after the outage—Beryl—was completed hours later, after the incident.

Outage traced to consensus and invalid block sequencing

Base’s status page reported that the team was investigating “unhealthy” block production at 4:03 pm UTC on Thursday. Less than an hour later, Base said it had isolated a consensus problem in which an invalid block was sequenced. According to the status update, that sequence effectively halted block production, meaning no new blocks could be created during the period.

In a subsequent update just before 6 pm UTC, Base stated that it had recovered healthy blockbuilding, and that ecosystem-wide infrastructure had returned to a synced state. The team added that it had identified the issue and would continue investigating the root cause, promising a full post-mortem.

Base also posted the recovery status on X via its official account, saying blocks were being produced normally and that it had confirmed widespread recovery throughout the ecosystem.

Why Base downtime is noteworthy for Ethereum layer-2 users

While outages can happen across blockchain networks, a disruption of this nature is comparatively rare for major systems—particularly for networks that are heavily relied upon for daily activity. Base is described in the report as one of the most used Ethereum layer-2 networks.

Base previously experienced a significant outage in August 2025, when it went down for 33 minutes, as indicated in a separate incident recorded on its status page. The latest event therefore adds another high-visibility reliability test for users and operators who depend on Base for time-sensitive transactions and on-chain application workflows.

The reporting around the incident also emphasized that Base’s creator, Jesse Pollack, said funds on the network were safe. However, even when assets are not at risk, a halt in block production can affect confirmations, withdrawals, and the overall throughput that applications expect from a live network.

Timing around the Beryl upgrade

According to the report, the downtime appeared to occur separately and just hours ahead of a scheduled Base upgrade known as Beryl. The upgrade was set for 6 pm UTC and was reported as completed at 8 pm UTC, two hours later.

Base’s Beryl update was intended to reduce delays on withdrawals and introduce a new token standard for real-world assets and stablecoins. For users, those changes can directly influence how quickly funds move out of the system and how new tokenized products are represented on-chain. For infrastructure providers, upgrades also increase operational complexity—making it especially important that the network returned to healthy block production before or during the transition.

Wider reliability signals across competing networks

Base’s outage also fits into a broader pattern of occasional block-production stalls across large networks. The report points to Sui, which experienced two separate periods of downtime on back-to-back days in May, each causing a temporary block-production halt. Sui later stated that the downtime resulted from a network update it had assessed as having a low probability of causing a halt.

That detail matters because it highlights a recurring challenge in blockchain operations: even carefully planned upgrades can create unforeseen edge cases. In Base’s case, the immediate cause was described as a consensus problem that prevented block creation, and the team indicated it would investigate the root cause. Readers may want to watch whether Base’s post-mortem explains how the failure relates to network parameters, client behavior, or sequencing logic—and whether similar failure modes could recur.

What to watch next

Base says it has identified the issue and will publish a root-cause analysis. The key follow-up will be how the post-mortem explains the consensus failure and what safeguards are added to prevent invalid block sequencing and restore even more resilient block production—particularly around future upgrades like Beryl.

SharpLink has bought Ether for the first time in eight months as ETH traded near its lowest level of 2026. 

The latest move suggests the company may be restarting active accumulation after months of relying mainly on its existing treasury and staking rewards.

According to Lookonchain, a wallet linked to SharpLink received 5,000 ETH, worth about $7.85m, from FalconX. The on-chain tracker said SharpLink last received ETH from FalconX in October, when it bought about $78.3m worth of the token.

South Korea’s Personal Information Protection Commission (PIPC) has ordered cryptocurrency exchange operator Bithumb to pay a $136,000 fine for violating personal information protection rules tied to cross-border data transfers. The decision underscores the legal expectations for consent and handling of personal data when crypto trading activities involve overseas counterparties.

In a notice issued on Thursday, the PIPC said its investigation found Bithumb transferred personal information overseas without separate consent from data subjects during processes related to “order book sharing” and “virtual asset transfer” with foreign exchanges. The regulator linked the conduct to Bithumb’s arrangements involving Tether (USDT) trading data and user information sharing with multiple overseas platforms.

Key takeaways

• PIPC imposed a $136,000 fine on Bithumb for breaches of South Korea’s personal data protection requirements involving overseas transfers.
• The regulator found Bithumb shared personal information with 13 overseas exchanges and also used overseas counterparties to facilitate order book sharing and virtual asset transfers.
• PIPC acknowledged an anti-money laundering rationale for providing certain information, but emphasized strict compliance for cross-border transfer and data-subject self-determination.
• The case highlights how crypto compliance programs must address privacy and consent alongside AML/KYC obligations.

PIPC’s findings: cross-border transfers and the consent requirement

According to the PIPC notice, the regulator’s review focused on how Bithumb conducted certain operational integrations with foreign trading venues. The PIPC stated that Bithumb transferred personal information overseas without obtaining separate consent from the data subjects in the context of order book sharing and virtual asset transfer workflows.

The decision cites order book sharing for USDT between September and November 2025, when Bithumb worked with BingX. The PIPC further noted that while Bithumb obtained consent to share data with Stellar, it still carried out overseas data sharing through additional channels.

The PIPC’s framing is important for compliance teams: even where an exchange can justify the need to share information for anti-money laundering purposes, regulators may still require that cross-border personal-data transfers meet the procedural and consent standards under South Korea’s Protection Act.

Why the decision matters for exchanges and compliance programs

For crypto firms operating internationally—or coordinating with overseas counterparties—this case illustrates a practical enforcement boundary between AML-related information sharing and privacy law obligations. The PIPC explicitly recognized the necessity of providing personal information for AML when transferring virtual assets to other exchanges. However, it concluded that, with respect to overseas transfer of personal information, exchanges must treat the issue as closely connected to individuals’ rights.

In practice, the compliance implication is that exchanges may need more granular consent management and documented procedures around cross-border data flows. That includes assessing whether existing consents cover each specific foreign transfer pathway, whether the scope aligns with the intended processing and recipients, and whether data-sharing arrangements reflect the “data subject’s right to self-determination” described in the notice.

This also raises operational questions for regulated market participants: privacy controls cannot be treated as a one-time onboarding step. Instead, they must be maintained as exchanges expand routing, liquidity sharing, or transfer mechanisms across borders.

Enforcement context: Bithumb under regulatory scrutiny

Bithumb is one of South Korea’s largest cryptocurrency exchanges and has faced intense regulatory attention. The exchange has previously been subject to actions by financial authorities over alleged violations of South Korea’s Financial Information Act. In March, the country’s financial regulator imposed a six-month suspension, but a court later reversed that decision in April.

More recently, reporting indicated that police conducted raids at Bithumb’s offices as part of an investigation related to alleged nepotism involving a South Korean lawmaker, adding to the broader compliance and governance scrutiny surrounding the firm.

While these matters span different regulatory regimes—personal data protection versus financial supervision and other enforcement areas—they collectively signal a risk that institutional stakeholders cannot separate privacy, market conduct, and governance issues in crypto oversight. For banks, payment firms, and institutional investors with exposure to crypto ecosystems, such enforcement patterns can affect counterparties’ compliance posture and the perceived robustness of their control environments.

Broader policy backdrop: tax changes and law enforcement coordination

South Korea’s crypto regulatory environment is also evolving through fiscal and public-safety measures. The Ministry of Finance confirmed in May that a 22% tax on cryptocurrency gains is scheduled to take effect beginning January 2027, after previous postponements. The change is likely to affect a large base of retail investors holding digital assets in the country.

In parallel, blockchain analytics and law enforcement coordination has moved forward. Chainalysis reported a memorandum of understanding with the Korean National Police Agency (KNPA) intended to enhance investigative capability within South Korea. The stated focus includes improving responses to crypto crime, including attacks linked to North Korea.

Taken together, these policy directions show that South Korean authorities are simultaneously strengthening compliance expectations for regulated entities and expanding domestic enforcement capacity. The Bithumb privacy fine fits within this wider trend: regulators are treating data protection and cross-border information handling as part of the overall integrity framework for crypto markets.

Closing perspective

The PIPC’s order against Bithumb highlights that exchanges must align their AML-driven information-sharing processes with privacy consent and cross-border transfer requirements. Compliance leaders should watch for how similar cases are handled in South Korea—particularly around data transfer scopes tied to liquidity/order book sharing—since enforcement could shape how crypto firms structure cross-border operational integrations.

South Korea’s Kospi tumbled as much as 9%, triggering its second trading halt of the week, as chipmakers SK Hynix and Samsung both fell more than 8%. Nasdaq 100 futures fell 1.5%. Brent crude slipped below $74 a barrel, easing little of the pressure, after a projectile strike on a vessel in the Strait of Hormuz briefly revived supply concerns.

The crypto-specific selling added to it. Part of bitcoin’s pullback came from large holders selling sizable amounts into a market that has been slow to absorb the extra supply, said Gabe Selby, head of research at CF Benchmarks, in an email to CoinDesk.

He said much of the new money and investor attention has flowed into AI plays lately, leaving crypto fighting for a smaller share of overall risk appetite, and described the move as a broad market cooldown rather than anything broken in crypto itself.

Selby sees the current zone as the one that has historically halted bitcoin’s declines. “Bitcoin has pulled back into the $50,000 to $60,000 zone today, and if history is any guide, this is where buyers step in,” he said.

That leaves the market where it has traded all week, with bitcoin leaning on a level it has not lost in nearly two years while the altcoins around it weaken faster. Selby further pointed to $55,000 as the support to watch below and $61,000 to $62,000 as the level bulls need to reclaim, and advised keeping position sizes sensible.

On-chain investigator ZachXBT has warned that centralized exchange AscendEX may be delaying user withdrawals due to possible liquidity stress. 

The alert followed several user reports claiming that withdrawals had been pending for days or weeks.

AscendEX, formerly known as BitMax, has not issued a public response to the latest claims at the time of writing. ZachXBT said he reviewed known exchange hot wallets on Arkham and TRM. He said the wallets appeared to lack large assets such as ETH, USDT, USDC and SOL.

Wallet review raises reserve questions

ZachXBT said the wallet review points to possible liquidity issues, but the claim has not been confirmed by AscendEX. He said the exchange may be delaying or failing to process some withdrawal requests. He also shared EVM, Tron and Solana hot wallet addresses linked to the review.

“I have observed multiple reports that the centralized exchange AscendEX is delaying user withdrawals for days / weeks or not processing withdrawals,” ZachXBT said in his alert.

He added that its reserves “appear to lack large cap tokens” such as ETH, USDT and SOL. The wording leaves room for further verification because exchange reserves can include cold wallets, third-party custody or wallets not publicly labeled.

AscendEX history adds context

AscendEX was founded in 2018 by George Jing Cao and Ariel Ling. The exchange became known as BitMax before its later rebrand. In December 2021, the platform was reportedly hacked for about $78m in assets, with the Lazarus Group later linked to the attack.

The new alert comes at a time when users remain sensitive to withdrawal delays across smaller and mid-sized exchanges. As crypto.news reported, ZachXBT also flagged JuCoin over withdrawal delays and reserve concerns earlier this month. In that case, users questioned whether reported reserves were backed by liquid third-party assets.

Users look for proof of liquidity

AscendEX’s own help center says withdrawals usually move through platform verification, blockchain confirmation and receipt by the target wallet. It also says users should receive a TXID once AscendEX completes the transfer to the blockchain. The help center tells users to contact support if no TXID is generated within two hours after a withdrawal request.

That guidance matters because several complaints around exchange delays often center on the same point: funds leave the available balance, but no blockchain transaction appears. Without a TXID, users cannot verify whether the asset has moved on-chain. That makes communication from the exchange more important during stress.

Previously, crypto.news explored how reserve reports can fail to calm users when withdrawal pressure builds. The same issue now applies to AscendEX. Users need clear timelines, wallet transparency and proof that major assets remain available for withdrawal.

The situation remains developing. ZachXBT’s claims raise concern, but they do not prove insolvency. AscendEX can reduce uncertainty by publishing a clear update, explaining any delays and showing verifiable asset balances across hot and cold wallets. Until then, the alert is likely to keep pressure on the exchange and its reserve practices.

Coinbase-backed Base returned online after a consensus issue stopped block production for almost two hours on Thursday. 

The Ethereum layer-2 network said blocks were again being produced normally after engineers worked through the incident.

Base first reported unhealthy block production on its official status page at 4:03 p.m. UTC. The team later said it had isolated a consensus problem that caused an invalid block to be sequenced. That event stopped new blocks from being created after block 47,806,542.

In a later X update, Base said, “blocks are being produced normally” and that it had verified broad recovery across the ecosystem. The team added that it would continue to investigate the root cause and share a full post-mortem.

The outage marked a rare halt for one of the busiest Ethereum scaling networks. Base supports trading, payments, apps and token transfers for users and builders. A block production pause stops new on-chain activity until the network resumes.

Pollak says funds were safe

Base creator Jesse Pollak said user funds were safe during the outage. In a post on X, he said, “funds are safe,” but added that “a halt is not okay” for a platform trying to support global finance.

The statement aimed to calm users while also acknowledging the seriousness of the halt. Network downtime can affect apps, wallets, exchanges and bridge services that depend on fresh blocks. It can also delay transactions that users expected to settle quickly.

Base said ecosystem node operators needed to restart nodes to recover syncing. The status page also said internal nodes had resumed syncing correctly. That step helped infrastructure providers return to normal after sequencing resumed.

The team did not give a final technical explanation beyond the invalid block and consensus problem. A fuller report is expected to explain how the invalid block entered sequencing, why the chain stopped, and what checks will change.

Beryl upgrade adds timing pressure

The outage happened just before Base completed its Beryl upgrade. The upgrade was scheduled around the same day and later went live after the network recovered. Beryl aims to cut some withdrawal delays and support a new B20 token standard for assets such as stablecoins and real-world asset tokens.

Meanwhile, the Beryl upgrade reduces the standard Base-to-Ethereum withdrawal delay from seven days to five days. It also introduces a native token standard built into Base’s node software rather than only through smart contracts.

As previously reported, Base suffered a 33-minute outage in August 2025 after a sequencer handoff problem stopped block production. That earlier incident also led to infrastructure changes and more testing.

The new halt may renew questions about sequencer design and uptime. Base plays a growing role in Coinbase’s wider product plans. Coinbase has been expanding beyond crypto trading into stocks, lending, payments and AI-linked tools.

Reliability remains key for institutions

Base has also become important for institutional blockchain use. In a previous article, crypto.news discussed JPMorgan launching JPM Coin on Base for faster institutional payments and 24/7 settlement. That kind of use requires strong uptime and clear recovery steps when problems appear.

Base is not the only major network to face downtime this year. Previously, crypto.news explored Sui’s second network stall in May, when block production stopped and the SUI token fell. The Base incident shows that even large networks can face edge-case failures.

For now, Base says block production has recovered. The next test will be the post-mortem. Users and builders will look for a clear cause, a fix, and steps that reduce the chance of another halt.