Japan reclassified cryptocurrencies as financial instruments, a structural shift that establishes the legal framework for separate taxation of crypto assets and for future crypto exchange-traded funds (ETFs).

The legislation approved by Parliament on Wednesday amends the Financial Instruments and Exchange Act and the Payment Services Act (PSA). It shifts crypto from a framework in which it was primarily treated as a payment tool to one that treats it as an investment alongside other financial instruments. The new rules are expected to take effect in 2027.

The new framework also removes a key legal hurdle for future spot bitcoin exchange-traded funds (ETFs), although lawmakers did not approve any ETF products. Financial Services Agency officials said Japan will now consider developing a regulatory framework for crypto ETFs.

The legislation raises the maximum prison term for unregistered crypto operators from three years to 10 years and increases the maximum fine from 3 million yen ($18,500) to 10 million yen. It also introduces stricter insider-trading rules and expands disclosure requirements for crypto issuers and exchanges.

Noxa, the largest token launchpad on Robinhood Chain, stopped operating after earning an estimated $12 million in fees, according to DefiLlama, in the past week, citing concerns about low-quality tokens flooding the platform.

The shutdown unfolded in a matter of days. On July 11, just as CASHCAT, the chain’s breakout memecoin, was hitting peak trading volume, Noxa said it would stop accepting new token launches.

Two days later, the platform’s website went dark. The team blamed a Cloudflare issue. On July 14, it said the domain would redirect to ENS services and creator earnings would be available for withdrawal. Late Tuesday night, Noxa posted that the platform would no longer collect fees, redirecting 100% of transaction revenue to creators instead.

The decision divided Crypto Twitter.

“Half the timeline called it based because someone finally pushed back against the spam,” wrote @zubic_eth in a widely shared post summarizing the situation. “The other half called it a generational fumble and said they killed the golden goose while making $3 million a day.”

The figures contrast with BlackRock’s broader business, which posted record assets under management (AUM) of $15.3 trillion after attracting $192 billion in net inflows during the quarter. The company also beat Wall Street expectations with adjusted earnings per share of $13.91 on $7.08 billion in revenue.

BLK shares traded 4.15% higher at £1,068 in pre-market trading Wednesday.

BlackRock’s crypto target

BlackRock is targeting $500 million in annual revenue from the business under its 2030 plan, the firm said in its earnings call.

This would represent an increase of more than tenfold, compared to the $40 million BlackRock currently generates in base fees and securities lending, accounting for less than 1% of the firm’s total fee revenue.

BlackRock has steadily expanded its crypto ETF lineup since listing its spot bitcoin ETF (IBIT) and spot ether ETF (ETHA), in 2024. More recently, the firm introduced the iShares Bitcoin Income ETF (BITY), which seeks to generate income by writing covered call options on bitcoin exposure, offering investors an alternative to simply tracking the cryptocurrency’s price.

The asset manager also manages $60 billion of Circle’s reserves, about one-quarter of the $300 billion stablecoin market, and wants to become the industry’s reserve manager of choice, it added.

BlackRock pointed to 5 billion crypto wallets as a new distribution channel for its traditional investment products during the earnings call.

Just a few short years ago, the crypto hype was strong. VCs were eager to pour money into solutions for scalability, data availability, and any number of buzzwords.

Since then, the advent of powerful AI models and prolonged bear markets have taken the wind out of crypto’s sails and many chains which promised the future are now as good as forgotten.

One keen-eyed X user, crypto marketer Stacy Muur, noted the staggering $500 million invested across six blockchain projects which, together, have produced a total of just $360 in blockchain fees in the past 24 hours.

Read more: AscendEx shutdown: Uncertainty over withdrawals as hot wallets lack funds

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The claim caught Protos’ eye, so we took a look at the six companies to see where it all went wrong.

Berachain

Berachain is a blockchain born as a spinoff of the 2021-era Bong Bears NFT collection. It claims to be the first proof-of-liquidity based chain, and aims to be a “growth engine for onchain businesses.”

The project raised a total of $142 million across two rounds in 2023 and 2024. 

However, according to its most recent EoY statement, the project has struggled amidst issues with sentiment, shrinking crypto-native TAM and “increased skepticism around the value of infrastructure as a whole.”

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Since launching in early 2025, its BERA token is down 98%.

Berachain was among the networks caught up in November’s devastating Balancer hack, leading validators to temporarily halt the network.

Later that same month, it was revealed that one of the backers, Brevan Howard’s Nova Digital, was granted a one year, risk-free refund right on its $25 million investment.

Read more: Balancer exploit drains $129M in DeFi disaster

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Celestia

Celestia was seen as a hot ticket back in 2023 when “data availability” was the buzzword du jour.

Part of the Cosmos ecosystem, it promises bespoke, high throughput, modular chains “for companies with internet-scale traffic.”

It raised first $1.5 million in 2021, a further $50 million in 2022 and finally $100 million in 2024.

Its much-hyped token launch was one of the first rays of light following a deep bear market sparked by the catastrophic crypto collapses of 2022.

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Despite initially surging around 10x in its first months to an all-time high of over $20, TIA eventually bled approximately 98%, sitting today at $0.40.

Scroll raised a total of $83 million over three funding rounds, the latest of which brought the Ethereum L2 to a $1.8 billion valuation in March 2023.

It made just $24 in fees yesterday.

The zkEVM layer two hit a peak TVL of $585 million as users enthusiastically farmed an ultimately disappointing airdrop. In the aftermath, the network lost around 75% of its TVL within a couple of months.

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There’s currently just under $12 million on the chain.

Eclipse

Eclipse billed itself as “Solana on Ethereum,” an SVM layer two network which would pair Solana’s performance with Ethereum’s liquidity.

Developer Eclipse Labs raised a total of $65 million, most of which came in a $50 million Series A, led by Placeholder and Hack VC, in March 2024.

DeFiLlama data shows the chain’s TVL peaking at almost $50 million in late February last year. It’s currently down to just $1.15 million, a drop of approximately 98%.

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The project’s most recent blog post is from a year ago, announcing the launch of its token ES, and an airdrop. Eclipse Labs has since pivoted to development of The Human API, a marketplace for AI agents to hire humans.

Sonic

Launched as Fantom by controversial developer Andre Cronje, founder of DeFi stalwart Yearn Finance, the fast, low-cost network migrated to Sonic in 2024. It raised a total of $61 million across six rounds between 2018 and 2024, according to ICODrops.

As Fantom, it took a hit in the Multichain debacle, with many bridged assets depegged from their native versions.

Fantom’s peak TVL reached a staggering $7.9 billion in 2022 and now sits at just under $5 million. Sonic’s hit $1.2 billion last spring, but has since dropped to $16 million.

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Cronje’s involvement with Sonic terminated last month and he’s spent much of the last 18 months building Flying Tulip.

Read more: Andre Cronje says someone stole his code to build a $1B DeFi project

Manta

ZK-focused Manta raised a total of $60 million across four rounds between 2021 and 2023. 

Its TVL chart is dramatic, highlighting an intense, heavily gamified airdrop campaign, which saw over $650 million poured into the chain.

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Just a few weeks before its peak, TVL sat at under $20 million. Likewise, within four months, it was back below $50 million once again. Today, just $4 million is held on the chain.

Got a tip? Send us an email securely via Protos Leaks. For more informed news and investigations, follow us on X, Bluesky, and Google News, or subscribe to our YouTube channel.

Japan is set to reshape its cryptocurrency market with stricter trading rules, stronger user protections and a framework closer to traditional finance.

The country’s parliament on Wednesday passed revisions that classify crypto assets as financial assets under Japan’s Financial Instruments and Exchange Act (FIEA), according to a report by local news agency Nikkei.

The changes move Japan’s crypto regulation away from the Payment Services Act (PSA), which treated digital assets primarily as payment instruments, and introduce insider trading rules and stronger oversight for crypto businesses.

The overhaul marks one of Japan’s biggest shifts in digital asset policy as regulators worldwide continue debating how crypto should fit within existing financial systems.

Crypto exchanges face tougher oversight

Under the revised framework, crypto businesses operating in Japan will face additional compliance obligations designed to improve market integrity and protect users.

The updated rules prohibit issuers, exchanges and other market participants from trading while aware of undisclosed material information, creating insider trading restrictions similar to those applied in traditional finance (TradFi).

Source: Reuters Legal

The revised rules increase penalties for companies operating without registration, reportedly raising the maximum prison sentence from three years to 10 years and increasing fines from around 3 million Japanese yen ($19,000) to around 10 million yen.

Related: Japan stablecoin payments advance with Lawson trial, Netstars launch

Insider trading violations could result in penalties of up to five years in prison, fines of up to 5 million yen, or both, the report notes.

Global regulators align crypto with financial rules

In line with Japan’s move to bring crypto closer to TradFi, the revised law also reportedly changes the terminology for registered businesses from “cryptocurrency exchange” to “cryptocurrency trading company.” The change reflects the broader financial role regulators now assign to the sector.

Japan’s crypto regulation developments reflect a broader global trend of regulators applying existing financial frameworks to crypto rather than treating the sector as entirely separate.

South Africa’s tax authority published draft guidance in early July outlining how existing tax rules apply to crypto assets, while US regulators continue clarifying how existing securities and commodities laws apply to digital assets.

Magazine: Thai scammer’s $122M wallet, Japan embraces crypto credit: Asia Express

BNB Chain has completed its 36th quarterly token burn, permanently removing 1,615,827.795 BNB from circulation.

The tokens were worth about $931.7 million when the burn took place on July 15, according to the official BNB Chain announcement.

Introduction

The internet transformed how the world communicates, shares information, and conducts business. Yet, despite these advances, financial infrastructure remains fragmented, permissioned, and heavily dependent on centralized institutions. Payments can take days to settle, billions remain unbanked, and access to financial services often depends on geography, identity, or institutional approval.

Decentralized Finance (DeFi) is changing that narrative.

Rather than simply offering an alternative to traditional banking, DeFi is evolving into critical digital infrastructure—a foundational financial layer that anyone can access, build upon, and integrate into the next generation of applications. Just as the internet became essential infrastructure for information, DeFi is becoming essential infrastructure for value.

What Makes Infrastructure “Critical”?

Critical infrastructure refers to systems that society depends on every day. Electricity grids, telecommunications networks, transportation systems, and cloud computing platforms all fall into this category because they enable countless services to function.

DeFi increasingly shares these characteristics:

• Operates continuously without business hours
• Accessible globally through an internet connection
• Open for developers to build on
• Resistant to single points of failure
• Transparent and verifiable
• Programmable by design

Instead of replacing banks outright, DeFi provides the financial operating system that applications, businesses, and even governments can leverage.

Financial Services Become Internet Primitives

One of DeFi’s greatest innovations is transforming financial functions into programmable building blocks.

Developers no longer need to build payment networks, lending systems, exchanges, or settlement infrastructure from scratch.

Instead, they can integrate existing DeFi protocols much like developers use cloud storage or payment APIs today.

These financial primitives include:

• Stablecoin payments
• Decentralized lending
• Automated exchanges
• On-chain collateral management
• Yield-generating vaults
• Cross-chain asset transfers
• Tokenized real-world assets

This composability dramatically accelerates innovation while reducing infrastructure costs.

Always-On Global Finance

Traditional financial infrastructure still operates within numerous constraints:

• Banking hours
• National borders
• Multiple intermediaries
• Settlement delays
• High remittance costs
• Manual reconciliation

DeFi removes many of these limitations.

Transactions settle around the clock.

Capital moves continuously.

Applications operate regardless of weekends or holidays.

This always-on availability is particularly valuable for global businesses, remote workers, digital creators, and international commerce.

Stablecoins: The Infrastructure Layer for Digital Payments

Stablecoins have quietly become one of DeFi’s most important components.

Rather than focusing on speculation, stablecoins enable:

• International payroll
• Merchant payments
• Cross-border settlements
• Treasury management
• E-commerce transactions
• Institutional liquidity

For many users, stablecoins represent their first interaction with blockchain technology—not because they are interested in crypto, but because they need faster, cheaper, and more reliable payments.

As adoption grows, stablecoins increasingly resemble digital public utilities for money movement.

Open Infrastructure Encourages Competition

Traditional financial systems often rely on closed networks where innovation depends on permission from intermediaries.

DeFi changes this dynamic.

Anyone can build:

• Wallets
• Trading platforms
• Lending markets
• Insurance protocols
• Payment applications
• Asset management tools

Developers compete on user experience rather than exclusive access to infrastructure.

This openness creates a healthier ecosystem where innovation moves faster, and users benefit from better services.

Programmable Money Changes Everything

Money is no longer limited to being stored or transferred.

With smart contracts, money becomes programmable.

Examples include:

• Automatic revenue sharing
• Instant royalty payments
• Escrow without intermediaries
• Streaming salaries by the second
• Automated subscriptions
• Conditional business payments
• Machine-to-machine commerce

As artificial intelligence and the Internet of Things expand, programmable financial infrastructure becomes increasingly important.

Machines will eventually need financial systems that operate autonomously.

DeFi is uniquely positioned to support this future.

Infrastructure for Tokenized Real-World Assets

Governments, financial institutions, and enterprises are exploring tokenization at an unprecedented pace.

Assets that can be represented on-chain include:

• Government bonds
• Treasury bills
• Corporate debt
• Real estate
• Commodities
• Private credit
• Carbon credits

DeFi provides the infrastructure where these assets can be:

• Traded
• Borrowed against
• Used as collateral
• Fractionalized
• Settled instantly

Rather than building entirely new financial rails, institutions increasingly connect to existing decentralized infrastructure.

Resilience Through Decentralization

Critical infrastructure must remain operational even under stress.

Traditional systems face risks such as:

• Data center outages
• Banking failures
• Political instability
• Regional disruptions
• Single points of failure

Public blockchain networks distribute operations across thousands of independent nodes worldwide.

Although no system is perfect, decentralization significantly reduces dependence on any single operator.

This resilience is becoming increasingly valuable in an interconnected global economy.

Challenges Before DeFi Can Become Global Infrastructure

Despite remarkable progress, several challenges remain.

Scalability

Infrastructure must support millions—or even billions—of users without sacrificing performance.

User Experience

Wallet management, onboarding, and security remain difficult for many newcomers.

Regulatory Clarity

Governments continue developing frameworks that balance innovation with consumer protection.

Security

Smart contract vulnerabilities, exploits, and protocol risks must continue to decline through better development practices and auditing.

Interoperability

The future financial system will likely span multiple blockchains rather than a single dominant network.

The Infrastructure We Don’t Notice

The most successful infrastructure often becomes invisible.

Few people think about:

• DNS when browsing websites.
• TCP/IP when sending emails.
• Cloud servers when using mobile apps.

Similarly, future users may never realize they’re using DeFi.

They’ll simply:

• Send money instantly.
• Receive salaries globally.
• Trade tokenized assets.
• Earn yield automatically.
• Purchase digital goods.
• Access financial services from any device.

The blockchain becomes invisible while the experience becomes seamless.

Conclusion

DeFi is evolving far beyond decentralized exchanges and yield farming. It is becoming the programmable financial infrastructure that can power digital commerce, tokenized assets, global payments, AI-driven economies, and next-generation internet applications.

The future of finance may not be defined by who owns the infrastructure, but by who can build on top of it. In that future, DeFi serves as the open, resilient, and interoperable foundation—enabling innovation at internet scale.

As digital economies continue to expand, the most important question may no longer be whether DeFi can compete with traditional finance, but whether tomorrow’s financial system can function efficiently without the open infrastructure that DeFi provides.

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