Wall Street market maker Jane Street reduced its exposure to Bitcoin exchange-traded funds (ETFs) in the first quarter of 2026 while increasing positions in Ether funds.

Jane Street cut major Bitcoin ETF holdings in Q1 2026, including BlackRock’s iShares Bitcoin Trust (IBIT) and Fidelity Wise Origin Bitcoin Fund (FBTC), according to a 13F filing published Tuesday.

IBIT holdings fell about 71% from Q4 2025 to roughly 5.9 million shares valued at about $225 million, while FBTC dropped about 60% to around 2 million shares worth roughly $115 million.

At the same time, Jane Street increased its exposure to Ether (ETH) ETFs, nearly doubling its position in BlackRock’s iShares Ethereum Trust (ETHA) and sharply raising its stake in Fidelity Ethereum Fund (FETH), adding about $82 million combined across the two products over the quarter.

The move comes amid early signs of institutional Ether ETF buying in early 2026, including increased exposure reported at Wells Fargo. The filing points to a reshuffling of Jane Street’s reportable crypto-linked holdings at quarter-end, though 13F disclosures do not show the market maker’s full trading book or net exposure.

Bitcoin exposure weakens further as Strategy stake falls

Jane Street’s Bitcoin-linked exposure weakened further in Q1 2026 as it reduced its stake in Michael Saylor’s Strategy (MSTR) alongside major ETF cuts.

In Q4 2025, the firm held about 968,000 MSTR shares worth roughly $145.9 million. By Q1 2026, the common stock stake fell to about 210,000 shares valued at roughly $27 million, a decline of about 78% quarter-over-quarter.

Jane Street increased its Strategy (MSTR) position by 473% in Q4 2025. Source: TheBTCTherapist

Strategy selling followed significant buying in the previous quarter as Jane Street reportedly increased MSTR position by 473% in Q4 2025.

In Q1 2026, the company also trimmed exposure across several Bitcoin mining stocks, including IREN, Cipher Mining, TeraWulf and Core Scientific.

Increased exposure to Coinbase, Galaxy and Riot

Despite broad downside pressure on Bitcoin-related assets, Jane Street increased exposure to several crypto-linked equities over the quarter, suggesting more selective positioning in crypto-related equities rather than a broad exit from the sector.

Jane Street raised its stake in the crypto mining company Riot Platforms (RIOT) to about 7.4 million shares, up from 5 million, increasing its value to roughly $91 million from $63 million.

It also increased its position in Coinbase (COIN) to about 888,000 shares from 778,000, with the value rising to about $155 million from $176 million in the prior quarter.

Related: EToro profits rise as commodities boom offsets crypto trading slump

Galaxy Digital (GLXY) saw the sharpest expansion, jumping to about 1.5 million shares from just around 17,000, lifting its value to roughly $28 million from around $380,000.

Jane Street posted a record $16.1 billion in Q1 trading revenue, according to Reuters, as volatile markets and gains tied to artificial intelligence-related investments boosted financial results.

Magazine: Strategy reveals why they would sell BTC, Trump Media posts loss: Hodler’s Digest, May 3 – 9

Vietnam could see the first official activity in its regulated crypto asset market as early as the third quarter of 2026, Deputy Minister of Finance Nguyen Duc Chi said at the Digital Trust in Finance 2026 forum.

“We believe that, as early as the third quarter, Vietnam could witness the first official activities of its crypto asset market, operating under a framework designed to ensure safety and transparency,” Chi said Tuesday, according to VnEconomy.

The comments mark another step in Vietnam’s effort to bring one of Asia’s most active crypto markets under formal supervision, after regulators opened a licensing pathway for domestic crypto asset trading platforms earlier this year.

The push is tied to Vietnam’s broader digital economy strategy, which reportedly targets a digital economy worth at least 30% of gross domestic product by 2030, with 80% of transactions conducted cashlessly and more than 40% of enterprises involved in innovation activities.

Vietnam targets regulated crypto launch

In March, five Vietnamese companies had reportedly passed the initial qualification round in a race to launch the country’s first regulated cryptocurrency exchange. The companies included affiliates of private banks Techcombank, VPBank and LPBank, alongside stockbroker VIX Securities and conglomerate Sun Group.

In February, Vietnam drafted a tax framework that would tax crypto transactions akin to traditional securities trading, proposing a 0.1% individual tax on each crypto transaction processed through a licensed provider.

Cointelegraph contacted Vietnam’s Ministry of Finance for comment but had not received a response by publication.

Related: LMAX Group launches digital asset collateral solution for institutions

Vietnam ranks 4th in global crypto adoption

Vietnam remains one of the world’s most active crypto markets, ranking fourth in Chainalysis’ 2025 Global Crypto Adoption Index behind India, the United States and Pakistan.

Global cryptocurrency adoption index. Source: Chainalysis

Vietnam has also emerged as a major hub for crypto trading in Asia, ranking third in terms of onchain value received with $200 billion in estimated transactions over the 12 months to June 2025, behind India and South Korea.

However, most traders still rely on offshore cryptocurrency exchanges such as Binance, OKX and Bybit.

In a bid to bring more activity to onshore platforms, Vietnam launched a five-year crypto pilot in September 2025, requiring all transactions to be conducted in Vietnamese dong through locally registered companies.

Magazine: Guide to the top and emerging global crypto hubs: Mid-2026

Parliamentary standards watchdog formally launched a probe into Nigel Farage over an undeclared £5M gift tied to crypto donations.

The investigation centers on a £5 million payment Farage received from Christopher Harborne in early 2024, weeks before he reversed a public decision and announced his candidacy for the Clacton seat.

Harborne, who holds a 12% stake in stablecoin issuer Tether, has separately donated over £22 million to Reform UK since the party’s founding, a total that makes him arguably the largest single financial backer of any British political party in recent memory.

Farage has maintained the £5 million was a personal gift intended to cover lifetime security costs, citing a firebomb attack on his home, and that it falls under an exemption from disclosure rules. Reform UK described the payment as “unconditional and irrevocable.” Both the Conservative and Labour parties rejected the exemption argument and referred the matter to Commissioner Greenberg, who has now formally opened a full inquiry.

The ban that changed British political finance

The probe arrives seven weeks after Prime Minister Keir Starmer announced a moratorium on political crypto donations, effective March 25, 2026. The measure followed the Rycroft Review’s conclusion that digital assets posed a unique risk for foreign interference, given the difficulty in tracing the origin of funds across pseudonymous blockchain transactions. The ban is being written into the Representation of the People Bill with criminal penalties for non-compliance once enacted.

BitMEX co-founder Ben Delo separately disclosed donating approximately £4 million to Reform UK since the start of 2026. Reform was the first Westminster party to accept crypto, a policy Farage announced at the Bitcoin 2025 conference in Las Vegas.

If Greenberg finds a breach, sanctions range from a formal apology to suspension from the Commons, potentially triggering a by-election in Clacton. A YouGov poll this week put Reform UK at 28% of voting intentions, ahead of both Labour and the Conservatives.

April brought a subtle retreat in Polymarket’s monthly trading activity, marking the first month-over-month decline since August as competition within the prediction-market space intensifies. Combined volume on Polymarket and its US trading app surpassed $10.2 billion in April, slipping from more than $11.2 billion in March, according to Dune Analytics data.

In contrast, Kalshi published a stronger showing for the month, with trading volume climbing roughly 13% to about $14.8 billion. Overall, the broader prediction-market sector moved higher, with total monthly volume reaching about $29.8 billion in April from around $26.5 billion in March — an increase of roughly 12.4%.

The shift occurs as Polymarket continues its bid to reintegrate US users amid heightened regulatory scrutiny that followed the sector’s rapid growth during the 2024 elections. At the same time, an array of new entrants is reshaping the landscape for event-based markets.

Last week, Prophet, an AI-native prediction market, launched its first live trading tranche, introducing an AI model that acts as the counterparty using real capital. Separately, MoonPay unveiled an AI-powered tool to assist traders with strategies on prediction markets, signaling a broader push toward AI-assisted decision-making in this space.

Related context: Dutch users still access prediction markets despite Polymarket’s US restrictions, underscoring how different regulatory regimes shape participation across regions.

Polymarket eyes US expansion as prediction markets face heightened scrutiny

Polymarket has been pursuing a path back into the US market after exiting in 2022 as part of a settlement with the US Commodity Futures Trading Commission (CFTC), which barred the platform from serving US residents on its main global exchange. To regain a foothold, Polymarket rolled out a dedicated US app in December 2025, a stand-alone product that operates separately from the main platform and its liquidity pool.

Still, the platform and the broader sector are under intensifying regulatory glare. Senior lawmakers and enforcement officials have raised concerns about insider trading in prediction markets, particularly on geopolitically sensitive topics such as war and energy prices. Earlier this year, lawmakers urged the CFTC to curb potential insider trading and to ensure federal restrictions apply to government insiders engaging with prediction-market platforms.

In parallel, state authorities have begun to push back against prediction-market operators. Wisconsin Attorney General Josh Kaul filed lawsuits in April against Kalshi, Polymarket, and other prediction-market platforms, alleging violations of state sports-betting laws. The evolving legal landscape suggests a continued tension between innovative market formats and compliance requirements across jurisdictions.

The regulatory narrative matters for investors and users because it influences who can participate, how much liquidity flows, and which platforms can sustain long-term growth. For Polymarket, the path forward hinges on clarifying US access while maintaining liquidity and trust with a global user base.

AI-enabled rivals and the reshaping of the prediction-market map

The April volume data illustrate a more contested market where incumbents and newcomers alike vie for share. Kalshi’s surge highlights how a platform with established regulatory compliance frameworks continues to attract substantial activity, even as others experiment with AI-driven models and new business lines.

Prophet’s live-trading tranche represents a notable development: an AI model stepping into the counterparty role could alter risk dynamics, pricing efficiency, and user trust if it scales and proves robust in various event types. MoonPay’s AI tooling signals a broader fintech push into strategy automation, potentially lowering barriers to entry for non-professional traders and expanding participation.

As the sector experiments with AI-driven participation and more sophisticated counterparty models, the relative appeal of human-only versus AI-assisted decision-making remains a live question for traders. For Polymarket and similar platforms, the challenge is balancing innovation with regulatory compliance and ensuring that liquidity remains robust enough to support meaningful markets across a broader set of events.

A broader takeaway for readers is that the trajectory of prediction markets now hinges not only on appetite for event-risk betting but also on how policymakers, regulators, and market participants negotiate insider trading safeguards, cross-border access, and platform accountability. The signals from April suggest continued growth in overall activity, but with a more complex regulatory and competitive backdrop that could shape which platforms emerge as durable players in the next cycle.

What to watch next: whether Polymarket’s US-enabled offering can regain traction amid ongoing scrutiny, how AI-native entrants perform at scale, and which regulatory actions—if any—reshape the permissible contours of prediction-market activity in the United States and abroad. The evolving policy environment and the competitive dynamic between traditional and AI-enhanced platforms will likely define the pace and direction of adoption in the months ahead.

Data and context: the April activity figures and the broader market movements come from Dune Analytics data, with citations to related coverage on regulatory developments and platform updates referenced in the article.

References and further reading:

AI Layer-2 token Matchain MAT surged 349% in a single session as speculative capital rotated into small-cap altcoins.

Matchain is an AI-powered zk-rollup blockchain built on BNB Chain that focuses on decentralised identity, data sovereignty, and performance-based advertising. Its native token MAT is used for gas fees, staking, governance, and access to its MatchID decentralised identity layer.

The project reports over 27 million wallets created and holds a partnership with Paris Saint-Germain targeting mainstream Web3 onboarding.

The 349% move, reported across crypto market data platforms on May 13, occurred as Bitcoin consolidated in the $79,000 to $82,000 range. Matchain carries a market cap of well under $3 million, meaning large percentage moves can occur on thin volume and reverse equally fast.

The token launched on Binance Alpha in June 2025 at an all-time high of $6.67 before falling over 99% to a low of $0.036 in March 2026.

CryptoQuant bull signal adds context to the rotation

The session came one day after CryptoQuant’s Bull-Bear Market Cycle Indicator flipped bullish on May 12 for the first time since March 2023. That prior reading preceded a sustained run taking Bitcoin from $20,000 to above $73,000.

Analysts note that sharp small-cap moves typically occur in the early stages of broader speculative altcoin rotation, when retail capital begins hunting for exposure below the top 20 tokens.

As crypto.news documented, Bitcoin’s dominance has remained elevated above 59% through 2026, with genuine altcoin season historically requiring it to fall below 45%.

The Altcoin Season Index sits at 35 in May 2026, still well short of the 75-point threshold associated with a full market-wide rotation. Capital flows this year have remained heavily concentrated in large-cap names.

Traders should approach assets in this market-cap range with significant caution. Percentage gains of this size in illiquid tokens frequently reverse within hours, and Matchain’s prior price history includes a 99% decline from its listing high in less than a year.