President Donald Trump submitted a $1.5 trillion defense spending request for fiscal year 2027 on Friday — the largest military budget proposal in U.S. history, a roughly 40% increase over current funding levels, arriving in the fifth week of the U.S.-led war against Iran.

According to Breaking Defense, the $1.5 trillion total is structured in two parts: a $1.15 trillion base budget — the first time the base Pentagon budget has crossed $1 trillion — and $350 billion to be passed through budget reconciliation.

The base budget requests approximately $260 billion for procurement and $220 billion for research, development, testing, and evaluation. The Golden Dome missile defense shield would receive $17.5 billion through reconciliation. The Air Force’s R&D account is slated to rise from $57 billion to $74.2 billion, funding programs including the F-47 stealth fighter scheduled for first flight in 2028. Shipbuilding capital reaches $65.8 billion for 34 vessels.

Budget Director Russell Vought said the plan “builds on the president’s vision by continuing to constrain non-defense spending and reform the federal government.”

Political Backdrop

NPR reports the request arrives as U.S. forces remain engaged in active combat with Iran, burning through Pentagon reserves at an estimated $1.2 billion per week. A separate emergency war supplemental is expected before Congress in late April or May. The Committee for a Responsible Federal Budget estimated the proposal would add $6.9 trillion to the national debt over 10 years, once interest costs are included. Federal Reserve Chair Jerome Powell warned separately that the debt trajectory “will not end well if we don’t do something fairly soon.”

Democratic Senator Patty Murray said she refuses “to provide a blank check to the Pentagon,” adding the department’s challenge is efficient spending, not funding volume. Republicans control both chambers but need to pass the reconciliation vehicle this year — with midterm elections approaching in November.

Market Implications

A budget of this scale, built on deficit spending during active military engagement, adds materially to inflation risk across global markets. As escalating military costs and oil supply disruption from the Iran conflict compress monetary policy options, investors in all asset classes — including digital assets — are recalibrating. The DeFiance CEO warned months ago that Middle East escalation would hit supply chains and financial markets in ways that would ripple broadly. Meanwhile, surveys show that 72% of financial institutions now classify digital assets as essential — a baseline that makes crypto markets increasingly sensitive to the macro signals this budget transmits.

Polymarket removed a market tied to a missing US service member after public criticism and political backlash. 

The platform said the listing failed to meet its integrity standards, adding new pressure on how prediction markets handle sensitive real-world events.

The controversy began after a market appeared asking whether US authorities would confirm the rescue of a pilot reportedly shot down over Iran. Most traders had bet that the person would not be rescued until Saturday, turning the listing into a wider public issue.

Polymarket later said it removed the market immediately. The company said the listing should not have gone live and added that it is now reviewing how the market passed its internal checks. The platform did not explain which specific rule had been broken.

US Representative Seth Moulton criticized the listing and said it should never have been available for trading. In a post on X, he called the market “disgusting” and said people were placing bets on the fate of a potentially injured service member.

“They could be your neighbor, a friend, a family member. And people are betting on whether or not they’ll be saved,” Moulton added.

The criticism drew more attention to the case and placed Polymarket under fresh public scrutiny over how it reviews markets before launch.

Although Polymarket said the market failed its integrity standards, the company did not say which rule applied. That lack of detail led some users and observers to question how the platform defines prohibited markets.

Business Insider correspondent Jack Newsham said he reviewed the platform’s market integrity page and terms of service but could not identify the relevant restriction. He wrote, “I’m looking at the “Market Integrity” page, and I checked the TOS, and I don’t see which prohibition is relevant here.”

Wider pressure on prediction markets

The latest dispute comes as Polymarket faces more attention over its growth and market activity. Reports recently said the platform’s daily fees climbed sharply after a broader fee model took effect across areas such as finance, politics, and technology.

At the same time, concerns about insider trading on prediction markets have continued to grow. Last month, reports said a group of traders made about $1 million by correctly betting on the timing of US strikes on Iran. 

That activity led at least 42 Democratic lawmakers to urge the Commodity Futures Trading Commission and the Office of Government Ethics to warn federal employees against using non-public information to trade on prediction markets.

Defense Secretary Pete Hegseth forced Army Chief of Staff General Randy George into immediate retirement on Thursday — the latest in a pattern of senior military dismissals tied to a deepening conflict between Hegseth and uniformed leaders over diversity-linked promotion decisions.

Pentagon spokesperson Sean Parnell confirmed George’s departure in a statement on X: “General Randy A. George will be retiring from his position as the 41st Chief of Staff of the Army effective immediately. The Department of War is grateful for General George’s decades of service to our nation. We wish him well in his retirement.”

No official reason was given. ABC News confirmed a senior Defense Department official told CBS News: “We are grateful for his service, but it was time for a leadership change in the Army.” Sources told CBS News that Hegseth wants someone in the role who will implement his and President Trump’s vision for the Army. Two other generals were also removed Thursday: General David Hodne, commander of the Army’s Transformation and Training Command, and Major General William Green Jr., the Army’s chief of chaplains.

What Drove It

The New York Times reported that George requested a meeting with Hegseth to discuss blocked promotions — and Hegseth refused to meet. The four officers removed from a promotion list of 29 candidates included two Black officers and two women. Nine U.S. officials familiar with the process told NBC News that Hegseth has blocked or delayed promotions for more than a dozen Black and female senior officers across all four military branches.

“If there are no open allegations or investigations, what was the reason they were removed from the list? They have all deployed and done their jobs, and all are combat-tested,” one official said.

George, a career infantry officer commissioned from West Point in 1988, served combat tours spanning Desert Storm, Iraq, and Afghanistan. Nominated to the Chief of Staff role by President Biden and confirmed in 2023, his term was expected to run through September 2027. He is the latest in a series of Joint Chiefs members removed by Hegseth, following the earlier dismissals of Joint Chiefs Chairman Gen. C.Q. Brown and Chief of Naval Operations Adm. Lisa Franchetti.

Pattern and Response

Democratic Senator Chris Murphy attributed the firings to the Iran conflict: “It’s likely that experienced generals are telling Hegseth his Iran war plans are unworkable, disastrous, and deadly.” The Joint Chiefs paid George a tribute: “Since 1988, General George and his family have consistently answered the nation’s call with honor and dedication.”

Military instability of this kind, during active combat, compounds the geopolitical uncertainty already affecting global markets. Analysts tracking Middle East escalation have consistently flagged its downstream effects on supply chains and financial systems. For context, Ripple’s survey data showed that 72% of financial institutions now view digital assets as essential infrastructure — a measure of how deeply integrated digital markets have become with the macro environment that geopolitical decisions like this one directly shape.

Polymarket has pulled a market tied to the fate of a missing U.S. service member after a wave of backlash, saying the listing violated its integrity standards. The decision comes amid heightened scrutiny of prediction markets that touch on real-world human outcomes and potential military actions.

The controversy centered on a prediction asking whether U.S. authorities would confirm the rescue of a pilot reportedly shot down over Iran, a topic that drew rapid and emotional reaction from users. Signals from the market suggested a majority—more than 60% of bettors—did not expect a rescue by the upcoming Saturday, highlighting how quickly sentiment can polarize around volatile, real-time events.

U.S. Representative Seth Moulton condemned the market as “disgusting,” expressing concerns about people speculating on the fate of a potentially injured service member. “They could be your neighbor, a friend, a family member. And people are betting on whether or not they’ll be saved,” he wrote, underscoring the human dimension behind the bets.

Polymarket stated that it removed the market immediately, adding that it should not have been listed and that the company is reviewing how the listing passed internal safeguards. The platform did not offer further detail about which specific rule or policy was violated.

Key takeaways

• Polymarket deleted a market linked to the fate of a missing U.S. service member after backlash, signaling a potential tightening of internal safeguards for sensitive events.
• Officials and commentators are calling for clearer governance of prediction markets that touch on human safety and military outcomes, amid questions about which rules apply to borderline cases.
• Historical tensions around insider trading concerns persist in prediction markets, with recent reporting suggesting substantial profits from timing bets on geopolitical events and renewed calls from lawmakers for regulator guidance.
• Polymarket’s monetization strategy, including a recent fee overhaul, has intensified scrutiny around the platform’s business model and its alignment with user interests and integrity standards.
• The episode underscores the ongoing friction between innovative risk markets and ethical, regulatory, and operational safeguards—an area likely to attract regulatory attention in the near term.

Polymarket’s misstep and the boundaries of prediction markets

From the outset, the market’s subject—whether authorities would confirm the rescue of a potentially endangered service member—presses into delicate territory. Prediction markets have long drawn scrutiny when they intersect with real-world crises, where outcomes can directly affect real lives. Polymarket’s decision to remove the market suggests a recalibration of what content it deems appropriate for its platform, even as the broader market remains interested in forecasting events that straddle news cycles and human risk.

Users quickly noted the lack of clarity around policy enforcement. As coverage of the incident circulated, questions arose about which specific rule in Polymarket’s “integrity standards” had been breached. Critics argued that without transparent guidance on how safeguards are applied, users are left to guess at the boundaries between legitimate forecasting and ethically fraught betting lines. This kind of ambiguity can erate legitimate concerns about governance and user trust—issues that affect not only participants but potential partners and investors evaluating the long-term viability of decentralized or crypto-native prediction platforms.

Polymarket’s action follows a broader context of scrutiny in the sector. The platform has recently expanded its price feeds and product lines, moving into equities and commodities in collaboration with data providers, a move that coincided with a notable uptick in activity and monetization. In March, the company implemented a revamped fee structure, which Cointelegraph noted propelled daily fees well above prior levels and brought revenue into a higher profile. While monetization is essential for sustainable operation, it can also intensify incentives to broaden markets and attract trading volume, complicating the governance calculus when sensitive topics are on the table.

Insider trading concerns persist in prediction markets

Beyond governance questions, prediction markets remain under the lens for potential insider trading issues. Last month, reporting highlighted a group of traders who reportedly profited by accurately timing bets on U.S. strikes in the Middle East. The betting activity centered on the timing of events that could only be known with public or near-public information, and investigators flagged the pattern as suggestive of informational advantages being exploited through blockchain wallets created specifically to target those events. The episode underscored the tension between fast-moving information markets and safeguards against unfair advantages.

In response to those concerns, lawmakers entered the conversation. At least 42 Democratic lawmakers pressed the U.S. Commodity Futures Trading Commission (CFTC) and the Office of Government Ethics to warn federal employees against using non-public information to trade on prediction markets. The appeal reflects bipartisan interest in establishing guardrails that protect both market integrity and the broader public interest, particularly when markets touch on national security or military actions.

Taken together, these developments illustrate a pivot point for the sector. On the one hand, prediction markets offer a compelling lens on how information and sentiment drive consensus around uncertain events. On the other hand, the same dynamics that make these markets attractive—liquidity, rapid pricing, and the potential for swift monetization—also invite ethical and regulatory scrutiny when real-world stakes are high.

What readers should watch next

The Polymarket episode is likely to reverberate through the ecosystem as platforms reassess which markets to enable and how to articulate rules with greater precision. Investors and participants should monitor whether Polymarket, or comparable platforms, publish more granular guidance on integrity standards and incident-response processes. Regulators may also weigh in with clarifications on permissible subjects, disclosure practices, and anti-insider trading measures for decentralized or crypto-enabled markets.

As markets evolve, expect ongoing debates about balancing openness and innovation with accountability. For traders and builders, the takeaway is clear: clarity and safeguards are becoming as important as the odds themselves, and the next wave of policy and product decisions will likely shape how widely these markets are adopted in mainstream financial ecosystems.

Readers should stay tuned to see how Polymarket and peers adjust their governance models, whether new guardrails emerge from regulatory discussions, and how participants adapt their strategies in response to these evolving standards.

TLDR:

• Binance ETH reserve fell to 3.3M ETH, breaking below both the February and August 2024 historical lows.
  
• Bitcoin reserves on Binance declined from 670,000 BTC in early February to 636,000 BTC by early April 2025.
  
• USDT reserves on Binance grew from $35 billion on March 12 to $38 billion by April 2, reflecting rising dry powder.
  
• USDC balances climbed from $4.6 billion in February to $6.6 billion by April 2, adding to total stablecoin buying power.

Binance ETH reserve has dropped to its lowest level in over a year, falling below key historical lows. At the same time, stablecoin balances on the exchange have been rising steadily.

On-chain data from CryptoQuant shows that these two opposing trends are reshaping the exchange’s liquidity structure.

The shift points to easing sell-side pressure alongside growing buying power among traders holding dollar-denominated assets.

ETH and BTC Reserves Record Notable Declines on Binance

Binance’s Ethereum reserve has fallen to 3.3 million ETH, according to CryptoQuant analyst Amr Taha. This level sits below the February 2024 low of 3.53 million ETH and the August 29, 2024 low of 3.49 million ETH. Breaking below both historical support levels marks a clear downward trend in ETH holdings on the exchange.

Bitcoin reserves on Binance have also moved lower over recent weeks. The BTC balance declined from approximately 670,000 BTC in early February to 636,000 BTC by early April. That drop reflects a similar pattern of reduced crypto asset supply sitting on the exchange.

When fewer coins rest on an exchange, available sell-side supply tends to shrink. This shift often reduces the immediate pressure that sellers can place on spot prices during periods of market activity.

Rising Stablecoin Reserves Point to Growing Buying Power

As crypto reserves declined, stablecoin balances on Binance moved in the opposite direction. USDT reserves grew from $35 billion on March 12 to $38 billion by April 2. USDC reserves also climbed from $4.6 billion in February to $6.6 billion over the same period.

Taha noted in his analysis: “If this trend continues, it could create a more supportive setup for price expansion.” The combined growth in USDT and USDC balances reflects an accumulation of dry powder sitting ready on the exchange.

Stablecoin reserves rising while crypto reserves fall is a well-known market structure among experienced traders. It suggests that capital has rotated out of volatile assets and into dollar-pegged holdings, without leaving the exchange entirely.

Whether buyers begin deploying those stablecoin balances into spot markets remains the key variable to watch in the coming weeks.

Two U.S. military aircraft were shot down in separate incidents during combat operations over Iran on April 3 — an F-15E Strike Eagle and an A-10 Thunderbolt II — with a search-and-rescue operation still ongoing for one missing crew member as Operation Epic Fury approaches its sixth week.

U.S. officials confirmed to CBS News that the F-15E Strike Eagle — a two-seat aircraft flown by a pilot and a weapons systems officer — was shot down by Iranian forces. One crew member was rescued by U.S. forces following a combat search-and-rescue mission. The second crew member, a weapons systems officer, remains missing. Images verified by CNN showed low-flying rescue aircraft conducting operations over Khuzestan Province in central Iran.

A rescue helicopter that extracted the surviving pilot was hit by small arms fire during the operation, wounding crew members on board before landing safely. An A-10 Warthog dispatched as part of the search effort was then struck by Iranian fire, forcing its pilot to eject over the Persian Gulf before recovery.

Iran’s state media posted claims of downing the aircraft and announced a reward for the capture of any “enemy pilot or pilots.” Iran’s Parliament Speaker Mohammad Bagher Ghalibaf mocked the U.S. search effort publicly on X.

A Direct Contradiction

The downing conflicts with statements from President Trump, who said in a prime-time address two days earlier: “They have no anti-aircraft equipment. Their radar is 100% annihilated. We are unstoppable as a military force.” Defense Secretary Pete Hegseth and other officials have repeatedly asserted U.S. air dominance over Iran.

According to Axios, three F-15Es had previously been lost to friendly fire during the conflict. The war has now claimed 13 American lives and wounded 365 service members. Israel separately suspended airstrikes in areas relevant to the ongoing U.S. rescue effort, according to an Israeli official speaking anonymously to the Associated Press.

Economic Pressure

Iran’s response has escalated alongside the aircraft losses. Tehran has imposed what amounts to a toll system on the Strait of Hormuz, a waterway through which approximately 20% of globally traded oil transits. Missile and drone attacks struck oil, gas, and desalination facilities across the Persian Gulf on Friday. The Federal Reserve Bank of Chicago’s Austan Goolsbee told CBS News that the Iran war risks fueling inflation in a way that could prevent the Fed from cutting rates in 2026.

As analysts warned months ago, Middle East escalation carries supply chain and inflationary consequences that reverberate across all risk assets. Institutional capital flows have already shifted in response to the conflict’s progression, with large asset managers repositioning across both traditional and digital markets as geopolitical uncertainty deepens.

Leap Wallet will shut down its products by May 28, ending a crypto wallet project that began in the Terra ecosystem and later expanded to Cosmos and other chains. 

The closure affects its browser extension, mobile apps, web app, exchange tool, and validator service.

Leap said on Friday that it plans to sunset its software suite by May 28. The shutdown covers its browser extension, iOS and Android apps, Leap WebApp, Swapfast exchange platform, and Leap Cosmos Hub Validator.

The team said the decision came after building across multiple networks since 2022. In a post on X, it said, “We started Leap in 2022 to redefine what wallet experiences in crypto mean.” It added that the project later grew across “100+ chains.”

Leap also said the move was difficult for the team. It stated, “This decision was not made lightly,” while adding that it still believes in the long-term future of crypto and the interchain ecosystem.

Leap said noncustodial users will still be able to access their assets after the shutdown. The team explained that users can restore the same wallet address through another wallet by using a recovery phrase or private key.

The FAQ said there is no need to move assets to a new address. It explained, “There is no need to withdraw or send your assets to a new address,” because importing the recovery phrase or private key will restore access to the same address.

The team also issued a separate notice for Cosmos users who delegated ATOM to Leap’s validator. It asked them to redelegate to another validator if they want to keep earning staking rewards.

Project began in Terra ecosystem

Leap launched in late 2021 with a $50,000 grant from Terraform Labs, the now-defunct firm behind TerraUSD. In early 2022, the project raised a $3.2 million seed round co-led by CoinFund and Pantera Capital.

At the start, Leap positioned itself as a wallet focused on Terra, with tools for staking LUNA, trading, and connecting with applications such as Anchor and Mirror. It aimed to offer a wallet experience similar to what MetaMask built for Ethereum and Phantom built for Solana.

After the collapse of Terra in 2022, Leap shifted its focus and expanded into the wider Cosmos ecosystem. That move allowed the project to continue as a multi-chain wallet after its original market changed.

The shutdown now closes that chapter for the wallet. While the apps and related services will go offline, users will still retain control of their assets through standard wallet recovery tools supported by other providers.

TLDR:

• Leap Wallet will sunset all products, including extensions and mobile apps, on May 28, 2026, across iOS and Android.
  
• Users can migrate safely using their recovery phrase, as Leap is non-custodial and assets remain on the blockchain at all times.
  
• ATOM delegators staking with Leap’s Cosmos Hub validator must redelegate early due to network unbonding period delays.
  
• After the May 28 deadline, all installed Leap apps will stop functioning, though fund recovery via recovery phrase remains fully possible.

Leap Wallet has officially announced that it will discontinue all its products on May 28, 2026. The crypto wallet provider has been active since 2022, serving users across more than 100 blockchain networks.

The shutdown covers extensions, mobile apps, and several associated services. Users are advised to begin migrating their assets to other supported wallets ahead of the deadline.

All core wallet functions will remain available until that date to allow a smooth transition.

Products Scheduled for Discontinuation After the May Deadline

The shutdown affects a broad range of products tied to the Leap ecosystem. These include Leap Wallet browser extensions and mobile versions on iOS and Android.

Compass Wallet, the Leap WebApp, and the Swapfast service are also on the list. Leap Cosmos Hub Validator and Leap Cosmos Snaps will be discontinued as well.

The team behind Leap shared the news through an official tweet. They noted the wallet was launched to change what crypto wallet experiences could offer users.

Since launch, it expanded to support over 100 chains across multiple ecosystems. The post also reflected the care and responsibility the team felt toward its user base.

In the announcement tweet, the team wrote that the decision to shut down was not made lightly. They added that they continue to believe in the long-term future of the crypto space.

They also extended appreciation to partners and users who supported the product over the years. The message was direct, measured, and absent of any bitterness or blame.

Until May 28, 2026, all listed products will retain their existing core functionality. Users can still view balances, send tokens, and manage their staking positions.

Exporting recovery phrases and private keys will also remain available throughout this period. No core feature will be removed before the official sunset date arrives.

What Users Must Do Before the Shutdown Date

Users holding assets in Leap Wallet are encouraged to move to another wallet provider. The team recommended Keplr, MetaMask, Phantom, and Rabby as compatible alternatives.

Since Leap is a non-custodial wallet, assets are held on the blockchain and not within the app. This means migration does not require any complex transfer of funds between addresses.

Any user with a recovery phrase can import it directly into another supported wallet. That process will restore all addresses and balances automatically across compatible chains.

No manual transfers are necessary for this to work correctly. Starting early reduces the risk of delays or missed steps before the deadline.

Those who delegated ATOM to Leap’s Cosmos Hub validator must also take a separate action. They need to redelegate to another validator to keep earning staking rewards.

Network unbonding periods can stretch over several days, so acting promptly matters. A detailed migration guide with full instructions is available at leapwallet.io.

After May 28, 2026, all Leap products will stop functioning, including already-installed apps. Users who miss the deadline can still recover their funds using their recovery phrase.

Importing it into any compatible wallet will restore full access to holdings. Migration support remains available at support@leapwallet.io until the shutdown date.

Polymarket removed a market tied to the fate of a missing US service member after mounting backlash, saying the listing violated its “integrity standards.”

The controversy erupted after a prediction market appeared asking whether US authorities would confirm the rescue of a pilot reportedly shot down over Iran, with most users (over 60%) betting that they wouldn’t be rescued until Saturday.

US Representative Seth Moulton condemned the market, calling it “disgusting” and expressing concerns over people speculating on the fate of a potentially injured service member. “They could be your neighbor, a friend, a family member. And people are betting on whether or not they’ll be saved,” Moulton wrote.

In response, Polymarket said it had taken the market down immediately, adding that it should not have been listed and that the company is reviewing how it passed internal safeguards. The platform did not provide further detail on what specific rule had been breached.

Related: Polymarket expands into equities and commodities with Pyth price feeds

Polymarket under scrutiny over rules

While Polymarket said it took the market down because it did not meet its integrity standards, the platform did not specify which rule had been violated, prompting further scrutiny from users.

“I’m looking at the “Market Integrity” page, and I checked the TOS, and I don’t see which prohibition is relevant here,” Jack Newsham, a correspondent on Business Insider’s national desk, wrote on X.

As Cointelegraph reported, Polymarket has seen a sharp rise in fees and revenue after expanding its fee model on March 30, with daily fees jumping from about $363,000 to over $1 million and revenue nearing $1 million at its peak. The increase follows broader taker fees across categories like finance, politics and tech, as the platform ramps up monetization.

Related: Crypto VC Paradigm is developing a prediction market terminal: Fortune

Insider trading concerns rise on prediction markets

There have also been growing concerns about insider trading on prediction markets. Last month, it was reported that a group of traders made about $1 million by correctly betting on the timing of US strikes on Iran, with some placing trades just hours before the attacks. The activity, which involved newly created wallets focused almost entirely on strike-related bets, raised insider trading suspicions.

To address these concerns, at least 42 Democratic lawmakers have urged the US Commodity Futures Trading Commission and the Office of Government Ethics to warn federal employees against using non-public information to trade on prediction markets.

Big Questions: Is China hoarding gold so yuan becomes global reserve instead of USD?