Prediction markets are becoming one of the most active onchain applications, with retail users driving most activity even as participation across much of the broader digital asset market remains subdued.

According to a new report by Bitget Wallet and Polymarket, monthly trading volume reached $25.7 billion in March, with more than 80% of users classified as retail, defined as those trading less than $10,000.

The figures are broadly consistent with data from Dune Analytics, which recorded $23.7 billion in March trading volume, up from $1.9 billion a year earlier.

The report points to a broader behavioral shift in how prediction markets are used. Rather than focusing on one-off, high-profile events, users are returning more frequently and engaging across multiple categories. Average active days per user almost quadrupled from 2.5 to 9.9 over the first quarter, indicating deeper and more consistent participation.

Sports emerged as the largest segment, generating $10.1 billion in trading volume during the quarter, driven by a steady availability of global sporting events. Political markets also saw significant activity, totaling $5 billion over the same period.

The findings suggest prediction markets are evolving beyond episodic betting into a more continuous system for tracking real-world developments, with crypto wallets increasingly serving as key access points for users.

Trading volumes across various prediction markets. Source: Bitget Wallet

Polymarket, one of the largest platforms in the sector, operates on Polygon, allowing users to place onchain bets on real-world outcomes without intermediaries. By contrast, platforms such as Kalshi operate centralized marketplaces.

Related: Polymarket odds of Hormuz Strait traffic normalizing by end of May spike to 73%

Prediction market activity continues to grow

Industry projections cited in the report suggest prediction market volumes could reach $240 billion annually this year, with longer-term forecasts pointing toward the trillion-dollar mark.

That trajectory no longer seems far-fetched. Prediction markets have seen significant momentum since the 2024 US presidential election, benefiting early movers such as Polymarket and Kalshi. Both platforms are reportedly raising substantial capital at valuations exceeding $20 billion.

For Polymarket, evolving regulatory dynamics, particularly growing acceptance from the US Commodity Futures Trading Commission, have enabled more proactive steps around market integrity and transparency. The platform recently updated its governance framework to address risks related to insider trading and market manipulation.

Sports, crypto and politics remain high-volume event categories on Polymarket. Source: Bitget Wallet

Magazine: Are DeFi devs liable for the illegal activity of others on their platforms?

Cointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.

Hong Kong regulators have warned investors about counterfeit stablecoins circulating under the names of newly approved issuers, even as the city prepares for its first regulated launches.

Scammers have begun promoting fake tokens linked to HSBC and Anchorpoint Financial, the two firms recently granted stablecoin licenses in the region. The activity comes before either company has released an official product.

The Hong Kong Monetary Authority (HKMA), along with both firms, issued alerts on Tuesday after tokens using the tickers “HKDAP” and “HSBC” appeared in the market without authorization.

“As of this moment, both licensed stablecoin issuers have confirmed that they have not issued any regulated stablecoins in the market,” the HKMA said.

Hong Kong rolled out its stablecoin licensing framework in August 2025, with the first approvals granted last month. HSBC and Anchorpoint Financial were selected as the initial participants under the regime, following a vetting process that included reserve requirements and compliance checks.

HSBC, Anchorpoint reiterate launch timelines amid scams

In a statement, HSBC said it “has not yet issued any stablecoins in Hong Kong,” noting that its planned Hong Kong dollar-pegged token will be introduced through PayMe and the HSBC HK Mobile App in the second half of 2026.

Anchorpoint Financial gave a similar clarification, stating that it has not launched any tokens under the HKDAP ticker since receiving its license on April 10. “Anchorpoint would like to remind the public to verify information through official sources and use only regulated channels when acquiring or using stablecoins,” the firm said.

Anchorpoint operates as a joint venture backed by Standard Chartered, Animoca Brands, and Hong Kong Telecommunications, positioning it among the early institutional entrants into Hong Kong’s regulated digital asset market.

Oversight and enforcement standards

Under Hong Kong’s licensing regime, issuers of fiat-referenced stablecoins must obtain approval from the HKMA and meet strict requirements on reserve backing, redemption guarantees, governance standards, and Anti-Money Laundering compliance.

The framework also grants the regulator authority to investigate misconduct and take enforcement action, including imposing fines, suspending operations, or revoking licenses if firms fail to meet regulatory obligations.

The rollout follows earlier delays in the approval process. HKMA Chief Executive Eddie Yue had previously indicated that only a “very small number of issuers” would be licensed in the initial phase.

The eventual approval of HSBC and Anchorpoint has now set the stage for Hong Kong’s first regulated stablecoin launches, even as authorities move to curb fraudulent activity in the market.

Network News

MYTHOS CHALLENGES CRYPTO SECURITY: Mythos, the new AI model from Anthropic that has sparked fear and confusion in traditional tech and finance, is also driving a massive shift in how the crypto industry thinks about security. For years, decentralized finance has focused its defenses on smart contracts. Code is audited, vulnerabilities are cataloged, and many common exploits are well understood. But Mythos, a model designed to identify and chain together weaknesses across systems, is pushing attention beyond code and into the infrastructure that supports it. “The bigger risks sit in infrastructure,” said Paul Vijender, head of security at Gauntlet, a risk management firm. “When I think about AI-driven threats, I’m less concerned about smart contract exploits and more focused on AI-assisted attacks against the human and infrastructure layers.” That includes key management systems, signing services, bridges, oracle networks and the cryptographic layers that connect them. These components are less visible than smart contracts and are often outside the scope of traditional audit. In fact, this month, web infrastructure provider Vercel, used by many crypto companies, disclosed a security breach that may have exposed customer API keys, prompting crypto projects to rotate credentials and review their code. Vercel traced the intrusion to a compromised Google Workspace connection via the third-party AI tool Context.ai, which an employee used. Mythos belongs to a new class of AI systems built to simulate adversaries. Instead of scanning for known bugs, it explores how protocols interact, testing how small weaknesses can be combined into real-world exploits. That approach has drawn attention beyond crypto. Banks like JP Morgan are increasingly treating AI-driven cyber risk as systemic and are exploring tools like Mythos for stress testing. Earlier this month, Coinbase and Binance both reportedly approached Anthropic to test Mythos. Early findings from models like Mythos have identified weaknesses in the behind-the-scenes systems that keep crypto platforms secure, including the technology that protects keys and handles communication between systems. — Margaux Nijkerk Read more.

AAVE’S $300M RECOVERY EFFORT: In the often-fractured world of decentralized finance, crises tend to expose fault lines. This time, they’re also revealing an unusual level of coordination. Aave, one of DeFi’s largest lending protocols, is at the center of a broad recovery effort following losses tied to the Kelp DAO exploit, drawing in capital and credit commitments from across the industry. The effort, informally dubbed “DeFi United,” had raised about $301 million in commitments as of Monday, according to its website, with much of the capital still pending governance approval. The exploit, which rippled into rsETH markets and created risk across lending positions on Aave, has prompted what is shaping up to be one of the most coordinated industry responses to a DeFi incident. “There’s a shared priority around supporting users and restoring normal market conditions,” an Aave Labs spokesperson told CoinDesk. “Many of these participants are deeply connected to DeFi, whether through infrastructure, capital, or user access, and have a direct interest in ensuring markets function as expected.” At the core of the effort is Aave itself. A governance proposal outlines a plan for the DAO to allocate up to 250,000 ETH as part of the recovery. Founder Stani Kulechov separately indicated he would donate 5,000 ETH personally. Other contributors within Aave’s orbit are also stepping in, including Aave’s Emilio Frangella (500 ETH), BGD Labs’ Ernesto Boado (100 ETH), BGD Labs (250 ETH) and KPK’s Marcelo Ruiz de Orlano (100 ETH). The response has quickly extended beyond Aave, and in some cases began with direct outreach. Following the April 18 bridge hack, Kulechov reached out to Consensys and other ecosystem participants early to help coordinate a response, according to a Consensys spokesperson. The firm, alongside its founder Joseph Lubin, agreed to commit up to 30,000 ETH in financial support to help advance the recovery and protect users. Sharplink played a strategic advisory role in those discussions, the spokesperson said. — Margaux Nijkerk Read more.

CRYPTO IS FOR AI AGENTS, SAYS ALCHEMY CEO: The modern financial system was never designed for machines. It was built around the constraints of human life: geography, sleep cycles, paperwork and physical presence. But as AI agents begin to act as economic participants, that human-centric design is starting to look less like a feature and more like a bottleneck, said the co-founder of crypto firm Alchemy. “You can argue that crypto was built for AI agents, not humans,” said Nikil Viswanathan, who is also CEO. The mismatch is everywhere. Banks have operating hours because humans do. Payments are tied to countries because people live in them. Credit cards assume physical identity and presence, he said. AI agents operate differently. They don’t sleep. They don’t live anywhere. They don’t walk into banks or carry cards. And increasingly, they don’t just assist with tasks, they transact. “All transactions for agents are online. They’re inherently global,” Viswanathan, who will be speaking at Consensus Miami next month, told CoinDesk in an interview. That’s where crypto starts to look less like an alternative financial system and more like the native infrastructure for a new kind of economic actor, he said. Traditional finance assumes friction. Paying someone in another country involves currency exchanges, intermediaries, delays, fees. For humans, that’s normal; for AI agents, it’s unusable. Agents need to transact seamlessly across borders, at any time, often in tiny increments. They need programmability, direct control over money via code and systems that don’t depend on physical infrastructure or identity. Crypto offers exactly that: a global, always-on financial layer where value moves as easily as data, he said. “Crypto is the global infrastructure for money that agents need,” Viswanathan said. — Will Canny Read more.

BITCOIN PROPOSAL FOR SATOSHI-LINKED TOKENS: Paul Sztorc is not trying to move Satoshi Nakamoto’s bitcoin. That narrow fact is getting lost in the backlash around eCash, a proposed Bitcoin fork scheduled for August at block height 964,000. The new chain would copy Bitcoin’s history up to that point, giving BTC holders an equivalent balance on the forked network. Hold 4.19 BTC, get 4.19 eCash.This would follow the standard fork playbook. Bitcoin Cash did it in 2017, and Bitcoin SV followed later. Both copied Bitcoin’s ledger and changed the rules in the hope the market would care. eCash is different because of what it plans to do with Satoshi’s copied coins. The roughly 1.1 million BTC attributed to Bitcoin’s pseudonymous creator Satoshi Nakamoto sits in dormant addresses often linked to the Patoshi pattern, an early mining fingerprint widely believed to trace back to Satoshi, though never conclusively proven. On a normal one-to-one fork, those addresses would receive roughly 1.1 million eCash. Sztorc’s plan would allocate 600,000 eCash to those addresses and redirect the remaining 500,000 eCash to investors who fund the project before launch. Sztorc, CEO of LayerTwo Labs, pushed back on the theft framing in a Monday X post. “We do not take any of Satoshi’s BTC,” he wrote. “BTC balances are untouched by eCash. To move BTC, you always need BTC software and the BTC private key. We lack both.” But Satoshi’s untouched holdings function as Bitcoin’s foundational guarantee, the proof that even the network’s creator never moved his coins because the rules apply to everyone equally. Selling claims on a forked-chain version of those holdings to fund a new project is the part that reads as theft, even when no theft is technically occurring. That turns the dispute into a property-rights fight, even if the property exists only on a new chain. — Shaurya Malwa Read more.

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In Other News

• BlackRock-backed Securitize and Computershare are bringing parts of the $70 trillion U.S. stock market onchain via tokenized equities in a move that pushes traditional Wall Street infrastructure closer to blockchain rails. The agreement allows listed firms to add tokenized equity — called Issuer-Sponsored Tokens (ISTs) — alongside existing shares, giving investors the option to hold stock through traditional systems or in a digital wallet. The effort is part of a broader push to make tokenized shares work within current market rules while offering new ways to hold and move assets, from wallet-based ownership to faster settlement. Transfer agents like Computershare sit at the center of the system, maintaining shareholder records and handling corporate actions. By integrating at that layer, the companies aim to avoid a common crypto workaround, in which tokens represent claims on shares rather than the shares themselves. Under the setup, Computershare will act as transfer agent for tokenized shares just as it does for traditional ones. That includes managing records and processing events like dividend payments and stock splits across both formats. Securitize provides the underlying technology, but like other recent efforts in the space, the blockchain component sits mostly in the background. The tokens are designed to represent direct ownership, not derivatives layered on top of existing stock. — Kristzian Sandor Read more.
• Crypto payments firm MoonPay acquired Sodot, an Israeli crypto security startup, as part of its plan for MoonPay Institutional, a new unit built for large financial institutions looking to access crypto. Bloomberg reports, citing sources familiar with the acquisition, that it’s an all-stock deal worth about $100 million. The new unit will offer tools for trading, tokenized securities, payments, wallet management and stablecoin issuance. Sodot’s technology will serve as the key management layer for the business. MoonPay Institutional will be led by Caroline D. Pham, who joined MoonPay in December as chief legal officer and chief administrative officer after serving as acting chair of the Commodity Futures Trading Commission last year. Sodot’s self-hosted multi-party computation (MPC) infrastructure is built for institutions that need tighter control over how assets move, who can approve transfers and how automated systems handle transactions.— Francesco Rodrigues Read more.

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Regulatory and Policy

• Hong Kong’s central bank warned that counterfeit tokens are already exploiting the city’s stablecoin regime, even before a single licensed product has been introduced. In a statement, the Hong Kong Monetary Authority (HKMA) said tokens using the tickers “HKDAP” and “HSBC” are circulating in the market, but have no connection to any authorized issuer. Both licensed stablecoin applicants referenced in related press materials confirmed they have not issued any regulated stablecoins, it said. Earlier this month, the HKMA granted its first stablecoin licenses under the Stablecoins Ordinance, which took effect in August 2025, selecting two groups from a pool of 36 applicants. The choice of HSBC and a Standard Chartered-led entity mirrors Hong Kong’s existing monetary system, where a small group of commercial banks is authorized to issue banknotes. The HKMA urged the public to “stay vigilant against fraudulent activities,” advising users to rely only on official communications from licensees and to transact through regulated channels. Insiders say they expect a launch during Hong Kong’s fintech week in November. — Sam Reynolds Read more.
• Israel’s Capital Market Authority granted approval for a stablecoin pegged to the shekel for the first time. Tel Aviv-based cryptocurrency exchange Bits of Gold received authorization to issue the token after a two-year evaluation and pilot process, the authority said in a post on LinkedIn. The token, BILS, was developed in collaboration with the Solana network and crypto custodian heavyweights Fireblocks, with auditing oversight provided by Big Four consultancy firm EY, Bits of Gold said in an emailed statement. The size of the stablecoin sector — crypto tokens pegged to the value of a traditional financial asset, usually a fiat currency — has surged in the last 18 months to more than $300 billion fueled by the establishment of formal regulatory regimes in major markets such as the U.S. The overwhelming dominance of U.S. dollar-pegged tokens in the sector has prompted concerns in markets outside the U.S. about the threat of losing financial and digital sovereignty if onchain payments all default to dollars as their unit of account. — Jamie Crawley Read more.

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Calendar

• May 5-7, 2026: Consensus, Miami
• June 2-3, 2026: Proof of Talk, Paris
• June 8-10, 2026: ETHConf, New York
• Sept. 29-Oct.1, 2026: Korea Blockchain Week, Seoul
• Oct. 7-8, 2026: Token2049, Singapore
• Nov. 3-6, 2026: Devcon, Mumbai
• Nov. 15-17, 2026: Solana Breakpoint, London

Crypto payments platform MoonPay is launching an institutional unit after acquiring Sodot, an Israeli crypto security infrastructure provider.

MoonPay on Wednesday announced the acquisition of Sodot, using Sodot’s key management technology as the core infrastructure layer of its new business serving financial institutions, asset managers, trading firms and exchanges entering digital asset markets.

“We built MoonPay to be the world’s leading crypto payments network,” MoonPay co-founder and CEO Ivan Soto-Wright said in a press release, adding that its institutional arm is the next stage for the company.

According to Bloomberg, the deal closed in April in an all-stock transaction valued at around $100 million. MoonPay did not immediately respond to Cointelegraph’s request for comment to confirm the deal’s details.

The move expands MoonPay’s business beyond retail crypto payments and reflects rising demand from traditional finance companies for secure wallet and custody infrastructure as they expand into digital assets.

MoonPay targets institutional demand

MoonPay’s new institutional division aims to serve large traditional financial firms across a range of areas, including trading, tokenized securities, payments, wallet management and stablecoin issuance.

The unit will be led by Caroline Pham, who joined MoonPay as its chief legal officer and chief administrative officer in December after serving as acting chair of the US Commodity Futures Trading Commission before joining MoonPay in late 2025.

Source: MoonPay

“There is no one better suited to lead this business than Caroline, who brings decades of experience at the highest levels of financial regulation and capital markets,” Soto-Wright said.

Security race heats up in crypto

Founded in 2023, Sodot is a platform focused on crypto key management infrastructure, a critical part of safeguarding digital assets and operating institutional wallets.

The company specializes in self-hosted multi-party computation (MPC), a cryptographic method that splits a private key into separate shares distributed across multiple independent parties to increase the security of funds.

Related: Fireblocks launches tool for institutions to earn yield on stablecoins

The acquisition comes amid a growing trend of institutional services supported by crypto custody providers. Last week, crypto exchange OKX integrated off-exchange settlement by BitGo, a publicly traded digital asset custodian.

Previously, BitMEX partnered with European crypto custody firm Zodia Custody to enable institutional crypto derivatives trading, with collateral held in segregated custody off-exchange.

Magazine: Adam Back says current demand is ‘almost’ enough to send Bitcoin to $1M

Cointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.

Latest developments: ETF inflows are signaling renewed confidence from traditional investors.

• Spot Bitcoin ETFs have absorbed almost $2 billion year-to-date, 21Shares CIO Adrian Fritz said on CoinDesk’s Public Keys
• Demand is coming from a mix of retail investors, institutions, and hedge funds using arbitrage and options strategies
• Morgan Stanley and other major asset managers entering crypto are accelerating institutional adoption

Why it matters: Liquidity — long a concern for skeptics — is no longer a barrier.

• Bitcoin now rivals mega-cap equities like Nvidia, with daily trading volumes exceeding $50 billion, Fritz said
• ETF structures provide both primary and secondary market liquidity, making the asset “institutional ready”
• Portfolio managers are increasingly viewing bitcoin as a viable multi-asset allocation despite volatility concerns

Reading between the lines: The ETF boom didn’t happen overnight.

• Adoption has been gradual, requiring education and comfort with crypto’s role in portfolios
• Investors are still grappling with correlations, volatility, and macro sensitivity
• The steady build in flows suggests a structural — not speculative — shift in demand

What to watch: Several catalysts could push Bitcoin past the key $80K level.

• Improving geopolitical sentiment, including any resolution tied to global conflicts, could boost risk appetite
• Continued ETF inflows remain a core driver of structural demand
• Negative perpetual futures funding rates could trigger short squeezes on upward price moves
• A breakout above the 200-day moving average ($85K–$90K range) would signal a stronger trend reversal

The big picture: Macro forces still dominate crypto’s trajectory.

• Investors are closely watching PCE inflation data and upcoming Fed decisions for policy direction
• Oil prices remain a driver — a spike above $100 could pressure risk assets, including bitcoin
• Adrian expects continued consolidation in the near term, with a move toward $100K by year-end if conditions align

The altcoin angle: Not all crypto assets will benefit equally.

• Ethereum is struggling but showing signs of renewed ETF inflows after a weak first quarter
• “Altcoin season” may not return in its previous form, as investors adopt more fundamentals-driven approaches
• Projects with real revenue and cash flow, like Hyperliquid, are gaining traction with traditional investors
• Weaker altcoin ETFs could face closures if underlying projects fail to demonstrate strength