Ethereum layer-2 network Taiko has brought its bridge back online after an exploit on June 21 disrupted withdrawals and movement of funds. The protocol announced on Thursday that users can once again transfer assets to and from the network following completion of the last step in its multi-stage recovery process.

Taiko said it has made affected users whole and that any remaining withdrawal limits are intended as temporary safeguards rather than an ongoing restriction on normal bridge usage. The reopening concluded an 11-day period during which the bridge remained closed while security fixes were implemented and the bridge’s 1:1 backing status was restored.

Key takeaways

• Taiko reopened its bridge after an 11-day outage tied to a June 21 exploit.
• In its recovery update, Taiko said it restored full operations and completed the final stage of a four-step plan.
• The protocol stated affected users have been fully reimbursed, while any remaining withdrawal limits are temporary precautions.
• Taiko previously said the incident involved compromised chain-state verification that allowed forged proofs and unauthorized withdrawals.
• The network has not yet detailed exactly how its 1:1 bridge backing was restored or whether any stolen assets were recovered.

Bridge reopening after a four-stage recovery

On Thursday, Taiko posted that transfers to and from the Taiko network were operational again after users completed the last stage of the protocol’s recovery steps. The announcement framed the reopening as the end of the most disruptive phase of the incident response, when the bridge was paused to prevent further unauthorized movement.

The bridge disruption stemmed from a compromise of the chain-state verification mechanism used by Taiko. According to earlier reporting cited by Cointelegraph, the attacker’s access enabled forged proofs to be accepted, which in turn allowed withdrawals from Taiko’s Ethereum vault.

Taiko said the bridge is now operating with restored backing and that the network had progressed through four stages to address the issue. The project also indicated it had verified that the finalized state of the chain does not include forged checkpoints or attacker-controlled claims that could still be executed.

What went wrong on June 21

The exploit took place on June 21. The core failure, as described in the reporting that accompanied Taiko’s response, was the attacker’s compromise of Taiko’s chain-state verification mechanism. That meant the system could accept proofs that should not have been valid, creating a path for unauthorized withdrawals through the bridge to the underlying Ethereum vault.

Security companies cited in the earlier coverage said the incident may have resulted in up to $1.7 million being taken. The event highlights a recurring risk in cross-chain bridge architectures: when verification assumptions break, attackers can exploit proof-handling logic to move assets away from intended custody rules.

Following the bridge reopening, Taiko’s token briefly rose to around $0.35 before falling back to roughly $0.14. That short-lived move reflected renewed market access to transfers, though the token’s trading range suggests investors remained cautious about the full details of the incident and remediation.

Security fixes, backing restoration, and remaining limits

Taiko had already laid out its recovery plan on Sunday, describing a four-stage approach. The network said it deployed security fixes and then verified the chain’s finalized state to ensure it contained no forged checkpoints or attacker claims. It also stated that the changes were submitted through its security council and reviewed by independent security experts.

After those software and verification steps, Taiko said the system then replenished the bridge so that assets issued on the layer-2 network are backed 1:1 by assets held on Ethereum. With the bridge now reopened, that backing restoration is central to the protocol’s claim that users can transfer funds again without taking on unmanaged bridge risk.

As an extra layer of caution, Taiko introduced conservative withdrawal quotas. The project said these limits are not expected to interfere with normal bridge usage, though it did not specify the quota size or how long the temporary restrictions would remain in effect.

Notably, Taiko has not publicly explained the specific operational steps it used to restore the bridge’s 1:1 backing, nor has it stated whether any of the assets taken during the exploit were recovered. The protocol indicated it would publish a full postmortem describing the incident and its response, which is likely to be a key point of follow-up for users and auditors.

Why this matters for users and the broader DeFi stack

For Taiko users, the bridge is the key interface between the layer-2 environment and Ethereum, so keeping it closed affects everything from liquidity movement to routine redeployments of capital. By reopening the bridge and stating that affected users were made whole, Taiko is attempting to restore user confidence and reduce the operational friction that comes with paused cross-chain movement.

For the wider market, the episode is another reminder that layer-2 bridging continues to concentrate risk around proof verification and custody assumptions. Even when the impact is limited relative to the size of the broader ecosystem, an exploit that forces bridge shutdowns can interrupt DeFi operations and affect how quickly liquidity can be rebalanced across networks.

The decision to implement withdrawal quotas after reopening also signals the trade-off protocols are increasingly making after incidents: restoring functionality while controlling the rate at which funds can exit, giving teams time to monitor systems and confirm that the fixes behave as intended in real-world conditions.

Going forward, the most important items for Taiko users to watch are the promised postmortem—especially any detail on how 1:1 backing was restored and whether recovery occurred—and how long the temporary withdrawal limits remain in place. Those answers will help determine whether the reopening is purely operational restoration or the start of a longer stabilization period for the bridge and surrounding smart contract components.

Private-equity firms IVEST Consumer Partners and Cloverlay have sold the Care Bears brand of plush toys and related rights to Authentic Brands Group.

Authentic Brands, a company focused on entertainment, sports and media, owns intellectual property that generates more than $36 billion in annual retail sales. The Care Bears operation, run under IVEST by Cloudco Entertainment, is on track to exceed $750 million in retail sales by the end of this year.

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OpenAI has explored the idea of granting the U.S. government a 5% equity stake as part of efforts to strengthen ties with the Trump administration and broaden public participation in the benefits of artificial intelligence, the Financial Times reported on Thursday.

The proposal, which remains in the conceptual stage, was reportedly raised by OpenAI CEO Sam Altman during early discussions with U.S. officials, the FT said, citing two people familiar with the talks.

The idea would see leading U.S. AI companies contribute similar shares of equity to a public investment vehicle, drawing inspiration from Alaska’s Permanent Fund, which distributes returns from state investments to residents.

The initiative is intended to address growing political scrutiny of the industry by giving the public a direct financial stake in the sector’s long-term growth. Discussions reportedly involved senior Trump administration officials, including Commerce Secretary Howard Lutnick and Treasury Secretary Scott Bessent, although any such arrangement would likely require Congressional approval.

It’s unclear whether other companies with interests in AI, including Anthropic, Google (GOOG) and Meta (META), would support the proposal, the FT said.

OpenAI, the developer of ChatGPT, declined to comment to the FT. CoinDesk has reached out to OpenAI for further comment.

The San Francisco-based company confidentially filed draft IPO paperwork with the U.S. Securities and Exchange Commission (SEC) in June. The company has since indicated it has not committed to a listing timeline. Recent reports suggest advisers are weighing a delay until 2027.

Key Highlights

• KWM stock declined in pre-market hours following the complete liquidation of 88 BTC to service outstanding debt obligations.
• The entertainment company terminated its Bitcoin treasury strategy in under twelve months.
• Available financing capacity has been reallocated toward artificial intelligence infrastructure investments.
• KWM plans to divest Play Co. subsidiary while pursuing debt reduction initiatives.
• The company faces additional pressure from Nasdaq listing compliance requirements.

Shares of K Wave Media (KWM) experienced declines during pre-market activity following the company’s decision to liquidate its complete Bitcoin holdings and terminate its cryptocurrency treasury initiative. The stock decreased 1.36% to reach $0.1450, building on the prior session’s 1.01% decline that brought shares to $0.1470. This transaction occurred as part of a comprehensive corporate reorganization that reallocates resources toward artificial intelligence infrastructure while reducing liabilities.

K Wave Media Ltd., KWM

Complete liquidation of cryptocurrency treasury holdings

K Wave Media executed the sale of its entire 88 BTC position on May 6, 2026, generating proceeds totaling $64.2 million through the transaction. The company applied these funds to satisfy existing debt obligations, effectively eliminating cryptocurrency assets from its financial statements. Consequently, KWM maintains zero digital currency exposure following a treasury program that lasted fewer than twelve months.

The Nasdaq-listed Korean entertainment enterprise had initially embraced Bitcoin through an ambitious capital raising initiative throughout 2025. The company secured access to $1 billion in financing through two distinct funding arrangements. These consisted of a $500 million Share Purchase Agreement with Anson Funds alongside a $500 million Standby Equity Purchase Agreement with Bitcoin Strategic Reserve.

The original strategic framework allocated 80% of specified net proceeds toward cryptocurrency acquisitions. K Wave Media subsequently purchased 88 BTC during July 2025 to establish its inaugural treasury holdings. Nevertheless, mounting debt pressures combined with evolving capital allocation priorities prompted a complete reversal of this approach.

Share price deteriorates amid strategic transformation

KWM equity experienced significant deterioration following the May announcement regarding its operational pivot. Shares plummeted 24% on the disclosure date as the organization redirected financial resources away from cryptocurrency holdings. Furthermore, continued pre-market weakness demonstrated ongoing investor concerns regarding the restructuring process.

On May 4, K Wave Media disclosed potential reallocation of approximately $485 million in remaining financing availability. Management outlined intentions to pursue AI infrastructure opportunities, encompassing data center facilities, graphics processing unit resources, and strategic acquisitions. Accordingly, the Bitcoin liquidation occurred merely two days following this strategic announcement.

K Wave Media simultaneously initiated divestiture proceedings for Play Co., its primary operating subsidiary. This disposition targets elimination of approximately $48 million in combined debt and liabilities, subject to shareholder authorization. Collectively, these measures transformed KWM from a cryptocurrency treasury narrative into an AI infrastructure restructuring situation.

Financial constraints motivate comprehensive transformation

K Wave Media’s cryptocurrency exit underscores the challenges confronting smaller-capitalization treasury strategies. Larger institutional holders possess capacity to endure extended valuation declines, whereas smaller enterprises encounter more restrictive funding conditions and liquidity constraints. Consequently, balance sheet leverage and capital availability often prove more determinative than cryptocurrency valuations themselves.

The organization has pursued additional restructuring measures throughout June 2026. Management terminated its share purchase arrangement with Solaire while planning retirement of approximately 9.8 million ordinary shares. This quantity represents roughly 13% of total outstanding equity.

K Wave Media received notification from Nasdaq regarding minimum market capitalization requirements on June 18, 2026. Company representatives indicated commitment to achieving compliance standards. Shareholders are scheduled to vote on July 10, 2026, regarding a proposed corporate rebranding to Talivar Technologies.

Bitcoin (BTC) traded above $60,000 during Thursday’s European trading hours as traders priced out the prospect of a Federal Reserve interest rate hike in July.

The so-called dovish repricing occurred after Fed Chair Kevin Warsh said inflation risks have eased.

In currency markets, the Japanese yen strengthened to 161.20 per U.S. dollar from its 40-year low of 162.84. The sudden upswing in the yen during European hours triggered rumors that the Bank of Japan (BOJ) may have intervened to support its weakening currency.While the BOJ recently raised its interest rate to 1%, the move failed to halt the yen’s slide, and understandably so. With U.S. interest rates at 3.5%, the dollar remains attractive to investors.

From a crypto perspective, the yen and bitcoin have developed a strong correlation.

Key Highlights

• Elon Musk rejected a Wall Street Journal story regarding a SpaceX AI smartphone as “utterly false” via social media platform X
• Shares of SPCX declined 7.8% during Wednesday’s trading session after the CEO’s rebuttal
• According to the WSJ piece, the alleged device featured a proprietary operating system, xAI integration, and Qualcomm Snapdragon processors
• SpaceX shares have surrendered the majority of post-IPO momentum and currently trade 2.1% below their listing price
• Wall Street maintains a Moderate Buy consensus on SPCX with a $216.83 mean price objective, suggesting 37.6% potential appreciation

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Shares of SpaceX (SPCX) tumbled 7.8% during Wednesday’s session following Elon Musk’s emphatic rejection of a Wall Street Journal article that alleged the aerospace company had been presenting an AI-enabled smartphone prototype to prospective investors before going public.

Space Exploration Technologies Corp., SPCX

Musk’s rebuttal on X consisted of just two words: “Utterly false.” The CEO offered no additional context or clarification.

According to the WSJ article, which cited anonymous sources with knowledge of the situation, the prototype handset operated on a custom-built operating system, incorporated artificial intelligence capabilities from xAI, and utilized Qualcomm’s Snapdragon chip architecture. The story temporarily boosted QCOM shares before Musk’s denial sent them down 1.55%.

The purported device was characterized as having a more refined design than Apple’s iPhone. The WSJ further indicated that the initiative remained in preliminary development phases and might ultimately be abandoned.

This marks another instance where SpaceX smartphone speculation has surfaced publicly. Reuters published a report in February suggesting SpaceX was investigating a mobile handset that would connect to its Starlink satellite infrastructure. Musk refuted those claims as well.

Months earlier in January, Musk had provided a somewhat ambiguous response, acknowledging that a Starlink-connected phone was “not out of the question at some point” — though he emphasized it would differ substantially from conventional smartphones.

SpaceX’s Expanding AI Ambitions

The smartphone narrative fits within SpaceX’s broader strategic vision. The company has committed billions of dollars toward expansion efforts that extend far beyond rocket manufacturing and Starlink connectivity services. SpaceX is developing AI infrastructure, embedding xAI’s Grok artificial intelligence model throughout its operational framework, and investigating orbital data center concepts.

The overarching objective appears to be establishing SpaceX as a formidable competitor in the artificial intelligence sector — not merely a spaceflight enterprise.

Reuters additionally disclosed that SpaceX is examining possibilities for launching its own mobile telecommunications network, and has entered discussions with Charter Communications regarding utilization of its terrestrial infrastructure for cellular traffic. The company previously established a direct-to-cell partnership with T-Mobile utilizing Starlink technology.

Current Stock Performance

SPCX has experienced challenging trading conditions recently. The equity now trades 2.1% beneath its IPO debut price, having relinquished most of the initial post-listing appreciation.

According to TipRanks data, SPCX maintains a Moderate Buy consensus recommendation derived from four Buy ratings, three Hold ratings, and one Sell rating. The average analyst price objective stands at $216.83, implying 37.6% potential upside from present trading levels.

Qualcomm shares retreated 1.55% in response to the report. Both SpaceX and Qualcomm representatives declined to provide statements to Reuters.

Microsoft introduced its own AI-equipped badge device for enterprise users last month, which also incorporates Qualcomm wearable chip technology — underscoring the increasingly competitive landscape within AI-powered hardware markets.

Ethereum layer-2 blockchain Taiko reopened its bridge and restored full operations after a June exploit drained up to $1.7 million. 

On Thursday, Taiko announced that users could once again move funds to and from the network after completing the final stage of its four-step recovery plan. The project said it had made all affected users whole and that any remaining withdrawal limits are temporary safeguards that do not affect normal usage. 

The reopening ends an 11-day disruption following the implementation of security fixes and the restoration of the bridge’s 1:1 backing.

The exploit occurred on June 21 after an attacker compromised Taiko’s chain-state verification mechanism, allowing forged proofs to be accepted and enabling unauthorized withdrawals from its Ethereum vault. Blockchain security companies said that up to $1.7 million in crypto assets were taken. 

Taiko’s seven-day token chart. Source: CoinGecko

Its token, TAIKO, briefly surged to about $0.35 following the bridge reopening, before retreating to roughly $0.14.

Taiko restores bridge backing before reopening

Taiko outlined its recovery plan on Sunday, saying it would bring the network back through four stages. The project said it had deployed fixes and verified that the chain’s finalized state contained no forged checkpoints or attacker claims that could still be executed. 

According to Taiko, the changes were submitted through its security council and reviewed by independent security experts. The network then replenished the bridge to ensure that assets issued on the network were backed 1:1 by assets held on Ethereum. 

Related: DeFi TVL drops 39% in 2026 amid market downturn and record hack activity

Taiko also introduced conservative withdrawal quotas as an added precaution, saying the limits were not expected to prevent users from carrying out bridge transactions. However, it did not disclose the size of the quotas. 

Taiko has not disclosed how the bridge’s 1:1 backing was restored or whether any of the stolen assets were recovered. The project said it would publish a full postmortem detailing the incident and its response.

Magazine: Japanese pension fund tips 1% in crypto, G7 urges action on NK hackers: Asia Express

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.

OpenAI has reportedly floated a plan to give the US government a 5% equity stake as Washington moves toward tighter oversight of frontier AI models. The proposal, discussed in early talks with the Trump administration, is tied to how the company and other major AI players might share in the economic upside of rapidly expanding AI capabilities, according to the Financial Times, citing people familiar with the matter.

The idea comes as OpenAI prepares for a potential US public listing, having confidentially submitted an S-1 for an initial public offering in the United States. Earlier coverage from Cointelegraph noted that OpenAI is joining Anthropic in preparing for a Wall Street debut this year, while the US government takes a more active role in how advanced models are built, released, and governed.

Key takeaways

• OpenAI reportedly discussed offering the US government a 5% equity stake as AI oversight intensifies in Washington.
• The proposal is framed as a way to share the economic benefits of AI, modeled by OpenAI CEO Sam Altman on Alaska’s Permanent Fund structure.
• It remains unclear whether major US AI firms beyond OpenAI would support contributing equity to a public investment vehicle.
• The discussions arrive alongside reported steps toward voluntary security and access standards for frontier AI models from the White House.

A shareholder-like approach to AI economics

The reported 5% stake would not be a one-off grant or regulatory fee, but an equity position—suggesting a longer-term relationship between AI developers and the public sector. According to the Financial Times, OpenAI raised the concept in early discussions with the Trump administration as the company weighs how it navigates a more demanding political environment ahead of a potential public listing.

OpenAI CEO Sam Altman argued that letting the public hold a financial stake could be the “best” mechanism to ensure Americans share in the economic benefits generated by the AI boom. The report says Altman modeled the proposal on Alaska’s Permanent Fund, which invests oil revenue into stocks and pays dividends to residents—an example often used to illustrate how natural resource earnings can be converted into ongoing public wealth.

How the plan could work—and what’s uncertain

Under the reported framework, several leading US AI companies would contribute a 5% equity stake to a public investment vehicle. While the direction is clear, the details are not: the Financial Times reports it remains unclear whether firms such as Anthropic, Google, or Meta would back the idea.

This uncertainty matters because any equity-based structure depends on broad coordination among market participants—particularly if the goal is to create a stable “public” ownership pool rather than a patchwork of separate deals. If major developers do not participate, the plan could fail to achieve the universal “sharing” effect Altman is aiming for, or it could lead to a narrower arrangement centered on specific companies.

The report also describes Altman as actively engaging in the political conversation beyond standard corporate lobbying. It says he has discussed the idea with President Donald Trump and senior officials including Commerce Secretary Howard Lutnick and Treasury Secretary Scott Bessent, and that he also spoke with Sen. Bernie Sanders, who earlier this year proposed a one-time 50% tax on the stock of the largest AI companies to help fund a nearly $7 trillion sovereign wealth fund for Americans.

For investors and builders watching AI policy, this angle is important: it suggests AI governance may increasingly blend market participation with public ownership models. Even if the exact equity structure changes, the underlying direction—linking national oversight with financial alignment—could shape how companies approach compliance, product timelines, and long-term strategy.

Washington’s shift from regulation to standards

The equity-stake discussion is occurring as the White House moves toward a more operational oversight posture for frontier AI systems. The Financial Times reports that the White House is preparing voluntary standards for frontier models following interventions involving recent systems from OpenAI and Anthropic.

Those standards are expected to be announced as early as next week and would cover security benchmarks, define review timelines, and clarify access rules for the most advanced models—both within the United States and abroad. In practice, that implies the US is seeking to formalize “how” advanced models are handled, not just “whether” they meet broad requirements.

Separately, reporting indicates that the Trump administration requested a staggered rollout of OpenAI’s GPT-5.6 and temporarily imposed export controls on Anthropic’s latest models due to cybersecurity concerns before later lifting the restrictions. Coverage from The Guardian describes these steps as part of a broader pattern of active involvement in model deployment and distribution.

Earlier reporting also highlighted how quickly the policy environment can change for model release and export. Cointelegraph, for example, noted that Anthropic planned to bring back its newest models after the US lifted export controls. That coverage underscores how regulatory or security decisions can directly affect availability.

Potential implications for IPO timing and governance

Because equity proposals intersect with capital markets, the timing of OpenAI’s public listing plans is hard to ignore. A potential IPO changes the internal calculus for any government-related ownership or governance mechanism: it can alter how negotiations are framed, how disclosures are handled, and how investors assess regulatory risk.

The reported talks also highlight a broader tension facing the largest AI firms. On one hand, they are moving toward greater transparency and public-market visibility. On the other, they are operating under a government that appears increasingly willing to intervene directly—whether through standards, access rules, rollout expectations, or export controls.

Cointelegraph reports it reached out to OpenAI for comment on the discussions but had not received a response at the time of publication. Until OpenAI or the administration provides further clarification, the equity-stake concept should be treated as a reported proposal rather than an announced policy.

Still, for market participants, the direction of travel is clear: AI oversight is evolving into something more detailed and more closely tied to how advanced models move through the economy and across borders. If voluntary standards harden into practical gatekeeping—or if equity-based public participation gains traction—AI companies may face a governance reality where policy alignment becomes part of competitive strategy rather than a post-launch compliance step.

Readers should watch next whether the White House’s upcoming voluntary standards are sufficiently specific to guide developers’ release and security processes, and whether any government-aligned ownership concept gains support from other major AI firms beyond OpenAI. Those two threads—standards and financial participation—could determine how quickly policy risk becomes predictable for the sector.