Cointelegraph

Paxos-issued stablecoin Global Dollar (USDG) has launched on Arbitrum as the blockchain joins the Global Dollar Network.
According to an announcement shared with Cointelegraph, USDG is natively issued on Arbitrum One, with integrations across decentralized finance protocols including Fluid, Morpho, GMX and Maple. Kraken will support deposits and withdrawals, while Stargate will enable transfers between Arbitrum and other blockchains.
A proposal submitted to the ArbitrumDAO would make USDG growth a strategic objective and add 100 million ARB to an incentive program to increase adoption. The proposal also calls for deploying Arbitrum treasury assets to support USDG liquidity, while businesses integrating the stablecoin can apply for support from the Arbitrum Foundation.
As a Global Dollar Network partner, Arbitrum will share in rewards generated by USDG activity on the network, with the proceeds directed toward adoption and ecosystem development.
Related: Mantle adds Paxos’ USDG stablecoin, joins Global Dollar Network. Source: DefiLlama
About $4 billion in stablecoins are currently held on Arbitrum, according to the Arbitrum Foundation. USDG, meanwhile, is the seventh-largest stablecoin by market capitalization, with about $3.09 billion in circulation, according to DeFiLlama data. Most of its supply is concentrated on X Layer, Robinhood Chain and Solana.
Arbitrum targets growing tokenization market
The USDG launch comes as Arbitrum expands beyond crypto-native applications and becomes infrastructure for financial platforms bringing traditional assets onchain.
The most prominent example is Robinhood Chain, which launched its public mainnet in July after a public testnet debuted in February. The Ethereum layer-2 network is built using Arbitrum and designed to support tokenized real-world and digital assets, including 24/7 trading, lending markets and perpetual futures exchanges.
Last month, Standard Chartered said Robinhood Chain could signal a shift in Arbitrum’s economics, with the network receiving 10% of net protocol revenue generated by companies building on its infrastructure.
The bank forecast that those economics, combined with growing asset tokenization, could help push ARB to $10 by 2030, roughly 70 times its price at the time. Standard Chartered expects tokenized assets to reach $4 trillion by the end of 2028, with Arbitrum among the potential beneficiaries as more assets move onchain.
Magazine: Stablecoins can drain from banks and nations at lightning speed

Prediction market platform Polymarket is rebuilding its smart contract infrastructure, laying the groundwork for new market features and potential expansion beyond Polygon.
Polymarket began rolling out Protocol V2 on Monday, introducing a new smart contract system designed to support different market types through a single exchange, ​​according to an X post by Rajath Alex, the company’s head of protocol.
The platform is testing the system on a limited number of live markets through Oct. 30, with a tentative Nov. 2 target for switching new markets to V2.
The overhaul replaces infrastructure based on code developed in 2019 that requires additional contracts to support new market types.
New protocol uses pUSD as sole collateral token
Protocol V2 uses Polymarket USD (pUSD) as its sole collateral token, alongside a single contract for position tokens and one exchange supporting different market types.
Introduced as part of an exchange upgrade in April 2026, pUSD is a collateral token backed 1:1 by Circle’s dollar-pegged stablecoin, USDC.
The new protocol is designed to support transferring positions, collateral and market outcome data between blockchains, although Polymarket has not announced when cross-chain functionality will launch or which networks it will support.
Polymarket currently operates its prediction markets on Polygon, an Ethereum scaling network, where pUSD is also issued.
Cointelegraph reached out to Polymarket for details on which blockchains it plans to support and when the expansion could take place.
Upgradeable contracts support new features and oracles
Protocol V2 introduces upgradeable smart contracts, allowing Polymarket to modify contracts through a ”secure governance process,“ reducing the need to deploy additional contracts for new features.
It also introduces OracleAggregator, a system designed to connect to different oracles, including UMA and Chainlink, to determine market outcomes.
Polymarket said the new system underwent audits by blockchain security platforms such as Cantina, Quantstamp and Zellic, as well as formal verification by Certora. The company is offering bug bounty rewards of up to $5 million for critical vulnerabilities.
According to the Protocol V2 migration guide, existing positions will not be converted to V2, and app and website users will not need to take technical steps to migrate, although they may be asked to approve new contracts when trading.
Magazine: Former SEC boss made AI Czar, Bitcoin may hit $600K this cycle: Hodler’s Digest

The Hong Kong government reaffirmed its plans to submit an amendment bill before the end of 2026 to establish licensing regimes for digital asset trading, custody, advisory and management services as part of its broader crypto licensing bill.
Secretary for Financial Services and the Treasury of Hong Kong, Christopher Hui, told a Monday policy briefing that the government will submit an amendment bill “within this year” to establish a broader framework for digital asset activities, according to a statement released by the Hong Kong government.
The secretary said the amendment bill covering the four categories will come in response to the “innovative developments” in financial technology.
In January, Hui revealed that regulators planned to submit a draft proposal related to crypto asset regulation before the end of 2026. He also said that the Hong Kong Monetary Authority (HKMA) had begun processing license applications for stablecoin issuers.
In April, the HKMA granted its first stablecoin issuer licenses to Anchorpoint Financial and the Hongkong and Shanghai Banking Corporation.

Bitcoin (BTC) outflows from largest crypto exchange Binance set multiyear records in late September, new analysis reveals.
Key points:
Binance net Bitcoin outflows passed 23,000 BTC in the fourth week of September, their highest in over three years.
CryptoQuant analysis saw better odds of BTC/USD breaking out of its current range as a result.
Whales increased stablecoin inflows to Binance by 40% since mid-August.
Binance Bitcoin reserves fall by nearly 40,000 BTC since Sept. 20
Data from onchain analytics platform CryptoQuant shows that in the seven days through Sept. 27, Binance’s net outflow reached 23,137 BTC.
On a weekly basis, the total marked Binance’s largest outflow since June 2023, when its BTC balance dropped by 44,942 in a single week. While last month saw merely half this amount, CryptoQuant sees similar conditions sparking both withdrawal runs.
“The more BTC leaves a widely accessible platform like Binance, the stronger the signal that accumulation is taking place. Withdrawing BTC from an exchange is a longer-term investment behavior, and therefore a positive signal,” it wrote in a blog post.
Binance BTC daily, weekly netflows data. Source: CryptoQuant
In June 2023, BTC/USD went from $26,300 to $30,500 in the weekly candle that followed the Binance outflows, seeing new 12-month highs as part of its recovery from the 2022 bear market.
A similar accumulation pattern, CryptoQuant continued, is also reflected in Binance’s reserves dropping by nearly 40,000 BTC since Sept. 20.
“Combined with fading sellers, this accumulation could be enough to push Bitcoin out of this consolidation phase fairly quickly,” it added.
BTC/USD has traded in a range between $82,500 and $87,400 since Sept. 21. As Cointelegraph reported, walls of liquidity on exchanges have dictated low-timeframe price moves during that time, with the 2026 yearly open at $87,570 still overhead as resistance.
Binance whales line up stablecoin capital
Separate data shows that large-volume whale entities have increased the supply of stablecoins to Binance over the past six weeks.
Stablecoin supply on exchanges is considered “dry powder” waiting for deployment into cryptoassets, and increasing balances suggest mounting interest in increasing capital exposure.
CryptoQuant reports that between Aug. 15 and the end of September, whale entities increased their rolling 30-day stablecoin inflows to Binance by 40% — from $21.7 billion to $30.5 billion.
“This change in behavior comes after a long lull, during which their inflows receded from the October peak, when they exceeded $61B,” it commented, referring to crypto markets’ current all-time highs from October 2025.
Bitcoin whale stablecoin inflows to Binance (screenshot). Source: CryptoQuant

Real-world asset tokenization platform Ondo Finance is expanding into private markets with tokenized exposures to an unnamed pre-IPO artificial intelligence company.
The platform introduced Ondo Private Markets, offering tokenized notes whose payouts are linked to the value realized per common share of the referenced company at a qualifying liquidity event. The note provides economic exposure without direct ownership of the company’s shares.
Eligible investors will be able to hold the notes in self-custody wallets or trade them on secondary markets around the clock. Ondo said the first notes are expected to start trading this week, with products tied to companies in robotics, cybersecurity, biotech, infrastructure and other sectors planned to follow.
Ondo Stocks, its platform for tokenized US stocks and exchange-traded funds, has more than $1 billion in total value locked and offers more than 450 tokenized stocks and ETFs, according to the company.
Other platforms have also pushed into private markets. In April, Robinhood’s venture fund invested $75 million in OpenAI common stock to give retail investors exposure through its publicly traded closed-end fund. Citi was reported in June to be launching a blockchain marketplace for private-company shares.

The Solana Foundation announced Tuesday the launch of Solana DvP, an open-source settlement program for financial institutions that aims to cut settlement times.
Solana DvP offers an open-source application programming interface for delivery-versus-payment (DvP) settlement on Solana.
The program aims to cut securities settlement from one to two days to seconds by transferring assets and payment in a single transaction that either completes in full or does not take effect, the Solana Foundation said in a press release. It is designed to offer institutions a reusable alternative to custom smart contracts.
The settlement standard is the type of “foundational infrastructure” that institutional market participants need to “operate at scale without introducing settlement risk and counterparty exposure,” said Rhodel D’Souza, head of markets digital assets at JPMorgan. The bank provided input on institutional settlement practices and requirements during work on Solana DvP.
The announcement adds to efforts to speed up financial settlement using blockchain infrastructure. In June 2025, Chainlink, JPMorgan’s Kinexys and Ondo Finance completed a cross-chain DvP pilot involving Ondo’s tokenized US Treasury fund and payment through Kinexys.
On Monday, Kraken’s parent company, Payward, partnered with Singapore Gulf Bank to enable 24/7 US dollar settlement for select institutional clients in Asia and the Gulf region.

US spot Bitcoin exchange-traded funds (ETFs) shed $89.9 million on Monday, reversing two days of inflows as Bitcoin slipped below $86,000.
Bitcoin ETFs attracted around $293 million over the previous two October trading sessions before Monday’s reversal, with total trading volume reaching $2.18 billion, according to SoSoValue data.
The pullback came a day before the first anniversary of Bitcoin’s $126,080 all-time high on Oct. 6, 2025, with BTC trading at $85,559 at the time of publication, or roughly 32% below its record, according to CoinGecko.
Bitcoin (BTC) price chart over the past year. Source: CoinGecko
Since then, cumulative net inflows into US spot Bitcoin ETFs have fallen 5.8%, from around $61.3 billion to $57.7 billion as of Monday, according to SoSoValue.
US spot Ether (ETH) ETFs also recorded roughly $51 million in net outflows on Monday, extending their losing streak to five consecutive trading days. The funds lost a combined $206 million throughout the streak, with cumulative net inflows standing at $13.8 billion.
Other altcoin ETFs posted mixed results on Monday. Solana (SOL) and Zcash (ZEC) funds recorded net outflows of $9.3 million and $3.6 million, respectively, while XRP ETFs saw no net flows after posting $3.3 million in outflows on Friday.

The Ethereum Economic Zone (EEZ) has tested an atomic transaction between Ethereum mainnet and a layer-2 network, according to a project contributor.
On Tuesday, EEZ contributor Eduardo Antuña Díez shared the transaction and called it the “first atomic cross-chain” L1-to-L2 transaction. The transaction’s logs record a cross-chain call carrying 0.001 Ether (ETH) and a state update for a rollup.
In an atomic transaction, linked actions across networks either all succeed or are all reversed if any part fails.
In March, developers behind the EEZ said the framework was designed to let rollups interact with each other and Ethereum mainnet within a single transaction, without relying on bridges. The project aims to reconnect liquidity and applications spread across separate L2 networks.
Gnosis co-founder Friederike Ernst previously told Cointelegraph that the lack of synchronous composability forces protocols to maintain separate deployments across L2s, fragmenting liquidity into multiple markets.
Jakub Gregus, co-founder of decentralized finance protocol Hydration, called the demonstration “one of the most important milestones” in crypto, saying that the technology could directly benefit Ethereum.

Better Markets says the US derivatives regulator’s push to develop rules for certain retail crypto transactions could leave investors with weaker safeguards, arguing the agency is ill-equipped to oversee the market.
The Commodity Futures Trading Commission on Monday sought public comment on a potential framework for margined, leveraged or financed retail crypto transactions under its existing authority. Benjamin Schiffrin, director of securities policy at Better Markets, a nonprofit financial reform advocacy group, argued that CFTC oversight is less suited than the SEC to protecting retail investors.
“Unlike the SEC, the CFTC lacks an investor protection mandate. Its mission is to regulate the commodity and derivatives markets, which historically have been dominated by large institutions with very little retail investor participation,” said Schiffrin.
“Because the CFTC’s rules lack the protections that apply when investors trade securities regulated by the SEC, the CFTC is the wrong agency to regulate transactions involving crypto assets by retail customers,” he added.
Better Markets’ criticism comes as the CFTC and SEC move ahead with crypto policy under existing law after the CLARITY Act stalled in Congress. Both agencies had previously signaled they were prepared to act without new legislation.
Better Markets questions “crypto capital” goal
Better Markets also challenged the CFTC’s claim that Congress intended the agency to oversee these types of retail crypto transactions.
Schiffrin noted that the statutory authority cited by the CFTC was originally enacted to address fraud in leveraged precious-metals trading, and argued that this did not show an intent for the agency to become a primary regulator for retail crypto.
He also criticized the framework under consideration for potentially allowing affiliations between market participants that Better Markets said contributed to FTX’s collapse.
Schiffrin also took aim at CFTC Chair Mike Selig’s statements about making the US the crypto capital of the world.
“Yet he does not explain why that is a good thing. For example, the US is not the cocaine production capital of the world, and no one is complaining—for good reason,” he said.
“Crypto—after 18 years of effort and innumerable disproved and baseless claims—still lacks any real-world use case. It is used either purely for speculation or for criminal purposes,” he said.
Nate Geraci, president of NovaDius Wealth Management, pushed back on the characterization, saying the crypto industry is simply seeking clear rules of the road and arguing that, if Congress cannot provide them, the CFTC and SEC may have to do so.
CFTC, SEC move ahead after CLARITY setback
The CFTC’s newly proposed crypto framework also considers a new federal category for crypto trading platforms that would bring qualifying exchanges directly under CFTC oversight.
Meanwhile, the SEC has also pushed ahead with several crypto measures. On Thursday, it proposed easing some custody rules for investment advisers, while separately allowing limited tokenized US stock trading and issuing new guidance on how securities laws apply to crypto.
Magazine: Too big to pause: Could an AI slowdown crash the economy?

Stablecoin payments infrastructure provider Rain has filed an application to establish a national trust bank headquartered in New York, adding to a wave of crypto companies seeking bank charters over the last year.
Rain said Monday it filed the application with the Office of the Comptroller of the Currency (OCC) to establish Rain National Trust Bank. If approved, the bank would be able to provide fiduciary custody of digital assets and US dollars for institutional clients, provide reserve management for permitted stablecoin issuers and issue and redeem dollar-backed stablecoins in accordance with the GENIUS Act.
Former Square Financial Services chief financial officer Brandon Soto will serve as president and CEO of the proposed national trust bank, subject to OCC review.
“The institutions building on Rain want the assets behind their programs held by a fiduciary that answers to a federal regulator,” Rain CEO and co-founder Farooq Malik said.
Rain joins a growing number of crypto and payments companies seeking national trust bank charters. Payments infrastructure company Modern Treasury also announced Monday it had submitted an application seeking approval to offer digital asset custody and related fiat services.
Community banks challenge OCC over crypto trust charters
However, the push has drawn opposition from community banks. On Friday, the Independent Community Bankers of America sued the OCC, alleging the regulator exceeded its authority by allowing non-depository trust banks to conduct extensive non-fiduciary activities.
The lawsuit was filed in the US District Court for the District of Columbia against the OCC and Comptroller Jonathan Gould.
The ICBA argued that the OCC’s National Bank Chartering final rule and an interpretive letter 1176, 2021, “perversely allow entities engaged in highly risky cryptocurrency and digital assets activities to enter the banking system under lightly regulated national charters rather than the more rigorously regulated traditional bank charter.”
ICBA said the framework gives crypto trust banks a competitive advantage by allowing them to offer services that overlap with community banks without facing the same regulatory obligations. It also alleged consumers could mistake the “national bank” designation for assurance that their assets are federally insured.
The group has asked the court to overturn OCC’s March 2026 chartering rule and 2021 interpretive letter, and prevent further charter approvals relying on them.
On Monday, Crypto Council for Innovation said the lawsuit was an attempt to stifle innovation.
According to the ICBA’s complaint, the OCC has approved or conditionally approved at least 21 trust banks, with at least 13 of them being crypto companies.
Magazine: Stablecoins can drain from banks and nations at lightning speed

A Chinese organized crime syndicate laundered more than $1 billion stolen in multiple crypto exploits for North Korea’s Lazarus Group, according to blockchain investigator ZachXBT.
In an Oct. 5 thread on X, pseudonymous blockchain investigator ZachXBT said he posed as a paying client to infiltrate the money laundering network in February 2025, just days after the Bybit hack. He put up $349,700 in stablecoins and took a 5% loss on each order to build trust with one of the network’s operators, known as “Jimmy Green.”
ZachXBT said the operations spanned Hong Kong and mainland China, and information supplied by the launderer helped him identify a cluster of more than $12 million in Bybit-linked funds, with Tether later freezing $442,000 in associated USDt (USDT).
The investigation offers rare insight into the alleged intermediaries handling North Korea’s stolen crypto. Hackers linked to the country have stolen at least $6.75 billion in digital assets through 2025, according to Chainalysis.
How North Korea moves stolen crypto
North Korean hackers are known to use a multi-stage laundering process. One method involves chain-hopping and token swapping through decentralized exchanges, bridges and other services to obscure the flow of funds.
Chinese intermediaries have emerged as an important link in that process. In 2020, US prosecutors charged two Chinese nationals with laundering more than $100 million stolen by North Korean hackers from a cryptocurrency exchange in 2018.
Source: ZachXBT
In 2023, the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned two crypto traders, one from Hong Kong and the other from China, for their role in helping the DPRK convert stolen crypto and bypass financial controls.
Chinese actors allegedly laundering Bitget funds
ZachXBT has also linked Chinese actors to the laundering of funds from the $387.5 million Bitget exploit in September.
In a post to X on Sept. 28, ZachXBT said Chinese actors allegedly laundering funds on behalf of the North Korean hackers had been openly seeking support in public Discord servers and Telegram channels operated by services they used. ZachXBT said one of the operators had also been involved in laundering funds from the $292 million Kelp DAO exploit in April.
Magazine: Furious debate about THORChain vs NEAR shows idealism has limits

Fairshake, the political action committee (PAC) backed by contributions from Coinbase, Ripple Labs and Andreessen Horowitz, announced that it would initially spend a combined $6 million on six House of Representatives candidates out of 32 people the group planned to back ahead of the 2026 US midterm elections.
On Monday, Fairshake said that it would support 19 Republican and 13 Democratic incumbents in US House races for 2026. The PAC is expected to spend more than $100 million on ads supporting House and Senate candidates in 2026, including at least $30 million in Ohio’s Senate race to back Republican Jon Husted over Democrat Sherrod Brown.
“Fairshake has always been and always will be an issue-focused organization,” said Fairshake spokesperson Geoff Vetter. “We back pro-crypto candidates who support American innovation in both parties.”
According to the crypto-backed PAC, three Republican and three Democratic candidates will each receive $1 million in spending ahead of the 2026 midterms. These politicians included Oregon Representative Janelle Bynum, California Representative Derek Tran and Nevada Representative Steven Horsford on the Democratic side and Arkansas Representative French Hill, Michigan Representative Bill Huizenga and Wisconsin Representative Bryan Steil as Republicans.
All 32 candidates Fairshake said would receive its support voted to advance the Digital Asset Market Clarity Act, a bill that had been expected to establish clear roles for US financial agencies in overseeing digital assets. The legislation failed to pass a crucial Senate vote, leaving the Republican-led bill’s future uncertain ahead of the midterm elections. Many polls showed Democrats favored to take majority control of both the House and Senate in 2027.
Vetter said in August that Fairshake had “$122 million cash on hand” ahead of the midterms as part of its plan to “help build the largest pro-crypto caucus in American history.” The consumer advocacy group Public Citizen reported that the PAC had spent $82 million on ads opposing or backing candidates as of June, less than half of the $189 million it estimated came from advocacy groups and companies aligned with the crypto industry.

The artificial intelligence industry in the United States has powerful forces pulling it in completely opposite directions.
Top AI industry leaders are jointly calling for a slowdown in the pace of development, while US President Donald Trump wants to go full steam ahead to beat China and has announced a so-called “Super Intelligence Force,” headed up by former SEC boss Jay Clayton.
Meanwhile, the five major US based AI hyperscalers are expected to tip $800 billion into the AI buildout this year according to Goldman Sachs.
With the US stock market and GPD growth increasingly dependent on the health of the AI industry, could a slowdown in the pace of AI development tank the economy?
Who wants a slowdown and who doesn’t?
Anthropic CEO Dario Amodei wants to “pace the frontier,” slowing advances in the most powerful AI models so that safety research can catch up. His September proposal combines independent evaluators inside labs, shared safety standards and limits on developers in democratic countries, and eventual international coordination, with countries including China.
OpenAI’s Sam Altman, Google DeepMind co-founder Demis Hassabis and xAI founder Elon Musk have endorsed his approach. While Amodei explicitly says pacing would allow model training and technical progress to continue, some politicians want to impose a harder brake. Senator Bernie Sanders and Representative Greg Casar’s “Ban Artificial Superintelligence Act”, introduced Sept. 23, would permanently prohibit superintelligence and pause advanced AI development until federal safety rules are established.
Senator Elizabeth Warren also wants an immediate pause. European Commission President Ursula von der Leyen supports pacing frontier AI research.
But President Donald Trump opposes a slowdown, arguing that restrictions would benefit China and warning: “Don’t kill the Golden Goose!” Meta’s Mark Zuckerberg favors each lab determining its own safe pace, citing competition and liability as incentives.
Source: Donald Trump
Nvidia’s Jensen Huang similarly urges rapid development, while explicitly supporting company-specific pauses when products are unsafe or control is uncertain. Their objection is to a coordinated slowdown, rather than every form of restraint.
On Sept. 29, Trump and leading AI executives signed a voluntary safety accord centered on internal controls, independent audits and oversight. The agreement establishes safety commitments without imposing a collective development pause.
But with global anxiety around the technology growing, the next high profile AI safety incident could renew the push toward a slowdown.
Will a slowdown take down large bets?
A huge amount of money is currently pouring into the AI build out. SoftBank launched another $10 billion and €1 billion ($1.15 billion) bond sale recently to fund its OpenAI investment. It would be Asia-Pacific and Japan’s largest non-financial corporate bond deal and among this year’s 20 largest globally, according to Reuters. SoftBank had already invested about $54.6 billion in OpenAI by the end of July.
Data suggests that the pace of AI investment is growing at such a rate, that it is having a significant impact on the broader US economy. A January St. Louis Fed analysis estimated that broad AI-related investment accounted for 39% of real GDP growth during the first nine months of 2025:
“Together, the AI categories contributed 0.97 percentage points to real GDP growth in the first three quarters of 2025 [...] Through the third quarter of 2025, these categories made up 39% (36% excluding data centers) of total GDP growth versus 28% in 2000.”
An AI slowdown would not automatically result in economic disaster in the US — but it would certainly have an impact. It could lead to a change in market expectations, cause companies to cancel infrastructure plans, see investors reprice AI assets and lenders to withdraw financing.
In April the IMF estimated that an AI-investment reversal would bring a 20% decline in US equity markets and tighter credit, with US GDP 1.5% below baseline and world output 1.2% lower. A scenario released this month by major credit rating agency Fitch is even harsher, expecting a 35% equity shock plus capex retrenchment produces a US recession.
The glass half full view
The more optimistic view is that we haven’t even started to tap the full potential of the AI technology that already exists. David Minarsch, the CEO of AI phone agent service Valory and founding member of AI agent system Olas, tells Magazine that slowing frontier AI capability progress would still see gains significant productivity gains made through agentic system development. “There’s ample evidence that AI adoption is severely lagging across many industries and even within software engineering lagging across different types of businesses and organisations,” he explains,
“Even with a complete halt of training new models, the dissemination of existing models through the economy would continue, yielding the associated gains.”
Shiv Shankar, founder and CEO of AI computing platform Boundless, agrees. He tells Magazine that “as people find more and more use cases, at least for the short to medium term, meaning the next couple of years, we only see inference demand going vertical.” That’s regardless of a model development slow down. “It’s going to keep growing, and quite a lot of opportunities may be created,” he concluded.
The glass half empty view
While not talking about the slowdown specifically, the International Monetary Fund (IMF) warned in January that weaker AI-productivity expectations could see reduced investment, trigger a market correction and erode household wealth. Those effects would then echo through the economy by weighing down on consumption and further investment:
“Risks to the outlook remain tilted to the downside. Reevaluation of productivity growth expectations about AI could lead to a decline in investment and trigger an abrupt financial market correction, spreading from AI-linked companies to other segments and eroding household wealth.”
Bank for International Settlements (BIS) administrator Pablo Hernández de Cos explained earlier this month that “should the returns to AI disappoint, a pullback in investment could turn today’s capital expenditure boom into a bust.” He added that history offered some instructive parallels.
“The canal mania of the 1830s, the British railway mania of the 1840s, the electrification boom of the 1920s and the dotcom surge of the late 1990s were all based on important technological breakthroughs. All drew in more capital than eventual returns could justify. In each of these cases, the eventual correction that followed had economy-wide implications.”
A July BIS paper estimated that over investment in AI infrastructure is at roughly 1.5 times the socially efficient level — highlighting debt and circular equity that make a bust and broader economic contagion more likely:
“The AI race generates significant over-investment, exceeding the socially efficient level by around 50% under a conservative baseline. Larger booms end in more disruptive busts.”
The Union Bank of Switzerland argued last week that “pacing does not necessarily imply lower capex” and announced that the bank retains its “2027 AI industry capex forecast of USD $1.2 trillion, a rise of 33% from our estimate of USD $900 billion this year.”
So perhaps a slowdown could potentially alleviate some of this reported over investment? Only time will tell.

The US Treasury’s Financial Crimes Enforcement Network (FinCEN) withdrew two proposed rules affecting its enforcement of crypto companies, including one on “convertible virtual currency mixing.”
According to a Monday notice, the agency will withdraw a December 2020 proposal that would have imposed “recordkeeping, verification, and reporting requirements” related to crypto transactions and unhosted wallets, as well as one affecting enforcement of crypto mixing services. FinCEN said that the mixer rule, initially proposed in October 2023, “could have a chilling effect on legitimate activity and place a large reporting burden on covered financial institutions.”
“FinCEN has considered the comments submitted in response to these proposals and is withdrawing them as part of the Trump Administration’s deregulatory agenda and ongoing efforts to ensure digital asset regulations are fit-for-purpose,” the Monday notice said.
The US agency’s regulatory action is the latest in a series of moves by departments tasked with overseeing crypto assets, citing the Trump administration’s crypto agenda. Earlier today, Commodity Futures Trading Commission Chair Michael Selig announced that the agency was using its “existing statutory authorities“ to propose two rules on how crypto companies could operate under its purview without additional authority from Congress.
Many advocacy groups for the crypto and blockchain industry lauded FinCEN for reversing course on crypto mixers and reporting requirements related to unhosted wallets. In a Monday X post, the Crypto Council for Innovation called the move “positive for the digital asset ecosystem.”

Payments infrastructure company Modern Treasury has applied to establish a US national trust bank that would provide digital asset custody and related fiat services.
According to Monday’s announcement, the company submitted an application to the Office of the Comptroller of the Currency (OCC) to establish Modern Treasury National Trust Bank, which would operate as a federally regulated, limited-purpose national trust bank.
If approved, the bank would allow Modern Treasury customers to custody and move stablecoins and fiat through an integrated service, but would not issue stablecoins or make loans.
“We believe stablecoins are foundational economic infrastructure for the future,” Modern Treasury co-founder and CEO Matt Marcus said, adding that the company has fully integrated stablecoins into its payments platform.
Modern Treasury said the proposed bank would operate separately from its existing payments business, which has facilitated more than $600 billion in payments across hundreds of organizations.
The application comes amid a broader push by crypto and payments companies for national trust bank charters. Bastion and Ripple have received conditional approvals, while Circle and BitGo have received final approvals. Kraken parent Payward, Zerohash and Block have also submitted applications.
Magazine: Former SEC boss made AI Czar, Bitcoin may hit $600K this cycle: Hodler’s Digest

The Crypto Council for Innovation (CCI) has backed the Office of the Comptroller of the Currency’s (OCC’s) move to approve several charters for crypto companies, saying a lawsuit filed by the Independent Community Bankers of America (ICBA) was an attempt to stifle innovation.
On Monday, CCI CEO Ji Hun Kim said that the ICBA lawsuit was a “clear attempt to resist national trust charters, payments innovation, and competition in financial services.” The crypto advocacy organization supported the OCC’s approvals and conditional approvals of crypto companies for national trust charters, despite accusations from some lawmakers that exchanges “want to evade the fundamental safeguards and obligations that come with being a bank.”
The ICBA legal action, filed on Friday in the US District ​Court for the District of Columbia, alleged that the OCC approved US bank charters for entities, including crypto companies, without sufficient safeguards or compliance with requirements normally used for banks.
“Congress did not create the national trust charter as a side door into the banking system for crypto firms seeking the credibility of a federal bank charter without the Community Reinvestment Act obligations, consolidated supervision, capital and liquidity standards, and FDIC insurance that apply to insured depository institutions,” said ICBA president and CEO Rebeca Romero Rainey in a Friday statement.
Among the applications the OCC has approved or conditionally approved under US President Donald Trump were those from World Liberty Financial, Circle, Ripple, Fidelity Digital Assets, BitGo and Paxos.
Many lawmakers criticized the World Liberty approval, which came under the leadership of OCC head Jonathan Gould, a Trump pick who has served since July 2025. Members of the Trump family co-founded the crypto company, which has been the target of probes over alleged ties to the royal families of the United Arab Emirates.

S&P Global Ratings has launched a risk assessment framework for digital asset lending vaults as the onchain investment products gain traction.
According to Monday’s announcement, the framework evaluates vaults across six areas: portfolio credit quality risk, liquidity mismatch risk, curator risk, blockchain risk, protocol risk, and vault security and governance risk.
S&P said the assessments will evaluate the risk of losses to investors in lending vaults, but will not constitute credit ratings or evaluate yields. As well, the framework was not designed to single out any one category of the six that poses a greater risk than the others, according to S&P Global Ratings analyst Lisa Schroeer.
“A material weakness in any factor can constrain the overall VRA,” Schroeer told Cointelegraph. “A strong score in one factor does not offset a material weakness in another.” She said that the approach reflects a sector where “there are many points of risk/failure that can break.”
Digital asset lending vaults pool investor deposits and deploy them through predefined strategies managed by smart contracts or human curators. Depositors receive tokens representing their share of the vault’s assets and returns.
According to S&P, deposits in digital asset lending vaults reached about $10 billion in September, up from $1.5 billion two years earlier. S&P said it plans to publish its first Vault Risk Assessments in future announcements, though it did not identify which vaults will be assessed first.
Explaining the framework’s potential role for investors, Schroeer said: “The assessment aims to provide more transparency on the risks so that any entity can make more informed decisions when deciding how to allocate capital to DeFi vaults.”
Crypto vaults grow as risks draw scrutiny
Crypto vaults have expanded over the past year as exchanges, wallets and DeFi platforms have rolled out products that package lending and other yield-generating strategies for users.
In February, Wallet in Telegram introduced self-custodial BTC, ETH and USDT vaults using infrastructure from Morpho, TAC and Re7. Kraken followed in May with a Bitcoin yield vault powered by Veda and curated by Sentora, attracting $30 million from 4,000 wallets within its first 10 hours.
The model has since expanded into tokenized securities. In September, Kraken launched yield vaults for tokenized versions of Nvidia, the SPDR S&P 500 and Invesco QQQ ETFs, with Sentora managing strategies that lend the assets through DeFi markets.
Source: PeckShieldAlert
The growing popularity of crypto vaults has not come without risks. In August, lending protocol Term Finance lost an estimated $8.5 million after an attacker exploited governance control of its Meta Vaults.
For the time being, crypto vaults remain in a regulatory gray area in the United States. In July, SEC Commissioner Hester Peirce said some vaults and onchain lending products could fall under federal securities laws depending on how they are structured and operated.
Peirce said vaults involving discretionary decisions over asset allocation, yield strategies, lending terms or liquidation thresholds could trigger securities, investment company or investment adviser requirements.
Magazine: Former SEC boss made AI Czar, Bitcoin may hit $600K this cycle: Hodler’s Digest

US Commodity Futures Trading Commission (CFTC) Chair Michael Selig said that the agency will move forward on crypto regulation at the direction of President Donald Trump “with or without legislation” from Congress.
Speaking at the Fordham Law Blockchain Regulatory Symposium on Monday, Selig announced proposals giving crypto companies the option to operate under the CFTC’s umbrella rather than dealing with the patchwork of regulations offered by individual US states.
According to written remarks from the event, the CFTC chair said that it had issued an advanced notice of proposed rulemarking for companies “offering retail customers the ability to trade crypto assets on a margined, leveraged, or financed basis,” calling the regulation ‘CTX.’
Selig said that the agency planned to establish a new category of designated contract market (DCM) called a “crypto asset market,” or CAM, giving certain exchanges the option to register as either.
“These rules would codify a pathway for crypto asset exchanges to operate under uniform national oversight by the CFTC pursuant to the same statutory authorities that the prior administration instead utilized to regulate by enforcement,” said Selig.
CFTC Chair Michael Selig on Monday.
Source: Fordham Law Blockchain Regulatory Symposium
The proposed rules would not extend to what the chair called “ordinary spot crypto exchanges” that are “generally regulated under state money transmission laws.” For companies offering spot trading on crypto assets like Bitcoin (BTC), the CFTC would still have the authority to enforce anti-fraud and anti-manipulation regulations.
Selig’s proposed regulatory framework for crypto companies came a few weeks after lawmakers in the US Senate failed to approve passage of the Digital Asset Market Clarity (CLARITY) Act, a bill that had been expected to give the CFTC more authority in overseeing and enforcing crypto regulations.
The Securities and Exchange Commission already announced its own version of a proposed “tailored securities offering regime” for crypto assets in August before the failed CLARITY vote, setting the expectation that both agencies would move forward with regulation without legislation codifying such rules from Congress.
Selig said that Trump promised to deliver a crypto asset regulatory market structure with or without legislation, and the regulators will help him deliver it using existing statutory authorities.
“The opponents to CLARITY may have not bargained for the seeming readiness of the executive branch to act in the absence of any constraint from the legislative branch,” said ProChain Capital’s David Tawil, in a post on Monday.
Both regulators still understaffed as they advance crypto proposals
Friday was SEC Commissioner Hester Peirce’s last day at the agency, wrapping up eight years of service, just ahead of the 18-month extension for her second term. Her planned departure leaves just two commissioners leading the SEC and Selig heading the CFTC as its sole commissioner and chair.
A White House official told Cointelegraph last week that Trump intended to nominate commissioners to both agencies “in the near future.” As of Monday, the administration had not announced any replacements for Peirce or the other six commissioner seats.
Magazine: Former SEC boss made AI Czar, Bitcoin may hit $600K this cycle: Hodler’s Digest

Bitcoin (BTC) is coming off its best third quarter since 2017, but extending the rally may prove more difficult as Treasury yields above 5% offer investors an increasingly attractive alternative to risk assets, according to Delphi Digital.
In its latest weekly newsletter, Delphi highlighted Bitcoin’s 43% gain in the third quarter, followed by a third straight weekly advance last week. However, “the grind higher is happening against real resistance,” Delphi wrote, pointing to the Federal Reserve’s September rate hike and surging Treasury yields, which have reached multi-decade highs.
“When a government bond pays over 5% risk-free, every risky asset has to work harder to deserve the money,” Delphi wrote.
Bitcoin has so far managed to overcome the hurdle, helped in part by growing interest in the so-called debasement trade, or the view that persistent government borrowing and currency expansion will erode the dollar’s purchasing power.
According to Vanessa Grellet, managing partner at crypto-focused venture firm Arche Capital, “the debasement trade doesn’t require low interest rates,” given investors’ growing focus on federal deficits and the government’s rising interest bill.
Against this backdrop, Bitcoin’s price briefly topped $87,000 last week before correcting lower. It has gained more than 35% since mid-August, shortly after the US Treasury announced plans to double its long-dated debt buybacks to support market liquidity, targeting 10- and 20-year notes. Some investors viewed the move as an effort to ease strains in the bond market and contain borrowing costs. Those buybacks have since tripled in size.
Source: TradingView
Weak jobs data changes rate outlook, for now
The interest rate backdrop facing Bitcoin could become less restrictive after weaker-than-expected jobs data sharply reduced the odds of another Fed rate hike in October. The US economy added just 29,000 jobs in September, well below forecasts of 80,000, according to the Bureau of Labor Statistics’ latest nonfarm payrolls report.
The disappointing print added to signs that the labor market is cooling, giving the Fed more room to wait before raising rates again.
Even before the latest payrolls data, Fed officials had signaled they were in no hurry to act. Although policymakers penciled in one additional rate increase this year in their September projections, some officials have since urged patience.
New York Federal Reserve Bank President John Williams, a voting member of the Federal Open Market Committee this year, said the central bank does not need to rush into another hike.
“With the policy action we took at our September meeting, there is no need for urgency,” Williams said in a speech last week.
CME Group’s FedWatch Tool now puts the odds of an October increase at around 24%, down from more than 75% a week earlier.

Bitcoin (BTC) fluctuated around $86,000 after Monday’s Wall Street open as US bond yields continued to rise.
Key points:
Bitcoin rejected near its weekly close of $86,570 after the start of the US trading session.
US bond yields staged a rebounBitcoin price action continued with smaller moves, with the 2026 yearly open at $87,570 lingering overhead as key psychological resistance.d to eye new 24-year highs after dropping on Friday.
Glassnode analysis reported less “aggressive upward momentum” visible in onchain data in recent days.
Bitcoin indecisive as US bond yields return higher
Data from TradingView showed BTC/USD struggling to move beyond its weekly open level near $86,500 after the highest weekly close since late January.
BTC/USD one-hour chart. Source: Cointelegraph/TradingView
US bond yields, already under scrutiny, headed higher on the day. The 30-year yield passed 5.67% once again, just two basis points below 24-year highs seen last week. The 10-year yield returned to 5.31%, with last week’s high at 5.34%.
US 30-year bond yield one-hour chart. Source: Cointelegraph/TradingView
Commenting, trading company QCP Capital reiterated that even recent cooler US employment data had not been enough to calm bond markets as broader geopolitical uncertainty persisted.
“Despite the dovish employment print, elevated oil prices and elevated long-dated yields continue to limit upside momentum for risk assets broadly,” it wrote in its latest analysis.
US stocks opened moderately higher on Monday, with the S&P 500 and tech-heavy Nasdaq Composite Index up 0.5% and 0.7%, respectively, as traders saw the Federal Reserve pausing interest-rate hikes at the next Federal Open Market Committee (FOMC) meeting on Oct. 28.
S&P 500 one-day chart. Source: Cointelegraph/TradingView
In a note quoted by CNBC, Deutsche Bank analysts suggested that the minutes from the September FOMC meeting, to be released on Wednesday, would carry more weight than usual due to the bond sell-off.
“The highly unsettled bond market makes the incoming US data and Fed communication particularly relevant. So the minutes will be worth watching for how the broader Committee is framing the current tightening cycle and for its discussion of the neutral rate, where estimates shifted higher in the September SEP,” they wrote, referring to the Fed’s most recent summary of economic projections.
BTC price “aggressive upward momentum” fades
Bitcoin price action continued with smaller moves, with the 2026 yearly open at $87,570 lingering overhead as key psychological resistance.
Compared to mid-September, when BTC/USD returned to $87,000 for the first time in eight months, onchain analytics platform Glassnode flagged a drop in buyer dominance.
“This behavior reflects a moderation in aggressive upward momentum without signalling an immediate trend reversal or structural exhaustion,” it wrote in its latest Weekly Market Pulse on Monday.
Glassnode added that Bitcoin has held its September upside even as profit-taking continues to “run hot.” Previously, Cointelegraph reported on BTC owned by long-term holders (LTHs) being of particular interest in the area beyond $85,000.