Crypto Regulations & Policy

The Battle for Blockchain Autonomy Decoding the CLARITY Act and the Future of Developer Liability

by Jia Lissa
written by Jia Lissa

The legislative landscape for digital assets in the United States is currently defined by a high-stakes debate over the fundamental nature of accountability in the digital age. At the center of this controversy is the Cryptocurrency, Ledger, and Assertions Responsibility, Information, and Transparency (CLARITY) Act, specifically Section 109, which seeks to codify protections for software developers who create decentralized tools but do not exercise control over user assets. This provision, largely mirrored in the standalone Blockchain Regulatory Certainty Act (BRCA), has become a flashpoint for a broader philosophical and legal conflict: whether the law should hold creators responsible for the eventual use of their code, or whether liability should remain strictly tethered to the exercise of power and control.

As the bill moves through the legislative process, a vocal critique has emerged, most notably from Carole House, a former official with the White House National Security Council. The debate hinges on the interpretation of the slogan "accountability follows power." While proponents of the CLARITY Act argue that the bill embodies this principle by distinguishing between custodial intermediaries and non-controlling developers, critics contend that the lack of a mandatory intermediary in decentralized systems creates a "loophole" that could be exploited by illicit actors. This clash represents a pivotal moment for the American technology sector, as the outcome will likely dictate the regulatory trajectory for not only blockchain but also emerging fields like artificial intelligence.

Historical Context and the Evolution of Money Transmission Law

To understand the current tension surrounding the CLARITY Act, it is necessary to examine the history of money transmission regulation in the United States. For decades, the Financial Crimes Enforcement Network (FinCEN), a bureau of the Department of the Treasury, has been the primary authority overseeing the Bank Secrecy Act (BSA). The BSA requires "financial institutions" to maintain rigorous anti-money laundering (AML) and "know your customer" (KYC) programs.

Historically, FinCEN has maintained a clear distinction between entities that facilitate the movement of value and those that merely provide the technical infrastructure to do so. In 2014, FinCEN issued a landmark administrative ruling stating that the "production and distribution of software, in and of itself, does not constitute acceptance and transmission of value." This established the precedent that being a software developer is not synonymous with being a money transmitter.

This position was further clarified in 2019 guidance, which reaffirmed that the application of money-transmission law depends on the underlying activities a person performs, rather than the labels applied to the technology. This functional approach remained consistent across both the Obama and Trump administrations. Proponents of the BRCA and the CLARITY Act argue that Section 109 is not a radical departure from the norm but rather a codification of this long-standing "regulatory common sense." By providing a statutory "functional test," the legislation aims to ensure that developers who lack the "unilateral and independent ability to control" transactions are not subjected to the same burdens as multi-billion-dollar custodial exchanges.

The Functional Test: Control Versus Creation

The core of the CLARITY Act’s developer protection lies in its functional definition of a non-controlling developer. Under Section 109, a developer qualifies for protection only if they lack the legal right or the technical ability to initiate, control, or effectuate transactions involving a user’s assets without that user’s explicit approval.

This distinction is vital for the operation of decentralized finance (DeFi) and self-custody wallets. In a traditional banking model, a financial institution like a bank or a payment processor like Visa acts as a "chokepoint." They have the power to freeze accounts, reverse transactions, and monitor all activity on their network. Because they possess this power, the law imposes the duty to use it for law enforcement purposes.

In contrast, a developer who writes open-source code for a self-custody wallet provides a tool that users operate independently. Once the code is published, the developer often has no more control over the user’s funds than a locksmith has over a homeowner’s valuables after the lock is installed. Proponents of the bill argue that imposing money-transmission obligations on such developers is not only technically impossible—since they cannot "know" their customers or "block" transactions—but also legally unsound, as it would require "liability follows proximity to technology" rather than "accountability follows power."

The Critique of Forced Reintermediation

The opposition to these protections, led by figures like Carole House, suggests a different paradigm. This perspective argues that every powerful software system must have an identifiable intermediary whom the government can compel to monitor and control its users. This is often referred to by industry analysts as "forced reintermediation."

Critics of the CLARITY Act often compare decentralized protocols to networks like Visa, Mastercard, or traditional "hawala" networks. However, legal experts point out a fundamental flaw in this analogy. Visa and Mastercard are centralized corporations that establish network rules, admit participants, and maintain infrastructure. Hawala dealers are human agents who coordinate transfers through a network of counterparties.

In a truly decentralized system like Bitcoin, there is no central administrator. The system is maintained by a distributed network of participants following a mathematical protocol. The logic of "forced reintermediation" would essentially render such decentralized systems illegal unless they were redesigned to include a centralized point of control—a move that would eliminate the very security and censorship-resistance features that make blockchain technology valuable.

Lessons from Section 230 and the Early Internet

The debate over the CLARITY Act frequently draws parallels to Section 230 of the Communications Decency Act, the 1996 law that protected early internet service providers from being held liable for the content posted by their users. Section 230 is widely credited with allowing the modern internet to flourish by preventing platforms from being treated as the "publisher" of every user statement.

Critics of the CLARITY Act argue that Section 230 was a mistake or that its protections have been overextended. They point to the "trafficking-related exception" added by Congress as proof that intermediary immunity can be dangerous. However, proponents of the CLARITY Act point to a 2021 report by the Government Accountability Office (GAO) regarding the impact of the FOSTA-SESTA trafficking exception. The GAO found that after the exception was enacted, many platforms moved overseas, the market fragmented, and law enforcement actually found it harder to gather evidence because the activity migrated to less visible venues.

The lesson for the crypto industry, proponents argue, is that targeting infrastructure providers—who cannot distinguish lawful from unlawful conduct—does not stop the crime; it simply drives it underground and stifles domestic innovation. Furthermore, while Section 230 provides a status-based protection for "interactive computer services," the CLARITY Act provides a conduct-based protection. It asks a direct functional question: Does this person control the money? If they do, they are regulated. If they do not, they are not.

Broader Implications for AI and Privacy

The implications of this legislative battle extend far beyond the realm of cryptocurrency. Carole House and other critics have warned that the protections in the CLARITY Act might influence the regulation of artificial intelligence. If developers of "autonomous agents" or AI models are not held responsible for the actions of those models, critics fear a lack of accountability.

However, the counter-argument is that holding a software author responsible for every autonomous action a user might perform with their code would effectively end open-source development. In an era where AI agents may soon perform financial transactions, the government must decide if it will allow for private, peer-to-peer digital interaction or if it will mandate a "financial panopticon" where every line of code must include a government-accessible "kill switch."

The 1997 "Framework for Global Electronic Commerce" issued by the Clinton administration provides a historical roadmap for the pro-innovation side. That directive cautioned against "inflexible and highly prescriptive regulations" and urged the government to recognize the decentralized nature of the internet. Proponents of the CLARITY Act argue that they are defending this liberal, market-driven approach, while critics are advocating for an authoritarian model of pervasive surveillance.

Economic Data and the Path Forward

The stakes for the U.S. economy are significant. According to various industry reports, the United States’ share of the global blockchain developer workforce has been steadily declining over the last decade, dropping from 40% in 2015 to roughly 24% in 2023. Industry advocates argue that regulatory uncertainty—specifically the threat of being labeled an unlicensed money transmitter for simply writing code—is a primary driver of this "brain drain."

The CLARITY Act aims to reverse this trend by providing the "regulatory certainty" its name suggests. By creating new categories of federally regulated crypto intermediaries—such as digital commodity exchanges and brokers—the bill actually expands the reach of the Bank Secrecy Act to the entities that truly possess power over customer assets. It subjects these businesses to suspicious-activity monitoring and U.S. sanctions compliance, ensuring that "accountability follows power" in a way that is both effective and technically feasible.

As the Senate considers its version of the bill, the debate remains a fundamental test of American values. The choice is between a regulatory framework that respects the distinction between "code" and "conduct," or one that mandates the redesign of the digital world around points of centralized government control. For the developers of the next generation of the internet, the outcome of the CLARITY Act will determine whether the United States remains a hub for innovation or becomes a jurisdiction where the mere act of publishing software is a high-risk legal gamble.

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Crypto Regulations & Policy

US Senate Faces Tight Deadlines for Digital Asset Market Clarity Act as Summer Recess Approaches

by Sagoh
written by Sagoh

The United States Senate is navigating a precarious legislative calendar as leadership attempts to initiate floor proceedings for the Digital Asset Market Clarity Act, a landmark piece of legislation intended to provide a comprehensive regulatory framework for the cryptocurrency industry. Senate Majority Leader John Thune expressed a desire on Thursday to begin the formal floor process for the bill before the chamber adjourns for its summer recess. However, the prospect of finalizing the crypto market structure bill by the industry’s preferred deadline of August 7 appears increasingly dim. The complexity of the legislation, coupled with a crowded legislative docket and deep-seated partisan divisions over specific provisions, suggests that while the process may start in the coming days, a final vote is likely to be deferred until the autumn.

Majority Leader Thune, speaking to reporters at the Capitol, indicated that his priority is to move the bill into the active consideration phase to gauge the level of support among the 100 members of the Senate. "I would like to at least get Clarity started," Thune remarked, referring to the bill by its colloquial name. "We’ll see where the votes are." This strategic move to begin consideration before the break is seen by many political analysts as a "placeholder" maneuver. By starting the floor process now, the Senate can preserve a procedural path that allows for a smoother resumption of work when lawmakers return to Washington in September.

The legislative clock is a significant factor in the current tension. The Senate is scheduled to begin its summer state work period on August 10, with lawmakers not expected to return to the floor until September 14. Industry representatives and congressional negotiators have long viewed August 7 as the practical deadline for the bill’s passage. This date is seen as a "point of no return" because, upon returning in mid-September, the focus of both parties will shift almost exclusively toward the November midterm elections. Legislative windows in an election year are notoriously brief, and any bill that is not substantially advanced by the end of summer faces a high risk of being sidelined in favor of campaign-related priorities and essential funding measures.

The Legislative Journey and Chronology

The Digital Asset Market Clarity Act represents the culmination of several years of intensive debate regarding how the United States should govern the burgeoning digital asset sector. The current momentum follows a significant milestone reached in July 2025, when the House of Representatives approved its own version of a market structure bill. That House bill was characterized by a more aggressive push toward empowering the Commodity Futures Trading Commission (CFTC) and was largely supported by industry advocacy groups seeking a departure from the "regulation by enforcement" approach often attributed to the Securities and Exchange Commission (SEC).

Following the House’s action, the Senate spent nearly a year drafting its own response. The latest draft of the Clarity Act is a sophisticated synthesis of proposals from two powerful committees: the Senate Banking Committee and the Senate Agriculture Committee. This dual-committee approach was necessary because of the overlapping jurisdictions regarding digital assets; the Banking Committee oversees the SEC and traditional financial markets, while the Agriculture Committee oversees the CFTC and commodity markets.

The combined draft was released earlier this week, sparking a flurry of activity among lobbyists and policymakers. The bill aims to set clear rules for digital asset exchanges, intermediaries, issuers, and federal oversight bodies. It seeks to provide a definitive answer to the long-standing question of which digital assets are securities and which are commodities, a distinction that carries massive implications for compliance costs and operational requirements for firms like Coinbase, Kraken, and various decentralized finance (DeFi) protocols.

Core Provisions and Regulatory Oversight

At the heart of the Digital Asset Market Clarity Act is the establishment of a joint regulatory framework between the SEC and the CFTC. For years, the digital asset industry has complained of a lack of "clarity," arguing that the absence of a clear statutory definition has allowed regulators to flip-flop on the status of various tokens. The Act proposes a "functional" test to determine an asset’s status. Under the current draft, assets that are decentralized and do not offer the holder a financial interest in an entity would largely fall under the CFTC’s jurisdiction as digital commodities. Conversely, assets that involve a centralized team and the expectation of profit based on the efforts of others would remain under the SEC’s purview as securities.

The bill also introduces rigorous requirements for digital asset exchanges. These include:

  1. Customer Protection Standards: Mandatory segregation of customer funds from corporate assets, a provision directly inspired by the collapse of major platforms in previous years.
  2. Disclosure Requirements: Issuers of digital assets would be required to file periodic disclosures with their respective regulator, ensuring transparency regarding the project’s development, tokenomics, and potential risks.
  3. Operational Resilience: Exchanges would be required to meet specific cybersecurity and system safeguards to protect against hacks and outages.
  4. Federal Oversight of Intermediaries: Brokers and dealers operating in the crypto space would be required to register with a self-regulatory organization (SRO), similar to the oversight provided by FINRA in traditional markets.

Despite these foundational improvements, the bill has encountered significant friction in the Senate. As of Thursday, the chamber had not yet entered floor consideration for the Clarity Act. Instead, the Senate floor has been occupied by a backlog of judicial nominations, a high-stakes Iran war powers resolution, and the annual defense authorization bill, which remains a "must-pass" priority for both parties.

Partisan Divisions and Contentious Issues

The primary obstacles to the bill’s advancement are not found in its general goals but in its specific implementation. Lawmakers remain deeply divided over two primary issues: stablecoin rewards and ethics restrictions on senior government officials.

The debate over stablecoin rewards centers on whether certain types of yield-bearing stablecoins should be classified as banking products or securities. Democrats have expressed concerns that allowing stablecoins to offer rewards without traditional banking oversight could create a "shadow banking" system that poses systemic risks to the broader financial economy. Some Republicans, on the other hand, argue that overly restrictive rules on stablecoin rewards would stifle innovation and drive the stablecoin market—currently dominated by U.S. dollar-pegged assets—to offshore jurisdictions.

Ethics restrictions have emerged as another flashpoint. The bill includes provisions that would limit the ability of senior government officials at the SEC and CFTC to transition immediately into high-paying roles within the digital asset industry after leaving public service. Democrats have pushed for the Justice Department (DOJ) to have the primary responsibility for enforcing these ethics rules, arguing that an independent law enforcement body is necessary to prevent "regulatory capture." This proposal has met with stiff resistance from Republicans and some moderate Democrats, who argue that the DOJ’s involvement would overly politicize the regulatory process and that the agencies themselves are better equipped to handle internal ethics.

Senator Cynthia Lummis, a long-time advocate for crypto legislation, acknowledged these hurdles but remained optimistic about the possibility of a compromise. She noted that the most contentious provisions remain open to revision as negotiators seek the Democratic support necessary to reach the 60-vote threshold required to overcome a filibuster in the Senate. "We are in the ‘fine-tuning’ phase," Lummis said. "The goal is to create a framework that can garner broad bipartisan support, but that requires concessions on both sides regarding enforcement and stablecoin structures."

The 60-Vote Hurdle and Political Pressures

The arithmetic of the Senate remains the biggest challenge for the Digital Asset Market Clarity Act. With a narrowly divided chamber, the bill’s proponents must secure at least 60 votes to advance. This means that even if the Republican leadership is unified, they must win over a significant number of Democrats.

The looming midterm elections add a layer of volatility to these negotiations. For many lawmakers, a vote on a complex financial bill like the Clarity Act is a "high-risk, low-reward" endeavor so close to an election. Opponents could easily frame the bill as a "bailout for crypto billionaires" or, conversely, as "government overreach that kills American innovation." As the November elections approach, the political appetite for nuanced, bipartisan compromise often evaporates in favor of more populist, base-pleasing rhetoric.

Furthermore, even if the Senate manages to pass an amended version of the bill in September, the legislative process is far from over. Any changes made by the Senate would require the bill to return to the House of Representatives for a "concurrence" vote or go to a conference committee to resolve differences between the two versions. Only after both chambers agree on identical language can the bill be sent to the desk of President Donald Trump for his signature.

Market Implications and Industry Reaction

The digital asset industry has been following the progress of the Clarity Act with a mixture of hope and anxiety. Market data suggests that regulatory uncertainty remains one of the primary headwinds for institutional adoption of digital assets in the United States. According to recent industry reports, several major financial institutions have paused their plans to launch crypto-related services pending the outcome of the market structure debate.

The "August 7 window" is viewed by the industry as a critical milestone. Missing this window would likely mean that no federal framework will be established until 2027 at the earliest, given the time required for a new Congress to organize and restart the legislative process. This delay could have tangible economic consequences. Data from blockchain analytics firms indicate a steady "capital flight" of crypto startups moving their headquarters to regions with more established rules, such as the European Union under its Markets in Crypto-Assets (MiCA) regulation, or the United Arab Emirates.

Industry representatives have urged the Senate to move quickly. In a statement released following Senator Thune’s comments, a coalition of digital asset trade groups emphasized the urgency of the situation: "The United States is currently at a competitive disadvantage. Without a clear federal framework, innovation will continue to move offshore, and American investors will remain without the protections they deserve. We urge the Senate to prioritize the Digital Asset Market Clarity Act before the summer recess."

Broader Impact and Future Outlook

The outcome of the Digital Asset Market Clarity Act will serve as a bellwether for the future of financial regulation in the United States. If the bill passes, it would represent one of the most significant updates to federal securities and commodities laws in decades. It would signal that the U.S. government is willing to adapt its regulatory philosophy to accommodate new technologies while maintaining market integrity.

If the bill fails to gain traction before the recess, the focus will shift to the SEC’s ongoing enforcement actions. Without new statutory guidance from Congress, the SEC is expected to continue its current trajectory of bringing lawsuits against exchanges and token issuers based on existing, decades-old case law. This "status quo" is exactly what the Clarity Act seeks to change, but the path to reform is narrow and fraught with political obstacles.

As the Senate enters the final days before its August break, all eyes will be on the floor to see if Majority Leader Thune follows through on his intent to "get Clarity started." While a full passage by August 7 seems improbable, the mere act of beginning the debate could be the catalyst needed to ensure the bill remains a priority in a crowded September schedule. For the digital asset industry, the stakes could not be higher, as the window for legislative action in this Congress begins to close.

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Japanese & Asian Crypto Markets

Goldman Sachs CEO David Solomon Expresses Strong Support for CLARITY Act to Formalize US Cryptocurrency Market Structure

by Asep Darmawan
written by Asep Darmawan

David Solomon, the Chairman and Chief Executive Officer of Goldman Sachs, has formally signaled his support for the "CLARITY Act," a pivotal piece of legislation currently under deliberation in the United States Senate aimed at establishing a comprehensive regulatory framework for the digital asset market. In an interview published by Politico on July 23, 2026, Solomon emphasized that the bill represents a necessary step toward refining market infrastructure and accelerating the pace of financial innovation. While Solomon acknowledged that the legislation is not without its flaws, he argued that the primary objective must be the creation of a level playing field that enhances market stability and allows for the orderly development of the digital asset sector.

The endorsement from one of Wall Street’s most influential figures highlights a growing divergence within the American banking industry regarding the future of decentralized finance and stablecoins. Solomon’s stance places Goldman Sachs at the forefront of a movement seeking to integrate blockchain technology into traditional capital markets, even as other major financial institutions and industry advocacy groups express significant reservations.

The Legislative Framework of the CLARITY Act

The CLARITY Act—formally known as the Creating Legal Accountability and Regulatory Information for Technologies and Yield Act—is designed to resolve the long-standing jurisdictional disputes between various federal regulators, including the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). At its core, the bill seeks to provide a clear definition of digital assets, distinguishing between those that function as securities and those that act as commodities or payment stablecoins.

For Solomon and Goldman Sachs, the bill’s importance lies in its potential to bring regulated institutions more deeply into the fold. "The goal is to allow regulated, supervised institutions to participate more actively in the market," Solomon noted during his remarks. He further explained that while many points of the bill remain subject to debate, the overarching necessity is to move away from the "regulation by enforcement" model that has characterized the U.S. crypto landscape for the past several years.

A Growing Divide Among Wall Street Giants

Solomon’s vocal support for the CLARITY Act stands in stark contrast to the positions held by other prominent banking leaders, most notably Jamie Dimon, CEO of JPMorgan Chase. Dimon has been a long-standing critic of the broader cryptocurrency market, frequently citing concerns over its potential use in illicit activities. However, the more immediate policy disagreement involves the treatment of stablecoins and the impact on the commercial banking sector.

Executives at JPMorgan Chase and other major commercial banks have argued that the current draft of the CLARITY Act could expose the banking system to undue risk. Their primary concern involves the requirements for stablecoin issuers to hold reserves in commercial bank accounts. Critics of the bill argue that if crypto companies are permitted to hold massive amounts of dollar-pegged reserves without being subject to the same stringent capital requirements as traditional banks, it could create a "narrow banking" system that drains liquidity from the broader economy.

Furthermore, commercial banks are concerned that if they are required to provide custody and transaction services for stablecoins without sufficient fee structures or regulatory protections, they could be left holding the risk if a stablecoin issuer faces a liquidity crisis. This tension illustrates the fundamental difference between the business models of investment banks like Goldman Sachs and commercial giants like JPMorgan. Goldman Sachs, which relies less on retail deposits and more on institutional capital markets and investment banking fees, views the tokenization of assets as a significant technological upgrade rather than a threat to a deposit-based business model.

Opposition from the American Bankers Association

The debate over the CLARITY Act is not confined to the executive suites of New York’s largest banks. On July 22, 2026, a coalition of six major financial industry groups, led by the American Bankers Association (ABA), issued a joint statement expressing deep concern over specific provisions of the bill. The ABA argued that the legislation, in its current form, could "undermine the regional lending that supports the U.S. economy."

The crux of the ABA’s argument is that the bill might inadvertently encourage the migration of deposits out of the traditional banking system and into digital wallets. For community and regional banks, which rely heavily on these deposits to fund mortgages, small business loans, and local infrastructure projects, such a shift could be catastrophic. The association has called for significant amendments to ensure that the digital asset market does not gain an unfair competitive advantage over the highly regulated traditional banking sector.

Chronology of Recent Legislative Developments

The path of the CLARITY Act has been marked by intensive lobbying and shifting political winds. Below is a timeline of the key events leading up to the current stalemate in the Senate:

Goldman SachsのソロモンCEO、クラリティ法案を「強く支持」＝報道 | NADA NEWS（ナダ・ニュース）
  • Early June 2026: Bipartisan negotiations begin in the Senate Banking Committee to merge several competing digital asset bills into a single, comprehensive framework.
  • July 10, 2026: Goldman Sachs and several other investment banks submit a white paper to the Treasury Department advocating for clearer rules on the tokenization of Real-World Assets (RWA).
  • July 22, 2026: Republican leadership in the Senate releases the latest draft of the CLARITY Act, which includes expanded provisions for stablecoin issuers but maintains strict oversight by the CFTC for most digital commodities.
  • July 22, 2026 (Evening): The American Bankers Association and five other groups issue their formal opposition, citing risks to the "credit intermediation" process of the U.S. banking system.
  • July 23, 2026: David Solomon’s interview is published, providing a powerful counter-narrative to the ABA’s opposition and signaling that institutional investors are eager for the bill’s passage.
  • July 23, 2026: Senate Majority Whip John Thune provides a sober assessment of the bill’s prospects, indicating that a vote before the August 7 summer recess is highly unlikely due to unresolved disputes over consumer protection clauses.

The Role of John Thune and the Path to Passage

The legislative outlook remains murky. Senator John Thune, a key figure in the Senate’s Republican leadership, has acknowledged the difficulty of reaching a consensus in the short term. While there is a general agreement that the U.S. needs a regulatory framework to remain competitive with Europe and Asia, the details of that framework are where the bipartisan consensus breaks down.

Democrats in the Senate have expressed concerns that the CLARITY Act does not go far enough in protecting retail consumers from the volatility and fraud that have plagued the crypto industry in the past. They are pushing for more rigorous "Know Your Customer" (KYC) and Anti-Money Laundering (AML) requirements to be baked into the market structure. Conversely, Republicans are wary of over-regulation that could drive innovation overseas to jurisdictions like Switzerland, Singapore, or the United Arab Emirates.

Thune’s comments on July 23 suggest that the Senate will likely revisit the bill in the fall session. "The complexity of the issues involved, particularly the intersection of digital assets and the traditional banking system, requires more time for deliberation than the current calendar allows," Thune stated.

Goldman Sachs and the Vision for Blockchain

Goldman Sachs’ support for the CLARITY Act is rooted in its long-term strategic vision. Under Solomon’s leadership, the bank has invested heavily in its Digital Assets Platform (GS DAP), which utilizes blockchain technology to facilitate the issuance and trading of financial instruments.

In late 2025 and early 2026, Goldman successfully managed several tokenized bond issuances for European sovereign entities. These transactions proved that blockchain could significantly reduce settlement times—from days to mere minutes—while lowering administrative costs. However, to scale these operations in the United States, Goldman requires a legal environment where digital representations of securities are recognized with the same legal weight as their paper or electronic counterparts.

By supporting the CLARITY Act, Solomon is essentially advocating for the infrastructure that would allow Goldman Sachs to become a dominant player in the future of "On-Chain Finance." For the bank, the bill is less about the price of Bitcoin and more about the efficiency of the plumbing that moves trillions of dollars through the global financial system.

International Context: Japan and the Global Standard

The urgency felt by Solomon and other proponents of the CLARITY Act is underscored by regulatory developments outside the United States. In Japan, for instance, the government has already moved to categorize digital assets under the amended Financial Instruments and Exchange Act (FIEA) and the Payment Services Act. This has provided Japanese financial institutions with a degree of legal certainty that their American counterparts currently lack.

The European Union has also implemented the Markets in Crypto-Assets (MiCA) regulation, which provides a unified framework across all member states. If the U.S. fails to pass the CLARITY Act or similar legislation, Solomon warns that the global center of financial innovation could shift. This "regulatory arbitrage" is a major concern for U.S. policymakers who want to ensure that the U.S. dollar remains the primary reserve currency, even in its digital or tokenized forms.

Analysis of Broader Implications

If the CLARITY Act eventually passes, it will likely mark the end of the "Wild West" era of the cryptocurrency market in the United States. The implications would be far-reaching:

  1. Institutional Adoption: With a clear legal framework, pension funds, insurance companies, and large endowments—many of which are currently sidelined due to regulatory uncertainty—would likely begin allocating capital to digital asset classes.
  2. Stablecoin Dominance: The bill would likely solidify the role of U.S. dollar-backed stablecoins as the primary medium of exchange in the digital economy, potentially strengthening the global position of the dollar.
  3. Banking Evolution: The tension between investment banks like Goldman Sachs and commercial banks like JPMorgan will likely lead to a broader debate about the nature of banking in the 21st century. We may see the rise of "hybrid" institutions that manage both traditional deposits and decentralized protocols.
  4. Consolidation: Smaller crypto startups that cannot afford the compliance costs associated with the CLARITY Act may be forced to merge with larger, established financial institutions, leading to a more consolidated and "corporate" digital asset sector.

As the Senate prepares for its summer recess, the fate of the CLARITY Act remains a focal point for the financial industry. While David Solomon’s endorsement provides a significant boost to the bill’s momentum, the resistance from commercial banking groups and the complexities of the legislative process suggest that the road to a regulated crypto market in the U.S. is still fraught with obstacles. For now, the eyes of the global financial community remain fixed on Washington, waiting to see if the world’s largest economy will finally provide the "clarity" it has promised for so long.

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Japanese & Asian Crypto Markets

Swiss Cantonal Bank BancaStato Launches Regulated Crypto Trading and Custody Services in Partnership with Sygnum and Avaloq

by Nila Kartika Wati
written by Nila Kartika Wati

The Cantonal Bank of Ticino, known as BancaStato, has officially entered the digital asset market by launching fully regulated cryptocurrency trading and custody services for its clientele. This strategic move, announced on July 23, 2026, was made possible through a tripartite collaboration involving Sygnum, the world’s first digital asset bank, and Avaloq, a global leader in core banking technology and cloud-based solutions. By integrating Sygnum’s institutional-grade B2B banking platform directly into BancaStato’s existing infrastructure, the 111-year-old institution has bridged the gap between traditional Swiss banking and the burgeoning decentralized finance ecosystem.

Through this new offering, BancaStato customers can now buy, sell, and hold four major cryptocurrencies—Bitcoin (BTC), Ethereum (ETH), Solana (SOL), and Litecoin (LTC)—directly through their familiar web banking portals and mobile applications. The integration represents a significant milestone in the mass adoption of digital assets within Switzerland, as it marks the first time a bank has successfully implemented a cryptocurrency solution within Avaloq’s Software as a Service (SaaS) environment without requiring a standalone Order Management System (OMS). This technical achievement significantly reduces operational complexity and overhead costs, setting a new benchmark for how legacy financial institutions can pivot toward blockchain technology.

Technical Integration and the Removal of Operational Barriers

The cornerstone of the BancaStato crypto launch is the seamless technical synergy between Sygnum’s API-led B2B platform and the Avaloq Core Platform. Historically, traditional banks looking to offer digital assets faced a "double-entry" problem. They typically had to maintain a separate system to manage crypto orders and another for their traditional ledger, often requiring a complex middle-layer Order Management System to reconcile the two. This not only increased the risk of manual error but also created significant latency and increased the total cost of ownership for the bank.

By leveraging Sygnum’s B2B API within the Avaloq SaaS ecosystem, BancaStato has bypassed these hurdles. When a customer places a market order in US Dollars or specifies a quantity of Bitcoin through the BancaStato app, the request is routed through Sygnum’s institutional liquidity pools via a direct API connection. The transaction is executed, settled, and recorded within the bank’s core system in real-time. This "one-stop-shop" architecture ensures that digital assets are treated with the same level of administrative rigor as traditional equities or bonds, providing a unified view of the customer’s total wealth.

This integration is particularly noteworthy because it utilizes Avaloq’s cloud-based infrastructure. As more banks migrate from on-premise servers to SaaS models, the ability to "plug and play" digital asset services becomes a critical competitive advantage. For BancaStato, this means the bank can scale its crypto offerings—adding more tokens or staking services in the future—without needing to overhaul its underlying IT architecture.

Institutional-Grade Custody and the Swiss Legal Framework

Security and regulatory compliance remain the primary concerns for retail and institutional investors entering the crypto space. To address these concerns, BancaStato utilizes Sygnum’s multi-layered custody solution. This system employs a combination of hardware and software security modules, including cold storage and multi-party computation (MPC) protocols, to ensure that private keys are never exposed to a single point of failure.

A critical component of this service is the legal status of the assets. Under Swiss law, and specifically the framework utilized by Sygnum, all digital assets held on behalf of BancaStato’s clients are maintained as off-balance-sheet items. This means that the cryptocurrencies are legally segregated from the bank’s own assets. In the highly unlikely event of a bank insolvency, these digital assets would be fully protected and returned to the clients, rather than being treated as part of the bankruptcy estate. This level of protection is a hallmark of the Swiss "Crypto Valley" regulatory approach, which aims to provide investors with the same safety nets found in traditional asset classes.

Furthermore, the custody process is subject to rigorous governance and independent external audits. By outsourcing the technical custody to Sygnum while maintaining the client relationship, BancaStato provides its customers with a "best of both worlds" scenario: the agility and technical prowess of a digital-native bank combined with the stability and local trust of a government-backed cantonal institution.

The Strategic Expansion of the Sygnum B2B Network

The addition of BancaStato to Sygnum’s B2B network is part of a broader trend of institutional adoption across the Swiss Confederation. Sygnum now provides digital asset services to more than 25 banks and financial institutions, a network that effectively covers more than one-third of the Swiss population. Other notable members of this network include Zuger Kantonalbank (ZKB) and PostFinance, the financial services arm of the Swiss Post.

For Sygnum, the partnership with BancaStato represents a strategic victory in the Italian-speaking region of Ticino. Founded in 1915 and headquartered in Bellinzona, BancaStato is a cornerstone of the Ticino economy. The region has recently positioned itself as a hub for blockchain innovation, most notably through the "Plan ₿" initiative in Lugano, which seeks to integrate Bitcoin and stablecoins into the city’s everyday payment infrastructure. By empowering the region’s primary cantonal bank with crypto capabilities, Sygnum is reinforcing the financial plumbing required to support this regional digital transformation.

Fritz Jost, Chief B2B Officer at Sygnum, noted that the demand for API-driven digital asset services is growing exponentially as banks realize that crypto is no longer a niche interest but a core component of a modern investment portfolio. The success of the BancaStato launch serves as a blueprint for other regional banks looking to modernize their service suites without taking on the massive R&D costs of building a blockchain platform from scratch.

Leadership Perspectives on the Future of Digital Finance

Executives from all three participating organizations have hailed the launch as a defining moment for the Swiss financial sector. Curzio De Gottardi, a member of the Executive Board and Head of Products and Services at BancaStato, emphasized that the bank’s mission is to provide comprehensive financial solutions that anticipate future market needs. He stated that the seamless integration of traditional and digital assets allows the bank to strengthen its value proposition, offering clients a modernized experience that does not compromise on the security or reliability that BancaStato is known for.

From the technology side, Christian Bauknecht, Managing Director for Switzerland and Liechtenstein at Avaloq, highlighted the importance of choice for bank clients. He noted that by enabling customers to manage digital and traditional assets in one place, banks are increasing client engagement and loyalty. This holistic approach to wealth management is expected to become the industry standard over the next decade.

The collaborative effort also underscores the maturity of the service provider ecosystem. While the early years of the crypto industry were defined by standalone exchanges and DIY storage, the current era is defined by sophisticated B2B2C (Business-to-Business-to-Consumer) models. In this model, the consumer interacts with their trusted local bank, the bank utilizes a specialized technology provider (Avaloq), and the technology provider connects to a regulated liquidity and custody engine (Sygnum).

Broader Impact and the Path Toward EU Integration (MiCAR)

The launch comes at a time when European crypto regulations are undergoing a massive shift. While Switzerland is not a member of the European Union, it has maintained a leading position in digital asset regulation through its DLT (Distributed Ledger Technology) Act. However, Sygnum is already looking beyond Swiss borders.

On June 30, 2026, Sygnum Europe—the group’s subsidiary—secured a Crypto-Asset Service Provider (CASP) license under the EU’s Markets in Crypto-Assets Regulation (MiCAR) from the Financial Market Authority (FMA) of Liechtenstein. This license is a "golden ticket" that allows Sygnum to passport its services across the entire European Economic Area (EEA).

The implications for the banking sector are profound. With the MiCAR framework now in place, banks across Germany, France, Italy, and beyond are looking for regulated partners to help them enter the market. The successful implementation at BancaStato provides a "proof of concept" for EU-based banks. They can see that it is possible to integrate crypto into a core banking system like Avaloq with minimal friction and maximum regulatory compliance.

As the digital asset market matures, the distinction between "crypto companies" and "traditional banks" is blurring. Institutions like BancaStato are proving that tradition and innovation are not mutually exclusive. By offering Bitcoin and Solana alongside traditional savings accounts, BancaStato is not just following a trend; it is ensuring its relevance for the next century of banking. The success of this launch suggests that the future of finance is hybrid, where the efficiency of the blockchain meets the institutional stability of the traditional banking system. For the people of Ticino, and Switzerland as a whole, this move represents a significant step toward a fully integrated digital economy.

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Japanese & Asian Crypto Markets

Illuvium Redefines Blockchain Gaming with AAA Open World RPG and Integrated Ecosystem on Immutable X

by Siti Muinah
written by Siti Muinah

Illuvium represents a pivotal shift in the decentralized application landscape, emerging as a premier decentralized gaming studio that blends high-fidelity graphical experiences with the robust economic incentives of blockchain technology. Developed as an interoperable blockchain game (IBG) ecosystem, Illuvium offers a multi-faceted experience encompassing an open-world exploration role-playing game (RPG), a strategic industrial city builder, and a competitive auto-battler. Unlike early iterations of blockchain games that prioritized financial mechanics over gameplay quality, Illuvium is widely recognized as one of the first "AAA" titles in the Web3 space, utilizing Unreal Engine 5 to deliver cinematic visuals and complex mechanical depth. The project aims to bridge the gap between traditional mainstream gaming and the burgeoning NFT market by providing a seamless, gas-free user experience on the Ethereum network.

Illuvium｜戦略性オートバトルの概要とゲームの基本情報まとめ

The Technical Architecture: Powering a Gas-Free Metaverse

The foundational technology of Illuvium is built upon the Ethereum blockchain, but it overcomes the network’s inherent scalability issues through a strategic partnership with Immutable X. As a Layer 2 scaling solution, Immutable X utilizes Zero-Knowledge (ZK) Rollup technology to facilitate instantaneous transactions and zero gas fees for minting and trading NFTs. This technical choice is critical for the game’s viability; in a monster-catching RPG where players may capture hundreds of creatures or trade thousands of small resource items, the high gas costs of the Ethereum mainnet would render the game unplayable for the average user.

By offloading transaction processing to Layer 2 while maintaining the security of the Ethereum settlement layer, Illuvium ensures that players retain true ownership of their in-game assets. Every "Illuvial"—the elemental creatures that inhabit the game world—is a unique NFT stored in the player’s wallet. This allows for a transparent secondary market where rarity, combat statistics, and aesthetic variations dictate real-world value, fostering a player-driven economy that operates 24/7 without centralized interference.

Illuvium｜戦略性オートバトルの概要とゲームの基本情報まとめ

Gameplay Mechanics: A Multi-Genre Universe

The Illuvium ecosystem is divided into three primary interconnected titles, each catering to different player archetypes while sharing a unified asset pool and lore.

Illuvium: Overworld

The Overworld serves as the flagship exploration mode. Players take on the role of a survivor on a shattered alien planet, navigating diverse biomes to harvest resources and track down elusive Illuvials. The exploration is characterized by high-mobility mechanics, including jetpacks and gravity-defying traversal. The core loop involves scanning for "singularities," entering combat encounters, and utilizing "Shards"—the ecosystem’s equivalent of capture devices—to secure defeated creatures. The rarity and power of the Shard used directly influence the success rate of the capture, introducing a layer of resource management to the exploration.

Illuvium｜戦略性オートバトルの概要とゲームの基本情報まとめ

Illuvium: Arena

Once creatures are captured, they are utilized in the Arena, a tactical auto-battler. This mode draws heavy inspiration from mainstream titles like Teamfight Tactics (TFT) and Dota Underlords. Combat is not decided by manual reflexes but by strategic positioning, team composition, and the understanding of elemental synergies. There are over 100 Illuvials, each categorized by five primary affinities (Water, Fire, Earth, Air, and Nature) and five classes (Fighter, Guardian, Rogue, Psion, and Empath). Advanced gameplay emerges through "Ascended" forms, where players can fuse three identical, max-level Illuvials to create a significantly more powerful evolution, or combine different affinities to unlock composite elements like Steam (Water + Fire) or Granite (Earth + Air).

Illuvium: Zero

Illuvium: Zero introduces the industrial and base-building component of the metaverse. Available on mobile and desktop, this mode allows landholders to manage their own plots of digital real estate. The primary objective is to build facilities that extract "Fuel," a vital resource used across all games in the ecosystem. Fuel is required for traveling in the Overworld, healing Illuvials, and forging high-tier equipment. By tying the production of essential game resources to land ownership, Illuvium creates a symbiotic relationship between casual players, competitive battlers, and digital landowners.

Illuvium｜戦略性オートバトルの概要とゲームの基本情報まとめ

The ILV Token and Decentralized Governance

The economic heartbeat of the project is the ILV token, an ERC-20 utility and governance token. Unlike many "Play-to-Earn" models that suffered from hyperinflation, Illuvium’s tokenomics are designed for long-term sustainability. The total supply is capped at 10 million tokens, with a significant portion allocated to yield farming and in-game rewards.

ILV serves three primary functions:

Illuvium｜戦略性オートバトルの概要とゲームの基本情報まとめ
  1. Governance: Token holders can participate in the Illuvinati Council, a decentralized autonomous organization (DAO) that votes on game balance, fee structures, and future development priorities.
  2. Staking: Users can lock their ILV in the protocol to earn passive rewards. Stakers have the option to receive rewards in ILV (subject to a 12-month lock-up) or sILV2, a synthetic token that can be used immediately as in-game currency.
  3. Revenue Distribution: In a unique move for the industry, 100% of the revenue generated from in-game purchases (such as Fuel sales, Shard curing, and skin purchases) is used to buy back ILV from the open market and distribute it to stakers. This creates a direct link between the game’s commercial success and the value provided to the community.

Development Chronology and Strategic Milestones

The journey of Illuvium has been marked by several high-profile milestones that have shaped the current state of the Web3 gaming market:

  • September 2020: The project is co-founded by Kieran, Aaron, and Grant Warwick, bringing a mix of blockchain expertise and professional gaming experience.
  • March 2021: Illuvium completes its Initial DEX Offering (IDO) on Balancer, raising approximately $38 million and setting records for participation.
  • June 2022: The first Illuvium Land Sale occurs, generating over $72 million in sales despite a broader market downturn, proving the high demand for the project’s digital real estate.
  • 2023: The project enters Private Beta phases, refining the "Arena" and "Overworld" mechanics based on feedback from thousands of early testers.
  • November 2023: Illuvium announces its listing on the Epic Games Store, a major step toward mainstream accessibility and a departure from the "crypto-only" gatekeeping often seen in the sector.
  • 2024-2026: The roadmap focuses on the transition from Open Beta to a full commercial launch, the integration of mobile versions, and the expansion of the "Illuvium Beyond" collectible card game.

Market Analysis and Competitive Positioning

The emergence of Illuvium comes at a time when the "Play-to-Earn" (P2E) model is evolving into "Play-and-Earn." Early pioneers like Axie Infinity demonstrated the potential of blockchain economies but struggled with sustainability when player growth plateaued. Illuvium’s strategy is to prioritize the "fun factor" first. By building a game that players would want to engage with regardless of the financial incentives, the developers are attempting to build a more resilient ecosystem.

Illuvium｜戦略性オートバトルの概要とゲームの基本情報まとめ

Industry analysts suggest that Illuvium’s success or failure will serve as a bellwether for the entire Web3 gaming industry. Its integration of complex DeFi mechanics (staking, DAO governance) with high-end game development is a blueprint that many other studios are now attempting to follow. The project’s decision to launch on the Epic Games Store is particularly significant, as it places a blockchain-integrated title alongside global hits like Fortnite, challenging the stigma surrounding NFTs in traditional gaming circles.

Broader Impact and Future Implications

Beyond the immediate scope of the game, Illuvium is contributing to the standardization of interoperable assets. In the traditional gaming world, a skin purchased in one game is useless in another. In the Illuvium universe, a player’s achievements and assets in "Zero" directly impact their capabilities in the "Overworld." This concept of a "unified profile" is a cornerstone of the theoretical Metaverse, where digital identity and property are persistent across different platforms.

Illuvium｜戦略性オートバトルの概要とゲームの基本情報まとめ

Furthermore, the project’s use of Immutable X highlights the maturity of Layer 2 solutions. As more developers realize that they can offer the security of Ethereum without the prohibitive costs, the barrier to entry for decentralized applications continues to drop. For the broader gaming industry, Illuvium represents a bold experiment in decentralized ownership. If the model proves successful, it could shift the power dynamic away from centralized publishers and toward the players, who not only play the games but also own the assets and govern the rules of the world they inhabit.

As the ecosystem moves toward its projected full release in the 2025-2026 window, the focus remains on scaling the player base and maintaining economic balance. With a community-led DAO and a transparent development cycle, Illuvium stands as a testament to the potential of decentralized technology to create immersive, high-quality entertainment that respects the digital rights of its users.

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Japanese & Asian Crypto Markets

Essential Security Protocols for Navigating the Web3 Ecosystem: A Comprehensive Guide to Asset Protection and Scam Prevention

by Asro
written by Asro

The transition from the traditional internet to Web3—a decentralized ecosystem built on blockchain technology—represents a paradigm shift in how digital value is managed and owned. However, this new frontier of "sovereign ownership" brings with it a stark reality: the total removal of centralized safety nets. In the world of Web3, the individual is solely responsible for the security of their assets. There is no "forgot password" link for a seed phrase, and no centralized bank to reverse a fraudulent transaction. As the adoption of Decentralized Finance (DeFi) and Non-Fungible Tokens (NFTs) continues to grow, so too does the sophistication of cybercriminals. Protecting one’s digital footprint requires a combination of technical tools, rigorous habits, and a fundamental understanding of how blockchain transparency can be weaponized against users.

【3分でわかるWeb3.0基礎講座】セキュリティ

The Transparency Paradox: Public Ledgers as a Target List

One of the defining features of blockchain technology is its radical transparency. Every transaction, wallet balance, and smart contract interaction is recorded on a public ledger, such as the Ethereum blockchain. Tools like Etherscan allow anyone to input a wallet address and view its entire history. While this transparency is a cornerstone of decentralization and trustless verification, it creates a unique security vulnerability.

In a traditional banking environment, a person’s net worth and transaction history are private, accessible only to the individual and the financial institution. In Web3, once a user’s wallet address is known—often through social media interactions or public NFT holdings—malicious actors can monitor that wallet in real-time. Scammers utilize automated bots to scan for "high-value targets"—wallets containing significant amounts of Ether (ETH), stablecoins, or blue-chip NFTs. By observing a user’s patterns, attackers can tailor phishing attempts or "airdrop" malicious tokens into the wallet, hoping the user will interact with them and inadvertently trigger a drainer script. This visibility necessitates a "security-first" mindset where users must assume they are being watched by opportunistic actors.

【3分でわかるWeb3.0基礎講座】セキュリティ

The Anatomy of Social Engineering: The DM and Tagging Crisis

Social engineering remains the most effective tool in the hacker’s arsenal. In the Web3 space, platforms like Discord and X (formerly Twitter) serve as the primary hubs for community engagement and project announcements. Unfortunately, they are also the primary hunting grounds for scammers.

The most common vector for these attacks is the unsolicited Direct Message (DM). Scammers often impersonate project founders, "support" staff, or automated bots, claiming that the user has won a whitelist spot, an airdrop, or is eligible for a high-yield investment opportunity. These messages almost always contain a link to a "minting" site or a "claim" portal. These sites are designed to look identical to official project pages but are embedded with malicious smart contracts.

【3分でわかるWeb3.0基礎講座】セキュリティ

Industry experts and project developers have repeatedly issued statements clarifying a fundamental rule of Web3: official projects will almost never initiate a DM to offer a prize or request sensitive information. The prevailing advice for users is to disable DMs on Discord across all crypto-related servers and to treat any "urgent" or "high-reward" notification with extreme skepticism. The psychological pressure of "Fear Of Missing Out" (FOMO) is the primary engine of these scams, and maintaining emotional discipline is as critical as any technical security measure.

Phishing and the Danger of Malicious "Approvals"

Technical exploits in Web3 often revolve around the "Approval" mechanism of smart contracts. When a user interacts with a legitimate Decentralized Exchange (DEX) like Uniswap or an NFT marketplace like OpenSea, they must grant the platform permission to "spend" or move their tokens. Malicious sites, or "drainers," trick users into signing a transaction that grants the attacker’s contract unlimited permission to transfer all assets from the user’s wallet.

【3分でわかるWeb3.0基礎講座】セキュリティ

These phishing sites are often promoted through compromised social media accounts of high-profile individuals or projects. A user might see a tweet from a trusted influencer claiming a "surprise mint" is live. They click the link, connect their wallet, and sign a transaction that looks like a standard minting fee. In reality, they have signed a "SetApprovalForAll" transaction, giving the scammer total control over their assets. Within seconds, the wallet is emptied.

To combat this, the Web3 community has developed security-focused browser extensions. Tools like Kekkai or Pocket Universe act as a firewall for the wallet. When a user is asked to sign a transaction, these extensions simulate the outcome before the user confirms. If a transaction would result in the loss of all NFTs or a transfer of funds to a known malicious address, the extension provides a red-flag warning. Integrating these "pre-sign" simulation tools is now considered a mandatory step for any active Web3 participant.

【3分でわかるWeb3.0基礎講座】セキュリティ

The Critical Necessity of "Revoking" Permissions

Many users are unaware that "Approvals" given to a smart contract remain active indefinitely unless they are manually cancelled. Even if a site was legitimate at the time of use, it could be compromised later, or the user may have accidentally interacted with a malicious contract that they didn’t realize was dangerous at the time.

"Revoking" is the process of cancelling these permissions. Blockchain explorers like Etherscan and BSCScan offer "Token Approval" tools where users can connect their wallets to see every contract that currently has permission to move their funds. If a user sees a contract they do not recognize, or one associated with a project they no longer use, they should "Revoke" that permission immediately.

【3分でわかるWeb3.0基礎講座】セキュリティ

The process of revoking is a transaction in itself, meaning it requires a small amount of "gas" (network fees) to process. While this cost can be a deterrent for some, it is a negligible price to pay for the security of the remaining assets in the wallet. Security professionals recommend a "monthly hygiene" routine where users audit their token approvals and clear out unnecessary permissions.

A Chronology of Increasing Complexity in Web3 Crimes

The evolution of Web3 security threats has followed a clear timeline of increasing sophistication.

【3分でわかるWeb3.0基礎講座】セキュリティ
  1. 2020-2021 (The Seed Phrase Era): Most scams involved "ice phishing," where scammers simply asked for the user’s 12-word seed phrase under the guise of "restoring" a wallet.
  2. 2021-2022 (The Discord Hijack Era): Hackers began targeting the moderators of Discord servers to post fake links. Users trusted these links because they came from an "official" channel.
  3. 2022-2023 (The Smart Contract Drainer Era): Attacks moved toward sophisticated "drainer" scripts that use obfuscated code to hide the fact that the user is signing away their entire wallet balance.
  4. 2024 and Beyond (AI and Deepfakes): The current frontier involves AI-generated deepfakes of project founders in video calls or voice notes to build trust before deploying a phishing link.

Data from blockchain analytics firms like Chainalysis and TRM Labs indicates that while the total volume of funds stolen in hacks fluctuates with market conditions, the number of individual phishing victims remains high. In 2023 alone, hundreds of millions of dollars were lost to "wallet drainers" utilized by organized cybercriminal groups. These groups often operate "Drainer-as-a-Service" (DaaS) models, where they provide the malicious code to low-level scammers in exchange for a percentage of the stolen loot.

Analysis: The Future of Web3 Security and User Responsibility

The decentralized nature of Web3 is its greatest strength, offering censorship resistance and financial autonomy. However, it is also its greatest weakness regarding consumer protection. In the traditional financial world, the burden of security is shared between the bank and the user. In Web3, the burden is 100% on the user.

【3分でわかるWeb3.0基礎講座】セキュリティ

This "Self-Responsibility" model creates a high barrier to entry for the general public. For Web3 to achieve mainstream adoption, security must become more intuitive. We are seeing a move toward "Account Abstraction" (ERC-4337), which allows for smarter wallets that can have "social recovery" features (allowing friends to help recover a wallet) or daily spending limits. These technical upgrades aim to bring the user experience of Web3 closer to that of traditional banking without sacrificing decentralization.

Until these technologies are universal, education remains the most potent defense. Understanding the mechanics of Etherscan, maintaining "wallet hygiene" via revoking permissions, and utilizing security extensions are not just optional extras—they are the fundamental requirements for survival in the digital economy. The "Wild West" of the internet is being tamed not by centralized authorities, but by a community of users who prioritize vigilance over convenience. As the ecosystem matures, those who master these security protocols will be the ones who successfully navigate the transition to a decentralized future.

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Japanese & Asian Crypto Markets

Asian AI Firms Challenge US Dominance as Chinas 360 and Japans Sakana AI Launch Frontier Cybersecurity Models Following Export Bans

by Suro Senen
written by Suro Senen

The landscape of global artificial intelligence has undergone a seismic shift this week as prominent technology firms in China and Japan unveiled advanced AI models designed to compete directly with high-end American software currently restricted by export controls. Chinese cybersecurity giant 360 and Tokyo-based startup Sakana AI have both released frontier-level tools that aim to fill the vacuum left by Anthropic’s Mythos and Fable 5 models. These developments come just two weeks after the United States government, under the Trump administration, implemented a sweeping ban preventing non-Americans from accessing Anthropic’s most powerful cybersecurity-focused AI tools. The move by Asian firms signals a growing trend toward "AI sovereignty," as nations seek to insulate their critical infrastructure from the volatility of international trade policy and geopolitical tensions.

On Wednesday, the Beijing-based Qihoo 360 Technology Co. (360) introduced Tulongfeng, an artificial intelligence tool specifically engineered for high-level cybersecurity applications. According to reports, Tulongfeng is positioned as a direct competitor to Anthropic’s Mythos, a model so potent that it has been designated a national security concern by U.S. regulators. Alongside Tulongfeng, 360 also debuted Yitianzhen, a model built to automate cyber defense and incident response. The dual launch underscores China’s commitment to achieving self-sufficiency in the AI sector, particularly in domains that intersect with national security and software vulnerability detection.

Earlier in the same week, Sakana AI, a rapidly rising star in the Japanese tech ecosystem, launched Fugu. Named after the Japanese blowfish—a delicacy known for its complexity and potential lethality if mishandled—the Fugu model is marketed as a "frontier" AI that stands on equal footing with Anthropic’s restricted Fable 5 and Mythos Preview models. Unlike 360’s more aggressive positioning, Sakana AI has framed Fugu as an "orchestration model" designed to coordinate multiple AI agents and manage access to various models through APIs. This architectural choice is intended to provide Japanese businesses and government agencies with a robust alternative that remains immune to the sudden imposition of foreign export restrictions.

The Regulatory Catalyst: The US Export Ban on Anthropic

The catalyst for these rapid-fire releases was a mid-June 2026 order from the U.S. government that effectively severed global access to Anthropic’s premier models. Anthropic, a San Francisco-based AI safety and research company, had been on a historic trajectory, reporting a run-rate revenue of $47 billion in May 2026 and approaching a $1 trillion valuation ahead of a highly anticipated initial public offering. However, the capabilities of its Mythos model—specifically its proficiency in identifying and exploiting software vulnerabilities—led to concerns within the Trump administration regarding the potential for the technology to be used by foreign adversaries.

The resulting ban restricted Mythos and its slightly more limited counterpart, Fable 5, to American citizens only. This decision left enterprise customers across Asia, Europe, and the Middle East without access to what was considered the gold standard in cybersecurity AI. The ban has created an immediate market opportunity for local players who can offer similar capabilities without the "country risk" associated with U.S.-based providers. For many Asian firms, the sudden loss of access served as a wake-up call, highlighting the dangers of relying on a single foreign provider for critical technological infrastructure.

Sakana AI and the Strategy of Collective Intelligence

Sakana AI’s Fugu model represents a sophisticated response to this new reality. Founded in 2023 by former Google researchers David Ha and Llion Jones, along with former Mercari and Stability AI executive Ren Ito, Sakana AI has specialized in creating generative AI models optimized for the Japanese language and culture. The company recently raised $135 million in a Series B round, bringing its valuation to approximately $2.65 billion.

While Sakana AI’s spokesperson characterized the timing of Fugu’s release as "entirely coincidental," the company has not hesitated to leverage the current geopolitical climate in its marketing. Its website now explicitly advertises "frontier capability without the risk of export controls." David Ha, the company’s CEO, argued on social media that the era of relying on massive, centralized models is giving way to a more decentralized approach. "Orchestration models are the next frontier, beyond bigger models," Ha wrote on X. He emphasized that "access to top models can disappear overnight," and that "collective intelligence is the practical hedge against this concentration of power."

Fugu is designed to act as a conductor, managing various smaller, specialized models to achieve results comparable to larger, restricted systems. This approach allows users to maintain high-level capabilities while diversifying their technological dependencies. By targeting Japanese businesses and government agencies, Sakana AI is positioning itself as the primary guardian of Japan’s digital sovereignty.

Chinas 360 and the Doctrine of Strategic AI Assets

In China, the response to the U.S. ban has been even more pointed. 360’s founder, Zhou Hongyi, has been vocal about the necessity of domestic alternatives in the AI space. Upon the unveiling of Tulongfeng, Zhou described AI-driven vulnerability detection as a "national strategic asset." He warned against the risk of "one-way transparency," a scenario where the U.S. possesses advanced tools to find flaws in global software while denying those same tools to other nations, thereby creating a profound imbalance in global cybersecurity.

Tulongfeng is built to automatically discover software vulnerabilities at a speed and scale that exceeds human capability. By matching the performance of Anthropic’s Mythos, 360 aims to ensure that Chinese enterprises and government bodies remain on the cutting edge of cyber defense. The companion tool, Yitianzhen, further strengthens this position by automating the response to cyberattacks, reducing the time between detection and remediation. Unlike the "hedge" strategy employed by Sakana AI, 360’s approach is one of direct replacement and competitive parity.

Chronology of Events Leading to the Mid-2026 AI Shift

The emergence of Tulongfeng and Fugu is the culmination of a series of events throughout 2025 and early 2026 that have redefined the global AI market:

  • Spring 2026: Sakana AI presents the underlying research for what would become Fugu at the International Conference on Learning Representations (ICLR).
  • May 2026: Anthropic reports a record-breaking $47 billion run-rate revenue, signaling its dominance in the enterprise AI market.
  • Early June 2026: The Trump administration issues an executive order citing national security concerns, banning the export of Anthropic’s Mythos and Fable 5 models to non-U.S. entities.
  • Mid-June 2026: At the G7 summit in Evian, France, AI access and export controls become a central topic of discussion. Sakana AI co-founder Ren Ito participates in diplomatic talks regarding the preservation of technology access for allies.
  • June 22, 2026: Sakana AI launches Fugu, marketing it as an export-control-free frontier model.
  • June 24, 2026: 360 unveils Tulongfeng and Yitianzhen in China, explicitly positioning them as rivals to Anthropic’s restricted tools.

Analysis of Implications and Market Realignment

The launch of these models marks a potential permanent realignment in the global AI industry. While U.S. models have historically been the preferred choice for Asian enterprises due to their advanced capabilities, the reliability of that access is now in question. Ren Ito, in an op-ed for Project Syndicate, argued that the U.S. government’s first priority should be to preserve access for its closest allies. He warned that if AI becomes a "hoarded" technology rather than a collaborative one, it will force allies to develop their own independent ecosystems, potentially leading to a fragmented global market.

The economic stakes are particularly high for U.S. firms like Anthropic. While the company’s current revenue is massive, a significant portion of future growth was expected to come from Asian markets, particularly in tech-heavy hubs like Tokyo, Seoul, and Singapore. By creating a vacuum, the U.S. export ban has effectively subsidized the growth of competitors like Sakana AI and 360. These local alternatives offer a distinct advantage beyond just availability: they are often better trained on local languages, cultural nuances, and regional regulatory requirements.

Furthermore, the concept of "AI Sovereignty" is no longer a theoretical concern but a practical business requirement. For a multinational corporation or a national government, the risk of having a critical operational tool "turned off" due to a policy change in Washington is becoming unacceptable. This sentiment is driving investment into local AI labs across the globe, from the Middle East to Southeast Asia.

Conclusion and Future Outlook

As the "AI Cold War" intensifies, the rapid response from 360 and Sakana AI demonstrates that the technological gap between the U.S. and the rest of the world may be narrower than previously thought. While Anthropic’s Mythos may currently hold a slight edge in raw performance, the arrival of Tulongfeng and Fugu suggests that the monopoly on frontier-level AI is over.

The long-term impact of the current export ban remains to be seen. If the restrictions are lifted, U.S. companies may find it difficult to regain the trust of Asian customers who have already integrated local alternatives into their workflows. For now, the momentum has shifted toward regional players who can guarantee uptime and accessibility, regardless of the political climate in the United States. The era of global AI interdependence is facing its greatest challenge yet, replaced by a new era defined by strategic autonomy and localized innovation.

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Crypto Mining & Infrastructure

Neocloud Unit Economics: The Miner’s Edge Explained

by Ammar Sabilarrohman
written by Ammar Sabilarrohman

The fundamental appeal of the neocloud model—specialized cloud providers that focus exclusively on high-performance compute for AI workloads—often relies on "napkin math" that suggests overwhelming profitability. However, detailed economic modeling reveals that for many greenfield deployments of flagship hardware like the Nvidia H100, margins are razor-thin. Interestingly, when the same hardware cluster is modeled from the perspective of an established Bitcoin miner, the economics become significantly more robust. This advantage is not merely a result of access to cheap electricity or discounted hardware; rather, it stems from the "sunk" infrastructure already in the ground and the speed with which a miner can bring that capacity online.

The Neocloud Equation and the Reality of Gross Margins

A neocloud is a streamlined cloud provider that has stripped away the ancillary services offered by hyperscalers like Amazon Web Services or Microsoft Azure to focus solely on renting compute power for AI training and inference. The business model can be reduced to a single, critical equation: total revenue equals the rental rate multiplied by utilization and total hours of operation, minus the costs of power, maintenance, fixed operating expenses, depreciation, and financing.

In industry circles, operators frequently highlight gross margins, which typically range between 55% and 65%. While these figures are impressive, they only account for revenue minus direct power and maintenance costs. The metric that dictates long-term survival is the net margin after depreciation and interest. It is in this area that many neoclouds struggle to remain solvent. The most significant lever in this equation is utilization. For debt-financed builds, which are often backed by offtake contracts, utilization is effectively 100% because the capacity is sold before the hardware is even racked. However, for self-funded operators who list GPUs on open marketplaces and assume demand risk, the break-even point typically hovers around 70% utilization. For these operators, the difference between a half-idle cluster and a fully utilized one is the difference between losing six figures monthly and achieving profitability.

Crucially, idle GPUs do not pause their depreciation. They lose value on a fixed schedule regardless of whether they are earning revenue. Sophisticated operators attempt to mitigate this by using automation to relist contracted but unused hours on the spot market at premium rates, yet the underlying economic decay of the hardware remains a constant pressure.

Historical Volatility and the Depreciation Debate

Accurately modeling a neocloud requires addressing two common errors in financial forecasting: the assumption of stable rental rates and the lack of consensus on depreciation schedules.

Neocloud Unit Economics: The Miner's Edge Explained

Historically, rental rates for high-end GPUs have been far from stable. Following the 2023 peak of the AI boom, H100 rental rates plummeted by 64% to 75% as global supply began to catch up with initial demand. This led many analysts to assume a permanent downward trajectory for rental pricing. However, by 2026, the market saw a dramatic reversal. Delays in the deployment of Nvidia’s Blackwell architecture, combined with a total sell-out of Hopper (H100/H200) capacity, caused H100 rental rates to climb approximately 20% year-over-year. One-year contract rates jumped nearly 40% from their late-2025 lows. These fluctuations prove that a model assuming a fixed decline is just as fragile as one assuming permanent growth. The rental curve and the depreciation schedule are essentially two sides of the same coin; an honest financial model must treat them as a singular, explicit bet on the asset’s economic life.

The second major point of contention is the estimated lifespan of the hardware. In late 2025, prominent investor Michael Burry argued that the economic life of an AI GPU is only two to three years, suggesting that major AI spenders were understating depreciation by as much as $176 billion for the period between 2026 and 2028. In contrast, many operators, including Meta, utilize a five-to-six-year depreciation schedule. The current shortage of Hopper chips has complicated this further, as resale values have moved in the opposite direction of what a short-life assumption would predict. Because the economic life of this hardware is so difficult to pin down, viable financial models must allow for toggling between two-, three-, and five-year lifespans to understand the potential range of outcomes.

The Bitcoin Miner’s Structural Edge

The prevailing narrative suggests that Bitcoin miners have an advantage in AI because of their access to low-cost power. While power is a factor, its impact is often overstated in the context of high-end GPU compute. At current H100 rental rates, electricity costs represent only about 3% to 4% of total revenue. A significant difference in power pricing—for instance, four cents per kilowatt-hour versus eight cents—does not fundamentally shift the profitability of the operation. Similarly, the "cheap hardware" advantage has largely vanished; as of 2026, secondary-market H100 servers trade at prices well above their levels from six months prior, and new-old-stock often sells at original MSRP.

The true, durable edge for Bitcoin miners lies in capital and time. The most expensive component of an AI data center, after the servers themselves, is the facility infrastructure. This includes the land, the building shell, the electrical build-out, cooling systems, and, most importantly, the utility interconnect. A Bitcoin miner has already paid for these elements. The interconnect is the single most difficult asset to acquire in the current AI landscape, often gated by utility queues that can last several years.

A miner transitioning to AI compute does not need to build from scratch. Instead, they fund the "delta"—the cost of upgrading an existing site designed for ASIC mining to handle the much higher rack densities and redundant power requirements of GPU deployments. While this conversion requires substantial capital for power conditioning and advanced cooling, it represents a fraction of the cost of a greenfield build.

Furthermore, the speed of deployment provides a massive competitive advantage. While a greenfield AI data center can take 18 to 30 months to become operational, a miner with existing power and space can energize a cluster in a matter of months. In a market where hardware is sold out and rental rates are rising, being the first to provide live compute is more valuable than being the cheapest builder. This reality is reflected in the multi-billion-dollar deals signed by companies like CoreWeave to take over and convert existing mining sites.

Neocloud Unit Economics: The Miner's Edge Explained

Comparative Unit Economics: Greenfield vs. Conversion

To illustrate the disparity, consider a 1,000-GPU H100 SXM cluster. The all-in capital expenditure (CapEx) per GPU, including the server, networking, shared storage, and facility costs, is estimated at $50,000 for a greenfield project. For a Bitcoin miner converting an existing site, that cost drops to approximately $42,000.

The breakdown of these costs reveals that the server (GPU and chassis), networking, and shared storage costs are identical for both operators, at approximately $30,000, $4,000, and $2,500 respectively. The entire $8,000-per-GPU gap is found in the facility line. For a greenfield build, the interconnect, shell, and electrical work cost roughly $14,000 per GPU, whereas a miner-converted site requires only about $5,000 per GPU in additional infrastructure investment.

When these figures are stress-tested against market volatility, the miner’s advantage becomes even clearer. If rental rates soften and a three-year depreciation life is applied, a greenfield cluster often compresses toward or below the break-even point because it carries significantly more facility capital to depreciate. The miner-converted cluster, however, remains profitable. This resilience is not due to cheaper silicon, but because the miner committed less new capital to the facility and began generating revenue long before the greenfield competitor could even clear the utility interconnect queue.

Operational Tensions and the Future of the Industry

Despite these advantages, the transition from mining to AI compute is not without friction. Bitcoin mining traditionally thrives on "curtailment" and demand-response programs, where the miner earns revenue by shutting down during periods of high grid stress. AI customers, conversely, demand near-100% uptime and high-reliability power. This creates a fundamental conflict: the interruptible power that makes mining profitable is incompatible with the service-level agreements (SLAs) required by AI workloads. Consequently, while a miner can convert part of a site for AI, they cannot necessarily apply the same power-saving strategies across the entire facility.

As the neocloud category matures, consolidation is inevitable. The dividing line between winners and losers will not be defined by who possesses the latest chip or the most advanced software stack. Instead, the market will favor those who started the race with infrastructure already in the ground. Energized power, existing shells, and secured interconnects are assets that cannot be conjured quickly, regardless of how much capital is available.

The structural advantage held by Bitcoin miners is significant, but it is not a guarantee of success. To capitalize on this window of opportunity, miners must model their economics with brutal honesty, accounting for the real costs of facility upgrades and avoiding overly optimistic assumptions about hardware prices or rental stability. In the current environment, characterized by a "Hopper crunch" and rising rates, the market favors the swift. The miners who can navigate the technical and financial transition today will likely become the dominant neocloud operators of tomorrow, while others remain stalled in the years-long queue for grid connectivity.

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Crypto Mining & Infrastructure

Foundry Expands Global Footprint with Institutional-Grade Zcash Mining Pool Launch Scheduled for April 2026

by Sagoh
written by Sagoh

Foundry, the industry-leading digital asset infrastructure company and operator of the world’s largest Bitcoin mining pool, has officially announced its strategic expansion into the Zcash ecosystem with the upcoming launch of a dedicated mining pool. Scheduled to go live in April 2026, this new initiative is specifically engineered to cater to the stringent requirements of institutional investors, public companies, and large-scale enterprise miners. By leveraging the same robust architecture that propelled Foundry USA to the top of the Bitcoin mining hierarchy, the company aims to address a long-standing deficit in professional-grade infrastructure for privacy-centric digital assets.

The move marks a significant milestone for Zcash (ZEC), a cryptocurrency that has spent years establishing its utility as a privacy-preserving financial layer but has often lacked the centralized, compliant mining portals required by major financial institutions. According to Foundry CEO Mike Coyler, the decision to enter the Zcash market was driven by the observation that while ZEC has matured into an asset capable of sitting on institutional balance sheets, the underlying mining infrastructure has struggled to keep pace with this evolution. The April 2026 launch is positioned as a corrective measure to bridge this gap, offering a North American-based, transparent, and highly efficient solution for the ZEC mining community.

The Strategic Dominance of Foundry in the Mining Landscape

To understand the weight of this announcement, one must look at Foundry’s current standing within the global cryptocurrency ecosystem. A subsidiary of Digital Currency Group (DCG), Foundry has become synonymous with the industrialization of Bitcoin mining in North America. Its flagship product, Foundry USA Pool, currently commands a plurality of the global Bitcoin hashrate, often fluctuating between 25% and 30% of the total network power.

Foundry’s success is built upon a foundation of "institutional-grade" service, which includes rigorous KYC (Know Your Customer) and AML (Anti-Money Laundering) compliance, transparent reporting, and high-uptime infrastructure. By bringing these standards to Zcash, Foundry is effectively signaling that privacy-preserving technologies are no longer the exclusive domain of retail enthusiasts or cypherpunks, but are ready for mainstream corporate integration.

A mining pool acts as a hub where individual miners combine their computational resources—known as hashrate—to increase the statistical probability of solving a block and receiving a reward. In the highly competitive world of Proof-of-Work (PoW) mining, solo mining is increasingly unfeasible for all but the largest operations. By providing a centralized pool for Zcash, Foundry offers a stabilized revenue stream for participants, which is a critical requirement for public companies that must report predictable earnings to shareholders.

Bitcoin Mining Giant Enters Zcash With Institutional Service

Zcash: The Intersection of Privacy and Compliance

Launched in 2016, Zcash was born out of a desire to improve upon Bitcoin’s lack of inherent transaction privacy. While Bitcoin is often perceived as anonymous, it is more accurately described as pseudonymous; every transaction is recorded on a public ledger, and with modern blockchain forensics, these transactions can frequently be linked to real-world identities. Zcash addressed this by implementing "Zero-Knowledge Succinct Non-Interactive Arguments of Knowledge," or zk-SNARKs.

This sophisticated cryptographic tool allows users to prove they have the funds for a transaction without revealing the sender, the receiver, or the amount involved. However, Zcash also includes "transparent" addresses that function similarly to Bitcoin, providing a hybrid model that allows for both total privacy and selective disclosure. It is this specific feature—the ability to be private by default yet auditable when necessary—that Foundry highlights as the catalyst for institutional interest.

The Zcash codebase is a fork of Bitcoin, meaning it shares several fundamental economic properties. It has a hard supply cap of 21 million tokens and undergoes "halving" events approximately every four years, which reduce the rate at which new tokens are issued. This scarcity model is a primary driver of its value proposition as "digital gold with a privacy layer."

Analyzing the Recent Surge in Zcash Network Hashrate

Foundry’s expansion comes at a time of renewed vitality for the Zcash network. Recent data from BitInfoCharts reveals a significant upward trajectory in the network’s total computing power. In October of the previous year, the Zcash hashrate was struggling to maintain levels above 8 Ghash/s. As of the latest reporting period, that figure has surged to over 13 Ghash/s, representing a nearly 60% increase in network security and miner participation in just a few months.

Several factors contribute to this growth:

  1. Hardware Efficiency: The release of new, more efficient Application-Specific Integrated Circuit (ASIC) miners tailored for the Equihash algorithm (which Zcash uses) has allowed miners to generate more hashrate with less power consumption.
  2. Network Upgrades: Recent protocol improvements have enhanced the scalability and speed of shielded transactions, making the network more attractive to users.
  3. Institutional Anticipation: The "Foundry Effect" often leads to increased activity as miners position themselves ahead of major infrastructure launches.

The rise in hashrate is a trailing indicator of miner confidence. When miners invest in new hardware and commit electricity to a network, they are essentially betting on the long-term viability and price appreciation of the underlying asset. Foundry’s entry into the space is expected to further catalyze this trend, potentially pushing the hashrate to all-time highs by the 2026 launch date.

Bitcoin Mining Giant Enters Zcash With Institutional Service

Official Responses and the Role of Shielded Labs

The announcement has been met with enthusiasm from the core developers and support organizations within the Zcash ecosystem. Zooko Wilcox, the founder of Zcash and currently the Chief Product Officer at Shielded Labs, emphasized the importance of geographic and institutional diversity in mining.

"We at Shielded Labs are delighted that Foundry—the largest Bitcoin mining pool, and one based in North America—is launching an enterprise-grade Zcash mining pool," Wilcox stated. He noted that the presence of a major U.S.-based operator provides a level of legitimacy and security that is vital for the next phase of Zcash’s growth.

Shielded Labs, an independent organization based in Switzerland, serves as a critical pillar for the Zcash community, focusing on research, development, and the promotion of privacy-preserving technologies. The collaboration between a Swiss-based development entity and a U.S.-based infrastructure giant illustrates the increasingly global and professionalized nature of the privacy coin market.

Market Performance and Economic Outlook

Despite the positive infrastructure news, Zcash has faced the same volatility as the broader cryptocurrency market. At the time of the announcement, ZEC was trading at approximately $209, reflecting an 11% decline over the previous week. This retracement follows a period of recovery and highlights the "buy the rumor, sell the news" phenomenon often seen in digital asset markets.

However, analysts suggest that the long-term price action of ZEC may be decoupled from short-term fluctuations as the 2026 pool launch approaches. The entry of institutional miners typically leads to "stronger hands" holding the asset, as these entities are less likely to engage in panic selling compared to retail miners. Furthermore, the 2026 timeline aligns with broader cycles in the crypto market, potentially coinciding with post-halving supply crunches across several PoW assets.

Broader Implications for the Mining Industry and Privacy

The launch of the Foundry Zcash pool carries implications that extend far beyond a single cryptocurrency. First, it challenges the regulatory narrative that privacy coins are inherently incompatible with regulated financial systems. By providing a compliant gateway for ZEC mining, Foundry is demonstrating that "financial privacy and compliant digital infrastructure can coexist."

Bitcoin Mining Giant Enters Zcash With Institutional Service

Second, it signals a shift in the mining industry toward diversification. As the Bitcoin mining difficulty continues to climb to record highs, large-scale operators are looking for secondary and tertiary assets to mine to hedge their bets. Zcash, with its established brand, proven technology, and similar economic model to Bitcoin, is a logical choice.

Finally, the April 2026 launch date suggests that Foundry is taking a measured, long-term approach to development. Building a pool that meets the audit and security standards of public companies requires extensive testing and regulatory coordination. This timeline indicates that the industry is moving away from the "move fast and break things" ethos toward a more mature, "build to last" philosophy.

As the countdown to April 2026 begins, the Zcash community and the wider mining industry will be watching closely. If Foundry can replicate its Bitcoin success within the privacy sector, it could redefine the role of privacy coins in the modern financial portfolio, transforming Zcash from a niche privacy tool into a cornerstone of institutional digital asset strategies.

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Crypto Mining & Infrastructure

Trump-Backed American Bitcoin Set to List on Nasdaq via Merger With Gryphon Digital Mining as Firm Targets Global Expansion

by Jia Lissa
written by Jia Lissa

American Bitcoin, a cryptocurrency mining enterprise backed by Eric Trump and Donald Trump Jr., is finalizing its transition into the public markets through an all-stock merger with Gryphon Digital Mining. The move, which marks a significant intersection of high-level American political figures and the digital asset industry, aims to establish the company as a dominant force in the global mining landscape. According to a report by Reuters and statements made by Hut 8 CEO Asher Genoot, the merger is expected to conclude in the coming weeks, with the newly formed entity targeting a debut on the Nasdaq exchange in early September 2025. The company will trade under the ticker symbol ABTC, signaling its intent to become a primary vehicle for institutional and retail exposure to Bitcoin mining.

The strategic decision to utilize an all-stock merger with Gryphon Digital Mining—a firm already familiar with the rigors of public listing requirements—reflects a desire for speed and capital flexibility. Asher Genoot, whose firm Hut 8 holds an 80% stake in American Bitcoin, emphasized that this route was chosen over a traditional initial public offering (IPO) to provide the company with immediate access to a broader range of financing options. This maneuver allows American Bitcoin to bypass some of the lengthy lead times associated with the IPO process while inheriting the regulatory framework already established by Gryphon.

Strategic Partnership and Ownership Structure

The ownership architecture of the post-merger entity highlights a consolidated power base. Hut 8 and the Trump brothers are slated to collectively own 98% of the company, ensuring that the strategic direction remains firmly in the hands of its founders and its primary industrial backer. Hut 8, a veteran in the North American mining sector, will retain a majority interest, providing American Bitcoin with the technical expertise and operational infrastructure required to scale rapidly in an increasingly competitive environment.

The venture has also attracted significant interest from high-profile figures within the cryptocurrency industry. Anchor investors include Tyler and Cameron Winklevoss, the founders of the Gemini exchange and early Bitcoin pioneers. Their participation adds a layer of "crypto-native" credibility to the project, bridging the gap between the traditional business influence of the Trump family and the established digital asset ecosystem. While Gemini has not provided official commentary on the specifics of the investment, the inclusion of the Winklevoss twins suggests a robust confidence in the firm’s ability to navigate the complexities of the current market.

A Vision for Global Dominance and "Pure-Play" Mining

Founded in March 2025, American Bitcoin has articulated an ambitious mission: to become the world’s largest and most efficient "pure-play" Bitcoin miner. This designation is crucial in the current market context. While many of its competitors, such as Marathon Digital Holdings and Riot Platforms, have begun diversifying their operations into high-performance computing (HPC) and artificial intelligence (AI) data centers to hedge against Bitcoin’s volatility, American Bitcoin is doubling down on its core mission.

The company’s strategy involves a two-pronged approach to asset accumulation. First, it intends to leverage cutting-edge hardware and low-cost energy solutions to maximize its hash rate and mining output. Second, the firm plans to engage in direct purchases of Bitcoin to bolster its balance sheet, a strategy popularized by firms like MicroStrategy. By focusing exclusively on Bitcoin, the company aims to offer investors a direct correlation to the performance of the world’s largest cryptocurrency without the "dilution" of other business lines.

International Expansion: The Asian Pivot

A key component of American Bitcoin’s growth strategy is its focus on international markets, specifically within Asia. During the Bitcoin Asia conference in Hong Kong, Asher Genoot revealed that the company is actively exploring acquisitions in Hong Kong and Japan. This expansion is designed to diversify the firm’s geographic footprint and mitigate the risks associated with the evolving regulatory landscape in the United States.

In Japan, the company is seeking synergies with Metaplanet, a Tokyo-listed firm that has gained notoriety as the "MicroStrategy of Japan" due to its aggressive Bitcoin treasury strategy. Eric Trump’s scheduled travel to Tokyo for an event hosted by Metaplanet underscores the high-level diplomatic and business outreach being conducted to secure a foothold in the Japanese market.

Genoot explained that investing in firms outside the United States is a strategic move to provide global investors with access to publicly listed Bitcoin assets in jurisdictions where access to Nasdaq-listed stocks may be restricted or less efficient. By establishing a presence in Hong Kong—a city that has recently introduced a comprehensive regulatory framework for digital assets—American Bitcoin positions itself to capture capital from the broader Asian market.

Chronology of the Venture

The timeline of American Bitcoin’s ascent is notably rapid, reflecting the accelerated pace of the current crypto bull cycle and the political momentum surrounding the industry.

  • March 2025: American Bitcoin is officially founded, with backing from the Trump family and strategic partnership from Hut 8.
  • May 2025: The company begins scouting for merger partners to facilitate a public listing.
  • August 2025: Details of the merger with Gryphon Digital Mining are finalized. Asher Genoot announces the intent to trade on the Nasdaq by September.
  • Late August 2025: Eric Trump and Asher Genoot attend Bitcoin Asia in Hong Kong to signal international expansion plans.
  • September 2025 (Target): Closing of the merger and commencement of trading under the ticker ABTC.

This timeline suggests a highly coordinated effort to capitalize on the current administration’s favorable stance toward the domestic mining industry.

Regulatory Context and Potential Conflicts of Interest

The emergence of a major Bitcoin mining firm backed by the family of a sitting or former president has not been without controversy. Critics and ethics watchdogs have raised concerns regarding potential conflicts of interest. The Bitcoin mining industry is heavily dependent on federal energy policies, environmental regulations, and the oversight of the Securities and Exchange Commission (SEC).

Opponents argue that the Trump family’s involvement in a publicly traded mining company could create a scenario where administrative decisions—such as energy subsidies or crypto-friendly executive orders—directly benefit the private financial interests of the First Family. Proponents, however, view the venture as a testament to the "American-made" Bitcoin movement, arguing that it aligns with a broader national strategy to ensure the United States remains the global leader in digital asset innovation and hash rate production.

Market Implications and the Future of ABTC

The listing of American Bitcoin comes at a pivotal moment for the mining sector. Following the most recent Bitcoin halving, miners have faced increased pressure to improve efficiency as block rewards were cut in half. The entry of a well-capitalized, politically connected firm like American Bitcoin could trigger a new wave of consolidation in the industry.

If American Bitcoin successfully executes its plan to acquire distressed or undervalued mining assets in Asia, it could significantly alter the distribution of global hash rate. Furthermore, the "pure-play" nature of the company may attract institutional investors who are looking for a high-beta play on Bitcoin’s price without the operational complexities of managing physical wallets or private keys.

As the September trading date approaches, market analysts will be closely watching the valuation of the merger. The success of ABTC will likely depend on its ability to secure low-cost power contracts and maintain a high uptime for its mining rigs. With the backing of Hut 8’s operational expertise and the brand recognition of the Trump name, the firm is positioned to be one of the most talked-about listings in the fintech sector this year.

In conclusion, the merger between American Bitcoin and Gryphon Digital Mining represents more than just a corporate transaction; it is a bold statement on the future of the American crypto industry. By combining political influence, veteran mining expertise, and a clear-eyed focus on global expansion, American Bitcoin aims to redefine what it means to be a publicly traded digital asset powerhouse. Whether it can overcome the ethical scrutiny and operational challenges of the mining world remains to be seen, but its arrival on the Nasdaq will undoubtedly mark a new chapter in the institutionalization of Bitcoin.

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