Why Did Bitcoin Fall on News That Didn’t Actually Change Anything?

Bitcoin touched a four-month high of $82,240 midweek, then fell back below $80,000 after August’s US jobs report landed on Friday. The economy added 162,000 jobs, roughly three times what economists expected. Normally, a number that strong makes a rate hike more likely, and traders reacted exactly as if that had just happened.

Except it had not, not really. The odds of the Federal Reserve raising rates at its September meeting sat at 58% the day the jobs report came out. Those same odds had been sitting at 58% for the entire week beforehand too. The genuine shift in expectations happened the week before, when new Fed Chair Kevin Warsh gave the hawkish Jackson Hole speech we covered last week. Friday’s jobs number did not tell traders anything new about what the Fed is likely to do. It just reminded everyone of something they already knew, and spot markets reacted with fresh panic to old information.

That distinction matters if you are trying to make sense of the price chart. A market reacting to genuinely new information tends to hold its new level. A market reacting emotionally to a reminder of something already priced in tends to drift back once the mood passes. Which one this turns out to be should become clear fast, with US inflation data landing September 11 and the Fed’s actual decision following just days later.

The Biggest Bitcoin Hack Nobody Fully Agrees Was a Hack

The single largest Bitcoin-related security event of the year happened this week, and it is genuinely more complicated than a simple theft. Around $320 million was drained from the Liquid Network, a system run by Blockstream that banks and exchanges use to settle Bitcoin transactions faster and more privately than the main network allows.

Worth being precise about what broke. This was not a flaw in Bitcoin itself. Liquid is a separate side system, and the bug sat in software called Elements that handles Liquid’s privacy features. Whoever found it did not steal any private keys and did not compromise the hardware securing the network. They found a software bug and used it.

What happened next is the unusual part. The people who took the funds identified themselves publicly as white hats, hackers who break in to expose a flaw rather than to simply steal, and said they would return the money once the bug was properly fixed. Within about two days, they sent back 3,400 of the roughly 4,000 Bitcoin taken. They kept 598.5 Bitcoin, worth about $47 million, describing it as a bounty they had awarded themselves for finding the flaw. Nobody asked them to set that price. The network remains paused while Blockstream and its partners fix the underlying bug and prepare to bring it safely back online.

The Clarity Act’s Odds Have Collapsed

We have followed the Clarity Act, the bill meant to finally settle how crypto is regulated in America, for months now. This week brought the clearest sign yet that it may not make it. The bill faces what is called a cloture vote in the Senate on September 15, a procedural step that exists specifically to stop a small group of senators talking a bill to death rather than letting it come to an actual vote. Cloture needs 60 votes to succeed, a much higher bar than the simple majority needed to pass the bill itself once debate is allowed to end. Republicans hold 53 seats, and only two Democrats backed the bill when it went through committee.

The sticking points have not really changed: whether stablecoins should be allowed to pay yield, which banks oppose, how much legal responsibility software developers should carry for how their code gets used, and rules restricting elected officials from holding crypto while writing the laws that govern it. What has changed is the calendar. The House has now cancelled two more of its remaining September sitting days, leaving barely a handful of working days before Congress breaks for the run-up to the midterms. Betting markets tracking the odds of the bill actually becoming law this year have fallen from 82% back in February to under 20% now.

If cloture fails on the 15th, the realistic path forward closes for the year. A new Congress in 2027, potentially with a different party controlling the House, would likely mean starting the whole process again from scratch.

Strategy’s Comeback Buy Is Already Underwater

We told you last week that Strategy had ended its ten-week pause, buying 4,603 Bitcoin for $370 million at an average of $80,318 a coin. This week added an important detail we did not have before. During that ten-week pause, Strategy was not simply sitting still. It sold roughly 7,000 Bitcoin between March and August to help fund its preferred stock dividends, a real departure from the company’s long-standing promise to never sell.

There is also a simple, slightly awkward postscript. Bitcoin has since traded below $80,318, meaning Strategy’s comeback purchase is underwater within days of being made. None of this changes the company’s enormous underlying position. It does mean the “we’re back” narrative from last week deserves a more honest second look than it got at the time.

Quick Hits

Institutions kept buying even as the price fell. US Bitcoin ETFs took in almost a billion dollars over the week, including the single biggest day since January, even while Bitcoin itself was falling. That is a genuinely useful signal: professional money was adding to positions at exactly the moment retail sentiment was souring, which has repeatedly put a floor under this market over the past two years.

Oil is surging as the Iran conflict widens. Continued fighting near the Strait of Hormuz pushed the price of Brent crude oil toward $100 a barrel this week, with US diesel hitting a record price at the pump. This is the same story we have followed for months: an energy shock is exactly the wrong backdrop for a Fed already leaning toward higher rates, because expensive oil feeds straight into the inflation numbers the Fed watches most closely.

A crypto-native bank just got unusually close to full approval. US banking regulators gave preliminary approval to OpenReserve, a company backed by venture firm a16z, to become a genuine full-service national bank rather than the more limited licence most crypto firms have settled for. If finalised, it would let the company hold insured deposits, lend conventionally, and settle payments directly through the Fed’s own network around the clock, rather than only during normal banking hours.

The Bitcoin treasury company story keeps getting messier. Metaplanet shares fell 17% this week after shareholders revolted over a huge expansion of executive stock options and questions about the CEO’s ties to one of its own investors. Separately, the index provider MSCI is still consulting on whether to exclude companies like Strategy and Metaplanet from its stock indices altogether for holding too much Bitcoin relative to their actual business. That consultation closes at the end of September, exactly as we told you a couple of weeks ago.

US inflation data lands September 11, the Clarity Act faces its Senate test on September 15, and the Fed announces its rate decision the following day. I’ll cover all three the moment there is real news. Make sure you’re subscribed.

And Finally…

Hunter Biden Is Launching a Memecoin Called $LAPTOP

Hunter Biden announced this week that he is launching his own memecoin, named after the infamous laptop that dominated years of American political news, and explicitly aimed at people currently holding the Trump family’s own memecoin, which is down roughly 97% from its highs. Whatever else can be said about it, launching a coin named after your own most-litigated piece of personal property is a genuinely committed piece of trolling.

$240 Million in Stolen Bitcoin Bought a Lot of Very Bad Decisions

Court filings from the ongoing case against 22-year-old Malone Lam, accused of stealing more than $240 million in Bitcoin from a single victim, gave the public an itemised look at where the money went: a $569,000 single night at a Los Angeles nightclub, a $2 million watch, more than thirty supercars, and mansions in Miami and the Hamptons. One associate reportedly bought his parents a Lamborghini and hid $500,000 in cash inside a washing machine. A judge overseeing the case reportedly summed the whole thing up as “Ferris Bueller gone bad,” which is hard to improve on.

Quick Questions

Q: Did the jobs report actually cause the Fed to become more likely to hike rates?

A: Not really, that shift had already happened the week before, after Fed Chair Kevin Warsh’s Jackson Hole speech. The jobs report confirmed the existing picture rather than changing it, even though Bitcoin’s price reacted as if something new had happened.

Q: Was the Liquid Network hack a problem with Bitcoin itself?

A: No. Liquid is a separate system built on top of Bitcoin, and the bug was in software specific to that system. Bitcoin’s own network was never at risk.

Q: Is the Clarity Act definitely dead if it fails on September 15?

A: Not definitely, but the realistic window closes for this year. A new Congress in 2027 would likely need to restart the process from the beginning, which is why this specific vote matters so much.

Why Did Bitcoin’s Rally Suddenly Stall?

We told you last week that Bitcoin’s biggest weekly gain in history was really a reaction to the US Treasury quietly stepping in to manage its own borrowing costs, a signal that markets read as a sign easier money was on the way. That assumption held for exactly one week.

On August 28, new Fed Chair Kevin Warsh gave his first major speech since taking the job, at the Fed’s annual Jackson Hole gathering. He said the 2% inflation target is “a firm, fixed target,” and with inflation still running at 3.7%, the Fed has “work to do.” Just as pointedly, he declined to endorse the Treasury’s bond buyback programme, the exact mechanism that had powered the rally we wrote about last week. Markets took the hint. Odds of a rate cut in September, which had been the working assumption, collapsed to almost nothing. Odds of a rate hike instead jumped from around 41% to roughly 60% in a matter of days.

Bitcoin, which had run from around $62,000 to above $81,000 on the back of that liquidity story, gave back ground and closed the week near $78,000. Crypto-related shares fell harder. Strategy’s stock dropped 6.5% on the day, Coinbase 5.4%. Until the Fed meets again on September 16, Bitcoin is trading the Fed’s next move, not much else.

The Streak That Broke on the Same Day

US Bitcoin ETFs had just put together their best run of the year, nine straight days of inflows worth roughly $2.8 billion, pushing August to more than $3 billion overall, the strongest month of 2026. That streak snapped the same day Warsh spoke, with $201.8 million pulled out in a single day. Buying resumed within a few days, but the timing was not a coincidence.

One detail is worth knowing if you are trying to gauge how broad this demand really is. Roughly 72% of that entire nine-day streak went into a single fund, BlackRock’s IBIT. When almost three quarters of the buying comes from one place, “ETF demand” and “IBIT demand” are close to being the same sentence. It does not make the demand less real. It does mean the story is less diversified than the headline number suggests.

Strategy Bought Again. The Bigger Story Is How.

Michael Saylor’s Strategy ended its ten-week pause this week, the one we covered when the company built a cash pile instead of buying the dip. It bought 4,603 Bitcoin for $369.7 million, taking its total holdings to 845,050 coins, worth roughly $66 billion and more than 4% of every Bitcoin that will ever exist. Saylor marked the return on social media with his usual line about painting the bears orange.

The purchase is the headline. The mechanism behind it is the part worth understanding. Strategy funds its Bitcoin buying by issuing new shares, and that only benefits existing shareholders when those shares trade meaningfully above the value of the Bitcoin the company actually holds. Back in 2024 and 2025, that premium regularly ran at two to three times the underlying value. This week it had compressed to just 1.03 times, essentially at parity. The engine that has driven Strategy’s buying for years is running on fumes, not because Saylor has changed his mind, but because the market is no longer willing to pay much of a premium for what the company does.

Zoom out further and the picture gets starker. Across every publicly listed Bitcoin treasury company combined, including Strategy’s own purchase, the entire sector added a net 16 Bitcoin this week. ETFs alone bought roughly $843 million worth over the same period. The buying that once came from ambitious public companies has almost entirely shifted to passive funds instead.

Quick Hits

A US court just complicated who regulates crypto prediction markets. A federal appeals court ruled that Nevada’s state gambling laws can apply to Kalshi’s prediction markets, rejecting the argument that federal commodities law alone should govern them everywhere. A regulator spokesperson admitted this creates a split between courts that likely needs the Supreme Court to resolve. The same underlying question, whether one federal regulator or fifty separate state regimes should govern crypto-adjacent products, sits underneath plenty of other crypto derivatives too.

Iran’s entire crypto sector is now a sanctions target. We told you two weeks ago that Iran-linked crypto activity was drawing sanctions. This week the US went further, formally naming Iran’s digital asset sector itself as sanctionable, the first time any country’s crypto industry has been designated that way as a whole. Around 60 people, companies and vessels were sanctioned at the same time. In practice, this means any exchange or broker anywhere in the world doing meaningful business with Iranian crypto platforms now risks US sanctions too, not just people dealing with specific named individuals.

Russia’s new crypto law officially took effect. The law Russia signed earlier this summer came into force this week, legalising regulated Bitcoin, Ether and USDT trading while keeping a ban on using crypto to actually pay for goods. Russia’s largest bank, state-controlled Sberbank, is forecasting around $46 billion of regulated trading volume in the first year alone, and plans to offer loans secured against Bitcoin pending approval. A sanctioned economy building a supervised path into Bitcoin, in the same fortnight the US widened sanctions on Iran’s crypto sector, tells you plenty about how unevenly this technology is being treated around the world.

The UK published its first real numbers on crypto wealth. Britain’s tax authority revealed that 17,600 people declared a combined £1.38 billion in crypto gains for the 2024 to 2025 tax year. Just 240 of those people accounted for £717 million of it, over half the entire total. If you are wondering who capital gains reporting rules like this are really designed to catch, that concentration is your answer. Separately, the UK plans to give the Bank of England a formal mandate to support innovation in stablecoins, a genuine shift in tone from a regulator that has been openly cautious about the sector.

Another Blockchain Hit Undo

An attacker manipulated the price of a token used as loan collateral on Crypto.com’s Cronos network, inflating it roughly a hundredfold in twenty minutes before borrowing heavily against it and draining about $74 million. The response was the notable part. Validators halted the entire network and rewound it back to before the attack happened, effectively deleting the exploit from history. It is the same manoeuvre we wrote about a few weeks ago when Ravencoin and Harmony did something similar. A network able to vote to rewrite its own recent past is a fundamentally different kind of system to Bitcoin, where no such vote is even possible. Two smaller platforms, Moonwell and More Markets, suffered nearly identical collateral manipulation attacks in the same week, which suggests this is a pattern other projects need to fix, not a one-off.

The next Fed decision lands September 16, and the Clarity Act’s Senate vote is scheduled for September 15, one day before it. I’ll cover both the moment there is real news. Make sure you’re subscribed.

And Finally…

George Santos Bet on Whether He Would Show Up. Then Tried to Fix the Result.

Prediction market Kalshi handed out the first lifetime ban in its history this week, to former congressman George Santos. He had placed a bet on a market asking whether he would attend the State of the Union, then made public statements, some of them reportedly false, apparently designed to move the price of a market whose outcome only he controlled. He made just under $18,000 doing it and was fined roughly $71,000. Somehow, betting on your own future behaviour and then trying to influence it counts as market manipulation rather than just having a plan.

A Billionaire Asked a Chatbot for Relationship Advice. It Did Not Go Well.

Crypto entrepreneur Justin Sun published a 10,000-word account this week alleging a dispute over a surrogacy arrangement, revealing along the way that he had consulted an AI chatbot for advice, followed its recommendation, and afterwards admitted he was still not entirely sure the AI had been right. The other party denied the entire story, and Sun later suggested parts of his own account may have been fictional. Even by crypto’s standards, that is an unusually honest way to describe taking relationship advice from a chatbot.

Quick Questions

Q: Did Bitcoin actually fall this week, or just stop rising?

A: Mostly the second. Bitcoin gave back some of its gains after touching above $81,000, closing the week near $78,000, roughly flat overall rather than down sharply.

Q: Does Strategy’s mNAV compressing to 1.03 mean the company is in trouble?

A: Not in any immediate sense, it still holds over 845,000 Bitcoin. It does mean the specific method Strategy uses to fund new purchases, issuing shares at a premium, has far less room to work with than it used to.

Q: Should I be worried about Bitcoin after a network rollback like Cronos?

A: No, that happened on a completely different network with a different design, not on Bitcoin itself. Bitcoin has never had a rollback like this in its history, and its rules make one essentially impossible.

Why Did the US Government Suddenly Start Buying Its Own Bonds Back?

On August 19, the US Treasury announced it would more than double a programme that buys back older government bonds, taking it from $2 billion to at least $4 billion per operation starting in September. The reason: the interest rate on 30-year US government debt had just hit 5.34%, its highest level since 2007, and investors had largely stopped showing up to buy new long-term US debt since late June. When a government cannot sell its debt at a rate it can afford, it has to do something. This was that something.

It worked, in the narrow sense that yields fell within hours of the announcement. It is worth understanding why serious economists are not celebrating it, though.

Why Economists Are Calling This a Warning Sign

Government bonds work like this. The government borrows money for a fixed number of years and pays interest on it. When plenty of investors want to lend the government money, the interest rate stays low. When investors get nervous, either about inflation or about how much debt a government is piling up, they demand a higher rate to compensate, or they simply stop buying. That second scenario, sometimes called a buyers’ strike, is what had been building in the market for 10 to 30-year US bonds since late June.

Faced with that, the Treasury essentially became its own biggest customer. Deutsche Bank’s George Saravelos described the move as a sign of “increasing administration unease” about rising long-term borrowing costs. Economist Mohamed El-Erian went further, calling it an early step toward something known as yield curve control, where a government or central bank directly intervenes to cap its own borrowing costs rather than letting the market set them. Historically, that kind of intervention shows up when a government is struggling to fund itself through ordinary demand, not when everything is running smoothly. President Trump, asked directly whether Americans should be worried, said “No, I don’t think so.” Yields crept back up again within a day of the announcement regardless.

None of this means a crisis is imminent. But it is a genuinely different story to “markets had a great week,” and it is the real reason this week’s Bitcoin rally is worth understanding properly rather than just celebrating.

Why Bitcoin Rallies on Bad News for the Dollar

Here is the connection that matters. When a government has to step in and manage its own debt costs directly, the eventual result tends to be more money printed and looser policy down the line, because that is usually the easier path politically than either raising taxes or cutting spending. That prospect, more dollars chasing the same amount of stuff, tends to push investors towards assets that cannot simply be printed. Gold has played that role for a century. Bitcoin, with a supply permanently capped at 21 million coins, is increasingly playing it too.

That is the real backdrop to Bitcoin gaining $14,264 in a single week, the largest dollar gain in its history, closing at $77,387 and pushing past $80,000 the next day. Worth being honest about scale, though: Bitcoin remains roughly 37% below the all-time high of $126,198 it reached last October. This was a serious recovery from a beaten-down price. It was not a new record.

The Mechanics Behind the Move

Two things happened on top of the bond market signal, and they are worth telling apart because they mean different things.

The first was mechanical. Traders who had bet against Bitcoin were suddenly proven wrong, and exchanges forced them to close those bets automatically. Short sellers lost $2.74 billion in a single day, a record, with more than a billion dollars of positions closed in roughly an hour. Moves like this tend to run out of fuel once the forced buying finishes, because no genuine new demand created it.

The second was not mechanical at all. US Bitcoin ETFs took in $1.92 billion over the week, the strongest week since October last year. That money represents ordinary investors and advisers actively choosing to buy, not being forced to. BlackRock’s IBIT fund alone brought in the majority of it. Between the two, the ETF flows are the more meaningful signal that this rally has genuine substance behind it, not just a squeeze that will fade.

The SEC Finally Showed Its Hand

Away from the bond market, there was a genuine regulatory step forward this week too. The SEC formally proposed Regulation Crypto Assets, giving crypto companies two clear paths to legally raise money from investors. Smaller projects can raise up to $5 million over four years with light paperwork. Larger ones can raise up to $75 million a year if they agree to publish proper financial reports.

The detail that matters most long term is quieter than either number. The rule also stops individual US states from layering their own separate registration requirements on top of federal ones, which has made compliant token sales genuinely impractical for years. SEC Chair Paul Atkins called it a step to help crypto innovation flourish, while admitting a rule made by one SEC can be undone by the next one. That is exactly why the industry keeps pushing for a proper law instead. The very next day, President Trump hosted crypto executives at the White House and publicly pushed Congress to pass the Clarity Act, the bigger bill that would make rules like this permanent.

Meanwhile, Strategy Sat This One Out

Strategy, the company that has spent years building its identity around buying Bitcoin, raised $2 billion this week and put none of it toward Bitcoin. The money went into cash reserves and a preferred stock buyback instead. Its holdings sit exactly where they were, at 840,447 coins. Across August the company has raised $3.28 billion and now sits on $6.69 billion in cash.

There is a real reason behind it. Strategy’s share price currently trades almost exactly in line with the value of its Bitcoin holdings. When shares trade above that value, issuing new shares to buy more Bitcoin makes existing shareholders richer. At parity, it no longer does. Saylor appears to be waiting for that gap to reopen. Strive, a smaller rival, took the opposite approach this week, buying 1,110 Bitcoin while Strategy bought none.

Quick Hits

Iran’s crypto industry is now a sanctioned target. The US Treasury designated nearly 60 people, companies and vessels linked to Iran, and for the first time formally named crypto itself as a sanctionable part of Iran’s economy. That gives US authorities a standing basis to sanction any exchange or platform found helping Iran move money through crypto, anywhere in the world, without building a fresh case each time.

Visa and Mastercard are fighting over stablecoins. Visa is searching for a new partner to handle stablecoin payments after Mastercard bought its previous partner, BVNK, for up to $1.8 billion. Both of the world’s biggest card networks now clearly see moving stablecoins as core business rather than a side experiment.

A DeFi lender lost $8.5 million despite having safeguards. Term Finance, a lending platform built on Ethereum, was drained of roughly $8.5 million through a flaw in its own governance system. The safeguards meant to prevent exactly this, a waiting period and a veto right, both existed and both failed.

The next major catalyst is Kevin Warsh’s first speech as Fed Chair at the Jackson Hole symposium, running August 27 to 29. I’ll cover it the moment there is real news. Make sure you’re subscribed.

And Finally…

An Exchange Banned Its Own Staff From Using Claude

Crypto exchange OKX banned its Hong Kong staff from using Anthropic’s Claude after Anthropic suspended the exchange’s account. The genuinely surprising detail was not the ban itself, it was OKX revealing it spends somewhere between $6 million and $8 million a month on AI tools. That is a lot of chatbot subscriptions for a crypto exchange.

Quick Questions

Q: Why would Bitcoin go up because of a problem in the bond market?

A: Because the usual fix for a government struggling to borrow is to eventually create more money, and that risk of currency debasement is exactly what makes a fixed-supply asset like Bitcoin more attractive to some investors, not less.

Q: Is Bitcoin at a new all-time high?

A: No. Despite the biggest weekly gain in its history, Bitcoin is still roughly 37% below the record of $126,198 it reached in October 2025. This was a strong recovery, not a new peak.

Q: Should I be worried that Strategy did not buy Bitcoin this week?

A: Not especially. The company still holds its full 840,447 Bitcoin unchanged. It has paused new purchases while its own share price sits at a level where buying more would not currently benefit existing shareholders.

Why Did the Buyers Suddenly Disappear?

Last week we told you retail investors had stopped watching Bitcoin altogether, while institutions kept quietly buying anyway. That gap was the whole story. This week, the second half of that story broke down too.

US Bitcoin ETFs handed back $390 million over the week, their worst run in six weeks. That alone would be a fairly ordinary bad week. What made it different is who joined in. BlackRock’s IBIT, the single largest Bitcoin fund in the world, has spent most of its life doing the opposite of what smaller funds do. When everyone else sells, IBIT usually keeps absorbing money. This week IBIT sold too, including one single day where investors pulled $55 million straight back out.

That matters more than the headline number suggests. It effectively erased the $853 million that flowed in just the week before, the best week since April that we wrote about only seven days ago. A swing that size in a single week is the clearest sign yet that even the most patient money in the room briefly lost its nerve.

The Regulatory Rug Pull

Here is what actually spooked them. On August 13, the SEC cancelled a meeting it had scheduled for the very next day, a meeting where it was expected to formally propose “Regulation Crypto,” the first serious rulebook the agency had ever put forward for the industry. No reason beyond a vague “scheduling issue” was given. No new date was set.

The timing could not have been worse. Galaxy Digital’s head of research, Alex Thorn, had been putting the odds of the Clarity Act, the much bigger bill meant to settle crypto regulation in Congress, at around 75% back in May. This week he cut that estimate all the way down to roughly 10%. A Senate vote is technically still scheduled for September 15, but the confidence behind it has collapsed.

Reporting suggests the White House itself asked the SEC to hold off, worried that a new rule right now could disrupt the delicate negotiations still happening around the Clarity Act. In trying to protect one path to regulatory clarity, Washington ended up stalling both of them at once. For an industry that has spent two years asking for nothing more than clear rules, watching the rulemaking get shelved to protect the rulemaking is its own kind of answer.

Strategy’s Flywheel Has Stopped

Michael Saylor’s Strategy did something it has not done in a very long time this week: nothing. No Bitcoin bought. No Bitcoin sold. Just a company sitting still, holding 840,447 Bitcoin at an average cost of $75,385, with an unrealised loss approaching $10 billion.

The company still needed cash, though. It raised $333.7 million by selling new shares, and used the proceeds mostly to pay preferred dividends and buy back some of its STRC stock. Not one dollar of it went toward buying more Bitcoin. The engine that made Strategy famous, raising money specifically to buy Bitcoin, appears to have genuinely paused.

There is a second, more structural threat brewing alongside it. Index provider MSCI opened a consultation this week proposing to remove Strategy, along with two similar companies, from its stock market indices entirely, under a new rule targeting companies that mostly just hold digital assets rather than run an operating business. JPMorgan estimates that removal could force roughly $2.8 billion out of Strategy’s shares, simply because funds that track those indices would be required to sell. The consultation closes at the end of September, with a decision due in mid-October.

The Coldcard Saga, and Company, Gets Worse

We have tracked the Coldcard hardware wallet hack for three weeks now. Confirmed losses passed $115 million this week, with researchers warning the real total could exceed $130 million once everything is accounted for. Coinkite has fixed the underlying bug and stopped shipping affected devices, but it is offering no compensation fund. Its own terms of sale cap what it owes any individual customer at whatever they originally paid for the device.

It was not a good week for hardware wallet security more broadly, either. Trezor confirmed a breach of 14,000 customers’ shipping data. SafePal confirmed nearly 40,000. An Israeli exchange called Bits of Gold reported around 200,000 customers exposed, including national ID numbers and bank details. None of these are Coldcard-related. They simply landed in the same seven days, turning a bad month for cryptography into a genuinely rough one for customer privacy across the whole industry.

Quick Hits

The US Treasury moved on stablecoins. Treasury proposed the actual licensing rules for the GENIUS Act, the stablecoin law we covered back when Trump signed it. The rule spells out exactly who needs a licence to issue a stablecoin in America and requires foreign issuers to prove they can comply with US legal orders when required. It is a genuinely rare thing this week: a piece of US crypto policy that actually moved forward rather than stalling.

Russia both welcomed and squeezed Bitcoin in the same week. Russia’s central bank named Bitcoin, Ether and the dollar-pegged stablecoin USDT as the only crypto assets ordinary Russian investors will be allowed to buy from September, a real, if grudging, stamp of legitimacy from a government that has spent years threatening an outright ban. Days later, the same government banned Bitcoin mining in Moscow and the surrounding region entirely until 2032, an area responsible for a meaningful slice of the world’s total mining power. Opening the door to Bitcoin as an investment while shutting it as an industry is a strange combination, but it is the one Moscow chose.

Bitcoin’s mining security budget is under real strain. Network hashrate, the total computing power protecting Bitcoin, has fallen by about a third since its October peak. Transaction fees now make up less than 1% of miner income, the lowest share in a decade. Miners are increasingly leasing their facilities to AI companies instead, which pays better right now than mining does. None of this puts Bitcoin at immediate risk, but a smaller, less profitable mining industry is a genuinely less secure one over time.

The SEC has not set a new date for Regulation Crypto, and the Clarity Act still technically faces its Senate vote on September 15. I’ll cover both the moment there is real movement. Make sure you’re subscribed.

And Finally…

CZ Got Chased Off His Own Wallet by Meme Coins

Changpeng Zhao, the founder of Binance, retired his own public Bitcoin wallet this week, donating nearly a million dollars from it to charity in the process. His stated reason was almost funny enough on its own: strangers had spammed his wallet with so many random, unsolicited meme coins that he could no longer find his own transactions in the interface. The other reason was less charming. Traders had turned watching his every move into a strategy, copying his trades in real time, with one reportedly turning it into a 29 times return. Crypto’s most recognisable person effectively got pushed off the transparent ledger he has spent years championing, by the very transparency that made him famous.

Two “Unchangeable” Blockchains Hit Undo in the Same Week

Ravencoin and Harmony, two much smaller blockchain projects, both announced plans this week to roll back their own transaction history after separate hacks, deleting real transactions that had already happened to undo the damage. Blockchains are supposed to be permanent by design, that is meant to be the entire point. Watching two of them hit the equivalent of Ctrl+Z in the same seven days is a useful reminder that “unchangeable” often turns out to mean “very hard to change,” not “impossible.”

Quick Questions

Q: Does IBIT selling for the first time mean BlackRock has lost confidence in Bitcoin?

A: Not necessarily. One week of outflows after months of steady buying is not the same as a change of view. It is a genuine shift worth watching, but a single week rarely tells you someone’s long-term thinking has changed.

Q: If Strategy gets removed from MSCI’s indices, does that affect the Bitcoin I hold?

A: No. It affects Strategy’s share price and which funds are allowed to hold Strategy stock. It has no direct effect on Bitcoin itself or on Bitcoin held outside of Strategy.

Q: Is my Bitcoin at risk from the falling hashrate?

A: Not right now. Bitcoin’s network is still enormously more secure than any realistic attacker could overcome. It is a trend worth watching over years, not something that threatens your holdings today.

Why Are Institutions Buying While Everyone Else Has Stopped Watching?

Picture two very different rooms right now.

In the first room are ordinary people, the kind who search “Bitcoin” on Google when they are curious, worried, or thinking about buying. That room is almost empty. Search interest has fallen lower than it was during the brutal 2022 and 2023 crash, back when Bitcoin was worth a quarter of what it is today. People have simply stopped looking.

In the second room are the big institutional buyers, the funds and asset managers who buy Bitcoin through an ETF rather than an app on their phone. That room has been unusually busy. These funds bought $853.5 million worth of Bitcoin in the week to August 7, the best week since April, and BlackRock’s fund alone accounted for the vast majority of it. To put that in perspective, the whole Bitcoin network only produces around 3,150 new coins in a week. Institutional buyers alone soaked up more than four times that.

Put those two rooms side by side and you get a genuinely useful signal. Ordinary investors tend to pile in once everyone else is already excited and the price is moving. Right now, nobody is excited. The Fear and Greed Index, a simple daily read on the market’s mood, spent the entire week in Fear territory and never climbed above 27. Institutions do not really care about that mood. They tend to buy with a much longer view in mind. So when the crowd goes quiet and the professionals keep turning up anyway, that is usually a sign of real conviction, not hype.

Worth being honest about the scale of it too, though. As strong as that week was, it did not even last: by August 10, $144.6 million had already flowed back out. Zoom out further and Bitcoin ETFs have still paid out more overall this year than they have taken in. This was a good week. It was not a turning point.

Bitcoin Has Gone Eerily Quiet

The other side of that silence showed up in the price chart. Bitcoin spent the week pinned between roughly $63,400 and $65,400, its calmest stretch of trading since 2023. On Saturday it moved just $350 from its daily high to its daily low, the tightest single day in nearly three years. A measure of expected volatility called the Deribit DVOL index fell to around 35, down from roughly 90 earlier this year.

There is a mechanical explanation. On-chain data shows about 1.79 million Bitcoin sitting at an average purchase price between $62,000 and $65,000, which is exactly where the price is currently parked. That is a dense wall of holders all sitting on roughly break-even, and it naturally smothers movement in either direction.

Quiet is not the same as safe, though. Bitwise’s Luke Deans made the point well this week: thin participation and low liquidity can make a market more fragile, not less, because it takes less buying or selling to shove the price a long way. A market coiled this tightly, arriving just as the July inflation report and a run of major regulatory dates line up, does not tend to stay quiet for long.

The Coldcard Story Just Got Worse

We covered the Coldcard hardware wallet hack in detail over the past fortnight: a firmware bug from 2021 quietly weakened the randomness protecting thousands of wallets, and attackers drained more than $130 million once they worked out how to exploit it. This week brought the aftermath.

The scare triggered an industry-wide security sweep across Bitcoin-related software, which turned up 85 additional critical bugs across 390 different code repositories. None are confirmed to have been exploited, but it is a sobering look at how much unglamorous security work goes unnoticed until something breaks. Galaxy Research also now believes the Coldcard theft involved at least 12 to 15 separate attackers rather than one group, spread across roughly 7,300 addresses. Around 90% of the stolen coins still have not moved.

Coinkite, the company behind Coldcard, made one telling move this week. It suspended its usual policy of automatically deleting old customer data after 120 days, citing “legal obligations arising from the security incident.” That is what lawyers call a litigation hold, and a class action is reportedly forming.

It still has not published an official final total for the losses, and there is a good reason for that beyond simply being slow. Coinkite does not keep records tying customers to the specific devices they buy, that is a deliberate privacy choice, and it has no way of knowing which private keys any given device ever generated, let alone which Bitcoin addresses those keys control. The only way Coinkite could ever learn about a theft is if an affected customer contacts them directly, and even then there is no way to prove the claim is genuine rather than mistaken or exaggerated. The $130 million figure comes from independent blockchain researchers piecing together suspicious fund movements, not from Coinkite itself, and the true total may never be fully known by anyone.

Strategy Sold Again. Nobody Bought at All.

Michael Saylor’s Strategy sold 1,690 Bitcoin this week for roughly $108.6 million. That works out to an average price of $64,262 a coin, well below the company’s own average cost of $75,385. It is the second week in a row Strategy has sold rather than bought. The company also raised $653 million by selling shares, which pushed its cash reserve up to $4.65 billion. Strategy now holds 840,447 Bitcoin in total, and is sitting on an unrealised paper loss of around $8.7 billion.

A smaller company had a considerably rougher week. Empery Digital’s quarterly filing revealed it sold 1,635 Bitcoin for $102.2 million between July and early August. That cut its holdings from 1,375 coins down to just 325, a 76% reduction in a matter of weeks. Unlike Strategy’s managed drawdown, Empery’s own numbers point to genuine strain: just $3.7 million of cash against a $5.7 million shortfall. Strategy is choosing to sell. Empery looks like it had to.

The detail that ties it together is what did not happen. Not one publicly listed company disclosed buying any Bitcoin this week. The corporate treasury buying spree that powered much of the last two years has, at least for now, gone into reverse. Saylor has defended the sales as proof a position this size can be trimmed without disrupting the market. Analysts increasingly read it as the buying phase being over.

Washington Punts, Regulators Move Anyway

The Clarity Act, the biggest pending piece of US crypto legislation, did not get its vote before the Senate broke for summer. Majority Leader John Thune filed the procedural paperwork at 4:52am on Saturday morning after an overnight session, which keeps the bill alive and sets up a vote for September 15, the day after the Senate returns. It needs 60 votes. Republicans hold 53, so at least seven Democrats have to cross over, and reporting suggests the realistic number is closer to ten.

The sticking points are the same ones we have covered for weeks: ethics rules restricting senior officials from backing crypto projects, stablecoin yield, and illicit finance provisions. A revised ethics compromise has reportedly been sitting at the White House awaiting sign-off for over a week. The dispute is not abstract either. The New York Times reported this week that World Liberty Financial received $100 million from a UK businessman under money laundering investigation, which is close to precisely the scenario the disputed provisions are meant to address.

Regulators are not waiting around, though. The SEC has scheduled a vote for Friday, August 14, on something informally called “Regulation Crypto.” If approved, it would be the agency’s first ever formal crypto rulemaking rather than guidance a future SEC could reverse overnight. It would create a tailored path for crypto projects to raise funding legally, something that currently does not properly exist in the US. A vote opens it for public comment rather than making it law immediately, but it is a durable step that Congress keeps failing to take. The CFTC has separately said its own rules are ready to go, with or without a new law.

Quick Hits

Bybit sued North Korea, and won a freeze. Bybit filed a US federal lawsuit against North Korea, its intelligence agency, and the Lazarus Group over last year’s $1.5 billion hack, still the largest crypto theft on record. A court granted an asset freeze covering roughly $30.5 million of stolen funds held across various platforms. Suing a country that will never turn up in court sounds pointless, but it lets Bybit legally freeze funds wherever they surface without needing anyone’s cooperation.

Treasury widens its Iran crypto net. The US sanctioned eight more parties across four countries linked to Iranian crypto exchanges laundering money for the regime, tracing over a million dollars moving through wallets connected to Iran’s Revolutionary Guard. Dubai’s regulator had already shut down one of the same firms days earlier, a rare case of two jurisdictions landing on the same target in the same week.

Mastercard finishes its $1.8 billion stablecoin deal. Mastercard closed its purchase of stablecoin infrastructure company BVNK five months early. BVNK handles around $30 billion a year in stablecoin payments across 130 markets, making Mastercard the first major card network to actually own this kind of infrastructure rather than just partnering with someone who does.

Bitcoin miners are splitting into two camps. Riot Platforms signed a 20-year deal worth up to $9.1 billion leasing part of its facility to an AI company, a far more lucrative use of its power than mining Bitcoin right now. Marathon Digital, meanwhile, reported a $611 million quarterly loss. At current prices, mining profitably has become genuinely hard for anyone without cheap power or a second revenue stream.

The Bigger Picture: The Fed Is Stuck Again

July’s jobs report landed as a genuine shock. The US economy lost 23,000 jobs when economists had expected roughly 80,000 gained. On top of that, the previous two months were revised down by a further 103,000 jobs combined. Normally that pushes the Federal Reserve toward cutting interest rates. Except under new Chair Kevin Warsh, several Fed officials are actively debating whether to raise them instead, because oil has climbed toward $90 a barrel as the Strait of Hormuz standoff drags on. Three officials formally dissented in favour of a hike at the last meeting, and half the committee expects at least one this year.

Gold is up roughly 28% over the past twelve months. Bitcoin, over the same period, is down about 46%. That is not the outcome most people would have predicted for a year featuring a war, an inflation scare, and a supportive US administration.

The July inflation report is the next real catalyst, and it is the single biggest input into the Fed’s September decision. Between that, Friday’s SEC vote and the Clarity Act’s September date, the weeks ahead are shaping up considerably louder than the one just gone.

The SEC votes on Regulation Crypto this Friday, and the Clarity Act returns on September 15. I’ll cover both the moment there is real news. Make sure you’re subscribed.

And Finally…

The FBI Agent Who Asked ChatGPT How to Spend His Stolen Crypto

A former FBI supervisory intelligence agent has been charged with using his own Top Secret security clearance to memorise seed phrases and steal nearly $1 million in crypto from wallets the FBI itself was investigating. The detail that elevates this from ordinary insider crime to genuinely remarkable: he reportedly asked ChatGPT for advice on how to spend the money and relocate to Portugal, with power of attorney paperwork and family travel arrangements already in motion. Even the professionals apparently need a second opinion before fleeing the country.

People Actually Unplugged Their Price Clocks

Amid the Coldcard panic, a programmer posted an urgent warning telling Bitcoin holders to physically unplug their BlockClock, a desk gadget whose entire function is displaying the Bitcoin price, after a parody account joked it secretly contained a “Russian military-grade listening device.” The warning reached 50,000 views before the original poster admitted it was, in his own words, “schizo panic fear.” Real people unplugged their price clocks anyway.

Quick Questions

Q: If retail interest is at a five-year low, is that a bad sign?

A: Not necessarily. Low retail attention alongside strong institutional buying has historically lined up more with quiet accumulation phases than with market tops. It is not a guarantee of anything, but it is not a warning light either.

Q: Does low volatility mean Bitcoin is about to crash?

A: No, it just means the price has been unusually stable. A tightly coiled market can break upward as easily as downward. What it does suggest is that when it moves, it may move sharply.

Q: Is the Clarity Act dead now it has been delayed again?

A: No. The procedural motion filed this week specifically keeps it alive, with a vote set for September 15. It still faces a real hurdle in needing around ten Democratic votes to pass.

Is My Bitcoin Safe? Here Is the Short Answer

Bitcoin itself is completely fine. The Bitcoin network, the protocol, the maths underneath it: none of it was touched, none of it broke, and this has nothing to do with quantum computing either, despite the timing. This was a software bug in one manufacturer’s product: Coldcard, made by a company called Coinkite. It has nothing to do with Bitcoin’s own security, and it does not mean self-custody (holding your own Bitcoin yourself, rather than leaving it with an exchange) is somehow the wrong approach. Self-custody remains sound. This was one company’s implementation getting it wrong.

That said, if you use any Coldcard device, this is genuinely serious and you should read on and act. Coinkite’s firmware had a flaw that made it possible, in some cases, to work out a user’s secret wallet code without ever touching their device or tricking them into anything. That is a real, costly failure and deserves to be treated as one, though it is worth remembering it is a story about one company’s software, not about Bitcoin, and not about whether self-custody in general is safe.

Coldcard was one of the most respected “cold storage” hardware wallets in Bitcoin, a small offline device designed to keep your Bitcoin safe precisely because it never touches the Internet. This week, security researchers confirmed that attackers had drained more than $130 million from thousands of Coldcard wallets, without ever physically touching the devices or tricking anyone into handing over their seed phrase. That combination, an offline device, no user mistake, still robbed, is what has shaken confidence in this particular product this week, and it is worth understanding exactly why, especially if you are one of the customers affected.

A House of Coldcards

Every Bitcoin wallet is protected by something called a seed phrase: 12 or 24 ordinary-looking words that together represent one enormous, supposedly unguessable random number. As long as that number is genuinely random, nobody can ever guess it, and your Bitcoin is safe.

That randomness is measured in something called bits. A 12-word seed phrase gives you 128 bits of randomness. A 24-word phrase gives you 256. Each single extra bit doubles the number of possibilities someone would have to search through to guess it, so these are not small numbers. 128 bits is already considered secure enough to be the accepted minimum standard for protecting a fortune.

Here is a way to picture what a bit actually means. Shuffle a full 52-card deck properly, and there are roughly 226 bits worth of possible orderings, comfortably more than the 128-bit standard, though still slightly short of what a full 24-word seed phrase provides. To match Bitcoin’s 128-bit minimum, you would need to shuffle 35 cards, not all 52. The compromised Coldcard Mk3 wallets, by contrast, had randomness equivalent to shuffling roughly 15 playing cards, about 40 bits, a genuine sense of just how badly things went wrong.

It gets worse still, because it was not just that Coldcard used too few metaphorical cards. The “dealer” shuffling them was also bad at its job: the firmware’s fallback random number generator was not truly random, and it produced patterns that could be predicted once you understood how it worked. So attackers were not blindly guessing from scratch. They only needed to try the combinations most likely to follow a known, flawed shuffle, and on a modern computer, that kind of narrowed search takes minutes, not the years or centuries a properly random 128-bit number would require.

How Do You Steal From a Device That Was Never Online?

The problem traces back to a firmware update Coinkite pushed in March 2021. Instead of using the device’s dedicated hardware chip built specifically to generate true randomness, a bug caused Coldcard devices to fall back on that flawed, predictable software substitute. The severity depended on the model: roughly 40 bits on the older Mk3, and roughly 72 bits on the newer Mk4, Mk5, and Q devices (about 23 shuffled cards’ worth), which mixed in a little genuine hardware randomness but not nearly enough to reach the intended 128.

Once attackers cracked the pattern, they did not need to touch anyone’s device, trick anyone into clicking a link, or steal anyone’s seed phrase. They simply worked out which seed phrases the flawed firmware was likely to have generated, reconstructed the private keys offline, and swept the funds directly. The first wave hit on July 30, draining roughly $38 million from around 500 wallets in just 25 minutes. By this week, cumulative losses had climbed past $130 million.

One important point that is easy to miss: the flaw lives in the seed itself, not in the physical Coldcard device. If you moved away from Coldcard at some point in the past but carried your original Coldcard-generated seed phrase over into a different wallet or vendor, you are still at risk today. Getting rid of the device changes nothing if the same underlying seed is still the one protecting your funds.

What Should You Actually Do?

If you use any Coldcard device, do not wait, and do not simply update the firmware and carry on as before. Updating alone does not fix a seed that was already generated while the bug was active. The number itself is compromised, no matter what firmware you run afterwards. Here is the safest path, in order.

1. Get a new hardware wallet from a different manufacturer that has publicly confirmed it is not affected by this specific bug. Bitkey, Ledger and Trezor, for example, have all done so, and there may be others by now.

2. Set the new wallet up completely from scratch. Do not restore your old Coldcard seed phrase onto it. That seed is the compromised part. Carrying it over defeats the entire point.

3. Generate a brand new Bitcoin receiving address on the new wallet.

4. Send a small test amount first, $5 or $10 of Bitcoin, from your old Coldcard to the new address, just to confirm everything is set up correctly.

5. Once that test transaction has fully confirmed on the network, move everything else across the same way.

If you do not have a spare hardware wallet sitting at home and cannot get to a store today, time still matters more than perfection. A temporary software wallet, or moving funds to a reputable exchange in the short term, is safer than leaving Bitcoin protected with a Coldcard seed right now. An old, otherwise unused phone with a reputable wallet app such as Cupcake Wallet in air-gap mode can even act as a rough stand-in for a hardware wallet in the meantime.

None of these temporary options are as secure as a proper hardware wallet long term, and they carry their own separate risks, but none of those risks are as immediate, real, and currently being actively exploited as leaving funds on a compromised Coldcard seed. As soon as a genuine replacement hardware wallet is in hand, move the funds off the temporary option using the exact same process: new wallet, new seed, test transaction first, then the rest.

If you do not own a Coldcard, there is still a genuinely useful lesson here. A wallet can look completely secure, offline, tamper-proof, never connected to the Internet, and still fail at a step you can never personally see: how the device generated your seed phrase in the first place. That is not a reason to distrust self-custody generally. It is a reason to understand that the strength of your setup depends on more than owning the right device. It depends on the firmware behind it too.

Doesn’t Open Source Mean Someone Would Have Caught This?

Coldcard’s firmware is fully open source, published on GitHub for anyone to read. That is usually held up as one of the great strengths of Bitcoin-adjacent software: because the code is public, the theory goes, thousands of eyes can review it, and a serious flaw simply cannot hide for long. This bug sat there for over five years without anyone catching it, and it is worth being honest about why, because the answer says something useful about open source software generally, not just about Coldcard.

The theory assumes people actually show up to look. In practice, most developers are busy, and reading through someone else’s unfamiliar codebase line by line is tedious, unpaid work that nobody particularly enjoys. Being technically allowed to check the code is not the same as anyone actually doing it. Coinkite’s own account of the incident says the flaw lived in an obscure boundary between two unrelated pieces of the code, in an area outside what its internal and outside reviews typically focused on. Reviews happened, they simply never looked in the right place, for over five years.

Then AI Entered the Picture

Here is the double-edged part. The same openness that is supposed to let good-faith researchers catch bugs also lets attackers study the code just as closely, and unlike volunteer reviewers, attackers have a very direct financial incentive to look hard. Coinkite has said it believes the attacker used AI tools to find the exact flaw that its own AI-assisted review, run on the same code just weeks earlier, had completely missed. Coldcard co-founder NVK put it plainly afterwards: assume that any code which is or ever has been public is already being read by attackers and defenders alike, and that AI now finds this kind of subtle bug far faster than even experienced human engineers.

That creates a genuinely uncomfortable asymmetry: an attacker only needs to find one exploitable flaw, while whoever is defending the code needs to find and fix every single one, every time, forever. An AI tool that reviews code and reports nothing serious can feel reassuring, right up until a different AI tool, in different hands, finds the one thing it missed.

Open Source Isn’t the Same as Independently Audited

None of this makes closed source the obvious answer either. If Coldcard’s code had never been public, outside attackers could not have picked through it looking for this flaw, but there would also have been no chance of an independent researcher spotting it and quietly reporting it before anyone got hurt. Every serious hardware wallet maker has to choose some mix of open source transparency and paid, professional third-party audits, and it is worth being accurate about where each one actually sits. Ledger is the clear standout for the audit-heavy approach: it has spent years publicly touting independent certified audits of every new device it releases, carried out by outside laboratories in France, alongside its own internal security team and a bug bounty programme.

Trezor and Bitkey, by contrast, lean primarily on the same pitch Coldcard does, fully open source code that anyone can inspect, with Trezor adding certified hardware chips on top, but neither publicising an ongoing paid firmware audit trail in the way Ledger does. Coinkite’s own public account of this incident points mainly to internal reviews and a general historical record of “professional reviews,” without the same kind of ongoing, certified, third-party audit trail Ledger champions. That does not prove no outside review of Coldcard’s code ever happened, but the absence of a similar claim is itself telling, and it is a reminder that “open source” alone, even across several well-regarded wallet makers, is not automatically the same thing as “independently audited.”

The real lesson from this incident is not that open source failed, or that audits are pointless. It is that “the code is public” and “the code has genuinely been checked properly” are two very different claims, and it is worth knowing which one is actually true for anything holding your money.

The Industry’s Response: A New Security Fund

Perhaps not entirely coincidentally, this week also brought news that nine major financial and crypto institutions, including BlackRock, Coinbase, Fidelity, ARK Invest, and Strategy, have formed something called the Bitcoin Security Consortium. The group has pledged $15 million over three years to fund the open-source developers who maintain and improve Bitcoin’s security, including work on post-quantum cryptography, the defence against future quantum computers we covered in an earlier article.

It is a small amount of money relative to the size of the companies involved, but it is a meaningful signal. The Coldcard exploit was a reminder that security work most people never think about, firmware, random number generation, cryptographic upgrades, is exactly the kind of unglamorous engineering that prevents the next $130 million loss. Wall Street quietly funding more of it is a good thing, however modest the number.

The Clarity Act Finally Gets Its Vote. But Still Needs to Win It.

Away from the security story, the Clarity Act took a real step forward this week. Senate Majority Leader John Thune confirmed the bill will get an actual floor vote before the August recess, something that looked genuinely uncertain a fortnight ago when it was shelved for other priorities.

The hard part is not over. Republicans hold 53 Senate seats, and passing the bill requires 60 votes to overcome a filibuster, meaning at least seven Democrats need to cross over, a real hurdle, not a formality. A successful vote would be the single biggest regulatory moment in Bitcoin’s history and could spark a significant rally. Falling short pushes the whole process into next year, closer to the 2026 midterms, where getting anything done becomes considerably harder.

The Rest of the Week, Briefly

Bitcoin rebounded above $64,000. Reports of a possible diplomatic breakthrough between the US and Iran over the Strait of Hormuz eased fears of a wider conflict, pulling oil prices down and lifting risk assets broadly, Bitcoin included.

ETF outflows reversed. After more than $526 million left US spot Bitcoin ETFs over four brutal days, the trend flipped on August 4, with over $170 million flowing back in, more than half of it into BlackRock’s IBIT alone.

A dormant whale moved $1.04 billion. A wallet that had not moved in seven months suddenly transferred 16,400 Bitcoin to a new address. Nobody knows why for certain, but it coincided with a broader spike in large transactions, which some researchers link to holders reorganising their security setups in the wake of the Coldcard news.

Strategy sold more Bitcoin. Michael Saylor’s company offloaded 1,638 Bitcoin for roughly $105 million, continuing its recent shift toward building cash reserves rather than pure accumulation. It still holds 843,775 Bitcoin.

Cathie Wood bought the dip. ARK Invest added to its positions in Coinbase, Circle, and Robinhood this week, signalling continued long-term conviction in crypto infrastructure even as headlines turned negative.

The Clarity Act floor vote is expected before the Senate’s August recess. I’ll cover the result the moment it happens. Make sure you’re subscribed.

And Finally…

Jim Cramer Panic-Sells. Crypto Twitter Celebrates.

CNBC host Jim Cramer announced live on air this week that he plans to sell his entire Bitcoin holding, citing fears that quantum computers will break Bitcoin’s security within three years. Crypto social media did not react with concern. Thanks to the long-running “Inverse Cramer” meme, the theory that whatever Cramer does, the opposite tends to happen, his announcement was instantly treated as a bullish signal. Sure enough, US Bitcoin ETFs pulled in $170 million the very next day. The quantum threat itself is real and worth taking seriously, but is still a long way off, as we have covered before. Cramer’s timing, less so.

Quick Questions

Q: Do I need to worry if I do not own a Coldcard wallet?

A: No direct action needed, but it is worth checking which hardware wallet you use and whether it has ever had a similar firmware issue. This exploit affected one manufacturer’s specific firmware bug, not Bitcoin or hardware wallets in general.

Q: If I update my Coldcard firmware, am I safe now?

A: Not automatically. Updating fixes future seed generation, but it does not repair a seed that was already created while the bug was active. You need to generate a brand new seed on the patched firmware and move your funds to it.

Q: Does this mean self-custody is more dangerous than just using an exchange or ETF?

A: No. It means self-custody requires understanding the whole chain, not just owning a device. Exchanges and custodians carry their own risks, including hacks and insolvency. This incident is a reason to be diligent about firmware and setup, not a reason to hand your Bitcoin to someone else.

Why Did Congress Shelve Its Own Biggest Crypto Bill?

The US Senate quietly put the Digital Asset Market Clarity Act to one side this week, choosing to spend its limited time before the August recess on a Russia sanctions bill and a batch of judicial nominations instead. In plain terms: not enough political will, not enough hours in the day, and other things jumped the queue. It now looks very unlikely the bill gets a vote before Congress breaks for summer, which pushes any real decision further into the year.

That matters because the Clarity Act is the single piece of legislation that would finally tell everyone — banks, exchanges, and ordinary investors — exactly how Bitcoin and other crypto assets are regulated in America. Right now nobody has that clarity, hence the name. Bitcoin dipped below $65,000 over the weekend as investors absorbed the news that certainty was, once again, being pushed back.

The Twist: Wall Street Wants This Bill More Than Washington Does

Here is the part that makes this week genuinely interesting rather than just another delay. BlackRock — the largest asset manager on the planet, running trillions of dollars — has formally endorsed the Clarity Act, joining a growing list of major financial firms publicly pressing the Senate to pass it. Samara Cohen, BlackRock’s Global Head of Market Development, called the bill “an important step toward establishing a regulatory framework for digital assets that puts investors first,” arguing it would support innovation while keeping the transparency and investor protections her clients expect.

It is worth understanding why BlackRock in particular cares so much. Its Bitcoin ETF, IBIT, has pulled in over $63 billion since launch — one of the fastest-growing ETFs Wall Street has ever seen. Every dollar in that fund sits inside a regulatory grey area for as long as Congress refuses to spell out clearly which US regulator actually oversees Bitcoin and the rest of the crypto market long term. Clear rules do not just sound nice to a company like BlackRock. They protect a genuinely enormous and fast-growing business line from the risk of a future regulator deciding, after the fact, that the rules were something different all along.

When a bill gets shelved despite the world’s biggest financial institution actively pushing for it, that tells you the holdup has nothing to do with whether serious money wants this. It has everything to do with politics.

And the politics are genuinely stuck. Senate Democrats, led by Richard Blumenthal and Chris Van Hollen, held a public forum this week specifically examining President Trump’s personal crypto investments, which reportedly generated $1.4 billion for his family businesses last year. The core disagreement holding up the bill is whether the new rules should stop government officials from issuing or promoting their own crypto products while they are the ones writing the rules for everyone else. Until that gets resolved, BlackRock can lobby all it likes.

The Fed Decision Everyone Is Waiting On

The Federal Reserve announces its interest rate decision on July 29, and most people expect rates to stay exactly where they are. But the odds of a surprise rate hike have crept up to around 37% this week, driven by inflation concerns that refuse to go away. That uncertainty alone was enough to spook some investors, contributing to $465 million leaving Bitcoin ETFs on Thursday and Friday — even after three straight weeks of money coming back in overall.

The pattern should feel familiar by now. Higher rates make cash and bonds pay more, which makes an asset like Bitcoin that pays no interest look less attractive by comparison. Nothing has changed about that relationship. What has changed is that the market is currently pricing in slightly more chance of a hawkish surprise than it was a few weeks ago.

A UK Bitcoin Company Just Voted to Give Up

Away from Washington, there was a much smaller but genuinely important story this week. Shareholders of Satsuma Technology, a UK-listed company that had built its entire business around holding Bitcoin on its balance sheet, voted overwhelmingly to sell its entire 668 Bitcoin holding — worth around $43.5 million — and shut the company down.

This is the first time we have seen a public Bitcoin treasury company actually unwind completely, rather than just pause buying or sell a small slice to cover costs. Reports suggest as many as twenty public companies globally are quietly stepping back from the “buy Bitcoin and hold it forever” strategy that became fashionable over the last two years. Satsuma is the clearest example yet of what happens when that strategy meets a falling share price: shareholders eventually decide the risk of holding a volatile asset on a company balance sheet is not worth it, and vote to cash out.

This does not mean the corporate Bitcoin treasury idea is finished. Strategy, the largest of these companies, still holds 843,775 Bitcoin. But Satsuma is a real, concrete example of the downside risk we have discussed in the abstract in previous articles — and a useful reminder that not every company copying this playbook has Strategy’s scale or staying power.

Speaking of Strategy, It Has Stopped Buying

Strategy confirmed this week that it made no new Bitcoin purchases between July 20 and July 26 — the fourth week in a row without adding to its stack. Instead of buying more Bitcoin, the company raised $544.5 million by selling shares.

Four weeks without a purchase is a genuinely long pause for a company that built its entire reputation on buying Bitcoin relentlessly, in good times and bad. It does not necessarily mean Saylor has lost conviction. Raising cash rather than spending it can just as easily mean the company wants a bigger safety buffer before committing more, especially with Bitcoin’s price sitting well below its highs. But after weeks of covering dividend payments and rebuilding reserves, a fourth straight week of silence on the buying front is worth noting plainly rather than explaining away.

Quick Hits

The EU tightens the net. Brussels adopted its 21st sanctions package against Russia this week, which for the first time includes a transaction ban on fourteen named crypto platforms operating out of places like the UAE, Panama, and Georgia. There is also a new mechanism allowing the EU to ban entire countries’ crypto services if they are found to be helping Russia dodge sanctions. Any crypto business wanting to keep access to European customers now has a strong incentive to tighten its compliance.

Minnesota bans Bitcoin ATMs. From August 1, operating a cryptocurrency kiosk in Minnesota becomes illegal, with existing machines required to be removed by the end of the year. The stated reason is fraud and scam prevention, and Minnesota now joins Indiana and Tennessee in restricting this increasingly common on-ramp into crypto for cash-based customers.

Uphold cuts staff. Crypto platform Uphold laid off 85 people — about 17% of its workforce — as it shifts focus away from everyday retail customers and towards banks and larger institutional clients. It is another small data point in a pattern we have flagged before: retail trading interest has cooled considerably in 2026, and platforms built around retail volume are having to adapt or shrink.

And Finally…

The Pizza That Still Haunts Everyone

A viral clip made the rounds again this week retelling the story of the man who once paid 10,000 Bitcoin for two pizzas back in Bitcoin’s earliest days. At Bitcoin’s 2025 peak, those two pizzas would have been worth roughly $690 million. As the caption dryly put it: he got the pizzas, he did not keep the Bitcoin. Somewhere out there, another meme is doing the rounds of two people on a small boat, one much older than the other, captioned “if Bitcoin fails, my retirement plan is Doris.” Gallows humour, but it does capture the mood of anyone still waiting for their portfolio to turn a profit.

Quick Questions

Q: Is the Clarity Act dead?

A: No, just delayed again. It has been pushed behind other Senate priorities and is unlikely to get a vote before the August recess, but it has not been cancelled or rejected.

Q: Does BlackRock lobbying for the bill mean it will pass?

A: Not on its own. BlackRock wanting clear rules adds pressure, but the actual holdup is a political disagreement between parties over ethics rules for government officials’ crypto holdings, which BlackRock cannot resolve by lobbying alone.

Q: Should I be worried that a Bitcoin company just liquidated?

A: Not about Bitcoin itself. Satsuma’s collapse is a lesson about the risks of a single company holding a volatile asset on its balance sheet, not a sign that Bitcoin as an asset is in trouble. Bitcoin held directly by you is unaffected by one company’s business decisions.

Why Did Bitcoin Whipsaw This Week?

Two forces pulled in opposite directions, and neither one won cleanly. On one side, the big US Bitcoin ETFs took in fresh money for a second week running, a sign that institutional investors are cautiously stepping back in. On the other side, the conflict between the US and Iran flared up again, oil prices jumped, and investors did what they usually do when the world looks shakier: they sold anything that felt risky, Bitcoin included. The result was a choppy week where good news and bad news kept cancelling each other out, and Bitcoin ended up bouncing between roughly $62,600 and $65,000 without ever really settling.

The ETF Money Is Coming Back, Slowly

The thirteen US spot Bitcoin ETFs — the funds that let ordinary investors own Bitcoin through a normal stock market account, without ever touching a crypto exchange — pulled in $75.7 million in the week to July 19. That followed $197.4 million the week before. Put together, that is two straight weeks of money coming in, after a long stretch where it had mostly been going out.

It is worth being honest about the scale here. $75 million sounds like a lot until you remember these funds have tens of billions of dollars in them already. This is a trickle returning, not a flood. But trickles matter, because they tell you which way sentiment is turning. Two weeks of inflows after months of outflows is the kind of small signal that often shows up before a bigger shift, not after one.

Why Did an Argument Thousands of Miles Away Move the Price?

Bitcoin fell to around $62,600 on July 14 as tensions between the US and Iran escalated, and dipped again to roughly $63,130 a few days later. The mechanism is simple once you see it. Iran sits next to a major oil shipping route, so any escalation there raises fears about oil supply. Oil prices went up. Higher oil prices tend to push inflation up too, because energy costs feed into the price of almost everything else. And when inflation fears rise, investors worry the Federal Reserve will keep interest rates higher for longer, which makes risk assets like Bitcoin less attractive by comparison to safer options like cash and government bonds.

The interesting part is what this tells you about how Bitcoin is currently being treated. In theory, an asset with a fixed supply that no government controls should be a hedge against exactly this kind of geopolitical chaos. In practice, this week it traded like a nervous tech stock, selling off right alongside broader risk markets rather than acting as a safe haven. That gap between the theory and the current behaviour is one worth watching over time.

The Clarity Act Is Still Going Nowhere

The Digital Asset Market Clarity Act — the bill that would finally give America clear rules for who regulates what in crypto — remains stuck in the Senate. The sticking points have not changed in weeks: disagreement over ethics rules for government officials who hold crypto, and unresolved questions about anti-money-laundering provisions. With the Senate’s August recess approaching fast, the window to get this done in 2026 keeps shrinking.

One widely shared post on X this week asked whether Bitcoin touching a 30-day high meant the Clarity Act was about to pass. It was not. That is worth flagging plainly: price movement is not legislative news, and no vote has been scheduled. The honest state of play is exactly where it was last time we covered this — stuck, waiting, and running out of runway before the summer break.

There is one fresh, if unconfirmed, development worth flagging. Odds on prediction market Polymarket for the Clarity Act passing this year jumped to 43%, up from a record low the week before, after unverified reports suggested President Trump had agreed to a key ethics provision — the rule covering whether officials can hold crypto while writing the laws that govern it. No bill text has actually appeared, and nothing is confirmed. But a jump like that in a prediction market is a signal worth watching, even if it is not proof of anything yet.

Strategy Builds a Bigger Cushion

Strategy, the company run by Michael Saylor that holds more Bitcoin than any other on earth, announced on July 20 that it had increased its US dollar cash reserve by $225 million, bringing it to $3.2 billion. Its Bitcoin holdings stayed exactly where they were: 843,775 coins.

This is a different story to the one we have been following over the past month, where Strategy was selling Bitcoin to cover dividend payments on its various preferred stock products. Building a bigger cash buffer, rather than reaching for the Bitcoin pile again, is the company signalling that it wants more breathing room before it needs to touch its core holding. It is a small but meaningful shift from selling under pressure to preparing in advance.

Michael Saylor vs. a Mining Proposal Called BIP-110

Away from the price chart, one of the more heated arguments in Bitcoin this week had nothing to do with money at all. Foundry, one of the largest Bitcoin mining pool operators, opened a vote among its mining clients on a proposal called BIP-110.

Here is what that actually means. Bitcoin miners are the computers around the world that process transactions and keep the network running, and changes to how the network operates sometimes need their support to move forward. BIP-110 is a proposed temporary rule change that would restrict certain non-financial data — things like images or messages — from being embedded inside Bitcoin transactions. Supporters call it basic housekeeping to stop the network being clogged with data it was never designed to carry. Critics, including Michael Saylor, publicly pushed back this week, framing any restriction on what can go into a Bitcoin transaction as a step towards letting someone decide what content is acceptable on the network — which cuts against Bitcoin’s core idea that no one is in charge.

Nothing has changed yet. Foundry’s pool defaults to voting “No” unless more than 51% of the mining power voting actively supports the change before an early-August deadline. This is a live governance process, not an approved upgrade, and it is worth watching precisely because it puts an abstract debate about Bitcoin’s principles into an actual, countable vote.

Bitcoin Keeps Getting Easier to Buy the Traditional Way

Three separate announcements this week all point the same direction: more ways to gain exposure to Bitcoin through completely ordinary financial products.

T. Rowe Price, a US asset manager looking after $1.89 trillion of client money, launched an actively managed crypto fund on the New York Stock Exchange on July 16, giving its enormous client base a regulated way to get exposure to Bitcoin and several other cryptocurrencies in one product. CoinShares launched a Bitcoin mining fund on Germany’s Deutsche Börse, built specifically to meet the rules European pension funds and insurers have to follow — meaning large, conservative European investors who could not previously touch anything crypto-related now have a compliant route in. And in Russia, a comprehensive crypto law is now just two votes away from passing parliament, replacing years of ambiguity with an actual licensing system for exchanges and brokers, albeit with real restrictions on ordinary retail investors.

None of these are Bitcoin itself becoming more valuable overnight. What they represent is the plumbing — the boring, unglamorous infrastructure work — quietly getting built out in more places, by more serious institutions, in more countries. That is usually how lasting adoption actually happens: slowly, then all at once.

Bitcoin Miners Are Feeling the Squeeze

Bitcoin spent the week consolidating around $63,700, sitting about 14% below its 200-day average price — a common measure of the longer-term trend. Investment firm VanEck reported that daily mining revenue has fallen to a level where less efficient mining equipment is now operating at or below breakeven.

In plain terms: mining Bitcoin costs electricity and hardware, and when the price stays low for long enough, the miners running older or less efficient machines start losing money on every coin they produce. If that continues, some may be forced to sell their existing Bitcoin holdings to cover costs, or shut down entirely. That is not a crisis today, but it is exactly the kind of quiet pressure that can build into a bigger story if prices do not recover.

And Finally…

The Universal Crypto Confession

One post doing the rounds this week summed up a feeling almost everyone in crypto quietly shares: pretending to understand every acronym thrown around in conversation, then secretly opening five browser tabs the moment nobody is looking to figure out what on earth was just said. It is, as the original poster put it, a bit like sitting at a dinner where everyone else somehow knows the secret recipe. If that sounds familiar, you are in exactly the right newsletter — explaining the acronyms properly, so you never have to fake it, is rather the whole point of Just Bitcoin.

Quick Questions

Q: Did the Clarity Act nearly pass this week?

A: No, though the odds moved. A viral post asked whether Bitcoin hitting a 30-day high meant the Clarity Act was close to passing — that was just speculation. But separately, unverified reports that Trump agreed to a key ethics provision pushed prediction market odds up to 43%. Nothing is confirmed and no vote is scheduled, but it is worth watching.

Q: Is BIP-110 now part of Bitcoin?

A: Not yet, and it might never be. It is a proposed temporary rule change that mining pools are currently voting on. Unless more than half of the voting mining power backs it before an early-August deadline, it does not go ahead.

Q: Should I be worried about Bitcoin miners going under?

A: Not urgently. Some older, less efficient mining machines are currently running at a loss, which could eventually force some miners to sell Bitcoin or shut down. It is a pressure point worth watching, not an emergency happening right now.

A Promise With Small Print

In March 2025, Trump signed an executive order creating the Strategic Bitcoin Reserve. The headline commitment was simple: Bitcoin the government seizes goes into the reserve, and Bitcoin in the reserve is never sold. It was, at the time, one of the most pro-Bitcoin things any government on Earth had ever put in writing.

On Monday this week, government wallets moved roughly $288 million in seized Bitcoin and Ether onto Coinbase Prime — a platform built for institutions that need to trade or liquidate large positions. Blockchain trackers spotted it within hours. The obvious question followed immediately: is the government about to break its own promise?

The honest answer is more nuanced than the headlines suggest, and the nuance is worth understanding properly.

What Actually Moved, and Why It Is Not (Quite) a Broken Promise

The Bitcoin in question — roughly 3,800 to 3,940 coins, depending on which snapshot you use — came from two sources: Ryan Farace, a dark web dealer known as "Xanaxman," and the long-defunct exchange BTC-e. The Ether, a separate $53 million, was linked to a money laundering case involving a former Oracle employee.

Here is the detail almost every early headline missed. The executive order’s no-sell rule only applies to Bitcoin that has completed the final forfeiture process and been formally deposited into the reserve. Coins tied to active or recently resolved criminal cases sit outside that vault until the legal process is fully finished — and some of this week’s transfer falls into exactly that grey zone. Moving it to a custodian is not automatically a breach of the reserve rule, because it may never have been reserve Bitcoin in the first place.

There is a second layer worth knowing. The order’s "never sell" language applies specifically to Bitcoin. Ether and every other token the government seizes sit in a separate bucket called the Digital Asset Stockpile, which comes with no such promise. The Treasury has explicit authority to manage — including sell — assets in that stockpile as it sees fit. So the Ether moved this week was never protected to begin with. Only the Bitcoin portion raises any real question, and even that depends on where exactly those specific coins sat in the legal process.

None of this means the transfer is definitely innocent. Coinbase Prime is a custody platform, but it is also a trading desk. Large holders who intend to keep coins for decades typically leave them in cold storage rather than routing them through fresh intermediary wallets into an exchange’s deposit address — which is exactly what happened here with the Bitcoin, moved in two hops rather than sent directly. That routing pattern is unusual enough that several blockchain researchers flagged it as looking preparatory, even if custody alone would not require it.

Why It Matters Either Way

Zoom out and the specifics of this one transfer matter less than what it reveals about the reserve itself. The Strategic Bitcoin Reserve exists only by executive order. It is not law. A future president could unwind it with a single signature, and even under this administration, Treasury and Commerce are reportedly still arguing over who actually controls the assets inside it.

A bill called the American Reserve Modernization Act, introduced back in May, would fix exactly this problem — turning the reserve into statute with a mandatory 20-year holding period that no single administration could quietly reverse. It has not passed. Until it does, "the government will never sell its Bitcoin" remains a policy preference, not a legal guarantee.

Even after this week’s transfer, the government still holds around 324,552 Bitcoin — among the largest state holdings on the planet, and this movement represents well under 1% of it. Nobody is suggesting Washington is about to dump its entire stack. But a government that is simultaneously the world’s largest sovereign Bitcoin holder and unable to say with total legal certainty what its own custody rules actually mean is a genuinely interesting position to be in.

The Institutional Retreat Continues

This is not the only story this week about big holders and Bitcoin under pressure. Strategy sold roughly $218 million of Bitcoin so far in 2026 to fund dividends and rebuild its cash reserves, and in late June authorised up to $1.25 billion more in potential sales alongside a share buyback. We have covered this pattern closely over the past month, and this week brought a milestone that made the pressure official: Strategy’s mNAV — the ratio of its market value to the actual worth of its Bitcoin holdings — fell below 1 for the first time.

In plain English, the market is now valuing Strategy at less than the Bitcoin it holds is worth. For years, Strategy traded at a premium precisely because investors believed Saylor’s financial engineering added value on top of the raw Bitcoin. That premium has now gone negative. Other digital-asset treasury companies, including Nakamoto, have also been selling. The leveraged treasury flywheel that powered so much of the last two years of institutional buying can, it turns out, run in reverse.

Bitcoin itself fell more than 2% this week to around $62,380, with two-year Treasury yields climbing to 4.29% and traders raising the odds of a July rate hike from roughly 10% to 50% after hawkish comments from Fed Governor Christopher Waller. Renewed tension between the US and Iran, including a blockade near the Strait of Hormuz, pushed oil back toward $80 a barrel — reviving the same inflation fears that drove the summer’s macro turbulence in the first place.

Quick Hits

The Clarity Act.

A merged Senate draft may finally surface as soon as next week, with possible floor action around July 20. It still lacks the Democratic votes needed to pass, with unresolved fights over ethics rules for officials’ crypto holdings and vacancies at both the SEC and CFTC. The window is narrow and getting narrower.

The quantum threat, updated.

We covered the quantum computing risk to Bitcoin a few weeks back, and this week brought another round of "quantum computers could break Bitcoin" headlines worth treating with the same scepticism. New unpublished research estimates roughly 35% of circulating Bitcoin could theoretically be exposed — down from the 50% figure some earlier research suggested. That sounds alarming in isolation, but it is worth remembering two things. First, this is not a Bitcoin-specific problem: the same cryptography protects almost the entire Internet, from online banking to government systems, so the whole world is racing to solve it together, not Bitcoin alone. Second, Bitcoin has a working, tested process for upgrading its own rules, and developers have already been building the post-quantum replacement for months, well ahead of any actual threat materialising. The closer a real quantum computer gets to being dangerous, the faster that upgrade gets finished and rolled out. Industry engineers are also warning against migrating too early, since a rushed switch could introduce fresh vulnerabilities of its own. The risk is real and worth watching. It is not, however, an emergency, and it is very much not unique to Bitcoin.

India leans further towards a ban.

Government documents reviewed by Reuters show India’s central bank has reasserted a policy stance "leaning towards prohibition," recommending banks be barred from any crypto exposure at all. Nothing is law yet, but with nearly 39 million Indian crypto holders and nearly $2.1 billion at stake, it is a significant signal in the wrong direction from one of the world’s largest crypto markets.

The Clarity Act could see floor action the week of July 20. I’ll cover it the moment anything moves. Make sure you’re subscribed.

And Finally…

Somewhere out there, a hobbyist plugged in a credit-card-sized Bitcoin miner called a Bitaxe — the kind of thing you might mistake for a phone charger — and let it run for eight hours at a whisper-quiet 15 to 21 watts. Eight hours later, it found block 957,382 all by itself and earned 3.1382 Bitcoin, worth around $200,000 at current prices.

The odds of a solo miner with that little computing power finding a block are estimated at roughly one in 18,000 years. Twelve solo miners have managed it in 2026 alone, and 24 over the past twelve months — up 41% year on year, helped along by mining difficulty dropping more than 15% since mid-June. Somewhere, a $150 gadget the size of a deck of cards just outperformed most hedge funds’ entire year. Bitcoin remains, among many other things, the world’s most expensive lottery ticket that occasionally actually pays out.

Bitcoin Rallies on Bad News

Two weeks ago Bitcoin was sitting below $58,000 and the mood was grim. This week it staged its best rally since March, climbing nearly 10% to touch $64,000. The trigger was surprisingly mundane: a weak June jobs report showing the US economy added just 57,000 jobs, far below expectations.

Weak jobs data sounds like bad news. For Bitcoin, it was rocket fuel. A soft labour market makes it harder for the Federal Reserve to justify keeping interest rates high, which raises the odds of a rate cut. Traders who had bet against Bitcoin scrambled to cover their positions, and over $450 million in short bets got liquidated in the process — forced buying that pushed the price up even faster.

The rally got a second boost from the ETF market. After ten straight days of outflows through late June, Bitcoin ETFs suddenly reversed course, pulling in $221.7 million on July 3 and $295 million on July 8 — the strongest single day since May. Institutional money that had been heading for the exits turned around and came back in.

Then, right on cue, the Fed reminded everyone that nothing is settled. Minutes from the June meeting, released July 8, revealed nine of eighteen Fed officials are still projecting a rate hike later this year, not a cut. Bitcoin pulled back slightly to around $63,300 on the news. The rally is real. So is the uncertainty underneath it.

Saylor Breaks His Own Rule. Again. Bigger This Time.

Regular readers will remember the moment in late May when Michael Saylor did something he had sworn never to do: sell Bitcoin. It was a tiny amount — 32 coins, about $2.5 million — and Saylor framed it as a show of commitment to preferred stockholders rather than a retreat. The market reacted badly anyway, and the sale became a symbol of how fragile confidence in Strategy’s model had become.

This week, Strategy did it again. This time the number was not small. The company sold 3,588 Bitcoin for roughly $216 million — about a hundred times larger than the May sale, and the biggest single disposal in Strategy’s history.

The proceeds went towards dividend payments across Strategy’s full lineup of preferred stock products: STRF, STRE, STRK, STRD, and STRC, which together make up what the company calls its Digital Credit business. Saylor confirmed the sale covered second-quarter payments on four of those instruments plus the full June payment on STRC specifically.

Here is the detail that matters. None of these preferred products are actually backed by Strategy’s Bitcoin. Each one is simply a claim on whatever assets are left over if the company ever wound down. The dividends have to be paid in cash, and Strategy’s actual software business does not generate anywhere near enough cash to cover them. Grayscale’s head of research estimated the annual dividend bill across all five products at $1.5 billion. When the cash reserve runs low, there are only two options: raise fresh capital, or sell Bitcoin. This week, Strategy chose the second.

Strategy still holds 843,775 Bitcoin and $2.55 billion in cash as of July 5. The sale worked out to roughly $60,201 per coin — notably below where Strategy has been buying, and a reminder of how far Bitcoin has fallen since Strategy’s cost basis of around $75,700 per coin was set. The company is currently sitting on an $8.32 billion unrealised loss for the quarter.

And yet, in the same breath, Strategy keeps buying. After May’s sale, the company turned around and bought 1,550 Bitcoin — nearly fifty times the size of what it had just sold. The pattern is consistent: sell a little to cover the dividend bill, then keep accumulating with fresh capital raised elsewhere. Bernstein’s analysts estimate Strategy has around 17 months of cash coverage for its obligations and still rate the company as unlikely to face forced liquidation. Their year-end Bitcoin price target remains $150,000.

And here is the detail that suggests the conditioning worked. When the small May sale broke news, Bitcoin and STRC both fell sharply — the market read it as a sign of weakness. This time, a sale a hundred times larger landed and STRC did not collapse. It is still below its $100 par value, trading around $88 to $90 this week, but that is a recovery from a low below $75 in late June, not a fresh crash. The board also raised the dividend rate to 12% to help pull it back towards par. A much bigger disposal, absorbed calmly, is exactly the outcome the small first sale was designed to make possible.

Washington Runs Out of Summer

The most important piece of crypto legislation in US history has stalled again. The Clarity Act failed to reach a Senate vote before the July 4 recess, and prediction markets have marked the odds of passage in 2026 down to just 46%.

The sticking points are the same ones we have covered for months: how stablecoins should be regulated, how DeFi protocols should be treated, and — increasingly contentious — what ethics rules should apply to government officials who hold crypto assets while writing the laws that govern them. That last point got considerably more awkward this week.

A financial disclosure revealed that President Trump personally made $1.4 billion from crypto ventures last year, including $636 million from the $TRUMP memecoin alone. In the same week, blockchain analysis showed that close to a million retail investors have collectively lost $3.8 billion buying that same token. Democratic lawmakers, already pushing for stronger ethics provisions in the Clarity Act, now have a very specific and very large number to point to.

If the bill does not move before the Senate’s August 7 recess, the window closes for the year. Midterm politics take over after that, and the odds of anything passing before 2027 or later start to look thin.

Miners Become AI Landlords

Away from the price drama, one of the more interesting long-term trends kept building this week. Bitcoin miner TeraWulf signed a 20-year lease with Anthropic — the AI company behind Claude — to build a 401 megawatt data centre campus in Kentucky. The deal is expected to generate roughly $19 billion in contracted revenue over its lifetime. TeraWulf shares jumped more than 10% on the news.

This is part of a broader pattern we have touched on before. Bitcoin miners sit on enormous amounts of cheap energy infrastructure, and AI companies are desperate for exactly that. Rather than betting everything on Bitcoin’s price, miners are increasingly renting out their power capacity to AI firms for guaranteed, long-term revenue. It is a hedge against Bitcoin volatility that has nothing to do with believing in Bitcoin any less — it is just good business.

The UK Quietly Wins the Regulation Race

While the US Senate argues, the UK’s Financial Conduct Authority quietly published its final crypto rules this week — covering capital requirements, stress testing, and market abuse standards. Firms can apply for authorisation from September 2026, with the full regime taking effect in October 2027.

It is a slower timeline than some in the industry wanted, but it is a genuine, finished rulebook — something the US still does not have. Combined with the FCA’s recent moves on crypto ETNs in pension funds, the UK is positioning itself as a place where the rules are simply settled, while Washington remains stuck in negotiation.

It is worth pausing on how much this represents a genuine turnaround. Not so long ago, the UK’s stance on crypto looked cautious at best — a retail ETN ban that only lifted in October 2025, years of the industry treated as an afterthought while the US and EU built out their frameworks. British politics generally feels like a mess right now, but on this specific issue, the UK has gone from laggard to having a complete, settled rulebook faster than the country that was supposed to be leading the way. Sometimes the quiet regulator gets there first.

The Clarity Act has one more shot before the August 7 recess. I’ll cover it the moment anything moves. Make sure you’re subscribed.

And Finally…

Coinbase’s AI Predicted the World Cup Score Before the Match Started. It Was Wrong.

Coinbase’s new AI-powered notification system this week confidently informed users that Norway had beaten Brazil 3-2, complete with two goals from Erling Haaland. The only issue: the match had not kicked off yet. When the final whistle actually blew, Norway had indeed won — 2-1, with Haaland grabbing both goals just as predicted, plus a late Neymar penalty the AI apparently did not see coming. CEO Brian Armstrong had to publicly step in to investigate his own algorithm’s fortune-telling habit. Half right is still not a passing grade for an AI that was not supposed to be predicting anything in the first place.

Dave Portnoy Has a New Bitcoin Strategy: Stop Trying.

Barstool Sports founder Dave Portnoy, who bought Bitcoin near its $100,000 all-time high, announced this week that he is done trying to time the market. His new plan is to hold “all the way down to zero” if necessary. His reasoning is refreshingly honest: “every time I sell it, it goes nuclear.” A lot of retail investors will recognise that particular flavour of pain.

The President Who Promised to Sign Everything Just Blocked the CBDC Ban

Cast your mind back to last week. The CBDC ban had passed the Senate 85 votes to 5, tucked inside a bipartisan housing bill. It was heading to the President’s desk. We called it practically unstoppable. Then Trump announced he will not sign the housing bill until Congress first passes his SAVE America Act — separate legislation focused on requiring ID for voting.

The SAVE America Act is, in isolation, a perfectly reasonable debate to have. Requiring ID to vote is standard practice in most democracies and a legitimate position to hold. But using it as a lever to block crypto-friendly legislation that had already passed with overwhelming bipartisan support is a different matter entirely. The CBDC ban had nothing to do with voter ID. The housing bill had nothing to do with voter ID. Trump has essentially picked up the digital dollar ban and announced he’s holding it hostage until he gets what he wants on a completely unrelated issue.

The crypto industry — which has invested enormous political capital in Trump over the past two years, including over $135 million in donations during the 2024 election cycle — is watching the President they backed use their legislative wins as bargaining chips in unrelated political fights. For now, frustration is being expressed quietly. But if the Clarity Act goes down as collateral damage, it will not remain quiet.

The Clarity Act: The Window Is Closing

Regular readers will remember our piece on the missing diary entry — the Clarity Act waiting on Tim Scott to schedule a Senate Banking Committee markup. That piece turned out to be more prophetic than we intended. The bill made it out of committee, but it never found its momentum, and now it is in genuine danger.

The July 4 deadline that had been widely cited as the target for Senate passage has come and gone. The Senate is heading into recess. When lawmakers return on July 13, they will have a narrow window of perhaps two to three weeks before the August break consumes the calendar. Three disputes remain unresolved: government ethics provisions — including whether officials can hold crypto assets while writing the laws that govern them — law enforcement access concerns, and market structure rules. Galaxy Research has downgraded the odds of passage in 2026 to 50/50, and those odds feel generous given the current state of play.

The Trump CBDC situation makes everything harder in a specific way. Senate Democrats who voted 85-5 for the housing bill are not feeling cooperative right now. Political goodwill is a finite resource, and the President just spent some of the Clarity Act’s share on an unrelated standoff. If this bill dies in August, the realistic next window — given midterm dynamics, a potential change in House majority, and Senator Lummis leaving in January 2027 — may genuinely be years away.

Why Bitcoin Sat at $60,000 While Everything Else Surged

The US and Iran formally de-escalated this week. Oil prices fell sharply. The Nasdaq surged and the S&P 500 closed out its best quarter since 2020. Global risk appetite returned in a way that, in almost any previous cycle, would have pulled Bitcoin higher with it. Instead, Bitcoin sat stubbornly around $60,000 and barely moved.

The reason is a supply overhang of historic proportions. In June alone, Bitcoin ETFs sold 71,600 BTC while corporate treasuries absorbed just 7,500. Add in newly mined coins and the market is facing a net surplus of roughly 77,000 Bitcoin that buyers are simply not absorbing at current prices — a $4.4 billion imbalance.

June has now officially become the worst month on record for US spot Bitcoin ETFs, with over $4 billion in net outflows, eclipsing the previous record set in February 2025. When supply exceeds demand by that margin, positive macro news does not lift the price. It just slows the fall.

The AI rotation we identified two weeks ago — institutional investors selling liquid assets including Bitcoin ETFs to fund positions in the SpaceX, OpenAI, and Anthropic listings — remains the primary driver. The mega-IPO pipeline is gradually clearing, but June’s outflow record suggests the rotation has not finished. Until ETF inflows return to absorb the excess supply, Bitcoin is effectively decoupled from the broader equity market rally, regardless of how good the macro news gets.

STRC and SATA: Now a Market Problem, Not Just a Strategy Problem

Two weeks ago we wrote that the STRC collapse was a Strategy-specific problem, and that SATA — Strive’s almost identical product — was sitting calmly at $100 as evidence. That picture has changed, and it is worth an honest update.

STRC hit an all-time low of $71.25 on June 26 before recovering slightly to around $74–76 as of June 29–30 — still roughly 25% below its $100 par value. Strategy has maintained its dividend rate at 11.50% for five consecutive months despite the stock trading well below par, which the market is increasingly reading as a signal that management is reluctant to acknowledge the problem formally. Analysts now expect Strategy to raise the rate to 12% or 12.50% at the next reset in order to attract buyers back toward par.

SATA, meanwhile, has also fallen from its $100 par value and is currently trading around $84–85. That is an important development. Last time we wrote, SATA being at par while STRC was at $82 made the story clearly about Strategy’s specific financial decisions. Now that both products are trading well below par, it is harder to sustain that argument. The common factor is Bitcoin’s price. Both products’ capital bases are ultimately tied to Bitcoin treasury strategies, and with Bitcoin down roughly 50% from its October all-time high, the market is repricing the risk across the entire category. SATA is still in better structural shape than STRC — its 18-month cash reserve and debt-free structure remain genuine advantages — but it is no longer immune.

Strategy has responded to the pressure with a new capital management framework: a $2.55 billion US dollar reserve ring-fenced for preferred dividend payments, plus authorisation to sell up to $1.25 billion of Bitcoin if needed. Analysts have broadly welcomed the transparency, even if the prospect of Strategy selling Bitcoin adds to the supply overhang. A company with a clear plan is less dangerous than one that appears to be improvising.

MiCA Lands. 83% of European Crypto Firms Aren’t Ready.

July 1 marked the full enforcement date for MiCA — the EU’s comprehensive crypto regulatory framework. For UK readers this matters both as a signal of where UK regulation is heading and because several platforms you may use operate across European markets.

The numbers are sobering: out of over 1,200 registered crypto entities in Europe, only around 210 have achieved full MiCA authorisation. The remaining 83% face service suspensions. Binance has already suspended new registrations and restricted services in France, Italy, and Spain after failing to secure its licence.

The short-term disruption is real, but the longer-term picture is more interesting. MiCA creates the world’s first unified crypto regulatory framework across 27 countries. Compliant firms now have passport access to the entire EU single market. The 17% who passed the test are in an extraordinarily strong competitive position. The 83% who did not have a compliance problem, not a business problem — which is a very different and more fixable situation. For UK firms, the FCA is watching closely. The UK’s own framework is expected in 2027, and the European failure rate is a warning shot for anyone moving slowly.

And Finally…

CZ Wants to Make America the Capital of Crypto. His Exchange Just Got Kicked Out of Europe.

Changpeng “CZ” Zhao — founder of Binance, the world’s largest crypto exchange — gave an interview this week declaring his personal mission to make the United States the “capital of crypto.” On the same day, Binance was suspending services across France, Italy, and Spain after failing to secure its MiCA licence, effectively being shown the door by 27 European countries simultaneously. The dual headlines ran side by side across crypto news sites. Social media was not subtle about the irony.

CZ attributed the 2026 crypto bear market to artificial intelligence pulling in investment capital, global geopolitical tension, and the Bitcoin halving cycle — which are all genuinely reasonable factors. What he did not mention was the world’s largest crypto exchange failing a regulatory compliance test in the world’s largest trading bloc in the same week. America as the capital of crypto is a fine ambition. Getting a licence in Europe might be a useful warm-up act.

The Clarity Act returns from recess on July 13 with a two-to-three week window before August. That is the next critical date for the most important piece of crypto legislation in US history. I’ll cover it as it develops. Make sure you’re subscribed.

The STRC Story: When ChatGPT Didn’t Model This Scenario

Last week we explained in detail how STRC works — Strategy’s preferred stock product designed to trade at $100 per share and pay an 11.5% annual dividend, with every dollar raised going straight into buying Bitcoin. This week, STRC hit an all-time low of $82.53. For investors who bought at $100 believing the par value was stable, that is a painful and confusing development.

The detail that caught everyone’s attention: Saylor reportedly designed STRC with help from ChatGPT. In a recent interview he described using the AI to engineer the financial structure. Which raises an obvious question — did nobody ask it what happens if Bitcoin drops 50% and your cash reserves run dry at the same time?

Because that is essentially what happened. In May, Strategy used $1.5 billion from its dedicated cash reserve to buy back its own convertible bonds at a discount — sensible housekeeping on paper, but it drained the cushion that was supposed to cover STRC dividends. Coverage fell from 24 months to six. Then Bitcoin slid below $60,000 in early June. CryptoQuant published a formal warning this week saying dividend coverage has since collapsed to just 14 months, cash reserves are down 38%, and annual dividend obligations have quadrupled to $1.2 billion in six months. Their conclusion: Saylor needs to stop buying Bitcoin and rebuild cash.

Strategy currently holds 846,842 Bitcoin at an average cost of $75,656. With Bitcoin at $62,500, that’s an unrealised loss of around $11 billion. Not a crisis in itself — unrealised losses only matter if you’re forced to sell — but enough to rattle markets.

The collapse accelerated for a reason beyond the fundamentals. When STRC first dipped into the $90s, traders spotted what looked like a sure-thing trade. STRC is designed to return to $100. Buy at $95, collect the dividend, sell at $100. Many used leverage to amplify the bet. When STRC kept falling instead of recovering, those leveraged positions got force-liquidated automatically — every sale pushing the price lower, triggering more liquidations, pushing it lower still. A textbook cascade that turned a manageable dip into an 18% collapse.

One can only wonder if Saylor is quietly wishing he’d had access to Claude’s Fable — Anthropic’s most advanced frontier model, which was pulled back because it was simply too smart to release to the public — to stress-test the model before launch. ChatGPT, it seems, didn’t quite run this scenario.

So Why Is SATA Still at $100?

SATA — Strive’s almost identical product, paying 13% — also experienced volatility in mid-June. But it bounced back to par. STRC didn’t. The difference is structural design.

Strive built SATA with an explicit 18-month cash reserve, sized to cover all dividend obligations even through Bitcoin’s worst bear markets. Their CEO pointed to the 2022-2023 crash — when Bitcoin fell from $69,000 to under $16,000 over 18 months — as the stress test benchmark. SATA is engineered to pay through that without selling a single coin. Strategy didn’t maintain the same discipline, and spent down its reserves at the wrong moment.

SATA is currently trading at $99 to $101, raising around $8 million per day in new capital, buying Bitcoin daily. This is not a Bitcoin problem. It is a Strategy-specific problem caused by a specific financial decision. The asset is fine. One product structure had a flaw the market has now found.

The CBDC Ban Nobody Is Talking About

While the STRC drama consumed most of the oxygen this week, something quietly significant happened in the US Senate that deserves more attention than it got.

On June 22, the Senate passed the 21st Century ROAD to Housing Act by 85 votes to 5. It is a bipartisan housing supply bill — the kind of legislation that passes without much fanfare. But buried inside it is a provision that bans the Federal Reserve from issuing a central bank digital currency through December 31, 2030.

In plain English: Congress just made it illegal for the US government to create a digital dollar for the next four years.

A CBDC — central bank digital currency — would be a government-issued digital version of the dollar, where every transaction is visible to the state, and the government could theoretically program money to expire, restrict what it can be spent on, or freeze it entirely. For many Bitcoin holders, it represents the dystopian alternative to everything Bitcoin stands for. And it just got banned.

The reason it matters so much: attaching the ban to a must-pass housing bill dramatically increases the odds it actually becomes law. The House had already passed a standalone Anti-CBDC measure. House Republican leaders have signalled an expedited vote on the Senate-amended bill. This is very close to landing on the President’s desk.

A four-year CBDC moratorium removes a potential government competitor to Bitcoin and private stablecoins. It signals clearly that Congress’s preference is private-sector digital money — which is exactly what the GENIUS Act and Clarity Act are building the framework for. And it passed 85-5. That is not a partisan squeaker. That is a consensus.

BlackRock Says the Next Rally Won’t Be About Crypto

One more story from this week worth holding onto, especially if the short-term price action is getting you down.

Robert Mitchnick — BlackRock’s head of digital assets at the firm managing $14 trillion — gave an interview this week stating that Bitcoin will likely see renewed upward momentum around the 2026 midterm elections. His reasoning had nothing to do with crypto-specific developments. No ETF flows, no halving cycles, no on-chain metrics.

His argument: mounting investor fear about US debt, deficit spending, and the risk of currency debasement will drive the next move. The same forces that historically drove demand for gold — distrust of government money — will drive demand for Bitcoin. He also acknowledged that the AI investment boom has been pulling capital away from Bitcoin, but framed it as temporary.

BlackRock is the world’s largest asset manager. When they build a public narrative around their IBIT ETF during a period of record outflows, they are not doing it for fun. They are signalling to their institutional clients how to think about Bitcoin’s next phase. “Bitcoin wins if Washington cannot fix its deficit problem” is a very specific and credible thesis — and given what we know about Washington’s deficit problem, it is not an outlandish one.

The Clarity Act July 17 hearing is the next major regulatory milestone. A $10.6 billion Bitcoin options expiry hits on Friday June 26 — with 80% of positions currently out of the money. I’ll cover both as they develop. Make sure you’re subscribed.

And Finally…

Apple Nearly Banned the Man Fighting Bitcoin Scammers. The Scammers Were Fine.

Craig Raw is the solo developer behind Sparrow Wallet — widely considered the best Bitcoin desktop wallet in existence. This week he received a notice from Apple threatening to terminate his developer account by June 30. His crime: he built a placeholder app warning users that Sparrow is desktop-only and that the dozen-plus fake “Sparrow” apps on the App Store are scams. Apple’s automated systems classified this as “dishonest activity.” The actual scam apps, which have been stealing users’ savings for years, were untouched. The story went viral, Apple reversed course after a community uproar, and Craig’s account was saved. The scam apps remain on the App Store. Nothing to see here.

The Problem With Bitcoin, According to Wall Street

Ask a traditional investor why they haven’t bought Bitcoin and you’ll usually get one of two answers.

The first is volatility. Bitcoin moves 10%, 20%, 30% in a matter of weeks. For someone whose job is to protect capital and generate predictable returns — a pension fund manager, a retiree, an income-focused investor — that kind of movement is terrifying. The upside is attractive. The ride is not.

The second is yield. Bonds pay interest. Dividend stocks pay quarterly income. Property pays rent. Bitcoin pays nothing. It just sits there. For a huge portion of the investing world, an asset that doesn’t generate income isn’t really an asset at all. It’s a speculation.

BlackRock just solved both of those problems in a single product. And it launched this week.

Meet BITA: Bitcoin That Pays You

The iShares Bitcoin Premium Income ETF — ticker BITA — started trading on Nasdaq on June 16. It is the first Bitcoin income product from a major asset manager, and it works in a way that is worth understanding properly.

Here is the plain English version.

BITA holds two things: direct spot Bitcoin, and shares of BlackRock’s own spot Bitcoin ETF, IBIT, which already has over $100 billion in assets. The direct Bitcoin holding is there for tax efficiency — it allows capital losses to pass through to investors. The IBIT shares are the portion used for the options strategy. Either way, you buy BITA, you own Bitcoin exposure. The fund charges a 0.65% annual fee — higher than IBIT’s 0.25%, but lower than competing income Bitcoin products.

But then it does something clever with that Bitcoin. Every month, BITA sells what are called call options against a portion of its holdings — roughly a quarter to a third. A call option is essentially a contract that gives someone else the right to buy Bitcoin from you at a set price. In exchange for selling that contract, BITA receives a payment upfront. That payment is the income.

Think of it like renting out a room in your house. You still own the house. You still benefit if the house goes up in value. But every month, someone pays you rent, and that rent becomes your income. The trade-off: if house prices rocket above a certain level, the tenant has the right to buy at the agreed price and you miss some of the upside. You gave up a slice of the big gain in exchange for steady monthly payments.

BITA targets a 15 to 25% annual yield from this strategy. To put that in context: the average UK savings account currently pays around 4–5%. A ten-year US Treasury bond pays around 4.5%. BlackRock is offering Bitcoin income that could be three to five times that. The catch is that if Bitcoin goes on a massive run, BITA holders will capture less of it than someone holding Bitcoin directly. But for an investor who needs income rather than speculation, that trade-off is entirely rational.

Robert Mitchnick, BlackRock’s head of digital assets, said the quiet part out loud. “A significant share of our clients are interested in Bitcoin, but they are also highly focused on generating income.” BITA was built for exactly those clients. And BlackRock’s Chief Investment Officer Rick Rieder said on Bloomberg that he thinks “Bitcoin is ultimately going considerably higher.” The world’s largest asset manager is not hedging its view.

One more detail worth knowing: Goldman Sachs was building a near-identical product. BlackRock filed its paperwork on June 11, got SEC approval on June 15, and listed on June 16 — beating Goldman to market. In the race to own the Bitcoin income category, BlackRock moved first and fast.

Who Is This Actually For?

BITA is not for everyone. If you are a long-term Bitcoin holder who believes Bitcoin is going to $200,000, $300,000, or beyond, you probably do not want to cap your upside in exchange for monthly income. Just hold Bitcoin directly and go about your day.

But BITA opens a door for a completely different type of investor who has never been able to own Bitcoin before.

Pension funds have mandates that require income-generating assets. Endowments and foundations need to generate regular distributions to fund their operations. Retirees living off their portfolios need monthly cash flow. Wealth managers running income-focused client portfolios need yield. For all of these investors, Bitcoin with a 15–25% income yield is a fundamentally different conversation than Bitcoin with no yield.

As we recently covered, the UK FCA proposed allowing mainstream investment funds to hold up to 10% of their assets in crypto products. UK authorised funds manage trillions of pounds. BITA-style products are exactly the kind of structured, income-generating Bitcoin exposure that fund managers in those vehicles would actually be allowed to use. The timing is not a coincidence. The infrastructure is being built for a wave of institutional demand that is still arriving.

How Does BITA Compare to STRC and SATA?

If BITA sounds familiar, it should. Two products have been doing something similar for over a year: Strategy’s STRC — the brainchild of Michael Saylor, who has bought more Bitcoin than any other corporate operator on earth — and Strive’s SATA. The principle across all three is the same: use Bitcoin as the engine, build yield on top of it, and attract income investors who wouldn’t otherwise touch crypto. But they work differently, and the risks are different too.

STRC — Strategy’s Stretch product — pays an 11.5% variable annual dividend. It has raised over $8.5 billion and is now the largest preferred stock by market cap in the world. Every dollar raised goes straight into buying Bitcoin.

SATA — Strive’s almost identical product — works the same way but pays 13%, a higher rate that compensates for Strive being a smaller, less liquid company. It now holds over 19,000 Bitcoin and as of June 16 became the first listed security in US capital markets history to pay daily cash dividends rather than monthly. Both STRC and SATA are preferred shares in companies. When you buy them, you are essentially lending money to Strategy or Strive respectively, trusting them to keep buying Bitcoin and paying your dividend. If either company ran into serious trouble, you would be a preferred creditor — ahead of common shareholders, but still exposed to that company’s balance sheet.

BITA works differently. It holds both direct spot Bitcoin and shares of IBIT — not as a company treasury, but inside a regulated ETF structure. The yield comes from selling options on the IBIT portion, not from anyone’s creditworthiness. There is no corporate balance sheet between you and the asset. If BlackRock’s ETF business somehow failed, the underlying Bitcoin would still be there, although since Strategy’s and Strive’s entire business model is Bitcoin accumulation, this is more of a structural difference than a practical one.

The trade-off cuts both ways, and it’s worth being honest about it. STRC pays 11.5% and SATA pays 13% regardless of what Bitcoin does — if Bitcoin doubles, your yield stays the same. But here’s the equally important flip side: if Bitcoin halves, your STRC and SATA dividend still arrives. Both products are actively managed to trade at or near $100 per share at all times, regardless of the Bitcoin price. Your capital position is stable. You put in $100, you expect to get roughly $100 back, and you collect the income on top. It behaves more like a bond than a Bitcoin investment in that respect. You are exposed to company risk, not Bitcoin price risk.

BITA has no such mechanism. Your capital moves with Bitcoin — roughly 70% of every price swing, up or down. And this creates a subtlety that is easy to miss: the percentage yield and the actual cash you receive are two very different things.

Of course, the reverse is also true. If Bitcoin doubles from your entry point, your BITA holding grows to around $17,000, and 18% of that is a very attractive income. STRC holders are still collecting 11.5% on their stable $10,000. In a strong Bitcoin market, BITA wins on both the capital and the income. In a falling market, it loses on both.

In simple terms: STRC and SATA are stable capital, predictable income, company risk. BITA is Bitcoin exposure with an income layer on top — the income and the capital move together with the Bitcoin price. Neither is better. They are different tools for different investors with different needs. All three are targeting income investors who could not justify owning Bitcoin before. Together they represent the beginnings of an entirely new asset class — Bitcoin-native income products engineered for the traditional finance world. (Not financial advice.)

While That Was Happening, the SEC Quietly Did Something Huge

BITA was the headline. But something equally significant happened the same week that received almost no mainstream coverage — and it matters far beyond Bitcoin.

Right now, if you want to buy a share of Apple, your trade settles in two business days. The stock exchange is open Monday to Friday, roughly 8am to 4.30pm. If something dramatic happens to Apple on a Saturday night, you cannot do anything about it until Monday morning. And the paperwork behind every trade runs through a chain of brokers, clearinghouses, and custodians that was built in the 1970s and has barely changed since.

Blockchain fixes all of that. Stocks on a blockchain settle in seconds, not days. Trading is 24 hours a day, seven days a week. The entire chain of intermediaries collapses into code. Costs fall dramatically. Errors are eliminated. Global investors can access any market at any time without going through a web of middlemen.

The technology has existed for years. The problem has been legal. One rule, written in 2005, has been making it almost impossible to do legally in America. Until this week.

On June 11, the SEC proposed scrapping Rule 611 of Regulation NMS — the trade-through rule that has governed US stock market trading for twenty years. Here is why it has been such a problem.

When you buy a share on the New York Stock Exchange, Rule 611 says your trade must execute at the best available price across all US exchanges simultaneously. The intention was good — protect investors from being ripped off. But blockchain trading uses automated systems called liquidity pools that cannot pause a trade to check what every other exchange in America is quoting at the same moment. Under Rule 611, every single trade on a blockchain-based stock market would technically be illegal.

As Galaxy Digital’s head of research Alex Thorn put it, the rule meant any blockchain trading platform would be “committing trade-throughs constantly and arguably be an illegal trading center.”

Christopher Perkins of 250 Digital Asset Management summed up what the change means: “It’s a whole new ballgame.”

The SEC proposal replaces Rule 611 with a simpler “best execution” standard — brokers must try to get the best price for clients, without the rigid mechanical requirement that makes blockchain trading impossible. A final vote is expected by early 2027.

Citi has already launched a platform for tokenised shares of private companies. Nasdaq and the DTCC — the plumbing of the US stock market — are actively building tokenised settlement infrastructure. Citi projects the tokenised asset market could reach $5.5 trillion by 2030. The legal blocker just moved out of the way.

The Bigger Picture: Two Steps Toward the Same Place

BITA and the Rule 611 proposal look like separate stories, but they aren’t.

Both are steps in the same direction: the merger of traditional finance and Bitcoin.

BITA brings Bitcoin into the income-investing world — making it accessible to pension funds, endowments, and retirees who couldn’t justify owning it, or couldn’t legally access it. Rule 611’s removal opens the door for stocks, bonds, and other traditional assets to move onto blockchain infrastructure — making them faster, cheaper, and more accessible globally.

The direction of travel is toward a financial system where Bitcoin and traditional assets occupy the same rails. Where your pension fund owns Bitcoin exposure as part of a yield strategy. Where the Apple shares in your ISA settle on a blockchain in seconds rather than two business days. Where the distinction between “crypto” and “finance” stops making sense because they have become the same thing.

That world is not here yet. BITA is one product. Rule 611 is a proposal, not a law. The Clarity Act is still working its way through the Senate. There is plenty of road still to travel.

But the direction has never been clearer. And the speed has never been faster.

Jamie Dimon called Bitcoin a fraud in 2017. BlackRock — the firm that manages more money than any other on earth — launched a Bitcoin income product this week paying three to five times what his bank’s savings accounts offer. The SEC is dismantling twenty-year-old rules to let stocks trade on blockchain around the clock.

Something fundamental is changing. And this week, you got to watch two more pieces of it fall into place.

The Clarity Act is pushing for a Senate floor vote before the August recess. The FCA consultation on Bitcoin in UK pension funds closes July 13. I’ll cover both as they develop. Make sure you’re subscribed.

Two Very Different Stories, Same Asset

Depending on which numbers you look at this week, Bitcoin is either in serious trouble or sitting in one of the best buying windows in years. The strange thing is both are true.

The price is down more than 50% from its all-time high. The people who bought Bitcoin ETFs after Trump won the election have made nothing — all those gains have been wiped out. Inflation just hit a three-year high. The Federal Reserve is now more likely to raise interest rates than cut them. Google searches for “Bitcoin to zero” just broke their all-time record. And this week, the biggest stock market listing in history launched, pulling enormous amounts of money away from Bitcoin and into a rocket company.

At the same time: the wealthiest, most sophisticated Bitcoin investors just bought hundreds of millions of dollars worth at the low and locked it away in cold storage. The UK’s financial regulator proposed opening the door for mainstream pension funds and ISAs to hold Bitcoin. Japan’s three largest banks announced they’re building a stablecoin together. The most important piece of US crypto legislation in history still has a 60% chance of passing this year. And Michael Saylor — the man who has bought more Bitcoin than anyone on earth — says the selloff has nothing to do with Bitcoin itself.

So what is actually going on? Let’s take each side seriously.

Why the Money Left: Rockets, Robots, and the Biggest IPO Ever

Michael Saylor released a video on June 4 explaining his view of what’s been happening. His argument was simple: this isn’t a Bitcoin problem. It’s a competition for cash problem.

Think about what’s been happening in the technology world this year. Every major company on the planet is pouring money into artificial intelligence. Building data centres the size of small towns. Buying computing chips by the shipload. Wiring up AI infrastructure at a pace and scale the world has never seen. Microsoft, Google, Amazon and Meta alone have committed to spend over $600 billion in 2026, most of it on AI. That money has to come from somewhere.

Then, on top of that, three of the most hyped companies in a generation all decided to go public at the same time. SpaceX — Elon Musk’s rocket company, which we wrote about recently after it disclosed $1.3 billion in Bitcoin on its balance sheet — priced its IPO on June 11. The largest stock market listing in recorded history. Four times more demand than shares available. Then OpenAI — the company behind ChatGPT — filed its paperwork. Then Anthropic. All three targeting listings worth hundreds of billions of dollars each.

When opportunities like that arrive, big institutional investors — pension funds, hedge funds, asset managers — need to raise cash quickly to participate. And to raise cash, you sell whatever you’re already holding. Stocks. Bonds. And yes, Bitcoin.

Saylor’s point is that investors aren’t selling Bitcoin because they’ve stopped believing in it. They’re selling it because they need the money for something else right now. It’s like selling your gold to buy a house. The gold hasn’t become worthless. You just need the cash today.

He warned it could continue for a while yet. OpenAI and Anthropic still haven’t listed. The AI spending wave shows no sign of slowing. “This is going to be the biggest year of IPOs and equity issuance in our lifetime,” he said.

There is one small irony worth mentioning. Saylor made this argument in the same week his own company, Strategy, sold a small amount of Bitcoin for the first time since 2022 — not out of panic, but to cover a routine dividend payment. The amount was tiny. But the market reacted as though the world was ending, triggering a wave of forced selling that sent Bitcoin crashing below $60,000. Strategy bought the dip the following week. But the episode showed how fragile the market had become, and how much it had been leaning on Saylor as a permanent buyer.

Why the Smart Money Is Buying: Whales, the FCA, and Japan

Here’s the thing about panic. It creates opportunities for people who aren’t panicking.

While retail investors were selling and Google was filling up with “Bitcoin to zero” searches, a different group was doing the opposite. On-chain data — which tracks what’s actually happening on the Bitcoin network in real time — tells a striking story. In the five days after Bitcoin hit its low near $60,000, the largest and most sophisticated Bitcoin holders accounted for more than 60% of all the buying. They then took roughly $700 million worth of Bitcoin off exchanges and moved it into cold storage — meaning they have no intention of selling it any time soon.

This pattern has appeared near every major Bitcoin bottom since 2018. The small investors panic and sell. The big investors quietly buy everything they can. It doesn’t tell you exactly when the recovery comes. But it tells you very clearly who thinks prices are cheap right now.

While that was happening, two pieces of regulatory news arrived that barely made a ripple in the mainstream coverage.

The first was from the UK. The Financial Conduct Authority — the FCA, the body that regulates financial products in Britain — published a proposal this week that would allow mainstream investment funds to hold up to 10% of their assets in crypto products. We’re talking about the funds that sit inside your pension, your ISA, your workplace savings scheme. If this proposal goes through, every mainstream fund manager in the UK could put a slice of your retirement savings into Bitcoin exposure.

To understand how significant that is, consider the timeline. Just eight months ago, the FCA lifted a four-year ban on retail investors even accessing crypto products. Then in April this year, Bitcoin products became eligible to hold inside tax-free ISAs. Now they’re proposing to open the entire mainstream fund sector. The speed of that progression is remarkable. The consultation closes July 13 — so this is very live right now.

The second piece of news came from Japan. The country’s three largest banks — institutions that together manage more money than most countries’ entire economies — formally agreed this week to launch a joint digital yen stablecoin by March 2027. This isn’t a research paper. It’s a signed agreement with a commercial launch date. The world’s financial infrastructure is quietly being rebuilt around digital assets, week by week, regardless of what the price chart is doing.

The Lawsuit That Woke Up 14-Year-Old Bitcoin

There’s one more story this week that’s either completely irrelevant or potentially the most dramatic legal event in Bitcoin’s history. Nobody knows which yet — but it’s worth knowing about.

Back in March, someone filed a lawsuit in New York trying to claim legal ownership of roughly 3.8 million Bitcoin — worth around $285 billion — sitting in tens of thousands of wallets that haven’t been touched in years. The argument: the coins have been abandoned, so lost property law should apply.

This week, a wallet that had been completely untouched since 2011 — back when Bitcoin was worth less than a dollar — suddenly moved its coins. Then another dormant wallet moved. Both owners had apparently been notified about the lawsuit via an unusual method: tiny amounts of Bitcoin sent to their wallets with a legal message embedded in the transaction.

The lawsuit is almost certainly going nowhere. Courts aren’t designed for this. But the fact that people who haven’t touched their Bitcoin in 14 years are now moving it to protect it tells you something interesting: those coins aren’t lost. The owners are still out there. Still watching. Still very much not interested in giving them up.

So Which Way Does the Elastic Snap?

The things pushing Bitcoin down right now are mostly temporary. The AI fundraising wave will eventually slow. The mega-IPO queue will clear. The Iran conflict will eventually resolve — one way or another — and oil prices will come off the boil. When inflation eases, the Fed gets room to cut rates. When rates fall, the conditions that drove Bitcoin to its all-time high of $126,000 come back.

The things building beneath the surface are not temporary. The FCA opening UK pension funds to Bitcoin doesn’t reverse. Japan’s stablecoin infrastructure doesn’t get unbuilt. The Clarity Act, if it passes, doesn’t get unpassed. Strategy’s 845,000 Bitcoin doesn’t get unsold. The whales who bought $700 million at $60,000 and locked it in cold storage aren’t selling at $62,000.

The gap between what Bitcoin’s price says right now and what its structural story says has rarely been wider. That gap is the elastic. The price is depressed by temporary forces. The underlying demand is building from permanent ones.

The Fear and Greed Index hit its lowest reading in months this week — lower even than during the FTX collapse in 2022. Every time it has been this low in previous cycles, it has marked the territory where the pain was closest to ending. Not the exact bottom. Not immediately. But the zone where patient buyers are eventually proved right.

The elastic is stretched. Something has to give.

Three things to watch over the next three weeks: the Fed decides on rates on June 17, the FCA consultation on Bitcoin in pension funds closes July 13, and the Clarity Act is pushing for a Senate floor vote before the August recess. I’ll cover each one as it happens. Make sure you’re subscribed.

Bitcoin dropped below $62,000 this week. Your phone is probably full of notifications. People are panicking. And somewhere, someone who bought the dip last Tuesday is now staring at a loss wondering what went wrong.

So let’s slow down and actually look at what happened. Because if you understand the moving parts, the panic starts to look a lot less scary — and a lot more familiar.

The Spark That Wasn’t What It Seemed

On June 1st, Strategy — the company run by Michael Saylor that holds more Bitcoin than any other public company on earth — disclosed in a regulatory filing that it had sold some Bitcoin. The headline spread instantly. “Saylor Sells Bitcoin.” Markets reacted. Bitcoin dropped.

Here’s what people missed: Strategy sold 32 Bitcoin. At around $77,000 each, that’s $2.5 million. Out of an 843,706 Bitcoin stack worth roughly $64 billion. That is 0.004% of their holdings. You could cover it from a decent year’s salary.

So why sell at all?

This is where it gets interesting. Strategy has issued something called preferred stock — specifically a product called STRC — which pays investors a regular dividend, currently at 11.5% per year. That’s a contractual cash obligation. Every month, Strategy must pay it.

Now, Strategy does hold a $900 million USD cash reserve specifically for this purpose. By most calculations they have around 18 months of dividend coverage sitting in dollars. But here’s the thing — that reserve exists precisely to not be touched on a routine basis. Its job is to sit there and signal stability to STRC holders. Every time they draw it down for a monthly payment, that signal weakens.

So why not just use the cash? Because a pile of Bitcoin that you refuse to ever sell isn’t actually cash. If Saylor stood up and said “we will never sell a single coin under any circumstances,” rating agencies and credit analysts would have a very reasonable question: then what exactly backs these dividend obligations? An illiquid asset you’ve promised never to liquidate isn’t collateral. It’s a museum exhibit.

By selling 32 BTC — a number so small it’s almost comical — Strategy sent a clear signal to the financial world: this Bitcoin stack is real, it is sellable, and we will sell it when we need to. As one Wall Street analyst put it after the filing, investors can now view the Bitcoin holdings as a “viable backstop” for dividend funding. That’s actually a stronger case for STRC holders, not a weaker one.

Saylor himself telegraphed this months ago. At Strategy’s Q1 2026 earnings call, he told investors that Bitcoin only needs to appreciate 2.3% per year for the entire BTC stack to cover STRC obligations in perpetuity — without selling common stock. He also said the company expects to buy ten to twenty Bitcoin for every one they sell. This wasn’t a change of conviction. It was a compliance move dressed up as a bombshell by people who didn’t read past the headline.

When Panic Becomes a Cascade

Once the headline hit, something very predictable happened. Traders who had borrowed money to bet on Bitcoin going up — using what’s called leverage — suddenly found themselves on the wrong side of a price move.

Think of it like this. You borrow money to bet that Bitcoin goes to $90,000. Bitcoin drops to $72,000 instead. Your lender doesn’t wait to see if you’re right eventually. They close your position automatically and sell the Bitcoin to recover what they’re owed. You don’t get a say. That’s a liquidation.

When enough of those happen at once, the forced selling pushes the price down further, which triggers more liquidations, which pushes the price down further. The cascade continues until the system flushes itself out.

This week, more than $1.6 billion in leveraged positions were wiped out in a single day. The vast majority were long positions — people who had borrowed money betting Bitcoin would rise. They were right about the direction. Wrong about the timing. And leverage doesn’t give you time.

This is one of the oldest lessons in markets, and it never seems to stick. Leverage amplifies gains when you’re right, and amplifies ruin when you’re wrong. In a volatile asset like Bitcoin, it is a particularly dangerous game.

The ETF Outflows: Rotation Story or Something Else?

On top of all of this, US spot Bitcoin ETFs — the products that let Wall Street investors buy Bitcoin exposure through their normal brokerage accounts — have just recorded their worst week since launching. Eleven consecutive days of net outflows. $3.45 billion pulled in a single week.

The official explanation? Institutional investors are rotating money out of Bitcoin and into AI stocks. Nvidia up 6% in a week. Alphabet up 10%. AI and semiconductor companies are printing extraordinary earnings numbers and drawing capital from everywhere. When one trade is hot, other trades get trimmed. That’s real. That’s happening.

But it’s worth understanding exactly how ETF outflows affect Bitcoin’s price — because it isn’t just sentiment.

When an investor sells their IBIT shares (BlackRock’s Bitcoin ETF), those shares are redeemed through what are called authorised participants — large banks like JPMorgan or Goldman Sachs. Those banks need to hedge their exposure in real time, which means selling actual Bitcoin on the spot market. Immediately. Not at end of day. The arbitrage mechanism between the ETF price and Bitcoin’s underlying price operates in milliseconds. By the time the daily flow numbers get published — and by the time the crypto media reports them as the reason Bitcoin dropped — the price impact has already happened, hours earlier.

That’s the mechanism. Now here’s the question worth sitting with.

The same institutional fund managers who can decide to redeem billions in IBIT shares also manage capital on behalf of clients who benefit from being able to buy Bitcoin at lower prices. The firms executing these trades have full visibility of what they’re about to do, and therefore what effect it will have on the spot price — before anyone else does.

Some analysts have pointed to a $1.29 billion dark pool IBIT block sale in late May, noting that the net redemption that day was only around $192 million. That gap suggests the bulk of that enormous sale may have been bought back by other parties — potentially including the same seller re-entering at a lower price.

Is that what happened? There’s no public evidence confirming it. The official explanation — AI rotation — is entirely plausible and probably true in large part. But the structure of the market means that large institutions operating in IBIT have an informational advantage over everyone else in the system. They know what they’re about to do before the rest of us do. And what they’re about to do moves the spot price.

Make of that what you will.

Everything Else Hitting at Once

It’s rarely one thing. This week had several.

Iran. The US Treasury sanctioned Nobitex, Iran’s largest crypto exchange, while US-Iran ceasefire negotiations are stalling. Geopolitical tension is a risk-off trigger. When people are uncertain about the world, they reduce exposure to volatile assets.

Mt. Gox. The ghost of the 2014 Bitcoin exchange hack refuses to fully disappear. This week, 10,422 Bitcoin worth around $739 million moved to a new wallet as a creditor repayment deadline approaches. Whenever Mt. Gox coins move on-chain, the market flinches — there’s a persistent fear that creditors, who have waited twelve years to get their Bitcoin back, will sell the moment they receive it.

Prediction markets. Traders on decentralised prediction platforms are now pricing a 66% chance Bitcoin falls below $55,000 before year-end. That’s a meaningful data point about crowd sentiment, even if no one knows whether they’re right.

All of it hitting in the same week, on a market already skittish from the Strategy headline and still digesting weeks of ETF outflows, is how you get a 16% weekly drop.

The Other Side of the Picture

Here’s what the panic tends to drown out.

Despite Bitcoin’s worst week of the year, social media sentiment around Bitcoin just hit its most bullish ratio of 2026 — 2.23 positive comments for every bearish one. Retail conviction is, by that measure, exceptionally strong even as institutional capital exits.

The US Strategic Bitcoin Reserve blueprint is due in July. If Congress authorises the Treasury to actively purchase Bitcoin — rather than simply hold the 328,000 coins already seized from criminals — that would represent a structural, permanent floor on demand that no ETF outflow could easily offset.

And the leveraged positions that just got liquidated? That’s the market cleaning itself out. A reset. Every long position that gets forced closed is one less source of future forced selling. Markets that flush this way often recover more cleanly than markets that grind down slowly.

What Should You Actually Do?

Nothing, if you own Bitcoin for the right reasons. (Not financial advice.)

The people being hurt this week are primarily those using leverage, or those who bought with money they can’t afford to keep locked up. If neither of those describes you, a price drop is noise, not signal.

Bitcoin has dropped 16% in a week before. More than once. It has recovered every time. The reasons for owning it — as a fixed-supply, decentralised, un-censorable store of value — haven’t changed because Nvidia is having a good quarter or because a hedge fund needed to raise cash.

What’s worth doing is understanding what actually happened. Because next time a headline says “Saylor sells Bitcoin,” you’ll know whether to read the number first.

Not financial advice. Stay curious, keep learning, and happy stacking.

Three Stories. One Moment.

Sometimes the news arrives in a trickle. Sometimes it arrives all at once.

In the space of a few days in late May 2026, three things happened that individually would have been significant stories. Together, they represent something bigger: the moment Bitcoin went from being a financial asset that institutions were considering to one that governments and the world’s most ambitious companies are already holding.

1. The US government is about to make a formal announcement on its Strategic Bitcoin Reserve.

2. Congress has introduced legislation to buy 200,000 Bitcoin a year by law.

3. And SpaceX — preparing for what could be the largest IPO in history — quietly disclosed it has been holding 18,712 Bitcoin on its balance sheet the whole time.

Let’s take each one in turn.

The Strategic Bitcoin Reserve: From Executive Order to Reality

Cast your mind back to March 2025. President Trump signed an executive order establishing a US Strategic Bitcoin Reserve. At the time, many dismissed it as symbolic. The government would hold its seized Bitcoin — coins confiscated through criminal and civil asset forfeiture proceedings — rather than selling them. No new purchases. No formal framework. Just an order not to sell what they already had.

The US government currently holds an estimated 328,372 Bitcoin — worth around $25 billion at current prices. That makes America the largest known sovereign holder of Bitcoin on the planet. More than China’s estimated 190,000 BTC. More than the UK’s 61,000 BTC. More than El Salvador’s entire stack.

For fourteen months after the executive order, the details remained vague. How was it being custodied? What were the legal authorities? Was it truly a reserve or just a holding pattern?

Last week, Patrick Witt — Executive Director of the President’s Council of Advisors for Digital Assets — changed that. Speaking at Consensus Miami and then again at the Bitcoin 2026 conference, he confirmed the administration has cleared a major legal hurdle. “We’ll have an announcement,” he said. “It’s a breakthrough as far as getting everything in place, legally sound, properly safeguarding the assets.”

The announcement is expected within weeks. What markets want to know: will it include active accumulation — the government actually buying Bitcoin in the open market — or just formalising custody of what they already hold? That distinction matters enormously for price. Witt has not confirmed either way. But the direction of travel is unmistakable.

There’s an irony worth noting. The US Marshals Service — the agency responsible for managing seized assets including Bitcoin — suffered a security breach involving a contractor who allegedly stole funds. Witt cited this as proof that the reserve’s security mandate is urgent. The largest sovereign Bitcoin holder on earth was, until recently, not properly safeguarding its stack. That is now being fixed.

ARMA: Congress Wants to Buy Bitcoin by Law

Executive orders can be reversed by the next president. Laws cannot — at least not without Congress voting to undo them. That’s the significance of ARMA.

On May 21, 2026, Congressman Nick Begich of Alaska and Congressman Jared Golden of Maine introduced the American Reserve Modernization Act — bipartisan legislation to establish a Strategic Bitcoin Reserve in statute, not just executive order. Thirteen co-sponsors signed on at introduction.

The headline number: ARMA would authorise the US Treasury to purchase up to 200,000 Bitcoin annually for five years. Budget-neutral strategies — meaning funded through existing government mechanisms rather than new spending — would be used to acquire up to one million Bitcoin over the life of the programme. If passed, the Treasury’s first open-market Bitcoin purchase is projected for Q4 2026.

Think about what that means in supply terms. The entire global Bitcoin mining network produces roughly 450 blocks a day, yielding around 6,750 new Bitcoin per week — or about 27,000 per month. The US government, under ARMA, would be authorised to buy more than seven times the monthly mining output every single month for five years.

That is not a rounding error. That is a structural shift in demand that would make Strategy’s buying look modest by comparison.

ARMA is still a bill, not a law. It faces the same legislative gauntlet as the Clarity Act. But it has something important going for it: bipartisan support in a political environment where crypto has become genuinely popular on both sides of the aisle. The crypto industry’s investment in the 2024 election cycle — over $135 million spent on political donations — is paying dividends that are hard to ignore.

The most likely vehicle for codifying the reserve into law is the late 2026 National Defense Authorization Act — the annual defence spending bill that almost always passes. That timeline would lock the reserve into federal law before the midterm election cycle dominates everything.

SpaceX: The Disclosure Nobody Expected

On May 20, 2026, SpaceX filed its S-1 with the SEC — the document required before a company can go public. The filing confirmed what Elon Musk had hinted at years ago but never quantified: SpaceX has been holding Bitcoin.

The number buried in the filing: 18,712 Bitcoin, carried at a fair value of $1.29 billion as of March 31, 2026. Cost basis: $661 million. Average purchase price: around $35,324 per coin. That position has roughly doubled in value on paper.

This makes SpaceX one of the largest corporate Bitcoin holders in the world — behind Strategy’s 843,738 BTC and ahead of Tesla’s 11,509 BTC. It places Bitcoin on the balance sheet of a company targeting a $1.75 to $2 trillion IPO valuation. If successful, SpaceX would immediately rank among the ten most valuable publicly traded companies on earth, alongside Apple and Nvidia.

What makes the SpaceX disclosure particularly significant is what it signals about corporate treasury strategy. SpaceX is not a crypto company. It is a capital-intensive aerospace and infrastructure business. It generates $18.7 billion in annual revenue from rocket launches and Starlink satellite Internet. It is loss-making at the operating level — spending heavily on Starship development. And yet it chose to put $661 million of its treasury into Bitcoin at an average price of $35,000.

That decision was made quietly, without announcement, without press releases. It emerged only because going public legally requires disclosing what is on the balance sheet. How many other major private companies have been quietly accumulating Bitcoin without anyone knowing? SpaceX tracked wallets showed only 8,285 BTC before the disclosure — the real holding was more than double what analysts had estimated.

There is also a practical implication for public investors. When SpaceX lists under the ticker SPCX on Nasdaq, buying shares in SpaceX will mean owning indirect exposure to Bitcoin. For millions of investors who can access stock markets but not crypto exchanges — pension funds, retirement accounts, institutional mandates — that creates a new channel for Bitcoin exposure to flow through.

The Pattern Behind the Three Stories

Taken individually, each of these stories is significant. Taken together, they reveal a pattern.

Bitcoin is becoming a reserve asset. Not a speculative trade. Not a retail investment. A reserve asset — something held by governments, by major corporations, by institutional managers — because it performs a function that other assets cannot: fixed supply, no counterparty risk, no central authority that can debase it.

The US government holds 328,000 BTC and is about to formalise the framework. Congress is proposing to buy a million more over five years. Over 140 public companies now hold Bitcoin on their balance sheets. Strategy alone holds 843,000 BTC. SpaceX has had $1.29 billion sitting on its books without telling anyone. BlackRock’s IBIT ETF has pulled in billions in consecutive weeks of inflows.

The supply picture makes this even starker. There are 21 million Bitcoin. Ever. Around 19.8 million have already been mined. Roughly 3 to 4 million are estimated to be permanently lost. The effective circulating supply is shrinking. Exchange reserves have hit seven-year lows. And into that tightening supply, the US government, Congress, and the largest private company in the world are all signalling they want more.

This does not guarantee any particular price outcome in the short term. Markets are messy. Macro headwinds are real — rising bond yields just triggered a billion dollars in ETF outflows in a single week. The Clarity Act still has hurdles to clear. ARMA is a bill not a law.

But the structural direction is clearer than it has ever been. The question of whether Bitcoin would achieve mainstream institutional adoption has been answered. The question now is how fast, and at what price.

What This Means for You

If you already hold Bitcoin, these three stories are validation of the thesis you already believed. The institutions that spent years calling Bitcoin a fraud, a bubble, a Ponzi scheme are now either holding it, buying it, or passing laws to buy more of it.

If you have been watching from the sidelines, this week is a useful moment to ask why. The macro environment is difficult — inflation, war, high rates. Bitcoin’s price has been volatile. None of that has changed the structural story. If anything, the structural story just got stronger.

The US government does not put $25 billion into a reserve asset because it is speculating. SpaceX does not put $661 million onto its balance sheet on a whim. Congress does not introduce bipartisan legislation to buy 200,000 Bitcoin a year without serious conviction.

Something fundamental has changed. And it happened, as these things often do, while most people were looking somewhere else.

The Clarity Act is heading for a Senate floor vote in the coming weeks. I’ll have a full update the moment something significant happens. Make sure you’re subscribed so you get it first.

The Headline That Went Everywhere

No — quantum computers cannot crack Bitcoin in 9 minutes, and none capable of threatening Bitcoin exist yet. Google’s research paper only estimated what it would take: a machine with 500,000 stable qubits, nearly 5,000 times more than Google’s current 105-qubit chip. That’s the real story lost in the panic headlines — and Bitcoin’s developers are already building the fix.

Here’s what Google actually said. Their researchers published a paper estimating that a quantum computer with around 500,000 stable physical qubits could theoretically break the cryptography protecting Bitcoin wallets. Not that it had happened. Not that such a machine exists. That IF you built one, here is roughly what it would cost in computing terms.

For context: Google’s current most powerful quantum chip — the Willow chip — has 105 qubits. The gap between 105 and 500,000 is not a software update. It is years, possibly decades, of engineering that nobody has solved yet.

The paper’s actual value is precise: it tightened the resource estimates so defenders can plan more accurately. It said “here is what you need to build to break this.” It did not say anyone has built it, or when they will.

Why Quantum Computers Are Different

To understand the threat, you need to understand one thing about how Bitcoin security works.

Every Bitcoin wallet has two keys. A private key — your secret, never shared, the thing that lets you spend your Bitcoin. And a public key — mathematically derived from the private key, visible to the network when you make a transaction.

The security of Bitcoin rests on one mathematical fact: you can go from private key to public key easily, but you cannot go backwards. Not in any reasonable timeframe. A classical computer trying to reverse-engineer a private key from a public key would take longer than the age of the universe.

Quantum computers change that equation. They run a process called Shor’s algorithm, which can solve the specific type of maths underlying Bitcoin’s cryptography exponentially faster than any classical machine. In theory, a sufficiently powerful quantum computer could derive your private key from your public key in minutes.

In theory. On a machine that does not exist yet. With qubits that are stable enough to sustain the calculation — a problem nobody has solved at scale.

But Here’s What the Headlines Miss

This is not a Bitcoin problem. It is an Internet problem.

The same cryptographic systems that protect Bitcoin wallets protect your online banking. Your email. HTTPS — the padlock in your browser. SWIFT transfers. Stock exchanges. Military communications. Every encrypted message sent by every government on earth.

If a quantum computer capable of breaking Bitcoin’s cryptography were built tomorrow, the first targets would not be crypto wallets. They would be bank servers, government databases, and financial infrastructure. The stakes for those institutions dwarf the entire crypto market.

Which means every government, every bank, every military, and every major technology company on the planet has a massive incentive to solve this problem before it becomes real. And they are all working on it. Google committed in March 2026 to transitioning its entire infrastructure to post-quantum cryptography by 2029. NIST — the US standards body — has already finalised post-quantum cryptographic standards. The world is not sitting still.

The Number That Should Get Your Attention

In April 2026, an independent researcher named Giancarlo Lelli did something that made the crypto security community sit up. He broke a 15-bit elliptic curve cryptography key using publicly available quantum hardware, winning a 1 BTC bounty from quantum security firm Project Eleven.

Before you panic: Bitcoin uses 256-bit encryption. A 15-bit key versus a 256-bit key is not a small gap. The difficulty scales exponentially, not linearly. Breaking a 15-bit key is impressive in a research context. Breaking a 256-bit key would require a machine roughly a billion times more powerful than anything that currently exists.

But here is why it matters. This result represents a 512-fold improvement over the previous public demonstration from September 2025. The curve is moving in one direction. Bernstein, the Wall Street research firm, put it plainly: Bitcoin and the broader crypto ecosystem have a three to five year window to complete a transition to post-quantum security before the risk becomes acute.

What Bitcoin Developers Are Actually Doing About It

This is where the story gets genuinely interesting — and where most of the media coverage has fallen short.

Bitcoin’s developer community has been working on this problem for years. Satoshi Nakamoto himself acknowledged in early forum posts that if quantum computing became practical, Bitcoin could migrate to stronger signature schemes. The upgrade flexibility was always part of the design philosophy.

In February 2026, Bitcoin Improvement Proposal 360 — BIP-360 — was officially published. It introduces a new address type called Pay-to-Merkle-Root (P2MR), which removes the specific part of Bitcoin’s current architecture that is vulnerable to quantum attack. Any Bitcoin moved into a BIP-360 address will be quantum-resistant. BIP-360 is already in testnet implementation. New addresses starting with “bc1z” will be the quantum-hardened option when it activates.

Then in April 2026, Jameson Lopp — one of the most respected names in Bitcoin security — and five co-authors published BIP-361, titled “Post Quantum Migration and Legacy Signature Sunset.” This is the more controversial proposal, and it deserves plain English treatment.

The Satoshi Coin Problem

Here is the uncomfortable reality that BIP-361 is trying to address.

Approximately 6.7 million Bitcoin — roughly a third of all coins that will ever exist — currently sit in address formats that expose their public keys directly on the blockchain. This includes an estimated 1.1 to 1.7 million Bitcoin widely believed to belong to Satoshi Nakamoto, currently worth around $74 billion. These coins have never moved. Their public keys are visible. A sufficiently powerful quantum computer could theoretically derive the private keys and drain them.

BIP-361 proposes a structured solution: give holders years to migrate to quantum-safe addresses. Those who migrate lose nothing. Those who do not migrate by a defined deadline would have their coins frozen — permanently inaccessible, removed from circulating supply.

The debate this has ignited is fierce. The Bitcoin community is deeply principled about property rights. The idea that anyone — even the network itself — could effectively confiscate coins that have not been moved is deeply uncomfortable for many long-term holders.

The counter-argument: those coins are either lost forever anyway, or they represent a ticking time bomb. If a quantum attacker drains Satoshi’s wallet and dumps 1.1 million Bitcoin onto the market, the effect on price and confidence would be catastrophic. Freezing them removes the risk and, as Satoshi himself once noted, permanently lost coins function as a donation to the rest of the network by making everyone else’s coins slightly more scarce.

BIP-361 is still a draft. It has no activation parameters defined. It will face an extended, contested debate before anything happens. But the fact that serious Bitcoin developers are proposing it tells you something important: the quantum timeline is being treated as real.

A Word on Quantum Marketing

Before we get to what you should actually do, it is worth pausing on something that happened at the Bitcoin 2026 conference in Las Vegas. A company called Qastle was announced as the Official Quantum Wallet of The Bitcoin Conferences through 2032 — a six-year exclusive deal with BTC Inc. Their claim: the world’s first quantum-secured hot wallet.

The Qastle wallet uses quantum random number generation to create keys, and applies post-quantum cryptographic methods to protect the wallet itself. That is genuinely better than nothing. Stronger key generation is a real improvement.

But here is what it does not solve, and what the marketing does not make clear. The quantum threat to Bitcoin is not about how your wallet generates keys. It is about what happens to your public key once it is on the blockchain.

When you broadcast a Bitcoin transaction — regardless of which wallet you use — your public key is exposed to the entire network. That is how the protocol works. A quantum attacker is not targeting your wallet soIf you found this useful, share it with someone who saw the scary headlines and assumed the worst. And if you’re not yet subscribed, this is what you get every week — the story behind the headline, in plain English.ftware. They are looking at public keys sitting on the blockchain and using Shor’s algorithm to reverse-engineer the private key from the public one. No wallet-side protection changes that. The attack surface is on-chain, not in your app.

Think of it this way. Imagine you have a very secure safe at home. Quantum-grade locks, unbreakable. But the key to that safe is printed on a public noticeboard. Someone with the right tools can copy the key from the noticeboard and walk straight past your safe. The safe’s security is irrelevant to that attack vector.

The real fix is what BIP-360 is building: a new address type at the protocol level that keeps public keys off-chain entirely, so there is nothing for a quantum attacker to work with. That requires a Bitcoin network upgrade — a soft fork that every node and wallet on earth adopts together. No single wallet company can do that alone, no matter how good their key generation is.

When you see “quantum-resistant wallet” marketing, it is worth asking exactly which threat they are protecting against. Securing the wallet itself is useful. Claiming to solve the on-chain public key exposure problem without a protocol-level upgrade is a different thing entirely.

What Should You Actually Do?

Calm down. You do not need to do anything drastic right now. But you should understand a few practical points.

Your Bitcoin address is not the same as your public key. In most modern wallet setups, your public key only becomes visible when you spend Bitcoin from an address. If you have never spent from a particular address — you only received into it — your public key is not yet exposed. This is a meaningful layer of protection that most coverage misses entirely.

Do not reuse addresses. Every time you spend from an address, your public key becomes visible. Using a fresh address for each transaction is good security practice anyway. It limits your exposure significantly.

Move away from legacy address formats. If your wallet uses addresses starting with “1” (the oldest format), consider moving to modern addresses starting with “bc1”. The 2026 consensus among security researchers: migrate to native SegWit or Taproot addresses. Ledger and Trezor have already released updated firmware making this straightforward.

Watch for BIP-360 activation. When quantum-safe addresses become available on mainnet — likely within the next one to three years if development continues at current pace — moving your long-term holdings there will be the right call. You will have plenty of time and warning before that matters.

Bitcoin has survived every existential headline thrown at it for fifteen years. The quantum threat is the most technically serious long-term challenge it has faced. But it is also the most anticipated, the most studied, and the one the entire global technology industry has a shared interest in solving. The window is three to five years. The tools are being built.

The Bigger Picture

There is something worth stepping back to appreciate here.

Bitcoin was designed to be upgraded. Satoshi built the upgrade mechanism in from the start, specifically acknowledging that cryptographic standards would need to evolve. The Bitcoin Improvement Proposal process exists precisely for moments like this. The fact that serious proposals are being debated openly, that testnet implementations are already running, that the timeline is measured in years rather than months — all of that is the system working as intended.

The alternative — a protocol that could not adapt to emerging threats — would be far more worrying. What we have instead is a global community of security researchers, developers, and cryptographers working openly on a known problem with a clear timeline.

That is not a crisis. That is engineering.

Q: Can quantum computers steal Bitcoin right now?

A: No. Breaking Bitcoin’s encryption would need a quantum computer roughly a billion times more powerful than the biggest one that currently exists.

Q: How long until quantum computers are a real threat to Bitcoin?

A: Security researchers estimate a three-to-five-year window before the risk becomes serious, based on the pace of recent quantum hardware demonstrations.

Q: What is Bitcoin doing to protect against quantum computers?

A: Developers have proposed BIP-360, a new quantum-resistant address format (addresses starting “bc1z”), already in testnet — plus BIP-361, a more contested proposal to migrate old, exposed coins like Satoshi’s.

If you found this useful, share it with someone who saw the scary headlines and assumed the worst. And if you’re not yet subscribed, this is what you get every week — the story behind the headline, in plain English.

The Moment Nobody Saw Coming

On April 21, 2026, Admiral Samuel Paparo — a four-star US Navy admiral and commander of US Indo-Pacific Command — sat before the Senate Armed Services Committee and said something nobody expected.

The US military is running a live node on the Bitcoin network.

Not studying it from a distance. Not reviewing academic papers about it. Running a node. Participating directly in the peer-to-peer network. Conducting operational tests to secure and protect military communications using the Bitcoin protocol.

He told Congress the military has a node on the Bitcoin network right now, running operational tests to secure and protect networks, describing Bitcoin as showing incredible potential as a computer science tool.

Then he said something even more striking. He called Bitcoin a tool for American power projection. Anything that supports all instruments of national power for the United States of America, he said, is to the good.

A sitting US military commander, in front of Congress, describing Bitcoin as an instrument of national power. Not a speculative asset. Not a payment method. A strategic tool in the competition with China.

Why a Bitcoin Node, Specifically?

To understand why this matters, it helps to know what a Bitcoin node actually does.

When you run a Bitcoin node, you download and independently verify the entire history of every transaction ever made on the network. You become your own source of truth. You do not trust anyone else’s version of events — you check it yourself. That is the zero-trust architecture Paparo was referring to.

In military communications, trust is an existential problem. Traditional systems rely on centralised authorities — trusted servers, certificate authorities, central verification points — all of which create single points of failure. A sophisticated adversary who compromises one of those points can manipulate everything downstream.

Bitcoin’s architecture solves this differently. There is no central point to compromise. There are tens of thousands of nodes distributed around the world, each independently verifying the same truth. To alter it, you would need to simultaneously control 51% of all the computing power in the network — a feat requiring more energy than most countries use annually.

That is what Paparo means by proof-of-work imposing cost. Attack attempts are not just technically difficult. They are prohibitively expensive in the physical world. That property is genuinely useful for military communications and network security.

The China Dimension — and the Iranian Twist

The hearing was not happening in a vacuum. Senator Tommy Tuberville asked Paparo directly: could US leadership in Bitcoin give America an edge against China in the Indo-Pacific?

Paparo did not deflect. He said Bitcoin supports all instruments of American national power and referenced dollar dominance approvingly.

China has been building its own digital currency — the digital yuan — for years. The design is the polar opposite of Bitcoin: centralised, government-controlled, every transaction visible to the state. Beijing has been running cross-border payment projects specifically designed to settle international trade without touching the US dollar or the SWIFT system. Several nations are participating. The dollar’s grip on global trade is the target.

And here is the extraordinary detail that nobody in mainstream media is connecting. Iran — the country whose conflict with the US and Israel has been driving oil prices up 60% and causing the inflation that has made the Fed’s life impossible — is now demanding Bitcoin for safe passage through the Strait of Hormuz.

The same strait. The same oil shock. The same inflation driving up energy bills everywhere. And Iran is pricing access to it in Bitcoin, not dollars, not yuan.

A US military commander is running a Bitcoin node. Iran is accepting Bitcoin for Hormuz toll payments. Taiwan is reportedly considering Bitcoin as a reserve asset. The geopolitics of Bitcoin have changed completely in the space of months.

From Fraud to National Security Asset

It is worth taking a moment to appreciate how far this has come.

In 2017, Jamie Dimon called Bitcoin a fraud and threatened to fire any trader caught buying it. The SEC spent a decade suing crypto companies rather than writing rules for them. The US government position as recently as 2022 was essentially: dangerous speculative bubble, regulate it out of existence.

In April 2026, a four-star admiral tells Congress it is a tool of national power. SEC Chair Paul Atkins became the first sitting US securities regulator to address the annual Bitcoin conference, announcing Project Crypto, a Commission-wide initiative to modernise rules for digital assets. The Strategic Bitcoin Reserve is executive policy. JPMorgan customers can buy Bitcoin through the app.

The establishment did not just accept Bitcoin. It recruited it.

Trump, the Banks, and a Deadline

While Paparo was testifying in Washington, something equally significant was happening in Palm Beach.

On April 25, President Trump addressed a private gathering at Mar-a-Lago that included Tether CEO Paolo Ardoino, ARK Invest’s Cathie Wood, billionaire Tim Draper, and several hundred of the top holders of his $TRUMP memecoin. He used the platform to deliver a direct warning to the banking lobby.

He said he would not allow banks to block the Clarity Act. He pledged to sign it immediately if Congress sends it to his desk. He described crypto as having become mainstream and framed the Clarity Act as essential for keeping the industry onshore. Banks need to make a deal, he said. They do not get to veto this.

This matters because the banking lobby has been the Clarity Act’s main obstacle for months. Banks have been fighting the stablecoin yield provisions — the rules that would allow regulated platforms to offer returns on dollar stablecoins. Their stated concern: it would pull deposits out of the banking system. Their real concern: competition from a product paying 10-12% when their savings accounts pay 0.07%.

The Clarity Act missed its April Senate Banking Committee markup deadline. The window is now May — specifically the week of May 11, the first possible date after the Senate returns from recess. Senator Moreno has said it must clear Congress by end of May or risk waiting until 2030. Lummis confirmed at the Bitcoin 2026 conference that the markup will happen in May. Moreno has gone further, saying he expects Trump to sign it before July 4th.

Prediction market odds have recovered to around 60-69% following the stablecoin yield compromise and Trump’s direct intervention. Galaxy Research still puts it closer to 50-50. The honest answer: the next three weeks will decide it.

What It All Means

In the space of a few days in late April 2026, Bitcoin moved from being a financial asset debated in Senate committee rooms to being described as an instrument of military power, a tool of dollar dominance, and a direct challenge to Chinese geopolitical ambitions.

None of that changes what Bitcoin actually is. The protocol has not changed. The 21 million coin supply cap has not changed. The decentralised architecture that makes it resistant to control by any single party — including the US military — has not changed. One government node out of 15,000 to 20,000 publicly reachable nodes does not give anyone control of anything.

But the way the most powerful institutions in the world are talking about Bitcoin has changed completely. And when a four-star admiral tells the US Senate that Bitcoin is a tool of national power in the same week the President is threatening banks to get out of its way, that is not a moment to scroll past.

Jamie Dimon called it a fraud in 2017. His customers can buy it through his app today. The US military is running a node on the network. Iran is using it to charge tolls on the world’s most strategically important waterway.

The fraud is doing rather well.

The Clarity Act markup is expected in the week of May 11. Full breakdown as soon as it happens. Make sure you’re subscribed so you get it the moment it lands.

What Bitcoin 2026 Told Us About Who’s Really Buying

I just got back from Bitcoin 2026 in Las Vegas, and I want to share what it actually felt like on the ground — because the vibe told a story that no price chart can.

Walk the exhibition floor at an event like this and you can read the room very quickly. Some stands were buzzing. Others were quiet. And once you noticed the pattern, it was impossible to unsee.

The busy stands? Financial products. Bitcoin lending, institutional-grade custody, structured investment vehicles, tradfi integrations. The quiet ones? Hardware wallets. Consumer-facing security products. Retail kit.

That contrast tells you almost everything you need to know about where we are in this cycle.

Not everything on the floor was institutional, of course. The Bitcoin Bazaar — the more eclectic end of the exhibition — had its own energy. My unexpected highlight was Panties for Bitcoin, an Italian underwear brand doing exactly what the name suggests - and no, live models were not present at the stand in case you were wondering. A special mention must go to Coin Vigilante, who were showing off some genuinely impressive Bitcoin-themed watches. If nothing else, it proved that the Bitcoin rabbit hole leads to some wonderfully unexpected places.

The Consumer Is Sitting This One Out — But Which Consumer?

It’s easy to forget — when you’re deep in the Bitcoin world — that most people are not in a position to invest right now. Inflation has eaten into savings. Fuel is expensive. Unemployment is rising. The economic mood in most Western households is cautious, not adventurous.

Phase 1 retail are the OGs. The people who bought Bitcoin directly, set up hardware wallets, took self-custody seriously, and learned what a seed phrase was before most people had heard the word blockchain. They accumulated on-chain, they understood what they owned, and they cared deeply about the independent, self-sovereign side of Bitcoin. For them, it was never about fiat returns — it was about accumulation. Stack sats, hold the keys, trust no-one.

The problem is, many of them are tapped out. They’ve been buying through multiple cycles, they’re either fully allocated or running low on fresh fiat, and with the broader economy squeezing household budgets, there isn’t much left to deploy. The quiet hardware wallet stands at Bitcoin 2026 weren’t a sign that Phase 1 retail has lost interest. They’ve just run out of ammunition for now.

Phase 2 retail is a different animal entirely. This is old money — people who’ve never thought about self-custody and never will. They don’t want to manage seed phrases or worry about hardware wallets. What they heard was their broker say something like: “You should probably put a few percent of your portfolio into Bitcoin.” Neither of them fully understood it. Both of them said yes. And so the money went in — through an ETF, through a brokerage account, as a line item in a portfolio review. Phase 2 retail isn’t buying Bitcoin because they believe in sound money. They’re buying because they want fiat returns, and the number has been going up.

Phase 1 was about accumulation. Phase 2 is about performance.

So when people say retail is sitting out this cycle, what they really mean is Phase 1 retail. And the likely reason the quiet stands were quiet is that the Phase 1 crowd — the self-custody, hardware wallet, on-chain buyers — are either already fully in or simply waiting until they have more cash to deploy.

When they do? They’ll be back.

In the meantime, there’s actually an interesting thought worth exploring — and we’ll come back to it later in this article. (Not financial advice.)

Wall Street Showed Up

Institutional money has been accumulating throughout that dip. BlackRock’s iBit ETF and its peers have been steadily absorbing supply into what are essentially paper portfolios — Bitcoin held on behalf of institutional and retail investors through traditional brokerage accounts. That flow has been consistent and significant.

But it’s one company that has really been driving the demand conversation in 2026, and it’s not a fund. It’s Strategy — better known by its former name, MicroStrategy — run by Michael Saylor.

Strategy alone, through just one of its products, has been buying more Bitcoin per week than the entire network produces through mining. Let that sink in. One company, one product, outpacing the entire global supply of new Bitcoin. That kind of sustained buy pressure has only one likely effect on price over time.

But the more interesting question isn’t how much Bitcoin Saylor is buying. It’s how.

Saylor Took Apart the VCR

Here’s an analogy that might help.

When you were a kid, maybe you pulled apart an old piece of electronics — a VCR, a radio, whatever — just to see what was inside. Most people put it back together (more or less). A few geniuses looked at the components and thought: what if I could use these parts to build something entirely new?

Michael Saylor did that to the traditional financial system. Except he didn’t just take it apart and put it back together. He studied every component, identified what each one was capable of, and then rebuilt the whole thing with Bitcoin at the centre — turning the old VCR into something that runs at 8K with 3D surround sound.

He studied the existing capital markets — the bond market, the preferred stock market, the convertible note market — not to plug back into them in the usual way, but to identify every pool of capital that was sitting trapped in low-yield, legacy instruments. Pension funds earning 4% on bonds. Money market investors getting 5%. Fixed income portfolios desperate for yield but constrained by mandates that say they can’t just buy Bitcoin outright.

Then he built products specifically designed to unlock each of those pools and pipe that capital directly into Bitcoin.

The product getting the most attention right now is STRC — nicknamed “Stretch.” It’s a perpetual preferred stock that pays a variable dividend currently running around 11.5%. To put that in context: the US bond market pays around 4–5%. Money market funds are similar. STRC is offering roughly double that, backed by Bitcoin as collateral.

In just nine months, STRC scaled to $8.5 billion in notional value — making it, by Saylor’s own account, the largest preferred stock by market cap in the world. He put annual growth for the programme at around 350%, with April inflows alone pointing toward $38 billion a year when annualised.

Strategy isn’t just buying Bitcoin. It’s building a flywheel. STRC attracts fixed income capital. That capital buys Bitcoin. More Bitcoin on the balance sheet improves the collateral coverage. Better coverage attracts more conservative investors. More capital buys more Bitcoin. Repeat.

The capital pools Saylor is targeting are enormous. The global corporate bond market is estimated at around $100 trillion. US money market funds hold over $6 trillion. These aren’t niche pools — they’re oceans. And right now, most of that capital has no direct path into Bitcoin. Saylor is building the pipes.

The BTC Loan Market Is Coming

One of the quieter but more significant themes at the show was the emergence of Bitcoin-backed lending.

The basic concept is simple: if you hold Bitcoin and need liquidity — cash for a house purchase, a business investment, a tax bill — you currently face an uncomfortable choice. Sell your Bitcoin (and lose your position, and probably trigger a taxable disposal), or sit tight and stay illiquid.

Bitcoin lending changes that equation. You lock your Bitcoin as collateral and borrow against it. You get the cash you need. You keep your Bitcoin. And critically, you haven’t sold — so there’s no disposal event, which means no capital gains tax to pay.

Remember those Phase 1 retail buyers sitting on the sidelines with no fresh fiat to deploy? A Bitcoin-backed loan is one way to unlock liquidity from what they already hold, without giving up their position. Worth knowing about. (Not financial advice.)

Several companies at Bitcoin 2026 were building in this space, and the energy around their stands was notably different from the consumer products area. The interest was serious, and more than a few of them hinted that the current product offering is just the beginning. There’s more coming — enough that this topic probably deserves a whole article of its own.

Lightning Hit the High Street — Sort Of

And then there was the moment that actually made me smile.

Jack Dorsey’s Block — the company behind Square payment terminals and the Bitkey hardware wallet — made a series of announcements at the conference. The one that landed for me was the Square tap-to-pay for Bitcoin Lightning.

I made my first ever Lightning payment at the event. Bought a Bitcoin 2026 t-shirt. It was fast, it was simple, and it felt genuinely different from the usual crypto payment experience — no waiting, no fee theatre, no uncertainty.

The only friction I hit was muscle memory. I instinctively went to tap my phone, as you would with Google / Apple Pay but it didn’t work. I had to use the QR code instead, which was ok, but the experience wasn’t quite there yet.

Then the next day, Block announced on the main stage that Square is on track to make Bitcoin payments at the point of sale as seamless as Apple Pay — using NFC hardware with no QR codes required, zero processing fees through 2026.

They’d literally announced the solution to the exact problem I’d encountered the day before. I’ll take that as a sign.

When you can tap your phone to pay in Bitcoin the same way you tap for your morning coffee, the “it’s too complicated” objection disappears. That moment is getting closer.

What This All Means

Bitcoin 2026 painted a picture of an asset class in transition. The retail chapter of this cycle isn’t over — it hasn’t really started yet. Consumer participation typically comes later, once prices have moved and FOMO kicks in. That’s the historical pattern.

What’s happening now is the institutional foundation being built beneath the market. Wall Street is accumulating. Saylor is engineering new pipes for trillions of stuck capital to flow through. Bitcoin lending is creating new ways for holders to access liquidity without selling. And Lightning is getting close enough to Apple Pay that “too hard” stops being a valid excuse.

The quiet stands and the busy ones told the same story. The money that moves markets is already here. The money that moves culture — everyday people buying, holding, and spending Bitcoin — is still on its way.

It might be arriving sooner than the exhibition floor suggested.

The Stars Have Never Been More Aligned

Cast your mind back to two years ago. The SEC was suing crypto companies. The CFTC and SEC were fighting each other over who got to regulate Bitcoin. Banks were banned from holding digital assets. The idea of a pro-crypto White House felt like a distant fantasy.

Now look at where things actually stand.

The President signed an executive order creating a Strategic Bitcoin Reserve and has promised to make America the crypto capital of the world. The SEC chair endorsed the Clarity Act publicly and jointly confirmed with the CFTC that Bitcoin is a commodity, not a security. The CFTC chair signed a formal agreement with the SEC to harmonise crypto regulation. The Treasury Secretary posted on social media demanding the Senate Banking Committee pass the bill. The House already did its part — 294 votes to 134 in July 2025. And the main sticking point that held the Senate up for months, the stablecoin yield dispute, now has a compromise framework that’s broadly holding.

Every lever that needed to move has moved. This is the most favourable environment for Bitcoin legislation America has ever seen.

And the bill is still sitting on Tim Scott’s desk waiting for him to put a date in his diary.

What the Clarity Act Actually Does

We’ve covered the Clarity Act in detail in a previous piece, but here’s the short version of why it matters so much right now.

The March 17 joint SEC-CFTC interpretation already confirmed that Bitcoin is a commodity — not a security. That was a huge step. But it’s regulatory guidance. The next administration could reverse it. A hostile SEC chair could reinterpret it. It’s written in pencil.

The Clarity Act writes it in permanent marker. It makes Bitcoin’s commodity status federal law. No future regulator can undo it without Congress acting. That distinction matters enormously to the institutional money that’s now sitting on the sidelines wondering whether to commit.

But that’s just the start. Without the Clarity Act:

• Bitcoin payments remain dead in the water. Every time you spend Bitcoin it’s a taxable disposal, triggering capital gains reporting regardless of the amount. The technology to spend Bitcoin instantly and cheaply exists — Jack Dorsey’s Square is rolling it out to millions of merchants right now. The tax reporting burden is the wall. The Clarity Act creates the framework for a de minimis exemption that could finally fix this. Without it, there’s no route forward.

• Stablecoin yield stays in legal limbo. The GENIUS Act already banned stablecoin issuers from paying yield directly to holders. The unresolved question is whether third-party platforms — exchanges like Coinbase — can offer yield on stablecoins. That matters enormously. Yield is the incentive that makes people hold stablecoins rather than just use them to move money. Without yield, the digital petrodollar thesis weakens significantly. People in Turkey or Argentina will use dollar stablecoins to transact. But will they store their savings in something that pays nothing when alternatives exist? The Clarity Act is supposed to resolve this. Without it, the grey zone continues and the opportunity shrinks.

• Bitcoin’s legal status stays fragile. BlackRock’s Bitcoin ETF has over $50 billion in assets. Strategy just crossed 815,000 Bitcoin — adding 34,164 BTC in a single purchase on April 20 alone. The entire institutional infrastructure built around Bitcoin’s commodity status is technically built on regulatory guidance that could be challenged. The probability of reversal is low given the weight of money now behind it — but low isn’t zero. Only the Clarity Act makes it permanent.

The Clock

Here’s the brutal arithmetic of where things stand today.

The Senate returned from Easter recess on April 13. The Banking Committee has two working weeks left in April before the Senate calendar gets consumed by other business. Senator Moreno has said publicly that if the bill doesn’t reach the Senate floor by May, midterm election dynamics effectively kill it for 2026. Senator Lummis — the bill’s most committed champion — has gone further, warning the window may not reopen until 2030.

Tim Scott, the Banking Committee chairman, told Fox Business on April 14 that the markup may not happen in April at all. He named three remaining issues: stablecoin yield language, DeFi provisions, and securing all Republican votes on the committee. He said each could be resolved within two weeks. The industry took that as a May timeline at the earliest.

Ripple’s CEO Brad Garlinghouse, who predicted in February that he’d give 80-90% odds of passage by end of April, revised his forecast on April 13 to end of May — and described himself as “less optimistic than before.” Prediction market odds have fallen from 82% to around 61%.

What’s Still Being Fought Over

Tim Scott named three issues on Fox Business on April 14. Here’s what they actually are, in plain English.

1. Stablecoin yield. A compromise text exists — ban passive yield on stablecoin balances, allow activity-based rewards tied to payments and platform use. The banks can live with it. But Coinbase and Stripe told Senate staff they can’t accept the March 23 draft as written — it landed too close to the bank position. Lummis says it’s 99% resolved. The White House says the compromise is holding. It’s not fully done.

2. DeFi provisions. Decentralised finance — the world of lending, trading and earning yield through software protocols rather than companies — is a particular concern for Senate Democrats who worry it enables money laundering. The bill tries to draw a line: if you control people’s funds, you’re regulated. If you’re just software that nobody controls, you’re not. Democrats aren’t fully satisfied with where that line is drawn. The Blockchain Association sent 21 executives to meet with 24 Senate offices specifically to argue the DeFi case — which tells you how much is still being contested.

3. Republican unity — and a side deal. The committee is 13-11 Republican. Scott can’t afford a single defection if Democrats vote as a block. Republicans are also negotiating to attach community bank deregulatory provisions to the Clarity Act in exchange for the House accepting a Senate housing package. Classic Washington horse-trading that has nothing to do with crypto but could delay or derail the vote entirely.

4. There’s also a fourth issue Scott didn’t name: Democrats want an ethics provision barring senior government officials from personally profiting from crypto assets while in office. Given that the President’s family has launched their own stablecoin — USD1 — and the Trump family’s broader crypto interests are well documented, this is pointed. It hasn’t been agreed.

There’s a rich irony here worth acknowledging. Politicians trading stocks while writing the rules that govern them has been an open scandal for years. Nancy Pelosi’s stock trades became a cultural moment — her portfolio’s uncanny ability to outperform the market while she sat on committees overseeing the very industries she was invested in raised questions that were never properly answered. The ethics problem in Washington isn’t crypto-specific. It’s a systemic one that crypto has simply made more visible. If the Clarity Act delivers an ethics provision that only covers digital assets, it will be better than nothing — but it will also be a reminder of how selectively accountability gets applied in American politics.

None of these issues are insurmountable. Scott himself said each could be resolved within two weeks. But could be and will be are different things in Washington — and the clock doesn’t care about the distinction.

Why Timing Is Everything

To understand why the 2030 warning isn’t pessimism, you need to understand how Washington’s calendar works.

The Senate has roughly six to eight weeks of usable legislative time before the summer recess. After that, midterm election campaigning dominates everything. Senators from competitive seats stop taking political risks. Complex legislation with multiple stakeholder disputes — exactly what the Clarity Act is — gets shelved.

Then November arrives. And here’s where it gets genuinely precarious. Midterm elections historically punish the incumbent party. Republicans currently control the House. If they lose it — and history suggests they might — the entire legislative picture flips. A new Democratic House majority that has been consistently hostile to crypto regulation takes the gavel. You’d have a pro-crypto White House and a Congress that doesn’t want to play ball. Nothing passes.

Even if Republicans hold the House, a new Congress means starting the Clarity Act from scratch. New committee assignments. New negotiations. New political dynamics. The bill that passed 294-134 in July 2025 doesn’t carry over — it has to be reintroduced and re-passed.

And in January 2027, Cynthia Lummis leaves the Senate. She has been the single most committed advocate for Bitcoin-specific legislation in Congress for years. The stature, the relationships, the willingness to go to the mat on technical provisions — that leaves with her.

The 2030 estimate isn’t a dramatic prediction. It’s what happens if you map the realistic political calendar: lose the House in November, new Congress in January, new negotiations, another election cycle in 2028, potentially new administration. The next window where a crypto-friendly White House, Senate majority, and House majority all align simultaneously could genuinely be that far away.

The Petrodollar Stakes

We’ve written about why Trump signed the GENIUS Act the way he did — as a strategic move to extend dollar dominance into the digital age. Dollar stablecoins as the new petrodollar. The dollar of the Internet.

The Clarity Act is the second half of that strategy. Without it, the stablecoin market has rules but no yield resolution, no clear framework for platforms, and a legal grey zone for the products trying to build on top of it. Stablecoins already have basic de minimis treatment from the GENIUS Act — but Bitcoin gets nothing. The incentive structure that makes people choose to hold dollar stablecoins over alternatives — particularly for savings rather than just transactions — never gets properly built. And the dollar of the Internet never reaches its potential.

Tether, the largest stablecoin issuer, currently earns billions annually from the spread between the yield on its Treasury holdings and the zero it pays to holders. Without yield competition from regulated US issuers, that margin stays wide — which is good for Tether’s profits in the short term. But here’s the counterargument: if regulated competitors could offer yield, adoption would explode. A smaller percentage of a vastly larger market could easily generate more dollars in real profit than a large margin on today’s volume. Tether might be protecting its margin while missing the bigger opportunity. Meanwhile, without Clarity, the regulated US players — the ones who would build the dollar’s dominance story — can’t compete properly, and the unregulated offshore player keeps winning by default.

So Where Does This Leave Us?

The Clarity Act is not dead. The odds still favour passage eventually. But “eventually” and “2026” are increasingly different things.

What makes this genuinely maddening — and the reason the diary entry framing is so apt — is that the political alignment needed to pass this bill has never existed before and may not exist again for years. The substantive arguments have been resolved. The institutional support is overwhelming. The President wants it. The regulators want it. The industry wants it. Even some banks have quietly accepted the yield compromise.

All that’s needed is Tim Scott to put a date in his calendar for a committee vote.

Senator Lummis posted three words on X the day the Senate returned from recess. The word “Clarity” was capitalised. The double meaning was not subtle.

Whether it lands before May or slips into the midterm void is now the most consequential open question in American crypto policy. And the answer depends entirely on a scheduling decision that hasn’t been made yet.

I’ll be covering this as it develops. If the markup gets scheduled this week, that’s the unlock the market has been waiting for. If it doesn’t, the clock gets louder. Make sure you’re subscribed so you get the update the moment it breaks.