DL News

OpenAI and crypto venture capital firm Paradigm on Wednesday released a tool that evaluates AI agents’ ability to identify, patch, or exploit smart contract vulnerabilities.

The tool, EVMbench, draws from 120 vulnerabilities identified over 40 prior smart contract audits, as well as “vulnerability scenarios” drawn from audits of Paradigm’s forthcoming Tempo blockchain.

The release comes days after a bug in AI-generated code cost users of crypto protocol Moonwell nearly $2.7 million in crypto.

One Moonwell software engineer said the code in question had passed an audit from crypto security firm Halborn.

So-called agents are instances of artificial intelligence that can complete complex tasks in the digital world. They can write software, purchase theatre tickets, and conduct research on behalf of their users.

EVMbench data shows that OpenAI’s latest agentic coding model, GPT-5.3-Codex, more than doubled the effectiveness of an earlier model, GPT-5, in exploiting vulnerabilities in smart contract code. But its success in finding and fixing vulnerabilities “remain below full coverage,” OpenAI said in a news release.

“Agents perform best in the exploit setting, where the objective is explicit: continue iterating until funds are drained,” the company said.

“In contrast, performance is weaker on detect and patch tasks. In ‘detect’, agents sometimes stop after identifying a single issue rather than exhaustively auditing the codebase. In ‘patch’, maintaining full functionality while removing subtle vulnerabilities remains challenging.”

A model from Anthropic, Claude Opus 4.6, scored the highest mean result in detecting software vulnerabilities. GPT-5.3-Codex achieved the highest results in patching and exploiting smart contracts.

OpenAI cautioned that EVMbench doesn’t capture the true challenge of securing smart contracts, given the limited sample of vulnerabilities used to build the tool. And it can’t reliably determine whether agent-found vulnerabilities are, in fact, false positives.

Hacks have long bedevilled the crypto industry. Non-reversible transactions make crypto protocols’ smart contracts an attractive target for cybercriminals.

As of Wednesday evening, protocols suffered more than $108 million in hacks and exploits in 2026, according to DefiLlama data.

Aleks Gilbert is DL News’ New York-based DeFi correspondent. You can reach him at aleks@dlnews.com.

Payward, the parent company of US crypto exchange Kraken, has bought token management platform Magna for an undisclosed amount.

Payward said Wednesday that the deal would help Kraken offer more than just trading infrastructure. Moving forward, the exchange would feature a “fully verticalised product suite.”

“This acquisition accelerates Kraken’s evolution into a platform where issuers, builders, and investors can rely on institutional-grade infrastructure from inception through scale,” Kraken’s head of onchain, Calvin Leyon, said.

The move comes after Kraken co-CEO Arjun Sethi told DL News in September that the crypto exchange had more deals lined up ahead of its planned IPO. Kraken made five acquisitions in 2025.

Mergers and acquisitions in the crypto space are expected to soar this year, DL News reported this month following an interview with Karl-Martin Ahrend, co-founder of crypto M&A advisory Areta.

Growing portfolio

Magna, which works to help crypto companies manage their stablecoins and other cryptocurrencies, will continue to operate as a standalone platform, Payward said.

“Joining Kraken gives us the resources to support existing and new clients with institutional-grade infrastructure, deeper liquidity, and global distribution,” Magna CEO Bruno Faviero said in a statement.

Kraken’s portfolio now includes futures trading platform NinjaTrade, which it bought for $1.5 billion, proprietary trading form Breakout, and tokenized assets platform Backed Finance.

Like its rivals, Kraken is also offering tokenised stocks and exchange-traded funds, hoping to become a platform that serves investors beyond the world of crypto.

More deals coming

Kraken said in September that while it was on the lookout for more deals, it wouldn’t have a “spray and pray” strategy but rather pick up companies that fit its roadmap.

Magna, now powered by Kraken ⤵️ https://t.co/PakpZuALjy

— Kraken (@krakenfx) February 18, 2026

Kraken is not only focused on becoming “the largest crypto platform in the world” but an “institutional-grade trading platform where any asset can be traded, anytime”, co-CEO Arjun Sethi has previously said.

And Kraken is hoping to follow in the footsteps of other top US crypto companies by going public following a $20 billion valuation. But Sethi told DL News last year that it was in no hurry to do so.

Crypto companies broke records for acquisitions last year, with $37 billion worth of deals made. And while the details of Kraken’s latest acquisition are yet to be revealed, 2026 has already gotten off to a hot start.

Mathew Di Salvo is a news correspondent with DL News. Got a tip? Email at mdisalvo@dlnews.com.

After posting a slide in profits last week, Coinbase CEO Brian Armstrong has a message for worried investors: People still don’t get the company.

Writing on X Wednesday, Armstrong said that while the Nasdaq-listed company’s stock has dropped in price by 36% over the past year, Coinbase has “never been in a stronger position.”

“I do think Coinbase is a bit of a misunderstood company,” wrote Armstrong. “Crypto is directly disrupting Wall Street, so it makes sense that some on Wall Street would misunderstand crypto/Coinbase.

“The smartest ones are going to embrace it. The laggards are going to be left behind.”

“Why is Coinbase always misunderstood or under-appreciated by Wall Street?” - I got asked this today in our AMA with analysts, and it’s an interesting question. Sharing my answer here.

I do think Coinbase is a bit of a misunderstood company. It’s a classic innovator's dilemma.…

— Brian Armstrong (@brian_armstrong) February 17, 2026

Armstrong’s defense comes just as Coinbase is caught between a rock and a hard place. Trading revenue has crashed alongside falling crypto prices, and a longer-term bet on becoming the underlying financial infrastructure for banks and institutions who “don’t understand the company.”

Plus, Wall Street analysts value companies based on their earnings, not just the potential they have or how much passion their management brings to the table. Right now, Coinbase’s numbers are bad. The company posted a quarterly loss in revenue and profits for the last three months of 2025 and its stock is down nearly 60% from the record it touched in July.

For Armstrong, however, the argument is that analysts are looking at all the wrong metrics.

Wall Street embrace

Armstrong said that Coinbase isn’t just a trading platform like some think: with regulators taking a softer approach to watchdogging the space, top US banks are now embracing crypto and increasingly working with Coinbase.

America’s biggest bank, JPMorgan Chase, last year signed a deal with Coinbase to allow customers to directly link their bank accounts to the US-based crypto exchange.

Coinbase also provides custody services to Wall Street giants like BlackRock, and has a contract with the US government to hold onto seized crypto.

Traditional financial institutions that aren’t open to crypto will get left behind, Armstrong said, just like what has happened in the past with previous technological disruptions.

“I think some of these people are just inherently skeptical of crypto because of incentives — their whole careers have been built in the traditional financial system,” he added.

“You don’t go to the cab companies and ask them what they think about Uber. You don’t go to the horse and buggy makers and ask them what they think about the automobile.”

Missing expectations?

Coinbase in its latest earnings underperformed in the eyes of Wall Street analysts. But those who don’t see the company’s potential have “underestimated” the company, claimed Armstrong.

“It’s not yet a consensus view amongst traditional analysts,” he wrote, adding that the firm was “underestimated” and that analysts should look at what other products the company is delivering.

In a note shared with DL News, Benchmark analyst Mark Palmer said that Coinbase is trading in line with crypto right now — dumping in price in October when Bitcoin sold off.

“The stock trades like levered crypto beta, moving tightly with digital asset prices, yet its underlying business is evolving into something more diversified and durable,” wrote Palmer.

He added that Coinbase’s institutional transaction revenue is up, pointing to bigger players using the company’s services.

While right now working with banks, Coinbase is also competing with them, with Armstrong in the past saying that he wants the platform to become “people’s primary financial account.”

Coinbase is currently at odds with banking executives, who want to ban stablecoin rewards.

Coinbase wants its yield-bearing stablecoin products to continue, which in turn could prove to be a bigger boon in the long-run for the business.

Mathew Di Salvo is a news correspondent with DL News. Got a tip? Email at mdisalvo@dlnews.com.

Bitcoin miners are now getting pressured by their own investors to forego their core business model and plough even further into AI. The shift could boost the stock’s price more than threefold.

On Wednesday, Starboard Value, which holds a 3.5% stake in the Bitcoin mining outfit Riot Platforms, sent a letter to Riot CEO Jason Les arguing the company is sitting on a goldmine of power capacity that could generate billions of dollars — granted it transitions to AI.

“Time is of the essence, and a renewed sense of urgency is required to get more material deals completed,” wrote Peter Feld, managing member of Starboard Value in a press release. Moreover, Riot operates “two of the most attractive sites in the country for AI/HPC data centers,” Feld said.

If Riot can monetise its remaining 1.4 gigawatts of capacity at rates similar to recent deals done by its mining peers, Starboard estimates the data center business alone could be worth $23 to $53 per share.

Shares trade right now at about $15, according to Yahoo Finance.

The pressure reflects a broad existential crisis happening in the Bitcoin mining space.

Every major US-listed miner has pivoted toward AI and high-performance computing as mining became deeply unprofitable following last year’s halving, according to Bernstein analysts.

Additionally, the Bitcoin network, which also adds into miners’ bottom line thanks to transaction fees, has become somewhat of a ghost town, with some blocks barely scratching the 100 transaction count. They can hold upwards of 3,000 transactions.

All of this has left Bitcoin miners with little choice but to repurpose their facilities into AI and HPC. It’s a transformation so profound that Wall Street analysts are now valuing these companies on their AI output rather than their Bitcoin production.

AI selloff

The letter’s timing is pretty delicate.

Scepticism about massive spending on AI infrastructure has grown among investors, forcing some miners to sell Bitcoin just to fund their data centre pivots. Those bets, however, are looking increasingly fragile, said Matthew Sigel, head of digital assets research at VanEck.

Starboard did acknowledge the challenge but it countered that Riot’s sites are particularly attractive, and should be focusing on “high-quality tenants” like hyperscalers, rather than “lower-quality, non-investment-grade tenants with whom some peers have done deals.”

Notably, the letter also suggested that if Riot can’t execute quickly enough, it could become an “exciting candidate for consolidation.”

Riot Platforms and Starboard Value did not immediately respond to a request for comment from DL News.

Pedro Solimano is a markets correspondent based in Buenos Aires. Got a tip? Email him at psolimano@dlnews.com.

Artificial intelligence will take white-collar workers’ jobs and threaten to crash the US economy, which Arthur Hayes says will pave the way for Bitcoin to reach a new record high.

In his latest missive, the Maelstrom chief investment officer argues that large language models from OpenAI and Anthropic will push office workers out of their jobs and trigger a financial downturn, as those workers fail to repay their loans.

Eventually, that will force the Federal Reserve to step in and print money to avoid deflation spiralling out of control, Hayes argues.

When that happens, Bitcoin is set to hit a new all-time high.

“Deflation is bad, but ultimately good for fiat credit-sensitive assets like Bitcoin,” Hayes wrote in his Tuesday blog.

His forecast may serve as a slight balm for investors who’ve been burned by the market downturn that has shaved 45% Bitcoin’s price since it reached its $124,000 record in October.

During that time, the overall crypto market has lost about half of its total value, or $2 trillion.

The AI crash

Hayes’ argument is simple.

Companies will replace white-collar workers with AI tools, which means those workers will be unable to pay their debts. If enough of them default on their loans, banks will suffer roughly $527 billion in losses, per Hayes’ estimates.

Those defaults risk wiping out all but the biggest banks from the market.

“This will be a rerun of the regional bank crisis in early 2023 that destroyed three banks in a fortnight,” Hayes wrote.

“But this time it will be much worse, as the genesis of the crisis is the unstoppable nature of AI, a narrative the market believes and is terrified by.”

As the crisis continues, traders will likely dump their stocks to avoid being swept up in the banking crisis, which will cause the stock market to collapse, Hayes argues.

The result of this cascading crisis is that the Federal Reserve and the US Treasury will step in to print money in order to avoid a repeat of the Panic of 2008.

“And then wham bam thank you ma’am it’s time to back up the fucking truck and buy Bitcoin and shitcoins like it’s 2020,” Hayes said.

To be sure, the BitMEX co-founder doesn’t say this will happen tomorrow or maybe not even this year, only that he believes it will happen.

Hayes’s many Bitcoin predictions

Hayes has form when it comes to making bullish Bitcoin bets.

Usually, those calls revolve around some sort of intervention from the Federal Reserve that’ll see the central bank plough more money into the economy.

In the past, he’s predicted that Bitcoin will pump thanks to the Fed printing money to bail out its Japanese counterpart, the central bank’s Reserve Management Purchases programme, falling mortgage rates, and commercial banks lending to strategic industries.

In January, he also suggested that the capture of former Venezuelan President Nicolas Maduro would give the US access to the Latin American country’s oil, which would keep inflation down and give the Fed an excuse to cut interest rates.

Low interest rates usually incentivise investors to bet on riskier assets like Bitcoin.

In December, he predicted that Bitcoin’s price would reach $200,000 by March.

To be sure, Hayes has an impressive track record for forecasting the price movement of the world’s biggest cryptocurrency, but he’s been proven wrong in the past.

At the beginning of 2025, he — like Tom Lee and analysts at Bernstein, Bitwise and Standard Chartered — predicted that Bitcoin would end the year trading at $200,000.

Hayes later lowered his target to $150,000. Bitcoin ended the year trading just over $87,500.

Eric Johansson is DL News managing editor. Got a tip? Email him at eric@dlnews.com.

The once-soaring stablecoin market is stuck in a rut, but more economic uses and a stronger US dollar promise to reignite growth, analysts say.

Last year, stablecoins added a whopping $103 billion to their total supply, bringing the total to over $300 billion in October.

Yet the same month, the crypto market was struck by its worst-ever leverage wipeout.

Since then, investor appetite for dollar-pegged assets has waned.

Adam Morgan McCarthy, a senior research analyst at Kaiko, sees two key drivers behind the stall: lower trading activity and waning US dollar power.

Stablecoins are a key liquidity vehicle for crypto trading, and with trading volumes down from their October highs, there’s naturally less demand for them as a result, he told DL News.

Additionally, the dollar’s strength relative to other currencies has declined by 9% over the past year.

So holding money in US dollar-denominated stablecoins is less attractive, even with yields around 4%, McCarthy said.

Stablecoins stall

US dollar stablecoins, crypto tokens backed by the US dollar, were supposed to revolutionise how the world moves money by speeding up transfers, lowering costs, and enhancing transparency.

US Treasury Secretary Scott Bessent forecast in November that US dollar stablecoins would swell to $3 trillion by 2030, while Citibank predicted issuance could hit $4 trillion by the same year.

But the technology hasn’t yet achieved the mainstream adoption many hoped it would after the passing of the Genius Act, a key US stablecoin law, in July.

That’s not for a lack of trying.

Dozens of the biggest financial firms are experimenting with stablecoins and incorporating them into their services.

In November, payments giant Visa launched a pilot stablecoin payment scheme for US gig economy workers. Last month, the New York Stock Exchange announced it would launch a tokenised securities trading platform that uses stablecoins for funding.

Wall Street titans BlackRock and JPMorgan have also launched their own stablecoins for institutional investors.

Yet despite those efforts, demand for dollar-pegged assets remains tied to the crypto market’s fluctuations.

Fear factor

With crypto trading as the primary driver of stablecoin demand, a short-term recovery could be difficult.

“The market’s main driver right now is fear. Fear that we’ll go lower,” Danny Nelson, a research analyst at Bitwise Asset Management, told DL News. “In a market like this, good news doesn’t register with investors. If they see an exit ramp, they’re taking it.”

As for the US dollar’s strength, that doesn’t look good either.

The US Dollar Index, a benchmark that measures the dollar’s value against a basket of foreign currencies, has fallen some 11% over the past year.

“The Trump administration had been pretty explicit in the past about making the dollar weaker to support exports,” McCarthy said, adding that he doesn’t see many opportunities for either factor to change in the near term.

Tokenisation push

On a longer time horizon, the drivers that pushed the stablecoin market to $300 billion are still intact, analysts say.

“What reverses this is renewed activity within the ecosystem or economic use,” Fabian Dori, chief investment officer at Sygnum Bank, told DL News. “The next phase of growth will be driven by stablecoins becoming embedded in financial infrastructure.”

One way that’s already happening is through tokenisation, the process of converting ownership rights in assets like real estate, stocks, or bonds into digital tokens on a blockchain.

Proponents, including BlackRock CEO Larry Fink, argue that doing so will accelerate finance, reduce costs, and provide greater accountability.

“We would be reducing fees, we would do more democratisation,” Fink said while speaking on a World Economic Forum panel in Davos, Switzerland, last month. “[If] we have one common blockchain, we could reduce corruption.”

As tokenisation gains traction and institutions issue stablecoins designed for settlement, collateral, and payments, Dori said, demand becomes tied to real financial activity rather than trading.

Dori isn’t the only one looking to the promise of tokenisation to save the stablecoin market.

“Tokenisation is accelerating regardless of the volatility,” Bitwise’s Nelson said. “Companies like BlackRock aren’t getting phased by fear.”

Crypto market movers

Bitcoin is down 0.6% over the past 24 hours, trading at $67,435.

Ethereum is up 0.7% past 24 hours at $1,984.

What we’re reading

Japan’s top securities firms prepare crypto exchange pivot — DL News

ZeroLend Shuts Down After Liquidity Dries Up Across Layer 2s — Unchained

How Ethereum devs will use AI to boost blockchain’s development — DL News

Inside the Crypto Collapse: Binance Selling, ETF Exhaustion & OG Profit Taking w/ Delphi Digital — Milk Road

What to expect at Trumps’ World Liberty Forum despite $2tn market meltdown and Democrat probes — DL News

Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.

After a few short months, Peter Thiel appears to be dropping his Ethereum bet.

The billionaire tech founder and investor exited his position in one of the largest Ethereum corporate treasuries, filings on Tuesday show.

ETHZilla, formerly a biotech company called 180 Life Sciences, closed a $425 million private placement in August to pivot to a very different model.

Instead of developing pharmaceuticals, the company began buying Ether tokens en masse, becoming one of the largest publicly traded corporate Ethereum treasury firms.

Now, it looks to have lost the backing of one of its most influential investors.

Filings with the Securities and Exchange Commission show that Thiel and his investment vehicles, including Founders Fund, sold their entire 7.5% stake at the end of 2025.

Stock in ETHZilla, which trades under the ticker ETHZ, dropped more than 8% on Tuesday. It has since recouped some of those losses and trades at $3.5 on the Nasdaq.

ETHZilla and Founders Fund did not immediately respond to comment.

Tokenised jet engines

Crypto corporate treasury companies, of which Michael Saylor’s Strategy laid the groundwork, have fallen on hard times.

Between 2024 and early 2025, dozens of publicly traded companies quickly pivoted to raising billions of dollars to buy cryptocurrencies, such as Bitcoin and Ethereum.

As of December, however, only one company had outperformed the S&P 500.

When ETHZilla announced its $425 million raise in August, the company’s stock hit a record high of $174. Today, ETHZ has cratered more than 97%, according to the Nasdaq.

To be sure, the Ethereum treasury company hasn’t given up yet.

On February 5, it announced it would advance on its tokenisation ambitions after acquiring a portfolio of home loans. The company plans to turn these loans into tokens on an undisclosed layer 2 network as early as the end of the month.

Equally, on February 12, ETHZilla moved to tokenise two commercial jet engines acquired by the company for $12.2 million.

Liam Kelly is DL News’ Berlin-based DeFi correspondent. Have a tip? Get in touch at liam@dlnews.com.

In a court filing and a short video posted on social media on Tuesday, Commodity Futures Trading Commission Chair Mike Selig waded into the raging battle over prediction markets’ ability to offer sports betting across the US.

Prediction markets have been “hit with an onslaught of state-led litigation,” Selig said in the video shared on X. As such, he continued, the regulator has submitted a so-called amicus brief in a lawsuit filed last year by crypto exchange Crypto.com.

When the Nevada Gaming Control Board ordered Crypto.com to pull its prediction market product from the state, the company sued. But a federal judge denied its request for a preliminary injunction. Crypto.com has stopped offering sports event contracts in Nevada while it appeals the judge’s order.

A copy of the CFTC’s brief wasn’t immediately available online. But Selig said the agency had filed the brief in order to “defend its exclusive jurisdiction over these derivative markets.”

The filing comes just four days after a group of 23 Senators, all Democrats, asked Selig to “abstain from intervening in pending litigation involving contracts tied to sports, war, or other prohibited events.”

“Prediction market platforms are offering contracts that mirror sportsbook wagers and, in some cases, contracts tied to war and armed conflict,” they wrote in a February 13 letter.

“These products evade state and tribal consumer protections, generate no public revenue, and undermine sovereign regulatory regimes.”

LeBron James rebounds

Their concern isn’t stricly partisan.

“Mike, I appreciate you attempting this with a straight face, but I don’t remember the CFTC having authority over the ‘derivative market’ of LeBron James rebounds,” Utah Governor Spencer Cox, a Republican, said on X.

“These prediction markets you are breathlessly defending are gambling — pure and simple. They are destroying the lives of families and countless Americans, especially young men. They have no place in Utah.”

While prediction markets such as Kalshi and Polymarket began by offering bets on economic indicators and world events, they eventually branched into sports betting. But they’ve found themselves in a multi-front legal battle against states that require sports gambling platforms to seek licensure.

The companies have argued that the CFTC has the sole authority to regulate financial derivatives, a category that, they say, includes sports-themed “event contracts.” But states officials have argued those products are no different from traditional sports gambling, which has long been regulated by state gaming authorities.

Selig, a crypto-industry ally nominated last year by President Donald Trump to lead the CFTC, dodged questions about his position on the matter during his confirmation hearing in November.

Selig repeatedly referenced prediction markets’ ongoing legal battles and said he would defer to the courts.

Turf wars

Selig hasn’t exactly broken that promise — an amicus brief is just an opinion offered for a court’s consideration.

Nevertheless, its opinion carries great weight, according to Andrew Verstein, the co-director of the business law program at the University of California, Los Angeles.

“In general, the CFTC has a very powerful position, which is that it has a terrifically wide congressional authorization to be the sole regulator of products that it wants to regulate,” he told DL News.

“And this has led to a lot of turf wars in the past, boundaries between states and the CFTC on gambling laws, boundary disputes with the SEC about different derivatives, what’s in, what’s out.”

Selig echoed that sentiment in an X thread accompanying his video.

“Congress gave the CFTC comprehensive authority over any contract based on a commodity, and the legal definition of a commodity is very broad,” he wrote.

And in a Wall Street Journal essay published Tuesday, he said the agency would “no longer sit idly by while overzealous state governments undermine the agency’s exclusive jurisdiction over these markets by seeking to establish statewide prohibitions on these exciting products.”

Crypto executives hailed the news.

“This is the kind of leadership and courage that will make America the crypto and markets capital of the world,” Tyler Winklevoss, co-founder of crypto exchange Gemini, wrote.

Robinhood and Coinbase both offer a prediction market product in partnership with Kalshi. Trump Media, the conglomerate majority-owned by Trump, partnered with Crypto.com to build its own forthcoming prediction market platform, Truth Predict.

Aleks Gilbert is DL News’ New York based DeFi correspondent. You can reach him at aleks@dlnews.com.

GM, Tim here.

One of the most influential voices in the Ethereum development community wants the $238 billion blockchain to lean hard into artificial intelligence.

Tomasz Stańczak, co-director of the Ethereum Foundation, argues that the large language models that power AI can deliver big efficiency gains by writing, reviewing and editing proposals, moderating meetings, writing code, and even accepting or rejecting network upgrades.

“It is important for Ethereum to be the first chain to be LLM-driven,” Stańczak said on Sunday. “It is an advantage akin to being the first PoW chain.”

PoW, or Proof-of-Work, refers to a consensus mechanism blockchains like Bitcoin use to validate the network.

Ethereum has a big head start, Stańczak said. Much of the blockchain’s development, in the form of written proposals, developer calls, and other technical documentation, is published online. An AI could easily be trained on this trove of information, giving it deep insight into the entire history of Ethereum’s development.

It’s a bold idea, and likely one of Stańczak’s last initiatives before he leaves the Ethereum Foundation at the end of the month.

Software developers outside of the crypto industry increasingly rely on AI.

Last week, Spotify co-CEO Gustav Söderström said in his firm’s fourth-quarter earnings call that the firm’s top developers “have not written a single line of code” in 2026, instead using AI exclusively to design software.

Stańczak’s ideas go beyond using AI to just generate code.

He wants to bring in AI agents, autonomous software programmes designed to achieve specific goals without constant human oversight.

The agents could participate in the submission and editing of Ethereum Improvement Proposals, moderate developer calls in real-time and provide suggestions to participants, and eventually distill and broadcast the entire Ethereum governance process.

Outside of crypto, businesses are pouring resources into developing AI agents, with tech giants Google and Microsoft leading the charge.

The market for AI agents is estimated to surpass $50 billion within the next five years, according to Boston Consulting Group.

It all sounds very futuristic, akin to video game AI companions like Cortana in the Halo franchise.

But the buzzy technology is not without drawbacks.

AI models are prone to hallucinating — a term used for when AI produces false or made up information that it tries to pass off as real.

In April, research conducted by OpenAI found that its two latest and most powerful reasoning models hallucinated 33% and 48% of the time.

These hallucinations can be disastrous for AI agents. Those who have tried getting them to engage in dynamic, fast-paced activities like crypto trading have found they often make simple mistakes.

Ethereum watchers may need to wait a while before they start seeing AI make its way into the blockchain’s development.

Stańczak said he expects the shift to take at least two years.

“We should have the relevant tooling and integrations finished by Q3 (the earlier the better),” he said.

Top DeFi stories of the week

This week in DeFi governance

VOTE: ZKsync Token Assembly to fund bug bounty programme on Immunefi

VOTE: Compound DAO to approve new Ecosystem Protection and Continuity Fund

VOTE: Fluid to use treasury funds to cover user losses caused by ETH borrow rate spikes

Post of the week

Sam Bankman-Fried is trying to convince Crypto X that FTX was never insolvent, despite serving a 25-year prison sentence for defrauding his customers.

It’s not going well.

funny how he revised anthropic up without revising the coins down

you can tell he hasn’t lost his panache for creative accounting https://t.co/e3FnvGJgE8

— krane (@0xkrane) February 13, 2026

Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.

Three Japanese securities giants with a combined market cap of around $48 billion say they are considering launching crypto exchange businesses, with the largest of the trio aiming to provide crypto-trading services by the end of 2026.

Nomura Holdings, Japan’s biggest securities provider, which manages around $673 billion in clients’ assets, says it will launch its operations via its Swiss crypto subsidiary Laser Digital, Japanese newspaper Nihon Keizai Shimbun reported.

The other two firms named were Daiwa Securities Group and SMBC Nikko Securities, which Nihon Keizai Shimbun said are strongly considering entry into the crypto exchange market.

The firms say they’re acting in anticipation of crypto investment demand skyrocketing when Tokyo lifts restrictions on crypto exchange-traded funds, the newspaper reported.

Japanese firms are refusing to let slumping Bitcoin prices derail their crypto adoption plans, with scores of digital asset treasuries set to bolster their crypto holdings in 2026.

Deregulation hopes

The securities firms will have to navigate strict permit acquisition rules surrounding exchanges in Japan if their plans are to bear fruit. Thus far, only a handful of tech startups have managed to obtain these permits.

Two other securities giants, SBI Holdings and Monex Group, have already used the merger and acquisitions markets to buy up smaller crypto exchanges and rebrand them as SBI and Monex subsidiaries.

However, the newspaper reported Nomura’s primary focus is the Japanese market, which means it too may have to either apply for an operating permit or consider a takeover bid for a permit-holding exchange.

Nomura will reportedly seek a Japanese business license for Laser Digital in the months ahead, while SMBC Nikko has launched a decentralised finance department as it explores its options.

The firms will primarily target corporate clients, the newspaper reported.

DL News has approached all three firms for comment on the report.

Japanese regulators’ attempts to deregulate the tightly policed Japanese crypto market are sending encouraging signals to traditional finance providers, domestic media outlets report.

The Financial Services Agency’s proposed amendments to the Financial Instruments and Exchange Act are accelerating the full-scale entry of traditional financial institutions into the cryptocurrency market, Japanese media outlet CryptoTimes wrote on X.

The regulator wants to reclassify Bitcoin and several high-cap coins as investment products. Currently, Japanese law recognises them as payment instruments.

Late last month, Nomura said its “commitment to digital asset-related businesses remains unchanged,” despite “reducing its positions in cryptocurrencies” after Laser Digital suffered unspecified losses in the third quarter.

And in November, Nomura, Daiwa, and four other financial firms said they were keen to launch crypto funds for domestic investors.

Tim Alper is a News Correspondent at DL News. Got a tip? Email him at tdalper@dlnews.com.

Trading platform eToro reported better than expected quarterly results on Tuesday, with the company posting profit as crypto traders swung to buying and selling commodities during a brutal market downturn.

Revenue from crypto trading fell by 38% to $3.6 billion in the last three months of 2025 compared to 2024. For the full year, eToro’s cryptoasset revenue rose by almost 7% to $12.9 billion — a whopping 94% of its total revenue and income.

CEO Yoni Assia said the firm was still “extremely bullish” on crypto.

“We’re seeing something that we haven’t seen before, which is crypto native customers — people came into eToro to trade crypto, and traded mostly crypto, suddenly trading a commodity,” he said.

The fintech firm reported its earnings amidst a market downturn that has shaved almost half, or $2 trillion, off the cryptocurrency market’s total value. The report also highlights how important crypto has become for tech startups that have up until recently provided more traditional financial products.

Earlier in February, rival Robinhood similarly reported a 27% revenue increase for the full year, fuelled by its bet on crypto assets.

Switch to metals

eToro reported a 43% surge in net income from equities, commodities and currencies year-over-year but a drop in revenue from crypto trading.

The company’s net income for the full year grew 12% to $216 million in 2025. Shares of eToro were trading nearly 14% higher at 10.30am in New York.

While eToro acknowledged that it took a hit when crypto trading volumes fell, the firm has been able to pivot to commodities.

“When we see less interest in crypto, we shift the focus from a marketing perspective to basically equities to commodities, which we’re seeing very high engagement levels on and we keep on building constantly new products in crypto,” said Assia.

Cryptocurrencies are down, but gold, silver, and stocks continue to surge.

Still bullish

Despite the crypto downturn, eToro said it was committed to building products for the asset class as it expects new customers to flock to the space.

The company debuted a non-custodial crypto wallet in December and is planning new products.

“We’ve actually developed a very significant crypto road map with our non-custodial wallets, with new products coming into crypto, and we have no doubt that we’ll see more and more engagement, especially by the way, of younger crypto native generations into crypto, despite the price of Bitcoin right now,” added Assia.

Mathew Di Salvo is a news correspondent with DL News. Got a tip? Email at mdisalvo@dlnews.com.

Donald Trump’s family is about to put on a show for the crypto industry.

While the US president is busy steamrolling into his second year in office with a slew of new policies, his family’s crypto venture is drawing a star-studded crowd to an event at Mar-a-Lago, his Florida resort, on February 18.

The lineup of speakers includes the CEOs of Coinbase, BitGo, Franklin Templeton and Goldman Sachs, as well as the president of FIFA, rapper Nicki Minaj, celebrity investor Kevin O’Leary, and a slew of elected officials and regulators.

They’ll be joined by a “select group of 300 global leaders,” according to World Liberty Financial.

The goal?

To define “what the next century of American innovation, leadership, and economic influence will look like,” according to Donald Trump Jr., the president’s firstborn and co-founder of the crypto company.

The World Liberty Forum is the Trump family’s latest crypto initiative.

Over the past year, the company has announced plans to launch a foreign exchange and remittance platform, created a digital asset treasury, and applied for a US federal banking license.

The event’s timing is notable.

It comes as the president’s political rivals are ramping up the pressure on the White House regarding his family’s crypto deals.

At the same time, the 79-year-old is seemingly losing support among crypto industry insiders who are disappointed with the results of his first year in office.

What’s World Liberty Financial?

World Liberty Financial was founded in 2024. It is at the centre of the Trump family’s crypto empire. The company positions itself as a decentralised finance platform and stablecoin issuer, serving as a bridge between traditional finance and crypto.

Co-founders include presidential sons Eric Trump, Donald Trump Jr., Barron Trump, as well as Zach and Alex Witkoff, sons of the president’s foreign policy advisor Steve Witkoff.

Steve Witkoff and Donald Trump are both co-founders emeritus, according to the company‘s website.

The venture issues USD1, a dollar-pegged stablecoin backed by US Treasuries and cash equivalents.

Since its launch, the USD1 stablecoin has become the fifth-largest stablecoin by circulation, with $5 billion in circulation, according to DefiLlama data.

Yet, the project has also drawn ire from investors.

Fans who poured $550 million into buying the WLFI token, issued by World Liberty Financial, have been left disappointed after realising they’re unable to sell the tokens.

And while they’ve been unable to offload the tokens, they’ve seen the price tumble 69% below its peak.

World Liberty Financial has released 20% of the tokens so far and has promised a vote among holders on when the rest will be made available. That vote hasn’t materialised yet.

Political attacks

The Trump family’s crypto dealings have also opened up attack lines for his political opponents.

Over the past year, Democrats have raised concerns about Donald Trump’s crypto dealings.

On Friday, US Democratic Party Senators Elizabeth Warren and Andy Kim fired off the latest salvo in their campaign by issuing a formal letter to Scott Bessent, the US Secretary of the Treasury.

In it, they called for a probe into World Liberty Financial on national security grounds over a reported $500 million equity stake in the firm linked to the United Arab Emirates.

They cited a Wall Street Journal report that say the deal was signed four days before Donald Trump’s inauguration and saw the UAE firm buy a 49% stake in World Liberty Financial.

The letter sets a March deadline to respond.

It follows from a November attack when Democrats on the Judiciary Committee accused the president of corruption, saying that his family’s crypto ventures “leveraged his office to make himself a crypto billionaire.”

In November, a 60 Minutes investigation linked a $2 billion investment deal between Binance and Abu Dhabi’s MGX to Trump’s presidential pardon for the exchange’s co-founder Changpeng Zhao.

Critics link the deal, which was conducted with USD1, to the pardon.

In December, Binance launched a programme to promote the use of USD1. It offered up to 20% yield on USD1 holdings of up to $50,000.

Binance custodies an overwhelming 92% of the USD1 supply, according to blockchain intelligence platform Arkham.

Zhao denied allegations of wrongdoing in a recent podcast.

“I didn’t do much,” Zhao replied to questions about what he did to get the pardon. “I didn’t do anything.”

The White House has also consistently dismissed accusations of wrongdoing.

“The President has no involvement in business deals that would implicate his constitutional responsibilities,” White House counsel David Warrington told DL News.

When asked, White House principal deputy press secretary Anna Kelly repeated to DL News that “President Trump’s assets are in a trust managed by his children. There are no conflicts of interest.”

‘Bad for the industry’

World Liberty Financial is far from the Trump family’s only crypto-related project.

Trump-linked projects include everything from non-fungible tokens to Bitcoin treasury plays, with mixed results. The president’s official memecoin and the one associated with First Lady Melania Trump are down 95% and 99% since their all-time highs.

Pundits have criticised the Trump-linked memecoins.

“This obviously gives a clear green light that any crime and attention-grabbing schema is now legal,” Ivan, a pseudonymous co-founder of GearBox Protocol and admin of DeFi research group Lobster DAO, told DL News in January 2025, days after the memecoins were launched.

At the time, businessman Anthony Scaramucci, who served as Trump’s own White House communications director in 2017, was equally doubtful, branding them as “as bad for the industry.”

In the year since, rumblings among the crypto community have grown louder.

‘Upbeat’ for Mar-a-lago

Donald Trump came out in support of the crypto industry during his 2024 campaign. He promised to make the US the crypto capital of the world. In return, the industry drove $18 million into his inauguration in January 2025.

In office, the president has repaid the support by issuing pro-industry executive orders, pardoning influential industry players, backing light-touch regulations, and signing a landmark stablecoin bill into law.

Those initiatives helped drive Bitcoin to a record high of over $126,000 in October, with the rest of the crypto market surging in tandem.

However, uncertainties caused by the president’s foreign policies — including threats to punish trading partners with sky-high tariffs and attempts to take Greenland — have weighed on markets.

Since October, the crypto market has lost about $2 trillion, or half, of its total value.

The fact that the wipeout occurred while other assets — such as tech stocks and gold — surged has rattled crypto traders, who have cashed out in droves, thus draining liquidity from the sector.

That, combined with more crypto-friendly legislation having stalled, has seen some members of the cryptorati turn against the president.

“At the end, he was bad for crypto. Big mistake to have him as president,” crypto influencer Carl Runefelt tweeted.

Whether this backlash will carry over into the midterms this year remains to be seen.

To be sure, other crypto influencers expressed outrage when a top Democratic account appeared to mock the Bitcoin crash earlier in February, Axios reports.

It is against this backdrop that the World Liberty Forum will go ahead.

And, despite the controversies, members of the crypto community seem excited about the event.

“The industry is very upbeat about the potential of such a gathering,” Pranav Agarwal, portfolio advisor and investor at Ajna Capital, told DL News.

The event “signals the coming together of blockchain-based solutions, especially decentralised finance and stablecoins with traditional policy makers and financial powerhouses,” Agarwal said.

Lance Datskoluo is DL News’ Europe-based markets correspondent. Eric Johansson is DL News’ managing editor. Got a tip? Email them at lance@dlnews.com and eric@dlnews.com.

Russia’s northwestern Komi Republic wants to reinvent itself as the country’s top Bitcoin mining hotspot by the end of 2026 — but some aren’t prepared to wait that long.

Police have arrested a man who allegedly stole $80,000 worth of power from the region’s grid to power his rigs.

The man, a 39-year-old farm owner, used a series of illegal connections to link his devices to the republic’s power grid in an outbuilding on his property, the Russian Ministry of Internal Affairs’ Komi Republic branch wrote.

In 2024, Komi Republic officials announced plans to build 15 crypto mining data centres. Construction has already begun on two of these, which are set to cost a combined total of over $28 million.

One of the centres is being built in a major industrial park and will have a capacity of 114 MW, Russian media outlet CNews reported in November. Officials say the first of the mining centres will go online by the end of the year.

Komi’s move could see the Russian Bitcoin mining industry shift away from Southern Siberia, its long-standing heartland, and further north, to parts of the country with richer energy resources and underdeveloped industrial sectors.

Illegal connections

Investigators have accused the miner of operating more than 80 ASIC crypto-mining rigs housed in a warehouse designed to store logging equipment and combine harvesters.

He used a complex connection system to bypass his property’s meters, running a power cable directly from a transformer substation, police say.

The man also failed to register his activities with the Federal Tax Service, investigators say. Under Russian law, private citizens may use only 6,000 kWh per month.

This amount, Russian media outlet RBC reported, is only enough to provide power for two or three of the most modern ASIC rigs.

The ministry said it had worked with the Federal Security Service, or FSB, to help identify and arrest the man. Officers raided the property and discovered that the rigs had been operating since August. Bailiffs have confiscated the mining rigs.

The man will face charges of breach of trust and property damage.

However, if lawmakers get their way, illegal miners will soon face stricter punishments, including possible jail time and hefty fines.

The measures will be bundled with the country’s next batch of crypto laws, which are slated for debate in the State Duma’s upcoming spring session.

Tim Alper is a News Correspondent at DL News. Got a tip? Email him at tdalper@dlnews.com.

A version of this story appeared in The Guidance newsletter on February 16. Sign up here.

Crypto transactions tied to alleged human trafficking surged by 85% in 2025, according to a February report by crypto compliance firm Chainalysis.

The firm identified hundreds of millions of dollars in volumes linked to illicit escort services, prostitution networks, and child sexual abuse material vendors.

“The dollar amounts significantly understate the human toll of these crimes, where the true cost is measured in lives impacted rather than money transferred,” the report read.

Chainalysis added that much of the latest growth lies in Southeast Asia’s booming scam economy.

The firm unveiled the critical role that so-called labour placement agents play in these schemes. Labour placement agents are individuals who were offered a fake job before being forced into scam compounds.

These compounds are often monolithic buildings complete with food halls, dorms, and even gyms. They host labour agents who conduct a range of cyber scams.

Estimates suggest that fraudulent activity and scams — ranging from pig butchering to illicit gambling — now make up an enormous chunk of the region’s gross domestic product, or GDP.

More than 30% of Cambodia’s GDP was generated by cyberscam revenue, according to the 2023 annual estimates. Cambodia isn‘t alone either. Countries in East and Southeast Asia have lost an estimated $37 billion to cybercrime, according to an April 2025 report from the United Nations Office on Drugs and Crime.

And with it, very legitimate political concerns for the countries within the scam empire.

When the conflict between Thailand and Cambodia erupted late last year, it appeared to be another example of simmering geopolitical tensions coming to a head.

That was largely true.

Ambiguities over the countries’ shared border, the two nations‘ growing nationalist tendencies, and territorial claims to oil and gas reserves in the region have stoked tensions.

But as crypto intelligence firm Inca Digital pointed out, another key element played a role.

Conflict erupted again shortly after Thai authorities seized over $300 million in December, including cryptocurrencies, from Cambodian elites tied to large scam networks.

Indeed, the seizure has become a defining chapter of the current conflict.

“The Thai-Cambodia border is emerging as the first military flashpoint shaped in real time by the political economy of crypto-fraud, where pressure on illicit revenue streams produces

measurable shifts in state behaviour, including escalation incentives,” Inca Digital wrote in December.

While authorities in many countries are working to crack down on illicit activity, the results have been mixed.

“Every time we think we have found the scam compound we are looking for, emerging out of the darkness is a scam compound that is even bigger than we thought,” Erin West, founder of Operation Shamrock, said on Monday.

“There is no end to the construction in Cambodia right now.”

Liam Kelly is DL News’ Berlin-based DeFi correspondent. Have a tip? Get in touch at liam@dlnews.com.

Crypto traders are set to push the price of Bitcoin back to $100,000, according to Shawn Young, chief analyst at MEXC Research.

His argument? Yes, buyers aren’t scooping up digital assets at the same volumes they did a few months ago, but they’re still buying more Bitcoin than what’s mined each day.

“This creates a net-positive supply dynamic that could trigger a rebound in the near term,” Young told DL News.

His optimism offers a counterweight to the pessimism that’s swept across crypto markets since October. In that time, cryptocurrencies have lost $2 trillion, about half, of their total value. Bitcoin has lost 46% of its value and has traded around $68,000 for most of February.

It will get worse, some analysts warn. Bloomberg Intelligence analyst Mike McGlone even sees the price of Bitcoin shaving 85% of its value and ending up trading as low as $10,000.

His argument is that surging stocks have zapped the market of volatility at the same time as gold and silver have outperformed Bitcoin as a safe haven asset. That, combined with the industry seemingly losing faith in US President Donald Trump’s crypto boosterism, will drive the price lower, McGlone argued.

Others, like Ben Harvey, researcher at crypto investment firm Keyrock, say Bitcoin’s next move up or down won’t be determined by crypto, but by macroeconomic factors such as the Federal Reserve cutting interest rates and institutional investors buying into Bitcoin exchange-traded funds.

Big tech bubble?

Bitcoin’s downturn and that of most cryptocurrencies come amid a broader selloff of technology stocks.

Fears of an artificial intelligence spending bubble have triggered a surge in the trading of credit default swaps, according to Bloomberg data. Credit default swaps are a type of sophisticated financial contract. They were barely traded a year ago.

These contracts act like insurance, paying out if a company cannot repay its debt. Almost $900 million of Alphabet’s debt and nearly $700 million of Meta’s debt are now tied to these contracts.

This means that hedge funds increasingly use these derivatives to protect themselves in downside scenarios. In other words, investors are hedging against a major market selloff that could also drag down Bitcoin’s price.

Dubbed the “AI scare trade,” tech stocks have been hammered since January. BlackRock’s flagship tech ETF, which tracks industry leaders like Microsoft, Oracle, and Palantir, is down just over 23% year-to-date.

Analysts expect the largest tech firms to borrow up to $400 billion this year, up from $165 billion in 2025. They will use the capital to invest heavily in AI data centres that could cost trillions of dollars overall. That increases investors’ risks if AI projects don’t pay off.

Bitcoin trades like a technology stock and thus “bears the brunt of liquidity or capital shifts,” Young said.

Crypto market movers

Bitcoin is down 1.3% over the past 24 hours, trading at $68,034.

Ethereum is down 0.7% past 24 hours at $1,973.

What we’re reading

Macro to dictate Bitcoin’s next $10,000 move as traders watch for price breakout — DL News

Standard Chartered slashes XRP price target by 65%, expects ‘further declines’ for crypto market — DL News

X to Roll Out “Smart Cashtags” With Real Time Crypto and Stock Data — Unchained

Stop Watching Bitcoin: The 3 Biggest Opportunities in Crypto Right Now w/ Jeff Dorman — Milk Road

Bitcoin price will fall to $10,000 as crypto ‘bubble is imploding,’ warns Bloomberg analyst — DL News

Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? Email him at lance@dlnews.com.

Traders are waiting on macroeconomic factors to signal Bitcoin’s next price move as the crypto market consolidates following its biggest fall in almost four years.

Over the past month, Bitcoin slid some 28%, revisiting the levels it traded at before President Donald Trump’s 2024 election win. Since then, the top cryptocurrency has ping-ponged between $74,400 to $65,000 as investors wait for the dust to settle.

Ben Harvey, a researcher at crypto investment firm Keyrock, told DL News he expects the next big Bitcoin move to be driven by factors outside of the crypto market.

“Firstly macro data that shifts the rates path,” Harvey said. “Secondly, there’s changes in Treasury financing expectations, and the final catalyst would be an inflection in institutional demand, visible through spot ETF flows.”

Financial markets traders typically look to interest rate forecasts when managing their risk.

Rate cuts, which often come in response to poor economic data, are usually viewed as bullish for risk assets like cryptocurrencies as they make borrowing less expensive and inject more liquidity into the financial system.

Yet, it’s unlikely that the Federal Reserve will cut rates before its June meeting, according to the CME FedWatch tool.

No narrative

The reason macroeconomic data is seen to be so important is because the crypto market currently lacks a narrative.

Last year, Trump’s crypto-friendly policies coupled with the passing of key stablecoin legislation helped buoy Bitcoin to an all-time high of over $126,000 in October.

But with further efforts to legislate digital assets stalling, and commodities like gold and silver dominating the so-called debasement trade, investors have been left questioning Bitcoin’s role in the broader economic landscape.

The result? Droves of traders have abandoned the crypto market, resulting in low liquidity and muted price movements.

“The market is catching its breath after some significant downside liquidity and targets were tagged last month,” Nathan Batchelor, managing partner at crypto trading data platform Biyond, told DL News.

According to Batchelor, tax season and a cyclical moving of funds back into the traditional financial system, have weighed on Bitcoin in recent weeks.

“A sustained range breakout from the $74,400 to $65,000 range could set about the next $10,000 directional move,” Batchelor said.

Room for optimism?

Some are optimistic that Bitcoin can break out of that range to the upside.

“Inflation remains moderate, GDP growth looks healthy and I see Fed rate cuts being moved up to June, which should support risk sentiment,” David Duong, global head of investment research at Coinbase, told DL News.

Duong said his market analysis shows $82,000 as a key level of resistance for Bitcoin which it will need to reclaim in order to move higher.

The low liquidity in the crypto market works both ways. If capital flows back in, Bitcoin’s price plunge could turn around quickly.

“We saw positive netflows this week, so that’s an immediate catalyst to watch,” Keyrock’s Harvey said. “Separately, a large options expiry or a sharp rebuild in futures leverage can quickly turn a range into a trend.”

Finally, there’s the Clarity Act, a broad crypto market structure bill that has stalled while passing through the US Senate.

If lawmakers move the bill forward, it could help shore up the battered crypto market, US Treasury Secretary Scott Bessent said in a Thursday interview on CNBC.

Still, a crypto market recovery this soon after such a large price plummet would be unusual by historical standards.

“Given the substantial technical damage done last month, remaining sceptical about upside moves is favourable,” Batchelor said.

Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.

Russian security forces have arrested a man they accuse of having used crypto to raise funds for armed terrorist groups.

The suspect, from Kaspiysk in Dagestan, allegedly collected about $6,500 worth of unnamed crypto over a year while living in Turkey, according to Russia’s Federal Security Service, the FSB. State news agency TASS first reported the arrest.

The FSB said it’s charged the man with providing assistance to terrorist organisations and that the investigation remains ongoing.

“While he was living in Turkey between October 2022 and October 2023, the suspect created a group on a social media platform,” the FSB said. “He posted his crypto wallet details in this group and asked followers to send donations.”

The agency did not specify which terror campaign the man is accused of financing.

Crypto adoption is on the rise in Russia, where officials say citizens spend almost $650 million per day on unregistered crypto trading platforms.

Moscow says it uses a proprietary crypto monitoring platform called Transparent Blockchain, developed by its anti-money laundering agency, to hunt crypto-powered crime and terrorism.

Agency’s probe

FSB officials said the man sent the crypto he raised to members of illegal armed groups. These members allegedly used $6,500 in crypto to buy weapons, ammunition, and other equipment.

The officials did not reveal the identity or the political alignment of the terrorist groups.

The FSB says it has remanded the man, whose name was withheld for legal reasons, in custody.

The agency has stepped up its scrutiny of crypto fundraising since 2023, when Transparent Blockchain was launched. The FSB has made multiple arrests on treason charges against individuals who donate crypto to the Ukrainian armed forces or pro-Kyiv Russian militants fighting in what the Kremlin calls the “special military operation in Ukraine.”

The FSB said last year that it arrested a total of around 300 people in the North Caucasus region, of which Dagestan is a part, on terrorism-related charges.

Some of the arrestees were charged with attempts to join foreign terrorist groups and “Ukrainian nationalist units.”

Last month, the Financial Action Task Force, or FATF, reported a rise in influencers who use social media campaigns to raise crypto for radical terror groups.

The FATF said investigators are using a range of blockchain analytical protocols to help them freeze terrorism-linked crypto wallets.

Investigators say they had evidence that Islamic State affiliates in Afghanistan were accepting donations made in crypto.

Tim Alper is a News Correspondent at DL News. Got a tip? Email him at tdalper@dlnews.com.

Standard Chartered has slashed its end-of-year price target for XRP by a staggering 65% as its analysts revise their outlook following February’s brutal crypto market selloff.

The British investment bank previously forecast XRP to hit $8 by the end of 2026. That prediction was lowered to $2.80 in a Thursday note to investors shared with DL News.

“Recent price action for digital assets has been challenging, to say the least,” Geoffrey Kendrick, the bank’s global head of digital assets research, said in the note. “We expect further declines near-term and we lower our forecasts across the asset class.”

In recent weeks, the crypto market has been hit by the worst market rout in almost four years.

Bitcoin fell 28% over the past month, hitting a low of $60,000 before rebounding.

Other crypto assets have fared just as poorly. Amid the rout, XRP briefly fell to $1.16, its lowest price in 15 months.

It has since bounced back, but is still down around 28% over the past month.

Big turnaround

It’s a big turnaround for the $90 billion Ripple-linked cryptocurrency.

By all accounts, XRP got off to a strong start in 2026. The asset rallied 25% in the first week of the year, buoyed by XRP exchange-traded fund inflows and regulatory tailwinds.

On January 5, the amount of money locked in XRP ETFs hit a record $1.6 billion, according to crypto data platform SoSoValue.

That figure has fallen to just over $1 billion — a 40% drop — as of February 13.

It’s not just XRP Standard Chartered has lowered its forecast for.

The bank also dropped its year-end target from $150,000 to $100,000 for Bitcoin, $7,000 to $4,000 for Ethereum, and $250 to $135 for Solana.

“We see XRP keeping pace with ETH. Both are likely to benefit from the further development of stablecoins and tokenised real-world assets,” Kendrick said.

Looking ahead

One of the biggest potential catalysts for a sustained XRP price recovery is the Clarity Act, a broad crypto market bill currently passing through the US Senate.

On Thursday, US Treasury Secretary Scott Bessent said the passing of the clarity Act will help the crypto market recover.

Last month, Katherine Dowling, president of Bitcoin Standard Treasury Company, told DL News XRP has the most to gain from the successful passage of the Clarity Act.

Progress on the bill stalled last month after banking chiefs and crypto executives disagreed on key parts of the legislation.

But the delays could soon be over. On February 10, Stuart Alderoty, Ripple’s chief legal officer, said that he’d had a “productive session” at the White House, and that now was the time to move ahead.

“Clear, bipartisan momentum remains behind sensible crypto market structure legislation,” Alderoty said. “We should move now — while the window is still open — and deliver a real win for consumers and America.”

Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.

Security experts have called on South Korean law enforcement agencies to overhaul their crypto management routines after police say they “lost” just under $2 million worth of Bitcoin confiscated during a criminal investigation.

Officers did not explain how the Bitcoin, kept on 22 USB thumb drives in a sealed vault in a police station in Seoul’s Gangnam District, had disappeared, leaving only the drives behind, South Korean newspaper Dong-A Ilbo reported.

Police only confirmed they are “investigating the circumstances surrounding the loss of confiscated Bitcoin.”

The revelations come hot on the heels of the news that prosecutors in the South Korean city of Gwangju last month admitted to “misplacing” over $28 million worth of Bitcoin confiscated from suspected online gambling operators in November 2021.

Investigations continue

Police in Seoul said they’d discovered the loss after the National Police Agency ordered an audit of all confiscated crypto held in cold wallets following the Gwangju case.

The lost Bitcoin was reportedly voluntarily submitted by a suspect during an investigation that dates back to November 2021. The investigation has since been suspended, but the cold wallets remained in police custody.

Unnamed security experts told South Korean newspaper Segye Ilbo the possibility of insider involvement could not be ruled out.

The fact that the Bitcoin had apparently been removed from the drives, leaving the devices intact, raises suspicions that someone with direct access to the cold wallets or their seed phrases may have been involved, the experts said.

The security officials called on the police and public prosecutors to “urgently and fundamentally redesign” their crypto management systems.

An inquiry in the Gwangju case has found evidence the Bitcoin was likely lost by prosecutors who had tried to use online tools to check how much Bitcoin was in cold wallet devices held in their own vaults.

Investigators say the prosecutors connected the wallets to a phishing website that had been disguised as a “cold wallet checker,” allowing criminals to steal the contents of crypto wallets.

The prosecution service says the coins were lost in August during a staff changeover. The Gwangju investigation is ongoing.

Tim Alper is a News Correspondent at DL News. Got a tip? Email him at tdalper@dlnews.com.

The cryptocurrency market “bubble is imploding” with Bitcoin’s price set to tumble another 85% to $10,000, warns Bloomberg Intelligence strategist Mike McGlone.

While traders may talk about a healthy correction, McGlone says the narrative around crypto is changing for a number of reasons.

“The buy-the-dip-mantra since 2008 may be over,” he wrote.

The factors include surging stock markets with low volatility and the industry losing faith in US President Donald Trump’s crypto boosterism. At the same time, gold and silver traders are grabbing profit “at a velocity last matched about half a century ago,” McGlone noted.

To him, this combination signals that more pain is coming for Bitcoin investors.

The warning — far from McGlone’s first — comes as Bitcoin’s price has already crashed nearly 30% in the past month amid a crypto industry downturn that has wiped out $2 trillion in market value.

Investors have dumped $678 million worth of Bitcoin exchange-traded funds so far in February, extending the $6 billion selloff since November, DefiLlama data shows.

To be sure, there are plenty of heavy hitters still bullish on Bitcoin.

On Thursday, US Treasury Secretary Scott Bessent said that the passage of crypto legislation such as the Clarity Act will shore up investors’ confidence and boost prices.

And institutions such as BlackRock and Goldman Sachs continue to up their exposure to Bitcoin and alternative cryptocurrencies like Ethereum.

Market jitters

Technology sector stocks, which Bitcoin price movements closely follow, are also being hammered by growing fears of severe disruption by artificial intelligence technology, now commonly dubbed the “AI scare trade.”

BlackRock’s flagship tech ETF, which tracks industry leaders like Microsoft, Oracle, and Palantir, is down 23% year-to-date.

On February 1, Microsoft, the largest corporate shareholder of OpenAI, saw its value tank by $357 billion in the second-largest selloff for a single trading session in history.

“Technological innovations tend to be disruptive and dynamic,” said Ed Yardeni, president of Yardeni Research. “That’s especially true with AI, which has the potential to disrupt itself.”

Technical obsolescence is moving at “warp speed,” he said.

“That pace has recently spooked investors who’ve been selling the stocks of any company that might be negatively disrupted by AI.”

Crypto market movers

Bitcoin is down 2.2% over the past 24 hours, trading at $68,717.

Ethereum is down 4.4% past 24 hours at $1,971.

What we’re reading

Bitcoin needs a quantum upgrade. So why isn’t it happening? — DL News

Clarity Act will lift Bitcoin price, says Treasury Secretary Bessent — DL News

BlackRock Just Chose Uniswap. The Market Didn’t Care. Here’s Why. — Unchained

Stop obsessing over the bottom — Milk Road

Binance France boss targeted in failed home invasion wrench attack — DL News

Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? Email him at lance@dlnews.com.