A new installment of Chain of Thought, the Brownstone Research newsletter written by Ben Lilly, argues that the battle over open-source artificial intelligence is following the same path Bitcoin walked a decade ago, and that investors who recognize the pattern stand to profit.
The note opens with testimony that Anthropic CEO Dario Amodei gave to Congress in July 2023. Amodei acknowledged that open source is “a good thing” in most scientific fields and that the risks of open models released so far were “relatively limited,” but he warned that the scaling of open-source models was heading “down a very dangerous path.”
Lilly reads the subtext plainly: if open models are dangerous, then the closed models sold by companies like Anthropic are the safe choice — and the policy that follows is to restrict the open and elevate the closed.
Bitcoin’s early skeptics mirror what AI is facing
That framing is one digital-asset investors know well.
He revisits Bitcoin’s early skeptics, from Rep. Jared Polis buying the first Bitcoin on Capitol Hill in 2014 to Sen. Joe Manchin’s call to ban a “dangerous currency,” through the 2023 accusations that regulators tried to cut crypto off from the banking system in what critics dubbed “Operation Choke Point 2.0.”
The industry survived, he notes, and Washington is now moving toward clearer rules through the passed GENIUS Act and the pending CLARITY Act.
Decentralized AI, which Lilly calls “DeAI,” is having that same fight now. He points to recent developments as evidence the walls are going up: a U.S. export ban on Anthropic’s latest release, which he says will push the company toward permissioned access that verifies a user’s identity before granting a model, and OpenAI’s decision to restrict its GPT-5.6 rollout to trusted partners.
He expects identity requirements to spread. “It’s for your protection, you see,” he writes. “It always is.”
The note leans on a national-security anecdote to explain the fear driving these moves. Lilly cites NSA chief Joshua Rudd, by way of Sen. Mark Warner, describing how Anthropic’s “Mythos” model broke into “almost all of our classified system, not in weeks, but in hours.”
Yet open source is closing the gap, according to the piece. Lilly says the recent GLM-5.2 scored on par with Anthropic’s Sonnet 4.6 from February, leaving open models roughly three to four months behind the frontier, and predicts an open rival to Mythos and GPT-5.6 by fall.
He argues the bigger unlock is decentralized training on peer-to-peer networks that mirror Bitcoin and Ethereum — swapping compute-for-network-security for compute-for-model-training. Distributed training, he notes, has grown from sub-1-billion parameters to 100 billion in two years.
He names three early projects — Dark Bloom, which enables low-cost private inference on idle Macs; c0mpute, a decentralized inference network; and Pluralis, which trains AI across distributed consumer GPUs — and expects more to launch tokens and reward users for contributing compute.
The note ends with the notion that governments will try to ban open models and they will fail. For him, investing in the space “will be like buying Bitcoin in 2014, back when it was still ‘dangerous.’”
A new independent non-profit, Ethereum Institutional, has launched with the goal of accelerating institutional adoption of Ethereum, its layer-2 networks and the broader ecosystem.
The organization is led by David Walsh, Marius Smith and Matthew Dawson. Walsh previously led the Ethereum Foundation’s enterprise efforts, while the organization said its leadership brings experience spanning institutional engagement, capital markets and Ethereum ecosystem development. It said its mission is to provide institutions with a neutral, independent point of contact as they evaluate Ethereum for tokenization, stablecoins and other onchain financial infrastructure.
In announcing the initiative on X, Ethereum Institutional said institutions need “a credible, independent front door” to the Ethereum ecosystem. While Ethereum’s neutrality is one of its defining strengths, the group argued, that neutrality has often left enterprises without a clear organization to engage as they make long-term infrastructure decisions.
The launch comes as the Ethereum Foundation continues to narrow its role to stewarding the core protocol, with ecosystem participants increasingly spinning up independent organizations focused on specific areas such as business development, institutional outreach and developer support. The shift follows broader changes at the foundation, including leadership restructuring and longstanding community calls for greater transparency.
Investment bank Standard Chartered has initiated coverage of Morpho, calling the lending protocol a dual-play on decentralized finance (DeFi) that combines a lending market with infrastructure for onchain banks and asset managers.
The bank has a $60 price target for MORPHO by the end of 2030, implying roughly 33x upside from its current price. This would see the token outperform both bitcoin BTC$60,299.90 and ether (ETH) over the same period.
MORPHO was more than 13% higher over 24 hours, trading around $2.13 at publication time.
“Given its status as one of the largest DeFi lending protocols and its comfortable financial position (it just raised $175 million in VC funding), we think Morpho can scale to meet the expanding base of assets deployed in DeFi,” wrote Geoff Kendrick,head of digital assets research at Standard Chartered, in the Wednesday report.
Decentralized finance has rebounded sharply over the past year as institutional interest in tokenized real-world assets and onchain lending accelerated. Lending protocols have benefited from rising stablecoin adoption and renewed demand for crypto credit, while infrastructure providers that enable asset managers and financial institutions to deploy capital onchain have emerged as one of the sector’s fastest-growing segments.
Cryptocurrency ATMs are fast disappearing from the American landscape as kiosk operators in two US states face bans and restrictions as new laws go into effect.
Crypto ATM laws passed by Tennessee and Georgia went into effect on Wednesday, imposing a complete ban in the former and requiring transaction limits and reporting in the latter. The measures by the two states followed bans in Indiana, which went into effect in March, and Minnesota, set to enforce an ATM ban on Aug. 1.
The Tennessee law, signed by Governor Bill Lee in April, bans the use and installation of cryptocurrency ATMs and kiosks, while the Georgia law requires that ATM operators cap money sent for new and existing users, issue warnings to customers and in some cases refund those who may have been the victims of fraud.
There were 185 crypto ATMs and kiosks operating in Tennessee before the statewide ban took effect on July 1. Source: CoinATMRadar
Many US state governments and municipalities have individually begun cracking down on crypto ATM operators in response to incidents of residents, particularly senior citizens, being conned into sending funds to scammers. Delaware and New Jersey lawmakers have proposed similar measures completely banning the machines.
Related: Massachusetts city to weigh crypto ATM ban, citing financial risks
The restrictions may have already contributed to at least one ATM operator going under. In May, Bitcoin Depot filed for Chapter 11 bankruptcy. The company had disclosed just days before that it had “substantial doubts” about its future amid a challenging regulatory environment and lawsuits.
“Bitcoin Depot’s bankruptcy is likely a preview of what the broader crypto ATM industry will face in the US over the next several years,” Roshan Dharia, CEO of Echo Base and a restructuring adviser, told Cointelegraph following the Chapter 11 filing. “The traditional model depended on high transaction spreads and limited regulatory scrutiny to offset unusually high compliance, cash logistics, fraud remediation, and retail revenue sharing costs. That equation is breaking down as states increasingly impose consumer protection standards that compress fees, expand operator liability for scam related activity, and raise expectations around transaction monitoring and reimbursement.”
Canada weighs countrywide ATM ban
Although not in effect yet, federal policymakers in Canada proposed a total ban on crypto ATMs across the country. The proposed policy, which would still allow Canadians to buy digital assets from brick-and-mortar money services businesses, was in response to what officials called the ATMs being the “primary method for scammers to defraud victims and for criminals to place their cash proceeds of crime.”
Magazine: Bitcoin slides to $58K, XRP hits $1 but onchain data promising: Market Moves
Bitcoin price climbed above $60,000 on Wednesday, a level the asset had ceded during the last couple weeks of turbulence, after Federal Reserve Chair Kevin Warsh told a central bank forum that the threat of persistent inflation had moderated.
The cryptocurrency traded near $60,171 this afternoon, a gain of about 2.7% on the day, with a 24-hour high of $60,474 and a low of $57,718. Trading volume for the session reached $26.68 billion.
Warsh, in remarks at the European Central Bank forum in Sintra, Portugal, said inflation expectations in surveys and bond prices had eased. He paired the observation with a warning that price growth remains too elevated and that the Fed will not accept inflation above its 2 percent target.
“We’re going to deliver price stability,” Warsh said.
Markets read the balance as a tilt toward relief. Bitcoin advanced as U.S. stocks rose and the dollar retreated from a weekly high. A softer dollar tends to lift demand for Bitcoin and other risk assets.
The move offered a reprieve in a hard year. Bitcoin sits about 30% below where it started 2026 and more than $66,000 under its record of $126,277, a slide that has kept the bear-market label in view. Its market value stands near $1.2 trillion.
Strategy (MSTR) and Strive (ASST) jump over 10% at times in intraday trading
Bitcoin treasury companies posted sharper gains. Strategy, the software firm turned Bitcoin holder under Michael Saylor, rose close to 7.5% on the day — with highs of 13% during the day. Strive jumped more than 10% at times to $12.02.
Both trade as leveraged proxies for Bitcoin, and their swings tend to exceed those of the coin. Strive has spent 2026 building a treasury that now tops 16,000 BTC, and the stock has climbed more than 100% across three months.
Earlier this week, Strategy released a new Digital Credit Capital Framework that raised the dividend on its STRC preferred shares to 12%, authorized up to $2 billion in share buybacks, and created a bitcoin monetization program allowing limited BTC sales for specific corporate purposes.
The company also established a $2.55 billion U.S. dollar reserve to cover preferred dividends and debt interest, with board rules requiring at least 12 months of coverage at all times. Strategy said any bitcoin sales would be limited to replenishing reserves, funding dividends and interest when preferable to issuing equity, or financing stock buybacks, while reaffirming bitcoin as its primary treasury asset.
Theo has invested $20 million in Fidelity International’s USD Digital Liquidity Fund through Sygnum Bank, adding FILQ to its onchain Treasury product thBILL.
The move makes Theo the first crypto-native platform to access Fidelity International’s tokenized fund offering.
Theo has invested US$20 million in Fidelity International’s USD Digital Liquidity Fund. With this investment, the onchain capital markets platform becomes the first crypto-native investor in the asset manager’s tokenized fund offering.
The investment was executed through Sygnum Bank and supported by Chainlink’s data and orchestration standards.
The move adds Fidelity International’s FILQ fund to Theo’s institutional tokenized Treasury product, thBILL.
This also expands the product beyondits existing exposure to ULTRA, a tokenized Treasury strategy managed by Wellington Management and FundBridge Capital and tokenized by Libeara.
FILQ is Fidelity International’s first tokenized product and is built on Sygnum’s Desygnate platform. The fund gives professional and institutional investors exposure to yield from regulated, highly rated government securities while keeping the instrument usable across onchain workflows.
The fund received an Aaa-mf rating from Moody’s.
Sygnum said Moody’s described the product as having “a very strong ability” to meet its objectives of capital preservation and high liquidity. The product is intended for professional and institutional investors through Sygnum and is subject to regulatory requirements in selected jurisdictions.
The integration matters because tokenized Treasury products are moving from proof-of-concept experiments into a more competitive institutional market.
Tokenized U.S. Treasury products now represent a multi-billion-dollar category, covering Treasury bills, bonds and Treasury-focused money market funds. RWA.xyz data shows $14.6 billion in distributed value across 84 tokenized Treasury assets, with 63,994 holders till July 1 2026.
RWA.xyz data shows $14.6 billion in distributed value across 84 tokenized Treasury assets, with 63,994 holders till July 1 2026. Image Source: RWA.xyz
For crypto-native firms, the appeal is straightforward.
Stablecoins offer instant settlement and broad onchain utility, but they generally do not pass yield to holders. FILQ is positioned differently: it combines money-market-fund-like yield exposure with the programmability and 24/7 usability expected in digital asset markets.
That is the gap Theo is trying to fill with thBILL.
By holding FILQ inside thBILL, Theo makes a traditional liquidity fund usable in onchain treasury, collateral, reporting and liquidity workflows. The aim is not just to tokenize fund units, but to make them functional inside crypto-native market structure.
Arijit Pingle, Co-CEO of Theo, said FILQ is “the strongest institutional foundation we’ve put under thBILL, and the first time a crypto-native platform has accessed Fidelity International’s tokenized fund offering.”
“The breadth of Fidelity International’s expertise across global fixed income makes this exactly the kind of institutional foundation our product was built for — accessible 24/7 onchain,” Pingle said.
The Fidelity allocation also gives Theo a second major asset-management relationship inside thBILL.
In December, Theo and Stable committed more than $100 million to ULTRA, a tokenized U.S. Treasury strategy managed by Wellington Management and FundBridge Capital. ULTRA uses Libeara’s tokenization infrastructure, while Standard Chartered provides custody for the underlying portfolio.
That makes thBILL a crypto-native Treasury product backed by exposure to funds linked to two large traditional asset managers.
The combination reflects a broader shift in tokenization: crypto firms are no longer only building synthetic yield products or lending pools. They are increasingly trying to plug regulated money-market and Treasury funds into digital asset rails.
Chainlink’s role is central to that design.
The company brings FILQ’s NAV and distribution data onchain through the Chainlink Runtime Environment. Sygnum’s earlier work with Fidelity International and Chainlink focused on bringing NAV data onchain for tokenized assets, a function the firms described as important for transparency, accessibility and historical data availability.
In the FILQ structure, J.P. Morgan provides daily NAV data that is received and approved before being made available onchain.
That data layer is important because tokenized funds need reliable pricing if they are to be used in collateral, treasury management and settlement workflows. Without trusted NAV data, the token may exist onchain but remain difficult to use in institutional risk systems.
Emma Pecenicic, Head of Digital Assets Distribution at Fidelity International, said tokenisation is “a foundational shift in how global financial markets will function.”
“By combining long-standing investment expertise with digital-native infrastructure, we are helping to enable regulated, institutional-grade liquidity on-chain for markets that operate around the clock, bringing new utility to onchain investors like Theo,” Pecenicic said.
The development comes as major financial institutions push deeper into blockchain-based settlement and tokenized funds.
J.P. Morgan, BlackRock, BNY and Franklin Templeton are among the large financial firms expanding work around tokenized funds, deposits and blockchain-based settlement. The U.S. Treasury market remains one of the largest and most systemically important markets globally, which is why tokenized Treasury products have become an early focus for institutional blockchain adoption.
Still, tokenization is not the same as liquidity.
A tokenized fund can offer faster settlement, better programmability and broader distribution, but its usefulness depends on investor access, regulatory permissions, pricing transparency and redemption mechanics.
Sygnum says FILQ supports 24/7 subscriptions and redemptions after onboarding, with near-instant settlement during market hours and liquidity facilities outside those hours, though transactions may be queued or subject to fees depending on conditions.
That distinction is important for institutions.
The market is moving toward always-on capital markets, but the underlying assets still sit inside regulated fund, custody and administration structures. The winners will likely be products that can combine blockchain settlement with institutional safeguards, rather than simply putting traditional assets onchain.
Fatmire Bekiri, Head of Tokenization at Sygnum, said the bank’s infrastructure was designed “to bridge institutional-grade assets and onchain markets.”
“Seeing FILQ back thBILL is a strong validation of the institutional-grade infrastructure emerging onchain,” Bekiri said.
The transaction gives thBILL a stronger claim to institutional-grade backing.
Moreover, it shows how tokenized Treasuries are becoming a bridge between crypto liquidity and traditional asset management — a space where Fidelity International, Wellington, Standard Chartered, Sygnum and Chainlink are now part of the same operating stack.
Johann Eid, Chief Business Officer at Chainlink Labs, said bringing secure NAV and distribution data onchain allows FILQ to be integrated into Theo’s thBILL workflows.
“We’re excited to accelerate the future where all the world’s value is tokenized onchain and powering 24/7 markets,” Eid said.
The above article “Theo Adds Fidelity’s FILQ to thBILL in Tokenized Treasury Push” was first published on AlexaBlockchain. Read the complete article here: https://alexablockchain.com/theo-adds-fidelitys-filq-to-thbill/
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Crédit Agricole (ACA), France’s second-largest bank by assets, unveiled a euro-pegged stablecoin, a rival to offerings from smaller peer Société Générale (GLE) and Circle Internet (CRCL) in a market that’s also targeted by Qivalis, a group of 37 European banks that plans to introduce its own contender later this year.
The coin, EURO eXchange Token (EURXT), is pegged 1:1 to the euro and complies with the European Union’s Markets in Crypto-Assets (MiCA) framework, according to a post on the website of its asset servicing unit, Caceis Bank, which is issuing the token. It has already been used to settle a subscription into a tokenized Amundi money market fund.
There are 20 million EURXT in circulation on Ethereum, backed 1:1 by euro reserves held by Caceis Bank. The compares with about 378 million of Circle’s EURC and 124 million of SocGen’s EURCV.
ESMA itself said in a February statement that firms with derivatives marketed as “perpetual futures” are likely to fall under the existing product-intervention measures on contracts for difference (CFDs). The commercial name, ESMA said, is irrelevant. Even voluntary negative-balance protection does not alter the analysis. If a perp meets the CFD definition, all CFD rules apply: leverage limits, a mandatory risk warning, margin close-out, negative balance protection and a ban on trading incentives. Those restrictions are a heavy burden on licensed derivatives providers in Europe.
The offshore market is teeming with sharks
A European investor can open an account at Hyperliquid, the largest decentralized perp trading platform, and take Bitcoin exposure with 50x leverage. Other platforms, like Aster, offer up to 200x leverage on bitcoin. Neither platform is authorized under MiCA or the Markets in Financial Instruments Directive (MiFID), which covers derivatives trading in the EU. There’s no loss limit that the EU can enforce, no key information document, no bonus ban, and no close-out rule, and they’re available to anyone with a self-custody wallet and a few minutes of free time.
And without those protections, retail investors almost always lose: when ESMA and national regulators reviewed the data in 2018, 74% to 89% of retail investment accounts lose money on CFDs across EU jurisdictions, with average losses per client ranging from €1,600 to €29,000.
Cloudflare opened a waitlist for its Monetization Gateway on Wednesday, letting customers charge for web pages, datasets, APIs or MCP tools with payments settling in stablecoins over the x402 protocol. Will Papper, formerly of Syndicate, joined the company as product manager for Agent Payments to lead the effort.
Cloudflare opened a waitlist Wednesday for its Monetization Gateway, a new tool letting customers charge for any web page, dataset, API or MCP tool sitting behind its network. Payments settle in stablecoins over the x402 protocol.
The announcement came from Cloudflare’s official X account Wednesday morning. Cloudflare, which says it handles roughly a fifth of global Internet traffic, is building on x402 through the x402 Foundation, the standards group the Linux Foundation launched in April.
Agent-Driven Web Traffic
Cloudflare pitched the product around AI agents replacing human visitors as the web’s dominant traffic source, arguing that shift makes per-seat and subscription pricing a poor fit for machine-to-machine transactions, since an agent reads a page or calls an API once rather than maintaining a monthly account. The same agent-traffic surge is what pushed rival infrastructure providers toward per-request billing over the past year.
The Monetization Gateway gives site operators a single control plane to set payment policies and enforce them at Cloudflare’s network edge, before a request reaches the origin server. It is Cloudflare’s answer to a problem stablecoin rails have targeted for over a year: collecting sub-cent payments cheaply enough that the transaction cost does not exceed the payment itself.
Papper Joins From Syndicate
Will Papper announced on X that he has joined Cloudflare as product manager for Agent Payments, tasked with building payment tooling on stablecoin rails, with the Monetization Gateway as the team’s first product. Papper spent the prior five years at Syndicate, a blockchain scaling and developer-tooling startup that wound down operations in June alongside two other crypto infrastructure projects.
Amazon Web Services took a similar step in June, plugging Coinbase’s version of the x402 protocol into CloudFront and letting publishers charge AI agents per request in USDC. Cloudflare’s Monetization Gateway applies the same pay-per-request model across its own network of customer sites, APIs and MCP tools.
Industry Reaction
Circle co-founder Jeremy Allaire called it “a big win for data providers and publishers,” saying it expands agentic monetization through x402 and USDC. Spark co-founder Sam MacPherson predicted stablecoin payments will drive the next market cycle, while Polygon Labs Chief Technology Officer Mudit Gupta asked which blockchains Cloudflare will support at launch, a detail the company has not yet disclosed publicly.
Cloudflare has not published pricing or a waitlist-to-launch timeline for the Monetization Gateway.
“A MiCA license is not something you can buy because you have money and power,” he said. “It is making sure every process is fully transparent.”
Still, Fazel acknowledged the new rules will be hardest on startups because obtaining and maintaining a license requires significant capital.
“If there’s one segment I feel bad for, it’s startups,” he said. “Innovation may suffer for companies that don’t have enough capital.”
A level playing field
For licensed exchanges, another question remains: whether regulators can enforce the new rules against firms operating outside the European Union.
Lin Han, founder and CEO of Gate Group, said licensed exchanges have spent years preparing for MiCA, but the framework only works if everyone follows it.
“Everybody needs to follow the rule,” Han said. “Then we can compete on better service for users.”
The European Securities and Markets Authority (ESMA) has said firms serving EU clients without MiCA authorization are breaching EU law and should stop offering those services. It has also warned firms not to rely on “reverse solicitation” to continue serving European customers and has encouraged measures such as geo-blocking to prevent access.
Han questioned whether regulators have the resources to prevent unlicensed platforms from continuing to operate from overseas.
