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ESMA Says Many Prediction Market Contracts Fall Under Existing EU Rules

The European Securities and Markets Authority (ESMA) has warned that many prediction market contracts may already fall under existing restrictions on binary options, saying companies cannot avoid financial regulations simply by marketing them as “event contracts.”

In a public statement on Friday, the regulator reminded companies that event contracts meeting the definition of financial instruments are already prohibited from being marketed, distributed or sold to retail investors under national measures implementing ESMA’s 2018 binary options restrictions.

ESMA said the assessment depends on a contract’s characteristics rather than how it is marketed, adding that event contracts with binary outcomes and fixed payouts are likely to qualify as financial instruments subject to the restrictions.

The regulator also told companies that offering qualifying event contracts to professional or institutional clients still requires authorization under the EU’s Markets in Financial Instruments Directive, or MiFID II, regardless of whether retail investors are excluded.

Excerpt from ESMA’s July statement on event contracts. Source: ESMA

The statement does not introduce new restrictions. ESMA said it issued the reminder after observing increased offerings of event contracts and the rapid growth of prediction markets, noting that qualifying binary options have already been subject to national restrictions across the EU since 2018.

Related: StanChart joins ESMA’s first MiCA register update since deadline

US prediction markets face growing legal battle

In the United States, a regulatory battle over prediction markets is unfolding, pitting state gaming regulators against the Commodity Futures Trading Commission (CFTC) over whether event contracts should be treated as gambling or federally regulated derivatives.

By March, authorities in 11 states had taken legal or regulatory action against platforms including Kalshi and Polymarket. Nevada became the first state to temporarily block Kalshi’s operations, while Arizona brought criminal charges alleging the company was operating an illegal gambling business.

The following month, the CFTC asserted “exclusive jurisdiction” over prediction markets, saying Congress had entrusted the agency with sole authority to regulate commodity derivatives markets, including event contracts. The regulator also said it had sued several states and filed court briefs supporting platforms, including Kalshi.

The CFTC’s April announcement defending its authority over prediction markets. Source: CFTC.gov

The legal battle has continued to escalate. On June 30, a Massachusetts judge allowed state authorities to file an amended complaint against Kalshi in an ongoing lawsuit alleging that the company’s sports-event contracts constitute illegal gambling under state law.

The dispute has also prompted calls for congressional action. Last month, the Indian Gaming Association and American Gaming Association, joined by tribal and labor groups, urged lawmakers to amend the CLARITY Act to explicitly prohibit sports-related event contracts on prediction market platforms, arguing they fall outside the CFTC’s authority and should remain subject to state gambling laws.

Some legal experts believe the growing conflict between federal and state regulators over prediction markets could ultimately be decided by the US Supreme Court.

Magazine: Bitcoin slides to $58K, XRP hits $1 but onchain data promising: Market Moves

Bitcoin’s next parabolic run is coming. But there’s a $1 trillion catch

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The 2015 cycle took about $69 billion for a gain near 10,000%. The 2018 cycle needed about $365 billion for roughly 2,000%. This cycle, running since 2022, has taken in about $697 billion and returned 689%. The figures track realized capitalization, a measure that values each coin at the price it last moved rather than its current price, a rough gauge of how much money has actually gone into the asset.
The trend holds at every scale. In 2011, roughly $5 million in new money was enough to double bitcoin’s price. This cycle, doing the same took around $101 billion. Each run has demanded exponentially more capital for a smaller percentage move, the arithmetic of an asset that now carries a market value near $1.2 trillion, per CoinDesk data, rather than the few billion it held a decade ago.

CryptoQuant founder Ki Young Ju, who published the data, called it as a case for patience rather than a top. “Bitcoin needs to be a core macro asset, not just a retail-driven ETF trade,” he wrote, arguing that another parabolic run is possible only if bitcoin can absorb more than $1 trillion in fresh capital, which would take institutional adoption well beyond where it sits today.

That argument lands at an awkward moment. U.S. spot bitcoin exchange-traded funds have seen record outflows over the past month, and bitcoin closed a losing first half, so the retail flows the thesis wants to move past are running in reverse rather than building the institutional depth it calls for.

US Law Enforcement Groups No Longer Opposes CLARITY Act

The Major County Sheriffs of America reportedly said it no longer opposes the CLARITY Act after initially raising concerns over how the bill would affect illicit finance investigations.

In a letter to US Senate Banking Committee chair Tim Scott and Senator Elizabeth Warren on Friday, the MCSA said it shifted its stance on the CLARITY Act to “neutral” after some of its concerns in a May 14 letter regarding Section 604 in the bill were addressed.

Section 604 relates to the Blockchain Regulatory Certainty Act, which seeks to protect developers from liability for illicit activity committed by users on their decentralized platforms.

The MCSA previously contended that Section 604 could create a loophole for criminals to exploit, making it tougher for law enforcement to investigate crypto-related crimes.

Source: Eleanor Terrett

While the CLARITY Act has bipartisan support, its passage through the Senate has largely been stalled by banking groups seeking to restrict stablecoin yield, which they argue functions like an unregulated deposit product that could drive trillions of dollars in outflows from the traditional banking system. 

The bill has been awaiting a full Senate vote since May, when the Senate Banking Committee passed the bill mostly along party lines.

Senators in favor of the bill are pushing for a full Senate vote this month, in hopes that it can be passed and signed into law before the US midterm elections in November.

One of CLARITY Act’s “biggest roadblocks” removed

Crypto investor Mark Chadwick described MCSA’s initial opposition to the CLARITY Act as one of the “biggest roadblocks” in preventing the Senate from passing the bill.

“With that hurdle now out of the way, the path to passage just got a lot clearer,” Chadwick said. “One more major hurdle down.”

MCSA still wants improvements to CLARITY Act

The MCSA said it would like the CLARITY Act to be amended to include state law enforcement in Section 309, which requires the Treasury Department to study decentralized finance and illicit finance risks.

Related: Senate leaders push for July passage of CLARITY Act 

MCSA President Bob Gualtieri argued that Congress should provide the training, technology and resources needed to “investigate increasingly sophisticated digital asset-enabled activity” tied to fraud, narcotics trafficking, ransomware, child exploitation, terrorism financing and other crimes.

“State and local law enforcement agencies investigate these crimes every day and must have the tools, partnerships, and resources necessary to identify offenders, trace illicit proceeds, recover assets, and protect victims.”

Magazine: Does ‘Paper Bitcoin’ mean there’s an unlimited supply of BTC?

Trump’s Quantum Push Pressures Bitcoin Security: Moody’s

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A pair of executive orders signed by President Trump on June 22 has pushed the quantum computing question from the research lab into the boardrooms of crypto exchanges, custodians and stablecoin issuers. 

In a June 24 sector comment, Moody’s Ratings warned that the credit implications for digital assets are significant, and that the industry now faces pressure to prove it can defend the cryptography at its foundation.

The orders make quantum computing and its security a strategic national priority. One directs the development of a quantum computer “powerful enough to initiate the era of quantum-enabled scientific discovery,” with system specifications due within 90 days. 

A second accelerates the federal migration to post-quantum cryptography, moving preparedness deadlines to 2030-31 from the prior 2035 target. 

That four-year jump is the detail crypto builders should note.

Moody’s frames the risk in stark terms for public blockchains. Bitcoin relies on public-key cryptography to secure ownership, authorize transactions and manage core infrastructure. A sufficiently capable quantum computer could break the elliptic-curve signatures that guard private keys. 

Unlike a bank wire, an on-chain transaction offers limited ability to reverse a theft or recover funds. As the analysts put it, compromised keys “may lead to immediate and irreversible on-chain outcomes.”

The finality that makes Bitcoin trustless also removes the safety net.

Moody’s: There is a 2030 deadline for a decentralized network

The near-term danger is not a working quantum machine but a strategy called “harvest now, decrypt later.” Adversaries capture encrypted data today and store it for the day a capable machine arrives, an event the industry calls “Q-Day.” 

For Bitcoin, dormant wallets and reused addresses with exposed public keys form a standing target. Satoshi-era coins, held in early pay-to-public-key outputs, sit among the most exposed.

Moody’s expects market participants to face growing demand for “cryptographic agility,” the ability to inventory, update and replace vulnerable algorithms without severe disruption. 

The firm suggests exchanges, custodians and tokenization platforms will need migration paths toward quantum-resistant standards, plus honest assessments of the exposure in existing wallets, custody arrangements and smart contracts.

There is a credit-rating logic underneath the warning. Institutions that present credible quantum transition plans, Moody’s argues, stand better positioned to win adoption from regulated financial players and to satisfy rising supervisory expectations on cyber resilience. 

For a sector courting Wall Street and pension money, quantum readiness becomes a gatekeeping requirement rather than a distant science project.

For Bitcoin, the technical fix exists in the form of proposed quantum-resistant signature schemes, but adoption demands consensus, soft forks and coordinated wallet migration across a decentralized network. That is the harder problem. Moody’s has now put a date on the deadline, and the clock reads 2030.

Metaplanet Adds 2,823 Bitcoin, Reaches 43,000 BTC And Becomes World’s Third-Largest Corporate Treasury

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Metaplanet crossed the 43,000 BTC threshold on July 2, a milestone that places the Tokyo-listed firm as the world’s third-largest corporate Bitcoin holder. The company now trails Strategy and Twenty One Capital across the global corporate ranking, and its climb underscores Japan’s role in the corporate Bitcoin accumulation race.

Metaplanet acquired an additional 2,823 BTC during the second quarter of 2026, a purchase worth about $170.7 million. The buy brought total holdings to 43,000 BTC, valued near $2.6 billion. Shares of the company (ticker 3350) closed 3.5% higher at 207 yen ($1.28) on Thursday following the announcement.

The average acquisition price for the quarter landed at roughly 12.71 million yen (about $80,000) per Bitcoin, according to the company. The effective purchase price fell to around 12.09 million yen (about $77,000) once income from the firm’s Bitcoin Income Generation business is counted. 

That segment produced approximately 1.75 billion yen ($10.85 million) in operating revenue for the quarter, lifting first-half revenue to about 4.72 billion yen. On a trailing 12-month basis, the division’s revenue reached about 11.4 billion yen.

Metaplanet’s total Bitcoin investment now stands at approximately 659.25 billion yen (about $4.2 billion), with holdings valued near 409 billion yen (about $2.6 billion) as of June 30. The overall average cost basis sits at 15.33 million yen (about $102,500) per BTC.

The company reported a BTC Yield of 6.6% for the quarter ended June 30, 2026, a metric that tracks growth in Bitcoin per share. That figure remains a core indicator for corporate treasury strategies of this type.

The corporate Bitcoin leaderboard is now well defined. Strategy, the former MicroStrategy, leads with holdings above 847,000 BTC. Twenty One Capital holds second place. Metaplanet takes third, a position that puts it ahead of other large players such as MARA Holdings, according to data tracked by Bitcoin Treasuries.

Michael Saylor marked the occasion on X, tweeting, “Congrats to Metaplanet on reaching ₿43,000 and becoming the #3 corporate Bitcoin treasury in the world. You are proving that the Bitcoin treasury strategy is global.”

The strategy behind Metaplanet

Metaplanet has scaled at speed since it adopted the treasury model in 2024. CEO Simon Gerovich has drawn on equity offerings, debt instruments, and options strategies to build the position, an approach designed to limit the shareholder dilution that comes with large corporate purchases. The Bitcoin Income Generation business uses Bitcoin options to create recurring cash flow while the company expands its holdings.

The balance sheet leaves room to grow. Total debt and preferred stock represent about 23% of the net asset value of the firm’s Bitcoin, a cushion that gives Metaplanet capacity to keep buying.

The dual model, one part aggressive accumulation and one part recurring income, cements Japan as a rising force in the corporate push to hold Bitcoin as a reserve asset.

US Senator Calls for Ban on Elected Officials Issuing Memecoins

Senator Kirsten Gillibrand, one of the US lawmakers behind negotiations for a digital asset market structure bill in Congress, has proposed barring elected officials and the president from issuing or sponsoring their own tokens, citing President Donald Trump’s and First Lady Melania Trump’s memecoins.

In a Friday notice, Gillibrand said that Congress should support measures barring elected officials and their spouses from “issuing or sponsoring their own digital assets.” The New York lawmaker said that the proposed restriction would include any US president and their spouse, but did not specifically mention extending the provision to the office of the vice president or other members of their families. 

“This is a commonsense requirement that should get broad bipartisan support – public officials and their spouses should not be issuing memecoins,” said Gillibrand. “We cannot let self-dealing destroy an opportunity to strengthen consumer protections, crack down on illicit finance, and expand economic opportunity for the millions of Americans our financial system has left behind.”

Source: Kirsten Gillibrand

Gillibrand is one of the lawmakers behind negotiations regarding the Digital Asset Market Clarity (CLARITY) Act in the Senate, legislation which has faced delays due to concerns about ethics, tokenization and stablecoin rewards. Although she expected the chamber to vote on the bill by the Senate’s August state work period, she added that no one would vote for the bill without addressing ethics, citing the potential of elected officials “[getting] rich off of these industries because of their insider status.”

Related: Senate Dems urge probe into $500M crypto deal between Trumps, UAE 

During consideration of the Guiding and Establishing National Innovation for US Stablecoins Act (GENIUS Act) in 2025, the New York lawmaker said senators had removed provisions specifically targeting Trump’s ties to the crypto industry, including his memecoin Official Trump (TRUMP). 

She said at the time that the memecoin was likely “illegal based on current law,” but addressing all of Trump’s ethics problems would make for a “very long and detailed bill.” Trump signed the GENIUS Act into law in July 2025.

Notably, Gillibrand’s proposed memecoin restriction did not appear to extend to other family members. In addition to his personal investments in the crypto industry, Trump has faced criticism over his sons’ involvement in the crypto platform World Liberty Financial and their Bitcoin (BTC) mining company American Bitcoin.

Trump brushes off conflicts of interest concerns with crypto industry

This week, Trump reported that he earned about $1.4 billion from crypto ventures the same year he took office. The financial windfall occurred while he was in a position to influence legislation on digital assets, including the GENIUS Act and the CLARITY Act.

According to Trump, there was “nothing illegal” and “nothing wrong” with profiting from his investments as president, while he did not directly answer questions about perceived conflicts of interest.

Magazine: The end of anonymity? AI could unmask crypto’s hidden identities

SOL Tops $83 As Solana Network Activity Surges

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Key takeaways:

  • Solana’s tokenized assets and memecoin revival drove SOL to a 30-day high at $83.
  • Bullish leveraged appetite cooled sharply, suggesting traders are hesitant to bet on further gains to $90.

Solana’s SOL token jumped to its highest mark in over 30 days on Friday at $83, marking a decoupling from the altcoin market. SOL’s rally gained steam from a surge in tokenized trading volume on Solana, inflows of stablecoin liquidity, and an unexpected comeback in memecoin activity. Can SOL reclaim the $90 level?

Total altcoin market capitalization, USD (left) vs. SOL/USD (right). Source: TradingView

SOL’s bullish momentum ignited on June 23, coinciding with cumulative tokenized stock transfers on Solana surpassing $10 billion. The launch of SpaceX shares trading by Backpack propelled Solana’s decentralized finance (DeFi) utilization. In contrast, the broader altcoin market extended its downtrend, hitting the lowest level since December 2023.

30-day tokenized assets net flows ex-stablecoins, USD. Source: RWA.xyz

Tokenized assets on the Solana network surged to a record-high $3.5 billion on Wednesday, up from $2.7 billion one month prior. The recent boost came from corporate credit tokens and stock market indexes, such as the S&P 500 and the Nasdaq-100. According to RWA.xyz data, Solana leads with 294,274 active addresses in the tokenized industry, followed by Ethereum with 204,955.

Memecoins, prediction markets surge may push SOL toward $90

The airdrop of The Black Bull (ANSEM) memecoin on Sunday re-ignited interest in the sector. The token, launched on Pump.fun, reached a $60 million market capitalization on Tuesday. The anonymous developer directed some 65% of the supply to the crypto influencer Ansem’s public wallet. The distribution lacked transparency, but involved 74,000 addresses over the initial 3 days.

Top 7-day performances of Solana tokens. Source: CoinRanking

Multiple memecoins on Solana surged on the back of the memecoin airdrop, but the biggest winner was the Pump.fun platform token (PUMP). The 27% weekly gains were enough to send PUMP back into the top-100 crypto rankings, with a $630 million market capitalization. ANSEM memecoin extended its gains on Friday, reaching an all-time high market capitalization of $112 million.

The launch of World prediction markets integrated on Phantom wallet has created expectations for increased Solana activity. The project gathered nearly $890,000 in total value locked in two days and aims to compete with the extremely successful Polymarket amid the World Cup betting frenzy. Jupiter has also unveiled its prediction markets under beta test on June 29.

Related: US dominates Polymarket political bets despite geoblock–Report

SOL perpetual futures annualized funding rate. Source: Laevitas

The appetite for bullish leveraged positions has vastly declined since Wednesday, when SOL’s price crossed above $75 for the first time in 30 days. SOL futures annualized funding rate dropped to 3% on Friday from an 11% peak two days prior. Under neutral conditions, the indicator should range from 6% to 12% to offset the capital cost.

Investors are not comfortable betting on a SOL rally to $90 merely on the back of a temporary memecoin demand surge. Unless there is sustainable demand for blockchain activity, there are no apparent drivers for SOL to further widen its performance gap relative to the remaining altcoins.

SEC Opens 60-Day Comment Period on ‘Novel’ ETF Rules as Prediction Market Funds Pile Up

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The SEC published a formal request for comment on ‘Novel ETFs’ covering crypto-asset and prediction-market funds, following Chair Paul Atkins’ May statement pausing launches for over two dozen pending applications.

The Securities and Exchange Commission has opened a formal review of how it regulates “Novel ETFs,” a category covering crypto-asset funds and products tied to prediction markets, publishing a request for comment as release 33-11426.

The filing seeks comment on ways to facilitate innovation in the ETF space while protecting investors, maintaining fair, orderly and efficient markets, and facilitating capital formation, according to the SEC’s filing. The filing notes that the ETF market has grown significantly since the Commission adopted Rule 6c-11 in 2019 — the exemption that lets most ETFs launch without a bespoke exemptive order — a rule the agency credits with fostering greater competition, innovation and investor choice in the ETF space. Comments are due within 60 days of Federal Register publication.

The review follows a May 20 statement from SEC Chair Paul Atkins, who said fund sponsors had voluntarily delayed the launch of “a number of novel ETFs, including event contract ETFs” while the agency weighed the implications. Atkins said ETF assets had tripled since 2019 and that he had “instructed the staff to seek input from the public on how the Commission should respond to recent market changes.”

Prediction-market ETF applications tied to events like elections and interest-rate decisions have been stuck in the SEC queue since earlier this year, Bloomberg reported, as the agency weighs whether the standard review timeline is adequate for a wave of structurally similar filings.

The pileup coincides with a surge in prediction-market trading volume onchain. Kalshi and Polymarket have expanded rapidly in 2026, with Kalshi closing a $1 billion raise in May at a $22 billion valuation before reportedly seeking a $40 billion mark weeks later. The Defiant has previously covered Kalshi’s push into crypto perpetual futures and broader asset classes following its own $5.5 billion crypto product launch.

Public comments on release 33-11426 can be submitted through the SEC’s comment portal once the 60-day window opens following Federal Register publication, expected in the coming days.

FBI Director Patel Omitted Strategy (MSTR) Stake

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FBI Director Kash Patel disclosed a six-figure investment in Strategy (MSTR), the world’s largest corporate holder of Bitcoin, more than six months past the deadline set by federal ethics law, according to a report from NOTUS. The lapse has reopened a fight over stock trading by senior government officials and raised questions about a potential conflict of interest.

Patel purchased between $100,001 and $250,000 in shares of Strategy on November 21, 2025. He did not report the trade to federal regulators until May 26, 2026, a gap of more than 180 days. The Stop Trading on Congressional Knowledge (STOCK) Act requires senior executive-branch officials to disclose individual stock trades over $1,000 within 45 days of the transaction.

In his May 26 letter to the Office of Government Ethics, Patel said the trade had been “inadvertently omitted” from a prior filing. Two days later, Deputy Assistant Attorney General William Taylor attributed the omission to a miscommunication, and an FBI official told NOTUS the late reporting was “not realized and unintentional.” 

First-time STOCK Act violators face a $200 fine. The Department of Justice, which would issue or waive the penalty, has not fined Patel. The bureau said the corrected filing was reviewed and approved by a DOJ ethics official.

Why Patel’s stock omission is drawing attention

Strategy, the firm led by Michael Saylor, pioneered the corporate Bitcoin-treasury model and holds more than 760,000 BTC. The stock functions as a proxy for the price of Bitcoin, which makes it one of the most direct routes to a Bitcoin bet through a brokerage account. Strategy’s shares have lost about half their value since the date of Patel’s purchase.

The identity of the company is the crux of the concern. The FBI, under Patel, plays a central role in cryptocurrency enforcement, and Patel has promoted that record.

In a June 19 post on X, he warned crypto fraudsters that “this FBI will find you, and we will bring you to justice.” Weeks before his purchase, he had touted a case that seized roughly $15 billion 

Strategy has done millions of dollars in business with the Justice Department, of which the FBI is a part, along with the Departments of Health and Human Services, Defense, and State, over the past decade, according to the report.

Taylor maintained that Patel’s stake does not create a conflict of interest with his oversight of the bureau.

Patel is not an outlier. Vice President JD Vance disclosed up to $500,000 in Bitcoin, and President Trump and his sons reported more than $1 billion in crypto-related income last year. 

Securitize Tokenizes Its Own NYSE Stock SECZ on Its First Day as a Public Company

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Securitize put its own newly listed common stock onchain the same day SECZ began trading on the NYSE, launching tokenized shares on Avalanche and Solana through its regulated platform.

Securitize began trading on the New York Stock Exchange Thursday under the ticker SECZ and simultaneously put its own newly listed common stock onchain, according to a press release the tokenization firm distributed via PR Newswire. Eligible U.S. investors can access tokenized SECZ through Securitize’s own regulated platform starting the same day.

The launch makes Securitize the first newly public company to bring its own stock onchain at the start of its life as a listed issuer, per the release. SECZ is expected to become the world’s largest tokenized stock at launch based on anticipated shareholder participation.

The shares began trading Thursday after Securitize completed its merger with Cantor Equity Partners, the SPAC vehicle that took the company public with roughly $400 million in proceeds. The Defiant previously reported shareholder approval of that deal, which made Securitize the first publicly traded tokenization company.

Tokenized SECZ will launch on Avalanche and Solana, the release states, giving the company a multichain footprint from its first day as a listed issuer. Access requires onboarding, KYC and AML checks, and confirmation of jurisdictional eligibility under U.S. securities law.

“We have long said that public equities are moving onchain, and there is no stronger validation of that belief than tokenizing our own public stock on Day 1,” Securitize co-founder and CEO Carlos Domingo said in the release. Domingo said tokenized SECZ represents the same common stock trading on the NYSE rather than a separate share class or a synthetic wrapper, and that tokenization changes the form of ownership without altering the underlying legal rights or transfer restrictions attached to the shares.

Securitize is the leader in real-world-asset tokenization by assets under management, with more than $4 billion tokenized as of June 2026 across funds run with asset managers including BlackRock, Apollo, KKR, BNY and Hamilton Lane. The company also holds a memorandum of understanding with the NYSE signed in March to help design transfer-agent and tokenization-agent standards for the exchange’s broader push into tokenized securities.

Domingo framed the self-tokenization as a template beyond Securitize itself. “Bringing SECZ onchain is not just a milestone for Securitize,” he said. “It is a blueprint for public companies that want to use tokenization to create more efficient, transparent and useful ownership experiences for their shareholders.”

Securitize expects tokenized SECZ to build a meaningful onchain shareholder base from day one, with additional functionality expected to develop over time, the release states.