On Monday, Coinbase (COIN) announced a new partnership with Circle (CRLC), the issuer of the USDC stablecoin, to create what they claim to be “the world’s first fully on-chain national economy” in Bermuda. 

Coinbase, Circle To Build New Digital Asset Infrastructure 

Under this initiative, Coinbase and Circle are set to provide digital asset infrastructure and enterprise tools to various stakeholders, including the Bermuda government, local banks, insurers, and small and medium-sized enterprises.

Bermuda’s Premier, E. David Burt, commented on the initiative, stating, “This initiative is about creating opportunity, lowering costs, and ensuring Bermudians benefit from the future of finance.”

Government agencies are expected to begin piloting payments using stablecoins such as Circle’s USDC, while financial institutions are set to adopt tokenization tools. Residents will also have the opportunity to engage in nationwide digital literacy programs that foster understanding of the emerging financial landscape.

The announcement highlighted that transitioning to an on-chain economy is anticipated to include reduced transaction costs and improved access to global finance, facilitated by modern digital wallets and infrastructure with Coinbase and Circle’s support.

Bermuda’s Crypto Landscape

Bermuda has positioned itself as a leader in the digital asset space, having established its own regulatory framework for digital assets as early as 2018. This approach has attracted numerous companies looking for regulatory clarity amid tightening regulations in other regions. 

The country’s regulatory framework currently supports a diverse range of regulated digital asset activities. The Bermuda Monetary Authority (BMA) is responsible for licensing crypto exchanges, yield-bearing stablecoin structures, and decentralized finance protocols under a cohesive supervisory regime. 

This structure enables tokenized money market funds to operate within the jurisdiction, and even allows digital-native insurers to manage reserves, collect premiums, and process claims using cryptocurrency, all while adhering to traditional financial oversight.

Bermuda’s focus on digital finance has generated significant business interest. Notably, in late 2024, the BMA issued the world’s first license to a decentralized derivatives exchange governed by a Decentralized Autonomous Organization (DAO). 

The jurisdiction also accommodates regulated derivatives operations linked to major exchanges, including Coinbase and Kraken, showcasing ongoing institutional confidence in its clear regulatory framework. 

Furthermore, Bermuda has attracted utility-driven firms like Haycen, which utilizes specialized stablecoins to offer faster trade financing, effectively bridging gaps often encountered by conventional banks.

In addressing the risks associated with digital finance, Premier Burt acknowledged that no financial system can be fully insulated from risk. “In life, you can’t insure anything,” he stated in an interview. 

He emphasized the importance of policymakers balancing caution with humility, allowing room for innovation while maintaining a robust regulatory environment in this still-evolving sector.

Featured image from DALL-E, chart from TradingView.com 

XDC Network is targeting faster and cheaper Australia–U.S. business payments with its new AUDD–USDC liquidity pool, aiming to replace slow, high-fee banking rails with near-instant on-chain settlement.

• Fees collected from takers are redistributed daily to liquidity providers in USDC.
• The highest fees apply when market odds are near 50% and fall toward zero at extremes.
• Longer-term crypto, political, and non-crypto markets remain fee-free.

Prediction market platform Polymarket has made a subtle but meaningful change to how some of its crypto markets operate.

Updated documentation on the site shows that 15-minute crypto up and down markets now carry taker fees, a break from the platform’s long-standing zero-fee trading model.

The update appeared without a formal announcement and applies only to a narrow segment of markets.

Most Polymarket markets remain fee-free, signalling a targeted structural adjustment rather than a platform-wide shift.

The change was identified through revisions to Polymarket’s Trading Fees and Maker Rebates Program documentation.

These sections now explain that taker-only fees have been enabled on short-duration crypto markets to fund liquidity incentives.

Archived versions of the documentation indicate that this language is new, suggesting the fee model was introduced recently and without public notice.

Documentation reveals new fee structure

According to the updated material, the taker fees apply solely to 15-minute crypto markets.

These are short-term contracts designed for rapid price movements, where liquidity conditions can change quickly.

The platform states that fees collected from takers are redistributed daily to liquidity providers in USDC stablecoin, rather than retained by Polymarket itself.

This redistribution mechanism positions the fee as a funding tool for market makers rather than a revenue stream for the platform.

Other markets, including longer-term crypto predictions, political markets, and non-crypto events, continue to operate without fees.

Fees tied to market odds

The documentation outlines a variable fee model based on market odds.

Fees are highest when prices are close to 50%, a range typically associated with the greatest uncertainty and trading activity. As odds move closer to 0% or 100%, the fee declines sharply toward zero.

Examples included in the documentation show how this plays out in practice.

A taker trade of 100 shares priced at $0.50 would incur a fee of about $1.56, which is slightly over 3% of the trade’s value at the peak of the curve.

Smaller trades and those placed near probability extremes face lower charges, with very small fees rounded down.

Social media reaction frames intent

The quiet rollout prompted discussion on X, where several users framed the move as a market-structure adjustment rather than a conventional fee increase.

X user 0x_opus said the change would increase protection from wash trading, arguing that the platform is not charging users in the traditional sense because the fees are redirected to liquidity providers.

Another trader, kiruwaaaaaa, described the move as being directed against high-frequency bots, saying the fee-funded rebates could incentivise tighter spreads and more consistent liquidity.

A third user, Tawer955, offered a more detailed breakdown, calling the headline effect of the change “scary, but not as bad as it sounds.”

He said the structure creates a sustainable cash flow for liquidity providers while reducing incentives for bots that previously exploited free liquidity.

Impact limited to select markets

For the majority of Polymarket users, the change is expected to have a limited impact. Only 15-minute crypto markets are affected, while the rest of the platform remains fee-free.

Even within the affected markets, the fee design reduces costs for directional trades and those placed near clear probability outcomes.

By concentrating fees around the most competitive price ranges and redistributing them to liquidity providers, Polymarket appears to be fine-tuning incentives in its fastest markets without altering the broader user experience.

The post Polymarket quietly changes fee model for short term crypto markets appeared first on CoinJournal.

• An unauthorised contract upgrade enabled direct withdrawals from the protocol.
• Funds were bridged to Ethereum and laundered through Tornado Cash.
• Assets affected included WIP, USDC, WETH, stIP, and vIP.

A governance failure at Unleash Protocol has resulted in a major security breach, with attackers draining around $3.9 million in user funds.

The incident was first identified by blockchain security firm PeckShieldAlert and later confirmed by the Unleash team.

While the exploit did not affect the wider Story ecosystem, it has renewed attention on how governance mechanisms can become a critical point of failure in decentralised finance.

Unleash Protocol is a decentralised platform built on Story Protocol.

The project said the incident was limited to its own contracts and administrative controls, with no signs of compromise across Story Protocol’s validators or core infrastructure.

Even so, the event shows how vulnerabilities at the application level can still lead to significant losses.

Governance controls bypassed

On-chain analysis indicates the attacker targeted Unleash Protocol’s multi-signature governance system.

By exploiting weaknesses in how admin permissions were enforced, the attacker gained unauthorised access normally reserved for approved signers.

This access was then used to push through a contract upgrade that had not been sanctioned by the core team.

The unauthorised upgrade altered how the protocol handled withdrawals. With standard governance checks effectively bypassed, the attacker was able to move funds directly out of the protocol.

According to Unleash, these actions occurred outside its established governance framework and were not detected until after the funds had already been removed.

Laundering through bridges and mixers

After extracting the assets, the attacker bridged the funds to Ethereum. From there, the assets were broken into multiple transactions, a strategy often used to make tracking more difficult.

Blockchain data shows that 1,337.1 ETH was later deposited into Tornado Cash. The deposits were made in varying sizes, ranging from small transfers to batches of up to 100 ETH.

This pattern suggests a deliberate attempt to obscure transaction trails and reduce the effectiveness of on-chain monitoring tools.

Tokens impacted

In an official incident notice, Unleash Protocol confirmed that several assets were affected during the exploit.

These included WIP, USDC, WETH, stIP, and vIP.

The team reiterated that all affected withdrawals took place through the unauthorised contract upgrade rather than through normal user interactions.

The clarification that Story Protocol itself was not compromised is significant.

It indicates that the breach stemmed from Unleash’s internal governance design, not from flaws in the underlying blockchain or its validator set.

Emergency measures taken

Following confirmation of the breach, Unleash Protocol paused all platform operations to prevent further losses.

The team said it is working with independent security experts and forensic investigators to determine how the governance safeguards were bypassed and whether additional vulnerabilities remain.

Users have been advised to avoid interacting with Unleash Protocol contracts until further updates are issued.

The project has stated that future communications will be shared only through official channels as the investigation continues.

The post How a governance failure led to the Unleash Protocol hack appeared first on CoinJournal.

• The strategy focuses on a major protocol upgrade, real-world asset lending, and mobile adoption.
• Aave V4 aims to unify cross-chain liquidity and simplify development.
• Horizon targets faster growth in tokenised real-world asset markets through institutional partners.

Aave is setting out its next phase of expansion as regulatory uncertainty in the US eases for the decentralised finance protocol.

Founder and chief executive Stani Kulechov on Dec. 17 detailed what he described as a “2026 Master Plan”, one day after the US Securities and Exchange Commission formally dropped its long-running investigation into the platform.

The update comes after what Aave described as its strongest year so far, with 2025 marked by record net deposits and billions of dollars in activity processed across the protocol.

With the regulatory probe no longer hanging over the project, Aave’s leadership is now focusing on scaling its technology, widening its institutional footprint, and pushing further into consumer-facing products.

According to Kulechov’s post on X, Aave’s strategy for 2026 rests on three core priorities: a major protocol upgrade, the expansion of tokenised real-world asset markets, and broader user adoption through a mobile app.

Aave V4 upgrade

The first pillar of the roadmap is Aave V4, the next major iteration of the lending protocol.

The upgrade is designed to introduce cross-chain liquidity, a modular architecture, and deeper customisation for developers and partners.

Aave Labs, the core development team, had already published a V4 launch roadmap in September, outlining final testing and review phases.

A central feature is the Cross-Chain Liquidity Layer, which builds on earlier versions of the protocol to address fragmented liquidity across different blockchains.

Under the new design, liquidity pools are reorganised into capital hubs on each network, with specialised spokes layered on top to support tailored lending markets for specific asset types.

The structure is intended to support significantly larger volumes of capital while simplifying how new products are launched on Aave.

The upgrade also includes new cross-chain interfaces and a revamped developer experience, which Aave expects will make integrations easier for fintech firms, enterprises, and other large-scale users.

Horizon and institutional markets

The second focus area is Horizon, Aave’s decentralised lending market for tokenised real-world assets.

Horizon is positioned as a gateway for traditional financial institutions to access DeFi infrastructure while bringing off-chain assets on-chain.

Horizon launched on Aug. 27 and surpassed $50 million in deposits by September 1, with most of the early liquidity arriving in RLUSD and USDC. Since then, net deposits have grown to around $550 million.

Aave plans to accelerate Horizon’s growth in 2026, with a stated aim of pushing deposits beyond $1 billion.

The strategy involves expanding collaborations with established financial players including Circle, Ripple, Franklin Templeton, and VanEck.

Through these partnerships, Aave intends to onboard major global asset classes and expand its reach into a real-world asset market estimated at more than $500 trillion.

Aave App and user growth

The third pillar of the roadmap targets consumer adoption through the Aave App. Launched in mid-November, the app offers a banking-style savings experience designed to make decentralised lending more accessible to non-crypto-native users.

The app is currently available on the Apple App Store and is expected to see a broader rollout next year.

Aave is targeting a user base of one million as it seeks a foothold in the global mobile fintech market, which it estimates at about $2 trillion.

The push reflects Aave’s view that long-term scaling depends on product-level adoption, not just protocol-level liquidity.

The post Aave charts post-SEC expansion as DeFi lender sharpens growth strategy appeared first on CoinJournal.