Interview transcript

Terry Gerton Anthropic says Chinese hackers used its Claude chatbot to automate a cyber espionage campaign against tech firms, financial institutions, and government agencies, marking what could be the first large-scale AI-driven attack. Joining me to explain what this means for defenders and what’s next for nation-state tactics is the former department head of AI security at MITRE and co-founder of AI security consulting firm Fire Mountain Labs, Dr. Josh Harguess. Dr. Harguess, thank you for joining me.

Josh Harguess Thank you very much for having me.

Terry Gerton We’re going to talk about something that really made the news not too long ago. Anthropic said that its AI tool Claude was used by Chinese hackers with minimal human intervention to launch a cyber espionage campaign. Can you tell us more about what really happened?

Josh Harguess Yeah, I can. So a really nice report that they lay it out, really detailed, but some of the high marks. So they used Claude code to do this. So this is Anthropic’s own tool that allows you to sort of, you know, vibe code as it were, and create a code that was able to do these exploits. And by create, what I mean is they were able to execute something like 80 to 90% of these operations completely independently from human interaction. That 10 to 20% was sort of like human-on-the-loop, human-in-the-loop verifying, validating some of the things that came back from Claude code, like hallucinations  things that weren’t actually real, but there were plenty of exploits that were real, that were able to execute without any human intervention. And they really did this by doing these safeguard bypasses, things like social engineering, so doing prompt injection techniques, these kinds of things, convincing the tools that they were using. That everything that they’re doing was on the up and up. You know, no issues, don’t worry about what we’re trying to do. This is, you know, we’re security professionals. We’re trying to secure our own infrastructure, our own networks. So you’re doing us a service by providing this code to us. And yeah, the breach was, this was a campaign. I think they started to notice this maybe back in September. So they were able to kind of follow this campaign and eventually disrupt it.

Terry Gerton You mentioned some things like prompt injection and social engineering. Tell us a little bit more about how those were able to bypass Claude’s safety guardrails and what that means for the average person who might be a victim of some of this approach.

Josh Harguess Yeah, absolutely. So this has been around since ChatGPT Was released, so essentially these are ways to convince the model to do things that it’s not supposed to do. So particularly over the past two or three years, OpenAI, Anthropic, Google, they’ve spent a ton of money on trying to build in these safeguards so that you can’t get instructions for how to make a nuclear weapon or how to do other nefarious things that these models, they don’t want you to be able to do. However, there are ways around this and we’re seeing this even with today’s models. It’s more sophisticated. It’s not as easy as some of the early days where you just say the word poem infinitely and then it spits out user data. So now you do have to dig a little deeper. You have to do what’s called maybe crescendo attacks. You have to, you know, sort of aggregate different attacks together in order for this to be successful. But these models are all susceptible at some point to this kind of prompt injection technique.

Terry Gerton It sounds like you and others with your expertise might have been expecting something like this to come along. It’s not just something that woke up overnight.

Josh Harguess Definitely. Absolutely. We’ve been sounding the warning alarms about this for many years So it’s very well known and really that awareness piece is number one. I mean, I think a lot of people, to your point, are going to be very surprised that this is even possible

Terry Gerton So tell us more about how that 10 or 20% of human interaction played in with the cyber attack.

Josh Harguess Yeah, definitely. So, yeah, it’s interesting. So we’re not at the place where you can just say, go execute all of this for me, actually execute the campaign, you know. Get back to me in a few days when you’ve actually been able to recover these credentials and get into accounts and all that kind of thing. So right now we’re still at the phase where, you know, there’s a certain amount of trust for these models to do something that you tell it to do. And this is in, you know, your everyday task. If you’ve ever tried to write a summary of an article or something like that, you know, you’re not always gonna get 100% of what you’re expecting out of these models. So there’s some amount of human-on-the-loop or human-in-the-loop to kind of validate and verify what you are getting back. And this is no different. So, you know some of the things that came back were, you know, code that didn’t run or code that actually didn’t do the task that they were trying to do. So it was very much breaking the problem up into smaller pieces. Executing those small pieces, validating that they worked, and so on.

Terry Gerton I’m speaking with Dr. Josh Harguess. He’s the former department head for AI security at MITRE and co-founder of the AI security consulting firm, Fire Mountain Labs. The organizations that were targeted in this cyber attack, everything from financial institutions to tech companies to chemical manufacturers and government agencies, these might be the folks that you would expect to have the most resilient defense. How did they fare?

Josh Harguess Yeah, I mean, it’s difficult to protect yourself against the unknown, right? So I think a lot of these organizations, like you mentioned, they will be doing their best to protect themselves against kind of known adversaries. So they’re protecting their data, they’re protection their identities, these sorts of things, but they’ve never seen something this sophisticated kind of come at their infrastructure, and so quickly. So I think a lot times in the past if they saw a campaign like this, and it was human operated. They would be able to sort of see the signals and be able to react. In this case, the campaign was so fast acting that they weren’t able to react in time. And I think that’s really the escalation of these types of attacks.

Terry Gerton What does that mean for AI defense or hacking defense going forward? If the hacker is AI powered and can adjust so quickly, how can the defenders meet that kind of attack?

Josh Harguess Absolutely, so we’re definitely getting into that space that we were fearing in the beginning where we’re going to have to use AI tools to help us defend against these kinds of attacks. And not just these types of attacks, probably all attacks. The same exact thing is going to happen though where you’re going want to defend yourself against attacks using AI, however, that AI may not do exactly what you expect it to do all the time. So it’s the same kind of back and forth. You’re going to need a human-in-the-loop, human-on-the-loop to sort of validate, verify these defenses, check in, make sure that they’re operating as they should. These are the kinds of things that we do as a consultancy, help folks through this. So, you know, how do you secure your own AI systems? That’s a big question mark. That’s what we help people through. And you have to be able to secure your own AI systems before you can use them for these types of defenses.

Terry Gerton If AI is attacking and AI is defending and all of that is happening at machine speed, what is the risk — what are the vulnerabilities there and what is risk of escalation?

Josh Harguess Yeah, absolutely. So same as we kind of talked about earlier, you have to break the problem down into kind of consumable pieces. So look at your entire ecosystem of defense. Where can you instantiate AI? One place that’s really obvious is attacking yourself. So firming up your own defenses by pretending you’re an adversary. So red teaming your own system using these tools before someone else on the outside does that.

Terry Gerton As you look forward, what does this mean in terms of nation-state relations? How do nations prepare and how does this change the threat landscape?

Josh Harguess Yeah, certainly. So there’s multiple ways of looking at the changing of the threat landscape. My co-founder likes to talk about this in terms of these three words, intent, opportunity, and capability. Intent, that’s not really going to change. There’s always going to be bad actors that are trying to do nefarious things. Opportunity, that’s certainly expanding. So as these AI models and these AI agents kind of dig deeper into our digital infrastructures, we have new avenues for exploitation. So, you know, in this case, it was the social engineering way of getting into the models. There’s going to be other ways of getting in in the future that we’re not aware of yet. And then capability, that’s really the big one here. You know, AI is the force multiplier in this case, and that’s what we need to be utilizing, but also securing for our own systems.

The post When hackers weaponize AI, the rules of cyber defense change overnight first appeared on Federal News Network.

© Getty Images/iStockphoto/Urupong

The U.S. Securities and Exchange Commission says some third-party Bitcoin mining hosting deals can amount to securities, according to a federal lawsuit tied to an alleged $48 million fraud involving mining firm VBit Technologies.

In a complaint filed Wednesday in the U.S. District Court for the District of Delaware, the SEC accused VBit founder and former CEO Danh C. Vo of misleading thousands of investors.

Regulators claim the company sold unregistered investment contracts linked to hosted Bitcoin mining operations.

At the center of the case are so-called “Hosting Agreements” promoted by VBit between late 2018 and early 2022. The SEC says the contracts were pitched to retail investors as a largely hands-off way to generate passive income through Bitcoin mining.

Why the SEC Says VBit’s Mining Contracts Were Securities

Bitcoin mining typically involves running specialized computers to validate transactions on the Bitcoin network in exchange for newly minted coins.

The SEC alleges Vo used the technical complexity of the process to promote a turnkey model in which investors were told they owned mining rigs that would be pooled and operated entirely by VBit.

Returns were marketed as proportional to each investor’s share of computing power, or hashrate.

According to the complaint, nearly all of VBit’s customers entered into these Hosting Agreements, which were sold in tiered packages ranging from lower-cost plans to premium offerings that purportedly included up to eight mining rigs.

Investors were encouraged to choose hosted mining rather than operating equipment themselves through discounted pricing, longer contract terms, and promises of steady returns without operational involvement.

The SEC alleges those representations were false. Court filings state that VBit sold far more hosting agreements than it had the mining equipment to support.

In 2020, the company allegedly sold agreements covering more than 3,300 rigs while operating fewer than 1,000.

In 2021, agreements reportedly covered more than 8,400 rigs, while only 1,643 were in operation.

As a result, the hashrate promised to investors could not be delivered.

The agency further alleges that investors never owned or controlled specific mining equipment and were entirely dependent on Vo and VBit’s operations to generate profits.

Trump son Eric Trump-backed American Bitcoin intends to use the net proceeds from $220 million raised in a new share issuance to fund for Bitcoin equipment purchase.#EricTrump #AmericanBitcoin #Hut8https://t.co/23zTABD4tb

— Cryptonews.com (@cryptonews) July 1, 2025

On that basis, the SEC argues the Hosting Agreements meet the definition of investment contracts under the Supreme Court’s Howey test and therefore should have been registered as securities.

Investors Locked Out as SEC Says Mining Firm Moved Funds Offshore

Under U.S. law, an arrangement can be deemed a security if investors contribute money to a common enterprise with a reasonable expectation of profits derived primarily from the efforts of others.

The SEC claims VBit’s hosting model satisfies all four elements, placing it within federal securities rules governing registration, disclosure, and anti-fraud protections.

The complaint also accuses Vo of fabricating investor account balances through an online portal that displayed hypothetical mining returns unrelated to actual Bitcoin production.

The bitcoins that were mined were allegedly controlled exclusively by Vo.

The SEC says that between December 2020 and November 2021, Vo transferred approximately $48.5 million of investor funds to personal accounts, distributed millions to family members, and used investor money for cryptocurrency trading.

After learning of the SEC’s investigation in 2021, Vo allegedly left the United States. VBit later announced it had been sold to an entity called Advanced Mining Group, which the SEC describes as a shell company used to maintain the appearance of ongoing operations.

By mid-2022, investors were locked out of their accounts.

The SEC is seeking permanent injunctions, disgorgement, civil penalties, and a ban preventing Vo from serving as an officer or director of a public company. A jury trial has been requested.

The post SEC Labels Third-Party Bitcoin Mining a ‘Security’ in $48M Fraud Bust appeared first on Cryptonews.

In the city that’s home to Microsoft, Redmond Police Chief Darrell Lowe isn’t just watching technological innovation from the sidelines — he’s integrating it into his department’s daily operations.

Lowe, a 30-year law enforcement veteran, views Redmond as the ideal staging ground for a new era of policing that capitalizes on advancements ranging from drones as first responders to artificial intelligence. When he became chief six years ago, his vision was to transform the department into a premier agency; technology has been a cornerstone of that mission.

“The public safety tech space is blowing up right now with a lot of interest and investment and VC money,” Lowe told GeekWire. “Being in Microsoft’s backyard doesn’t hurt, but it’s not like Microsoft is cutting checks for the Redmond Police Department.”

Lowe, who also runs his own public safety tech consultancy, primarily seeks tools that increase staff efficiency and simplify officer tasks. An AI-powered investigative platform from San Francisco-based Longeye fits that bill. Longeye ingests digital information such as surveillance video, phone records, crime scene photos and interviews to analyze data at speeds that exceed human review.

Lowe recently told KING 5 how the tool helped investigators confirm key evidence in a cold case by combing through 60 hours of jail phone calls in minutes.

However, he maintains that such tools are part of the equation rather than the total solution.

“It’s really important for law enforcement agencies and officers not to get lazy and think AI is the answer, because you still have to corroborate whatever that is,” Lowe said.

While AI is a newer addition to Lowe’s tech toolbox, the department has a history of technical adoption. Previous deployments included adhesive GPS trackers fired at cars to catch fleeing suspects. and handheld narcotics analyzers that can scan through transparent packaging and identify more than 530 controlled substances, such as fentanyl, methamphetamine, and heroin.

But drones — specifically drones as first responders — are Lowe’s pride and joy. He equates their impact on modern policing to the era when handheld radios replaced police call boxes.

With a current staff of approximately 85 officers, Lowe employs two full-time drone pilots operating from a flight control center equipped with autonomous drones from Seattle-based Brinc and Skydio. Integrated directly into the department’s dispatch system, the drones can launch and arrive on-scene in under two minutes.

Lowe recalls a recent call regarding an individual experiencing a mental health crisis on a street corner. The person was screaming at the sky and waving his arms.

“Typical police response is you send an officer on the ground to make contact. We’ve seen those calls escalate and go wrong,” Lowe said.

Instead, a drone arrived in 30 seconds. From 250 feet, a pilot observed the individual, determined no crime was occurring and no one was in danger, and watched as the person eventually walked away.

“We canceled the ground unit response. There was no need for police contact,” Lowe said.

To address privacy concerns, Lowe implemented a “horizon-first” policy: drone cameras are pointed at the sky during transit and only tilt down once they reach the specific GPS coordinates of a call.

While drones have been a “game changer,” other technologies have hit speed bumps. The Redmond City Council recently paused the department’s license plate reader program following regional concerns about data sharing and whether U.S. Immigration and Customs Enforcement (ICE) could access the data.

Redmond PD started deploying Automated License Plate Readers (ALPRs) this summer to alert officers and analysts when a vehicle linked to a crime, missing person, stolen vehicle, or other critical incident is detected.

Lowe pushed back on what he calls “hysteria” surrounding the technology, arguing that cameras have a proven, valuable place in law enforcement.

“There is no expectation of privacy in a public place on a tax-funded road,” Lowe said, noting that Washington’s tolling cameras often capture more personal data (including driver faces) for longer periods than his ALPR systems. “The privacy concerns, while I understand they are legitimate, they also have to be balanced against what the law says.”

Because the City of Redmond signed a contract to launch the ALPR technology, Lowe noted that the council must now consider any legal ramifications of a potential breach of contract.

Reflecting on a long career that began in an innovative department in Santa Monica, Calif., under then-Chief Jim Butts, Lowe feels fortunate to have technology embedded in his “cop DNA.”

Now he laughs at how much the job description has evolved.

“When we all got into this, we wanted to go out there and catch bad guys … play cops and robbers and that whole thing,” he said. “I never imagined that I’d be negotiating multi-million-dollar, multi-year [tech] contracts as a cop.”

But even with modern advances, Lowe insists technology will never replace an officer’s empathy.

“We can never take the human out of the loop,” he said. “When people contact the police, it’s often not on their best day. It’s to have another human there to empathize and sympathize. It’s the reason why most of us got into this profession — to help others.”

StackHawk co-founder and CSO Scott Gerlach has spent most of his career running security teams, and his take on application security is shaped by a simple reality: developers are still too often the last to know when their code ships with risk. Gerlach explains why that gap has widened in the age of modern CI/CD,..

The post Why AppSec Can’t Keep Up With AI-Generated Code appeared first on Security Boulevard.

• Coinbase argues the Commodity Exchange Act gives the CFTC exclusive authority over event contracts.
• Earlier cases involving Kalshi show courts have yet to settle the issue decisively.
• The rulings could shape how prediction markets and related financial products develop nationwide.

Coinbase has taken its dispute with US regulators to court as it expands into prediction markets, filing lawsuits against authorities in Connecticut, Illinois, and Michigan.

The legal challenge centres on a fundamental question facing financial markets in the United States: whether prediction markets should be regulated at the federal level as financial derivatives or treated by states as gambling products.

Coinbase argues that the answer has already been set out in federal law.

State regulators disagree, setting up a clash that could redefine oversight for event-based markets tied to finance, politics, and real-world outcomes.

A jurisdictional battle takes shape

The exchange’s case is built around the Commodity Exchange Act, which grants the Commodity Futures Trading Commission authority over derivatives, including event contracts.

Coinbase maintains that prediction markets listed on CFTC-supervised platforms fall squarely within this framework.

From the company’s perspective, state efforts to apply local gambling laws amount to regulatory overreach.

Paul Grewal, Coinbase’s Chief Legal Officer, has positioned the lawsuits as a response to what the company sees as a direct conflict between federal authority and state enforcement.

Coinbase argues that allowing individual states to intervene risks creating a fragmented regulatory system that undermines national consistency. In that scenario, stricter jurisdictions could effectively block federally approved products across the country.

Gambling labels under scrutiny

A central issue in the lawsuits is how prediction markets are defined.

State regulators have moved to classify them alongside sports betting and casino-style gambling.

Coinbase rejects this comparison, arguing that the mechanics are fundamentally different.

Prediction markets operate as marketplaces that match buyers and sellers who take opposing views on future events.

Prices are set by market demand rather than by a house that manages odds.

Coinbase says this structure aligns prediction markets with derivatives trading, not wagering, and places them within the scope of federal commodities law rather than state gaming statutes.

Federal oversight and compliance claims

Coinbase has also pointed to the regulatory obligations attached to CFTC-supervised markets.

These include monitoring for manipulation, position limits, and ongoing compliance requirements designed to protect market integrity.

According to the exchange, these safeguards already address many of the consumer protection concerns cited by state regulators.

Ryan VanGrack, Coinbase’s Vice President of Legal, has argued that state-level intervention risks duplicating or conflicting with federal oversight.

The company maintains that pulling prediction markets under local gambling rules ignores how federally regulated derivatives markets operate and threatens uniform supervision.

The post Who regulates prediction markets? Coinbase forces a US legal test appeared first on CoinJournal.

Large on-chain movements involving Bitcoin whales have a way of putting the market on edge, especially when they involve transfers to centralized exchanges. A new transaction involving 5,152 BTC moving into Binance has now raised questions around potential sell pressure at a time when Bitcoin’s price action is fragile, highly reactive, and struggling to get a hold of bullish momentum.

Bitcoin Whale Moves 5,152 BTC Worth $445 Million To Binance

On-chain data identified by whale transaction tracker Lookonchain has revealed that a long-term Bitcoin holder deposited 5,152 BTC, valued at approximately $444.73 million, into Binance. The data, sourced from Arkham Intelligence, shows the wallet belongs to an entity tagged as Bitcoin OG (1011short), a trader known to hold a massive combined long position estimated at around $695 million across Bitcoin, Ethereum, and Solana.

The size and destination of the transfer immediately drew attention, as coins sent to exchanges are typically interpreted as becoming available for trading activity. Moving such a large amount of BTC onto Binance increases immediate sell-side liquidity and shows that the whale address is in preparation for selling. This follows the recent trend of whale addresses selling their Bitcoin holdings and a general lack of buying pressure for the cryptocurrency.

Interestingly, Lookonchain data shows that the same Bitcoin OG (1011short) wallet recently added another 12,406 ETH to its long exposure, pushing its current holdings to 203,341 ETH worth about $577.5 million, alongside 1,000 BTC valued near $87 million and 250,000 SOL worth roughly $30.7 million. Despite increasing exposure, the wallet is now down more than $70 million, having seen profits fall from over $120 million to less than $30 million at the time of writing.

Bearish Whale Behavior Is Not Isolated

This Binance deposit is not occurring in isolation. Lookonchain also noted activity from another whale address, 0x94d3, which has taken explicitly bearish action over the past several hours. According to the data, the whale sold 255 BTC worth approximately $21.77 million at an average price of $85,378 before opening a 10x leveraged short position on 876.27 BTC, valued at about $76.3 million. The same wallet also initiated a leveraged short on 372.78 ETH worth roughly $1.1 million.

Bitcoin’s recent price action makes these whale moves especially impactful. The leading cryptocurrency has failed to hold above $90,000 again and recently fell to a 24-hour low of $84,581. This movement has seen Bitcoin trading in a volatile range, repeatedly revisiting support zones around the mid-$80,000 region. Upside follow-through above $90,000 has been limited, and this has left the cryptocurrency vulnerable.

Interestingly, a careful look at on-chain data shows that any movement that looks like accumulation in recent days is not organic buying but only reshuffling among wallets.

The ChatGPT maker is aiming to raise the funding by the end of the first quarter in 2026, and the company may ask sovereign wealth funds to invest in the round.

On-chain analytics platform Glassnode has revealed the number of Bitcoin supply that is currently sitting at a loss. This comes as the BTC price continues to trade below the psychological $90,000 level following its crash, which began last month. 

Here’s The Amount Of Bitcoin Supply At A Loss

In a report, Glassnode revealed that the Bitcoin supply in loss has risen to 6.7 million BTC, marking the highest level of loss-bearing supply observed in this cycle. The analytics platform further noted that this represents 23.7% of the circulating supply, which is currently underwater. 10.2% of this supply is held by long-term holders and 13.5% by short-term holders. 

Glassnode stated that this distribution suggests that, much like in prior cycle transitions into deeper bearish regimes, the loss-bearing Bitcoin supply accumulated by recent buyers is gradually maturing into the long-term cohort.

Meanwhile, the analytics platform noted that the 6-7 million range, which has been at a loss since mid-November, mirrors early transitional phases of prior cycles, where mounting investor frustration came before a shift toward more bearish conditions and intensified capitulation at lower Bitcoin prices. 

Notably, the Bitcoin price has dropped to levels last seen in 2024, erasing its year-to-date (YTD) gains. Glassnode stated that this has left behind a dense supply cluster accumulated by top buyers in the $93,000 to $120,000 range. The resulting supply distribution is said to reflect a top-heavy market structure where recovery attempts are capped by heavy overhead sell pressure, especially in the early stages of a bearish phase. 

Glassnode declared that as long as the Bitcoin price remains below this range and fails to reclaim key thresholds, most notably the Short-Term Holder Cost Basis at $101,500, the risk of further corrective downside persists.

BTC Spot Demand Is Unstable  

Glassnode revealed that the Bitcoin spot market flows continue to reflect an uneven demand profile across major venues. The Cumulative Volume Delta bias is said to show periodic bursts of buy-side activity, but has failed to develop into sustained accumulation, especially during the recent BTC price pullbacks. 

The on-chain analytics platform noted that the Coinbase spot CVD remains relatively constructive, indicating steadier participation from US-based investors. On the other hand, Binance and aggregate Bitcoin flows remain choppy and largely directionless. Glassnode stated that these dispersion points point to selective engagement rather than coordinated spot demand. 

Meanwhile, the platform alluded to recent Bitcoin price declines, which it pointed out have not triggered decisive expansion in positive CVD. Glassnode noted that this suggests dip-buying remains tactical and short-term. In the absence of sustained accumulation across all venues, Bitcoin’s price action continues to rely more on activity in the derivatives market and liquidity conditions rather than organic spot demand. 

At the time of writing, the Bitcoin price is trading at around $86,800, up in the last 24 hours, according to data from CoinMarketCap.

If there’s one thing car buyers consistently want, it’s an engine they never have to worry about. And while the market is full of complex hybrids, turbos, and high-strung performance motors, one humble Japanese four-cylinder has quietly built a reputation that outlasts most of the vehicles it’s been installed in. After more than 25 years on the market, its track record for reliability, longevity, and low running costs has made it one of the most trusted powerplants still in production.

The U.S. Senate has confirmed crypto-friendly lawyer Mike Selig as the next chair of the Commodity Futures Trading Commission (CFTC), ending a prolonged period of leadership uncertainty at one of the country’s most important financial regulators.

The confirmation passed Thursday as part of a mass approval of federal nominees, with senators voting 53–43 under the provisions of Senate Resolution 532.

Confirmed, 53-43: Confirmation of the en bloc nominations provided for under the provisions of S.Res.532.

— Senate Cloakroom (@SenateCloakroom) December 19, 2025

Selig’s confirmation comes as President Donald Trump’s second administration moves to fill some of the most consequential regulatory vacancies affecting the digital asset sector.

Alongside Selig, the Senate also elevated Travis Hill to chair the Federal Deposit Insurance Corporation (FDIC), placing permanent leadership at two agencies that play central roles in how crypto markets operate and how crypto companies interact with the banking system.

Power Without a Mandate: The CFTC’s Quiet Struggle Over Crypto Oversight

At the CFTC, the absence of a Senate-confirmed chair had become a growing operational problem. The agency, which is structured as a five-member independent commission, has been operating for months with just a single commissioner.

Acting Chair Caroline Pham remained the only seated member after a wave of resignations earlier in the year, a situation that concentrated authority while also limiting deliberation and long-term planning.

The chair of the U.S. Commodity Futures Trading Commission (CFTC), Rostin Behnam, has announced his resignation, effective January 20, according to a Financial Times report.#CFTC #CryptoRegulations https://t.co/1AY9hfcCKv

— Cryptonews.com (@cryptonews) January 7, 2025

Although an acting chair can legally carry out agency functions, the lack of a permanent leader and full commission constrained the CFTC’s ability to build staff, coordinate with other regulators, and advance major new rulemakings.

That leadership gap mattered most for crypto policy. While Congress continues to debate legislation that would expand the agency’s mandate, the absence of a confirmed chair made it harder for the CFTC to set a clear regulatory direction or prepare for an expanded role.

Senate introduces new Crypto Market Structure Bill draft to expand @CFTC authority over digital commodities like $BTC and $ETH.

#ClarityAct #CFTChttps://t.co/qKO9rR7aYs

— Cryptonews.com (@cryptonews) November 11, 2025

Previous nominees, including Brian Quintenz, were withdrawn amid political friction, extending the period of uncertainty.

During this interim phase, Pham focused on internal reforms rather than sweeping regulatory changes.

Her tenure emphasized clearing compliance backlogs, streamlining enforcement processes, and launching limited pilot initiatives tied to digital assets.

Pham led a “back-to-basics” approach, resolving internal backlogs and launching early digital asset initiatives, but the lack of a permanent, Senate-confirmed chair made it harder to advance complex rulemakings or coordinate closely with other regulators such as the Securities and Exchange Commission.

The agency also began what it called a “crypto sprint,” a set of targeted efforts that included updating regulatory language to reflect blockchain-based markets and formally approved spot crypto trading.

Selig’s Term Begins as CFTC Prepares for a Larger Role in Crypto Markets

Selig now takes on the role with a full and permanent mandate. He is a former CFTC official and most recently served as chief counsel to the SEC’s Crypto Task Force. He was nominated in October, replacing the administration’s earlier choice for the position.

US President @realDonaldTrump is preparing to nominate @MikeSeligEsq as the next chair of the @CFTC#Trump #Cryptohttps://t.co/UUjnN7ENyC

— Cryptonews.com (@cryptonews) October 25, 2025

His term as chair will run through April 2029. During his confirmation process, Selig said crypto would be a priority and also pointed to ongoing challenges at the agency, including limited staffing, tight resources, and governance concerns.

The CFTC currently employs about 543 full-time staff, far fewer than the SEC’s roughly 4,200 employees, even as lawmakers in both chambers consider bills that would give the CFTC primary oversight of crypto spot markets.

Once sworn in, Selig, the current acting chair, Pham, will depart to join crypto payments firm MoonPay as chief legal and administrative officer.

The US CFTC Chair Caroline Pham will join crypto payments firm MoonPay, following the Senate's confirmation of her successor, Mike Selig.#CFTC #CarolinePham #MoonPayhttps://t.co/Bu3z0uGLvI

— Cryptonews.com (@cryptonews) December 18, 2025

While operating with a single commissioner may allow faster internal decision-making, it also raises questions about legal durability and bipartisan balance.

Several senators have already stated that confirming additional commissioners will be a key issue in 2026.

The post Senate Confirms Pro-Crypto Mike Selig as CFTC Chair — What To Expect appeared first on Cryptonews.

Concerns over quantum computing are weighing on Bitcoin’s price and slowing some investment flows, amid a sharp divide between developers and many investors.

Developers Call Threat Distant

According to Bitcoin developer Adam Back of Blockstream, quantum machines remain far from able to break Bitcoin’s protections. He said the tech is still “ridiculously early” and that research hurdles persist.

Back expects no real threat within the next decade and argued that even if parts of Bitcoin’s cryptography were compromised, the network would not automatically be emptied.

Security, he noted, does not rest solely on encryption in a way that would allow mass theft on the blockchain.

i think the risks are short term NIL. this whole thing is decades away, it’s ridiculously early and they have massive R&D issues in every vector of the required applied physics research to even find out if it’s possible at useful scale. but it’s ok to be “quantum ready” and

— Adam Back (@adam3us) December 18, 2025

The Risk That Keeps Some Awake

Other voices in the community disagree. Jameson Lopp, a well-known Bitcoin engineer, has warned about the worst-case outcome if quantum advances allowed attackers to break the ECDSA signature scheme that secures many wallets.

In that scenario, forged signatures could be used to move funds, and user confidence might erode quickly. That warning has been repeated as a technical possibility, not as something imminent.

How should we treat quantum vulnerable coins in a future where quantum computing becomes a threat? This panel from the Presidio Quantum Bitcoin Summit features myself, @theblackmarble, and @cryptoquick.https://t.co/jhr6hjLXru

— Jameson Lopp (@lopp) September 14, 2025

Investors Worry, Capital Shifts

Nic Carter, a partner at Castle Island Ventures, told observers that it is “extremely bearish” when influential developers appear to dismiss any quantum risk outright.

He said the gap between investor concern and developer assessment is large. Reports have disclosed that some capital is being held back while large holders consider spreading risk into other assets.

Craig Warmke of the Bitcoin Policy Institute added that perceived quantum risk has already pushed some holders to reduce their Bitcoin positions.

Quantum risk is stemming the flow of capital into bitcoin, and encouraging large holders to diversify out of bitcoin.

When non-technical people express concerns, they sometimes use technically incorrect language. It’s frustrating to see technical people dismiss concerns with an… https://t.co/MtSNY7Ivg3

— Craig Warmke (@craigwarmke) December 18, 2025

Current Technology Falls Short

Most cryptographers agree quantum computers today are not powerful enough to crack Bitcoin’s cryptography. That assessment is widely reported by analysts who follow both fields.

Metaculus’s median date for when quantum computers will break modern cryptography is 2040:https://t.co/Li8ni8A9Ox

Seemingly about a 20% chance it will be before end of 2030.

— vitalik.eth (@VitalikButerin) August 27, 2025

Still, the timeline is debated. Based on reports from researchers and public comments from industry figures like Vitalik Buterin, there is a measurable chance — about ~20% — that a machine capable of breaking today’s crypto could exist by 2030. That estimate has prompted calls for proactive steps.

Calls For Preparedness Grow

Financial institutions and national programs, the reports say, are investing heavily in quantum work, and tools like AI are accelerating research in the field. As a result, many in the crypto world argue contingency plans should be ready well before any practical threat appears.

Suggestions include moving to quantum-resistant signature schemes and improving wallet practices so funds are not left exposed while upgrades take place. Some experts point out that banks and other big targets may face attacks earlier, which could give the crypto sector time to respond.

Featured image from Shutterstock, chart from TradingView

Taiwan has taken custody of about 210.45 BTC. According to official responses shared with lawmakers, the coins were seized during criminal probes into fraud, money laundering and other illegal activity.

The holdings were listed in a government inventory dated October 31, 2025, and the figure was made public amid questions from lawmaker Ko Ju-Chun.

Seized Crypto Under Judicial Control

Reports have disclosed that the Bitcoin is held under judicial custody, not as a national reserve. Court procedures determine what happens next.

Some assets may be returned to victims, some kept for evidence, and some could be forfeited or auctioned after legal review. No formal plan to convert the holdings into state reserves or investments has been announced.

The seized portfolio includes more than just Bitcoin. Officials recorded 2,429.97 ETH and sizable sums of stablecoins such as USDT and USDC. Based on reported totals, the combined value of these crypto assets exceeded NT$1.3 billion.

BREAKING: The Ministry of Justice has just revealed that Taiwan now holds 210.45 Bitcoin in seized assets.

Another nation-state holding Bitcoin pic.twitter.com/bp6VJ90rDM

— Bitcoin Magazine (@BitcoinMagazine) December 18, 2025

That amount converts to millions of US dollars at current exchange rates. At recent market levels, the 210.45 BTC alone is worth roughly $18 million, a figure that will move with Bitcoin’s price.

Value And Composition Of Holdings

According to public documents and reporting, Taiwan’s stockpile places it among several jurisdictions that hold cryptocurrency through law enforcement action.

Rankings that track seized or government-held crypto put Taiwan near other countries that have accumulated coins via criminal investigations.

Law enforcement seized these assets during a string of investigations into digital asset fraud and illicit exchanges. Some cases involved networks that used crypto to hide proceeds.

Other seizures came from raids tied to financial crime. Officials say the assets remain linked to ongoing legal processes, and ownership claims must be resolved before any transfer or sale can occur.

Implications For Policy And Enforcement

Based on reports, this disclosure highlights practical issues for authorities handling crypto. Keeping digital coins secure, establishing chain-of-custody records, calculating market value for legal decisions, and managing potential auctions are all new operational tasks for judicial agencies.

Transparency demands have increased as lawmakers press for clearer rules about how seized crypto should be treated.

Market watchers and legal experts say the public accounting of seized crypto may spur debate in Taiwan about regulations and asset management. Some will argue for clearer rules on disposition.

Others will push for victim compensation procedures that account for volatile values. Whatever comes next, these tokens are currently pieces of evidence tied to court rulings rather than line items in a sovereign treasury.

Featured image from Unsplash, chart from TradingView

Bitcoin’s options market has a new obsession: Christmas week. In a post Thursday, energy-sector managing partner David Eng argued the next eight days (December 19 through December 26) could define the near-term cycle for BTC, not because of a macro headline or some sudden ETF stampede, but because a large chunk of dealer gamma exposure is scheduled to roll off the board in two shots.

At press time, bitcoin traded around $86,928, after swinging between roughly $84,461 and $89,230 intraday. Eng’s framing is blunt and very “options people”: the market is being mechanically pinned, and the pin has an expiry date

The Hidden Force Holding Back Bitcoin Price?

“The narrative isn’t just about tomorrow. We are staring down the barrel of a ‘Double-Barreled’ Liquidity Event that will wipe 67% of the entire derivatives board clean by December 26th,” Eng wrote. “Bitcoin is trading at $88,752, deep in the -25% Value Zone (Trend Value: $118k). The spring is coiled, but two massive structural weights are holding the lid down.”

Those “weights,” in his telling, are two expiries with meaningful gamma attached: roughly $128 million tied to Dec. 19 (21% of the total he tracks) and another $287 million at Dec. 26, which he calls the “boss level” ceiling. He labels the combined $415 million a coming “Gamma Flush,” arguing that once it clears, the hedging drag that’s been compressing spot price action should ease.

The practical point is less mystical than it sounds. If dealers are sitting on meaningful gamma around a tight cluster of strikes, their delta-hedging can dampen volatility and keep spot gravitating around certain levels until that exposure decays or expires — the kind of “why does this tape feel glued?” frustration traders know too well.

Eng’s map is built around very specific lines in the sand: $85k–$90k as the “mud” zone where hedging pressure keeps snapping price back, and $90,616 as the flip level he’s watching around the Dec. 19 expiry.

“Stage 1: The Spark (Tomorrow, Dec 19) — $128 Million in Gamma expires tomorrow (21% of total). This is the ‘Appetizer.’ It removes the immediate suppression pinning us below $90k,” he wrote. “Watch the $90,616 flip level. If we clear this, the intraday shackles fall off.”

But Eng is clearly more focused on the week after. “Stage 2: The Floodgate (Next Friday, Dec 26) — $287 Million in Gamma expires next week,” he continued. “A staggering 46.2% of all dealer gamma exposure sits on this single date… Dealers have a quarter-billion-dollar incentive to keep volatility crushed and price pinned near $85k-$90k through Christmas to harvest this premium.”

The claim, basically: pre-Dec. 26 is “thick mud,” post-Dec. 26 is the tape suddenly breathing again. “When you combine these two dates, $415,000,000 of gamma — two-thirds of the entire market structure — evaporates in the next 8 days,” Eng wrote. “Before Dec 26: The market is fighting through thick mud… After Dec 26: The mud dries up. The suppression mechanism is gone. The Power Law gravity ($118k) takes over without the dealer counter-flow.”

He also tossed out a provocative ratio that’s been circulating in derivatives circles all year: dealer mechanics versus ETF demand. “Dealer Gamma forces are currently ~13x stronger than ETF Flows,” he wrote. “Dealer ~$507.6M, ETF ~$38M. This is why the market is obeying the technical gamma levels ($85k/$90k) and ignoring the ETF volume.”

Dealer Gamma forces are currently ~13x stronger than ETF Flows

Dealer ~$507.6M ETF ~$38M

This is why the market is obeying the technical gamma levels ($85k/$90k) and ignoring the ETF volume.

— David (@david_eng_mba) December 18, 2025

And when critics in the replies questioned whether “$287M” is even meaningful, Eng clarified what the figure is — and what it isn’t. “The $287M figure refers to dealer gamma exposure (GEX), not total options size,” he wrote. “GEX measures how much spot Bitcoin dealers may need to buy or sell to stay delta-neutral as price moves. It reflects hedging pressure, not notional value.”

So the tradeable implication of Eng’s thesis is straightforward: expect the pinning games into Christmas, then watch whether a post-expiry regime shift actually shows up in realized volatility — and in price’s ability to stop bouncing off the same levels like it’s hitting invisible glass.

At press time, Bitcoin traded at $87,953.

• The proposed ETF would use Coinbase Custody and include staking and in-kind transactions.
• Several asset managers are now competing to bring SUI-based ETFs to the US market.
• Regulatory changes under the current SEC leadership are accelerating altcoin ETF activity.

Crypto asset manager Bitwise has formally filed a Form S-1 with the US Securities and Exchange Commission, seeking approval to launch a spot exchange-traded fund linked to SUI.

The proposal adds fresh momentum to the fast-expanding crypto ETF landscape, where issuers are increasingly targeting altcoins beyond Bitcoin and Ethereum.

Rather than focusing on short-term market moves, the filing highlights how fund structures, custody choices, and regulatory positioning are evolving as competition intensifies.

With multiple firms now pursuing similar products, SUI is quickly becoming a key test case for the next phase of crypto ETFs in the US.

The proposed product, named the Bitwise SUI ETF, is designed to track the spot price of SUI, the native token of the Sui Network.

If approved, it would give investors direct exposure to SUI without requiring them to hold the asset themselves, reflecting growing institutional interest in simplified crypto access.

How Bitwise is structuring the ETF

The filing shows that Coinbase Custody has been selected as the custodian for the fund, underlining a continued reliance on established US-based crypto infrastructure.

Bitwise has not yet revealed the ETF’s ticker symbol or intended listing exchange, but the structure clearly focuses on holding spot SUI rather than futures or other derivatives.

One notable element of the proposal is the inclusion of staking. The ETF would be able to stake its SUI holdings, allowing it to earn additional tokens over time.

This approach could potentially enhance returns compared with products that only hold assets passively, although it also introduces additional operational considerations.

The filing also details in-kind creations and redemptions.

This means authorised participants would be able to exchange SUI tokens directly for ETF shares and vice versa, instead of using cash.

This structure is increasingly favoured by issuers as it can improve efficiency and reduce tracking error.

Rising competition around SUI products

Bitwise is not alone in targeting SUI.

Grayscale, 21Shares, and Canary Capital have already submitted filings for similar spot SUI ETFs, signalling a crowded field forming around the asset.

The growing interest follows recent regulatory developments, including the SEC’s approval of a 2x leveraged SUI ETF from 21Shares.

Although no spot SUI ETF has yet launched in the US, these filings suggest that issuers see a clearer regulatory path emerging.

SUI itself launched in 2023 and has climbed into the top tier of digital assets by market capitalisation, currently ranked 31st with a value of about $5 billion.

Bitwise has also integrated SUI into its 10 Crypto Index ETF, reinforcing the firm’s broader commitment to the network.

Market response and regulatory context

SUI’s market price showed little immediate reaction to the filing, trading near $1.40 and remaining more than 12% lower over the past week.

Market participants generally view ETF filings as longer-term signals rather than short-term price drivers.

The timing of the application is significant. Under SEC Chair Paul Atkins, the regulator has moved toward clearer and more standardised ETF listing frameworks.

This shift has already helped products linked to assets such as XRP, DOGE, and SOL advance through the approval process.

As more issuers push forward with altcoin ETFs, SUI’s progress may offer early insight into how far and how fast the US crypto ETF market can broaden.

The post Bitwise files for spot SUI ETF as competition intensifies in crypto fund market appeared first on CoinJournal.

An app to fix your posture, gaze, stress, and water intake – in the most minimalist way possible? That's what Loook is all about.

The post I found a Mac app to take care of my health, and it’s a godsend for all desk warriors appeared first on Digital Trends.

• Michael Selig is confirmed as CFTC chair, ending a long interim period at the US derivatives regulator.
• Selig signals a narrower enforcement focus as Congress weighs expanding the CFTC’s crypto authority.
• Leadership change comes as debate intensifies over digital assets and US market structure rules.

After nearly a year of temporary leadership, Michael Selig was confirmed by the US Senate on December 18 and will soon be sworn in as the 15th chairman of the Commodity Futures Trading Commission

His appointment brings an end to an extended interim period at the derivatives market regulator and places a familiar figure back at the centre of US market oversight.

Selig’s confirmation comes as policymakers and market participants closely track how the CFTC will position itself amid ongoing debates over digital assets, market structure, and regulatory coordination.

With Congress weighing legislation that could significantly expand the agency’s authority, the timing of the leadership change is drawing heightened attention across traditional and crypto markets.

Return to a familiar regulator

Selig’s professional ties to the CFTC run deep.

He first joined the agency in 2014, serving as a law clerk to then-Commissioner Christopher Giancarlo, who later became chairman.

After leaving the agency, Selig moved into private practice, where he advised trading firms, exchanges, and digital asset companies on compliance with US securities and commodities laws.

Earlier this year, Selig returned to government service as chief counsel to the Securities and Exchange Commission’s Crypto Task Force.

In that role, he acted as a senior advisor to Chairman Paul Atkins and was involved in inter-agency discussions on supervising digital asset markets, placing him at the intersection of securities and commodities regulation.

Leadership transition at the CFTC

Selig will succeed Caroline Pham, who has served as acting chair for much of 2025.

For several months, Pham was also the CFTC’s only Senate-confirmed commissioner, a situation that underscored the agency’s leadership vacuum during a period of regulatory change.

Under Pham’s tenure, the CFTC continued to operate but with limited long-term direction, as major policy decisions awaited permanent leadership.

Selig’s confirmation restores a Senate-backed chair at a moment when the commission’s mandate could soon broaden.

Enforcement direction and priorities

During his confirmation hearing, Selig signalled support for a more targeted enforcement strategy.

He argued that focusing on minor technical violations can consume agency resources and encourage legitimate firms to move operations offshore, without materially improving market integrity.

At the same time, he emphasised that the CFTC must remain active in pursuing fraud, manipulation, and abusive conduct.

His stated approach aligns closely with policies advanced under Pham, where enforcement efforts were narrowed to prioritise complex fraud cases and retail harm rather than paperwork-based violations.

Over the past year, the CFTC also revised its investigation procedures to provide firms with greater transparency and additional time during enforcement processes, reflecting a shift in regulatory tone.

Crypto oversight and legislative backdrop

On digital assets, Selig is expected to continue efforts to bring crypto-related activity into regulated US markets.

The CFTC has already launched pilot initiatives covering tokenised collateral and listed spot crypto products on regulated exchanges.

Selig has previously supported clearer market structure rules and stronger coordination with the SEC, the Treasury Department, and banking regulators.

His confirmation coincides with congressional debate over bills that could grant the CFTC primary oversight of spot crypto commodity markets, potentially expanding the agency’s role at a critical stage in crypto regulation.

With a full agenda and limited transition time, Selig’s early decisions will be closely watched across financial markets.

The post Michael Selig confirmed as CFTC chair, ending interim leadership period appeared first on CoinJournal.

On-chain data shows the distribution of the underwater Bitcoin supply has been shifting recently with the share of long-term holders rising.

23.7% Of Bitcoin Supply Is Currently Being Held At A Loss

In its latest weekly report, on-chain analytics firm Glassnode has discussed about the latest trend in the Bitcoin Total Supply in Loss. This metric measures, as its name suggests, the total amount of the cryptocurrency’s supply that’s currently carrying a net unrealized loss.

The indicator works by going through the transaction history of each token in circulation to see what price it was last moved at. If this previous transaction price was lower than the latest spot price for any token, then that particular coin is assumed to be underwater right now.

The Total Supply in Loss adds up all coins of this type to produce a net situation for the network. A counterpart metric called the Total Supply in Profit accounts for the tokens of the opposite type.

Now, here is the chart shared by the analytics firm that shows the trend in the 7-day moving average (MA) of the Total Supply in Loss over the last few years:

As displayed in the above graph, the Bitcoin Total Supply in Loss witnessed a sharp surge as the asset’s price crashed in November. Since then, the metric has stayed inside the 6 to 7 million BTC range, with its current value being 6.7 million BTC. This phase corresponds to the highest degree of loss on the network since 2023.

Glassnode explained:

Persisting within the 6–7 million BTC range since mid-November, this pattern closely mirrors early transitional phases of prior cycles, where mounting investor frustration preceded a shift toward more pronounced bearish conditions and intensified capitulation at lower prices.

The report has also shed light on how this loss supply is distributed between the two main divisions of the Bitcoin investors based on holding time: short-term holders (STHs) and long-term holders (LTHs). The cutoff between the two groups is 155 days, with investors who purchased inside this window falling in the STHs and those with a longer holding time in LTHs.

As the below chart shows, the Bitcoin loss supply spike last month was initially dominated by STHs.

With the cryptocurrency ranging low since then, the distribution of the loss supply has seen a shift between the two cohorts: LTHs have gained some notable share.

Of the 23.7% Bitcoin supply in circulation that’s underwater right now, 13.5% is held by STHs and 10.2% by LTHs. “This distribution suggests that, much like in prior cycle transitions into deeper bearish regimes, loss-bearing supply accumulated by recent buyers is gradually maturing into the long-term holder cohort,” noted the analytics firm.

BTC Price

At the time of writing, Bitcoin is trading around $85,400, down more than 5.5% over the last week.

In its latest effort to provide clearer regulatory clarity, the US Securities and Exchange Commission (SEC) has published detailed guidelines for broker-dealers on the custody of crypto assets.

SEC Clarifies Crypto Custody Standards For Broker-Dealers

On Wednesday, the SEC’s staff of the Division of Trading and Markets issued a statement addressed its views on the application of paragraph (b)(1) of Rule 15c3-3 to crypto assets that are considered securities, including tokenized versions of an equity or debt security.

Under Securities Exchange Act of 1934, Rule 15c3-3 requires any broker-dealer to “promptly obtain and thereafter maintain physical possession or control of all fully paid and excess margin securities it carries for the account of customers.”

The new guidelines clarify how “any broker-dealer that carries crypto asset securities for customers, including broker-dealers that conduct a traditional securities business” can maintain compliance with this rule despite tokens being on the blockchain.

According to the SEC’s statement, a broker-dealer can consider itself to have “physical possession” of the crypto assets if it has direct access to the asset and the capability to transfer it on the associated distributed ledger technology (DLT).

Broker-dealers must also conduct and document an throughout assessment “of the distributed ledger technology and the associated network where transfers of ownership of a crypto asset security are recorded prior to undertaking to maintain possession of the crypto asset security, and at reasonable intervals thereafter.”

In additions, they must establish, maintain, and enforce “reasonably designed written policies and procedures” to ensure the assets’ security, the protection of private keys, they have adequate plans to address unexpected disruptions to its possession of the crypto assets, including theft, unauthorized used, network attacks, and hard forks.

This circumstance emphasizes that a broker-dealer has policies, procedures, and controls reasonably designed to help ensure that no other person, including the broker-dealer’s customer or a third-party (including the broker-dealer’s affiliate), has access to the relevant private keys and the ability to transfer the asset without the authorization of the broker-dealer.

Meanwhile, the agency explained that “a broker-dealer does not deem itself to possess a crypto asset security if the broker-dealer is aware of any material security or operational problems or weaknesses with the distributed ledger technology and associated network used to access and transfer the crypto asset security or is aware of other material risks posed to the broker-dealer’s business by custodying the crypto asset security.”

SEC’s Path To Clearer Rules

The SEC affirmed that the statement is part of its efforts to provide greater clarity on the application of federal securities laws to crypto assets. Notably, the regulatory agency recently published guidelines to help educate retail investors about the ways they can hold crypto assets and is pushing to modernize its rules to facilitate an positive market environment.

Earlier this month, the US regulator revealed it is evaluating tokenization to modernize the issuance, trading, and settlement of public equities. SEC chairman Paul Atkins asserted that “Distributed ledger technology and the tokenization of financial assets, including securities, have the potential to transform our capital markets.”

Moreover, Atkins recently stated that the Commission could issue innovation exemption rules for crypto firms in early 2026.  The agency has been considering the rule exemption since July to “permit novel ways of trading and more narrowly tailored forms of relief to facilitate the building of other components of a tokenized securities ecosystem.”

The change would allow crypto firms to quickly launch products without having to comply with “burdensome prescriptive regulatory requirements that hinder productive economic activity.” Instead, they would “be able to comply with certain principles-based conditions designed to achieve the core policy aims of the federal securities laws.”

Coinbase has filed lawsuits against the US states of Michigan, Illinois, and Connecticut, escalating a growing legal fight over who has the authority to regulate prediction markets in the United States.

According to a Bloomberg report, Coinbase said the three states have either taken action or threatened to act against prediction market operators, despite lacking the legal authority to do so.

The exchange said it is seeking court orders to affirm that prediction markets fall under the exclusive jurisdiction of the Commodity Futures Trading Commission (CFTC), not state gaming regulators.

Coinbase Lawsuit Follows Kalshi Deal Ahead of 2026 Prediction Market Launch

The lawsuits come one day after Coinbase announced plans to offer event-based contract trading through a partnership with Kalshi, a CFTC-regulated prediction markets platform.

According to court filings, Coinbase plans to roll out prediction market access to U.S. customers starting in January 2026, including in Illinois.

Coinbase Chief Legal Officer Paul Grewal said the cases are meant to clarify a point the company views as settled law.

“Prediction markets fall squarely under the jurisdiction of the CFTC, not any individual state gaming regulator,” Grewal said in a post on X.

He argued that state-level efforts to block or control these markets undermine innovation and conflict with federal law.

Some states think prediction markets fall outside the CFTC’s jurisdiction when they relate to sports. But Congress deliberately chose to exclude only a handful of specific underliers—including “onions” and “motion picture box office receipts”—from the definition of “commodity.”…

— paulgrewal.eth (@iampaulgrewal) December 19, 2025

In its Illinois filing, Coinbase warned that state interference could cause “immediate and irreparable” harm to its business.

The company is seeking both declaratory and injunctive relief to prevent enforcement actions while the courts weigh the issue.

At the center of the dispute is whether prediction markets, particularly those tied to sports outcomes, should be treated as gambling.

Several states have argued that event-based contracts resemble unlicensed sports betting, placing them under state jurisdiction.

Coinbase disputes that framing, saying prediction markets operate as neutral exchanges that match buyers and sellers rather than setting odds for profit.

Grewal also pointed to Congress’s definition of commodities, noting that lawmakers excluded only a narrow list of items from CFTC oversight, such as onions and box office receipts.

By that logic, he said, sports-related event contracts remain within the agency’s remit.

Connecticut Targets Kalshi and Robinhood

The lawsuits follow recent enforcement actions by Connecticut regulators, who earlier this month issued cease-and-desist orders to Kalshi, Robinhood and Crypto.com.

Kalshi challenged the move in court and won temporary relief after a federal judge paused state enforcement while the case proceeds.

As reported, crypto exchanges and platforms are accelerating their push into prediction markets, with Gemini and PancakeSwap emerging as the latest players to roll out new offerings.

Rivals such as Coinbase and Crypto.com have also been exploring similar expansions as competition intensifies.

The post Coinbase Sues Michigan, Illinois, and Connecticut Over Prediction Market Regulation appeared first on Cryptonews.

We’ve often said that some technological advancements seemed like alien technology for their time. Sometimes we look back and think something would be easy until we realize they didn’t have the tools we have today. One of the biggest examples of this is how, in the 1950s, engineers created a color image that still plays on a black-and-white set, with the color sets also able to receive the old signals. [Electromagnetic Videos] tells the tale. The video below simulates various video artifacts, so you not only learn about the details of NTSC video, but also see some of the discussed effects in real time.

Creating a black-and-white signal was already a big deal, with the video and sync presented in an analog AM signal with the sound superimposed with FM. People had demonstrated color earlier, but it wasn’t practical for several reasons. Sending, for example, separate red, blue, and green signals would require wider channels and more complex receivers, and would be incompatible with older sets.

The trick, at least for the NTSC standard, was to add a roughly 3.58 MHz sine wave and use its phase to identify color. The amplitude of the sine wave gave the color’s brightness. The video explains why it is not exactly 3.58 MHz but 3.579545 MHz. This made it nearly invisible on older TVs, and new black-and-white sets incorporate a trap to filter that frequency out anyway. So you can identify any color by providing a phase angle and amplitude.

The final part of the puzzle is to filter the color signal, which makes it appear fuzzy, while retaining the sharp black-and-white image that your eye processes as a perfectly good image. If you can make the black-and-white signal line up with the color signal, you get a nice image. In older sets, this was done with a short delay line, although newer TVs used comb filters. Some TV systems, like PAL, relied on longer delays and had correspondingly beefier delay lines.

There are plenty of more details. Watch the video. We love how, back then, engineers worried about backward compatibility. Like stereo records, for example. Even though NTSC (sometimes jokingly called “never twice the same color”) has been dead for a while, we still like to look back at it.