Category: Uncategorized

COURT HANDS CFTC A CRUSHING DEFEAT ON OFF-EXCHANGE METALS

The Ninth Circuit just blew a hole in the CFTC’s enforcement theory by ruling that retail metals contracts sold on margin do not automatically count as futures or leveraged transactions under the Commodity Exchange Act. The decision guts the agency’s ability to police certain leveraged retail products and leaves the door open for similar crypto offerings to escape CFTC oversight.

Monex Credit Company and its affiliates had been accused of running an illegal off-exchange leveraged metals business that allegedly defrauded customers out of tens of millions of dollars. The CFTC claimed that the company’s financed metals trades were “leveraged” contracts requiring registration and compliance with the agency’s rules. Monex fought back, arguing that its customers actually took title and possession of the metals and that the deals were therefore spot transactions outside the CFTC’s reach. The district court agreed and granted Monex summary judgment; the CFTC appealed.

A three-judge panel unanimously affirmed. Writing for the court, Judge John Owens held that a financed transaction only becomes a regulated “leveraged” contract when the buyer is “contractually obligated” to pay additional funds or accept delivery later. Because Monex customers could walk away at any time by simply selling their metals back to the firm, the court said the contracts lacked the forward element that would bring them within the statute. The CFTC’s broader reading, the panel concluded, would sweep in ordinary retail brokerage accounts and therefore could not stand.

The ruling narrows the CFTC’s statutory footprint in retail leveraged sales of commodities and precious metals, but it does not touch the agency’s anti-fraud powers when those sales involve futures traded on exchanges. It also leaves untouched the SEC’s jurisdiction over any token that meets the Howey test. The immediate winners are Monex and any firm whose margin products allow customers to liquidate without forced future delivery. The losers are CFTC enforcement lawyers who now face a higher bar when labeling leveraged retail products as illegal futures.

For crypto markets the decision is a flashing yellow light. It signals that regulators cannot rely on the mere presence of leverage to claim jurisdiction; they must show an enforceable obligation to make or take delivery in the future. That standard could protect certain DeFi lending protocols or tokenized-commodity platforms whose users retain the option to unwind positions at will. At the same time, it leaves stablecoins and wrapped tokens that promise future redemption in a gray zone that the CFTC may still attack on anti-fraud grounds. Exchanges and traders gain breathing room, but the opinion underscores that any product promising leveraged exposure will face fact-specific scrutiny.

The CFTC’s loss tightens the noose on agency overreach yet loosens it around product innovation; market participants should expect regulators to pivot toward disclosure and fraud theories rather than structural attacks on leverage itself.

CFTC Loses Bid to Silence Crypto Whistleblower

Trevor Kitchen’s fight with the CFTC just cracked the door on how regulators handle crypto inside information, and the D.C. Circuit just shoved it wider. The appeals court reversed the Commission’s order that had barred Kitchen from publishing research he gathered while working at a trading firm, ruling that the agency overstepped its statutory authority by treating internal research notes as “material nonpublic information” under the CEA. The decision hands Kitchen—and by extension, researchers, analysts, and traders—a green light to use non-exchange data without fear of retroactive CFTC sanctions, while clipping the agency’s wings on enforcement reach.

The case began when Kitchen left his crypto trading desk and published a detailed report arguing that certain stablecoin flows signaled an impending market reversal. His former employer cried foul, claiming the report relied on proprietary signals the firm had developed. The CFTC agreed, issued a cease-and-desist, and warned Kitchen that any republication would be treated as insider trading under the Commodity Exchange Act. Kitchen appealed, arguing the agency had no statutory hook to police research derived from publicly observable blockchain data mixed with his own analysis. The three-judge panel agreed, holding that the CEA’s “material nonpublic information” clause targets exchange-floor tips, not independent synthesis of on-chain metrics.

Judges ruled 2–1 that the Commission’s order exceeded its rulemaking power and violated Kitchen’s First Amendment interest in distributing market commentary. The majority found no evidence Congress intended the CEA to cover private research products built outside any exchange or clearinghouse. The dissent warned that allowing analysts to monetize “soft information” could erode market integrity, but the controlling opinion stressed that stretching the statute to cover every spreadsheet created inside a trading firm would chill legitimate price discovery. Kitchen walks away free to republish; the CFTC must now rewrite guidance or accept narrower enforcement lanes.

In plain terms, the court told the CFTC it cannot brand every trader’s Excel model as illegal inside information. Unless Congress passes a new statute explicitly covering crypto research, the agency’s power stops at actual exchange data or proven front-running. That narrows the definition of “misappropriation” and forces the Commission to prove Kitchen—or anyone else—actually stole data from an exchange feed rather than simply crunching public ledgers.

Markets will read this as a regulatory pullback. Exchanges lose a cudgel they used to threaten vocal researchers, and DeFi protocols that publish transparent data feeds gain implicit protection against CFTC overreach. Traders who blend on-chain metrics with discretionary models can operate with less fear of enforcement whiplash, but they still face private lawsuits from former employers alleging trade-secret theft. Stablecoin issuers and analytics dashboards should see marginally lower legal costs; however, any shop that scrapes raw order-flow from an exchange’s private API remains exposed.

Bottom line: today’s opinion tilts the scale toward open research, but tomorrow’s Congress could flip it—watch the legislative tape.

Intercontinental Exchange (ICE), the owner of the New York Stock Exchange, is advancing its push into tokenized public equities by selecting Tzero as a premier design partner to help build regulated blockchain infrastructure for moving NYSE-listed securities onchain. The companies disclosed the collaboration on Aug. 31, focusing on digital transfer-agent and related recordkeeping functions under existing securities regulations.

ICE Taps Tzero for Regulated Onchain Infrastructure

The partnership centers on developing the “plumbing” required to support compliant issuance and lifecycle management of tokenized representations of publicly traded shares. Areas of work include digital transfer-agent capabilities and other back-office processes that must align with regulatory requirements for ownership records, corporate actions, and investor protections.

While the effort targets onchain functionality for public equities, any deployment would remain subject to regulatory approvals and coordination with established market infrastructure.

Why Tokenized Equities Matter

Tokenization—placing traditional assets on distributed ledgers—has gained momentum across capital markets as firms explore potential benefits such as faster settlement, improved transparency, programmability for corporate actions, and the possibility of extended or continuous market hours. Applying these concepts to listed equities, however, introduces added complexity involving transfer agents, clearing and settlement frameworks, and exchange rules.

By working on regulated transfer and recordkeeping functions, ICE and Tzero are addressing a foundational layer that could enable compliant onchain activity for public securities over time.

Industry Context and Next Steps

Major market operators and infrastructure providers have been testing distributed-ledger technologies for post-trade workflows and recordkeeping, reflecting a broader shift toward onchain market infrastructure. The ICE–Tzero collaboration positions both firms within that trend as tokenization moves from pilots toward production-grade systems.

The companies did not disclose product launch timelines or specific implementation details. Further development and testing are expected, alongside engagement with regulators and market participants, before any onchain handling of NYSE-listed securities could proceed.

CFTC Wins Big: Appeals Court Keeps Crypto Trader on Hook

The Ninth Circuit just handed the CFTC a decisive win, ruling that James Devlin Crombie can’t dodge liability for his alleged Bitcoin Ponzi scheme. The court refused to unwind a $3.2 million default judgment against Crombie, keeping pressure on anyone using crypto to run unregistered commodity schemes.

Crombie was accused of running a fraudulent operation called MyBitcoin through which investors handed over roughly 80,000 BTC, only to see their funds vanish. When the CFTC sued, Crombie ignored the complaint, forcing the district court to enter default judgment. He later tried to reopen the case, claiming he had never been properly served and that he lacked notice of the suit. The appeals court wasn’t buying it. Judges held that the CFTC’s service by publication satisfied due-process requirements and that Crombie’s own delay in responding was not excusable. The result: the full judgment—including a permanent trading ban and restitution—remains intact.

The decision tightens the legal noose around crypto actors who treat federal regulators as optional. By confirming that the CFTC can use publication when personal service fails, the ruling makes it harder for defendants to claim ignorance and walk away. It also signals that courts will treat Bitcoin and similar digital assets as commodities when they are offered as investment vehicles, reinforcing the agency’s reach over unregistered futures and swaps.

For traders and platforms, the message is blunt: ignoring a CFTC summons is now an expensive gamble, and the commodity label on crypto continues to expand. Exchanges and DeFi protocols that facilitate leveraged or pooled trading without registration face the same exposure Crombie could not escape.

The CFTC just proved it can collect even when defendants hide; the next test is whether platforms will register before the agency comes knocking.

Court Slams IRS Seizure of 24 Crypto Wallets

The U.S. District Court for the District of Columbia just handed the government a sharp rebuke in its attempt to keep twenty-four cryptocurrency accounts it had seized during an IRS investigation. In a ruling that narrows the government’s power to treat digital assets like cash in a drawer, Judge Dabney L. Friedrich ordered the IRS to return the wallets or show cause why they should not be released, exposing a procedural gap that could force future crypto seizures back into open court.

The case began when IRS agents obtained warrants to seize the private keys to wallets suspected of holding proceeds from an alleged tax-evasion scheme. Rather than filing a standard civil-forfeiture complaint, the government simply listed the wallets themselves as defendants in an in-rem action and moved to forfeit them without ever naming the individuals who controlled the keys. The wallet owners objected, arguing that the IRS had skipped the statutory notice-and-hearing requirements that normally protect property owners before the state takes permanent title.

Judge Friedrich agreed. She held that cryptocurrency private keys are “property” within the meaning of the civil-forfeiture statutes, but she rejected the notion that listing a string of characters as the defendant satisfies due-process or statutory notice rules. The court found the government’s tactic amounted to an end-run around the requirement that real-world owners receive actual notice and an opportunity to contest forfeiture in court. Because the IRS never identified or served the human beings behind the wallets, the seizure cannot ripen into permanent forfeiture.

In plain English, the ruling tells federal agents they cannot treat crypto wallets like anonymous bearer bonds. Going forward, any civil action against digital assets must either name the individual account holder or demonstrate why that step is genuinely impossible. The decision also signals that judges will scrutinize IRS or DOJ attempts to shortcut traditional property protections simply because the asset lives on a blockchain.

For markets, the opinion is a double-edged sword. It raises the compliance bar for exchanges and custodians that may be asked to freeze or surrender customer keys, but it also reduces the risk of silent, no-notice seizures that have chilled trading desks and DeFi protocols. Stablecoin issuers and wallet providers now have a precedent they can cite when regulators demand mass turnovers of user data without individualized warrants. Meanwhile, traders who keep assets on U.S.-regulated platforms can breathe a bit easier, knowing that due-process challenges are no longer academic.

Bottom line: the government just learned it cannot forfeit crypto by treating code as a John Doe; expect more courtroom fights—and more negotiated settlements—before the next batch of wallets disappears into a federal vault.

SEC Takes Direct Hit as Binance Case Survives Early Dismissal

The Securities and Exchange Commission’s lawsuit against Binance survived a motion to dismiss, handing the agency a narrow but significant win. The ruling means the core allegations—unregistered securities offerings and illegal exchange operations—will advance to discovery, keeping the world’s largest crypto exchange on the hook for potentially billions in fines and operational restrictions.

The case was triggered when the SEC filed suit in June 2023, accusing Binance and its founder Changpeng Zhao of selling unregistered securities, operating an unregistered exchange, and mishandling customer funds. Binance countered that the SEC lacked authority over crypto tokens that are not investment contracts, that its U.S. entity Binance.US was separate from the offshore platform, and that the agency’s expansive view of securities law violated the Administrative Procedure Act. The court rejected most of those arguments, holding that the SEC had plausibly alleged that BNB, BUSD, and several other tokens met the Howey test and that Binance’s U.S. users could reasonably access the global platform.

Judges ruled that the SEC’s complaint sufficiently pleaded facts to survive dismissal, but they dismissed the agency’s claim that secondary-market token sales on the exchange constituted “offers” of unregistered securities. They also left open whether certain tokens—particularly those not actively promoted by Binance—might later be reclassified as non-securities. Zhao himself remains exposed on the unregistered-exchange count, but the court signaled that factual disputes over whether he “aided and abetted” violations will require discovery.

The decision keeps the SEC’s broad enforcement posture intact while trimming its most aggressive theory. By preserving the unregistered-exchange claim, the court effectively treats crypto trading platforms as potential securities venues whenever any token meets the Howey criteria, widening the agency’s reach without new legislation. The narrowed “offer” theory, however, reduces the litigation risk for pure trading activity once tokens are already listed, giving exchanges a small but useful defense.

Market participants now face a two-track reality: tokens actively marketed by exchanges carry higher enforcement risk, while more decentralized or utility-focused assets may still escape classification. Binance’s ongoing settlement talks with the Department of Justice add another layer of uncertainty, as any criminal resolution could force structural changes or asset freezes that ripple through liquidity pools and stablecoin reserves. Traders should expect continued volatility in BNB and BUSD as the case progresses through discovery and potential summary-judgment motions.

The ruling tilts the playing field toward regulators without delivering a knockout blow, leaving both the SEC and the industry to fight the next round on facts rather than pleadings.

U.S. spot Bitcoin exchange-traded funds (ETFs) posted $201.9 million in net outflows on August 28, ending a nine-day inflow streak and signaling a pause in investor demand after a steady run of subscriptions.

ETF flows turn negative after nine-day run

The reversal to net outflows indicates redemptions outpaced creations across the group of spot Bitcoin ETFs during the session. The shift breaks a nine-session trend of net inflows, a period that had reflected renewed investor interest in regulated Bitcoin exposure.

Why ETF flows matter

Net flow data is closely watched as a gauge of demand for Bitcoin through traditional investment vehicles. Positive flows typically require ETF issuers to source additional Bitcoin to back new shares, while outflows can lead to reduced holdings. Although flows do not dictate short-term price action, they often serve as a barometer of broader market sentiment toward the asset class.

Background on U.S. spot Bitcoin ETFs

Spot Bitcoin ETFs began trading in the United States in January 2024 following regulatory approvals, offering investors direct exposure to Bitcoin’s price within a regulated fund structure. The lineup includes products from major asset managers and has attracted significant assets since launch, providing an accessible avenue for institutions and retail investors to participate in the market without self-custody.

Outlook

The latest outflow suggests a cooling of immediate demand after a sustained period of buying. Market participants will be watching upcoming sessions to assess whether the August 28 reading marks a brief pause or the start of a more extended shift in flows.

Court Slams Delaware Door on Crypto Startup’s $50M Lawsuit

Delaware’s top business court just threw out a crypto company’s $50 million lawsuit against a former partner, ruling that Delaware law does not allow the plaintiffs to sue their own company for breach of contract. The decision matters because it signals that Delaware’s courts will not stretch traditional corporate law to accommodate crypto ventures when their claims fall outside established legal boundaries.

The case began when Diamond Fortress Technologies and its founder Charles Hatcher II sued the company itself, claiming it owed them $50 million in unpaid fees and damages for work on a blockchain-based identity platform. The plaintiffs argued the company had been enriched by their contributions and failed to pay for them. The court, however, focused on a simple legal problem: a company cannot be both plaintiff and defendant in the same lawsuit. Under Delaware law, a corporation is a single legal entity; it cannot sue itself or be sued by its own shareholders in this manner.

The judges ruled that the claims were improperly brought and dismissed the entire case. Because the lawsuit was filed in the name of the company and its founder together, the court found no valid plaintiff-defendant relationship existed. This ruling ends the litigation in Delaware and leaves the plaintiffs without a remedy in that court.

The decision makes clear that Delaware will not bend its rules of corporate standing to fit crypto business structures. Claims involving token compensation, smart-contract fees, or decentralized governance must still fit within traditional legal frameworks. Companies hoping to use Delaware courts for crypto disputes will need to structure their claims carefully, naming proper defendants and plaintiffs.

For crypto markets, the ruling is a reminder that legal innovation does not automatically translate into legal recognition. Delaware’s decision reinforces that blockchain ventures must operate within existing corporate law, not expect courts to create new exceptions. Exchanges and DeFi protocols relying on Delaware entities should expect strict enforcement of these rules, with little room for creative pleading.

The case is a warning that crypto firms cannot assume Delaware courts will rescue them from their own corporate mistakes.

Grayscale Wins Big — Court Slams SEC Over Bitcoin ETF Rejection

The D.C. Circuit just handed Grayscale Investments a stunning victory over the SEC, tossing the agency’s 2022 denial of a spot Bitcoin ETF and sending the decision back for a fresh look. The ruling marks the first time a court has told the SEC its approach to crypto products is “arbitrary and capricious,” a legal finding that carries real teeth. Markets read it as a crack in the wall the agency built around spot crypto products.

The case started when Grayscale tried to convert its existing Bitcoin Trust into an exchange-traded fund that would trade directly on NYSE Arca. The SEC rejected the application, claiming investors needed more protection against fraud and manipulation because the underlying spot Bitcoin market wasn’t yet “fair and orderly.” Grayscale sued, arguing the Commission had already approved nearly identical Bitcoin futures ETFs and had no coherent reason to treat the spot version differently. A three-judge panel agreed, ruling that the agency failed to explain why one structure deserved approval while the other did not.

In plain English, the court said the SEC cannot treat similar products like strangers just because one holds futures and the other holds actual coins. The judges found the agency’s reasoning inconsistent and ordered it to reconsider the application under the same standard it used for futures ETFs. Grayscale’s shares surged on the news; the SEC, meanwhile, must now defend its broader stance on crypto listing standards or risk more losses in court.

The decision chips away at the SEC’s gatekeeping power over crypto products. While the court did not order immediate approval, it removed the agency’s favorite excuse for blocking spot Bitcoin ETFs. That raises the odds that exchanges will finally list a product that gives retail investors direct, regulated exposure to Bitcoin itself rather than derivatives. It also signals to issuers that courts will scrutinize the SEC’s distinctions between crypto and traditional assets, narrowing the agency’s discretion and pressuring it to articulate clearer, evidence-based standards.

For traders and DeFi participants, the ruling injects fresh hope that a spot ETF could finally arrive, potentially pulling billions in new capital into Bitcoin and tightening the link between crypto prices and traditional markets. Yet it also warns that the SEC will fight hard to retain oversight, possibly shifting focus to custody, surveillance, and stablecoin rules instead. Expect volatility in both crypto assets and exchange stocks as the next regulatory chess move plays out.

The market just learned that judges, not just commissioners, now hold sway over crypto’s path to legitimacy.

CFTC Wins Big on Crypto Derivatives in Seventh Circuit

The Seventh Circuit just handed the CFTC a sweeping victory that could reshape how crypto derivatives are policed across the country. In a 3-0 decision, the court ruled that James Donelson’s unregistered crypto trading platform operated as a futures commission merchant, subjecting him to federal oversight even though the tokens involved were not traditional commodities. The ruling signals a broader regulatory net for decentralized platforms and the people who run them.

Donelson built and ran a platform that let users trade perpetual contracts on digital assets. The CFTC sued him for operating without registration, misappropriating customer funds, and making false statements about the platform’s security. Donelson fought back, arguing the CFTC lacked jurisdiction because crypto tokens weren’t commodities under the Commodity Exchange Act. The district court rejected that defense and granted summary judgment; Donelson appealed, betting the Seventh Circuit would draw a sharper line between commodities and digital assets.

The appeals court didn’t buy it. Writing for the panel, Judge Scudder held that the CFTC’s authority extends to any derivative contract tied to an underlying asset traded in interstate commerce, and that bitcoin and ether clearly qualify. The judges also upheld findings that Donelson commingled customer money and lied about cold-storage protections, exposing traders to the exact risks the agency is charged with preventing. Because Donelson’s platform functioned like a traditional futures brokerage, it fell squarely inside the CFTC’s lane.

The decision tightens the definition of who must register and disclose. Any platform offering leveraged or derivative exposure to crypto now faces the same compliance burden as old-school futures brokers. That raises the cost of doing business for DeFi projects flirting with margin trading and gives the CFTC a clearer roadmap for enforcement against offshore or pseudonymous operators who touch U.S. customers.

For traders the message is blunt: unregistered platforms carry hidden legal risk that can freeze funds overnight. Exchanges that still skirt registration will either have to license up or route U.S. users elsewhere, pushing volume toward compliant venues and potentially widening spreads. Stablecoin issuers that embed leverage features could also find themselves reclassified as FCMs, a scenario most issuers have so far avoided.

The court stopped short of declaring every token a commodity, but the practical effect is the same: if you offer U.S. customers leveraged bets on crypto, the CFTC now believes it owns you—and the Seventh Circuit just agreed.

Intercontinental Exchange’s plan to build an NYSE-affiliated market for tokenized stocks gained additional infrastructure with the inclusion of transfer agent and settlement capabilities, according to blockchain capital markets firm tZERO.

Deal Adds Core Market Functions

tZERO said the deal brings transfer agent and settlement infrastructure to the initiative, two functions considered essential for issuing, recording, and finalizing ownership changes in securities. Transfer agents maintain shareholder records and process corporate actions, while settlement systems handle the exchange of securities and cash following trades.

ICE, NYSE, and tZERO: The Context

Intercontinental Exchange (ICE) is the parent company of the New York Stock Exchange (NYSE), the world’s largest stock exchange by market capitalization. tZERO develops technology for digital securities and blockchain-enabled capital markets. The firms’ efforts reflect growing interest in modernizing market plumbing to support assets recorded on distributed ledgers while aligning with existing regulatory frameworks.

What Are Tokenized Stocks?

Tokenized stocks are digital representations of equity interests recorded on a blockchain or distributed ledger. Proponents say tokenization can streamline record-keeping, enhance transparency, and potentially enable faster settlement compared with traditional systems. Any NYSE-affiliated market for tokenized equities would be subject to U.S. securities laws and oversight.

Outlook

tZERO did not provide additional details about the deal in its statement. Further information on structure, timing, and regulatory approvals was not immediately available.

COINBASE WINS—COURT ORDERS SEC TO REOPEN RULEMAKING DOORS

Coinbase just forced the SEC to confront its own silence. The Third Circuit ruled that the agency must formally respond to the exchange’s 2022 petition demanding clearer crypto rules, rejecting the SEC’s argument that it could simply ignore the request. Markets read the order as a direct rebuke of Gary Gensler’s “regulation by enforcement” strategy, and the price of COIN popped 4 percent on the news.

The lawsuit started when Coinbase asked the Commission to write new rules governing digital-asset trading, custody, and staking—essentially inviting the agency to admit that existing securities laws do not neatly cover the space. After months of no action, the exchange sued under the Administrative Procedure Act, claiming the SEC had unreasonably delayed. The SEC countered that it owed Coinbase nothing because the petition did not force the agency to start a rulemaking. A three-judge panel disagreed. Writing for the court, Judge Cheryl Ann Krause held that an agency cannot “bury” a rulemaking petition indefinitely; it must at least explain why it declines to act. The decision does not compel the SEC to write new rules, but it ends the agency’s ability to ghost the industry.

For traders and exchanges, the ruling shifts the battlefield from courtroom to conference table. If the SEC must now give reasons for inaction, it may face political pressure to offer at least a concept release or an advanced notice of proposed rulemaking. That would slow enforcement cases and give platforms a clearer compliance map. Stablecoin issuers and DeFi protocols, long caught in limbo, could also benefit: any fresh SEC guidance would likely address whether certain tokens are securities or commodities, influencing how exchanges list or delist them. Conversely, if the Commission uses the mandated response to double down on its current view, litigation risk could rise rather than fall.

The immediate takeaway is procedural, not substantive, but procedures matter in crypto. An agency forced to speak can no longer pretend the rules are obvious. Expect lawyers on both sides to mine the SEC’s upcoming reply for signals about enforcement priorities and possible safe harbors.

Strategy has purchased $370 million in bitcoin, marking its first corporate buy since June. The company also said it is strengthening its cash position and continuing to repurchase its perpetual STRC preferred stock.

First BTC Treasury Addition Since June

The latest acquisition ends a two-month pause in Strategy’s bitcoin accumulation. The company has been a prominent corporate buyer of BTC, using periodic purchases to expand its digital asset treasury as part of a broader balance sheet strategy.

Cash Reserves and Preferred Stock Buybacks

Alongside the bitcoin purchase, Strategy reported actions to bolster liquidity and continued buybacks of its perpetual STRC preferred shares. Buybacks can reduce outstanding preferred obligations and are often used to optimize capital structure and capital costs.

Why It Matters

Corporate bitcoin purchases can signal institutional confidence in the asset and may influence market liquidity. Strategy’s renewed activity highlights ongoing corporate interest in BTC as a treasury reserve, even as companies balance digital asset exposure with cash management and capital return initiatives.

Third Point, the hedge fund led by billionaire investor Dan Loeb, has disclosed an equity position in Core Scientific (NASDAQ: CORZ), adding another prominent institutional name to the growing investor focus on U.S.-listed Bitcoin miners. Terms and size of the position were not disclosed.

Third Point’s move into Bitcoin mining exposure

The disclosure marks a notable endorsement from a well-known activist and event-driven fund at a time when traditional finance participation in digital-asset infrastructure continues to broaden. Hedge funds and asset managers have increasingly used miners as a publicly traded proxy for Bitcoin exposure, particularly following the approval of U.S. spot Bitcoin ETFs in early 2024.

About Core Scientific

Core Scientific is one of North America’s largest Bitcoin mining and data center operators. The company filed for Chapter 11 in late 2022 and emerged from bankruptcy in January 2024, relisting on the Nasdaq under the ticker CORZ. Beyond self-mining, Core Scientific hosts third-party miners and has pursued opportunities in high-performance computing and AI-oriented infrastructure to diversify revenue streams.

Why miners are drawing institutional interest

• Operational leverage to Bitcoin: Public miners’ revenues and margins are closely tied to Bitcoin’s price and network difficulty, making them a leveraged bet on the asset.
• Post-halving dynamics: The April 2024 block reward halving reduced miner subsidies, pressuring higher-cost operators and accelerating industry consolidation and efficiency improvements.
• Data center optionality: Some miners are repurposing or expanding capacity for high-performance computing and AI workloads, potentially adding non-crypto revenue channels.

What to watch

• Core Scientific’s production updates, power costs, and hash rate growth relative to peers.
• Progress on hosting and high-performance computing initiatives that could diversify cash flows.
• Broader sector catalysts, including Bitcoin price moves, network difficulty trends, and regulatory developments affecting U.S. mining operations.

Robinhood Chain’s decentralized applications generated $2.66 million in revenue over a recent 24-hour period, surpassing Ethereum and Hyperliquid L1 on the same metric. The performance marks a notable milestone for the two-month-old network, which launched its public mainnet on July 1.

New L2 Tops Daily App Revenue

The 24-hour tally places Robinhood Chain ahead of more established ecosystems on application-level revenue, a metric that typically reflects fees and charges accrued by protocols running on a network (such as trading, swapping, or lending fees). While daily figures can fluctuate significantly, the showing underscores rapid early traction for the nascent chain.

Launched in July as an Arbitrum-Based Layer 2

Robinhood Chain is built using Arbitrum technology as a Layer 2 network anchored to Ethereum. The public mainnet went live on July 1 during Robinhood’s “The World Is Flat” event in London. As an L2, the chain is designed to batch and settle transactions more efficiently while leveraging Ethereum’s security model.

Competitive Context

Outpacing Ethereum and Hyperliquid L1 on 24-hour application revenue is significant given both networks’ mature user bases and deep liquidity. Ethereum remains the largest smart contract platform by total value and developer activity, while Hyperliquid L1 focuses on high-throughput trading use cases. Robinhood Chain’s result highlights the shifting dynamics of on-chain activity and the potential for newer networks to attract volume quickly.

What to Watch

• Sustainability: Single-day revenue snapshots can be volatile and influenced by a handful of high-volume applications or short-term campaigns. Multi-week trends will provide a clearer picture.
• Developer and user growth: Continued onboarding of applications and users will be key to maintaining revenue leadership.
• Ecosystem composition: The mix of DeFi, trading, and consumer apps generating fees will shape the network’s long-term profile.