A growing policy rift has emerged in Washington as crypto industry representatives push back against Wall Street bankers’ calls for a blanket prohibition on stablecoin yield. The disagreement centers on provisions tied to stablecoin rewards within the broader US Senate digital asset market structure legislation, which has faced delays amid the dispute.

Banking groups have argued that allowing yield on stablecoins could undermine traditional deposit models by drawing liquidity away from the regulated banking system. Their position paper, circulated in policy discussions, calls for a full ban on interest-like rewards tied to stablecoin holdings, framing the issue as a financial stability concern.

Industry Principles and Legislative Context

In response, the Digital Chamber has circulated its own principles document, arguing that limited reward mechanisms tied to activity, such as liquidity provision and ecosystem participation, should remain permissible. The group indicated a willingness to restrict rewards resembling passive interest payments, signaling an effort to position the crypto sector as open to compromise while preserving core decentralized finance incentives.

The debate is unfolding alongside the implementation of existing US stablecoin legislation and proposed revisions under a separate market clarity framework. Lawmakers are now weighing whether additional restrictions on yield would conflict with prior regulatory approaches that sought to legitimize stablecoin use within compliant financial structures.

Institutional and Macro Implications

The impasse highlights broader tensions between traditional financial institutions and crypto-native firms as stablecoins increasingly function as settlement and liquidity infrastructure across digital markets. Banks view yield-bearing stablecoins as a potential competitive threat to deposits, while crypto companies argue that reward mechanisms are integral to network participation and transaction efficiency.

From a legislative perspective, the outcome could shape the competitive landscape for regulated stablecoin issuers, fintech platforms, and DeFi protocols operating in the US. With policymakers seeking bipartisan support for comprehensive digital asset legislation, the stablecoin yield issue has become a focal point in balancing innovation, consumer protection, and systemic risk considerations within the evolving regulatory framework.

Trump Media & Technology Group has filed registration documents with the US Securities and Exchange Commission for two new cryptocurrency exchange-traded funds tied to Bitcoin, Ether, and Cronos. The filings, submitted through its Truth Social Funds unit, outline plans for a combined Bitcoin and Ether ETF and a separate Cronos Yield Maximizer ETF, both subject to regulatory approval.

The proposed products would be developed in partnership with Crypto.com, which is expected to provide custody, liquidity, and staking infrastructure if approved. Yorkville America Equities is listed as the investment adviser, with each fund projected to carry a management fee of 0.95%, positioning them competitively within the growing digital asset ETF landscape.

Product Structure and Market Positioning

According to the filings, the Bitcoin and Ether fund is designed to track the performance of the two largest cryptocurrencies by market capitalization while incorporating staking rewards associated with Ether. The Cronos-focused ETF would follow the performance of CRO and include yield generated through staking mechanisms, reflecting a broader shift toward income-oriented crypto investment vehicles.

The initiative aligns with Trump Media’s expanding digital asset strategy, following prior collaborations with Crypto.com and Yorkville entities to develop hybrid investment products combining cryptocurrencies and traditional sectors. The firm has also explored treasury exposure to digital assets, indicating a longer-term positioning within tokenized finance and blockchain-linked investment infrastructure.

Competitive and Macro Context

The filings come at a time of mixed flows across US-listed spot Bitcoin ETFs, which have recorded multiple consecutive weeks of net outflows amid macro-driven market volatility and shifting rate expectations. Despite short-term withdrawals, institutional participation in crypto ETFs remains structurally significant, with asset managers continuing to introduce new thematic and yield-focused products.

From a competitive standpoint, the entry of a media and technology conglomerate into the ETF space underscores intensifying competition among financial firms, fintech platforms, and crypto-native companies seeking to capture investor demand for regulated digital asset exposure. The inclusion of staking-based yield features also reflects an evolution in product design as issuers look to differentiate offerings beyond simple price tracking.

More broadly, the filings highlight the ongoing convergence between traditional capital markets and crypto infrastructure, as firms position themselves for a regulatory environment that increasingly accommodates tokenized assets, diversified digital portfolios, and income-generating blockchain products within mainstream investment frameworks.

The UK government has appointed HSBC’s Orion platform to support a pilot issuance of tokenized government bonds, known as gilts, under its Digital Gilt Instrument program. The initiative is part of HM Treasury’s broader effort to modernize sovereign debt issuance using distributed ledger technology. The pilot will operate within the Digital Securities Sandbox and run independently from the government’s core debt management operations.

The DIGIT program is designed to test digitally native, short-dated bonds with onchain settlement capabilities. Officials have said the objective is to improve operational efficiency, reduce issuance costs and enhance market accessibility. The Treasury first outlined the framework in 2025 as part of a strategy to strengthen the UK’s position in digital asset infrastructure and capital markets innovation.

Sovereign Debt Modernization Effort

HSBC Orion, launched in 2023, has facilitated more than $3.5 billion in digital bond issuances globally, including transactions for the European Investment Bank and the Hong Kong government. The UK appointment represents a domestic deployment of the platform in one of the world’s largest sovereign bond markets.

Treasury officials indicated that the pilot will also support the development of a secondary market for tokenized gilts. Onchain settlement could streamline post-trade processes and reduce reconciliation costs, aligning with broader global trends toward programmable securities.

Competitive Positioning in Digital Capital Markets

The UK’s move comes as jurisdictions including Singapore, Hong Kong, and the European Union expand tokenized bond experiments. Policymakers view distributed ledger technology as a means to attract capital flows and maintain competitiveness in global financial services.

Legal advisory firm Ashurst has also been appointed to support the pilot’s regulatory and structural framework. The collaboration underscores the institutional and compliance considerations required as sovereign issuers test blockchain-based infrastructure. For the UK, the DIGIT pilot represents a controlled step toward integrating tokenization into traditional debt markets while preserving regulatory oversight and market stability.

Coinbase has introduced Agentic Wallets, a new crypto wallet framework built to enable artificial intelligence agents to execute blockchain transactions without direct human approval. The product allows AI systems to hold funds, trade tokens, pay network fees, and interact with decentralized applications autonomously. The launch signals Coinbase’s push to position itself at the intersection of digital assets and machine-driven finance.

Introducing Agentic Wallets, our first ever wallet infrastructure built specifically for autonomous agents.

Give your agent the power of a wallet. Let your agent manage funds, hold identity, and transact onchain without human intervention. 🧵 pic.twitter.com/Ns0SmSIys4

— Coinbase Developer Platform🛡️ (@CoinbaseDev) February 11, 2026

The wallets are powered by the x402 protocol, a payment standard designed to facilitate machine-to-machine transactions. According to Coinbase, the protocol has processed more than 50 million transactions to date. Developers can deploy and fund Agentic Wallets using command-line tools, with built-in functions that support transfers, trading, and yield generation without requiring extensive blockchain engineering expertise.

Infrastructure for Autonomous Financial Activity

Agentic Wallets are integrated with Base, Coinbase’s Layer-2 network, and support gasless trading to reduce operational friction for autonomous agents. This feature is designed to prevent disruptions if an AI agent exhausts network fees during execution. By abstracting transaction costs and simplifying deployment, Coinbase aims to make blockchain interactions more accessible for automated systems.

The move reflects broader industry efforts to expand programmable finance beyond human-initiated transactions. As AI systems increasingly participate in data processing, trading analytics, and portfolio optimization, the ability to directly execute transactions could reshape operational workflows in decentralized finance and digital asset markets.

Guardrails and Institutional Considerations

Coinbase emphasized that autonomy is paired with risk controls. Agentic Wallets include programmable spending limits, session caps and compliance screening tools to manage exposure. Private keys are secured within Coinbase’s infrastructure, aligning with enterprise-grade custody standards.

The launch comes as financial institutions and technology firms explore AI integration in trading, treasury management, and digital payments. While regulatory frameworks for AI-driven financial activity remain under development, infrastructure providers are positioning for a future in which software agents act as economic participants.

By enabling AI systems to transact directly onchain, Coinbase is expanding its developer ecosystem beyond retail and institutional clients to machine-native users. The initiative highlights the convergence of blockchain settlement rails and automated intelligence, a theme gaining traction as digital asset platforms compete to define the next phase of financial infrastructure.

Hong Kong’s Securities and Futures Commission (SFC) said it will permit licensed brokers to provide virtual asset margin financing and outlined a regulatory framework for crypto perpetual contracts aimed at professional investors. The measures mark a further expansion of the city’s supervised digital asset market while maintaining limits on retail participation.

Under the updated guidance, brokers may extend margin financing backed by virtual assets to eligible securities margin clients with sufficient collateral and established credit profiles. Initially, only Bitcoin and Ether will qualify as collateral. The SFC said the initiative is structured within the existing securities margin regime, including controls on collateral concentration, valuation haircuts, and governance standards.

The regulator also introduced a high-level framework allowing licensed virtual asset trading platforms to develop leveraged perpetual contracts. Access will be restricted to professional investors, and affiliated entities may act as market makers subject to conflict-of-interest safeguards, operational independence, and enhanced security requirements.

Liquidity and Market Depth under ASPIRe

In remarks delivered at Consensus Hong Kong 2026, SFC Executive Director Eric Yip said the regulator’s digital asset agenda has entered a “defining stage” under its Access, Safeguards, Products, Infrastructure and Relationships, or ASPIRe, roadmap. He characterized liquidity and price discovery as central priorities for 2026.

Yip said the margin financing framework is designed to enable responsible leverage that supports market depth without undermining financial stability. He added that perpetual products will follow a principles-based model emphasizing disclosure, internal risk controls and transparent governance. The inclusion of affiliate market makers, he noted, aims to narrow spreads and improve execution quality within a supervised environment.

Competitive Positioning in Regional Crypto Markets

The policy shift comes as Asian financial centers compete to attract digital asset businesses amid evolving global regulatory standards. Hong Kong has pursued a regulated-access model, emphasizing institutional participation and robust oversight rather than broad retail liberalization.

Recent announcements include plans to introduce legislation covering crypto advisory services and align reporting requirements with the OECD’s Crypto-Asset Reporting Framework. Separately, the Hong Kong Monetary Authority has indicated it may begin granting stablecoin issuer licenses in the coming months, with initial approvals expected to be limited.

Together, the margin financing and perpetual trading framework signal Hong Kong’s intent to deepen its regulated crypto derivatives and financing markets. By expanding product offerings for professional investors while preserving supervisory guardrails, authorities are seeking to balance innovation, competitiveness and systemic risk management in a rapidly evolving sector.

The European Parliament has formally endorsed the European Central Bank’s digital euro initiative, positioning it as a strategic instrument to reinforce the bloc’s monetary sovereignty and payment resilience. Lawmakers adopted the ECB’s annual report with 443 votes in favor, 71 against, and 117 abstentions, backing language that described the digital euro as essential to safeguarding the integrity of the single market.

The resolution highlights concerns over Europe’s dependence on non-EU payment providers and private digital instruments. Members of the European Parliament emphasized that a central bank-issued digital currency could help reduce fragmentation in retail payments while preserving the role of public money in an increasingly digital economy. At the same time, lawmakers reiterated that the ECB must remain independent and insulated from political pressure.

Central Bank Independence and Institutional Credibility

During the parliamentary debate, several lawmakers stressed that institutional credibility rests on the ECB’s autonomy. Johan Van Overtveldt, a Belgian MEP and former finance minister, warned that political interference in monetary policy historically leads to inflation and financial instability. He argued that reaffirming central bank independence is particularly important amid heightened geopolitical tensions and economic uncertainty.

The resolution underscores that both cash and a future digital euro would retain legal tender status, signaling a dual-track approach to public money. By preserving physical currency alongside a digital alternative, policymakers aim to balance innovation with continuity in the euro area’s monetary framework.

Strategic Payments Infrastructure in a Shifting Global Order

Support for the digital euro reflects broader macroeconomic and geopolitical considerations. ECB officials have increasingly framed the project as a hedge against external vulnerabilities, including reliance on foreign payment networks and the growing presence of private stablecoins. In recent remarks, senior ECB figures described the digital euro as public money in digital form, designed to ensure that core retail payments infrastructure remains under European control.

The debate also comes as other major economies explore central bank digital currencies and as global payment systems become more interconnected. Policymakers and economists have argued that without a public digital option, private issuers and overseas providers could expand their influence in Europe’s payments ecosystem, particularly during periods of market stress.

While the digital euro remains in the preparatory phase, parliamentary backing strengthens the political foundation for continued development. The initiative now sits at the intersection of monetary policy, financial stability, and strategic autonomy, as European institutions weigh competitiveness and resilience in a rapidly evolving digital payments landscape.

Former FTX chief executive Sam Bankman-Fried has petitioned a federal court for a new trial on fraud charges, arguing that previously unavailable witness testimony could materially weaken the government’s case. The motion, filed on February 5 in Manhattan federal court, challenges his 2023 conviction that resulted in a 25-year prison sentence. The request is separate from Bankman-Fried’s ongoing appeal and faces a high legal threshold, with new trials granted only in limited circumstances.

The filing was submitted on Bankman-Fried’s behalf by his mother, Barbara Fried, a retired Stanford Law School professor. Courts generally require that new evidence be both unavailable at the time of trial and likely to produce a different outcome. Legal analysts cited by Bloomberg have described the effort as a long shot, though it keeps pressure on the conviction as appeals proceed.

Witness Testimony and Judicial Conduct

Bankman-Fried’s motion centers on potential testimony from former FTX executives Daniel Chapsky and Ryan Salame, neither of whom testified at trial. The defense argues that their accounts could challenge the prosecution’s portrayal of FTX’s financial condition prior to its November 2022 collapse. Prosecutors had argued that customer funds were systematically misused to support affiliated trading firm Alameda Research.

Salame previously pleaded guilty to campaign finance and fraud-related charges and is serving a seven-and-a-half-year prison sentence. Bankman-Fried contends that the absence of this testimony limited the jury’s understanding of internal decision-making at FTX. The motion also asks that a different judge review the request, alleging that trial judge Lewis Kaplan displayed prejudice that constrained the defense’s case.

These arguments mirror claims raised during Bankman-Fried’s appeal, including assertions that the court improperly restricted evidence suggesting sufficient assets existed to repay customers. Kaplan has previously rejected those claims, stating that the proposed evidence did not negate fraudulent intent.

Broader Industry and Institutional Context

The renewed legal maneuver comes as the crypto industry continues to grapple with the institutional fallout from FTX’s collapse, one of the most consequential failures in digital asset history. The case accelerated regulatory scrutiny globally, reshaped risk assessments among institutional investors, and contributed to tighter controls at exchanges and trading firms.

Meanwhile, the FTX bankruptcy estate has made progress in returning funds to creditors. Court-appointed administrators distributed billions of dollars in 2025 through a phased repayment process, with further payouts expected as asset recoveries continue. Those efforts have partially restored confidence among affected customers, even as legal proceedings against former executives remain active.

For regulators and market participants, Bankman-Fried’s motion underscores the prolonged legal aftershocks of the FTX failure. While unlikely to succeed, the bid for a new trial highlights how high-profile enforcement cases can remain contested years after a verdict, influencing perceptions of accountability and governance across the digital asset sector.

Gemini’s decision to exit the United Kingdom, the European Union, and Australia to refocus on the United States and Singapore has sharpened debate over whether the UK’s unfinished crypto rulebook is deterring firms policymakers hoped to attract. The move comes nearly three years after the UK government publicly committed to making the country a global center for cryptoasset technology.

In a strategy update published February 5, Gemini said several international markets had proven “hard to win,” leaving the exchange operationally stretched and facing rising organizational complexity and costs. While the company did not single out regulators, industry groups say the decision reflects mounting frustration with regulatory uncertainty and compliance burdens relative to market opportunity.

Regulatory Ambition Meets Execution Risk

In April 2022, then-Chancellor Rishi Sunak outlined plans to position the UK as a global crypto hub, announcing stablecoin legislation and launching a Financial Conduct Authority CryptoSprint to accelerate rulemaking. Nearly four years later, large parts of the framework remain in transition, with firms operating under interim guidance and overlapping regimes.

Susie Violet Ward, chief executive of Bitcoin Policy UK, said Gemini’s exit illustrates how drawn-out rulemaking and high compliance costs are discouraging investment. She noted that companies face a patchwork of anti-money laundering registration, financial promotions rules, and provisional standards while a full prudential regime remains years away. According to Ward, capital deployment depends on regulatory clarity and confidence, both of which remain limited.

Laura Navaratnam, head of UK policy at the Crypto Council for Innovation, described Gemini’s withdrawal as a blow for policymakers attempting to finalize the framework ahead of license applications opening later this year. Under current proposals, crypto firms serving UK customers will need to apply for full FCA authorization during a five-month gateway window from late 2026, before the new regime takes effect in 2027.

Compliance Costs and Competitive Pressure

Industry executives warn that unresolved issues could prompt further exits. Navaratnam highlighted uncertainty around how the FCA’s stablecoin rules will interact with the Bank of England’s systemic oversight regime, raising the risk of abrupt transitions for firms as they scale. Without alignment, companies may face a regulatory cliff edge as they move between frameworks.

CoinJar chief executive Asher Tan said the shift from a limited AML registration model to full Financial Services and Markets Act authorization materially raises the operational burden for exchanges. Firms must now weigh the cost of meeting higher capital, liquidity, and governance standards against the commercial opportunity of the UK market.

While retrenchment is not unique to Britain, critics argue the UK risks losing ground to jurisdictions offering clearer timelines and more predictable requirements. Surveys cited by Bitcoin Policy UK indicate that banking access challenges and account closures remain common, further complicating operations for crypto businesses.

The FCA is currently consulting on a proposed prudential regime that would extend its rules to trading, staking, and dealing activities, embedding capital and liquidity requirements across the sector. The consultation closes this week, with the full regime expected to take effect in late 2027.

For firms considering long-term commitments, the direction of travel may be clear, but the costs are rising. Gemini’s exit suggests that until the UK delivers a coherent and timely framework, its ambition to be a global crypto hub will remain difficult to realize.

US spot Bitcoin exchange-traded funds extended a tentative recovery this week, drawing $145 million in net inflows on February 9 as Bitcoin traded near the $70,000 level. The latest additions follow $371 million in inflows last Friday, offering early indications that institutional demand may be stabilizing after weeks of sustained redemptions.

While the recent inflows have not reversed broader losses, they mark a notable deceleration in selling pressure. Spot Bitcoin ETFs remain down $1.9 billion year-to-date and recorded $318 million in outflows last week. However, the slowing pace has led some analysts to suggest the market may be approaching an inflection point for crypto investment products.

Slowing Redemptions Signal Possible Inflection

According to CoinShares, crypto fund outflows moderated sharply despite continued price volatility. CoinShares head of research James Butterfill said outflows slowed to $187 million even as Bitcoin remained under pressure, a pattern that has historically preceded trend reversals in digital asset flows.

Bitcoin’s price action has been shaped more by macro conditions than crypto-specific stress. Tighter financial conditions and elevated interest rates have weighed on risk assets broadly, limiting upside despite growing institutional participation. Analysts at Bernstein recently described the current downturn as the weakest bear case in Bitcoin’s history, pointing to the absence of major failures across exchanges, custodians, or lending markets.

This relative resilience has helped contain ETF redemptions compared with previous drawdowns, when structural breakdowns accelerated investor exits. The stabilization in flows suggests that long-term allocators may be reassessing exposure rather than continuing to reduce positions.

Early Holders Trim, Not Exit

Bitcoin’s increasing institutionalization has raised concerns that early adopters could exit the market as large asset managers gain influence through ETFs. However, executives at Bitwise argue that this dynamic has not played out in practice.

Bitwise chief investment officer Matt Hougan said early Bitcoin holders are largely maintaining exposure, even as ETFs experience volatility-driven flows. Rather than exiting entirely, many long-term holders are selectively trimming positions after substantial gains. This behavior has helped maintain a base of non-institutional ownership alongside new capital entering through regulated products.

Hougan acknowledged that a subset of early Bitcoin supporters remains uncomfortable with the growing role of traditional finance firms. However, he described that group as a shrinking minority as the asset class matures and integrates further into institutional portfolios.

Broader ETF Market Context

The rebound in Bitcoin ETFs has also coincided with renewed interest in spot altcoin products. On Monday, Ether ETFs recorded $57 million in inflows, while XRP-focused products added $6.3 million, according to market data. The broader participation suggests that investors are selectively re-engaging with crypto exposure rather than abandoning the sector altogether.

As Bitcoin continues to trade within a macro-driven range, ETF flows are likely to remain sensitive to shifts in liquidity and rate expectations. Still, the recent inflows point to a market transitioning from forced selling toward more balanced positioning, reinforcing the view that institutional participation is becoming a stabilizing force rather than a source of volatility.