Today's News Highlights:
The New York Times: The U.S. SEC is reducing its enforcement efforts in the cryptocurrency sector.
U.S. lawmakers are forming a working group in the House and Senate to draft cryptocurrency and stablecoin legislation.
Acting Chair of the CFTC: The CFTC is no longer enforcing regulatory oversight.
Berachain plans to announce its token economics tomorrow, launching its mainnet on February 6 and simultaneously conducting a token TGE.
Jupiter will launch its JUP buyback mechanism this week.
Sun Yuchen: Li Lin concealed due diligence materials when selling Huobi, with an internal hole of $30 million.
Li Lin responds: There is no so-called "funding hole," and there is a misunderstanding between both parties regarding the calculation of financial data at the time of delivery.
U.S. publicly traded company Semler Scientific invests $88.5 million to acquire 871 BTC.
The NYSE has submitted a 19b-4 filing application for the Grayscale LTC ETF to the U.S. SEC.
Regulation/Macro
Coinbase urges U.S. regulators to clarify whether banks can serve cryptocurrency businesses
Today, Coinbase sent a letter to the Office of the Comptroller of the Currency (OCC), the Federal Reserve Board (Fed), and the Federal Deposit Insurance Corporation (FDIC), requesting regulators to confirm whether banks can freely provide services to cryptocurrency businesses and clarify the current state of banking services in the crypto industry.
In the letter, Coinbase requested the OCC to withdraw an interpretive letter that is seen as "effectively setting a new application process for bank activities" and restricting banks from entering the crypto asset market. Coinbase also asked the Fed and FDIC to confirm whether state-chartered banks are allowed to provide crypto custody and execution services and outsource them to third-party service providers.
According to Bloomberg, Coinbase stated that current federal laws authorize banks to provide crypto services and collaborate with third-party service providers like Coinbase. However, regulators still need to confirm this. To support this claim, Coinbase has also invited three law firms. Coinbase's Chief Policy Officer Faryar Shirzad stated, "Regulators need to make it clear that banks can work with third parties to provide customers with crypto trading and exchange services."
The issue of U.S. banks providing services to the crypto industry has been contentious. While banks like BNY Mellon have begun offering crypto custody services, reports have also indicated that the FDIC has contacted several U.S. banks, asking them to pause crypto-related activities. In June 2024, Coinbase filed a lawsuit against the SEC and FDIC, accusing these agencies of "jointly attempting to exclude crypto asset companies from basic banking services." In the ongoing legal battle, Coinbase's legal chief Paul Grewal reiterated this accusation in January 2025, claiming that the FDIC deliberately concealed "suspension letters" related to crypto in the Freedom of Information Act lawsuit.
The New York Times: The U.S. SEC is reducing its enforcement efforts in the cryptocurrency sector
According to the New York Times, five informed sources revealed that the U.S. Securities and Exchange Commission is downsizing a special task force of over 50 lawyers and staff that was specifically responsible for cryptocurrency enforcement actions. This move is one of the first concrete measures taken by President Trump and his administration to reduce regulation of cryptocurrencies and other digital assets. One of Trump's initial executive orders aimed to promote the development of cryptocurrencies and "eliminate excessive regulation of digital assets."
Informed sources stated that some lawyers from the cryptocurrency task force are being reassigned to other departments within the SEC. A senior lawyer from the task force has been moved out of the enforcement division. Some individuals familiar with the changes described this reassignment as an unfair demotion.
Current acting SEC Chair Mark T. Uyeda has made a series of appointments while adjusting other senior positions at the SEC. The commission employs over 1,000 lawyers. One of Uyeda's first actions upon taking office was to establish a task force to review how the SEC handles digital assets. This task force is led by SEC Commissioner and outspoken cryptocurrency supporter Hester Peirce.
U.S. lawmakers are forming a working group that includes members from key committees in both the House and Senate to develop a regulatory framework for digital assets and stablecoins. At a press conference on Tuesday, David Sacks, the White House's head of artificial intelligence and cryptocurrency affairs, announced the formation of this bicameral working group alongside Senate Banking Committee Chair Tim Scott, Senate Agriculture Committee Chair John Boozman, House Financial Services Committee Chair French Hill, and House Agriculture Committee Chair G.T. Thompson.
The Senate has already been advancing regulatory work on stablecoins. Senator Bill Hagerty introduced a bill on Tuesday aimed at creating a regulatory framework, including parameters for whether issuers are regulated by the federal or state government. Hill stated that future stablecoin legislation will be "very similar" to the Senate's proposal. Hill emphasized that future legislation to regulate the overall market structure of cryptocurrencies will be similar to the "Financial Innovation and Technology Act of the 21st Century" (FIT21) and highlighted its bipartisan support.
The newly established cryptocurrency task force at the U.S. Securities and Exchange Commission (SEC) will undertake a series of priority tasks as the agency takes a different direction from the past few years. The task force, led by Republican Commissioner Hester Peirce, will focus on distinguishing which "crypto assets" qualify as securities, potentially changing the way companies register and providing clear statements when approving or denying exchange-traded products.
Peirce outlined her task list in a statement on Tuesday and included a link to the cryptocurrency task force, noting that the list is not exhaustive. One of the priority tasks is to classify certain tokens as "non-securities." Peirce stated, "The task force is also considering recommending that the commission take action to provide temporary forward-looking and retroactive exemptions for certain token issuances, provided that the issuing entity or other responsible parties provide specific information, keep the information updated, and agree not to challenge the commission's jurisdiction in cases involving asset sale fraud." Peirce added, "We will work with other federal agencies, state securities regulators, and international counterparts, inviting builders, enthusiasts, and skeptics to engage with us to determine what the final rules should be and what temporary measures can be taken in the meantime to promote innovation."
At a Washington press conference held jointly with leaders of key congressional committees on Tuesday, David Sacks, the newly appointed "crypto affairs chief" by President Donald Trump, outlined the new administration's broad pro-crypto agenda. When asked about the role of cryptocurrencies in the recently proposed U.S. sovereign wealth fund, Sacks revealed that assessing potential Bitcoin reserves is the top priority for the internal government working group.
Sacks stated in response to reporters' questions, "We are still waiting for some cabinet members in the working group to be confirmed, but once the confirmations are in place, one of our top priorities will be to assess the feasibility of Bitcoin reserves." He added that the sovereign wealth fund is a different concept, and Trump-nominated Commerce Secretary Howard Lutnick will be responsible for this matter.
Acting Chair of the CFTC: The CFTC is no longer enforcing regulatory oversight
Caroline Pham, acting chair of the U.S. Commodity Futures Trading Commission (CFTC), stated on Tuesday that the agency has restructured its enforcement division to "refocus" on combating fraud and "stop regulating through enforcement."
Under the leadership of former CFTC Chair Rostin Behnam, the CFTC's enforcement division had multiple task forces, including one focused on insider trading, one on cybersecurity and emerging technologies, and one aimed at combating environmental fraud. This restructuring has reduced the number of task forces to two. The newly formed "Complex Fraud Task Force" will handle enforcement actions related to complex fraud and manipulation across all asset classes, from preliminary investigations to litigation. Paul Hayeck, deputy director of the enforcement division, will serve as the acting head of the Complex Fraud Task Force. The "Retail Fraud and General Enforcement Task Force" will handle retail fraud and general enforcement matters, led by Charles Marvine, who also serves as deputy director of the enforcement division.
Pham stated in a news release, "This streamlined structure will stop regulating through enforcement and improve efficiency, and these urgently needed reforms will maximize the CFTC's resources to take more action against fraudsters and other bad actors, rather than punishing law-abiding citizens." According to the CFTC's announcement, the new structure will "more effectively utilize the CFTC's resources to prevent fraud, manipulation, and abuse, and ensure market integrity," while "providing enhanced governance and oversight of enforcement matters to prevent over-enforcement and enhance consistency, fairness, and due process."
Ohio Senator proposes establishing Bitcoin reserves and accepting it as a payment method
According to Bitcoin Magazine, Ohio Senator Sandra O'Brien has proposed a bill to establish Bitcoin reserves and require state entities to accept Bitcoin as a payment method.
Project Updates
The NYSE has submitted a 19b-4 filing application for the Grayscale LTC ETF to the U.S. SEC
The official Litecoin account on X platform stated that the NYSE has now submitted a 19b-4 filing application for the Grayscale LTC ETF to seek to convert its Litecoin (LTC) trust into a spot ETF.
It is reported that the 19b-4 application refers to a rule change proposal submitted to the U.S. Securities and Exchange Commission (SEC), typically submitted by exchanges (such as NYSE or Nasdaq) to list new financial products (such as ETFs).
The Berachain Foundation officially announced that the Berachain token TGE will take place simultaneously with the mainnet launch, and the token economics and Checker (or airdrop checker) will be launched tomorrow. Earlier today, the Berachain Foundation announced that the Berachain mainnet will launch on February 6, 2025.
The XRP Ledger spontaneously recovered this morning after about an hour of interruption in block production, a rare event for the network. Network activity froze at Ledger height 93927173, prompting validators to immediately investigate. The XRP Ledger then resumed normal operation, with no reported asset or transaction losses.
XRPL Chief Technology Officer David Schwartz stated on the X platform: "It seems that the consensus mechanism was still running, but the validation results were not published, leading to network separation. As far as I know, very few UNL (Unique Node List) operators made any changes, so the network may have spontaneously recovered." The UNL mentioned by Schwartz is a core component of the XRPL consensus mechanism, serving as a directory of trusted validators to ensure the integrity of the network and the finality of transactions.
Mode-based Ionic platform hacked, approximately $8.8 million lost
According to an official announcement from Ionic, the Mode-based Ionic platform was hacked, with attackers using unofficial fake LBTC (Lombard BTC) as collateral for lending on the Ionic platform. The team is currently investigating. Security company QuillAudits estimates the loss from this attack to be around $8.8 million.
On-chain detective ZachXBT commented on the matter: "Ionic is the successor to the Midas protocol, which suffered two hacks in 2023, while the Ionic project launched using an old audit report from Midas in 2022." ZachXBT had previously privately messaged the team questioning the security of Ionic's contracts, to which the team responded that their codebase is based on a Compound fork, and the vulnerabilities in Midas were due to known issues in the Compound code. These problems have been addressed through measures such as implementing whitelists in new pools and reentrancy attack circuit breakers, emphasizing that Ionic is very secure.
Jupiter will launch the JUP buyback mechanism this week
Jupiter founder meow announced a preliminary buyback plan on the X platform at the end of last month, stating that funds will be transferred to the buyback wallet weekly for regular investments in JUP, which will be locked in the litterbox for at least three years. More details will be shared when the buyback plan begins this week, starting on February 3.
Previously, the network stated that half of the protocol fees (i.e., 50%) would be used for long-term buybacks, while the remaining 50% would be invested in project growth, future strategies, and overall operational stability.
Celestia community proposes to reduce TIA inflation rate by 33%, founder expresses support
The Celestia (TIA) community has initiated a new proposal to reduce the TIA inflation rate by 33%. In response to the proposal, Celestia founder Mustafa Al-Bassam stated: "I support this proposal. When we first decided on the inflation rate, we referenced Solana's inflation plan to keep it relatively simple, as we did not want to follow the Cosmos standard inflation plan (i.e., a permanent 10% inflation rate). The recent consensus in the community is that this number is still too high, and now Solana is also proposing to lower the inflation rate, so it's time for Celestia to adjust as well. I believe a 33% reduction is the right balance; it can effectively adjust the inflation curve without overly jeopardizing the security of the crypto economy."
Tether's AI division Tether Data to launch open-source AI SDK platform
Tether CEO Paolo Ardoino announced on X that Tether Data is developing applications such as AI translation, AI voice assistants, and AI Bitcoin wallet assistants. Tether is about to launch its own open-source AI SDK platform, built on Bare (Holepunch's JavaScript runtime), which can run on any hardware, from embedded devices, any phone (whether budget or high-performance), any laptop, powerful servers to server clusters. Tether Data's applications will focus on running locally on any device, ensuring complete privacy and self-custody (including data and funds).
Stripe completes $1.1 billion acquisition of Bridge, preparing to promote stablecoins
Payment company Stripe officially completed its acquisition of stablecoin infrastructure company Bridge for $1.1 billion on Tuesday. This is Stripe's largest acquisition to date, marking a significant move in the stablecoin space.
The approximately 60-person team from Bridge has completed onboarding at Stripe's San Francisco headquarters. Bridge focuses on helping businesses accept stablecoin payments while reducing the complexity of direct exposure to digital assets, with clients including Coinbase and SpaceX. Stripe supported Bitcoin payments in 2014 but terminated related services in 2018. The acquisition of Bridge enables Stripe to optimize cross-border payment solutions and expand its stablecoin payment infrastructure.
Financing
Taproot Wizards is raising $30 million in a new funding round, led by Standard Crypto
The Bitcoin Ordinals project Taproot Wizards is raising $30 million in its first post-seed round. This round of financing is led by early supporter Standard Crypto, with participation from Cyberfund, Collider Ventures, and others. The project will use the new funds to drive the development of the OP_CAT ecosystem to enhance Bitcoin's smart contract capabilities.
It is reported that Taproot Wizards was founded in 2023, and in February 2023, the minting of Taproot Wizard #0001 produced a 4MB block, which was the largest block and transaction in Bitcoin at that time. The team also launched the Ordinals series Quantum Cats, which is currently the highest market cap Bitcoin NFT project.
Previously in November 2023, Taproot Wizards completed a $7.5 million financing round.
Crypto autonomous AI agent platform Olas completes $13.8 million financing, led by 1kx
The crypto autonomous AI agent platform Olas has completed $13.8 million in financing to support the launch of an agent application store called Pearl. This round of financing is led by 1kx, with participation from Tioga Capital, Sigil Fund, Zee Prime Capital, Borderless, Keyrock, and others. The Olas team stated that the funds will be used to support its agent application store, aiming to democratize access to user-owned AI agents.
Alongside the financing announcement, Olas also launched the Olas Accelerator program, which provides $1 million in grants and OLAS token rewards to developers building agents on the platform. Olas's tech stack includes Olas Stack and Olas Protocol, which incentivize the creation and co-ownership of AI agents. The team stated that it has facilitated over 3.5 million transactions from agents across nine blockchains.
DePIN project Beamable completes $13.5 million Series A financing, led by Bitkraft Ventures
The decentralized gaming infrastructure platform Beamable has completed $13.5 million in Series A financing, led by Bitkraft Ventures, with participation from Arca, Advancit Capital, 2Punks, P2 Ventures, Solana Foundation, Scytale Digital, defy.vc, GrandBanks Capital, and Permit Ventures.
The new round of financing aims to accelerate the development and expansion of the Beamable Network, a decentralized physical infrastructure network (DePIN) designed to change the way gaming backend infrastructure is built and operated.
Opinions
Sun Yuchen stated on X: "Those familiar with the situation know that Li Lin concealed due diligence materials at the time of the sale of Huobi, and there was a $30 million hole internally, which I discovered after the fact. After exposing it, he played tricks and refused to give a single cent, and I lent the company the money to fill it."
Huobi founder Li Lin responded to Sun Yuchen's doubts, stating that during the HTX delivery process in October 2022, there was a significant disagreement between both parties regarding the calculation of user assets. He communicated multiple times with Sun Yuchen, who clearly expressed a desire to further verify the accounts and clarify the facts. Therefore, this is not a so-called "concealment of allocation" or "funding hole," but rather a misunderstanding of the financial data calculation method at the time of delivery due to significant changes in core personnel and financial data over the two years since the delivery was completed. The "30 million dollar funding hole" mentioned by Sun Yuchen essentially refers to a situation where the trading platform faced a margin call (leverage) due to extreme market conditions. At the time of delivery, this portion was already addressed using company revenue, and the assets delivered to the seller fully covered user assets, with no so-called "funding hole" existing. Li Lin fully supports a fair ruling through the Hong Kong court or a third-party arbitration institution to protect the legal rights of all parties through legal means, rather than unilaterally using social media for one-sided judgment.
SkyBridge Capital founder Anthony Scaramucci stated that Trump's unpredictability will bring short-term turbulence to the crypto market. Although Bitcoin and cryptocurrencies are long-term winners, they must endure Trump's comprehensive attacks. However, Anthony Scaramucci mentioned that SkyBridge Capital will fully invest in cryptocurrencies, with his company holding $1.4 billion worth of digital assets, accounting for 57% of the total assets under management. Additionally, over 60% of his personal wealth is in Bitcoin.
Anthony Scaramucci added that if there is comprehensive adoption by institutions, allowing banks to custody cryptocurrencies, hold them on their balance sheets, and use their capital to become major investors in cryptocurrencies, it would be a very powerful move.
Important Data
US-listed company Semler Scientific spent $88.5 million to increase its holdings of 871 BTC
US-listed company Semler Scientific announced today that it has spent $88.5 million to increase its holdings of 871 BTC. Since July 1, 2024, Semler Scientific's BTC yield has been 152%, and it currently holds 3,192 BTC.
Previously reported, Semler Scientific completed the pricing of $85 million in convertible senior notes, with an annual interest rate of 4.25%, maturing in 2030, and an initial conversion price of $76.44 per share, a 25% premium over the closing price on January 23. Part of the proceeds ($6.6 million) will be used for capped options trading, with the remaining funds used for corporate purposes, including Bitcoin investments.
According to Onchain Lens monitoring, Tether minted 1 billion USDT on the Tron network in the past six hours, bringing the total USDT minted on the Tron network to 2 billion since 2025. Circle minted 250 million USDC on Solana. Since 2025, Circle has minted a total of 65 million USDC on Solana.
According to Messari data, Solana's on-chain GDP (total application revenue) in the fourth quarter of 2024 increased by 213% quarter-on-quarter, reaching $840 million. Among them, Pump Fun generated $235 million in revenue during the quarter, a quarter-on-quarter increase of 242%; Photon generated $140 million, a quarter-on-quarter increase of 278%; Raydium generated $74 million, a quarter-on-quarter increase of 268%; BullX generated $73 million, a quarter-on-quarter increase of 260%; Trojan generated $63 million, a quarter-on-quarter increase of 187%.
According to on-chain analyst @ai_9684xtpa, a certain ETH whale is reducing its holdings of 4,117 ETH (worth $11.37 million) purchased in 2021, expected to profit $2.45 million. Previously, this whale did not sell these ETH even when the last bull market peaked at $4,800.
Between February and September 2021, he purchased 7,693 ETH at an average price of $2,167. In the past 13 hours, he has swapped 2,117 of them for WBTC and deposited another 2,000 into Binance.
He currently still holds 30,797 ETH, most of which are staked in EigenLayer and ether.fi.
According to Onchain Lens monitoring, a trader turned $1,854 into $2.28 million on the SSE token. The trader purchased 108,614,413 SSE on Pump.Fun for 9.35 SOL ($1,854). The trader has not sold any tokens yet, and the current floating profit is $2.28 million.
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