CLARITY hopes are dashed, litigation approaches, BitMEX shuts down: Hodler 's Digest, July 26

The Clarity Act may be voted on, but don't get too much hope

Although wealthy memin entrepreneur Donald Trump agreed to an ethics agreement, the Clarity Act is still in trouble as the August recess deadline approaches. Senate Majority Leader John Thun believes the bill has not yet received enough votes to pass, but may be put to a vote to "start the process of clarity." We will see how the votes are."

The ethics agreement would ban all U.S. officials from issuing or sponsoring digital assets, but it contains some "immunity" clauses that upset Democrats, such as the rules that will expire in 2029, when the president is scheduled to leave office. In addition, the ethics clause will be enforced by the attorney general appointed by Trump . Democrats want state attorneys general to enforce it-but Trump seems unlikely to agree to authorize dozens of state attorneys general to try to prosecute him. The White House called the bill "the most comprehensive and wide-ranging ethics clause in history," while Democratic Senator Ruben Gallego described it as a "piece of shit" and a "unserious attempt."

Negotiations continue to find an agreement acceptable to both sides, but finding a compromise is not easy given the lack of trust. Goldman Sachs CEO David Solomon admitted that the bill was "not perfect" but still expressed support, as did Fidelity and Schwab, which each manage trillions of dollars in assets. Law enforcement agencies have also begun to show support, with the National Brotherhood of Police, which represents hundreds of thousands of members, saying the latest version of BRCA (Protecting Decentralized Protocol Developers) will not hinder investigations into money laundering and fraud. The probability of the bill passing this year is 38% on Polymarket.

BitMEX is shutting down after 11 years of operation and faces class action

BitMEX, one of the pioneers in cryptocurrency derivatives trading, announced that it will close its business in September after 11 years of operation. BitMEX was launched in 2014 and is known for introducing 100 times leveraged perpetual contracts. In recent years, its trading volume has fallen sharply due to intensified competition from major exchanges such as Binance and decentralized protocols such as Hyperliquid. CryptoQuant CEO Ki Young Ju said that BitMEX's share of the Bitcoin futures market has dropped to only 0.08%, with an average daily trading volume of approximately US$84 million. "This is a great exchange that helped shape the industry, and now it is passing the baton to the next generation of exchanges it inspires," Ju said. BitMEX's utility token, BMEX, plunged after the announcement. On the same day, it emerged that a class-action lawsuit accused the cryptocurrency derivatives platform of fraudulently manipulating customer clearing to seize collateral from traders. BitMEX denied the allegations and said it had previously successfully defended itself against similar allegations. Restructuring consultant Roshan Dharia told Cointelegraph that the exchange's collapse showed that the industry was consolidating. The top five platforms now control about 80% of global spot trading volume, leaving margins on mid-sized and regional exchanges shrinking and no viable path to scale... These headwinds are structural, not cyclical. As if to emphasize this point, BitMart subsequently announced that it would also shut down in the coming months.

Standard & Poor's launches blockchain digital asset fundamentals index

S & P Dow Jones Indices and Pantera Capital have launched a digital asset index that tracks major crypto assets-but excludes Bitcoin and XRP. The S & P Pantera Digital Assets Index aims to become the benchmark index for crypto for institutional investors, but will screen blockchains based on minimum thresholds for negotiated revenue, market capitalization and liquidity. The index initially contained 18 constituent stocks, of which Ethereum, BNB, Solana, TRON and Hyperliquid were the top five positions, while Bitcoin and XRP were the largest non-constituent stocks. The index is part of a broader industry push to develop institutional-level benchmarks for digital assets, with similar products including the Nasdaq Crypto Index U.S. ETF, the Franklin Crypto Index ETF, and the Coinbase Value Storage Index.

Robinhood plans to expand forecast market, CFTC issues new warning

Robinhood is reportedly discussing plans to expand its existing predictive market products, partnering with crypto exchange Crypto.com. According to the Wall Street Journal, the negotiations involved integrating "yes/no" event contracts provided by Crypto.com. Robinhood launched the Forecasting Market in March 2025, initially supported by Kalshi to comply with the U.S. Commodity Futures Trading Commission (CFTC) regulatory requirements. Bernstein analysts last week raised their target price for Robinhood stock to $160 a share from $130, based on the company's outlook for forecasting the market and tokenized stocks. At the same time, the CFTC, which aims to become the main regulator for forecasting markets, issued a warning to suppliers last week that platform certification of event contracts must be more specific. The consultation addressed concerns about the practice of submitting extensive, template-based certifications that combine many potential event contract variants into one certification. Carl Kennedy, a partner at New York law firm Katten Muchin, also said at a House Agriculture Committee hearing last week that the CLARITY bill could help the CFTC regulate efforts to "predict explosive growth in the market."

Balaji's online school turns to Kazakhstan due to Malaysia's setback

Balaji Srinivasan's "Internet School", a digital Traveller community, is considering establishing a new campus in Kazakhstan after its Forest City campus was revoked by Malaysia for allegedly violating site use regulations. Relevant Minister of Kazakhstan Zhaslan Madiyev and Srinivasan signed a memorandum of understanding to build the country's first online school campus, aiming to become a digital center. The school was driven out of Johor, Malaysia, amid controversy over Malaysia's admission to Israeli dual citizens. The Muslim-majority country has no diplomatic relations with Israel. Although the investigation found no visa violations, the online school was ordered to close under another excuse. Haseeb Qureshi, managing partner at Dragonfly Capital, said the turmoil verified Balaji's cyberstate theory. "The whole idea of the cyberstate is to bring together intensive talent and capital and engage in collective bargaining with the state. Events in Malaysia allowed Balaji to negotiate more favorable terms with another country to replicate the network there."

Winners and Losers

At the end of the week, Bitcoin was at $65,395, Ethereum was at $1,958, and XRP was at $1.11. According to CoinMarketCap data, the total market value is US$2.24 trillion. Among the top 100 cryptocurrencies by market cap, the top three altcoins that have gained this week were Audiera (BEAT), up 53%;Shiba Inu (SHIB), up 29%; and Venice Token (VVV), up 19%. The top three altcoins that fell this week were DeXe (DEXE), which fell 89%;Midnight (NIGHT), which fell 26%; and Pyth Network (PYTH), which fell 10%.

This week's forecast

Bitcoin will get a "boost" from Hyperliquid and Robinhood in the next bull market

Matt Hougan, chief investment officer at Bitwise, said Bitcoin "finally shows signs of a bottom." Hougan predicts that TradFi integrations, especially Hyperliquid and Robinhood, will drive the next cryptocurrency bull market, and the resulting wave should "boost" the largest cryptocurrencies, including Bitcoin and Ethereum. Hougan believes that cryptocurrencies are bringing significant benefits to traditional markets such as 24/7 trading, noting that today "nearly half of trading volume on Hyperliquid is concentrated on traditional assets such as oil, silver and the S & P 500, and is expanding into spot commodities, forecast markets and options." Bitwise data also showed that apparent demand for Bitcoin showed signs of reversal. The indicator measures the difference between newly mined bitcoins and a supply that has been inactive for at least a year.

FUD of the Week (Fear, Uncertainty and Doubt)

CertiK: In the first half of 2026, burglary became the most common form of cryptocurrency "wrench attack"

According to data from blockchain security company CertiK, burglary became the most common form of cryptocurrency wrench attack in the first half of 2026, with the number of publicly reported incidents rising from just 1 a year ago to 20. On Thursday, CertiK said that a total of 52 wrench attacks were verified globally in the first half of 2026, an increase of 33.3% from 39 in the same period in 2025. Kidnapping incidents increased from 12 to 16, while robberies decreased from 5 to 1. CertiK said recorded financial losses related to the attacks were approximately $124.1 million, up from $10.5 million a year ago. The increase in home robberies shows that criminals are increasingly bypassing digital security measures and using physical means to coerce cryptocurrency holders and their families.

Hackers steal US$31.6 million in two cryptocurrency bridge attacks in 7 hours

Hackers stole more than US$31.6 million in two unrelated cryptocurrency bridge attacks just hours apart, targeting bridges operated by the decentralized perpetual exchanges AFX and Verus Protocol. According to Blockaid, AFX, a decentralized perpetual exchange operating on Arbitrum, lost $24.15 million on Wednesday after hacking one of its cross-chain bridges. Hours later, Blockaid said it had detected an attack on the Verus Ethereum Bridge that resulted in the theft of approximately $7.5 million in cryptocurrency. Chain investigator TheCrypticWolf posted on X: "Another bridge, another attack. Bridges will always be a weak link until security upgrades."

Ethereum ETF closed down this week, ending five consecutive days of net inflows

U.S. -listed spot Ethereum exchange-traded funds (ETFs) recorded a net outflow of US$70.62 million on Friday, ending five consecutive days of net inflows. According to SoValue data, the Ethereum Fund has received a net inflow of $211.25 million over the past five trading days (since July 17). They still recorded net inflows of $103.9 million for the week ended Friday. Despite the outflows, the Ethereum ETF extended its weekly net inflow record to three consecutive weeks, attracting net inflows of $337.74 million so far in July. The Bitcoin ETF reversed gains earlier in the week and eventually recorded a net inflow of $33.9 million.

Selected Stories This Week's Magazine

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