Crypto Industry News & Market Trends

Coinkite Faces Class Action Threat as Bitcoin Wallet Bug Costs Users Over 1,300 BTC

Key TakeawaysVictims are planning class-action lawsuits against Coinkite after losing $88 million to the Coldcard wallet bug.Legal experts are sharply divided on Coinkite‘s liability, complicating victims’ prospects for recovering funds.These potential product liability cases could establish major legal precedents for crypto hardware wallet makers.　　Users Prepare To Exert Legal Action Against Coinkite Over Coldcard Vulnerability　　Coinkite, the company behind the Coldcard series of hardware wallets, might face legal action from users who have collectively lost over 1,300 BTC linked to the vulnerability in the seed phrase generator used by some of its models.　　Thomas Braziel, founder and managing partner of 117 Partners, is studying how to act against the company, mentioning targeting product liability claims and even pursuing a class action lawsuit against the manufacturer.　　Braziel is currently coordinating and gathering information from victims internationally before embarking on these actions.　　Discover more　　stochastics　　Engineering it has no sales volume, despite being the largest in this matter of self-custody; in the real world outside of bitcoin, it represented nothing, a tiny company,”he told Livecoins.　　Opinions are divided on whether Coinkite might be held liable for these losses. Cris Carrascosa, CEO of ATH21, a legal firm, stressed that Coinkite had “zero regulatory responsibility over the funds of the users of

08-03Industry

Minnesota Ban Nudify Apps: Court Upholds Law Amid xAI Challenge

A federal judge has cleared the way for Minnesota‘s Minnesota ban nudify appslaw to take effect, rejecting an eleventh-hour attempt by Elon Musk’s xAI to freeze the rule before it became binding on August 1. U.S. District Judge Donovan Frank denied the companys request for a temporary restraining order, a ruling that hinged less on the merits of the law itself and more on how late xAI moved to challenge it.　　Key takeawaysJudge Donovan Frank denied xAI‘s bid to block Minnesota’s first-in-the-nation ban on “nudify” technology just before it took effect on August 1, 2026.Frank said xAI waited nearly three months after the law was signed and filed its emergency motion only three days before the deadline, undercutting claims of urgent harm.xAIs underlying lawsuit continues and argues the law is overinclusive, covering constitutionally protected images while less restrictive options exist.The law carries a penalty of $500,000 per violationand followed a backlash after xAIs Grok chatbot was used to generate non-consensual sexualized images on the platform X.　　Court denies xAI‘s bid to block Minnesota’s nudify app ban　　Judge Frank‘s ruling makes clear that Minnesota’s crackdown on nudify appscan move forward while the broader legal fight plays out in court. The decision doesn‘t resolve whether

08-03Industry

The future of crypto payments won't include on-ramps or bridges, Fun CEO says

While those applications have become increasingly visible, the infrastructure that enables deposits, withdrawals and settlement has largely remained behind the scenes.　　Fun is one of the companies building that infrastructure. The firm said it powers 100% of deposits and withdrawals on Polymarket and deposit flows into Aaves largest vaults, while processing more than $3 billion in monthly transaction volume.　　The company has raised more than $75 million to date.　　From payment rails to funding flows　　Fine said todays crypto payments ecosystem remains unnecessarily fragmented, with developers forced to stitch together different card processors, banking partners, crypto assets, blockchains and bridges to create funding experiences.　　Instead of relying on individual payment rails, platforms should optimize around the end goal of getting users funded as quickly and seamlessly as possible, he says.　　“In Web2, payments are highly fungible,” Fine said. “In Web3, theyre much more complex because every payment method behaves differently. Teams keep rebuilding the same infrastructure over and over again instead of building unified optimized funding flows.”　　That shift means many existing crypto payment businesses risk becoming obsolete, according to Fine. Companies built around converting fiat into crypto or moving assets between blockchains are solving an intermediary step that users never cared about in the first place,

08-03Industry

Another crypto wallet pulls the plug tomorrow with no exact cutoff, leaving users racing to rescue tokens

Ctrl Wallet users have reached the apps last scheduled day of full service. On Aug. 3, sending, receiving, swaps, and dApp connections are due to stop, leaving recovery-phrase export as the only function.　　Ctrl markets the non-custodial wallet as supporting more than 2,500 blockchains. Its deprecation notice says installed copies keep all functions through Aug. 2. The notice lists calendar dates only. A timezone and exact cutoff hour are absent, so waiting for a particular time on Monday risks missing the transfer window.　　The deadline changes the app interface. Ownership stays on-chain, and the recovery phrase remains the key that can reopen the same accounts in another compatible wallet.　　Access through the installed app carries a second clock. Ctrl cannot promise that a copy will keep opening after Aug. 3, and the company cannot recover a lost phrase. Users who wait could lose their working route into those accounts if the app later stops opening.　　Ctrl markets the wallet as trusted by more than 600,000 people. A verified tally of active or affected users is unavailable.　　Move the wallet, keep the phrase private　　Users have two routes. Export the 12- or 24-word recovery phrase and import it into a compatible wallet, or send assets to addresses

08-03Industry

XRP extends the longest active ETF inflow streak in crypto as rival funds struggle for fresh cash

XRP funds led altcoin inflows in July, extending a four-month streak that increasingly separates them from most rival products.　　The US-listed funds attracted $27.29 million during the month, nearly twice Solanas $14.62 million intake, according to SoSoValue data. Chainlink followed with $4.54 million, while Hedera products added $3 million.　　Bitcoin and Ethereum remained the dominant crypto fund categories, attracting $172 million and $365 million, respectively. Among products tracking assets outside the two market leaders, however, XRP finished July comfortably ahead.　　XRP builds the steadiest demand as Solana and Hyperliquid gain ground　　XRP funds have become the altcoin ETF markets most consistent source of new capital, ranking first or second in monthly inflows since April and avoiding a single monthly outflow over that period.　　Indeed, XRP funds attracted $81.59 million in April, $131.94 million in May, $59.46 million in June and $27.29 million in July. The four-month run has added more than $300 million and lifted cumulative inflows to roughly $1.5 billion, the largest total among altcoin products.　　Crypto ETF Products Monthly Flow (Source: SoSoValue)　　This run also gives XRP the longest active monthly inflow streak across the crypto funds tracked by SoSoValue this year.　　However, that lead is becoming more competitive. Solana funds have accumulated about $1.15 billion

08-03Industry

Counting down the days: State of Crypto

Senators Ruben Gallego and Thom Tillis sent a proposed revised ethics provision to the White House on Thursday, after drafting the compromise the day before, an industry source familiar with the talks told CoinDesk. As of midafternoon on Friday, the White House had not officially responded to the proposal.　　Ethics remains the biggest outstanding issue to be resolved before the Clarity Act can advance. There are ongoing negotiations around other issues, including stablecoin reserves and yield, law enforcement authorities and some of the Agriculture Committee provisions addressing the Commodity Futures Trading Commissions total remit, but these are relatively uncomplicated compared to ethics, two industry sources said. One added that they expected those other issues to be resolved relatively quickly should negotiators come to a deal on ethics.　　If the White House signs off on the counter-proposal from Tillis and Gallego, that could speed the way to at least the first part of the cloture process, the other source told CoinDesk. The Senate would still need to follow the cloture process laid out in last weeks edition of this newsletter, but the timelines involved mean that it would be difficult to get the bill all the way through by the end of the

08-03Industry

Strategy keeps STRC dividend at 12% below $90

Strategy Inc. kept the annual dividend rate on its STRC preferred stock at 12% for August 2026, even though the Nasdaq-listed security ended July more than 10% below its $100 stated amount.　　Summary12% annualized dividend remains unchanged for August despite STRC closing July at $89.46 per share.$3.75 billion reserve covers roughly 2.1 years of preferred dividends and debt interest payments currently.Strategy repurchased 288,930 STRC shares below par while retaining $975 million in remaining authorization capacity.　　The companys official STRC information page confirms that the variable annualized rate for record dates beginning in August remains 12%. Executive Chairman Michael Saylor promoted the product on Aug. 1 as a way to “stretch your income,” emphasizing its twice-monthly payment schedule.　　STRC closed at $89.46 on July 31, down $0.25 during the session. At that price, the $12 annualized payout based on the securitys $100 stated amount produces an effective yield of about 13.41%. Because Saylor announced the unchanged rate during the weekend, no post-announcement market reaction will be available until Nasdaq trading resumes.　　You might also like:　　Bitcoin ETFs gain fresh case after $89M Coldcard drain, says Balchunas　　Strategys STRC dividend no longer rises automatically　　Strategy raised STRCs annual dividend from 11.5% to 12% for record dates beginning in July.

08-03Industry

BNB Chain pursues legal action after ex-employees memecoin launch

BNB Chain, the blockchain ecosystem behind the BNB cryptocurrency, said it is pursuing legal action after a former employee allegedly used unauthorized access to a wallet to launch a memecoin.　　In an X post on Saturday, BNB Chain said the wallet was originally created for a video tutorial explaining how to launch tokens on BNB Chain. It said the former employee, who was not named in the message, retained unauthorized access to the wallets seed phrase after leaving the company and later used the address to create a new token.　　Blockchain analytics platform Lookonchain subsequently alleged that the former employee deployed a meme token called Asteroid Shiba (ASTEROID) and used four newly created wallets to buy 796.7 million tokens, representing 79.67% of the total supply. Lookonchain further alleged that the wallets later sold 718.8 million tokens for 1,103 BNB, worth about $638,000 at the time of the transaction.　　“BNB Chain did not create, authorize, promote or participate in the creation of this token and has no control over the token or wallet address,” BNB Chain said.　　Binance founder and former CEO Changpeng “CZ” Zhao shared BNB Chains statement on X and wrote that the former employee was “basically a scammer,” while advising users to

08-03Industry

Strategy leaves preferred STRC dividend at 12% as price still below par

While Strategys preferred STRC shares ended July well below their $100 par value, investors were told that their August dividend will not increase, holding at 12%.　　Executive chairman Michael Saylor delivered the news in a tweet on Saturday, continuing to pitch STRC as a way to “stretch your income.” August will be the second month that the dividend will be paid semi-monthly after shareholders approved that change in June.　　STRC shares closed at $89.46 on Friday, clocking a 5.42% price increase for the month which began with a dividend hike — 50 basis points to 12% — after a poor stock performance in June. The volume on the Nasdaq-traded shares on Friday were about two-thirds of their daily average.　　STRC shares continued to trade significantly below their $100 par value in July.　　Source: TradingView　　On Friday, Strategy CEO Phong Le reiterated that managements “corporate objective is for STRC to trade at $99-$100 over time,” without elaborating when investors might expect that to transpire.　　Related: Bitcoin ETFs end July in the green despite late-month selling　　Building cash reserve to make preferred payouts　　Saylor, however, did take to social media on Sunday to dangle the possibility that the company will be making an announcement of a change in its Bitcoin

08-03Industry

Coldcards $89M wallet bug triggers the biggest Bitcoin movement since FTX and completely distorts market signals

Coldcards wallet crisis has shaken Bitcoin sentiment, blurred on-chain signals and exposed a recurring weakness in AI-assisted cyber defenses.　　On July 30, hardware maker Coinkite warned users that wallets generated with affected Coldcard firmware could be drained because a software error produced seed phrases with far less randomness than intended.　　This security incident, Galaxy Research said, resulted in three suspected attack waves that targeted 4,585 addresses and drained 1,367.05 BTC, worth about $89 million.　　Coldcard Bitcoin Wallet Hack (Source: Galaxy Research)　　The Bitcoin associated with the three identified waves remains in attacker-controlled addresses, according to Alex Thorn, Galaxy Digitals head of firmwide research.　　However, he said smaller opportunistic thefts were already moving through peel chains, cross-chain services and offshore casinos.　　Coldcard migrations blur Bitcoins bearish signals　　This escalating threat has pushed potentially exposed users to move their Bitcoin before attackers reach it.　　Although Coinkite has released fixed firmware for affected models, existing affected seed phrases cannot be repaired through an update, leaving holders to generate new wallets and transfer their funds to secure addresses.　　That migration has produced an unusual surge in activity among smaller holders and long-dormant coins.　　CryptoQuant research head Julio Moreno said transactions involving outputs of less than 1 BTC reached 39,600 BTC on July 31. That

08-03Industry

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