Galaxy

2026

Ethereum

Bitcoin

<p>With the US Congress entering the final stretch of its legislative calendar, the odds of the proposed CLARITY Act have dropped sharply—according to Galaxy Digital’s Alex Thorn, down to just 10% for passage in 2026 from a much higher estimate in May. The change underscores how fragile the bill’s political pathway has become, and what could follow if lawmakers fail to deliver “rules of the road” for crypto markets.</p><p>As the clock tightens, attention is shifting toward regulatory contingency plans. If CLARITY does not advance, the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) are expected to move independently—while crypto firms and major industry stakeholders continue pushing for coordinated outcomes. Separate threads are also unfolding across cyber defense, prediction-market oversight, <a class="thirstylink" href="https://coinstats.app/coins/ethereum/" rel="noopener noreferrer nofollow">Ethereum</a>’s post-quantum roadmap, and stablecoin auditing.</p><h2 id="key-takeaways">Key takeaways</h2><ul><li>Galaxy Digital cut its CLARITY Act passage estimate for 2026 to 10%, down from 75% in May, citing unresolved political issues and limited Senate time.</li><li>The Senate reconvenes on Sept. 14 with only 14 days in session, making the bill’s timeline dependent on near-immediate procedural momentum after return.</li><li>If CLARITY fails, the SEC and CFTC are positioned to issue their own crypto-market frameworks, raising the risk of overlapping or inconsistent rules.</li><li>Crypto companies have asked frontier AI labs for earlier access to more capable cybersecurity models for <a class="thirstylink" href="https://coinstats.app/coins/bitcoin/" rel="noopener noreferrer nofollow">Bitcoin</a> developers, amid continuing wallet breach incidents.</li><li>Regulation of prediction markets remains fragmented, with the CFTC pushing back against state restraints while courts and local bodies challenge the boundaries of federal versus state authority.</li></ul><h2 id="clarity-timeline-tightens-as-passage-chances-fall">CLARITY timeline tightens as passage chances fall</h2><p>Galaxy Digital’s research head Alex Thorn said the probability of the CLARITY Act passing in 2026 is now “just 10%.” In May, Thorn’s estimate was far higher at 75%, reflecting how quickly political momentum has eroded as negotiations encountered unresolved issues.</p><p>One core constraint is the Senate calendar. According to the reporting cited in the source, the Senate will have only 14 days in session after reconvening on Sept. 14. That leaves little room for delays unless lawmakers move quickly on procedural steps, including an initial motion to proceed immediately upon return. Thorn’s view, as stated, is that the bill would need to effectively take over the working session to pass within the window.</p><p>The stakes are not only legislative but regulatory. If CLARITY does not advance, the SEC and CFTC plan to step in with their own rulemaking for crypto markets—an outcome Thorn and others appear to view as less desirable than a single comprehensive framework. The SEC, for its part, had scheduled an open meeting to outline a path toward clearer “rules of the road,” but the meeting was canceled due to an “unforeseen scheduling issue,” according to the source.</p><p>There are also indications of political sensitivity around the sequencing of agency action. The White House was reportedly unhappy that the SEC might effectively go “rogue” on crypto rules, potentially complicating delicate negotiations to get CLARITY over the line.</p><h2 id="high-level-coordination-attempts-to-keep-clarity-alive">High-level coordination attempts to keep CLARITY alive</h2><p>Despite the reduced odds, stakeholders appear to be mobilizing around a final push. The source notes that SEC Chair Paul Atkins, President Donald <a class="thirstylink" href="https://med.etoro.com/B10215_A127826_TClick_Scb-trump.aspx?TargetURL=https://www.etoro.com/markets/trump" rel="noopener noreferrer nofollow">Trump</a>, and representatives from major crypto-adjacent institutions—including <a class="thirstylink" href="https://med.etoro.com/B10215_A127826_TClick_Scb-coinbase.aspx?TargetURL=https://www.etoro.com/markets/coin" rel="noopener noreferrer nofollow">Coinbase</a>, a16z, <a class="thirstylink" href="https://coinstats.app/coins/ripple/" rel="noopener noreferrer nofollow">Ripple</a>, <a class="thirstylink" href="https://med.etoro.com/B10215_A127826_TClick_Scb-Chainlink.aspx?TargetURL=https://www.etoro.com/markets/link" rel="noopener noreferrer nofollow">Chainlink</a>, NYSE, and <a class="thirstylink" href="https://med.etoro.com/B10215_A127826_TClick_Scb-nasdaq.aspx?TargetURL=https://www.etoro.com/markets/nsdq100" rel="noopener noreferrer nofollow">Nasdaq</a>—are expected to meet at the White House on Wednesday to discuss crypto regulation and ways to advance the bill.</p><p>The following day, the CFTC is scheduled to convene its new Innovation Advisory Committee to discuss regulation of crypto alongside AI and prediction markets. In practice, these parallel calendars reflect a dual-track posture: one aimed at passing CLARITY, and another preparing for continued regulatory work irrespective of whether Congress succeeds.</p><p>For investors and market participants, the immediate question is not whether enforcement will continue, but how predictable it will be. A comprehensive statute could reduce uncertainty around classification and jurisdiction. A patchwork approach—created by separate SEC and CFTC rulemaking—could increase compliance complexity, particularly for businesses straddling securities and commodities characterizations.</p><h2 id="cybersecurity-push-grows-as-more-ai-enabled-threats-emerge">Cybersecurity push grows as more AI-enabled threats emerge</h2><p>Beyond Washington, the crypto ecosystem is responding to evolving threat models—especially those shaped by increasingly capable AI systems. Multiple cryptocurrency firms, including Anchorage Digital, BitGo, Bitwise, Blockstream, <a class="thirstylink" href="https://ledger.pxf.io/gO5AdA" rel="noopener noreferrer nofollow">Ledger</a>, and <a class="thirstylink" href="https://trezor.go2cloud.org/aff_c?offer_id=133&amp;aff_id=5607&amp;source=cryptobreaking" rel="noopener noreferrer nofollow">Trezor</a>, urged frontier AI labs to provide <a class="thirstylink" href="https://coinstats.app/coins/bitcoin/" rel="noopener noreferrer nofollow">Bitcoin</a> developers with early access to top-tier models.</p><p>The push is described in an open letter published by the Bitcoin Policy Institute. The letter argues that public frontier systems may impose guardrails that restrict defenders, forcing developers to rely on less capable open-weight models rather than tools closer to what attackers can use.</p><blockquote><p>“Without dedicated access programs, defenders may lack the tools needed to keep pace with evolving threats to the infrastructure they maintain.”</p></blockquote><p>The source links this urgency to recent incidents, including a reported $116 million theft from Coldcard hardware wallets, followed by a “Bitcoin Red Team” effort that used AI to identify thousands of potential cybersecurity issues using open-source Chinese models. It also points to ongoing data exposure risks affecting wallet users.</p><p>According to the source, <a class="thirstylink" href="https://trezor.go2cloud.org/aff_c?offer_id=133&amp;aff_id=5607&amp;source=cryptobreaking" rel="noopener noreferrer nofollow">Trezor</a> reported a data breach involving personal details of roughly 14,000 users through its shipping provider ShipMonk, with customers at higher risk for phishing attacks if they received products in multiple listed regions between May 10 and Aug. 8. Separately, SafePal disclosed a breach affecting nearly 40,000 users’ order information, including names, addresses, and purchasing data, and reported taking down fraudulent websites and phishing links tied to the incident.</p><p>What to watch here is whether the request for AI access translates into concrete programs for defenders—because the gap between attacker capability and defensive tooling can directly affect the speed at which vulnerabilities are identified and mitigated.</p><h2 id="prediction-markets-face-continued-federal-state-friction">Prediction markets face continued federal-state friction</h2><p>Prediction market regulation remains a live battlefield between federal oversight and state restrictions. The CFTC ordered prediction market platform Kalshi to disregard a restraining order in New York and continue operating normally, calling New York’s enforcement action a “market emergency” because it could prevent Kalshi from operating nationally.</p><p>The CFTC’s reasoning, as cited in the source, centers on the view that the Commodity Exchange Act requires a uniform national derivatives market. CFTC Chair Michael Selig said Congress did not intend derivatives exchanges to face a “patchwork” of state gaming laws.</p><p>However, the regulatory conflict is far from settled. A Washington state judge later ordered Kalshi to stop operating in Washington and rejected Kalshi’s argument that federal commodities law preempts Washington’s gambling law. The source says Kalshi was ordered to implement IP-address and residency-based geofencing by Aug. 19 and a GeoComply multi-source geofencing system by Sept. 2.</p><p>Meanwhile, local-level scrutiny is also growing: the New York City Council launched an investigation into prediction market firms to examine whether influencer-driven marketing uses “false and deceptive” tactics targeting young adults, according to the source.</p><p>For platforms, compliance strategy may increasingly hinge less on one-time legal outcomes and more on the operational reality of jurisdiction-by-jurisdiction constraints—especially where geofencing becomes a workaround rather than a definitive legal solution.</p><h2 id="ethereum-narrows-its-post-quantum-choices-and-refocuses-hegot-scope">Ethereum narrows its post-quantum choices and refocuses Hegotá scope</h2><p>On the network development front, the <a class="thirstylink" href="https://coinstats.app/coins/ethereum/" rel="noopener noreferrer nofollow">Ethereum</a> Foundation is adjusting its post-quantum architecture. Researcher Justin Drake said the foundation is moving away from the Poseidon hash function in its plan, instead leaning on established alternatives such as SHA or BLAKE.</p><p>The source frames the rationale around recent progress: Poseidon is designed to work well with zero-knowledge proofs and can help compress post-quantum signature sizes, but Drake argued that developments mean SNARKs can be tailored to work better with existing hash functions.</p><p>According to the same reporting, Ethereum is targeting a production-ready “leanVM” for 2027, with deployments across Ethereum’s consensus, data, and execution layers in 2028. Separately, developers are reviewing 66 proposals to narrow scope for the next major upgrade after “Glamsterdam,” referred to as Hegotá.</p><p>The source notes that the censorship-resistance proposal FOCIL is currently the only Ethereum Improvement Proposal scheduled for inclusion, with several other EIPs focused on privacy. Developers are aiming to ship Hegotá next year, while Glamsterdam is expected in the coming months.</p><h2 id="tether-completes-first-full-financial-audit-with-clean-kpmg-opinion">Tether completes first full financial audit with clean KPMG opinion</h2><p>In stablecoin auditing, Tether announced it has completed the first full independent audit of its annual financial statements. The source says KPMG US issued a clean opinion on Tether’s 2025 accounts, covering the year ended Dec. 31, 2025, including balance sheet items, income statement figures, cash flows, and the assets purportedly backing issued tokens.</p><p>Tether also stated that the audited statements showed reserves exceeding liabilities by $6.814 billion. The source emphasizes that this full audit differs from Tether’s quarterly reserve attestations by subjecting broader financial statements and underlying evidence to independent examination.</p><p>For market participants, the practical value is not in the audit’s existence alone but in what an audited process adds to transparency: independent verification of the evidence and the full set of financial statements, rather than periodic reserve-focused attestations.</p><p>Looking ahead, the biggest variable remains congressional timing: whether CLARITY can gain enough procedural momentum before the Senate’s short September window closes. At the same time, the regulatory direction agencies choose if Congress falls short—and how quickly firms respond with security and compliance tooling—may matter as much to real-world operations as any eventual statute.</p><p>This article was originally published as <a href="https://www.cryptobreaking.com/54000-wallet-records-leaked-as/?utm_source=rss&amp;utm_medium=syndication&amp;utm_campaign=article_footer" rel="noopener noreferrer nofollow">54,000 Wallet Records Leaked as CLARITY Odds Drop to 10%: Digest</a> on <a href="https://www.cryptobreaking.com/?utm_source=rss&amp;utm_medium=syndication&amp;utm_campaign=article_footer" rel="noopener noreferrer nofollow">Crypto Breaking News</a> – your trusted source for crypto news, Bitcoin news, and blockchain updates.</p>

54,000 Wallet Records Leaked as CLARITY Odds Drop to 10%: Digest

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