The fallout from one of crypto’s most high-profile security breaches has gone international. Coinbase Chief Executive Officer Brian Armstrong said a former customer service agent was arrested in India, months after hackers bribed support staff to gain access to sensitive customer information at the largest U.S.-based crypto exchange.

The arrest stems from a breach disclosed in May, according to Bloomberg News. Coinbase revealed that attackers had paid contractors or employees outside the United States to steal customer data and then attempted to extort the company for $20 million. At the time, the San Francisco-based exchange warned the incident could cost as much as $400 million to remediate, making it one of the most expensive security episodes in the crypto industry to date.

A Coinbase spokesperson confirmed the arrest in India and said it followed cooperation with U.S. law enforcement, including recent work with the Brooklyn District Attorney’s Office. In a related case, prosecutors charged a Brooklyn man accused of running what authorities described as a “long-running impersonation scheme targeting Coinbase customers,” underscoring how compromised data can fuel downstream fraud long after an initial breach.

The incident highlights a persistent vulnerability for crypto platforms: human access points. While exchanges have invested heavily in technical safeguards, attackers increasingly exploit customer support channels, particularly when outsourced overseas, to bypass more sophisticated defenses.

Investors appeared largely unfazed but cautious. Coinbase shares fell about 1.2% to $236.79 on Friday, extending the stock’s year-to-date decline to roughly 4.6%. Still, the case serves as a reminder that as crypto firms push toward mainstream adoption, operational security—and oversight of third-party contractors—remains as critical as code.

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Crypto prices today were largely flat as traders stayed defensive ahead of a record options expiry later this week.

The total crypto market cap slipped 0.8% to $3.07 trillion. Bitcoin traded at $88,088 at press time, down 0.7% over the past 24 hours. Ethereum fell 1% to $2,987, while Chainlink eased 0.6% to $12.49 and Sui dipped 0.4% to $1.45. Smaller altcoins like Zcash, Monero, and Ethena saw declines of more than 5%.

Market sentiment remained fragile. The Crypto Fear & Greed Index fell one point to 24, keeping the market firmly in extreme fear.

CoinGlass data showed stress building beneath the surface. 24-hour liquidations jumped 11% to $222 million, while total crypto open interest rose 1.1% to $129 billion. Despite the weak price action, the average market relative strength index was 47, indicating neutral momentum. 

Options expiry keeps prices locked in range

Traders are preparing for a major options expiry, with between $27 billion and $28.5 billion in Bitcoin and Ethereum contracts set to expire on Deribit on Dec. 26. Bitcoin options account for roughly $23.6 billion, while Ethereum options make up about $3.8 billion, marking the largest expiry in the exchange’s history.

Options give traders the right to buy or sell at a set price. When a lot of contracts stack up around key strike levels, market makers often hedge their exposure through spot market trades.

Until the options expire, this hedging may keep prices fixed. While underlying volatility has been building, price action has remained relatively tight due to heavy positioning around major Bitcoin strike prices. Many traders are holding off on new trades and waiting to see how the market behaves after the expiry.

Thin liquidity shapes short-term outlook

Another level of caution is being added during the holiday season. December usually sees lower volume because traders cut their exposure and funds close their books. Bitcoin is already down roughly 28–30% from its October peak above $125,000, and the market is still digesting that drawdown.

Macro conditions have not helped risk appetite. The Bank of Japan’s rate hike to 0.75% has tightened global liquidity and pressured risk assets, including crypto. As investors shift to safer assets, gold and silver have reached all-time highs, while U.S. equity market has declined due to worries about AI-related tech stock valuations.

In the short term, Bitcoin appears stuck in consolidation. As long as options positioning remains heavy, large moves are unlikely. A clean break may come after Dec. 26, when hedging pressure fades. Until then, price action points to choppy trading with downside risk capped near recent lows, unless liquidation pressure accelerates.

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European Union governments have agreed on a common position for the digital euro, marking a significant step toward strengthening the bloc’s monetary sovereignty and reinforcing the euro’s role in global finance amid the prominence of U.S. dollar-denominated stablecoins.

“The digital euro is an important step toward a more robust and competitive European payment system, and can contribute to Europe’s strategic autonomy and economic security,” Danish Economy Minister Stephanie Lose said Friday, noting Denmark currently holds the Council’s rotating presidency.

The EU Council’s mandate emphasizes that both online and offline versions of the digital euro are essential and should be available from the initial issuance, aligning with the European Central Bank’s (ECB) stance. This contrasts with proposals from some lawmakers, including Fernando Navarrete, who suggested an online-only model if the private sector provides alternatives.

The ECB launched its digital euro initiative in 2021, and the European Commission submitted a proposal in 2023. Member states took over two years to reach agreement on a common approach. The next step requires the European Parliament to finalize its position before formal negotiations with the Council can begin.

Provided an agreement is reached next year, the ECB may launch a pilot phase in 2027, with a potential full rollout targeted for 2029, according to Bloomberg. EU officials have highlighted concerns about over-reliance on U.S. payment firms such as Visa, Mastercard, and PayPal, as well as the potential entry of stablecoins promoted by U.S. interests.

To safeguard financial stability, governments stressed the importance of customer holding limits, previously agreed upon by euro-area finance ministers, which envision close cooperation between the ECB and the Council. The Council also outlined a framework for compensating payment service providers, including capped interchange and merchant fees during a transitional five-year period, with fee caps thereafter based on actual digital euro costs.

With these steps, the EU is moving closer to creating a digital currency framework that balances innovation, security, and strategic autonomy for the eurozone.

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A long-awaited decision in Washington is now set to reshape leadership at the U.S. derivatives regulator.

A leadership change at a key U.S. market regulator is now set.

Michael Selig was confirmed by the U.S. Senate on Dec. 18 and will soon be sworn in as the 15th chairman of the Commodity Futures Trading Commission, ending nearly a year of interim leadership at the agency.

A familiar figure returns as CFTC chairman

Selig is no stranger to the regulator he will now lead. He began his career at the CFTC in 2014 as a law clerk to then-Commissioner Christopher Giancarlo, who later became chairman. After leaving the agency, Selig spent several years in private practice, advising trading firms, exchanges, and digital asset companies on compliance with U.S. securities and commodities laws.

He returned to government earlier this year as chief counsel to the Securities and Exchange Commission’s Crypto Task Force, where he served as a senior advisor to Chairman Paul Atkins. That role placed him at the center of inter-agency discussions on how digital asset markets should be supervised.

Selig will take over from Caroline Pham, who has served as acting chair for much of 2025 and, for several months, was the CFTC’s only Senate-confirmed commissioner.

Enforcement priorities and crypto policy ahead

During his confirmation hearing, Selig made clear that he favors a lighter regulatory touch where possible. He argued that enforcement actions focused on minor technical issues can drain resources and push legitimate businesses offshore, without improving market integrity.

At the same time, he said the CFTC must remain active against fraud, manipulation, and abuse. In his words, the agency should still act as “a cop on the beat,” with enforcement aimed at conduct that causes real harm.

That approach closely tracks the direction set under Pham. Over the past year, the CFTC narrowed its enforcement focus, reduced emphasis on paperwork violations, and shifted resources toward complex fraud and retail harm. The agency also updated its investigation rules to give firms more transparency and time during enforcement proceedings.

On crypto, Selig is expected to continue the CFTC’s recent push to bring more activity onshore. The agency has already moved ahead with pilot programs covering tokenized collateral and listed spot crypto products on regulated exchanges. Selig has previously supported clearer market structure rules and closer coordination with the SEC, Treasury, and banking regulators.

His confirmation comes as Congress debates legislation that could give the CFTC primary oversight of spot crypto commodity markets. If passed, those laws would expand the agency’s role at a moment when digital asset oversight is still taking shape.

For now, Selig steps into the job with a full agenda and little runway. How quickly policy turns into action will be closely watched by both traditional markets and crypto firms alike.

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Japan’s push into regulated digital finance continues as SBI Holdings and Startale move to issue a yen-denominated stablecoin for global payments in 2026.

Japan’s push toward regulated digital finance is set to take a new step with plans for a fully compliant yen-backed stablecoin for both domestic and global use.

The plan was confirmed in a Dec. 16 press release by SBI Holdings and Startale Group, which announced a memorandum of understanding to jointly develop and launch the stablecoin, with a target rollout in the second quarter of 2026.

A regulated digital yen built for global use

The proposed stablecoin will be issued as a Type 3 Electronic Payment Instrument under Japan’s financial framework, a structure designed to meet strict compliance standards while allowing wider flexibility than existing electronic payment tools.

Notably, this classification means the token would not be subject to Japan’s ¥1 million cap on domestic transfers and balances, a limit that applies to many other digital payment methods.

Both firms say the stablecoin is being designed for cross-border settlement, enterprise payments, and onchain activity, allowing yen liquidity to move more easily across blockchain-based financial systems. It will give global markets access to a regulated digital yen that can operate alongside traditional banking rails.

“By jointly issuing a Yen-denominated stablecoin with the Startale Group to serve as the foundation of this infrastructure, and by circulating it both domestically and globally, we aim to dramatically accelerate the movement toward providing digital financial services that are fully integrated with traditional finance.” 

— Yoshitaka Kitao, Representative Director, Chairman & President of SBI Holdings.

As per the agreement, Startale will oversee the technical implementation, which includes security systems, developer tools, smart contracts, and APIs. SBI Holdings will manage market distribution, issuance, and regulatory compliance through its financial subsidiaries. 

As a licensed cryptocurrency exchange, SBI VC Trade will facilitate circulation, while Shinsei Trust & Banking, a division of the SBI group, is expected to oversee issuance and redemption.

Part of Japan’s wider stablecoin strategy

Japan has spent the past few years tightening its approach to digital assets, with stablecoin rules that require full fiat backing and oversight by licensed banks or trust companies. That framework has made the country one of the more conservative but clearer jurisdictions for regulated stablecoins.

SBI’s involvement follows that direction. The firm has steadily expanded its footprint across digital assets, from crypto trading to tokenized securities and blockchain-based settlement systems. Partnering with Startale allows it to combine regulatory infrastructure with blockchain-native development.

The companies say the yen stablecoin could support a range of use cases over time, including tokenized real-world assets, automated onchain settlement, and payments between software agents, areas that are increasingly discussed by financial institutions exploring blockchain adoption.

The stablecoin is scheduled for launch in Q2 2026, pending final regulatory approvals and system testing. Before then, the partners plan to finalize compliance structures, expand technical integrations, and work with institutional participants to prepare for distribution.

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Analysts warn that falling Bitcoin exchange activity could make prices more fragile, even without heavy selling pressure.

Bitcoin’s price looks calm on the surface, but deeper market mechanics suggest growing fragility beneath the range.

In a Dec. 15 analysis, CryptoQuant contributor XWIN Research Japan warned that a sharp slowdown in Bitcoin (BTC) flows between exchanges is weakening internal market liquidity. This increases the risk of sudden and outsized price moves despite the lack of heavy selling pressure.

Exchange liquidity is quietly drying up

Since the start of December, Bitcoin has chopped sideways between roughly $80,000 and $94,000 after pulling back from its October peak near $126,000. While that range-bound behavior may appear constructive, on-chain data tells a more delicate story.

XWIN pointed to the Inter-Exchange Flow Pulse, a CryptoQuant metric that tracks the flow of Bitcoin between exchanges. The indicator has turned red, indicating a slower flow of capital between trading venues. 

When money flows freely between exchanges, arbitrageurs support deep order books and stable prices. However, liquidity falls when those flows decline. Once momentum builds, even relatively small trades can begin to move prices, increasing slippage and causing sharper swings.

This is unfolding at a time when Bitcoin balances on exchanges are near historic lows. While that can be supportive in quiet markets, since there’s less immediate sell pressure, it also leaves less supply available to cushion sudden buying or selling.

As XWIN notes, the concern isn’t heavy distribution right now, but a fragile market structure. With thinner buffers and leverage still in play, even small shocks can quickly turn into outsized price moves.

Derivatives data points to a reset, not panic

Separate data from another Cryptoquant contributor Arab Chain reinforces the idea that the market is cooling rather than collapsing. The combined open interest and funding Z-score for Binance derivatives metrics is close to -0.28, which is slightly below its historical average. 

That signal indicates that traders are gradually lowering leverage and overall risk rather than jumping into new speculative bets, most likely in response to previous excesses.

In the past, pullbacks often followed sharply positive Z-scores, which typically appeared during overheated runs. The current negative reading tells a different story, one of risk being slowly taken off the table as higher-risk positions are unwound over time.

Bitcoin has largely hovered around the $90,000 level, even as activity in the derivatives market cooled off. There doesn’t seem to be a wave of forced liquidations driving that pullback, but rather traders reducing their leverage.

Although this has somewhat slowed the short-term rally, many analysts see it as a positive reset rather than an indication of more serious weakness. They warn that until exchange liquidity improves, Bitcoin may continue to be susceptible to sudden movements in either direction rather than a steady trend, even though long-term supply dynamics and institutional adoption are still favorable.

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HashKey has opened subscriptions for its Hong Kong initial public offering, targeting up to $215M with backing from UBS and Fidelity in a key moment for the city’s crypto ambitions.

The exchange operator is seeking to raise as much as HK$1.67 billion, or about $215 million, in what may become one of the city’s most closely watched digital-asset listings.

A Dec. 8 Bloomberg report confirmed that the company’s subscriptions for its Hong Kong IPO are now open.

IPO opens as Hong Kong pushes for digital-asset leadership

HashKey is offering just over 240 million shares priced between HK$5.95 and HK$6.95. At the top of that range, the firm would debut with a valuation near HK$19 billion. Order books will stay open through Friday, with trading expected to begin on Dec. 17.

The offering arrives during an active stretch for Hong Kong’s IPO market, where total proceeds are tracking toward a four-year high. It also reflects the city’s continued push to position itself as a regional home for compliant crypto firms.

The exchange was one of the first companies to receive a license under Hong Kong’s digital-asset framework introduced in 2022. Since then, its activities have expanded into a larger ecosystem that includes asset management, trading, on-chain services, and venture investments.

HashKey reported platform assets of over HK$19.9 billion, support for more than 80 tokens, and cumulative spot trading volume of HK$1.3 trillion as of Sept. 30. It also held HK$1.48 billion in cash and HK$570 million in digital assets, with most of the latter in major tokens such as BTC, ETH, and USDT.

A test of confidence for Hong Kong’s crypto sector

Despite this scale, the company reported more than HK$2.3 billion in cumulative losses over the past three years. Losses in the first half of 2025 narrowed by more than a third compared with the prior year thanks to tighter cost controls and revenue tied to trading, which made up nearly seventy percent of income.

HashKey argues its ISO-certified platform, conservative risk architecture, and expanding licenses in markets such as Japan and Bermuda can help mitigate pressures facing other regional exchanges.

The IPO is also drawing attention because of its cornerstone investors. UBS’s asset-management arm, Fidelity International, and Infini Capital have each agreed to take part, committing a combined $75 million with lock-ups lasting six months. Their backing is viewed as a vote of confidence at a time when digital-asset markets remain volatile and Bitcoin is still trading below its October record.

Hong Kong has approved only a limited number of licensed crypto platforms, and inflows into the city’s digital-asset exchange-traded funds are modest compared with the U.S. HashKey’s listing may set a precedent for how web3 companies mature under the city’s rules.

It also lands as authorities advance policies on stablecoins, real-world assets, and tokenized securities, indicating a major shift toward regulated adoption. JPMorgan Chase and Guotai Junan are serving as joint sponsors for the deal.

If the listing performs well, it may encourage other crypto firms in the region to revisit public-market plans and strengthen Hong Kong’s case as Asia’s regulatory bridge between traditional finance and digital assets.

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