Hi! In today’s edition:
🟢 An inflation print finally broke the right way, and Bitcoin took notice.
🎖️ The White House's lead crypto negotiator is stepping away just as his biggest fight approaches a critical juncture.
🇬🇧 Washington and London agree to start writing tokenization rules from the same page.
⚖️ The CFTC just told a state court it can't unwind prediction market trades that already cleared.
Bitcoin Gets Relief as Inflation Cracks
Bitcoin climbed back above $65,000 on Tuesday after U.S. June inflation data came in far cooler than expected, easing fears that the Fed will hike rates this month. Ether, meanwhile, outran bitcoin, jumping nearly 7% to around $1,895.
Consumer prices fell 0.4% in June, the biggest one-month drop since April 2020, against forecasts of a 0.2% decline. Annual inflation slowed to 3.5% from 4.2%, the first cooldown in five months.
The driver was energy: gasoline fell over 9%, unwinding some of the spike tied to the US-Iran conflict.
Traders now lean toward the Fed holding rates at 3.5% to 3.75% later this month, though a September hike is still on the table. The overhang: the US military said it was preparing to reimpose a blockade on Iranian ports, keeping the energy risk that drove inflation in the first place very much alive.
The White House's Crypto Dealmaker Is Leaving
Patrick Witt, the White House's top crypto negotiator, is stepping away just as the fight he's been leading appraches critical juncture. Witt, who runs the administration's crypto council and has been the chief dealmaker on the Clarity Act, reports for Army National Guard training on July 27, according to Crypto in America.
Witt put in for the program last spring and deferred once to stay at the Clarity Act negotiating table; the Army wouldn't allow a second delay, Crypto in America reported. His deputy Harry Jung, who sat in on many of the same talks, is expected to take over, and Witt plans to stay involved as his schedule allows, according to the report.
The market structure bill has roughly three weeks to clear the Senate before the August recess, and a fight over ethics language tied to President Trump's crypto income remains unresolved.
Washington and London Sync Up on Tokenization
The US and UK laid out a joint plan Tuesday to make it easier for tokenized assets and stablecoins to move between the world's two largest financial centers. The Treasury and HM Treasury published recommendations from a transatlantic task force, aimed at cutting the regulatory friction that slows tokenized securities and cross-border stablecoins and backing the private sector's role in digital money.
The report maps where regulators including the SEC, CFTC, the UK's FCA, and the Bank of England plan to coordinate, from settling tokenized securities to letting stablecoins and tokenized money market funds serve as collateral.
Treasury Secretary Scott Bessent framed it as a bet on both markets' strength and shared standards.
CFTC Blocks Kalshi From Canceling Michigan Trades
The CFTC stepped between Kalshi and a Michigan court on Tuesday, ordering the prediction market not to cancel trades that a state judge had told it to void. Michigan's attorney general won an order in June halting Kalshi's sports contracts as illegal gambling, and the court directed the firm to refund certain Michigan users.
Kalshi asked the CFTC how to respond; the agency told it to honor the trades. CFTC Chair Mike Selig said no state can force a federally regulated exchange to unwind executed trades, calling it an unprecedented step with broad market implications.
Michigan is the first state to try interfering with trades directly, but it's not alone in the broader fight: the CFTC has sued nine states over efforts to restrict event contracts, and the jurisdiction question looks headed for higher courts.
⚖️ Senate Democrats came out against the CLARITY Act at a Capitol Hill press conference, with Chris Van Hollen branding the market structure bill "a corrupt piece of legislation" and Chris Murphy and Jeff Merkley tying their opposition to President Trump's crypto profits. The stand hardens the math on a bill that needs at least seven Democratic votes to clear the Senate.
🏦 Bank trade groups led by the ABA urged Senate leaders to tighten the CLARITY Act's stablecoin yield language, warning that Section 404 is too loose and could drain deposits from community banks. A May letter from the sector estimated the change could cut consumer, small business, and agricultural lending by a fifth or more.
🤖 Visa, Mastercard, and Ripple push the number of companies governing x402, the Coinbase-built standard that lets software agents pay each other in stablecoins like USDC, to 40. The protocol moved about $24 million across roughly 75 million payments in the past month, an average of 32 cents each.
🇪🇺 The ECB selected 36 firms, including Deutsche Bank, Revolut, and Adyen, to test a beta digital euro in a 12-month pilot starting in the second half of 2027. The central bank is racing to counter dollar-pegged stablecoins it views as a threat to Europe's monetary sovereignty.
🇬🇧 HMRC will treat UK crypto lending and liquidity pool transactions as "no gain, no loss," deferring capital gains tax until an actual disposal. The change takes effect in April 2027 and is expected to affect about 700,000 people.
💸 Galaxy launched GOFR, an institutional lending program that blends borrowing rates across Aave, Morpho, Spark, and other DeFi protocols into a single managed rate, with clients facing Galaxy rather than the protocols. The firm is committing up to $100 million of its own capital as first-loss protection, with a $1 million minimum loan size.
🔒 EthSystems spun out of the Ethereum Foundation as a for-profit startup building confidentiality tools for banks that use Ethereum, commercializing work on private stablecoin transfers and bond issuance. The company joins EF spinouts EthLabs and Ethereum Institutional, and is backed by BitMine, SharpLink, and co-founder Joseph Lubin.
📊 Binance marked nine years by claiming 323 million users and more than $156 trillion in lifetime volume, while pushing its "financial super app" strategy with tokenized stocks.
🇯🇵 JCB, Japan's largest card network, signed an MOU with Circle to explore using USDC for cross-border payments and in-store transactions across its 40 million merchants worldwide. The first step is a proof of concept for JCB's own internal fund transfers, part of a broader stablecoin push in Japan.
💰 CleanSpark signed a 20-year lease worth about $6.6 billion in contracted revenue with an unnamed investment-grade global tech firm for its data center campus in Sandersville, Georgia. The deal, which could reach $11.6 billion with extensions, deepens the bitcoin miner's pivot into AI and high-performance computing infrastructure.
💸 Nous Research is raising $75 million at a $1.5 billion valuation in a round led by Robot Ventures with participation from USV, according to TechCrunch. The startup builds the open-source Hermes AI agent and had previously raised about $70 million.
💰 Velocity raised $38 million in a Series A led by Dragonfly and FirstMark, with backing from Coinbase Ventures, Ripple, QED Investors, and Capital One Ventures. The London startup builds stablecoin treasury and settlement infrastructure for enterprises, bringing its total raised to nearly $50 million.
💸 Tether led a $7 million Series A in Pact Labs, with participation from Blockchange Ventures and Lasagna, to expand its US-regulated USA₮ stablecoin into payroll and earned wage access. CEO Paolo Ardoino framed the bet as a "wages story," targeting a US payroll system that moves over $11 trillion a year.
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