News Brief
Published Aug 3, 2026 11:24
News Brief

Bitcoin News - August 3, 2026 at 11:00 AM

Bitcoin News Aug 3, 2026 11:00 Scheduled 11 outlets
114Articles 114Extracted 0Failed 24.5mRuntime

Top of Mind

The Coldcard hardware wallet exploit is the dominant story. A firmware bug in Coinkite's Mk3 (and subsequently Mk4, Mk5, and Q) dating to a March 2021 code change routed seed generation to a software PRNG seeded from predictable device values (~40 bits of entropy vs. 128 intended). Galaxy Research tracked four attack waves through Monday totaling an estimated ~1,816 BTC (~$114M) across ~5,300+ addresses, with the attack ongoing. Sub-1 BTC transfers hit 39,600 BTC on July 31—the highest daily figure since the FTX collapse—as retail holders fled to exchanges and alternative custody. The attacker used a paid blockchain-services provider account (unnamed at the provider's request) and AI-assisted code analysis to brute-force keys. Coinkite has released patched firmware; existing seeds generated without 50+ dice rolls remain compromised regardless of update. The incident directly revives the self-custody vs. ETF custody debate, with Bloomberg's Balchunas citing ETF operational history as the safer alternative.

Market Structure

  • BTC near $62,700, down ~26% YTD and ~50% from the $126,080 October 2025 ATH. July closed +8.5%, the strongest July since 2022, but the month-end saw a $265M single-day ETF outflow—the largest since July 13—flipping the weekly net negative.
  • Spot Bitcoin ETFs ended July with modest $172M net inflows, reversing two months of heavy outflows ($7B combined in May-June), but remain $5.3B negative YTD. IBIT led a single-day $233M inflow on July 31. The Coinbase Premium Index hit its 77th consecutive negative day—longest streak on record—indicating persistent US institutional selling despite ETF inflows.
  • Derivatives: CME open interest near multi-year lows; perps open interest ~300K BTC; avg daily spot volume $2.2B for July. Put/call IV skew at +11.4pp (83rd percentile). Funding ~+4.5% annualized vs. +8.4% long-run avg—positioning is defensive, not capitulating. VanEck flags bottom signals unmet: skew needs to exceed +15pp or funding must flip negative.
  • Coinbase Q2: Revenue $1.2B (miss vs. $1.3B est.), net loss $359M (vs. $122M loss expected). Third consecutive miss. Shares fell 7% after-hours; now down ~57% year-over-year. Stablecoin revenue $292M; prediction market revenue up 106% QoQ.

Policy and Institutions

  • CLARITY Act stalled: Senate has days before August 7 recess. Galaxy pegs passage odds at 30%; Bitwise noted prediction markets had it at ~20%, down from 75% in May. Key sticking points: enforcement of ethics provisions (DOJ vs. state AGs), stablecoin yield objections from banks, and BRCA law enforcement language. Treasury Secretary Bessent publicly pressured the Senate to vote; Sen. Lummis blamed Democrats; Major Cities Chiefs Association endorsed latest draft. Bernstein says a failure accelerates SEC/CFTC rulemaking via "Project Crypto."
  • Trump financial disclosures: Office of Government Ethics filings show Trump earned $1.16B+ in crypto in 2025—$526.8M from World Liberty Financial token sales, $635M in "Celebration Coins" royalties. He retains ~15.75B WLFI tokens (~$900M). The figures complicate CLARITY Act ethics negotiations directly.
  • Trump Media BTC transfers: Wallets moved 2,628 BTC (~$165M) to Crypto.com. A spokesperson told The Block it was a transfer, not a sale, matching May's explanation. Remaining tagged holdings: ~4,261 BTC, nearly matching collateral pledged against convertible notes maturing May 2028.
  • Iran sanctions/Bitcoin: OFAC designated HormuzSafe and Persian Gulf Marine Insurance for accepting BTC to collect mandatory Strait of Hormuz "insurance" on behalf of IRGC. Reuters separately reported Dubai-based Shelbit processed $4B+ linking Iranian entities to Binance wallets ($676M flagged); VARA is investigating. Binance disputes the $540M post-fine figure.

Network and Industry

  • Coldcard exploit technical: Mk2/Mk3 firmware 4.0.1+ affected at ~40-bit entropy; Mk4/Mk5/Q seeds have additional secure element entropy but only ~32 bits reach PRNG state—still well below 128-bit target. Coinkite CEO acknowledged AI likely identified the vulnerability. Block's engineering team identified the attacker used a paid blockchain-services provider. Coinkite hotfix now fails the build unless the correct RNG path is linked. BIP-39 passphrase users face minimal risk.
  • Strategy Q2: $8.22B net loss driven by $8.32B unrealized BTC losses. Holds 843,775 BTC ($54.6B). Built $3.75B USD reserve; covers 2+ years of preferred dividend obligations. Saylor posted "Bitcoin Drive engaged" Sunday—possible imminent purchase after five-week pause. STRC preferred trading at $89.46 (~10.5% below par), yielding ~13.4%.
  • Miner stress: Hashprice ~$30.6/PH/day near multi-year lows; daily revenue averaged $28.5M, down 39.5% YoY. Russia's Moscow region bans mining Aug. 15 through 2032 (~1 GW affected). Hut 8 signed a second 352 MW, 15-year lease at Beacon Point, Texas (total 704 MW contracted); Benchmark raised PT to $195. AI-exposed miners (Cipher -8%, Core Scientific -9%) underperformed while crypto stocks broadly rotated higher Monday on AI capex concerns.
  • Bitcoin Optech #416: Two DoS vulnerabilities disclosed in Core Lightning (memory exhaustion via gossipd). BIP459 draft for full BIP340 Schnorr signature aggregation (DahLIAS scheme) advancing. Wasabi Wallet 2.8.0 removes centralized backend via compact block filters.

Macro Linkages

  • Fed held at 3.50–3.75% in a 9-3 vote (Hammack, Kashkari, Logan dissented for a hike—most dissents of Warsh's tenure). BTC barely moved (+1%). A September hike is live: CME FedWatch shows material probability given oil above $80 and PCE at 3.7% (second-highest since Oct 2024). Bitwise argues future rate sensitivity for BTC will shrink as expected move magnitudes decrease.
  • Asia chip-stock crash (KOSPI -10.8% single session, SK Hynix -14.8%) spilled into US markets, triggering $510M+ crypto long liquidations and driving BTC to ~$62,700. Recovery in Asia the next day (KOSPI +17.9%) did not lift US equities, with BTC diverging downward at month-end.
  • Iran/oil: WTI near $79–$85 across the week on Hormuz strikes and shipping disruption, reviving inflation risk and keeping rate-cut expectations depressed. CoinShares frames this as the dominant headwind preventing a sustained BTC recovery despite improving sentiment.

Standouts

  • Circle received a New York limited-purpose trust charter from NYDFS, adding to its recent OCC national trust bank approval; shares rose 8.4%. Regulatory footprint expansion matters for USDC institutional adoption.
  • Citadel Securities invested $400M in Crypto.com at a $20B valuation. TradFi market-maker validation of a major exchange is a structural credibility signal.
  • RWA perpetual futures volume reached 99.2% of Bitcoin perp volume on Hyperliquid and Binance ($61.7B 7-day), with tokenized equities at 57.8% of that total. Market structure is shifting away from crypto-native speculation.
  • Tether's excess reserves fell $4.1B QoQ to $4.1B on BTC/gold price declines; net operating profit $1.5B but overall H1 result negative $3.2B. Reserve cushion compression is a watch item for USDT stability perception.
  • Bhutan's Gelephu Mindfulness City appointed 3iQ to manage an undisclosed portion of its Bitcoin treasury; custody/yield terms not disclosed. Sovereign BTC treasury institutionalization continues outside the US.