News Brief
Published Jul 31, 2026 11:26
News Brief

Bitcoin News - July 31, 2026 at 11:00 AM

Bitcoin News Jul 31, 2026 11:00 Scheduled 11 outlets
120Articles 120Extracted 0Failed 26.3mRuntime

Top of Mind

The Coldcard Mk3 security incident is today's most operationally urgent development. Coinkite confirmed a firmware flaw caused seeds generated since March 2021 to draw from a software RNG fallback rather than the hardware generator, reducing effective entropy to ~40 bits. Roughly 594 BTC ($38M) was swept from ~500 single-signature addresses in three blocks; Block's independent analysis suggests total exposure could reach ~1,083 BTC across related transactions. Coinkite believes an AI-assisted audit of its open-source firmware found the vulnerability — the same technique its own internal review missed weeks earlier. Any PM holding self-custodied BTC on a Coldcard Mk3 (firmware 4.0.1 through 5.0.3) should treat those seeds as compromised and migrate immediately; Mk4/Q/Mk5 exposure is reduced but not zero at ~72-bit effective entropy.

Market Structure

  • BTC ~$64,300–$64,800, down ~26% YTD and ~49% from the October $126,080 ATH. Spot volume averaged $2.2B/day in July, lowest since 2019; CME open interest near multi-year lows; perpetual OI stalled ~300K BTC (K33).
  • ETF flows turned positive Thursday: $233M net inflows (IBIT led at $183M), snapping a 4-session/$526M outflow streak and putting the week in the green at ~$204M. July cumulative: +$438M, on pace to end a two-month outflow run. Fear & Greed at 37 ("fear").
  • VanEck flags no bottom signal yet: 1-month put/call IV skew at +11.4 ppts (83rd percentile), funding ~+4.5% (half long-run avg). True capitulation markers — skew >+15 or negative funding — have not appeared.
  • Aschenbrenner fund (Situational Awareness) forced liquidation of ~$1B in BTC miner/AI infrastructure stocks drove intraday surges of 18–27% in IREN, Core Scientific, Riot, CleanSpark, Bitdeer, HIVE. Citadel absorbed most of the flow per WSJ.

Policy and Institutions

  • CLARITY Act stall deepens: Polymarket odds at 26%, Kalshi 37% — year lows. Senate Majority Leader Thune won't commit to a floor vote before August recess. Treasury Secretary Bessent publicly demanded a vote, quoting Satoshi. JPMorgan warns delayed passage cedes tokenization growth to legacy finance. SEC Chair Atkins said the agency will write its own rules if CLARITY fails, but noted administrative rules lack statutory permanence.
  • Strategy Q2: $8.22B loss, swinging from a $10.02B profit a year ago, driven entirely by unrealized BTC price decline. Holdings grew 11% to peak 846K BTC; convertible debt cut 18% to $6.7B; USD reserve now $3.75B (~2 years of preferred dividends). MSTR down >80% from 2024 peak. Company has paused BTC purchases five consecutive weeks.
  • Coinbase Q2 miss: Revenue $1.22B vs. $1.29B expected; EPS -$1.36 vs. -$0.17 expected; shares -7% after hours. Bright spots: record 10.3% global trading market share, prediction market revenue +106% QoQ, USDC on platform hit record $20B average. Stablecoin revenue disappointed at $292M vs. $327M forecast.
  • Trump financial disclosures: >$1.16B in crypto-related income in 2025 including $526.8M from WLF token sales and $635M in memecoin royalties. Democrats introduced an Anti-Corruption Bureau bill in direct response. Disclosure complicates CLARITY ethics negotiations.

Network and Industry

  • Coldcard Mk3 entropy flaw (see Top of Mind): emergency firmware 5.6.0/1.5.0Q shipped; updating does not repair existing seeds. BIP-39 passphrase users face "minimal risk."
  • BitMEX shuttering September 23 after 11 years; BitMart wind-down follows. Bloomberg/CoinQuant: BitMEX Bitcoin futures market share at 0.08%. Top-5 platforms now control ~80% of global spot volume. Exchange consolidation structural, per multiple analysts.
  • Hut 8 signed second 15-year/352 MW lease at Beacon Point (total 704 MW contracted), reportedly with Nvidia (single-sourced, FT). Core Scientific announced 530 MW AMD partnership; Bernstein pegs 15-year revenue at ~$14B, ~96% EBITDA margin on the direct-lease tranche.
  • BIP459 (DahLIAS full BIP340 signature aggregation) posted to Bitcoin-Dev by Fabian Jahr; 64-byte aggregate regardless of signer count, interactive two-round protocol. Relevant to future CISA but consensus change explicitly out of scope of the BIP.

Macro Linkages

  • Fed held 3.50–3.75% in a 9-3 vote (three regional presidents dissented for a hike — most dissents of Warsh's tenure). June PCE came in at 3.7% YoY (in line, down from 4.1%) with first month-on-month decline since 2020; Q2 GDP 1.5% vs. 2.1% forecast. Data reduces the case for September tightening; Bitwise CIO Hougan argues future rate moves will be smaller and less BTC-relevant.
  • Asia chip-stock crash drove the week's BTC lows: South Korea's KOSPI -10.8% in a session (SK Hynix -14.8%), Kioxia -18.3%. Combined hyperscaler 2026 capex now ~$725–730B; AI capex sustainability fears triggered the risk-off that pushed BTC to $62,700 intraweek.
  • BoJ rate decision (July 31) on watch: USD/JPY near 164 (40-year yen lows). Markets price 98–99% hold. Analysts flag repeat 2024 carry-trade unwind risk if BoJ surprises or yen weakens further — historically a direct BTC headwind.

Standouts

  • Banco Santander disclosed a $4.3M IBIT position via SEC filing — incremental institutional adoption signal.
  • US Treasury sanctioned HormuzSafe, alleging it accepted BTC to generate IRGC revenue from Strait of Hormuz maritime tolls — first direct OFAC BTC-evasion designation tied to active Iran conflict.
  • Anthropic's Claude Mythos cracked HAWK (NIST post-quantum finalist), reducing key-breaking cost from 2^64 to 2^38 operations — materially complicates Bitcoin's quantum-migration path.
  • Bhutan's Gelephu Mindfulness City appointed 3iQ to manage an undisclosed portion of its BTC treasury — sovereign BTC allocation gaining institutional-grade management structure.
  • Galaxy data: dormant BTC movement hit 4-year lows in Q2, suggesting long-term holder distribution has slowed — historically precedes above-average forward returns.