TL;DR

U.S. Senate advances crypto bill; Bitcoin drops below $113K; ETH/BTC ETFs see $1B+ outflows.

Highlights

• U.S. Senate to vote on crypto market-structure bill in September; year-end passage possible after House approval and recent GENIUS Act stablecoin law1.
• Bitcoin fell below $113,000, triggering $559M in liquidations and $5.7B in BTC sent to exchanges by short-term holders219.
• Ethereum topped $4,000 on record Q3 ETF inflows, but both ETH and BTC ETFs saw over $1B in outflows in two days34.
• Tether minted $1B USDT on Ethereum; Circle minted $1.25B USDC on Solana in a week, highlighting shifting stablecoin network activity56.
• Wyoming launched FRNT, the first U.S. state-issued dollar stablecoin, live on seven blockchains7.
• China is considering yuan-backed stablecoins to expand RMB international use, marking a potential policy shift8.
• Binance and Plasma launched a 250M USDT on-chain yield product, fully subscribed in under an hour12.
• Federal Reserve ended its special crypto oversight program, aligning digital asset supervision with standard banking rules11.
• Chainlink ($LINK) surged 12% past $26 as open interest hit $1.75B and institutional buying increased14.
• Binance’s BNB hit a record $880 as BNB Chain surpassed Ethereum in dApp count15.
• MetaMask added native TRON support; Kraken expanded tokenized equities (xStocks) to TRON 1617.
• Wormhole plans to outbid LayerZero for Stargate Finance , highlighting competition in cross-chain infrastructure20.

Commentary

U.S. regulatory momentum is accelerating, with the Senate preparing to advance comprehensive crypto market-structure legislation in September and bipartisan support building for year-end passage1. The recent GENIUS Act and Wyoming’s FRNT stablecoin launch demonstrate both federal and state-level appetite for clearer digital asset frameworks and public-sector stablecoin initiatives17. Meanwhile, global policy shifts are in play, as China weighs authorizing yuan-backed stablecoins to boost RMB usage abroad—a notable reversal from its 2021 crypto ban8.

Market volatility remains elevated. Bitcoin ’s decline below $113,000 triggered significant liquidations and prompted short-term holders to offload $5.7B in BTC to exchanges, while long-term holders realized $1.5B in gains219. The resulting risk-off sentiment was mirrored in sharp ETF outflows for both BTC and Ethereum , despite Ethereum briefly breaching $4,000 on strong Q3 ETF inflows34. Macro factors, including U.S. Treasury yields and anticipation of Fed commentary from Jackson Hole, continue to drive caution23.

Stablecoin activity is surging and diversifying across networks. Tether and Circle minted over $2B in new stablecoins, with Circle’s USDC issuance on Solana outpacing Ethereum, reflecting institutional demand for faster, lower-fee settlement layers56. The launch of on-chain yield products (Binance/Plasma) and cross-chain stablecoins (Wyoming’s FRNT) points to intensifying competition for stablecoin liquidity, especially as regulatory changes restrict direct yield offerings by issuers712.

Layer 1 and infrastructure plays are showing relative strength. Chainlink’s price and open interest surged on institutional buying and DeFi integration14, while BNB reached new highs as BNB Chain overtook Ethereum in dApp count15. Cross-chain and tokenization themes continue to advance, with MetaMask and Kraken expanding TRON integration and Wormhole entering the bidding for Stargate Finance 161720.

Traders should monitor U.S. Senate progress, ETF/stablecoin flows, and Fed signals for near-term direction. Watch for further rotation among Layer 1s, DeFi infrastructure, and cross-chain protocols as macro and regulatory catalysts unfold.