Paxos purchases an institutional wallet provider in a $100M deal.
The move leverages Fordefi’s MPC wallet for a regulated custody framework.
DeFi is increasingly becoming part of the mainstream monetary infrastructure.
Paxos, a reputable blockchain infrastructure company behind multiple stablecoins, confirmed the acquisition on Forderfi late on Tuesday.
While the firms didn’t reveal the transaction’s value, sources close to the matter suggest that the deal exceeds $100 million, reflecting one of the most aggressive and strategic expansions in recent years.
The team emphasized:
This strengthens our ability to support institutions with more flexible and sophisticated digital asset infrastructure.
For context, Fordefi is a thriving enterprise wallet and custody provider.
This acquisition comes as institutions are moving to on-chain operations at an unprecedented pace.
Companies exploring blockchain technology like tokenized assets, complex DeFi strategies, and stablecoin settlements are seeking secure, modular custody.
Paxos aims to satisfy this demand by merging its compliant custodial infrastructure with Fordefi’s policy-centered MPC (multi-party computation) wallet tech.
Commenting on the strategic purchase, Paxos co-founder and CEO Charles Cascarilla said:
Together, Paxos and Fordefi provide customers with a world-class custody solution built upon advanced wallet technology and regulated, qualified custody. We’re excited to welcome Fordefi to our team as we enter this new phase of growth.
Paxos enriches its enterprise playbook
Businesses venturing into the blockchain and crypto sectors have leveraged Paxos for compliant infrastructure and custody.
The firm maintains a high-end regulatory model, with supervision from Singapore’s MAS, the NYDFS in the US, Abu Dhabi’s FSRA, and FIN-FSA in Europe.
Moreover, its tokenization and stablecoin systems power fiscal settlements for leading companies, including MasterCard, Nubank, PayPal, and Interactive Brokers.
Now, Paxos is integrating Fordefi to offer its customers a unified platform that supports everything from asset tokenization and issuance to streamlined access to DeFi protocols.
CEO Cascarillar added:
Fordefi has built an impressive stack and customer base founded on easy-to-use APIs and seamless web3 connectivity. Market participants require a regulated platform partner that meets their range of complex custody needs.
The fast-growing Fordefi
Fordefi has grown into a reputable institutional wallet provider in the DeFi industry since its 2021 launch.
The platform boasts two crucial features.
First and foremost, Fordefi’s MPC-based address model reduced single-point failure risks.
On the other hand, the policy engines enable enterprises to handle compliance rules, risk management, and permissions across decentralized and centralized setups.
Fordefi currently secures over $120 billion in monthly transactions, supporting nearly 300 enterprises, including hedge funds, crypto-native companies, and trading desks.
Josh Schwartz, CEO of Fordefi, believes Paxos will heighten its reach while aligning with its primary missions. He said:
Fordefi has built a best-in-class wallet platform trusted by nearly 300 institutions. Joining Paxos allows us to bring our technology to an even broader audience while maintaining our focus on security, usability, and innovation. Together, we will offer enterprises the unified custody and stablecoin infrastructure they need to deploy real-world digital asset use cases at scale.
For now, Fordefi will operate independently as Paxos pursues a phased integration.
Crypto-friendly White House economic adviser Kevin Hassett has reportedly emerged as a top candidate for the next Federal Reserve chair, replacing Jerome Powell when his tenure is up in May.
President Donald Trump’s advisers and backers see Hassett as the frontrunner to take over as Fed chair, as he’s expressed sympathy with Trump’s desire to cut rates, Bloomberg reported on Tuesday, citing people familiar with the matter.
Hassett is the director of the National Economic Council, who oversees the White House’s digital asset working group that Trump created in January. This group released a report in July outlining policy considerations for crypto.
Hassett is one of many reported crypto-friendly Fed chair picks who have backed Trump’s desire for the central bank to cut rates to juice up the markets. Powell’s time as chair is up in May, but his tenure on the Fed Board extends until January 2028.
Asked by Fox News on Tuesday if he would take a job as Fed chair, Hassett said, “Of course I’d have to say yes, because I want to serve my country and I want to serve my president.”
Kevin Hassett was speaking to Fox News on Tuesday. Source: Fox News
“President Trump and I have talked a lot about it,” he added.
Hassett owns Coinbase stocks, was a crypto adviser
In June, Hassett reportedly disclosed that he owned at least $1 million worth of Coinbase (COIN) stock.
He also disclosed that he received a $50,001 salary from Coinbase for serving on the crypto exchange’s Academic and Regulatory Advisory Council, which the company created in 2023 and also included Manhattan US Attorney Jay Clayton.
Hassett has previously served on the advisory board for the crypto fund manager One River Digital Asset Management and was chair of the White House Council of Economic Advisers from 2017 to 2019, in Trump’s first term.
Also on the potential to take over the Fed is its vice supervision chair, Michelle Bowman, who said Fed staff should be allowed to invest a small amount in crypto to get a “working understanding of the underlying functionality.”
Whoever Trump picks, he’ll be pressuring them to cut rates. The Fed has cut rates twice this year by a total of 50 basis points.
The market has turned bullish on a Christmas cut when the Fed meets in December, with CME’s FedWatch putting the chances of a 25-basis-point cut at around 85%.
Trading platform Robinhood says prediction markets have emerged as one of its fastest-growing product lines in terms of revenue, and is now set to expand its business with a futures and derivatives exchange and clearinghouse.
Since launching its prediction markets in March in partnership with prediction market platform Kalshi, nine billion contracts have been traded by more than one million users, Robinhood said in a statement on Tuesday.
JB Mackenzie, the general manager of futures and international at Robinhood, said the platform is “seeing strong customer demand for prediction markets, and we’re excited to build on that momentum.”
Robinhood said it is also planning to grow its investment in prediction markets, with a futures and derivatives exchange and clearinghouse, to deepen its investment in prediction markets.
“Our investment in infrastructure will position us to deliver an even better experience and more innovative products for customers,” Mackenzie added.
Robinhood derivatives exchange will launch in 2026
The exchange will have Robinhood as the controlling partner and market maker, Susquehanna International Group as the day-one liquidity provider.
As part of the venture, Robinhood will also acquire MIAXdx, a Commodity Futures Trading Commission (CFTC) licensed derivatives clearing organization and swap execution facility. Robinhood said the derivatives exchange is expected to begin operations in 2026.
Prediction market interest surging
Prediction markets have become one of the hottest crypto offerings this year, with volumes on platforms such as Kalshi and Polymarket holding firm amid increased mainstream media attention.
Kalshi is a regulated prediction market platform in the US that operates under the oversight of the CFTC and has a trading volume of $4.47 billion over the last 30 days, according to DeFi data aggregator DefiLlama.
Prediction market Kalshi has recorded a trading volume of $4.47 billion over the last 30 days. Source: DefiLlama
In comparison, Polymarket, a US-based cryptocurrency-based prediction market, has recorded $3.58 billion in trading volume over the last 30 days.
Crypto exchanges are also expanding into prediction markets
Crypto.com recently started offering a prediction markets platform, which is set to be integrated with Trump Media.
Crypto exchange Gemini is also planning to launch a prediction markets platform as part of an initiative to create a “super app,” and said on Nov. 11 it filed to become a designated contract market with the Commodity Futures Trading Commission to offer the platform.
The pain may not be over yet for Bitcoin investors, according to one crypto analyst, arguing that there’s still more leverage that could be flushed out.
Crypto analyst James Check described the recent market meltdown as a “2-sigma long liquidation event,” which wiped out a “chunk of degen gamblers.”
Most of the leverage is gone, but the market “has an incredible nose that can sniff out the final hold-outs,” he added, cautioning that a further flush out could be on the cards.
“We wouldn’t be too surprised if we wick into the $70k-$80k zone to flush the final leverage pockets.”
A 2-sigma liquidation event in crypto refers to a significant market movement that triggers mass liquidations of leveraged positions, with “2-sigma,” or two standard deviations, indicating the statistical magnitude of the price swing.
Bitcoin shed over $24,000 in just ten days, dropping to a seven-month low of around $82,000 on Nov. 21.
Graph of Bitcoin’s 2-sigma liquidation event. Source: James Check
Bitcoin has found a local bottom
The crypto markets showed tentative signs of stabilization after last week’s dramatic sell-off, and may have found a local bottom, Augustine Fan, head of insights at crypto trading software service provider SignalPlus, told Cointelegraph.
“Markets are currently so oversold from both sentiment and technical perspectives (such as Bollinger Bands), and prices are likely to have seen local lows for now, absent any new exogenous factors (such as DAT forced selling),” she said.
Fan expects prices to range between $82,000 and $92,000 and identified the next significant price support around the $78,000 area.
“A sustained break below would open up further significant downside, but is not the base case scenario for now,”
Bitcoin whales are still distributing BTC
Analysts at blockchain data provider CryptoQuant identified a local bottom that could lead to a more sustained rebound.
“On-chain data shows a market shaped by institutional redistribution, structural weakness, and a rebound that may signal a local bottom,” said analyst Carmelo Alemán on Tuesday.
However, the crucial 1,000 to 10,000 BTC whale cohort is still selling, which prevents a full confirmation of the trend reversal, he added.
“The recovery is promising, but the end of the bearish phase requires a clear shift in whale behavior.”
US Bancorp is running a stablecoin pilot on the Stellar blockchain, joining the growing number of banks experimenting with the technology.
The bank is partnering with consulting company PricewaterhouseCoopers (PwC) and the Stellar Development Foundation to run the pilot.
“The bottom line is institutions have arrived. New financial infrastructure is taking shape now, and US Bank, PwC, and SDF are working to unlock the next wave of digital banking,” said the Stellar Development Foundation on Tuesday.
US Bancorp is the publicly traded parent company of US Bank, which holds more than $664 billion in assets under management and reports annual revenue of over $27.5 billion, according to the bank.
Stablecoin test to demonstrate the promise of blockchain to banks
Kurt Fields, director and blockchain lead at PwC, said the primary objective of the pilot was to demonstrate the promise of blockchain in a trusted, bank-grade environment during a Tuesday episode of the US Banks podcast, Money 20/20.
“We’ve been talking about blockchain for years and we’re at a point now where it’s not about innovation anymore,” he said.
José Fernández da Ponte from the Stellar Development Foundation, Mike Villano from US Bank and Kurt Fields from PwC. (Left to right) Source: YouTube
“It’s about practical application in a rigorous, highly regulated environment where we’re taking advantage of the tooling onchain in this case on the Stellar network to demonstrate that the promise of programmable money actually yields benefits for not only the institution but the customers that they serve.”
Stellar blockchain chosen for its ability to freeze assets
The Stellar network launched in 2014 as an open-source, decentralized blockchain designed for cross-border payments and asset tokenization.
Mike Villano, the head of digital assets products at US Bank, said his organization chose Stellar for its pilot because it allows transaction unwinding and clawbacks.
Villano said the Stellar platform has the “ability at their base operating layer to freeze assets and unwind transactions,” which was a key consideration for customer protections.
“Often, you might write that into the business logic in itself, but in this instance, you could do it at the core blockchain layer. So that was very interesting to us,” he added.
Tokenized asset research is also in the works at US Bank
Villano also said US Bank is looking at tokenized assets and is in the research phase.
“We’re also doing some additional research around tokenized assets, where if you could take the value proposition of moving quickly, moving 24/7 and moving it very efficiently, you can apply that to all sorts of other asset classes that come along with it,” he said.
“So we’re excited to see where that research goes for us as well.”
Zcash surged more than 10x within weeks, briefly returning to large-cap territory with a valuation above $10 billion.
On Coinbase, ZEC became the most-searched asset in mid-November, surpassing both Bitcoin and XRP.
The rally is supported by several real shifts: the 2024 halving, rising shielded balances and the NU6.1 holder-controlled funding model.
Analysts are divided, with some calling the move a blow-off top and others viewing it as a repricing driven by renewed interest in “responsible” privacy coins amid stricter AML rules.
Zcash wasn’t expected to become a major story this market cycle. For most of the past few years, the privacy coin remained in the background while Bitcoin (BTC), Ether (ETH), XRP (XRP) and a rotating cast of memecoins dominated headlines and trading activity.
Then November arrived.
In just a few days, Zcash (ZEC) climbed to the top of Coinbase’s search rankings. A screenshot shared by Zcash adviser Thor Torrens showed ZEC drawing around 52,000 searches on the platform. This was ahead of both XRP and Bitcoin, which recorded roughly 41,000 and 39,000 searches, respectively.
Zcash tops search charts on Coinbase
At the same time, ZEC’s price had already surged, delivering a four-digit percentage gain over the past year and briefly pushing the token back into the large-cap bracket.
For a coin many traders had written off as a relic of the previous privacy cycle, the question now is simple: How did Zcash go from low-profile to most-searched in a single month?
Did you know? Zcash founder Zooko Wilcox is a longtime cypherpunk who worked on DigiCash in the 1990s and helped create projects such as Tahoe-LAFS, the BLAKE2 hash function and the concept known as Zooko’s Triangle long before ZEC launched.
How Zcash slipped into low-profile relic status
For readers who haven’t looked at it in years, it is worth remembering what Zcash actually is.
Launched in 2016 as a Bitcoin-style proof-of-work (PoW) chain with a hard cap of 21 million coins, it was built around cutting-edge zero-knowledge proofs. These allow users to send either transparent transactions, similar to Bitcoin, or fully shielded transactions where amounts and addresses are hidden but still mathematically verifiable.
For a while, it was treated as a kind of “science project with a price,” backed by heavyweight cryptographers and privacy advocates.
Then the spotlight moved on. As regulators increased scrutiny of privacy coins, several major exchanges delisted or restricted them, and Monero (XMR) gradually became the default choice for die-hard privacy users.
ZEC slid down the market capitalization rankings, daily volumes thinned out, and social chatter faded. By early 2024, despite having survived two halving events and multiple network upgrades, it looked more like a legacy token from an earlier era than a contender for a new narrative.
The slow turnaround: Halvings, shielded usage and a governance reset
The November spike did not come out of nowhere. Zcash spent the past two years quietly reshaping its underlying story, while most of the market was not paying attention.
On the monetary side, the most recent halving on Nov. 23, 2024, cut the block reward from 3.125 ZEC to 1.5625 ZEC, reducing daily new issuance from roughly 3,600 coins to about 1,800. With a fixed supply of 21 million and halving cycles now running on a tighter post-Blossom schedule, ZEC began to be discussed in “sound money” terms by parts of the community.
Under the hood, actual usage was shifting as well. Coinbase research notes that the amount of ZEC held in shielded addresses climbed from about 1.7 million coins to roughly 4.5 million over the past year, with more than 1 million coins moving into shielded pools within a three-week window.
Overall, more than 27% of the circulating supply is now shielded, and other trackers show the peak shielded supply briefly rising above 5 million coins. This suggests that users are not just trading the ticker.
At the same time, the new funding and governance structure went live. The NU6.1 upgrade, activated on Nov. 24, 2025, allocates 8% of block rewards to community grants and 12% to a coinholder-controlled fund. This gives ZEC holders a formal say in how millions of dollars in development capital are deployed between now and the next halving in 2028.
Together, these changes laid the groundwork for a rerating long before search volumes surged.
Did you know? The Electric Coin Company commissioned Rand Europe to study criminal use of Zcash. The researchers found that ZEC had only a minor presence on the dark web and that Bitcoin remained the dominant currency for illicit activity.
Privacy revival, Monero exploit and new AML rules
The spark for all this was a mix of narrative and timing.
Privacy suddenly returned to focus after a high-profile exploit in Monero shook confidence in the sector’s default choice. Commentators began looking for an alternative with active governance and a clear upgrade path. With a scheduled network update underway and a halving narrative in the background, Zcash positioned itself as a candidate to fill that vacuum.
At the same time, regulators continued tightening oversight on opaque money flows. New Anti-Money Laundering (AML) rules, stronger Travel Rule enforcement and increased scrutiny of mixers made “total darkness” harder to defend, whereas Zcash’s model of optional privacy and auditable view keys appeared more compatible with compliance-minded institutions.
A rival stumbling, a returning theme and a protocol that could be positioned as a “responsible” privacy coin gave ZEC a fresh story just as traders were looking for the next big narrative.
About the Coinbase surge: What 52,000 searches really mean
According to figures shared by Zcash adviser Torrens, ZEC logged around 52,000 individual searches on Coinbase in mid-November, compared with roughly 41,000 for XRP and 39,000 for Bitcoin.
That is a clear snapshot of retail curiosity, with tens of thousands of users typing “Zcash” into the search bar on one of the largest fiat on-ramps in the world.
Off-exchange, social data from X and Reddit showed a similar rise in mentions. Taken together, November was the month Zcash reentered retail consciousness.
Blow-off top or real repricing
Look only at the chart, and it is easy to call this a blow-off top. From late September to early November, ZEC climbed from the mid-$70s to more than $700, at one point rising over 1,000% this fall and more than 500% in a single month, before sliding about 30% from its local high.
Coinbase notes that Zcash futures volume approached $10 billion on Nov. 7, and derivatives platforms have reported rising open interest as traders piled into the move. For anyone who has lived through past altcoin manias, those indicators often appear in periods of heavy speculative positioning.
But there is also a case that November was more of a repricing rather than a pure mania spike. Supply growth has already been cut in half by the 2024 halving, shielded usage now accounts for more than a quarter of the circulating supply, and NU6.1 has introduced a clearer and more transparent funding model through the next halving cycle.
If those fundamentals hold, some analysts argue that any sharp correction could represent a reset within a higher range, although outcomes remain uncertain. The hard part, as always, is separating narrative from lasting change in real time.
Did you know? Before Zcash launched in October 2016, futures contracts tied to the coin on over-the-counter (OTC) platforms jumped from about $18 to $261 in six weeks, a roughly 1,300% gain driven purely by anticipation of its privacy technology.
What Zcash’s November moment tells us about crypto narratives
Zcash’s November moment says as much about the broader crypto market as it does about one older token.
Markets have a habit of rediscovering assets that quietly improve their economics, strengthen governance and wait for the right macro story to catch up. In this case, the story centered on privacy. Rising concern over data exposure, tighter AML enforcement and fatigue with fully transparent chains created space for a “partial privacy” alternative that did not appear to be an immediate regulatory target.
For readers, the takeaway is twofold.
First, exchange search data is a useful early signal for where retail attention is drifting, but it often appears just as fear of missing out (FOMO) peaks.
Second, themes never truly disappear in crypto; they cycle. If Zcash can turn a legacy reputation into a fresh narrative, other forgotten categories may not be as dead as their charts suggest.
A high-conviction Bitcoin whale placed a $2 billion wager that the worst is over and the market bottom might be in after a brutal leverage washout stripped speculative froth from the crypto market.
On Nov. 24, Deribit, the Coinbase-owned crypto options trading platform, reported a 20,000 BTC notional block trade, which appears to signal that institutional capital is pivoting from damage control to strategic accumulation.
According to the platform:
“[The] trader lifted a long-dated 100k/106k/112k/118k call condor for Dec ’25. Signal is clear: a structured bullish view – expecting BTC to reach the 100–118k zone, not explode past it.”
What does this trade signal?
This position effectively bets that the recent liquidation cascade marked a cycle-defining bottom that has cleared the runway for a march toward six figures.
Indeed, the trade structure is precise. By buying call options at $100,000 and $118,000 while selling calls at $106,000 and $112,000, the investor is targeting a specific profit corridor.
Bitcoin Block Trade (Source: Deribit)
It represents a bet that the BTC will recover and settle into a high valuation band, but without the chaotic volatility that characterized the recent crash.
Meanwhile, this positioning arrives at a critical juncture. While retail investors remain hesitant, the derivatives market is signaling that the structural damage has been repaired.
So, the trade implies that the recent $27,000 plunge from the highs was a necessary cleansing event, resetting the board for the next leg of the cycle.
The 1.3 Million BTC flush
To understand the conviction behind the $1.7 billion bet, one must look at the scale of the wreckage left behind. The market has just endured its sharpest contraction in open interest of the entire cycle.
According to data from CryptoQuant, open interest in Bitcoin terms has plummeted by roughly 1.3 million BTC over the last 30 days. The vast majority of this unwind occurred on Binance, marking a decisive end to the speculative fever that had earlier driven aggregate open interest to record highs.
Bitcoin Open Interest (Source: CryptoQuant)
This scale of capitulation mirrors the depths of the 2022 bear market. As a result, BTC’s recent drop from $106,000 to roughly $79,500 was primarily driven by mechanical liquidation cascades rather than fundamental decay.
This means that traders holding long positions were swept from the board in a violent feedback loop, turning a healthy correction into a crash.
However, historical patterns suggest these “cleansing phases” are often bullish signals.
By forcing the closure of overly optimistic positions and flushing out weak hands, the market builds a more stable floor. The reduction in speculative exposure implies that selling pressure from distressed leverage is now exhausted.
Whales accumulate, retail flees
Meanwhile, beneath the surface of the derivatives flush, on-chain data reveals a distinct shift in ownership that supports the bottoming thesis.
The market is transitioning from aggressive selling to an orderly unwind. Key stress metrics such as transfer volumes and realized capitalization change have subsided, a hallmark of late-cycle corrections.
More importantly, a clear divergence has emerged between investor cohorts. While retail investors (holding less than 10 BTC) have been net sellers over the last 60 days, mid-sized “sharks” and institutions are stepping in.
CryptoQuant data shows that BTC cohorts holding between 100 and 1,000 BTC, as well as those holding more than 10,000 BTC, have been steadily accumulating throughout the dip. These sophisticated players are absorbing the supply being distributed by fearful retail hands.
However, the one remaining headwind is the 1,000 to 10,000 BTC cohort, which continues to distribute.
So, for the recovery to transition into a confirmed reversal, this group must slow its selling. As such, the $1.7 billion options bet is an early indicator that the “smart money” believes this shift is imminent.
Macro pivot points
At the same time, the whale’s trade timing anticipates a favorable shift in the macro environment. The week ahead is loaded with heavy economic data releases, including US PPI and PCE figures, which will anchor expectations for the Federal Reserve’s December policy meeting.
With markets pricing in an 81% probability of a rate cut, a dovish data skew would provide immediate liquidity support for risk assets.
Coin Bureau co-founder Nic Puckrin told CryptoSlate that the increased odds of a rate cut had helped push Bitcoin’s recent upward trend above $87,000.
“We could see further upside in the short term if sentiment holds, especially with longs underweighted,” he said, while cautioning that optimism is “tenuous” with the FOMC divided and no confirming data yet.
Puckrin added that the Fed’s next decision could decide whether year-end brings a “Santa rally” or a “Santa dump,” and he expects jitters to persist into the Dec. 10 meeting.
In this context, the Call Condor acts as a strategic vehicle. The sheer size of the position creates massive dealer hedging flows. As prices move toward the $100,000 activation zone, dealers who sold the structure will be forced to hedge their exposure, creating a magnetic pull toward the profit band.
Caroline Pham, acting chair of the US Commodity Futures Trading Commission, called for nominations of CEOs to fill seats on a council to discuss policies, including those related to digital assets.
In a Tuesday notice, Pham said the CFTC would be accepting submissions until Dec. 8 for a “CEO Innovation Council,” referencing the regulator’s previous efforts to regulate digital assets, including its “Crypto Sprint” initiative, a crypto industry forum, and Congress’ progress with a market structure bill. The acting chair said the council would focus on the CFTC’s “expanded mission over crypto and prediction markets.”
“The CFTC stands ready to carry out our mission over expanded markets and products, including crypto and digital assets, and ensure our markets remain vibrant and resilient while protecting all participants,” said Pham. “In order to hit the ground running, it is critical that the CFTC drives public engagement with the support of expert industry leaders and visionaries who are building the future.”
It’s unclear when the CFTC will officially form the council, but it could occur after Pham leaves the commission. The acting chair could soon be replaced by SEC official Michael Selig, whose nomination as a Senate-confirmed chair of the commission is expected to be headed for a floor vote soon. Many lawmakers will not return to Washington, D.C., until after the Thanksgiving holiday.
Selig signals crypto priorities as CFTC faces leadership void
Though the Senate has not yet voted on Selig’s nomination, his testimony before lawmakers in the Agriculture Committee last week offered a preview of how he might approach digital asset regulation if confirmed.
Selig said it was “vitally important” to have a “cop on the beat” for regulating spot digital asset commodity markets. He also said it was “very valuable to have a diversity of viewpoints,” referring to the dearth of leadership at the CFTC — Pham has been the sole commissioner for months, and the White House had announced no additional nominations from US President Donald Trump as of Tuesday.
MegaETH’s pre-deposit event unraveled on Tuesday after a cascade of technical failures disrupted what was meant to be a controlled opening for verified users.
In an X post, the team said that configuration errors and rate-limit issues caused the platform’s Know Your Customer system to fail. The pre-deposit was an early window for verified users to lock in MEGA token allocations.
In addition to the KYC failures, a fully signed Safe multisig transaction — prepared for a later cap increase — was executed prematurely, allowing new deposits to flow in and pushing the raise past its intended $250 million limit.
“The $250M cap is filled by people who were spamming refresh on the Pre-Deposit Website and were able to catch the random opening time,” the protocol said.
MegaETH ultimately froze deposits at $500 million and scrapped plans to expand the raise to $1 billion. A retro and a withdrawal option will be released shortly.
“At no point were assets at risk, but that doesn’t matter; we expect higher of ourselves and there are no excuses,” the team added.
MegaETH is an Ethereum layer-2 protocol designed to deliver ultra-low-latency block processing and throughput, comparable to a real-time Web2 application.
Some users praised MegaETH’s transparency in explaining what happened, but others were far more critical. AzFlin, a developer and DAO founder, argued that the mistakes could have been prevented if engineers had been more careful.
The pre-deposit window came on the heels of MegaETH’s MEGA token auction, which opened on Oct. 27 and was fully subscribed within minutes.
That sale offered 5% of the 10-billion-token supply, with bids ranging from $2,650 to $186,282 and an optional one-year lock-up that provided a 10% discount.
The auction closed on Oct. 30, ultimately drawing more than $1.3 billion in commitments and becoming one of the year’s most crowded raises.
Because contributions far exceeded the cap, MegaETH said it would rely on a “special allocation mechanism” to determine the amount each participant ultimately receives.
MegaETH is built by MegaLabs, a team backed by major industry figures including Ethereum co-founders Vitalik Buterin and Joe Lubin.
Following its testnet launch in March, the project is now targeting 100,000 transactions per second with sub-millisecond latency. The MEGA token is set to launch in early 2026.
Timechain Index founder Sani reported 87,464 BTC flowing out of institution-tagged wallets between Nov. 21 and Nov. 22, adding that he hadn’t seen such movement in months.
Yet, as Sani clarified in a note, the headline figure overstates actual selling pressure. Most of the movement represents internal reshuffling rather than institutions exiting Bitcoin positions.
Sani explained that pre-processed data can show extreme volatility when large holders move coins between custodians or wallets, but after reconciliation, the net flows often land near zero.
Strategy accounted for 49,907 BTC of the tracked outflows, but CEO Michael Saylor confirmed the company sold no Bitcoin that week. In fact, Strategy added 8,178 BTC last week, according to Bitcoin Treasuries data.
Sani’s assessment indicates that Strategy transferred holdings to new custodians to diversify risk, with some coins appearing in addresses linked to Fidelity Custody. Additionally, that’s the second time the firm has performed such a movement.
This is not unique to Strategy. Sani shared that BlackRock moved Bitcoins out of their known addresses twice as well. The first time happened last year, and the second occurred a few weeks ago, when they moved nearly 800,000 BTC to new addresses. Additionally, Coinbase also reshuffled a similar amount this weekend in a UTXO consolidation exercise.
Back to the over 15,000 BTC in outflows, Bitcoin ETFs bore the brunt on Nov. 21, shedding 10,426 BTC as issuers processed redemptions tied to $903 million in net withdrawals reported Nov. 20.
ETF outflows translate directly to liquidations, as fund managers must sell the underlying Bitcoin to meet shareholder exit requests. Still, the scale fell within normal bounds given the prior day’s redemption activity.
Timechain Index tracks 16 entity categories, including centralized exchanges, miners, ETFs, publicly traded companies, custodians, governments, OTC desks, and payment processors.
The platform aggregates known addresses for each cohort and monitors balance changes in real time.
Sani’s “LiveChangesSummary” data showed Strategy’s 49,907 BTC outflow, Coinbase’s 11,762 BTC outflow, and ETC Group’s 6,973 BTC outflow as the largest movements, with smaller flows across custodians, exchanges, and miners.
Timechain Index data shows 87,464 BTC left institution-tagged wallets on Nov. 21, with MicroStrategy’s 49,907 BTC transfer representing the largest single movement.
Routine custody operations vs. directional bets
The distinction matters because Bitcoin’s on-chain transparency makes wallet movements visible before context arrives.
When 87,464 BTC appears to leave institution-tracked addresses in a 24-hour window, the immediate read can suggest panic selling or a coordinated retreat from crypto exposure.
The post-processing showed the opposite: net institutional holdings remained stable after accounting for internal transfers and standard ETF mechanics.
Strategy’s custody diversification aligns with treasury management best practices for large holders. Concentrating nearly 650,000 BTC with a single custodian creates operational risk, and spreading holdings across multiple qualified custodians reduces exposure to any single point of failure.
Bitcoin ETFs operate under different constraints. When investors redeem shares, authorized participants return creation units to the issuer and receive the underlying Bitcoin, which they then sell on the market to close out arbitrage positions.
The Nov. 20 outflow figure of $903 million corresponded to roughly 10,400 BTC at prevailing prices, matching the ETF-cohort outflow Timechain Index recorded the following day. The lag reflects settlement timing rather than discretionary selling.
