Today in crypto, New York prosecutors warned that the US GENIUS Act could expose markets to fraud, Strategy disclosed a $75.3 million Bitcoin purchase made during last week’s sharp dip, and US spot Bitcoin ETFs fell underwater on average after $2.8 billion in investor outflows over the past two weeks.
NY prosecutors warn GENIUS Act could enable stablecoin fraud
New York Attorney General Letitia James and four other state prosecutors have warned Congress that the GENIUS Act could weaken fraud protections for stablecoin users, CNN reports.
In a letter to lawmakers, as viewed by CNN, the prosecutors said the bill fails to require stablecoin issuers to return funds lost to fraud or theft, arguing it could leave victims without restitution while limiting states’ ability to enforce consumer protection laws. They warned that the legislation may provide “legal cover” for stablecoin companies even when users are harmed.
The letter specifically criticized the lack of mandatory cooperation for issuers during criminal investigations, noting that voluntary policies around freezing or recovering funds are inconsistent. Prosecutors said this could undermine law enforcement efforts and embolden bad actors as stablecoin adoption grows.
The GENIUS Act was signed into law last July and is set to take effect 18 months after enactment, or 120 days after US regulators finalize implementing rules, whichever comes first.
Strategy buys $75.3M in BTC as prices briefly dip below $75K
Latest filings show Michael Saylor’s Strategy has bought 855 Bitcoin at about $88,000 each last week, as BTC briefly fell below its average cost for the first time since 2023.
Bitcoin started the week above $87,700 and reached $90,000 before briefly plummeting below $75,000 on Sunday, according to CoinGecko.
The world’s largest public Bitcoin holder now sits on 713,502 Bitcoin, purchased for about $54.26 billion at an average price of $76,052 per coin. The buy came as Bitcoin briefly fell below Strategy’s average purchase cost, marking the first time it has traded below the company’s cost basis in over two years.
While the odds of Bitcoin falling below $65,000 this year climbed to 72% on Monday, Polymarket also shows an 81% probability that Strategy’s Bitcoin holdings will reach 800,000 BTC.
Average Bitcoin ETF buy underwater after investors pull $2.8B in 2 weeks
Bitcoin is trading below the average cost basis of US spot Bitcoin ETFs after they recorded their second and third-biggest outflow weeks last month, according to Galaxy’s head of research, Alex Thorn.
The eleven spot BTC ETFs saw $2.8 billion in outflows over the past fortnight, which includes $1.49 billion last week and $1.32 billion the week before, according to CoinGlass.
“This means the average Bitcoin ETF purchase is underwater,” said Thorn.
The total assets under management for US Bitcoin ETF products is approximately $113 billion, according to Coinglass, and they collectively hold around 1.28 million BTC, according to BiTBO, implying an average cost basis of about $87,830 per Bitcoin.
