The London Stock Exchange partnered with Payward to tokenize top UK companies, while Coinbase launched regulated derivatives trading in Canada for accredited investors. However, the industry faced headwinds as Payward delayed its IPO to 2027, Tether faced a lawsuit over frozen funds, and enforcement actions targeted insider trading and illegal donations.
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London Stock Exchange Partners with Payward to Bring UK Equities Onchain
Traditional stock exchanges lending their listings to offshore, unregulated token issuers risks fragmenting domestic liquidity while surrendering secondary-market trading fees to crypto venues.
The London Stock Exchange Group is partnering with Kraken parent Payward to bring the 100 largest UK-listed companies onto rails as tokenized . Under the agreement, Payward will issue the UK through its xStocks framework, which backs each digital token one-to-one with an underlying security held in custody. The first batch of tokenized UK stocks is scheduled to launch within weeks for eligible investors across more than 110 countries. However, UK-based investors are currently excluded from purchasing the products due to regulatory constraints. Beyond the initial tokenization rollout, the London bourse plans to integrate xStocks into LSE 24, its upcoming extended-hours trading venue slated for 2027, subject to regulatory approval. The two companies also intend to explore natively issued equity tokens that would allow exchange members to issue and service shares directly onchain. Payward's xStocks framework has already generated more than $40 billion in total trading volume, with nearly $20 billion settled directly onchain across more than 200,000 holders.
xStocks Volume Metrics ($B)
Total trading volume has reached over $40 billion with nearly $20 billion onchain.
Kalshi Permanently Bans George Santos Over Illegal Trading
Kalshi’s enforcement against candidates betting on their own events establishes that prediction markets must police political insider trading to protect their CFTC-regulated status.
Prediction market platform Kalshi issued its first lifetime trading ban against former U.S. Representative George Santos for insider trading. Santos traded on event contracts tied to whether he would attend President Donald Trump's State of the Union address in February 2026. Kalshi fined Santos $71,356 after finding he misled the public about his attendance plans to manipulate contract prices and secure over $17,000 in profit. The enforcement follows a separate July settlement with the Trading Commission where Santos agreed to pay a $35,000 penalty and accept a three-year trading ban. Kalshi also penalized North Carolina congressional candidate Laurie Buckhout with a three-year suspension and a $2,590 fine for betting on her own race. Prediction markets face mounting pressure from state and federal regulators over insider trading and the manipulation of event contracts.
FBI Seizes Over $560K in Crypto Funding Network Linked to Hamas
Relying on public blockchain ledgers and unencrypted communication channels for terrorism financing exposes donors to law enforcement tracking, ultimately turning crypto's transparency into an investigative tool.
fortune.com reports that the FBI seized more than $560,000 in donations intended for Hamas. The Justice Department announced the disruption of the financing network, which included taking control of website domains and communication platforms used for fundraising and recruitment. Hamas began testing virtual currency fundraising around early 2019 through its military wing, the Qassam Brigades, using Telegram channels and direct online portals. Law enforcement obtained information on thousands of individuals who contacted Hamas to donate. An investigative break occurred last year when a confidential U.S. source alerted law enforcement to a Telegram post soliciting contributions to a Hamas-associated email address.
Coinbase launches regulated crypto derivatives in Canada
Using foreign dealer exemptions to deliver native futures lets Coinbase capture institutional Canadian capital where retail-focused platforms face regulatory exclusion.
Cointelegraph reports that Coinbase has launched regulated trading in Canada through Coinbase Financial Markets, targeting high-net-worth individuals and institutional clients. Eligible Canadian customers with at least $5 million in net financial can now access 23 perpetual and dated , five futures, and the Coinbase 50 . The contracts feature nano-sized positions and up to 10x , operating under foreign dealer and futures commission merchant exemptions. This rollout makes Coinbase the first major crypto-native platform to offer direct native futures in the country. The launch coincides with broader expansion by US platforms into the Canadian market, even as Ottawa proposes tighter oversight including potential bans on crypto ATMs.
Kraken parent Payward delays IPO target to Q2 2027 at earliest
Pushing public listings past near-term horizons forces major crypto exchanges to pivot from liquidity-driven expansion to absorbing infrastructure providers through balance-sheet-funded acquisitions.
coindesk.com reports that Payward has pushed its long-awaited initial public offering to the second quarter of 2027 at the earliest. The parent company of exchange Kraken had confidentially filed a draft S-1 registration statement with the U.S. Securities and Exchange Commission in November 2025. That filing followed an $800 million raise at a $20 billion . Weaker crypto prices, lower trading volumes, and poor aftermarket performance from recently listed digital- peers have sapped investor appetite. Rivals including Grayscale, Consensys, and Ledger have similarly shelved their public market debuts. Payward has instead deployed its capital on , completing purchases of venue Bitnomial and payments platform Reap while agreeing to buy Magic Labs' wallet infrastructure.
Thai businessmen sue Tether over $42 million frozen in scam probe
Exposing secondary-market stablecoin holders to issuer-directed freezes based on informal agency inquiries rather than judicial warrants converts private token contracts into de facto law enforcement enforcement tools.
cointelegraph.com reports that two Thai businessmen sued issuer Tether in a New York district court over the freezing of $42.4 million in Tether USDt. The plaintiffs allege that Tether locked the funds in October without a warrant, acting on an informal request from US Homeland Security Investigations. A seizure warrant from the Eastern District of North Carolina arrived later in February 2026 as part of a $61 million pig butchering investigation, directing the tokens to be burned and reissued to a government wallet. The lawsuit challenges whether a private issuer has the legal authority to freeze secondary-market holdings before a formal warrant is issued. The plaintiffs are asking the court to unfreeze the and award punitive damages.
Crypto Industry Urges SEC Against Blanket Restrictions on Novel ETFs
Forcing crypto ETPs into the Investment Company Act framework would impose fund-level diversification rules incompatible with single-asset spot products.
Grayscale, a16z, and the Council for Innovation asked the Securities and Exchange Commission to avoid blanket restrictions on novel exchange-traded funds and instead evaluate products based on individual risk parameters. CoinTelegraph reports that the letters were dated August 31, following the close of a 60-day public-comment period that opened on June 30. The commenters opposed changing existing investment-company classifications in ways that could automatically sweep products holding non-securities into the Investment Company Act framework. firm a16z argued that crypto-based exchange-traded products benefit from established disclosure requirements and should not be grouped with products holding private . Grayscale supported optional confidential pre-filing processes, while a16z proposed reserving the label for funds under the Investment Company Act of 1940. Meanwhile, the Crypto Council for Innovation urged the regulator to create clearer registration-status disclosures rather than radically changing the current approval framework.
Expanding institutional access and tokenization initiatives contrast sharp regulatory enforcement and corporate delays. Whether stricter oversight and legal challenges will impede broader adoption remains an open question for market participants.
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