Regulatory Battle Over Crypto ETFs (Issue 3 · Week 30, 2026)

01Latest Developments

Latest Developments

The battle between bulls and bears in the derivatives market has intensified. On July 22, 2026, BTC rebounded to $66,000, but option skew indicated a fragile market balance, with bulls suffering significant unrealized losses recently. Earlier, on July 20, Deribit saw a call option straddle worth $2.5 billion, targeting the $70,000–$72,000 range; profits could only be realized if BTC broke through the $69,000 resistance level.

Institutional strategies have shown clear divergences. As of July 21, 2026, MicroStrategy’s reserves increased to $3.225 billion, but four weeks of selling stocks without purchasing more BTC reduced its per-share BTC holdings, turning its dilution ratio negative. On the same day, Coinbase’s stock price rose by over 12% following an agreement on the ethical framework for the CLEAR act. Traditional finance is accelerating its entry into this space—Morgan Stanley submitted revised applications for Ethereum and Solana spot ETFs on July 14, proposing a 0.14% fee structure along with a staking mechanism.

Macroeconomic and fundamental risks are intertwined. As of July 21, 2026, the U.S. federal debt reached $39.489 trillion, with the Treasury planning to raise $671 billion in Q3. Data revisions on August 3 could trigger volatility, forcing BTC to hold onto the $65,000 support level. In terms of regulation, the BIS warned that stablecoins with a market value exceeding $300 billion could lead to “digital dollarization,” undermining monetary sovereignty. Approximately 25% of USDT’s reserves consist of non-compliant assets, putting it under pressure due to the GENIUS act compliance deadline. In the industry sector, Hut8’s stock price soared by 200% due to a $9.8 billion AI deal, while its spin-off mining subsidiary ABTC tumbled by 76%.

02Impact Analysis

The competition among institutional investors has intensified, leading to a significant widening of market divisions. On July 18, 2026, Deribit saw the emergence of call spread contracts with a notional value of around $2.5 billion, betting on a moderate rise in BTC to $72,000. However, data from July 22 showed that despite BTC rebounding to $66,000, option skew indicators indicated a fragile market balance, with long positions suffering substantial losses recently. At the macro level, U.S. federal debt reached $39.489 trillion on July 21, and the Treasury planned to raise $671 billion in Q3 financing. Data revisions on August 3 are likely to cause volatility, putting to the test whether BTC can hold onto the $65,000 support level.

Structural shifts are taking place in the industry landscape. On July 20, Hut 8 signed a $9.8 billion agreement to lease AI data centers, driving mining company stock prices up by over 11% and accelerating their transition toward AI infrastructure. In contrast, the mining subsidiary ABTC, which was spun off by Hut 8 on July 22, saw its stock price plummet by 76%, reflecting a shift in capital preference from traditional mining to AI. Regarding regulation, on July 18, Morgan Stanley submitted revised applications for Ethereum and Solana spot ETFs, proposing a fee rate of 0.14%, signaling strong interest from traditional finance sectors. Yet, on July 20, compliance issues regarding USDT reserves emerged, with about a quarter of them involving non-compliant assets, leaving a two-year deadline for compliance—making the prospects for market access in the U.S. uncertain. MicroStrategy suspended coin purchases on July 21, increasing its reserves to $3.225 billion. The dilution ratio turned negative, prompting a reevaluation of its long-term strategy.

03Keep an eye on it later.

1. US Treasury Financing and BTC Liquidity: Keep an eye on the revision of US Treasury financing data on August 3, 2026. If a stronger dollar drives BTC below the $65,000 support level, it could trigger a liquidity crisis.
2. Option Key Price Battles: Monitor the $2.5 billion long-call spread strategy. BTC needs to break through the $69,000 resistance level to realize profits; otherwise, bulls may face a 20% loss risk in the near term.
3. Stablecoin Compliance Countdown: Approximately 25% of USDT’s reserves consist of non-compliant assets, leaving it with a two-year compliance deadline under the GENIUS Act. Its progress in gaining access to the U.S. market needs to be closely tracked.
4. Divergent Transformations Among Mining Companies: Mining firms like Hut 8 are accelerating their transition toward AI applications. However, rising computing power concentration (with the Nakamoto coefficient dropping to 3) and sharp declines in the stock prices of mining subsidiaries (such as ABTC falling by 76%) highlight structural risks within the industry.