Morning Briefing | Kalshi publicly announces first insider trading penalty; STS Digital completes $30 million funding round; American Bitcoin releases 2025 financial report.

Cryptocurrency trading platform STS Digital has raised $30 million in funding, led by CMT Digital.

According to ChainCatcher, cryptocurrency exchange STS Digital recently announced the completion of a $30 million funding round, led by CMT Digital, with participation from Kraken, Arrington Capital, and Fidelity Investments.

This platform focuses on providing institutional investors with options trading services for over 400 cryptocurrencies and acts as a market maker to offer liquidity. Founded in 2022 by former Credit Suisse and UBS traders Maxime Seiler and Gideon Hyams, STS Digital has grown to nearly 50 employees. The company tripled its revenue between 2024 and 2025 and has achieved profitability, with clients including well-known crypto firms such as the Uniswap Foundation. The company plans to use this funding round to expand its trading volume, serve a larger institutional client base, and increase its staff. Amidst the volatility of the crypto market, STS Digital believes that options trading provides institutional investors with a better risk management tool compared to perpetual contracts.

American Bitcoin Financial Report: Bitcoin reserves surpass 6,000, with full-year revenue exceeding $180 million in 2025.

Telegram's built-in encrypted wallet, TON Wallet, now offers features for earning rewards on Bitcoin, Ethereum, and USDT holdings.

ChainCatcher reports that, according to The Block, Telegram's embedded crypto wallet, TON Wallet, has announced an on-chain yield option for Bitcoin, Ethereum, and USDT holders. Users can deposit their assets into a "vault" to participate in on-chain strategies designed to generate floating yields.

The USDT strategy can achieve an annualized return of up to 18%, supported by the Re7 DeFi strategy; the ETH and BTC vaults extend the yield functionality to the two major crypto assets. This functionality is implemented through TON Wallet, with Morpho, TAC, and Re7 participating in the integration.

The head of Hong Kong-based cryptocurrency exchange AAX is suspected of embezzling over HK$600 million and has been charged with four counts.

According to ChainCatcher, citing Hong Kong media outlet Hong Kong 01, the Hong Kong cryptocurrency exchange AAX ceased operations in mid-November 2022 citing system maintenance and updates, leaving over 300 customers unable to recover nearly HK$100 million in assets.

Hong Kong law enforcement authorities, after investigation, discovered that the platform's shutdown was allegedly caused through false information and illegal means. The person in charge then fled Hong Kong with cryptocurrency wallets and private keys, but was later arrested upon returning. Hong Kong police stated today that a thorough investigation revealed losses totaling approximately HK$81 million to 191 victims. The AAX operator withdrew approximately HK$633 million worth of cryptocurrency after the platform ceased operations. He has been charged with three counts of theft and one count of fraud.

Dragonfly partners and former co-founders are in public dispute, with each side holding differing views on early history and investment leadership.

According to ChainCatcher, Dragonfly Managing Partner Haseeb Qureshi and former co-founder Alexander Pack (now co-founder of Hack VC) recently had a public argument on social media.

In an article, Haseeb recounted his experience building his venture capital firm, stating that Dragonfly's early brand and system were still in their infancy, and it only gradually developed and scaled up after he joined. Alexander Pack countered that Dragonfly had been co-founded by him and Feng Bo for over a year before Haseeb joined, and had already committed to leading investments in projects such as Bybit, Amber Group, and Crusoe; the announcements of these funds also predated Haseeb's arrival.

Haseeb subsequently responded that some of the other party's statements were inconsistent with the facts, and clarified the specific investment roles and decision-making processes for each project. The two sides continued to argue about the company's founding stage and investment contributions.

ZachXBT responded that they will no longer provide advance notice of survey information: it will depend on the type of survey.

According to ChainCatcher, in response to community users' questions about whether prediction markets will no longer provide advance notice of survey information, "Chain Detective" ZachXBT posted on the X platform that it will depend on the type of survey, implying that the release of survey notices will not be completely stopped.

ZachXBT previously announced that it would release an investigative report on insider trading, which sparked widespread discussion in the community. Some people believe that the investigated parties may theoretically use this information to make advance arrangements in the prediction market after learning that they have been identified, thus forming new insider trading. ZachXBT admitted that due to the fact that the case involves interviews with many people, information leakage may be unavoidable.

Kalshi publicly announced its first penalties for insider trading, involving a former gubernatorial candidate and MrBeast employees.

According to ChainCatcher, prediction market platform Kalshi has publicly disclosed its first cases of penalties for violations, involving former California gubernatorial candidate Kyle Langford and Artem Kaptur, a video editor under YouTube influencer MrBeast.

Langford was fined $2,246.36 and banned from the platform for five years for posting a video on the X platform showing him betting on his own election victory, violating the platform's rule against betting on candidates in related election markets. Kaptur was fined $20,397.58 and had his account suspended for two years for allegedly using insider information to trade approximately $4,000 in related markets during his time at MrBeast, generating unusually large profits. MrBeast's parent company, Beast Industries, stated that it has launched an internal investigation and emphasized its zero-tolerance policy towards such behavior.

Kalshi has reported both cases to the U.S. Commodity Futures Trading Commission, and the fines will be donated to a non-profit organization. The platform revealed that it has launched more than 200 investigations into insider trading in the past year.

WLFI's new proposal: Participation in governance voting will require staking, with a minimum lock-up period of 180 days.

ChainCatcher reports that WLFI has proposed a governance staking system to encourage more users to participate in governance. According to the proposal, in the future, using unlocked WLFI tokens to participate in governance voting will require staking, with a minimum lock-up period of 180 days.

The system will introduce a tiered node structure: regular stakers will receive an annualized reward of approximately 2%; users staking 10 million WLFI (approximately $1 million USD) can become nodes, enjoying the right to exchange stablecoins such as USDT and USDC at a 1:1 ratio with USD; users staking 50 million WLFI (approximately $5 million USD) can become super nodes, gaining direct access to the WLFI team for collaboration. The proposal requires a quorum of 1 billion WLFI voting tokens to be valid, and the voting period is 7 days. If approved, implementation will proceed in three phases.

Stablecoin payments are projected to reach $390 billion in 2025, with B2B transactions increasing by over 730% year-on-year.

According to a recent report jointly released by Artemis and Stablecon, as reported by ChainCatcher, the scale of business-to-business (B2B) stablecoin payments increased by over 730% year-on-year in 2025, with the total stablecoin payment amount soaring to $390 billion, more than double that of 2024. B2B transactions accounted for approximately 60% of this total. Meanwhile, stablecoin transactions linked to bank cards increased by 840% year-on-year.

In terms of cross-border payments, the United States is the largest recipient of stablecoin funds, receiving an average of nearly US$127 billion per month; China ranks second, with an average of about US$71 billion per month; and Hong Kong ranks third with nearly US$51 billion.

Artemis data scientist Andrew Van Aken points out that the countries with the highest stablecoin usage are often those with the largest payment volumes, and developed economies are also actively seeking innovative payment methods. B2B adoption is mainly concentrated among SMEs, driven by the need to shorten cross-border payment times and bypass cumbersome traditional banking processes.

Alan Howard's crypto incubator WebN has announced its impending closure.

ChainCatcher reports that WebN Group, a blockchain and Web3 incubator backed by billionaire Alan Howard, has announced its closure. According to sources, the organization has successfully completed its mission. WebN incubated several digital infrastructure startups in recent years, including tokenization specialist KAIO (formerly Libre), crypto staking platform Twinstake, blockchain infrastructure company TruFin, and zero-knowledge proof startup Geometry. In 2023, Laser Digital, a crypto partnership arm of Nomura Bank, invested in WebN.

Sources familiar with the matter said the WebN shutdown was unrelated to Howard's personal digital asset strategy, and some employees have moved to Brevan Howard's hedge fund. Despite the BH Digital digital asset fund losing nearly 30% last year, Brevan Howard remains optimistic about digital assets, and his venture capital business continues to focus on the broad opportunities in the field.

The two founders of a16z met with Republican senators at lunch to advance legislation on cryptocurrency market structure.

Caixin: Reports indicate that Chinese regulators are reviewing Jane Street's trading patterns in China's ETF market.

ChainCatcher reports that rumors are circulating that Chinese regulators are scrutinizing Jane Street's practices in the Chinese ETF market. However, a source close to Jane Street stated, "We know nothing about these rumors, have no reason to believe they are true, and should not associate these rumors with Jane Street."

This week, Jane Street, its co-founder, and two employees were charged with insider trading, fraud, and market manipulation, which are also accused of accelerating the $40 billion collapse of the TerraUSD (UST) stablecoin and its sister token Luna in 2022.

Founded in 1999, Jane Street is one of the world’s largest proprietary quantitative trading firms. In 2024, its net trading revenue exceeded $20 billion and its net profit was close to $13 billion. Unlike hedge funds, Jane Street does not accept funds from external clients, so its disclosure obligations are far lower than those of traditional asset management institutions. This structure has kept it mysterious for a long time.

Data: Vitalik continues to sell ETH, accumulating 17,196 coins, worth approximately $34.96 million.

The US government has profited nearly $20 billion from the Chen Zhi and Zhao Changpeng cases by leveraging its technological hegemony.

According to ChainCatcher, a report titled "Ready Player One: An In-Depth Analysis of the Global Virtual Currency Asset Harvesting Operation Under US Technological Hegemony," jointly released by the China National Computer Virus Emergency Response Center and other departments, reveals the process by which the United States uses its technological hegemony to harvest global virtual currency assets. According to incomplete statistics, from 2022 to 2025, the United States seized over $30 billion worth of global virtual currency assets through various cases, with the Chen Zhi case alone accounting for $15 billion, or 50%.

The report shows that in October 2025, the U.S. Attorney's Office for the Eastern District of New York announced criminal charges against Chen Zhi, founder of the Prince Group in Cambodia, on charges including wire fraud and money laundering. At the same time, it announced the confiscation of approximately 127,000 Bitcoins under his control, which were worth about $15 billion at the time, setting a record for the largest virtual asset confiscation in the history of the U.S. Department of Justice.

The case of Binance founder Changpeng Zhao is another typical example of the United States using judicial hegemony and technological surveillance to force global virtual asset platforms to comply with its regulatory rules, thereby achieving economic exploitation and the export of its rules.

From 2023 to 2025, the United States pursued both civil and criminal charges against Changpeng Zhao. Ultimately, Binance paid a $4.3 billion fine based on a plea agreement.

"During the investigation, the United States employed comprehensive technical monitoring methods, achieving full penetration and evidence collection of Binance's operational, user, and transaction data, demonstrating its technological advantages in the field of digital asset platform monitoring," Du Zhenhua further explained. He added that the United States used hacking techniques to penetrate Binance's internal servers, obtaining core operational data and executive communication records, proving that Binance executives were aware of US regulatory rules but deliberately circumvented compliance requirements.

The report also stated that from 2023 to 2025, hacker groups with US government backing launched targeted attacks against more than 20 mainstream virtual currency asset exchanges worldwide. The attack methods included backdoor implantation, spear phishing, and supply chain infiltration, with the main focus on stealing users' wallet private keys, platform transaction records, and compliance and regulatory information. The attack targets covered platforms in multiple countries and regions in Asia, Europe, and Africa.