GSR Warns of a Major Capital Shift: BTC Takes a Back Seat Hotcoin Research | August 10-14, 2026

Crypto Market Performance

1. Regulatory Uncertainty: The CLARITY Act vote has been postponed to mid-September. If passed, the bill could significantly improve regulatory clarity and accelerate institutional participation. Further delays, however, could prolong policy uncertainty and weigh on risk asset valuations.
2. AI Continues to Draw Capital Away from Crypto: Market maker GSR points to the large-scale shift of capital toward AI infrastructure as a key reason behind Bitcoin's sluggish momentum this year. If the AI investment boom continues, liquidity conditions in the crypto market may take longer to recover.
3. Self-Custody Security Risks: A vulnerability involving Coldcard hardware wallets led to the theft of at least 1,730 BTC, worth more than $110 million. In the short term, the incident could drive some capital away from self-custody and toward regulated custody solutions and ETFs.

Market Highlights

1. SEC Delays Tokenized Securities “Innovation Exemption” Amid White House and Wall Street Pressure The SEC has delayed its planned “innovation exemption” for tokenized securities, which had been expected to be announced on August 14. The White House was reportedly concerned that the move could interfere with ongoing negotiations over the CLARITY Act, while Wall Street lobbying group SIFMA also opposed the proposal, arguing that tokenized trading platforms may not fit within existing best-price execution rules for the stock market. The combined pressure from Washington and traditional financial institutions has stalled the highly anticipated reform.
2. SEC Cancels Friday Meeting, Putting “Reg Crypto” Proposal on Hold The SEC also canceled a public meeting scheduled for Friday that was expected to discuss the proposed “Reg Crypto” registration exemption for crypto token issuers. The proposal included measures that would allow eligible startups to raise up to $5 million over four years without registration. With the meeting canceled, consideration of the proposal has been postponed, adding further uncertainty to the regulatory timeline.
3. CLARITY Act Vote Pushed Back to September, Extending the Regulatory Gap The U.S. Senate failed to advance the CLARITY Act to a vote before the August recess, delaying the vote until September. This marks another setback for the legislation. A White House crypto adviser blamed Democrats for the delay, while the crypto industry expressed disappointment over the lack of progress.
4. Bank of Russia Proposes Public Trading of BTC, ETH and USDT, With $3,650 Annual Cap for Retail Investors Under pressure from international sanctions, the Bank of Russia has released a set of recommendations proposing that Bitcoin, Ethereum and USDT be made available for public trading on regulated exchanges. To protect non-qualified investors, retail purchases would be capped at approximately $3,650 per year. This marks Russia's first concrete regulatory proposal since President Vladimir Putin signed a new digital currency law on August 4.
5. eToro Q2 Crypto Trading Volume Plunges 73%, While Net Profit Jumps 77% eToro's crypto trading volume fell 73% year over year in the second quarter, while the average investment per trade dropped 50% to $182. Supported by strategic acquisitions including Zengo and Bit2C, the company's net profit rose 77% to $53.48 million. The results highlight how institutional expansion and diversified revenue streams can help platforms navigate periods of weaker retail trading.
6. Bitcoin Holds Near $63K, Struggles in the $62,000–$65,000 Range BTC traded within the $62,000–$65,000 range throughout the week and briefly fell below $63,755 on August 12, while market sentiment remained in the "fear" zone, with the Fear & Greed Index at 36. Although spot Bitcoin ETFs recorded approximately $865 million in net inflows last week, around 1.79 million BTC were accumulated on-chain between $62,000 and $65,000, creating significant potential selling pressure from holders looking to exit near breakeven and limiting the scope for a rebound.
7. BTC at a Critical Level: $442M in Longs at Risk Below $63,351 On-chain data shows that the current positioning is highly vulnerable. If BTC falls below the $63,351 support level, approximately $442 million in long positions across major exchanges could face liquidation. Conversely, a move above $64,605 could liquidate around $267 million in short positions, potentially triggering a short squeeze.
8. Binance BTC Reserves Rise to a Six-Month High, Reversing the Tight Supply Trend According to CryptoQuant, Binance's BTC reserves have climbed to their highest level in six months, reversing the recent trend of tightening supply. The increase may be driven by factors such as institutional collateral transfers and market-making activity, but it has nevertheless raised concerns about potential selling pressure.
9. GSR: AI Investment Is Drawing Liquidity Away From Crypto Market maker GSR argues that Bitcoin's sluggish momentum this year is not driven by crypto-specific factors, but by a large-scale shift of capital toward AI infrastructure. Major technology companies are raising substantial amounts of capital through equity issuance to fund AI data centers and chip development, tightening liquidity across asset classes, including crypto. GSR expects that a slowdown in AI investment, combined with Federal Reserve rate cuts, could bring liquidity back to the market and support a recovery in BTC.
10. Coldcard Losses Mount: At Least 1,730 BTC Stolen Losses from last week's attack involving Coldcard hardware wallets continued to mount this week. As of August 11, Galaxy Research confirmed that at least 1,730 BTC, worth more than $110 million, had been stolen from more than 5,200 victim addresses. The incident highlights that even cold storage is not entirely risk-free, as attack methods continue to evolve and increase the operational risks of self-custody.

Macro Update

• On August 12, U.S. July CPI rose 3.4% year over year on an unadjusted basis, in line with the consensus forecast of 3.4%. The previous reading was 3.5%.
• On August 13, U.S. initial jobless claims for the week ended August 8 came in at 209,000, the highest since the week ended July 11 and above the consensus forecast of 202,000. The previous week's reading was revised up from 199,000 to 200,000.
• On August 14, the CME FedWatch Tool showed a 65.6% probability that the Federal Reserve would leave interest rates unchanged in September, while the probability of a 25-basis-point rate hike stood at 34.4%.

Looking Ahead

Industry Conferences

• Coinfest Asia 2026 will be held in Bali, Indonesia, from August 20 to 21.
• Bitcoin Hong Kong will be held in Hong Kong from August 27 to 28.

Key Events

• On August 19 at 22:30, the U.S. will release EIA crude oil inventory data for the week ended August 14.
• On August 20 at 20:30, the U.S. will release initial jobless claims data for the week ended August 15.

Project Updates

• Coinbase will launch US500 stock index perpetual futures on August 17, giving U.S. traders leveraged derivatives exposure to the performance of large-cap U.S. stocks. The product will be available on Coinbase Derivatives.
• Hashdex will close its Bitcoin ETF, DEFI, on August 17, its final trading day.
• Japanese convenience store chain Lawson will conduct an in-store stablecoin payment trial at its Lawson Gate City Osaki Atrium store on August 17.
• The Mesa Devnet upgrade is scheduled for August 19.
• The Move-to-Earn project Step App has announced its shutdown and will gradually wind down operations by August 21.

Token Unlocks

• Solv Protocol (SOLV) will unlock 613 million tokens on August 17, worth approximately $1.35 million and representing 12.9% of the circulating supply.
• LayerZero (ZRO) will unlock 25.69 million tokens on August 20, worth approximately $20.22 million and representing 4.4% of the circulating supply.
• KAITO (KAITO) will unlock 32.59 million tokens on August 20, worth approximately $13.46 million and representing 7.63% of the circulating supply.

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