Your Weekend Crypto Roundup | February 2026 (Week 1)

This Week at a Glance

U.S. liquidity crunch triggers $250B crypto sell-off
Tether hits $187B market cap as on-chain usage surges
Bhutan slashes Bitcoin holdings amid rising costs
Nevada court backs Coinbase’s prediction markets
Hong Kong prepares first stablecoin licenses

This week, crypto markets took a hit as U.S. liquidity tightened. The result was a $250 billion drop in value, showing that the sell-off was caused by broader economic factors, not problems within crypto itself. Bitcoin dropped along with tech stocks, traders reduced their positions, and spot trading volumes fell sharply.

Despite the turmoil, some areas showed stability. Tether increased its market share with record reserves and more on-chain activity. Meanwhile, Bhutan sold millions in Bitcoin to cover higher mining costs. Institutional strategies faced criticism, and stablecoin issuers raised concerns about tougher regulations.

On the innovation front, blockchain-powered AI agents are growing more popular, and tokenized diamonds show growing real-world adoption. Regulators were also active this week, with new court decisions in the U.S. and licensing plans in Hong Kong.

Whether markets are crashing or climbing, one thing stays constant: the need for clear, honest insight. That’s what this roundup aims to provide. Subscribe to get updates every week.

Lead Story of the Week:

Crypto Sell-Off Fueled by U.S. Liquidity Crunch, Not Market Failure (More)

Raoul Pal says the $250 billion crypto market sell-off was driven by tightening U.S. liquidity rather than weaknesses in crypto. He noted that Bitcoin and SaaS stocks fell together, showing a macroeconomic shock. Rising gold prices, Treasury cash withdrawals, and an empty reverse repo facility drained liquidity, hitting long-duration and high-risk assets hardest. Read the full story.

Other News Making Waves

Markets & Trading

Tether’s USDt Strengthens Lead with Record Q4 2025 Growth (More)

Tether’s USDt ended Q4 2025 with a record $187.3 billion market cap, adding $12.4 billion despite broader market weakness. On-chain usage reached new highs, with nearly 25 million active wallets and $4.4 trillion in quarterly transfers. Reserves climbed to $192.9 billion, supported by $141.6 billion in U.S. Treasury holdings.

Bhutan Liquidates $22M in Bitcoin Amid Rising Mining Costs (More)

Bhutan has sold $22 million worth of Bitcoin from its state-backed mining reserves as prices fall and mining profitability declines. Since the 2024 halving, production costs have nearly doubled, and output has slowed. The country’s holdings have dropped from over 13,000 BTC in 2024 to about 5,700 BTC, reflecting financial pressure on its mining program.

U.S. Funding Deal Triggers Bitcoin Bounce, But Risks Persist (More)

Bitcoin rebounded from $72,900 after U.S. lawmakers passed a $1.2 trillion funding bill, easing government shutdown fears. The sell-off cleared excess leverage, stabilizing prices. However, renewed political deadlines, rising geopolitical tensions, and uncertainty around Federal Reserve leadership among others continue to weigh on sentiment, as we saw even sharper dips to around $60,000 in the days following.

Spot Trading Volumes Plunge as Investors Retreat from Crypto (More)

Spot trading activity on major crypto exchanges has fallen sharply since October, with volumes dropping from $2 trillion to about $1 trillion by January. Bitcoin has declined over 37% from its peak, while Binance volumes were cut in half. Analysts say reduced demand, risk aversion, and lingering uncertainty are driving investors away from active trading.

Technology & Innovation

Andreessen Horowitz says blockchains could power AI agents with identity, payments, and automation systems. (More)
Stablecoin dusting surged after Ethereum’s Fusaka upgrade, now distorting transaction and address activity metrics. (More)
Billiton and Ctrl Alt tokenized $280 million worth of diamonds on blockchain in a major UAE initiative. (More)

Corporate, Business & Institutional Developments

Tether reduced its fundraising target to $5 billion after investors rejected a $500 billion valuation. (More)

Tom Lee defended Bitmine’s Ethereum treasury strategy despite over $6 billion in unrealized losses. (More)
Circle warned companies against issuing their own stablecoins, citing heavy compliance, liquidity, and operational risks. (More)

Regulation & Policy Watch

A Nevada court refused to block Coinbase’s prediction markets, giving the exchange time to challenge regulators. (More)
The U.S. House launched an investigation into a $500 million UAE stake in a Trump-linked crypto project. (More)
The CFTC dropped plans to ban political and sports prediction markets and proposed new regulations. (More)
South Korea deployed AI surveillance systems to detect and punish unfair cryptocurrency trading practices. (More)
Hong Kong’s regulator plans to issue its first stablecoin licenses in March 2026. (More)

Market Movers: Winners and Losers

Top 5 Gainers 📈

Huobi BTC +3189.90%, from $1,354.33 to $44,546
Buttcoin +153.30%, from $0.00942681 to $0.02387986
Cysic +67.90%, from $0.194599 to $0.326763
Pocket Network +90.80%, from $0.01060945 to $0.02024540
Coin98 +49.30%, from $0.01953260 to $0.02916453

Top 5 Losers 📉

River -65.04%, from $36.24 to $12.67
Quai Network -58.30%, from $0.085146 to $0.03552424
Surge -46.40%, from $0.076508 to $0.04102955
Useless Coin -47.70%, from $0.060092 to $0.03141580
Planet IX -44.00%, from $0.226112 to $0.126743

Data source: CoinGecko

Project Spotlight

Payy Launches Privacy-Focused Ethereum Layer-2 for Institutional Stablecoin Transfers

Payy has launched a new Ethereum layer-2 network that lets institutions, fintech companies, and crypto users make private ERC-20 transactions. The network uses built-in privacy pools so users can hide who they are sending money to, without changing smart contracts or using extra tools. It works with MetaMask and other EVM wallets, and supports all ERC-20 tokens, focusing mainly on private stablecoin transfers. When users interact with DeFi apps, funds are withdrawn to new addresses to keep transactions private while still being easy to use.

Why It Matters:
Payy’s network helps solve a big problem for institutions using crypto by offering privacy, a design that meets compliance needs, and simple usability. It could speed up the move of stablecoins and payments to blockchain without revealing sensitive financial information.

Disclaimer: This roundup is intended solely for informational purposes and should not be considered trading or investment advice. Nothing herein should be construed as financial, legal, or tax advice. Trading or investing in cryptocurrencies carries a considerable risk of financial loss. Always conduct due diligence.

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