New York Attorney General Letitia James and Manhattan District Attorney Alvin Bragg sent a letter to Congressional leaders criticizing the GENIUS Act. According to CNN, they contend the law lets issuers keep interest on assets backing flagged coins rather than prioritizing restitution; Chainalysis reports illicit crypto flows hit $154 billion in 2025 with stablecoins at 84%.

On February 2, 2026, South Korea's Financial Supervisory Service announced an AI upgrade to its VISTA system to detect unfair trading in the virtual asset market. The platform, trained on past scams such as wash trading and spoofing, uses high-performance GPU servers to scan massive datasets, flag manipulation patterns, and generate visual evidence across multiple tokens and exchanges.

On February 2 2026, newly released Department of Justice files on Jeffrey Epstein reignited online claims that he secretly steered Bitcoin's development and enabled code backdoors. Commentators focused on Epstein's indirect donations to MIT's Digital Currency Initiative, which briefly funded several Bitcoin Core developers, and tried to link this to the FBI's 2021 Colonial Pipeline ransom recovery. However, the reports emphasize that Bitcoin's open-source, decentralized governance and public code reviews undermine assertions of centralized control or hidden vulnerabilities attributed to Epstein.

On January 31, 2026, Solana-based DeFi platform Step Finance reported that attackers had compromised several treasury and fee wallets, moving roughly 261,854 SOL valued at about $30 million. Following the incident, the team began an investigation, contacted cybersecurity firms, and Defillama data showed the project's TVL had fallen to zero while the STEP token price dropped sharply.

A single wallet lost 4,556 ETH, worth about $12.25 million, in an address poisoning incident. Attackers crafted lookalike vanity addresses that appeared in the user’s transaction history, leading to a misdirected transfer. The case adds to a recent spate of large crypto thefts, including an almost $50 million loss in December 2025.

From January 31, 2026, the US SEC will operate with a sharply reduced staff as a partial government shutdown triggered by a funding lapse takes effect. Routine work in key divisions is paused, and only emergency matters tied to market integrity and investor protection will be handled. The disruption is expected to delay crypto rulemaking, product approvals and stablecoin-related guidance until full funding is restored.

According to the Flow Foundation, the network has permanently burned 87.4 billion counterfeit FLOW, marking the final step of its recovery from the December 27 security incident. The exploit in December 2025 let an attacker realize about $3.9M via bridges, while validators patched the issue within 24 hours and exchanges restored FLOW deposits and withdrawals.

In the first 30 days of 2026, Solana’s on-chain activity surged, with Nansen reporting active addresses more than doubling to over 5 million and daily transactions rising from 52 million to 87 million. Daily fee revenue also reached about $1.1 million, driven primarily by DEX and DeFi usage, while sectors such as gaming, NFTs and infrastructure showed additional growth. Other L1 networks, including Ethereum, BNB, Tron and Base, recorded their own gains in users and transactions over the same period.

Optimism governance approved proposal OP-0017, allocating 50% of Superchain sequencer net profits to monthly OP buybacks in a 12-month pilot starting February 2026. Conversions from ETH to OP will be executed via OTC desks and pause below $200,000 monthly revenue. A 31.34 million OP unlock is set for January 31.