WEEKLY CRYPTO MARKET UPDATE

Week Ending 26th February, 2026

---

HEADLINE

BTC US$73k. Sharp rally amid extreme fear.

---

IN MARKETS

Global risk assets staged a broad-based recovery this week as equity markets rebounded from recent volatility, with the S&P 500 gaining 2.1% and technology shares outperforming. The Federal Reserve maintained its dovish stance following softer-than-expected inflation prints, keeping rate cut expectations intact for Q2 2026. Treasury yields declined modestly, with the 10-year falling 8 basis points to 4.12%, supporting risk appetite across digital assets.

Bitcoin advanced to US$72,873, posting a 6.8% gain over the past 24 hours and marking a weekly increase of approximately 11.3%. Ethereum tracked closely at US$2,125 (+6.9% 24h), while XRP climbed to US$1.43 (+4.8% 24h) and Solana reached US$90 (+4.2% 24h). Intraday trading saw Bitcoin briefly touch US$74,000 before consolidating, with altcoins demonstrating strong beta to the upside move. Market structure improved notably, with spot volumes increasing 34% week-over-week and perpetual funding rates normalizing to neutral territory.

The Fear & Greed Index registered 22 (Extreme Fear), presenting a notable divergence from price action. This disconnect suggests institutional accumulation during retail capitulation, a pattern historically associated with durable bottoms. Options markets reflect cautious optimism, with 30-day implied volatility declining from 68% to 61%.

---

FROM THE OTC DESK

The dominant narrative this week centered on escalating tensions between the Trump administration and traditional banking interests over stablecoin regulation. President Trump publicly urged passage of the GENIUS Act and Clarity Act, directly attacking banks for "undercutting" crypto-friendly legislation. White House crypto advisor Patrick Witt rejected JPMorgan CEO Jamie Dimon's position that yield-bearing stablecoins should face bank-like regulation, while Eric Trump characterized banking opposition as "anti-American." This high-level political intervention followed a confirmed meeting between Trump and Coinbase CEO Brian Armstrong.

The regulatory clarity debate drove immediate price action, with Bitcoin surging through US$72,000 resistance as markets priced in increased probability of favorable stablecoin legislation. The administration's explicit support for yield-bearing products signals potential structural changes to dollar-denominated digital asset markets.

OTC Desk Activity:

• Net institutional buying observed in BTC and ETH spot markets, with block trades averaging US$15-25 million concentrated during Asian and London sessions
• Stablecoin rotation flows accelerating into USDC and newer yield products as regulatory clarity improves, with US$1.2 billion net inflows to compliant issuers
• Basis trading activity resuming as funding rates normalize, with hedge funds re-establishing cash-and-carry positions in 3-6 month tenors

---

KEY ECONOMIC CALENDAR

Monday, 2 March, 23:30 SGT – US Personal Income & Spending (Consensus +0.4%) Tuesday, 3 March, 00:00 SGT – US Core PCE Price Index (Consensus +2.6% YoY) Wednesday, 4 March, 21:15 SGT – US ADP Employment Change (Consensus +145k) Thursday, 5 March, 21:30 SGT – US Initial Jobless Claims (Consensus 215k) Friday, 6 March, 21:30 SGT – US Non-Farm Payrolls (Consensus +180k) Friday, 6 March, 21:30 SGT – US Unemployment Rate (Consensus 4.1%) Wednesday, 11 March, 03:00 SGT – FOMC Meeting Minutes Release

---

IN HEADLINES

Trump Administration Escalates Stablecoin Regulatory Battle with Traditional Banks

The White House intensified its confrontation with the banking sector over digital asset legislation this week, with President Trump posting on social media urging immediate passage of the GENIUS Act and Clarity Act while accusing banks of undermining crypto-friendly policy. The intervention followed a confirmed meeting between Trump and Coinbase CEO Brian Armstrong, suggesting coordinated strategy between the administration and major crypto platforms. White House crypto advisor Patrick Witt publicly rejected JPMorgan CEO Jamie Dimon's testimony that stablecoin issuers paying yield should be regulated as banks, arguing such frameworks would stifle innovation. Eric Trump, co-founder of World Liberty Financial, amplified the message by characterizing banking opposition as "anti-American." However, TD Cowen analysts cautioned that Trump's social media posts may be "not enough" to move legislation through Congress, noting that substantive committee negotiations remain stalled. For institutional desks, the administration's explicit backing of yield-bearing stablecoins creates potential alpha opportunities in compliant issuers while raising regulatory risk for non-compliant products. The political capital being deployed suggests stablecoin legislation remains a priority for the 2026 legislative calendar.

Federal Reserve Grants Kraken Master Account, Drawing Banking Industry Criticism

The Federal Reserve approved a master account application for cryptocurrency exchange Kraken, marking a significant expansion of direct central bank access for digital asset platforms. Traditional banking groups expressed being "deeply concerned" by the decision, arguing it creates competitive imbalances and circumvents established regulatory frameworks. The master account grants Kraken direct access to Fed payment systems, eliminating reliance on correspondent banking relationships and potentially reducing operational costs by 15-20 basis points on dollar settlements. This follows similar approvals for select crypto-native institutions and represents a material shift in Fed policy under the current administration. For institutional traders, the development improves settlement efficiency and reduces counterparty risk when transacting with Kraken, particularly for large block trades requiring same-day dollar settlement. The banking industry's opposition suggests further political friction ahead, with traditional financial institutions increasingly viewing direct Fed access for crypto platforms as existential competitive threats. Market participants should monitor whether additional exchanges receive similar approvals, which could trigger basis compression across venues.

A16z Targets US$2 Billion for Fifth Crypto Fund Amid Market Recovery

Andreessen Horowitz is seeking to raise US$2 billion for its fifth dedicated crypto fund, according to Fortune, signaling continued institutional conviction in digital asset venture opportunities despite recent market volatility. The fundraising target matches the firm's fourth crypto fund raised in 2022, suggesting limited LP appetite expansion but stable commitment from existing backers. A16z has deployed approximately US$7.6 billion across crypto investments since 2018, with notable positions in Coinbase, OpenSea, Uniswap, and Solana ecosystem projects. The timing coincides with improving regulatory clarity in the US and renewed interest in blockchain infrastructure following AI integration narratives. For public market participants, large-scale venture fundraising typically precedes increased M&A activity and token generation events 18-24 months forward, creating potential catalysts for liquid tokens in A16z portfolio companies. The firm's continued commitment at scale contrasts with several traditional venture firms that have scaled back crypto exposure, potentially concentrating returns among specialized managers. Market observers should track deployment pace and sector focus, as A16z allocations often signal emerging institutional themes.

Fairshake PAC Secures Early Wins in 2026 Congressional Primaries

Crypto-focused super PAC Fairshake celebrated victories for several pro-crypto candidates in the opening 2026 midterm congressional primaries, including Texas Democrat Representative Al Green. The PAC, which raised over US$200 million for the 2024 election cycle, has signaled similar spending levels for 2026 races targeting both primary and general election contests. Fairshake's strategy focuses on supporting candidates with favorable digital asset policy positions regardless of party affiliation, while opposing lawmakers who have blocked crypto legislation. The early primary successes suggest the PAC's messaging resonates with voters and that crypto policy is becoming a viable single-issue voting bloc in select districts. For institutional market participants, the growing political influence of crypto-aligned PACs increases the probability of favorable legislation passing in the 2027-2028 congressional session, particularly around stablecoin frameworks and custody regulations. The PAC's effectiveness also demonstrates the industry's maturation in traditional political engagement, moving beyond lobbying to direct electoral influence. Traders should monitor competitive races where Fairshake deploys significant resources, as outcomes may shift regulatory probability pricing.

International Watchdog Flags Stablecoins in Sanctions Evasion and Money Laundering

The Financial Action Task Force (FATF) issued warnings that stablecoins are increasingly being utilized for sanctions evasion and money laundering activities, citing specific cases involving Russia-linked entities and Southeast Asian criminal networks. The report identified gaps in cross-border stablecoin transaction monitoring and called for enhanced compliance frameworks, particularly for peer-to-peer transfers and decentralized exchange activity. FATF recommendations carry significant weight with global regulators and typically precede coordinated enforcement actions across member jurisdictions. The timing coincides with ongoing US legislative debates over stablecoin regulation, potentially providing ammunition for lawmakers seeking stricter compliance requirements. For institutional participants, the report increases regulatory risk for stablecoin issuers without robust KYC/AML programs and may accelerate bifurcation between compliant "institutional-grade" stablecoins and unregulated alternatives. Market structure could shift toward permissioned stablecoin networks with enhanced transaction monitoring, potentially reducing liquidity in certain trading pairs. Compliance-focused stablecoin issuers like Circle and Paxos may benefit from flight-to-quality flows, while algorithmic and decentralized stablecoins face increased scrutiny. Desks should review counterparty exposure to stablecoin issuers and assess regulatory risk in cross-border settlement workflows.

Morgan Stanley Names Coinbase and BNY as Custodians in Bitcoin ETF Filing Update

Morgan Stanley updated its proposed Bitcoin ETF filing to name Coinbase and Bank of New York Mellon as custodians, marking the first major Wall Street bank to formally advance spot Bitcoin ETF plans since the January 2024 approval wave. The dual-custody structure combines a crypto-native platform (Coinbase) with a traditional financial institution (BNY), addressing regulatory concerns around asset safeguarding while providing operational redundancy. Morgan Stanley's US$6.2 trillion in client assets makes it the largest wealth manager pursuing direct Bitcoin ETF exposure, potentially channeling significant retail and high-net-worth allocations into the product upon approval. The filing follows BlackRock's iShares Bitcoin Trust capturing US$37 billion in assets, demonstrating sustained institutional and retail demand. For crypto markets, additional ETF launches from major financial institutions provide incremental demand and legitimacy, though marginal price impact may diminish as the product category matures. The custody arrangement validates Coinbase's institutional infrastructure and could trigger similar partnerships between crypto platforms and traditional custodians. Market participants should monitor SEC feedback on the filing, as approval timelines and any novel requirements could set precedents for subsequent applications from other major banks.

---

Until next week, happy trading!