Crypto prices got absolutely rocked this week with Bitcoin falling nearly $15,000 in 24 hours—a bloodbath not seen since the collapse of crypto conman Sam Bankman-Fried’s empire back in 2022. On Friday, Bitcoin had clawed back most of those losses, and is now trading around $70,000, but the episode has left even longtime crypto insiders asking each other “What just happened?!” There are plenty of theories swirling around, but one is particularly compelling: The cause of the crash lies with Hong Kong traders who placed high-leverage Bitcoin bets that went horribly wrong.

That theory was put forth on X by Parker White, a former equities trader who is now COO at a crypto firm called DeFi Development Corporation. In a long thread, White said there is evidence pointing to the sudden implosion of Hong Kong hedge funds that held call options in BlackRock’s IBIT, which is the world’s biggest Bitcoin ETF.

White suggests that the hedge funds used the Yen carry trade (a form of interest arbitrage) to finance big positions in out-of-the-money IBIT options. This amounted to a risky bet that Bitcoin prices, which have been slumping since a big sell-off in October, would recover. The hoped-for rally didn’t arrive, however. Meanwhile, White speculates that the Hong Kong funds also got pummeled by headwinds in the Yen-carry trade—which made their financing more expensive—and exposure to recent convulsions in the silver market.

The upshot is the hedge funds faced a perfect storm and, as the crypto market slumped further this week, the value of their holdings declined until they got liquidated—forcing the mass sell-off of IBIT shares and a calamitous fall for Bitcoin. Here is how White explained what happened in trader-speak:

*Now, I could easily see how the fund(s) could have been running a levered options trade on IBIT (think way OTM calls = ultra high gamma) with borrowed capital in JPY. Oct 10th could very well have blown a hole in their balance sheet, that they tried to win back by adding leverage waiting for the “obvious” rebound. As that led to increased losses, coupled with increased funding costs in JPY, I could see how the fund(s) would have gotten more desperate and hopped on the Silver trade. When that blew up, things got dire and this last push in BTC finished them off.*

In his post, White also pointed out that the Hong Kong hedge funds, whose Bitcoin trading occurred only in the form of ETF shares, are not part of the traditional crypto ecosystem. This means that chatter about their predicament did not bubble up on “Crypto Twitter”—which is the go-to forum for industry news—and nor did it create counter-parties who incurred big losses, and would be likely to warn others.

White’s theory is just that, of course: no more than a theory. Meanwhile, history shows that major Bitcoin crashes have typically been touched off by multiple factors, not a single event. And indeed, this week’s crypto crackup coincided with a broader AI-related asset sell-off, uncertainty over the fate of a key blockchain bill, as well as crypto names appearing in the Epstein files—factors that all likely contributed to Thursday’s meltdown.

Still, White’s explanation is the most persuasive, and is further supported by other circumstantial evidence, including a recent decision by the Securities and Exchange Commission to lift limits on trading Bitcoin options.

Meanwhile, other longtime crypto figures expressed cautious support for the Hong Kong hedge fund theory. That included the respected venture capitalist Haseeb Qureshi who described the theory as plausible, but added that it may take months to wait for regulatory filings that could help confirm it, and that in some cases a key crypto player can “blow up” without anyone ever learning their identity. But for those who are confident that a hedge fund is at the root of this week’s market troubles, there is already a Polymarket forum to bet on the culprit.

What caused the massive Bitcoin crash? Clues point to a blow-up at Hong Kong hedge funds

The Hidden Culprit Behind Bitcoin's Epic Crash: Hong Kong Hedge Funds' Risky Bets Unraveled

XRP has plummeted over **50% from its peak**, but a lower price tag isn't enough to make it a buy. Here's what needs to happen before considering this cryptocurrency again.

Back in 2024, **XRP** looked like a promising investment. Ripple Labs was nearing the end of its long legal battles, and election results hinted at a more crypto-friendly administration. At that time, XRP traded at just **$0.70 per coin**, with a market value of **$41 billion**.

Things shifted dramatically. XRP skyrocketed, hitting **$2.70 by December 2** and **$3.30 in mid-January 2025**. At its peak, with a market value of **$182 billion**, only **Bitcoin** and **Ethereum** had a larger footprint.

![XRP Stock Quote](https://g.foolcdn.com/image/?url=https%3A%2F%2Fg.foolcdn.com%2Fart%2Fcompanylogos%2Fmark%2FXRP.png&w=128&op=resize)

That surge was **too much, too fast**. XRP was priced for perfection, leaving little room for gains and a steep downside. The coin was no longer a top choice.

The price chart has been diving since July, largely due to **macroeconomic uncertainty**. While this downturn affects most of the crypto market, XRP took a **deeper six-month dive** than Ethereum or Bitcoin. It's down more than 50% from the peak, and valuation isn't the main barrier anymore.

Overall, XRP has roughly doubled from 2024's election week, which seems appropriate given the lawsuit resolution. But I'm still not buying XRP until people and financial institutions actually start to use it.

## Show Me the Money (Moving Through XRP)

**XRP was designed to facilitate cross-border payments**. Ripple Labs pitched it as a faster, cheaper alternative to the **SWIFT network** used by banks today. The idea is compelling: international wire transfers can take days and cost a fortune in fees, while XRP transactions settle in seconds and cost fractions of a penny.

![Gold coins with the Ripple logo and high-denomination dollar bills.](https://g.foolcdn.com/image/?url=https%3A%2F%2Fg.foolcdn.com%2Feditorial%2Fimages%2F848142%2Fripple-and-cash.jpg&w=3840&op=resize)

So XRP sounds great on paper. In practice, Ripple has announced dozens of partnerships with banks and payment providers over the years. Most of these pilots never scaled into meaningful transaction volume. The company doesn't disclose how much XRP actually flows through its **On-Demand Liquidity (ODL) service**, leaving investors to rely on vague press releases.

I've been waiting for clear signs. Here's what would make me stop and possibly invest:

- **Transparent volume data**: Ripple publishing regular, audited reports on ODL transaction volume would help. Show me the receipts, please.
- **A big bank goes on the record**: Not a pilot or a vague partnership. I want a top-20 global bank stating, "We move billions of dollars with XRP."
- **Some defense against the competition**: **Stablecoins** and **central bank digital currencies (CBDCs)** are targeting the same cross-border payments market. XRP needs a reason to win beyond being first.

Without these signals, XRP remains a bet on potential rather than performance. Ripple has been making the same pitch for nearly a decade. I'd like to see it land before buying. Lower coin prices are a start, but serious real-world progress is essential.

XRP has dropped more than 50% from its peak, but I want more than just a lower price tag. Here's what needs to happen before I'd consider buying this cryptocurrency again.

Why I'm Still Not Buying XRP: The Critical Factor That Must Change First

**Bitcoin miner IREN faced a challenging quarter, missing analyst expectations while its AI services revenue showed significant growth.**

IREN stock continued to retreat early Friday after the bitcoin miner and artificial intelligence play late Thursday missed estimates for its fiscal Q2 2026. Shares tumbled more than 11% on Thursday as bitcoin undercut $63,000 to fall to 16-month lows.

**IREN reported a net loss of $155.4 million**, compared with net income of $19 million last year. Total revenue increased to $184.7 million from $114 million. Analysts polled by FactSet expected a net loss of $88 million on $224 million in revenue.

"Last quarter marked meaningful progress across capacity expansion, customer engagement and capital formation, reflecting IREN's progress as a scaled AI Cloud platform," co-CEO Daniel Roberts said in the release. "We are seeing the strongest demand environment to date, and importantly that demand is being met by a proven execution capability."

He added that the company has more than 4.5 gigawatts (GW) of secured power, while IREN is on track to reach its target of $3.4 billion in annual recurring revenue (ARR) by the end of the 2026 calendar year, according to the release.

**Bitcoin mining revenue surged almost 47% to $167.4 million** but fell short of views for $202 million. **AI cloud services revenue was $17.3 million for the quarter**, up from $2.7 million last year. FactSet expected $27 million in revenue for the segment.

IREN reported that cash and cash equivalents stood at $2.8 billion as of Jan. 31. The company noted that it has secured $9.2 billion in funding fiscal year-to-date across customer prepayments, convertible notes, graphics processing unit (GPU) leasing and GPU financing.

The company added that it has secured $3.6 billion in GPU financing for its **Microsoft deal from November**. That month, **IREN inked a $9.7 billion deal** to give Microsoft access to **Nvidia GB300 GPUs** over a five-year period.

## IREN Stock Performance

IREN fell about 5% early Friday. Shares initially more than 12% late Thursday after the report.

That followed a tumble of more than 11% Thursday as the price of bitcoin unraveled. The stock drilled further below its 50-day line after undercutting that moving average on Wednesday.

**IREN has fallen more than 48% from its 2025 high of 76.87 in early November**. The stock is approaching its December low of 33.34.

Meanwhile, the price of bitcoin on Friday recovered modestly to $68,000. Bitcoin on Thursday evening retreated near $60,000, which marked its lowest price since early October 2024.

Bitcoin miner IREN missed expectations for quarterly results late Thursday, but AI revenue picked up. The price of bitcoin is unraveling

Bitcoin Miner IREN's Q2 Miss Sparks Stock Plunge as AI Services Surge Amid Bitcoin's Volatility

**Bitcoin miner MARA has moved a staggering 1,318 BTC, valued at approximately $86.89 million, to various counterparties and custody venues over the past 10 hours**, according to on-chain data tracked by Arkham. This significant transfer is sparking intense speculation in the crypto community, especially amid recent market volatility.

![Arkham data visualization of MARA's Bitcoin transfers](https://www.coindesk.com/_next/image?url=https%3A%2F%2Fcdn.sanity.io%2Fimages%2Fs3y3vcno%2Fproduction%2Fb0636392c71ee0342bb041548539a69e0e226153-1199x782.jpg%3Fauto%3Dformat&w=3840&q=75)
*(Arkham)*

### Breakdown of the Transfers
- **The largest chunk, totaling 662.772 BTC (worth about $42.59 million), was sent to Two Prime**, a credit and trading firm. This included a major transfer of 653.773 BTC and a smaller top-up of 8.999 BTC shortly after.
- **Separate transactions directed 200 BTC and 99.999 BTC to a BitGo-tagged address**, amounting to roughly $20.4 million at the time.
- **Another 305 BTC moved to a fresh wallet**, valued at approximately $20.72 million.

### Why This Matters: Timing and Market Context
**The timing of these transfers is crucial**, as crypto markets have been experiencing sharp swings following a liquidation-driven selloff this week. Traders are on high alert for any signs that miners might be turning into forced sellers, which could exacerbate downward pressure.

**Large miner-related transfers like this can be routine**—such as treasury management, custody reshuffling, collateral moves, or preparation for an over-the-counter sale. However, in a thin market, they are often interpreted as a **supply signal**, potentially indicating bearish sentiment.

### Focus on Two Prime: Collateral or Strategy?
**The transfer to Two Prime is drawing particular attention** because it involves a credit and trading counterparty. If the Bitcoin is being posted as collateral or rotated into a trading strategy, it **does not necessarily imply immediate spot selling**. This nuance is key to understanding whether this move is a distress signal or part of standard operational adjustments.

### Broader Miner Stress Amid Bitcoin's Decline
**This activity comes during a challenging period for Bitcoin miners**, with the cryptocurrency down nearly 50% from its peak above $126,000 last year. **Bitcoin is currently trading about 20% below its estimated average production cost**, which is around $87,000 per BTC according to data from Checkonchain. Historically, trading below production cost has been a characteristic of bear markets, increasing financial strain across the mining sector.

**As the spot price hovers near a weekly low of $60,000**, the pressure on miners intensifies, making moves like MARA's worth watching closely for insights into market dynamics and potential future trends.

The largest transfers went to credit and trading firm Two Prime, which received more than 660 BTC, while additional chunks were sent to a BitGo address and a fresh wallet.

Bitcoin Miner MARA Shifts $87 Million in BTC: Is This a Bearish Signal or Just Routine?

## The $500M Deal That Went Unnoticed

Days before Donald Trump returned to office in January 2025, an investment firm controlled by a senior member of the United Arab Emirates royal family secretly **signed a deal to pay $500 million** to buy almost half of a cryptocurrency startup founded by the Trump family. Under any other president, such an arrangement would cause a political earthquake in Washington.

But this latest example of corruption involving Trump and his family business **hardly made a blip** over the past few days, relegated to a passing headline in a relentless news cycle often dominated by Trump's actions and statements.

## Why This Scandal Matters

This scandal deserves our attention: a **half-billion-dollar transaction with a foreign government official**, executed in the shadow of Trump's inauguration, which directly enriched the president and his family. The deal to acquire a 49% stake in World Liberty Financial, the crypto company founded by the Trump family and several allies in the fall of 2024 during Trump's presidential campaign, was backed by **Sheikh Tahnoon bin Zayed Al Nahyan**, one of the most powerful officials in the UAE.

Known as the "spy sheikh," Tahnoon is the brother of the UAE's president and serves as national security adviser. He also oversees one of the largest investment empires in the world, serving as chair of two Abu Dhabi sovereign wealth funds, which have $1.5 trillion in assets, and G42, a firm focused on artificial intelligence.

## The Pattern of Monetizing the Presidency

It's dizzying to keep up with the ways that Trump has **monetized the presidency** and used it for personal profit in his second term. The Trump Organization, run by the president's sons, has negotiated foreign real estate deals worth billions of dollars, some of which involve private companies backed by governments of the three wealthiest Arab petrostates: Saudi Arabia, Qatar and the UAE.

In May, as Trump prepared to visit the Middle East, Qatar's government donated a **$400 million luxury Boeing jet**, which is being refitted by the US military so Trump can use it as Air Force One. It was probably the most expensive gift from a foreign government in US history.

## The Crypto Connection

In late May, the president **hosted a private dinner** at his Virginia golf club for the 220 largest buyers of his memecoin, called $Trump, which is a type of cryptocurrency connected to an online joke or mascot and has no inherent value. The top 25 buyers in the crypto contest got invited to a VIP reception with Trump and a White House tour. In all, the Trump family's crypto business raked in **about $148 million** from the contest, most of it from foreign or anonymous buyers.

Despite the sheer scale of these conflicts surrounding Trump over the past year, the **$500 million deal involving World Liberty and the UAE's Tahnoon** is "the only known case of a foreign government official purchasing a major stake in a Trump company after his election." By intertwining his personal fortune with the ruling families of the Gulf, Trump has compromised his ability – and the ability of his entire administration – to negotiate foreign policy and act as an honest broker.

## The AI Technology Connection

Over the past decade, Tahnoon has steered foreign policy negotiations with the US over major issues including fighting terrorism, economic investments and securing UAE access to advanced computer technology. In March, he visited Washington and met with Trump, gaining access to top cabinet members and being feted at a White House dinner – honors normally bestowed on a visiting head of state. The public did not know about the secret deal Tahnoon's investment firm had signed two months earlier with the Trump family's crypto company.

Two weeks after MGX's $2 billion investment in the Trump family's crypto firm, the Trump administration **allowed the UAE to buy hundreds of thousands of advanced computer chips** critical for AI development. The chips are made by US companies, especially Nvidia, and the Biden administration had restricted how many chips certain foreign countries can buy to prevent the technology from being misused. But Trump scrapped those restrictions.

## The White House Response

The White House insists that there was **no connection between the World Liberty crypto transaction** and the administration's decision to sell AI technology to the UAE – and claims that Trump and Witkoff have no conflict of interest because they have stepped aside from their family businesses. "The president has no involvement in business deals that would implicate his constitutional responsibilities," the White House counsel, David Warrington, said on Sunday.

While Trump's aides argue that he's living up to the highest ethical standards, the Republican-led Congress has shown little interest in investigating an astonishing series of corrupt actions and self-enrichment that would have devastated any other presidency. And as Trump and his family tally the expanding profits from their crypto empire, the rest of us must reckon with the cost to our democracy.

A crypto startup founded by Trump’s family signed a huge deal with the UAE president’s brother. Where’s the political fallout?

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