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💸⚔️ BTC: Wall Street Just Killed Coinbase

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Hello there you embodiment of curiosity;

Welcome to today's edition of Osiris News. The "Trump Trade" is dead, but the "Trump Administration Trade" is just getting started. While proxy stocks like American Bitcoin are puking 50% on lock-up expiries, the actual asset class is quietly being integrated into the plumbing of the largest financial institutions on earth.

Bitcoin reclaimed $93,000 not on retail hype, but on a $38 billion liquidity injection from the Fed’s repo operations and a total capitulation from the old guard. The conversation has shifted from "will they ban it?" to "how fast can Schwab roll this out?" Larry Fink is on stage calling Bitcoin an asset of fear against government deficits, while Vanguard is quietly opening the gates. The suits aren't coming; they're already redecorating the lobby.

🔍 Quick Overview

• Institutional Adoption: Schwab confirms spot trading for 2026. Coinbase's zero-commission nightmare just got a date.

• Bitcoin: BTC reclaims $93k on Fed liquidity, not retail. The institutional bid is finally here.

• Ethereum: The Fusaka upgrade shipped, boosting L2s. The L1 remains slow until the 2026 upgrade.

• Self-Custody: Wrench attacks are surging. The primary driver for institutional custody is now physical safety.

• Regulation: CFTC approves a leveraged spot venue. States call prediction markets illegal gambling. Contradiction is policy.

Trending News

⚡️🏗️ Ethereum Built a Superhighway, But the On-Ramps Are Broken

The network successfully activated the "Fusaka" upgrade, introducing PeerDAS to massively boost data capacity for Layer 2s like Arbitrum and Base. While this lowers costs, Vitalik Buterin warns that L1 execution bottlenecks still hinder true global scalability.

⚖️✅ CFTC Approves First Spot Crypto Trading With Oversight

Chicago-based Bitnomial became the first US exchange authorized to offer margined spot crypto trading under direct CFTC supervision. This regulatory milestone firmly establishes Bitcoin as a commodity, offering a regulated domestic alternative to offshore leverage venues.

🏦🤝 Germany's Old Guard Builds Crypto Bridge With Kraken

Deutsche Börse Group partnered with Kraken to launch a fully regulated digital asset trading and custody venue for European institutions. The "full-stack bridge" integrates Clearstream’s $23T infrastructure to rival US-based ETF dominance in the institutional sector.

💰🔓 The Walls Are Down, But Crypto Is Still Locked Out

Vanguard reversed its strict "No Crypto" policy, finally allowing clients to purchase funds holding Bitcoin and other digital assets. Despite this pivot, subtle "soft bans" and high net-worth requirements continue to restrict widespread retail access to these products.

This tiny pause brought to you by “please let this help pay the bills” 👀

Beyond the Noise

The financialization of crypto has entered its final, most aggressive phase. Charles Schwab, which oversees $12 trillion in client assets, confirmed it will launch direct spot crypto trading in the first half of 2026. This isn't just another exchange listing; it’s a market structure shift. Schwab clients already hold nearly 20% of all crypto ETPs in the U.S. By moving to direct spot trading, Schwab cuts out the ETF management fees and, more importantly, threatens the fee dominance of Coinbase. If Schwab applies its zero-commission equity model to crypto, the margins for every crypto-native exchange will get crushed. Vanguard has simultaneously reversed its hardline "No Crypto" stance, allowing clients to access crypto funds. The walls are down, but the gatekeepers are now setting the toll prices.

This institutional embrace is happening against a backdrop of increasing physical danger for self-custody. We are seeing a grim bifurcation: digital safety is increasing via regulated custodians, while physical safety for individuals is degrading. Security reports indicate a surge in wrench attacks, physical violence, kidnapping, and torture, targeting crypto holders globally. There were 21 such attacks in the first five months of 2025 alone. Compounding this, Ledger’s security team identified a vulnerability in Android phones with Mediatek chips that allows attackers to bypass boot security via electromagnetic pulses. The message is clear: holding your own keys is becoming a high-stakes game of physical security, which ironically drives more capital back into the arms of Schwab and BlackRock.

On the protocol layer, Ethereum finally shipped the Fusaka upgrade. The headline feature, PeerDAS, allows nodes to verify data integrity by sampling small random chunks rather than downloading everything. This creates a massive capacity boost for Layer 2 networks like Base and Arbitrum, slashing their costs further. However, the market reaction was muted because, as Vitalik Buterin noted, this only solves data availability. The Layer 1 execution bottleneck remains. The network is building a superhighway for L2s while the L1 mainnet remains a slow, expensive country road. The fix for L1 execution isn't coming until the Glamsterdam upgrade in 2026. Until then, Ethereum is essentially a settlement layer for rollups, not a user-facing computer.

We are also witnessing a fascinating evolution in how value is captured on decentralized exchanges. Hyperliquid is running a live experiment with Builder Codes," allowing frontends to tack on their own fees (up to 1% on spot). This has sparked a frontend war. Nearly 40% of daily active users are now trading through third-party interfaces rather than the native site. This decouples the user relationship from the settlement layer, mimicking the traditional finance structure where Robinhood (the broker) owns the client and Citadel (the wholesaler) handles the execution. If these frontends become powerful enough to route orders to different backends, Hyperliquid risks becoming a commoditized utility while the interfaces capture the margin.

Regulatory clarity remains a jagged line. The CFTC just approved Bitnomial as the first U.S. exchange for spot crypto trading using borrowed funds. This is a massive win for the "crypto is a commodity" argument and provides a federally regulated onshore venue for the borrowed capital that usually sits on offshore platforms like Binance or Bybit. However, at the state level, Connecticut has issued cease-and-desist orders to prediction markets like Kalshi and Polymarket, classifying them as unlicensed gambling. While Google Finance integrates prediction market odds into search results, legitimizing them as data, state regulators are trying to shut them down. The federal government sees a commodity market; the states see a casino.

This Caught My Eye:

Here’s a breakdown:

• The chart shows a sharp late-November 2025 breakdown, marking a classic capitulation event where both price and liquidity collapsed simultaneously.

• This kind of move typically reflects forced selling from leverage wipeouts plus panic-driven exits, not a structural shift in long-term trend direction.

Looking Ahead

The immediate focus shifts to the Bitnomial launch scheduled for the week of December 8th. If institutional volume flows into this CFTC-regulated venue, it validates the thesis that capital wants to trade with borrowed funds but demands a U.S. regulatory wrapper. We also have the U.S. inflation data dropping on December 9th, followed by the Federal Reserve’s interest rate decision on the 10th.

The market is pricing in cuts, but the bond market is jittery about inflation re-accelerating. If the Fed signals a pause or a hawkish pivot, the liquidity fueling this $93k Bitcoin reclaim could evaporate. Until then, watch the flows into the new Solana ETFs; the recent $32 million net outflow suggests that while Wall Street loves Bitcoin, they are still dating Solana casually.

Until tomorrow,
- Dr.P