Cryptocurrency exchanges believed to be financing Russia’s war in Ukraine have been sanctioned by the U.K. government in the first attempt to prevent evasion via “dark networks.” The move indicates a new focus on digital sanctions evasion, and compliance teams should expect these rules to develop further, potentially in the EU and other jurisdictions.
Crypto
Arkansas Senate committee approves two bills to regulate cryptocurrency mining • Arkansas Advocate
An Arkansas Senate committee unanimously approved two bills Thursday that would regulate cryptocurrency mining operations, and the committee will reconvene Tuesday to hear more public comment on the policies.
Republican Sens. Joshua Bryant of Rogers and Missy Irvin of Mountain View introduced the bills Wednesday after the House approved resolutions Wednesday allowing them to be introduced during the fiscal session. The Senate approved identical resolutions April 11.
The discussion of whether and how much to regulate crypto mines on the state level arose from Act 851 of 2023, or the Arkansas Data Centers Act, which limited local governments’ ability to regulate crypto mines.
Crypto mines, large groups of computers that harvest digital currency, are often located in rural areas because they take up a lot of space. They also require significant energy to operate and water to keep computers cool.
There are crypto mines in DeWitt and in the Bono community near Greenbrier, and officials have raised concerns over foreign ownership and whether the mines pose a national security risk. Additionally, Greenbrier-area residents have filed a lawsuit claiming noise pollution from the local crypto mine, which is in Irvin’s district.
Six of eight crypto mining resolutions fall short in Arkansas House
Bryant’s bill, Senate Bill 78, would place noise limits on Arkansas crypto mines, prohibit them from being owned by certain foreign entities and allow local governments to pass ordinances regulating the mines.
The bill’s listed options for noise regulations include “using liquid cooling or submerged cooling” techniques, sealing computers into structures that minimize the sound heard outside, and being located at least 2,000 feet away from “the nearest residential or commercial structure.”
Residents or business owners within 2,000 feet of a crypto mine would be able to seek legal remedies regarding noise complaints in county circuit courts, Bryant said.
The bill also clarifies that individuals can engage in crypto mining from their homes without government interference, he said.
“Digital asset mining in the home is limited to the confines of what your utilities can provide you based on your normal retail rate,” Bryant said. “This is a hobby; this is something your personal computer is able to do if you so choose…If you want to operate a business out of your home with this and declare that, then you must follow local guidelines and local ordinances.”
Irvin’s bill, Senate Bill 79, would require crypto mines to be licensed by the state Department of Energy and Environment. It would also require the department to inform legislative committees of its crypto mine regulation methods.
Both bills contain emergency clauses, meaning they would go into effect immediately if Gov. Sarah Huckabee Sanders signs them into law.
Six more potential crypto regulation policies passed the Senate but failed in the House within the past week.
Senate Bill 78 largely accounts for one of the failed resolutions, which would have allowed local governments to regulate crypto mines and prohibit ownership of the mines by the list of foreign countries from which the federal International Traffic in Arms Regulations bans imports and exports.
Irvin said the two bills lay the groundwork to use “several layers of tools” to both regulate the crypto industry and have future discussions in the Legislature about whether to put additional regulations in place.
“There’s a lot we don’t know and that we still are learning, so I think we need the time to flesh all that out,” she said in an interview.
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Public comment
Jerry Lee Bogard and Kenneth Graves — both residents of Arkansas County, where the crypto mine near DeWitt is located — spoke in favor of both bills.
Graves is on the DeWitt School Board, and he said there is a school about two and a half miles from the crypto mine. Noise from the mine can travel up to eight and a half miles on a windy day, and he does not want the noise or the mine’s electricity usage to interfere with children’s education, he said.
Bogard runs the Grand Prairie Farming and Water Company, a water conservation business in Stuttgart, and he expressed concern about the effect of crypto mines on Arkansas’ groundwater supply. The Sparta/Memphis Aquifer in East Arkansas contains water clean enough to drink and does not recharge easily.
“One crypto mine may use a few million gallons of water,” Bogard said. “That’s not a big deal [by itself], but what is a big deal is that it’s coming out of an aquifer that we depend upon for human consumption. Twenty crypto mines may be a bit of a concern if you live nearby…any number of these small communities that have aging infrastructure and depend upon the Sparta Aquifer wells.”
John Bethel, director of public affairs at Entergy, answered questions from committee members about crypto mines’ impact on local electric grids.
Bethel said the utility company notifies customers who are straining the grid, such as crypto miners, that their access to electricity will be shut off if they do not reduce their usage. Customers who do not comply with the notification will receive financial penalties that Entergy will later retract if the customer only fails to comply twice in a year, Bethel said.
Committee chair Sen. Scott Flippo, R-Bull Shoals, said those who do not heed Entergy’s warnings might need to face stricter consequences.
Earlier Thursday, the Senate voted to suspend the rule requiring a bill not to be heard in committee under 24 hours after being introduced. Sen. Stephanie Flowers, D-Pine Bluff, expressed frustration that the vote might limit public comment, since her district includes part of Arkansas County.
Bryant and Irvin agreed, at Flippo’s suggestion, to refer the bills back to the committee next week so they can receive more public comment at Tuesday’s meeting.
Crypto
U.K.’s sanctions on cryptocurrency exchanges signal new focus on illicit digital financing – Compliance Week
Key Takeaways
- Lookonchain data shows the trader paid roughly 140 times LIT’s market price of $2.46 per token.
- Lighter burned 15.5M LIT, 6.3% of supply, on July 2 as its permanent buyback-and-burn program began.
- A whale lost $8.2M in Lighter’s thin ARC market in February, a caution for traders chasing the rally.
Paying 140 Times the Market Price
The transaction was flagged yesterday and the math behind it was brutal. At $2.01 million for 5,776 tokens, the trader paid an effective price of roughly $348 per LIT, about 140 times the token’s market price of $2.46 at the time of the trade. Had the same 1,126.44 ETH, implying an ether price near $1,784, been routed through a deep venue at market rates, it would have bought roughly 817,000 LIT. The wallet received 5,776.
Losses of this scale typically occur when a large market order is routed through an onchain liquidity pool with minimal depth and no slippage protection. Slippage refers to the gap between a trade’s expected price and its executed price; most decentralized exchange ( DEX) interfaces let users cap it, automatically canceling any order that would move the market beyond a set percentage. Whether the trader disabled that protection or used a custom route remains unclear.
The setup was especially dangerous because LIT’s float is unusually tight, given roughly 57% of the circulating supply is staked and another 145 million LIT sits locked in liquidity programs (while the token’s deepest markets sit on centralized exchanges and on Lighter’s own platform rather than in public pools).
In those conditions, a $2 million market order can exhaust a pool’s inventory within a single block, with arbitrage and maximal extractable value (MEV) bots capturing the difference almost instantly.
Why LIT Is Red-Hot
Lighter is an Ethereum-based decentralized exchange focused on perpetual futures, the derivatives category that turned rival Hyperliquid into one of crypto’s defining stories. The project describes itself as “the first exchange to offer verifiable order matching and liquidations while delivering best-in-class performance on par with traditional exchanges.”
LIT traded near $2.60 at the time of writing, up 22.5% in 24 hours and 53.3% on the week, making it the second most-searched coin on Coingecko. The token commands a $675 million market capitalization on 250 million circulating tokens, with $533.6 million in total value locked (TVL) on the platform and $116.76 million in daily trading volume.
Even after the rally, LIT sits 65.7% below its all-time high of $7.86 set Dec. 30, 2025 and roughly 245% above the $0.78 low it printed on March 31.
The surge follows a July 1 tokenomics overhaul in which Lighter said all LIT repurchased with protocol fees will be permanently burned. The first burn destroyed 15.5 million LIT, about 6.3% of the circulating supply, on July 2, and the team set a 6% staking yield target, with the platform directing more than 70% of its daily revenue to the buybacks.
Retail access is widening at the same time. Robinhood Wallet integrated Lighter’s perpetual futures last week, a catalyst that pushed LIT up 24% in a single day, while public praise from Ethereum co-founder Vitalik Buterin added further momentum.
Thin Markets Keep Claiming Victims
Sunday’s botched swap is not the first fortune lost on Lighter’s order books this year. In February, a whale lost $8.2 million attempting to squeeze the platform’s illiquid ARC perpetuals market, with about $2 million of the position liquidated directly on the order book.
Skeptics also note that only a quarter of LIT’s 1 billion total supply is in circulation, leaving a $2.7 billion fully diluted valuation and a long unlock runway once emissions resume. Whether the trader recovers anything is doubtful. MEV operators have occasionally returned funds captured in extreme slippage events, but such refunds are voluntary and rare.
Key Points
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Hyperliquid is the leader of the decentralized perpetual futures market.
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The trading activity it captures from that market generates a lot of fees.
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Those fees are almost entirely spent on buybacks of its own token.
Crypto bear markets, like the one we’re in right now, have a way of separating the wheat from the chaff in terms of what’s worth investing in. While the popular coins of yesteryear that were held up merely by the market’s hot air have now collapsed, many of them by 90% or more, a new generation of quality assets is rising, and they’re avoiding the flaws that made their predecessors also prone to having their value evaporate when the market cools.
One of those rising challengers is Hyperliquid (CRYPTO: HYPE), and it’s the top cryptocurrency to buy and hold at the moment. Here’s what’s special about it.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a “Double Down” signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same “Total Conviction” signal is flashing for a company 1/100th the size of Nvidia. Continue »
An investor sitting in a cafe leafs through a pair of notebooks.
Image source: Getty Images.
This coin has a tokenomics loop that pulls its weight
Hyperliquid is a decentralized exchange for financial derivatives that runs on its own blockchain. Users trade its most popular type of derivatives, perpetual futures, as well as spot token pairs, tokenized commodities, tokenized stocks, and even prediction markets, all from one platform.
Much as a company can buy back shares of its own stock to reduce the shares in circulation and thereby make the remaining shares more valuable, 99% of the platform fees on Hyperliquid go toward buying the network’s native token, Hype, on the open market. With more trading, more fees are generated, which in turn creates more buyback pressure. Around 46.8 million Hype, or 15.7% of its circulating supply, worth around $3.1 billion, has been bought back since the network’s launch in late 2024.
Its share of global perpetual futures trading volume (which includes platforms outside the crypto sector) is currently 7.4%. Among its peers running decentralized on-chain platforms for perpetuals, it controls 68.4% of the market by volume. It thus stands to capture a lot of the growth in perpetuals trading volume.
Another important capability is that, for a fee, anyone can deploy their own perpetuals market on Hyperliquid and then capture some of the fees generated from its volume. Those self-deployed markets make up around 33% of the network’s total volume, and they’re likely to be a driver of growth.
There isn’t a free lunch here
Every investment has risks, and Hyperliquid is no exception.
First, it can’t yet operate legally in the U.S., which locks it out of the largest pool of retail and institutional capital seeking exposure to its perpetuals. Its ceiling is capped for as long as this remains the case.
Second, and more importantly, the buyback mechanism could lose steam if trading volume drops, and competition from numerous other players, like Aster and Lighter, is fierce and intensifying. So competitors may well erode its early lead.
Finally, its supply isn’t fully circulating. 41.3% of its supply remains locked and is set to be issued in the future. If the pace of the buybacks doesn’t surpass the pace of the supply unlocks, holders’ value will be diluted tremendously. But so far, that hasn’t happened.
Hyperliquid is, in my view, the most compelling investment opportunity in crypto at the moment, and it’s worth buying and holding for at least a few years, with the understanding that it’s a pretty risky play.
Should you buy stock in Hyperliquid right now?
Before you buy stock in Hyperliquid, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Hyperliquid wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you’d have $418,761!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $1,195,804!*
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Alex Carchidi has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Hyperliquid. The Motley Fool has a disclosure policy.
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