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first_img EU Technology Chief: The EU AI Act is Sufficient to Address Uncontrolled AI Risks

European Union technology chief Henna Virkkunen stated that the EU's current artificial intelligence regulatory rules are sufficient to address the risks posed by uncontrolled AI entities. In an interview with Reuters on Friday, she mentioned that the safety and security of powerful models is a hot topic internationally, and Europe is well-prepared in this regard.The EU's Artificial Intelligence Act regulates based on risk levels and is one of the strictest AI regulatory frameworks in the world, having been passed two years ago. Virkkunen dismissed critics who believe the EU's AI rules are outdated, stating that the legislation covers the entire lifecycle of these models, and regulators are providing model evaluation guidelines for companies based on the recommendations of 60 AI experts.Previously, incidents involving OpenAI and Anthropic raised global concerns about the potential for uncontrolled AI entities to escape human control. The European Commission had requested detailed information about safety and security measures from over 30 unnamed AI companies at the end of August, and Virkkunen indicated that they are currently assessing these responses. Anthropic CEO Dario Amodei previously stated in a blog post that the rapid pace of AI development could, if left unchecked, "exceed our understanding and control systems capabilities."

first_img Hacken Report: Half of USDT is controlled by only two signing keys

Blockchain security company Hacken released an assessment report indicating that approximately half of the circulating USDT (about $91.3 billion on the Tron network) is controlled by a 2-of-3 multi-signature contract, which lacks built-in delays, cancellation processes, or reliable revocation mechanisms. Attackers only need to compromise two signature keys to change contract ownership, mint tokens, freeze addresses, clear frozen balances, or set transfer fees without accessing any user wallets. Hacken also discovered that Tether reuses the same set of six signature keys across three chains: Ethereum, Avalanche, and Celo, posing a risk of cross-chain spread.Meanwhile, stablecoin rating agency Bluechip upgraded Tether's company rating from D to C, citing that KPMG's audit showed Tether's reserves exceeded liabilities by $6.8 billion as of December 31, 2025. This is the first time Bluechip has adopted the expanded SMIDGE methodology, which incorporates Hacken's technical risk analysis. However, Hacken only gave USDT a cybersecurity score of 3.3 out of 10 and pointed out that the USDT smart contract does not have automatic reserve proof checks or a token minting cap. Once signers authorize a transaction, the contract can mint an unlimited number of tokens without a bank reserve proof.Hacken stated that it has not yet completed an equivalent assessment of Circle's USDC, and Bluechip's previous B+ rating for USDC was based on an old methodology, which cannot be directly used for technical comparison.

Report: The concentration of the DeFi treasury market is significant, with the top 5 managers controlling 69% of the funds

Vaults.fyi released the report "2026 DeFi Custody Market Status," covering 856 vaults, 131 custodians, and 18 protocols, with a total locked value of approximately $11.29 billion. Over the past year, the TVL on the supply side of DeFi decreased by 41.8%, while the TVL of custody vaults grew by 39%, increasing market share from 5.24% to 12.51%. The top 5 custodians manage 69% of the funds, and the top 10 account for 79.1%. The leading landscape has changed dramatically, with Sentora and Concrete not making the list a year ago, now ranking second and fourth, respectively, while Usual dropped from fourth to thirty-fourth.Morpho ranks first among protocols with a custody TVL of 46.2%, with the remaining 53.8% distributed across the other 17 protocols. Bitcoin collateral accounts for 54.1% of Morpho's top 25 stablecoin vaults (approximately $3.71 billion). In terms of address concentration, weighted by TVL, a single address holds an average of 47% of vault shares, with the top ten addresses collectively controlling 74%. About 33% of the custody funds require a multi-step redemption process, with a 7-day annualized yield median of 4.82%, which is 98 basis points higher than instant redemption vaults.The report also points out that traditional financial institutions such as Société Générale, Apollo, and JPMorgan have begun to deploy custody vault strategies.

The EU expands cryptocurrency restrictions on Belarus, prohibiting its citizens from controlling all cryptocurrency service providers under MiCA regulation

The European Union has further tightened restrictions on cryptocurrency assets related to Belarus, prohibiting Belarusian citizens and residents from owning, controlling, or managing cryptocurrency service providers regulated by the Markets in Crypto-Assets Regulation (MiCA). According to the Council Decision (CFSP) 2026/1847 passed by the EU Council, this measure is an extension of the EU's sanctions framework against Belarus's involvement in the Russia-Ukraine conflict.The new regulations will officially take effect on July 24, with the expanded restrictions on the cryptocurrency industry set to be implemented from August 25. According to MiCA, the affected services include operating cryptocurrency trading platforms, cryptocurrency exchanges, executing and transmitting customer orders, cryptocurrency issuance services, asset transfer services, investment consulting, and portfolio management.This restriction comes as the MiCA transition period ends on July 1. The EU had previously required unauthorized cryptocurrency businesses to cease related operations, or face regulatory enforcement. The EU stated that this expansion of restrictions is part of its efforts to combat the use of cryptocurrency platforms to evade sanctions against Russia. Previously, in the 21st round of sanctions against Russia, the EU had expanded the trading ban to 14 cryptocurrency-related service platforms outside the EU and established a mechanism to prohibit future transactions with any foreign cryptocurrency service providers identified as helping Russia evade sanctions. Market participants noted that as the MiCA regulatory framework is fully implemented, the EU is further strengthening its regulatory control over the cryptocurrency industry through licensing systems and sanction mechanisms.

FATF: DeFi with identifiable controllers should be regulated as virtual asset service providers

The Financial Action Task Force (FATF) stated in a report released on Tuesday that if identifiable individuals retain "control or sufficient influence" in DeFi arrangements, its rules apply, regardless of how decentralized the project claims to be.FATF noted that many DeFi projects still frequently exhibit centralized elements in practice, including the concentration of governance tokens, management authority, upgrade control, and fees and rewards flowing to insiders. The report categorizes DeFi into three types: those with identifiable controllers, those that are actually centralized but where operators are hidden, and those that are truly leaderless, with only the last category not subject to its standards.The report stated that nearly 93% of jurisdictions responding to the survey have not applied the relevant standards to any qualifying DeFi arrangements, with only 26 out of 142 jurisdictions having assessed risks, 4 having established licensing rules, and only 2 having registered or licensed relevant platforms. FATF requires countries to mandate or encourage DeFi projects to embed anti-money laundering controls into smart contracts or interfaces; for platforms that refuse to cooperate, jurisdictions may prohibit them from operating locally as a last resort. The report also stated that the total value locked in DeFi reached $86.6 billion this year, an increase of approximately 85% compared to 2023.
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