Tag: Business – Decrypt

Like a scene out of the 1980s sci-fi classic films “The Terminator” and “WarGames,” modern artificial intelligence models used in simulated war games escalated to nuclear weapons in nearly every scenario tested, according to new research from King’s College London.

In the report published last week, researchers said that during simulated geopolitical crises, three leading large language models—OpenAI’s GPT-5.2, Anthropic’s Claude Sonnet 4, and Google’s Gemini 3 Flash—chose to deploy nuclear weapons in 95% of cases.

“Each model played six wargames against each rival across different crisis scenarios, with a seventh match against a copy of itself, yielding 21 games in total and over 300 turns,” the report said. “Models assumed the roles of national leaders commanding rival nuclear-armed superpowers, with state profiles loosely inspired by Cold War dynamics.”

Edward Geist, a senior policy researcher at the RAND Corporation said the escalation rate may reflect the design of the simulation rather than an inherent tendency of the models themselves.

“My concern about this work is that the simulator appears to be structured in a way that strongly incentivizes escalation,” Geist told Decrypt.

In the study, AI models were placed in high-stakes scenarios involving border disputes, competition for scarce resources, and threats to regime survival. Each system operated along an escalation ladder that ranged from diplomatic protests and surrender to full-scale strategic nuclear war.

Geist said the study’s outcome data raised questions about how the simulation defined victory.

“You read the paper and it has this breakdown of who won each of the games, and it turns out that all of these games have a winner,” he said. “But three of these games involve strategic nuclear use, which suggests that the way the simulator is set up—it makes nuclear wars good and easy to win.”

According to the report, the models generated roughly 780,000 words explaining their decisions, and at least one tactical nuclear weapon was used in nearly every simulated conflict.

“To put this in perspective: The tournament generated more words of strategic reasoning than War and Peace and The Iliad combined (730,000 words), and roughly three times the total recorded deliberations of Kennedy’s Executive Committee during the Cuban Missile Crisis (260,000 words across 43 hours of meetings),” researchers wrote.

During the war games, none of the AI models chose to surrender outright, regardless of battlefield position. While the models would temporarily attempt to de-escalate violence, in 86% of the scenarios, they escalated further than the model’s own stated reasoning appeared to intend, reflecting errors under simulated “fog of war.”

According to Geist the game’s scoring logic appeared to reward the side with a marginal advantage at the moment nuclear war was triggered.

“So he who dies with the most toys wins in the simulation,” he said.

While the researchers expressed doubt that governments would hand control of nuclear arsenals to autonomous systems, they noted that compressed decision timelines in future crises could increase pressure to rely on AI-generated recommendations.

The research comes as military leaders increasingly look to deploy artificial intelligence on the battlefield. In December, the U.S. Department of Defense launched GenAI.mil, a new platform that brings frontier AI models into U.S. military use. At launch, the platform included Google’s Gemini for Government, and thanks to deals with xAI and OpenAI, Grok and ChatGPT are also available.

On Tuesday, CBS News reported that the U.S. Department of Defense threatened to blacklist Anthropic, the developer of Claude AI, if it was not given unrestricted military access to the AI model. Since 2024, Anthropic has given access to its AI models through a partnership with AWS and military contractor Palantir. Last summer, Anthropic was awarded a $200 million agreement to “prototype frontier AI capabilities that advance U.S. national security.”

However, according to a report citing sources familiar with the situation, Defense Secretary Pete Hegseth gave Anthropic until Friday to comply with the Pentagon’s demand that its Claude model be made available. The department is weighing whether to designate Claude a “supply chain risk.”

Axios reported this week that the Department of Defense has signed an agreement with Elon Musk’s xAI to allow its Grok model to operate in classified military systems, positioning it as a potential replacement if the Pentagon cuts ties with Anthropic.

OpenAI, Anthropic, and Google did not respond to requests for comment by Decrypt.

Editor’s note: Adds comment from RAND Corporation policy researcher Edward Geist after publication

Publicly traded artificial intelligence and livestreaming firm GD Culture approved the sale of some of its 7,500 Bitcoin, or around $518 million worth, as part of its effort to fund a new share repurchase program, the firm announced on Wednesday. 

The program, approved earlier this month by the firm’s board of directors, authorizes it to repurchase up to $100 million in GD Culture shares (GDC) intermittently over the next six months. 

“The board’s authorization permits the company to execute the Bitcoin sales in one or more transactions, from time to time, as management determines to be in the best interests of the company and its shareholders,” the firm said in a statement. 

“Proceeds from the Bitcoin sales are expected to be used to fund repurchases of the company’s common stocks pursuant to the share repurchase program.” 

While the firm is authorized to sell all of its Bitcoin holdings, it is under “no obligation” to sell any specific amount and the program can be modified or discontinued at any time, according to its announcement. 

GD Culture picked up the 7,500 BTC last September when it entered into a share agreement to acquire Pallas Capital and its holdings. Now it can start to sell off its treasury if it wishes to, though its total holdings are worth around five times more than the approved amount for share repurchases. 

Shares in the firm are up around 21% following the news, recently trading at $4.04 but have still fallen more than 10% in the last month.

It’s not the first crypto treasury to offload some of its crypto assets in order to fund share repurchase agreements. In October, Ethereum treasury firm ETHZilla sold around $40 million in ETH to help buy back shares as its stock traded below the value of its net assets. 

Other firms have recently sold Bitcoin to fund other initiatives as well. Riot Platforms dumped $200 million in BTC during November and December amid what analysts believe is a bid to fund its AI initiatives. 

Earlier this month publicly traded miner Cango did the same, parting ways with $305 million worth of the top crypto asset. 

A representative for GD Culture did not immediately respond to Decrypt’s request for comment. 

Traders betting against the prices of major cryptocurrencies are feeling the pain Wednesday as Bitcoin, Ethereum, and other top assets are well in the green, leading to hundreds of millions of dollars’ worth of short position liquidations.

Bitcoin (BTC) has rebounded to nearly $69,000 for the first time in more than a week, recently trading for $69,869 after falling below the $63,000 mark on Tuesday. While up more than 7% on the day, the price of the leading cryptocurrency remains down more than 21% over the last 30 days.

Altcoins Ethereum (ETH) and Solana (SOL) are the biggest gainers among the top 10 coins by market cap, with Ethereum rising 12% on the day to a recent price of $2,075 while Solana has jumped almost 14% to just shy of $89. Both coins had shown substantial losses in recent weeks, but are swinging back the other direction on Wednesday.

Overall, the crypto market has climbed by about 6.6% over the last 24 hours, per data from CoinGecko. Other major gainers with double-digit rises during that span include Polkadot (DOT), Filecoin (FIL), Uniswap (UNI), Aptos (APT), Avalanche (AVAX), and Chainlink (LINK).

More than $400 million worth of short positions have been liquidated in the last 24 hours, per data from CoinGlass, making up the vast majority of the $463 million worth of total liquidations during that span.

Bitcoin currently leads the list with about $200 million worth of liquidations, with Ethereum next up with $153 million worth and Solana well behind in third with about $22 million.

Prominent crypto stocks are skyrocketing Wednesday as the risk-on appetite grows in equities, with USDC stablecoin issuer Circle showing a 29% spike to $79 per share after reporting earnings, while blockchain lender Figure is up 15% to $34 per share and Ethereum treasury leader BitMine Immersion Technologies has swung up almost 14% to $22.

Other notable crypto stock gainers today include Coinbase with a 13% swing to $183, Bitcoin treasury giant Strategy rising nearly 9% to above $135 per share, and Bitcoin miner MARA Holdings with a 7% rise to $8.66.

While still bearish overall, users on Myriad—a prediction markets platform operated by Decrypt‘s parent company, Dastan—are gaining more confidence that Bitcoin will continue rising. They currently pencil in a 43% chance that Bitcoin will next rise to $84,000 rather than fall to $55,000, with odds rising about 14% in the last day.

The UK’s top financial regulator announced Wednesday that it has selected four crypto firms to participate in a risk-free regulatory sandbox that will inform how the agency shapes stablecoin rules later this year.

The Financial Conduct Authority (FCA) chose neobank startup Revolut to participate in the sandbox, along with three other companies: Monee Financial Technologies, ReStabilise, and VVTX. All of the companies have existing stablecoin-related projects.

Decrypt reported last year that Revolut is mulling launching its own stablecoin, though the company has not yet made any announcements on the subject. Users on Myriad Markets—a prediction market operated by Decrypt’s parent company, Dastan—currently estimate that odds stand at 34% that Revolut will announce such a token before July.

The FCA’s stablecoin sandbox will allow the company, along with the three others, to trial stablecoin-related products in real-world conditions without fear of regulatory repercussions. The testing will focus primarily on stablecoin issuance, the FCA said.

The UK is currently developing its own rules regarding stablecoins, which are set to be finalized later this year. The results of the stablecoin sandbox program will directly impact the shape of those rules.

“The four selected firms’ proposals represent a range of stablecoin use cases, including payments, wholesale settlement and crypto trading,” the FCA said Wednesday. “Each firm will receive feedback from FCA specialists while helping to shape the UK’s regulatory approach.”

The companies were chosen from a pool of 20 applications, the FCA noted.

The United States passed its own stablecoin regulatory regime, the GENIUS Act, last summer. UK banking leaders have emphasized the importance, in recent months, of not falling behind America’s pace of establishing crypto regulations.

In September, both countries announced a joint crypto regulatory task force, chaired by officials from both the U.S. Treasury Department and His Majesty’s Treasury. The aim of the task force is to increase links between the American and British capital markets and reduce barriers between both nation’s crypto sectors.

The group, dubbed the Transatlantic Taskforce for Markets of the Future, is expected to release a report on its findings this summer.

Kalshi revealed enforcement actions against two traders on Wednesday, saying a political candidate in California and YouTube video editor who worked for MrBeast conducted insider trading on its prediction markets platform.

The cases are among the first that Kalshi has made public after sifting through a monthslong backlog of suspicious trading activity. They resulted in fines and disciplinary actions, as well as referrals to the CFTC, according to a blog post draft shared with Decrypt.

One of the individuals, identified as Artem Kaptur by Kalshi, was employed by YouTube star MrBeast, whose real name is James Stephen Donaldson. The other individual was identified as Kyle Langford, a 24-year-old Republican political candidate in California.

Kalshi said the insider linked to MrBeast traded around $4,000 on YouTube “streaming markets,” where people can wager on which words MrBeast will say in his videos. Kaptur was fined more than $20,000 and suspended from the platform for two years, Kalshi added.

Prediction markets centered around predetermined outcomes, such as edited YouTube videos, have drawn skepticism because they are susceptible to insider trading and manipulation by the content creators themselves. Unlike a sporting event or a political election—where the outcome is determined by external, uncontrollable forces—the “truth” of a YouTube video is tailored.

The insider linked to MrBeast exhibited “near-perfect trading success on markets with low odds,” which was flagged by Kalshi’s surveillance systems, the firm said. Meanwhile, several users flagged suspicious activity in associated trading data to the company.

An investigation conducted by the prediction market startup determined that the video editor “likely had access to material, non-public information connected to his trading” based on his employment. 

Following the original publication of this story, Beast Industries—the firm behind MrBeast’s growing content and packaged products empire—said it was taking action to prevent similar situations in the future.

“Beast Industries has no tolerance for this behavior, whether by contestants or our own employees,” the spokesperson said. “We have a longstanding policy in place against employees using proprietary company information which safeguards the highest standards and ethics throughout our organization.”

“With regard to this particular matter, we’ve already initiated an independent investigation as part of our overall ongoing efforts to ensure the integrity of our workplace and trust with our global audiences,” they added. “We welcome Kalshi—and hopefully others in the space—also taking this issue seriously, but it only works if they are willing to communicate their findings, so we’re hopeful they’ll be more open to that in the future.”

Beast Industries did not specify whether it has taken any action against Kaptur. Decrypt inquired for more information.

Furthermore, the spokesperson said that Beast Industries prohibits employee “wagering, betting, or [use of] prediction markets that could involve or be influenced by proprietary company information.”

Additionally, the company said it will ensure that all contestants of its “Beast Games” show know that “access to confidential information explicitly precludes them from profiting, monetizing, or benefiting (financially or otherwise) from their access or participation in these markets.”

The individual who appeared to be Langford wagered $200 on their own gubernatorial bid in California before pivoting to a Congressional run. Kalshi said that wager was telegraphed on social media, but he isn’t the only candidate for office in the U.S. that’s done that.

Klashi indicated that the politician was fined $2,200 and banned from the platform for five years. It views self-wagers as a form of market manipulation. Langford predicted that he would become California’s next governor on Kalshi last year, per Event Horizon.

Decrypt has reached out to Langford for comment.

Kalshi said that it plans to donate fines to a nonprofit providing education on derivatives. Moving forward, it aims to publish information about investigations on a quarterly basis.

Kalshi is required to report cases to the CFTC, but the exchange is trying to use that obligation as an opportunity to distinguish itself within a sector that critics argue is lightly regulated.

When it comes to policing traders’ activity, Kalshi Enforcement Head Robert DeNault told Decrypt last week that “source agency” trading is among the firm’s biggest focuses.

If a trader is affiliated with the entity responsible for an event’s resolution on Kalshi, they are barred from the market. As an example, he referenced the “legal duty” that background dancers from the Super Bowl halftime could have to refrain from trading due to confidentiality clauses.

“Those are types of policing activity that we might see on the exchange that you wouldn’t see necessarily from a federal regulator,” he said. “‘Insider’ does have a real legal meaning, even though it’s not actually defined in any statute.”

Editor’s note: This story was updated after publication to include comments from Beast Industries.

U.S. Senator Richard Blumenthal (D-Conn), the top Democrat on the Senate Permanent Subcommittee on Investigations, has opened a preliminary inquiry into Binance following reports that the cryptocurrency exchange allowed $1.7 billion in transactions tied to Iranian entities and Russia’s sanctions-evading oil trade.

The probe follows reporting by The Wall Street Journal alleging that internal Binance investigators uncovered transfers from accounts on the platform to intermediaries connected to Iran, including entities linked to the Islamic Revolutionary Guards Corps and Yemen’s Houthi militants.

According to the report, two Hong Kong-based partners—Hexa Whale and Blessed Trust—acted as conduits for some of the transactions. The articles said investigators identified roughly 2,000 accounts associated with Iranian entities despite Binance’s stated ban on Iranian users, and that some compliance staff who raised concerns were later suspended or dismissed.

Binance has denied the allegations. In a tweet posted Tuesday, CEO Richard Teng accused the WSJ of publishing “defamatory claims” about the company’s compliance program and said the outlet failed to acknowledge corrections provided by the exchange.

In a legal letter to the newspaper, Binance said it wants the “false information” corrected immediately and the “defamatory imputations retracted.”

Binance has said its sanctions exposure is minimal, that it detected and reported suspicious activity, and that it found no evidence of violations in its own review. The company said accounts linked to the reported transactions were removed and that it stopped working with Blessed Trust in January.

Decrypt has reached out to Binance and will update this article should the exchange respond.

Binance is the world’s largest cryptocurrency exchange by trading volume, serving tens of millions of users globally and offering trading in hundreds of digital tokens. The company has sought to position itself as having strengthened its compliance controls in recent years following heightened scrutiny from U.S. regulators.

Binance and compliance

The latest allegations come after Binance pleaded guilty in 2023 to violating U.S. anti-money-laundering laws and sanctions requirements, agreeing to pay $4.3 billion in penalties and to exit the U.S. market. Founder Changpeng “CZ” Zhao was sentenced to four months in prison for his role in the violations. He was given a presidential pardon by Donald Trump in October last year.

That hasn’t stopped U.S. lawmakers taking an interest. In a letter to Teng dated Tuesday, Blumenthal wrote that “Binance appears to have ignored warnings and recommendations to prevent Iranian money laundering schemes on its cryptocurrency exchange,” allowing $1.7 billion in transfers to Iran.

He cited reports that internal compliance staff found that Hexa Whale and Blessed Trust facilitated laundering and trade with Iranian government entities, and that investigators traced cryptocurrency transfers to wallets associated with the Islamic Revolutionary Guards Corps as well as payments tied to Russia’s so-called shadow fleet of oil tankers.

“Binance appears to have ignored clear warning signs, knowingly allowed illicit accounts to operate, and even provided hands-on support to entities engaged in money laundering,” Blumenthal wrote. “…The scale of the newly revealed illicit transfers — uncaught until nearly two billion dollars flowed to sanctioned entities — and the unexplained firing of internal investigators call into question Binance’s compliance with American sanctions and banking laws.”

He also pointed to Binance’s ties to World Liberty Financial, a cryptocurrency venture associated with the family of President Donald Trump, suggesting the company has sought to influence policymakers while facing scrutiny.

The senator requested that Binance provide extensive records by March 6, 2026, including documents related to the activities of Hexa Whale and Blessed Trust, internal reports and communications concerning Iranian and Russian-linked accounts, records tied to the use of Tether and the USD1 stablecoin in potential sanctions evasion, and documentation surrounding the suspension or dismissal of compliance staff involved in the investigations.

Morning Minute is a daily newsletter written by Tyler Warner. The analysis and opinions expressed are his own and do not necessarily reflect those of Decrypt. Subscribe to the Morning Minute on Substack.

GM!

Today’s top news:

• Crypto majors rebound sharply, up 4-8%; BTC at $65.7k
• Meta confirms plans to re-enter stablecoins across Facebook, Whatsapp and IG
• Coinbase launches 24/5 stock trading with no fees & fractional shares
• Tether teased an upcoming product, with speculation of card or neobank
• Virtual rebounds 20% as Base continues to drive the onchain AI meta

💰 Stablecoins Are Eating Everything

Forget crypto winter.

The stablecoin market doesn’t care.

📌 What Happened

On the same day, Stripe announced a $159B valuation driven largely by its stablecoin infrastructure, Meta confirmed it is re-entering the payments space with a stablecoin strategy targeting 3B users.

Meta sent RFPs to crypto infrastructure firms seeking a third-party partner to administer stablecoin-based payments across Facebook, WhatsApp, and Instagram, targeting a launch early in H2 2026.

Stripe, which acquired stablecoin platform Bridge last year and whose CEO Patrick Collison sits on Meta’s board, is the leading candidate. This comes after Stripe processed $1.9 trillion in total payment volume last year, up 34%. Bridge volume quadrupled. Stripe also received a national bank trust charter from the OCC last week, letting it custody crypto and manage stablecoin reserves directly.

Meta is not issuing its own token, wanting a “stablecoin agnostic” integration and a new in-app wallet. Meta spokespeople clarified the project is about enabling payments, calling it “enabling people and businesses to pay using their preferred method.”

🗣️ What They’re Saying

“It may be a crypto winter, but it’s a stablecoin summer.”

“Stablecoin payments are advancing quietly and inexorably as real-world uptake continues apace.” – Patrick and John Collison, Stripe annual letter

“Nothing has changed; there is still no Meta stablecoin. This is about enabling people and businesses to make payments on our platforms using their preferred method.” – Andy Stone, Meta communications director

🧠 Why It Matters

A Meta stablecoin is a big deal.

Facebook has 3.2 billion monthly active users. WhatsApp has 3 billion, with an 84.1% daily open rate (the highest of any major app) and 100 billion messages sent every day. Instagram hits another 3 billion.

Meta’s full family of apps reaches 3.98 billion unique people per month. That’s roughly half the world’s population.

For those who don’t remember, Meta’s prior stablecoin attempt failed because regulators came down hard on a company trying to issue its own global currency. This time, Meta is doing none of that. They’re opting to be stablecoin agnostic, using third-party rails.

They learned the lesson and now the regulatory environment under the GENIUS Act has made it easier to execute.

If Meta gets this working across WhatsApp alone—remittances, creator payouts, cross-border transfers—that’s a stablecoin use case at a scale that could dwarf everything currently on-chain.

Stablecoin supply and volumes would soar.

For traders: the clearest beneficiaries are Circle (USDC issuer, likely integration candidate), Tether (always in the driver’s seat), Stripe itself, and any infrastructure layer that sits between the wallet and settlement. And Meta of course…

🌎 Macro Crypto and Markets

• Crypto majors are very green after a big rebound; BTC +4% at $65.7K; ETH +6% at $1,940; SOL +8% at $83
• Virtual (+20%), Morpho (+16%), DOT (+13%) and ETHFI (+13%) led top movers; AVAX +10% as well
• Bitcoin is down 50% from its all-time high as trader sentiment turns increasingly bearish, per Decrypt reporting today.
• The Ethereum Foundation began staking 70,000 ETH from its treasury, with an initial 2,106 ETH deposit going live today; staking rewards will fund protocol R&D and ecosystem grants
• Vitalik has sold more than 10,700 ETH since early February, netting roughly $6.1M, with the proceeds used to help fund the Ethereum Foundation
• The Trump administration is publicly pressuring the crypto industry to revive the stalled market structure bill
• Meanwhile, World Liberty Financial is siding with Coinbase against the White House’s version of the market structure bill, creating a split between Trump’s administration and Trump’s own crypto business over stablecoin yield language
• Michigan lawmakers introduced a bill that would allow state employees to receive wages in Bitcoin
• Solana DeFi TVL has declined 52% from its September peak to $6.3B
• Tether teased an upcoming product announcement, with speculation of a neobank and/or payments card

Corporate Treasuries & ETFs

Meme Coin Tracker

• Meme majors were very green alongside majors; DOGE +4%, SHIB +2%, PEPE +4%, TRUMP +5%, PENGU +8%, SPX +10%, FARTCOIN +13%
• Punch (+22%) and ARC (+25%) led notable movers; AgenC (+110x) and Claw (+52x) led new movers
• Base AI tokens soared with Virtual (+20%), VVV (+27%), FELIX (+100%) and TIBBIR (+19%)

💰 Token, Airdrop & Protocol Tracker

• Coinbase announced tokenized stock trading, available 24/5, with 0 commission fees and with fractional shares available
• Kraken launched tokenized equity perpetual futures via its xStocks framework, offering up to 20x leverage on assets including the S&P 500, Nasdaq 100, Apple, Nvidia, Tesla, and GLD
• Binance returned to tokenized stocks for the first time since its 2021 regulatory pullback, listing 10 Ondo Finance-issued U.S. stock, ETF, and commodity tokens on Binance Alpha
• Aave DAO published an audit of Aave Labs historical performance ahead of their $51M ask tomorrow
• EtherFi announced its Earn function available on its iOS app

🚚 What is happening in NFTs?

• NFT leaders were slightly red with ETH rebounding; Punks -1% at 29.7 ETH, Pudgy -1% at 4.45 ETH, BAYC even at 6 ETH; Hypurr’s +2% at 467 HYPE
• Doodles (+14%) and Moonbirds (+5%) led top movers
• Ether Rock sells for 69.9 ETH
• XCOPY’s ‘Last Selfie’ gets $1M loan

Stablecoin issuer Circle saw USDC circulation grow 72% year-on-year to $75.3 billion in the fourth quarter. The company also reported that transaction volume reached $11.9 trillion, an increase of 247%.

USDC market capitalization has wavered slightly since the end of last year, dipping as low as $70 billion at the start of February. But it has since rebounded to nearly $75 billion, according to crypto price aggregator CoinGecko.

Circle released its report early Wednesday morning and had its earnings call scheduled for 8 a.m. New York time. In pre-market trading, CRCL shares jumped 14%. After the opening bell, the gains jumped to 20%, with the stock changing hands for $73.24 at the time of writing.

“The print reinforces continued USDC adoption despite a softer crypto backdrop and should support a strong positive stock reaction today,” wrote Clear Street analysts Owen Lau and Nikhil Vijay in a note shared with Decrypt.

CEO Jeremy Allaire opened the company’s earnings call saying he believes Circle will grow in tandem with the artificial intelligence industry, and “drive the greatest acceleration of economic activity we’ve ever seen in human history.”

“Not only will our global economic system become more internet-native, but it will also become dramatically more automated,” he said. “We are entering a world where, in my view, likely tens or hundreds of billions of AI agents will interact and perform economic functions over the internet.”

He added later that the company has been building systems that support agentic payments.

“In fact, we just went into testnet release of a new capability, the Circle Gateway, that allows for agents to autonomously and programmatically automate cross chain USDC transactions with a transaction cost of $0.00001,” Allaire said.

The company saw its revenue and reserve income reach $770 million in Q4, a 77% increase from the previous year.

Circle saw a net loss from continuing operations reach $70 million in 2025, noting that it was significantly impacted by $424 million worth of stock-based compensation tied to vesting conditions of the company’s initial public offering.

Circle made its debut on the New York Stock Exchange last June and was so popular with investors that NYSE halted trading three times within the first hour. But the company saw its momentum slow in 2025 as the Federal Reserve lowered interest rates and investors fretted that it would impact interest earned on the cash reserves that back USDC stablecoins.

WisdomTree said on Tuesday that it’s enabling instant settlement for its tokenized money market fund, indicating its product won’t be limited by Wall Street’s pace any longer.

The shift is expected to reduce “cash drag” associated with settlement delays in traditional markets, while harnessing certain advantages that are innate to digital assets, the institution with $168 billion in assets under management said in a press release.

The arrangement, which also enables round-the-clock trading for the WisdomTree Treasury Money Market Digital Fund (WTGXX), required exemptive relief from the SEC.

On Tuesday, the regulator said it was okay for investors to trade WTGXX’s shares at $1 with a dealer on an intraday basis, regardless of WTGXX’s net asset value. That is typically determined every business day immediately after U.S. markets close.

“The SEC is committed to working with market participants to foster innovation and modernization, especially in enabling the tokenization of our capital markets.” Brian Daly, SEC director of the division of investment management, told Decrypt. “This relief preserves the protections of a regulated money market fund while permitting retail investors intra-day liquidity.”

Although funds registered under the Investment Company Act of 1940 have historically functioned as investment vehicles, the SEC’s relief positions WisdomTree’s product as a form of digital cash that can be spent, moved, or traded instantly at any hour.

WisdomTree described that functionality as “unprecedented,” while unlocking the efficiency and liquidity advantages native to digital representations of real-world assets.

WisdomTree noted that its broker-dealer subsidiary gained FINRA approval to engage in principal trading for WTGXX. The company said that enables round-the-clock liquidity for shares in its tokenized money market fund, which can be exchanged for stablecoins.

At the same time, WisdomTree said its rollout “continues dividend accrual” for WTGXX, which involves using blockchain timestamps to track how long investors hold the token. That allows shareholders to earn yield even as WTGXX moves between wallets, WisdomTree said.

WTGXX was valued at $730 million on Tuesday, according to RWA.xyz. It has been issued across nine networks, such as Ethereum and Solana, while offering an annualized percentage yield of 3.5%. Backed by U.S. Treasuries, its shares aim to trade at a value of $1 like a stablecoin.

The development underscores how the SEC is becoming increasingly comfortable with mainstream financial products augmented by their blockchain-based format. In its relief order, the SEC said its green light was “appropriate in the public interest.”

In July, SEC Chair Paul Atkins said the agency was committed to modernizing securities rules and regulations enabling financial markets to move on-chain through an initiative called “Project Crypto.”

In the press release, WisdomTree Head of Digital Assets Will Peck indicated approvals from the SEC and FINRA are paving the way for that transition.

“This is a true innovation and improvement in the investor experience, and it demonstrates how blockchain can serve as a new set of rails for capital markets,” he said.

Editor’s note: This story was updated after publication with a comment from the SEC.