Today in crypto: Bankman-Fried breaks Twitter silence

South Dakota rejects Bitcoin reserve bill

South Dakota lawmakers have rejected a bill allowing the state to invest in Bitcoin, following a similar decision in Montana last week. On Monday, the House Commerce and Energy Committee voted nine to three to defer House Bill 1202 until the 41st legislative day—effectively killing it since the legislative session runs for only 40 days.

The bill, introduced by Republican State Representative Logan Manhart, would have allowed South Dakota to allocate up to 10% of its public funds to Bitcoin. Manhart called it a “common-sense” update to diversify state investments. However, state investment officer Matt Clark cited Bitcoin’s volatility and lack of income generation as key concerns.

Montana recently rejected a similar bill that would have allowed up to $50 million to be invested in cryptocurrencies, stablecoins, and precious metals. Despite setbacks in North Dakota, Wyoming, and Pennsylvania, Bitcoin adoption efforts continue in Florida, Arizona, Utah, and Texas, with 18 state-level proposals still pending. Manhart vowed to reintroduce the bill next year.

Bankman-Fried returns to social media

Disgraced former FTX CEO Sam Bankman-Fried returned to X after two years of silence, posting about employee terminations and corporate management. Serving a 25-year prison sentence for fraud, he wrote that “firing employees is one of the hardest things to do,” adding that it’s often due to a lack of suitable roles rather than poor performance.

His comments followed Elon Musk’s recent directive to employees at the Department of Government Efficiency (DOGE), requiring them to justify their weekly work via email or face resignation. Bankman-Fried joked that he hadn’t checked his email “in a few hundred days” and expressed sympathy for government workers.

The crypto market reacted quickly. SBF Coin, a memecoin named after Bankman-Fried, rose 8.4% within six hours, while FTX’s native token, FTT, surged 32%. The posts follow Bankman-Fried’s recent interview with The New York Sun, where he voiced support for Musk’s approach to government bureaucracy and hinted at aligning with President Donald Trump. Meanwhile, FTX’s bankruptcy estate has started repaying creditors, with plans to return up to $16 billion to former customers.

Crypto markets plunge amid Bybit hack and trade tensions

Cryptocurrency markets dropped sharply, with Bitcoin hitting a three-week low due to economic pressures, weak tech stocks, and the recent Bybit hack.

Investor confidence fell after President Trump confirmed tariffs on Canadian and Mexican imports, raising inflation concerns. Weakness in AI stocks, including Microsoft and Nvidia, added to the risk-off sentiment, where investors shift to safer assets.

The $1.4 billion Bybit hack worsened the market sell-off. Over $686 million in leveraged crypto positions—investments made with borrowed funds—were liquidated, causing forced selling that intensified the drop. Some analysts view this deleveraging as a healthy reset for the market.

Uncertainty over the Federal Reserve’s monetary policy also weighed on markets. The upcoming regulatory review by the President’s Working Group on Financial Markets may provide clarity, but volatility is expected to continue.

Top crypto gainers and losers

Despite the market downturn, Story gained 24%, trading at $4.94 with $812 million in volume. Dexie rose 1.8% to $19.14.

On the losing side, Telcoin dropped 20.1%, Sui fell 17.8% to $2.71, and Aave declined 17.4% to $195. Lido DAO, linked to Ethereum staking, fell 16.4% to $1.34, while Bitcoin layer-two solution Stacks dropped 16.2% to $0.73. Solana, a recent market favorite, plunged 15.4% to $135, with Binance Staked Solana falling 15.3% to $140.

The Crypto Fear and Greed Index has dropped into “extreme fear” territory, and institutional investors are pulling back. Analysts see potential buying opportunities for long-term investors, but volatility is likely to persist as the market searches for a bottom.