--- title: "WuBlockchain Weekly: Democratic Win Triggers Market Selloff, Vitalik Flags Crypto Survival Priority, Binance Exposes $6.34B Hack Plot, etc" url: https://thecoingazette.com/wublockchain-weekly-democratic-win-triggers-market-selloff-vitalik-flags-crypto-survival-priority-binance-exposes-6-34b-hack-plot-etc/ date: 2026-11-06 modified: 2026-11-06 lang: en author: "Coin Gazette Editorial" description: "The Democratic Party gained control of both chambers of Congress in the U.S. midterm elections. Markets are worried that it will tighten regulation on the AI industry." categories: - "Crypto News" tags: - "crypto" - "cryptocurrencies" - "Defi" - "Market Trends" - "News" image: https://i2.wp.com/cdn-images-1.medium.com/max/1000/1*EPVYMK0EdzHZCt4WlyI4yA.jpeg?w=1400&fit=1400,960&ssl=1 word_count: 1788 --- # WuBlockchain Weekly: Democratic Win Triggers Market Selloff, Vitalik Flags Crypto Survival Priority, Binance Exposes $6.34B Hack Plot, etc 1. Democrats Win Both Congressional Chambers; Stricter AI Regulation Fears Trigger Stock and Crypto Selloff linkThe Democratic Party gained control of both chambers of Congress in the U.S. midterm elections. Markets are worried that it will tighten regulation on the AI industry. Meanwhile, the Democratic Party plans to investigate the Trump family’s business transactions involving cryptocurrency and other sectors. Affected by policy uncertainty, U.S. stocks and the crypto market slumped sharply. The Nasdaq Composite fell 4.98% intraday, the S&P 500 dropped 3.25%, and the Dow Jones Industrial Average declined 2.13%. According to OKX market data, BTC dipped to a low of $75,558, with a 24-hour drop of 5.32%; ETH hit a minimum of $2,236, down 7.23% over 24 hours. CoinGlass data shows that the market saw $870 million in liquidations within four hours, including $812 million in long liquidations and $58.34 million in short liquidations.2. House Democrats to Push New Crypto Market Structure Bill Expanding SEC Oversight Next Congress linkCiting three industry sources, crypto journalist Eleanor Terrett reports that House Democrats are discussing expanding amendments to the Crypto Investor and Consumer Rights Act introduced by Maxine Waters in 2025 into a more comprehensive crypto market structure bill in the next Congress. The new proposal would incorporate previously unadopted provisions from Waters’ version of the CLARITY Act, as well as provisions that Senate Democrats reached consensus on with Republicans ahead of the September procedural vote. Discussions include broadening the SEC’s regulatory authority over crypto markets, limiting the CFTC’s regulatory role, and potentially adding ethics provisions restricting Trump and other federal officials from engaging in crypto-related activities. Republicans characterize it as a bill largely intended for political messaging.3. Binance Discloses Initial Findings on $6.34B Hack: Malware Deployed via Fake Job Interviews; Internal AI Tools Compromised linkBinance released the preliminary investigation report on the hacking incident on October 29, disclosing that attackers infiltrated wallet infrastructure step by step through fake job interviews, malware and internal AI tools. In September this year, an engineer downloaded a project containing malicious code during a fake job interview, resulting in the compromise of his work laptop. On October 20, attackers leveraged the compromised device and internal AI tools to gain system access to other wallet engineers. On October 29, attackers deployed malicious containers using stolen credentials to gain unauthorized access to internal wallet signing services, and delegated partial execution permissions to attacker-controlled smart contracts via the Ethereum EIP-7702 authorization mechanism. Binance stated that suspending withdrawals could not immediately stop the established on-chain malicious authorizations, and the team later revoked the relevant permissions through a dedicated procedure. The incident involved approximately 6.34 billion US dollars in digital assets, of which around 2.85 billion US dollars have been frozen or intercepted. Binance’s latest report said that as of October 31, 98% of the affected token assets had been replenished, and funds exceeding the total losses had been set aside. The investigation is ongoing, and relevant technical findings are subject to independent review.Binance Co-CEO He Yi posted that since 2026, the Binance security team has identified and blocked 57 suspected North Korea-linked cyber threat incidents. Attack vectors include fake job interviews, malware disguised as development tools, tampered software packages and browser extensions, and fake video conferencing applications. He Yi stated that although the team blocked a large number of attacks, it failed to prevent one major security incident, which still led to severe consequences.4. Binance’s $6.34B Breach Prompts Fed and OCC to Rush Traditional Bank System Risk Reviews linkAccording to Reuters, following the $6.3 billion hacking incident on Binance, US regulators have urgently contacted multiple commercial banks to check for potential vulnerabilities in their systems and prevent cyber security risks in the crypto market from spilling over into the traditional financial system. Sources familiar with the matter said regulators from the Federal Reserve and the Office of the Comptroller of the Currency have since Monday morning been asking major banks intensively whether there have been abnormal activities or business disruptions. Meanwhile, Wall Street banks are conducting comprehensive diagnostics of their systems to guard against similar attack tactics. The cybersecurity team at one large US bank contacted Binance’s team within hours after the attack and is now drafting an internal assessment report to advance system self-inspection and security upgrades. Industry insiders noted that targeted infiltration by hackers using rapidly evolving AI models has become a major defensive challenge for the banking sector, and major banks are allocating substantial resources to review and patch code vulnerabilities.5. Hong Kong Legislative Council Passes Crypto Asset Reporting Bill; Automatic Tax Information Exchange Starts in 2028 linkAccording to Hong Kong Legislative Council member Yan Gang, on November 4, the Legislative Council passed the Inland Revenue (Amendment) (Crypto-Asset Reporting Framework and Amended Common Reporting Standard) Bill 2026 to implement the Crypto-Asset Reporting Framework (CARF) set by the Organisation for Economic Co-operation and Development (OECD). Under the arrangement, eligible crypto-asset service providers will be required to perform customer due diligence and report transaction information starting from 2027. Hong Kong plans to automatically exchange tax information on crypto-asset transactions with partner tax jurisdictions from 2028. The reporting covers users’ tax residency status, purchases, sales and transfers of crypto-assets and other related information.6. SEC Updates Crypto FAQ on Governance Control and Securities Law for Token Buybacks linkThe Division of Corporation Finance of the U.S. Securities and Exchange Commission (SEC) updated its FAQ on federal securities law for crypto assets on November 2. It states that participants in a broad governance mechanism are generally not regarded as a single group if they are not affiliated and have no concerted arrangements beyond governance participation. Even if a group is formed, it will qualify as a “central controlling party” only if it holds operational, economic or voting control over the system. The FAQ clarifies that “functional” and “decentralized” are distinct concepts. Services such as maintaining, upgrading and fostering network effects after a system becomes functional do not constitute “essential managerial efforts” under the Howey Test. If a system is functional and lacks a central controlling party, an issuer’s announcement of a buyback plan for non-security crypto assets does not amount to a commitment to undertake such managerial efforts. If the system is not yet functional and the issuer claims the buyback will generate returns for token holders, this may constitute such a commitment. This FAQ represents only staff views and is not legally binding.7. Vitalik: Crypto Industry’s Top Priority Over Next Two Years Is Survival, Not Outcompeting Rivals linkEthereum co-founder Vitalik Buterin said in an interview that with major exchanges such as Binance suffering successive hacks, the top priority for the crypto industry over the next two years is not winning competition but ensuring survival. He believes that major security incidents over the past 18 months have been more concentrated on user interfaces and centralized components, while smart-contract exploits have declined significantly. Major exchanges, custodians and financial institutions need to adopt stricter security defenses and enter a state akin to “fortress mode”. Vitalik warned that if hacking attacks continue, regulators may impose stricter security liabilities on firms. He also stated that Ethereum will leverage zero-knowledge proofs, AI and formal verification to advance the Lean Ethereum roadmap, and L2s should focus on exploring high-performance DeFi, privacy and enterprise applications instead of merely replicating Ethereum’s scaling functions.8. Circle Releases Q3 2026 Earnings: Revenue Up 17% to $865M; USDC Circulation Averages $73.3B linkCircle officially disclosed that its revenue and reserve income for the third quarter of 2026 rose 17% year-on-year to $865 million, and net income from continuing operations increased 5% year-on-year to $226 million. Other income included $182 million in proceeds from the ARC token pre-sale. During the same period, the average circulation of USDC stood at $73.3 billion, representing an 8% year-on-year increase. Circle also stated that it has completed the genesis minting of a total supply of 10 billion ARC tokens and signed a definitive agreement to acquire cross-border payments platform Tazapay. The transaction is expected to close in 2027 and remains subject to regulatory approvals. The company carried out approximately a 5% workforce reduction in the third quarter to align its organizational structure with its operating model and strategic priorities. This adjustment resulted in around $9.145 million in restructuring charges, mainly covering severance pay, notice-period compensation and employee benefits.9. Tether CEO Reveals 150,000 BTC Holdings with Over 730 Million Global Users linkTether CEO Paolo Ardoino revealed in a speech at the Plan ₿ Forum in Lugano that Tether holds roughly 150,000 Bitcoin, serves more than 730 million global users, and adds about 30 million new wallets each quarter. According to Tether’s Q3 reserve attestation report, it directly holds approximately 122.8 billion US dollars in US Treasury securities, which rises to 132.4 billion US dollars when including repurchase agreements, with excess reserves of 7.95 billion US dollars. In addition, Ardoino outlined Tether’s Independence Stack strategy, which plans to build an infrastructure ecosystem covering energy, Bitcoin mining, peer-to-peer communications, self-custody wallets and local AI through open-source technology. He stated that even if Tether ceases to exist in the future, its open-source technology should be able to keep operating.10. ICE Reposts Trade.xyz Partnership, Stressing Launch Pending Regulatory Approval linkAfter deleting its earlier post, Intercontinental Exchange (ICE) republished the partnership announcement with Trade xyz. The revised tweet adjusted the wording, highlighting that the two parties plan to introduce Hyperliquid-based perpetual futures into the U.S. regulated market and explicitly noted that the business is still pending regulatory approval. The platform will operate independently of ICE’s existing institutional futures business and is designed for retail trading experience. It aims to provide 24/7 trading of macro assets including crypto, stocks, indices, commodities and foreign exchange through regulated Futures Commission Merchants (FCMs), including the joint venture between ICE and OKX. The two sides stated they will formally proceed to apply for licenses from regulators to build a compliant market supporting leveraged trading and complying with KYC requirements on the Hyperliquid underlying infrastructure.FundraisingDigital asset insurer Soter Insure secures strategic investment from SC Ventures and SBI Group linkSBI Holdings announces a $100 million investment in US digital bank Erebor Bank linkOn-chain stock trading platform StableStock completes a new strategic financing round at a valuation of $75 million linkOn-chain die-cast automotive collectibles platform Rip Cars raises $1.5 million in strategic financing linkSettle enters into a forward loan agreement of up to $100 million with 3Jane, whereby the latter will raise funds with stablecoin liquidity linkUranium Digital closes $16.5 million Series A financing led by Blockchain Capital linkLombard raises $4 million to drive institutional adoption of the DvL standard linkLatin American stablecoin finance platform Takenos completes a $7 million seed extension round and plans to expand to more than 15 countries across Latin America linkLearn more, check out crypto-fundraising.info.Follow usTwitter: https://twitter.com/WuBlockchainTelegram: https://t.me/wublockchainenglish