TLDR Newsletter – February 4, 2026

Dive into this week’s crypto and fintech highlights: The SEC updated Marketing Rule FAQs for more flexibility on net performance and promoter rules, dropped the Gemini Earn case after investors were made whole, and co-hosted a CFTC event on crypto harmonization—while enforcement continued with a $250M Railgun DAO suit and $8.5M Tether seizure in pig butchering scams. Polygon Labs acquired Coinme and Sequence for $250M to build its stablecoin payments stack, Steak ‘n Shake added $10M in Bitcoin to its treasury, stablecoin market cap topped $311B, BitGo launched its IPO raising over $200M, and crypto M&A is projected to exceed 2025’s $37B record.

Regulatory Updates

SEC Issues New FAQs Providing Added Flexibility Under the Marketing Rule
On January 15, 2026, the Securities and Exchange Commission staff updated its frequently asked questions (FAQs) on Rule 206(4)-1 under the Investment Advisers Act of 1940, offering important interpretive guidance on the SEC’s modernized Marketing Rule.

Model Fee FAQ
A significant area of guidance concerns how advisers present “net performance” in advertisements. Historically, industry practitioners interpreted the Marketing Rule to require use of a “model fee” rather than actual fees when actual fees historically charged were lower than those to be charged to a prospective investor. The new FAQ clarifies that the rule does not categorically mandate model fees in these situations. Instead, whether using actual fees complies with the Marketing Rule’s general prohibitions depends on all the facts and circumstances of a specific advertisement, including relevant disclosures. This provides advisers with greater flexibility in illustrating performance impacts without automatically defaulting to a model fee calculation.
Promoter Disqualification FAQ
The updated guidance also addresses the disqualification provisions that limit compensation of “bad actors” for testimonials and endorsements. While the Marketing Rule generally bars advisers from compensating persons subject to disqualifying events, the SEC staff clarified that they would not recommend enforcement in certain scenarios involving self-regulatory organization (SRO) final orders that did not result in industry bars or suspensions, provided specific conditions are met. | Read more

CFTC and SEC to Host Joint Event on Crypto Harmonization
The CFTC and SEC announced they will co-host a public event on January 27, 2026, focused on regulatory harmonization and U.S. leadership in the crypto markets. The event will feature remarks from CFTC Chairman Michael S. Selig and SEC Chairman Paul S. Atkins, followed by a fireside chat on aligning regulatory approaches in the digital asset space. | Read more

Litigation Updates

Victims Target Crypto Privacy DAO in $250M Suit to Seize North Korea-Linked Funds
A group of 21 torture and terrorism victims and relatives who hold U.S. money judgments against North Korea sued Railgun DAO in Washington, D.C. federal court, seeking nearly $250 million and alleging the project helped launder North Korean–linked stolen crypto that should have been frozen and available to satisfy their judgments. The complaint claims Railgun’s zero-knowledge privacy protocol was used after major North Korea–attributed hacks in 2022 and 2025, and that Railgun knew or should have known much of its fee revenue came from those laundering flows but processed them anyway. | Read More

DOJ Recovers $8.5M in Tether, Cracking Down on “Pig Butchering” Crypto Scams
Federal investigators in the Eastern District of North Carolina seized nearly $8.5 million in USDT (Tether) after tracing the funds to wallets allegedly tied to “pig butchering” crypto investment scams. Pig butchering scams are schemes where fraudsters cultivate trust (often via romance or business pretexts), steer victims onto fake trading platforms showing fabricated gains, and then freeze withdrawals while demanding additional “taxes” or “penalties.” The release also notes that, since 2024, EDNC and the FBI have seized more than $15 million for victims in similar crypto-fraud matters and urges potential victims to report to IC3 and the FTC, and to avoid anyone online who promises outsized returns or offers paid “recovery” services. | Read More

SEC Dropping Gemini Earn Case After Investors Made Whole, Deal Finalized
The SEC has moved to dismiss its enforcement case against Gemini Trust, formalizing a settlement the parties disclosed in September and ending claims tied to Gemini’s now defunct Earn lending program. The action, filed in January 2023, alleged Gemini and lending partner Genesis offered unregistered securities through Earn. The program was halted after Genesis’ liquidity crisis and January 2023 bankruptcy left users unable to withdraw. In the dismissal filing, the SEC emphasized that Earn customers have since been made whole through the Genesis bankruptcy process and related 2024 settlements with New York regulators and noted Genesis separately settled with the SEC in March 2024 for a $21 million penalty without admitting wrongdoing. | Read More

Coinbase Pushes to Dismiss NJ Investor Suit, Citing New Third Circuit Ruling
Coinbase is trying dismiss a New Jersey investor class action that claims the exchange downplayed two powder-keg issues: (i) SEC enforcement risk; and (ii) what could happen to customer crypto in bankruptcy. Coinbase argued the case still isn’t pleaded with the required defendant-by-defendant specificity and, more importantly, that fresh Third Circuit precedent now guts the plaintiffs’ theories. The company says recent decisions mean it didn’t have to label an SEC probe as an “enforcement investigation” or forecast an imminent lawsuit, and that talking about risks like hacking and private-key loss can’t be spun into misleading silence about a separate bankruptcy scenario. On top of that, Coinbase is pressing an argument that the investors can’t “trace” their shares to registered stock to try to shut down the Securities Act claims at the pleading stage. | Read More

Legislative Updates

Senate Agriculture Committee Advances a GOP-Only Crypto Market Structure Draft
Senate Ag Committee Chair John Boozman released a revised draft of the crypto market structure legislation, which currently lacks Democratic support. This move sets up a potentially partisan committee markup. This draft would expand the Commodity Futures Trading Commission’s authority over digital assets and leaves Securities and Exchange Commission-related provisions to the Senate Banking Committee. As it stands, the proposal includes $150 million in funding for the CFTC and incorporates non-binding language that seems to encourage bipartisan agency appointments, thereby signaling continued tension over regulatory balance and implementation. | Read More

Crypto Market Structure Legislation Delayed as Senate Shifts Focus to Housing
As the Senate Banking Committee pivots toward affordable housing initiatives, the comprehensive crypto market structure legislation is expected to be delayed by at least several weeks. Lawmakers are reportedly prioritizing their efforts to curb institutional investment in single-family housing. This delay follows Coinbase’s withdrawal of support for the Senate Banking Committee’s crypto draft, which created additional uncertainty around any bipartisan consensus. Although the Agriculture committee is moving forward with its own draft, any final legislation will require reconciliation between the two committees. | Read More

PROTECT Act Proposes Full Repeal of Section 230, Raising Platform Liability Concerns
Representative Jimmy Patronis recently introduced the PROTECT Act, which would entirely repeal Section 230 of the Communications Decency Act. This would eliminate broad liability protections for online platforms with respect to user-generated content. Supporters of the legislation contend that such a repeal is necessary to hold technology companies accountable for harm to children. However, critics warn that it could fundamentally alter online speech and modern practices. Legal experts likewise caution that a repeal of Section 230 is likely to incentivize platforms to restrict content or remove opportunities for user-generated commentary. Additionally, they warn that this would likely disproportionately affect smaller websites and forums. Notably, the bill in its current form contains no replacement framework or transition period. | Read More

Market Updates

Crypto M&A Activity Projected to Exceed $37 Billion Record in 2026
Industry reports from early January 2026, including analyses by DL News and Architect Partners, forecast crypto mergers and acquisitions to surpass the $37 billion record set in 2025, driven by regulatory clarity, favorable interest rates, and consolidation in stablecoins and payments. With 2025 seeing $37 billion across 356 deals (up 74% year-over-year), insiders anticipate even stronger momentum in 2026 as institutions deepen blockchain integration. | Read More

Polygon Labs Acquires Coinme and Sequence for $250 Million
On January 15, 2026, Polygon Labs announced it has entered into definitive agreements to acquire crypto ATM operator Coinme and payments startup firm Sequence for a combined $250 million. The acquisitions are intended to bolster Polygon’s upcoming “Open Money Stack,” an effort to create a comprehensive stablecoin and payment solution to compete with traditional fintech giants like Stripe. Polygon Labs CEO, Marc Boiron, stated the acquisitions will give the firm access to regulated US payment rails, wallet infrastructure, and cross-chain capabilities. | Read More

Steak ‘n Shake Adds $10 Million in Bitcoin to Corporate Treasury
There isn’t an error in the headline – apparently the accumulation of corporate Bitcoin treasuries is not limited to crypto-native firms, or financial firms for that matter. On January 17, 2026, fast-food chain Steak ‘n Shake announced it had added $10 million worth of Bitcoin to its balance sheet. The move comes after the company began accepting Bitcoin payments in May, 2025 through the Lightning Network. The company reported nearly 50% savings in transaction fees and attributed increases in same-store sales to the added payment method. Steak ‘n Shake’s decision highlights the potential benefits for businesses and underscores growing acceptance of cryptocurrencies among varied industries. | Read More

Stablecoin Market Cap Hits New All-Time High Above $311 Billion
By January 18, 2026, the total stablecoin supply reached a record $311.332 billion (currently around $309 billion), providing a safe haven amid broader crypto volatility and price declines. Dominated by Tether’s USDT at over $187 billion and Circle’s USDC at $74 billion, this milestone underscores stablecoins’ growing role in trading, remittances, and DeFi despite market headwinds. | Read More

BitGo Holdings Prices U.S. IPO at $18 Per Share, Seeks to Raise $212.8 Million
On January 21, 2026, crypto custody firm BitGo Holdings priced its initial public offering above the expected range at $18 per share, raising approximately $212.8 million and debuting on the NYSE under ticker BTGO with a valuation exceeding $2 billion. This marks the first crypto company IPO of 2026, signaling renewed investor confidence in regulated digital asset infrastructure despite sector challenges. | Read More

Recent Insights

This newsletter is provided for informational purposes only, and should NOT be relied upon as legal, business, investment, or tax advice.