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The Crypto Council for Innovation (CCI) and Blockchain Association (BA) are seeking to block Illinois from enforcing a 0.2% tax on cryptocurrency transactions before it takes effect in January 2027.The trade groups said Wednesday that they have filed a motion for a preliminary injunction in the Circuit Court of Sangamon County, Illinois to protect digital asset firms from suffering irreparable harm.“Companies are being asked to spend millions to build systems for a tax that violates their constitutional rights without answers to basic questions about what is taxed and when, all under the threat of criminal penalties,” said Ji Hun Kim, CCI CEO, in a statement. “These costs are being borne right now, against a Jan. 1 deadline, forcing companies to divert key resources and employees to a clearly unlawful tax.”The two groups last month filed a lawsuit challenging Illinois’ digital asset tax on the grounds it violated the US Constitution, the state’s constitution, federal and state due process laws and the federal Internet Tax Freedom Act. Illinois Governor JB Pritzker signed the measure into law as a “privilege tax” in June as part of the state’s fiscal year 2027 budget, requiring crypto users to be taxed as applied to transaction volume rather than income. Another trade group, the Digital Chamber, filed a similar suit days earlier.The Midwestern state was the first in the nation to single out crypto transactions.“The state loses very little by waiting. Everyone else loses a great deal by forging ahead. And if this Act stands, Illinois will not be the last state to try it,” said Summer Mersinger, CEO of the Blockchain Association.Separately, Illinois is also targeting prediction markets. Kalshi’s has filed a lawsuit against Illinois officials over a law that went into effect on July 1 that “expressly bans sports event contracts,” which the company said is in violation of federal law by requiring state licensing.Separately, Pritzker signed an executive order banning state employees from betting on the platforms in April in an effort to ”prevent insider trading amid the rapid growth of online prediction markets and event-based gambling contracts.”Magazine: Crypto industry ties were a liability in Illinois primaryCointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.

Strategy’s Michael Saylor said “We’re Back” in his latest signal on X (formerly Twitter) of the company’s likely return to Bitcoin buying.For market watchers, the post could be a strong psychological signal as Saylor has a track record of dropping cryptic weekend teasers that precede official Monday morning treasury purchase announcements. Should that record, and community interpretation, hold true, his post points to the resumption of corporate Bitcoin accumulation following a notable summer hiatus.To put the message in context, over the past two months, Strategy paused its regular weekly Bitcoin buying spree. Instead of expanding its crypto holdings, management pivoted toward bolstering its balance sheet. The firm focused on stabilizing its preferred stock offerings, building a $5.1 billion US dollar reserve, and introducing a dedicated $1.59 billion cash pool generated through massive common stock offerings.Related: Strategy’s $66B Bitcoin machine hinges on capital markets, not BTC price: ReportThis strategic breather coincided with a challenging market stretch that left Strategy’s industry-biggest BTC treasury sitting deep in the red on paper. However, recent macro momentum has propelled Bitcoin past the $80,000 threshold.Because Strategy holds more than 840,447 Bitcoin at an average cost basis hovering around $75,385, the recent price recovery has pushed the firm’s overall position back into positive territory for the first time in months.Saylor’s “We’re Back” declaration functions on multiple levels. Operationally, it likely signals that the company is ready to deploy its considerable dry powder back into the asset class it champions. Psychologically, it marks a triumphant return to profitability and a renewed offensive for the world’s largest corporate Bitcoin treasury.Magazine: 200,000 fake AI ‘victims’ deployed to scam bait online fraudstersCointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.

A new Federal Reserve Bank of Cleveland working paper offers a provocative explanation for why cryptocurrency behaves so differently from traditional financial assets: Americans who buy crypto don’t simply have different demographics or risk appetites, they have radically different beliefs about digital assets’ future returns.The finding could help explain both crypto’s persistent volatility and the way rallies can attract new buyers, potentially creating a feedback loop in which rising prices reinforce bullish expectations and pull more investors into the market.Using repeated surveys of as many as 25,000 US households per wave, researchers Michael Weber, Bernardo Candia, Olivier Coibion and Yuriy Gorodnichenko found that expectations about crypto returns explain more of the variation in who owns cryptocurrency than a broad range of demographic characteristics. The paper, titled “Do You Even Crypto, Bro? Cryptocurrencies in Household Finance,” also uses a randomized information experiment to show that simply giving people information about Bitcoin’s (BTC) recent performance can increase both their desired crypto allocation and their subsequent purchases. Perceived risk of crypto by ownership. Source: Federal Reserve Bank of ClevelandThe researchers say the results point to a potential mechanism behind speculative bubbles: past gains can attract new investors, whose purchases push prices higher and potentially attract still more buyers. “Positive returns attract new participants, which raises the price further,” the authors writeThat dynamic is particularly striking because cryptocurrency remains poorly understood by a large share of the population. In the researchers’ 2021 survey, 87% of people who did not own crypto said they didn’t know what return to expect from it over the following year. Among crypto owners, the figure was still 54%. Related: Canadian crypto ownership increases to 25%: Ontario surveyOwnership linked to double-digit returns expectationsFor those willing to make a forecast, however, the gap was enormous. Crypto owners expected an average 22% return over the following year, compared with just 7% among non-owners. Owners also tended to view crypto as less risky than non-owners did. The researchers found that expected returns were unusually powerful in determining ownership. A one-percentage-point increase in an individual’s expected crypto return was associated with a 0.8-percentage-point increase in the probability of owning cryptocurrency. Expectations about returns and risk together explained considerably more variation in crypto ownership than observable characteristics such as age, income and gender. That makes crypto an outlier compared with stocks, bonds and gold. For traditional assets, demographic and financial characteristics generally have much more explanatory power than differences in expected returns. Crypto reverses that relationship. Source: Federal Reserve Bank of ClevelandThe demographic profile of crypto investors nevertheless remains distinctive. People under 40 were 13 percentage points more likely to own cryptocurrency than those over 60, even after controlling for other characteristics. Men were about 4 percentage points more likely than women to own crypto, while higher-income and wealthier households were also more likely to participate. The experiment provides perhaps the paper’s most consequential finding for crypto markets.In 2025, researchers randomly assigned households to receive information about BTC, stocks, GameStop or inflation. Participants who were shown Bitcoin’s previous 12-month return increased their desired crypto portfolio allocation by roughly 2 percentage points, or about a 47% increase relative to the 4.3% desired allocation among the control group. Actual subsequent crypto purchases also rose by about 2.5 percentage points. The authors describe the result as “providing information about recent Bitcoin returns induces some households to start buying cryptocurrency.” The effect was concentrated among people who said they didn’t own crypto because they lacked sufficient information. Those who already believed crypto was a bad investment generally did not respond to the information treatment. The paper also finds that crypto wealth can spill into household consumption. A doubling in BTC’s price made a household whose entire financial portfolio was in crypto 1.4 percentage points more likely to buy a durable good, equivalent to roughly a 7% increase relative to the unconditional probability of such a purchase. But the effect did not persist into ordinary spending. That led the researchers to a stark comparison: crypto gains appear to be treated more like “gambling income” or lottery winnings than a permanent increase in wealth.The broader implication is that crypto’s volatility may be rooted partly in disagreement and learning rather than simply market fundamentals. The authors conclude that cryptocurrency stands out because it is poorly understood, investors form sharply different views about its prospects, and new information about past returns can change both expectations and behavior.“The absence of common information and beliefs about crypto across investors,” they write, “suggests that price volatility will continue to be one of the most defining characteristics of this new asset for the foreseeable future.” For crypto markets, that suggests a potentially uncomfortable conclusion: the next wave of retail demand may depend not only on Bitcoin’s price, but on what investors are told about the price that came before it.Magazine: The 100x obsession: Fundamentals grow in importance as crypto matures

Bitcoin miners with operations in Texas are not expected to be impacted by a moratorium on approval of data center projects connected to the state’s grid operator ordered by Governor Greg Abbott, Bernstein analysts said Tuesday.Abbott on Monday directed the Public Utility Commission of Texas and the Electric Reliability Council of Texas (ERCOT) to audit all data centers seeking to connect to the state’s power grid. The duration of the audit was not specified and comes amid increasing public backlash to the pace of data center build-out across the state, The Texas Tribune reported.Bernstein analysts told clients on Tuesday that as most of the Bitcoin (BTC) miners operating in Texas are under contract for approved electric capacity, those operations are unlikely to be impacted by the moratorium.“However, we believe, this audit throttles speculative data center pipeline and makes genuine sites with development history more valuable,” the research team led by Gautam Chhugani said in its note. “Bitcoin mining sites are favorably placed with the longest gestation, self-funding infra and local community management,” they said.They said that the local operations of Cipher Digital (CIFR), Core Scientific (CORZ) and CleanSpark (CLSK) could be the miners most exposed to future public opposition to data center expansion, particularly during ERCOT’s approval process to convert their pipeline assets into grid-connected power capacity.“We believe with increasing political opposition to new data center projects and fresh capacity being throttled by moratoriums/state directives, the approved MWs become more valuable,” they said, highlighting the Texas mining operations of IREN (IREN), which is fully ERCOT grid approved, as are the operations of Riot Platforms (RIOT).CIFR shares were down more than 7% in Tuesday’s premarket trading, according to Yahoo Finance data. The miner reported second-quarter results earlier Tuesday, posting a loss of $0.65 per diluted share, widening from last year’s loss of $0.12 per diluted share. Related: Bitcoin may find bear market bottom in August: 10x ResearchCointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.