← Coin Stories with Natalie Brunell
Coin Stories with Natalie Brunell
News Block: Oil Shocks From Iran War, Stolen Bitcoin, and Kraken's Historic Win
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Welcome to the Coinstories news block, powered exclusively by LEDN. I'm Natalie Brunel, and in about 10 minutes or less, I'll provide you with insightful updates on Bitcoin, financial markets and the global economy. Everything you need to know in one block. Let's go. The conflict in the Middle east has escalated dramatically, and the economic ripple effects are starting to cost all of us. Oil prices have spiked as critical energy infrastructure across the Gulf has been damaged, and companies throughout the region are now invoking force majeure, meaning they literally cannot fulfill their contracts. Here's the thing. This should surprise no one, because we know that wars are inflationary and any tensions flaring in this region can hit oil prices directly. But what is worrisome is how fast this is accelerating. The global economy could be in for a real oil shock, similar to what happened in the 1970s during the Arab oil embargo, when OPEC cut off exports and oil prices nearly quadrupled in a matter of months, sending CPI inflation to 11%. But wartime inflation doesn't come only from broken supply chains and higher commodity prices. It also comes from governments ramping up spending to pay for the war effort. And we're already getting a sense of what's potentially to come if this conflict continues longer than expected. President Trump recently proposed increasing the defense budget by nearly 50%, roughly $500 billion more, to a staggering $1.5 trillion next year. According to the Committee for a Responsible Federal Budget. A military budget that size would add nearly 6 trillion to the national debt over the next decade. So our already massive deficits are about to get even bigger because of the outbreak of war. More spending, more debt, and inevitably more money printing down the road. Speaking of Trump, he made some serious waves when he went after the banking industry directly on Truth Social. He said banks are working to undermine the Genius act because stablecoins can offer customers better yield than traditional bank accounts, something the banks clearly do not want to compete with. And he said that is unacceptable. Trump called out banks for hitting record profits while Americans earn nothing on their money. And he demanded the US Pass the Clarity act, warning that without it, this powerful industry will end up going to China. He may not be wrong, because sovereign adoption appears to be heating up. This past week, Kazakhstan's central bank announced it will invest up to $350 million in digital assets, including Bitcoin. Reuters reports this will come from their gold and foreign exchange reserves fund, not their sovereign wealth fund. With investments beginning as early as April, Kazakhstan's total central bank reserves sit at about $69 billion. The implications here are big. Just think about what this could mean for other countries sitting on enormous foreign exchange reserves. For example, Japan alone holds around 1.2 trillion in reserves. If more central banks began treating Bitcoin as a legitimate reserve asset alongside, that would mark a fundamental shift in the global monetary order and potentially open the door to billions of dollars of new demand. So I hope the US can get its act together and soon if it wants to remain a leader in digital assets, because other countries are clearly waking up to the opportunity. And there are some clear signs the White House understands what is at stake. This past week it released a new national cybersecurity strategy that explicitly positions, quote, cryptocurrency and blockchain as strategic technologies. The US Must secur lead globally. Digital assets are now in the same category as AI and quantum computing, considered critical infrastructure for the future economy and security of the United States. Major Jason Lowry, special assistant to the commander of the US Indo Pacific Command and author of Software, welcomed the report writing quote, boom. Supporting cryptocurrency and blockchain technology is now officially an emerging technology priority in the US Presidential cyber strategy. Although Trump wants to see faster progress, the direction of travel here is unmistakable. Bitcoin is no longer sitting on the edge of the conversation in Washington. It's increasingly becoming part of how the US Government thinks about economic power, national security and technological leadership. Need cash, but don't want to sell your Bitcoin? LEDN is the global leader in Bitcoin backed loans, issuing over $9 billion in loans since 2018 and they were the first to offer proof of reserves. One with LEDEN, you get custody loans, no credit checks, no monthly payments and more. Visit Leden IO Natalie to learn more and get a quarter percentage point off your first loan. Turning now to the White House taking a closer look at how it's securing its own strategic bitcoin reserve because this next story is truly wild. This past week FBI Director Cash Patel announced that John de Gida, the 21 year old son of a government contractor, was arrested in Saint Martin by French authorities in a joint operation with the FBI. The charge allegedly stealing around $46 million in crypto, mostly Bitcoin, from the US Marshals Service. You heard that right. Nearly $50 million worth of Bitcoin that should be locked away and secured in the US Strategic bitcoin reserve was somehow stolen by the kid of a contractor. He was found in a hotel room with a metal briefcase full of cash and hardware wallets. So how in the world. Does something like this happen? Well, apparently his father is the president of a Virginia based IT firm called cmdss which won a contract with the Marshall Service to help manage and dispose of seized crypto tied to the 2016 Bitfinex hack. And yet somehow his 21 year old son gained access to those wallets and allegedly siphoned off tens of millions of dollars. And here's what makes it even more embarrassing. The federal authorities didn't even crack this case in independent On Chain Invest investigator did. Zach xbt, who you may know as the pseudonymous well respected on chain detective, posted a viral investigation about a month ago that tracked the stolen funds directly to Dagita. He traced wallet movements, connected the dots back to CMDSS and published the whole thing publicly. The on chain evidence was irrefutable. After news of the arrest, Zach XBT put it simply writing quote, john Deguita was arrested in the Caribbean yesterday as a direct result of my investigation. Thanks for the last laugh, John. Without the work of Zach xbt, this crime may have gone completely unnoticed by the US Marshals. Let that sink in. The government's own Bitcoin was stolen and a pseudonymous investigator on the Internet caught it before they did. So here are the questions that need to be answered. How was this contract awarded? And why? How is the Bitcoin being stored and managed? And how did the contractor son gain access to government wallets? Most importantly, where is the audit of the US Government's Bitcoin holdings that was promised in the Strategic Bitcoin executive order? That deadline came and went and here we are a full year later, still waiting. Pierre Richard didn't hold back, calling this quote a national humiliation. Like losing the nuclear codes. He wrote, I can't believe the US Strategic Bitcoin reserve was stolen from. And the crypto industry lobby is busy debating stablecoin yield. We should be focused on self sovereign, maximum security, multisig for the SBR with the Department of Defense and dhs. I mean, Pierre has a point. This is a strategically important digital commodity that belongs to the American people. If the US government is serious about Bitcoin as a reserve asset, then it needs to be serious about securing it with world class custody, rigorous audits and real accountability. Because right now there are far more questions than answers. All right, let's end on a high note because this last story is really a watershed moment for the digital asset industry. Kraken has become the first crypto firm in the US to be granted a Federal Reserve Master account. What does that mean? Well, Kraken now has direct access to Fedwire. The same payment rails used by thousands of banks and credit unions to move money across the American financial system. No intermediary banks needed. A crypto native company is now plugged directly into the financial plumbing of the United States. So why is this such a big deal? Up until now, every crypto company in America has had to rely on traditional banks to move dollars on their behalf. Banks that could slow them down, charge them fees, or cut them out entirely. We saw this during Operation choke point 2.0, when regulators pressured banks to debank crypto companies altogether. A Fed Master account changes all of that. Kraken can now settle payments directly through the Fed faster, cheaper, and without asking any bank for permission. And it doesn't just matter. For Kraken, this is a proof of concept for the entire industry. It means the door is now wide open for other crypto firms to follow. The financial system just got more open, more competitive, and a lot harder for incumbents to gatekeep. And predictably, the banks are not happy. The Bank Policy Institute said they are deeply concerned. The American Bankers association said the decision creates serious risk for consumers and the financial system, with one executive saying, quote, this action puts the cart so far ahead that the horse will never be able to catch up. They sound scared because technological disruption is at their doorstep. My thoughts go to the tireless work of people like Caitlin Long, who founded Custodia bank in Wyoming and spent years fighting to get a Fed Master account. Custodia was denied, unfortunately, and I would argue unfairly, but they blazed the trail. And now Kraken is walking through the door that they helped open. Five years ago, the Fed wouldn't return a crypto company's calls. This week, they handed one a pair of keys. That's how fast the world is moving. And lastly, a bit of fun news. Over the weekend, the 20 millionth Bitcoin was mined. That means that less than 5% of Bitcoin's total supply is left to be mined. And it will take another 114 years to mine it all. Milestones like this really put bitcoin's absolute scarcity into perspective. So you might want to pick some up just in case. Until next week, keep stacking. That's it for the news block. Your weekly Bitcoin and economic news update. Powered exclusively by ledn. I'm Natalie Brunel. Make sure you're subscribed to Coin Story so you never miss an episode. This show is for educational purposes and should not be construed as investment advice. Until next time. Keep stacking.