Crypto faces volatility and tighter regulation, while AI expands amid legal scrutiny, ethical concerns, and growing unease over long-term societal impact.
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In Web3, price action remains closely tied to macro signals, with Bitcoin reacting to inflation data even as rate cut expectations fade. At the same time, fragility is surfacing in more speculative corners of the market, from WLFI’s collapse following leveraged collateral exposure to a sharp sell-off in Bittensor’s TAO amid concerns over centralisation.
Regulatory momentum is also accelerating globally. Hong Kong has issued its first stablecoin licences under a formal regime, while Japan is moving to classify crypto as financial products with stricter disclosure and insider trading rules. In Europe, France is pushing for tighter controls on stablecoins and self-hosted wallets, signalling a broader shift towards more intrusive oversight of user activity.
In AI, adoption continues to deepen, but not without growing friction. From legal probes into OpenAI and regulatory battles involving xAI, to ethical concerns around government-linked investments and real-world security incidents, the technology is increasingly entangled with politics, governance, and public trust. Meanwhile, shifting user sentiment, particularly among younger cohorts, suggests that rapid adoption is now being tempered by concerns over long-term cognitive and societal impact.
Get up to speed with the latest in Web3 and AI with this week’s Pasar Pulse.
Crypto and Web3
WLFI Hits Record Low Over Loan Collateral Fears
WLFI, the Trump-backed token, fell to a record low of US$0.077 following revelations that the project used five billion tokens as collateral for a $75m loan. Analysts warn of liquidation risks due to the asset’s inherent lack of liquidity.
Hong Kong Issues First Stablecoin Licences
The HKMA has granted its first stablecoin licences to HSBC and Anchorpoint Financial, an SCB/Animoca venture. This marks the start of a regulated regime requiring reserve backing and anti-money laundering controls for stablecoins in the city.
France Pushes for Stricter Crypto Oversight
A Bank of France official has called for tighter MiCA limits on non-euro stablecoins used for payments. The National Assembly also advanced a bill requiring annual reporting for self-hosted wallets exceeding a $5,000 threshold.
Japan to Classify Crypto as Financial Products
Japan’s cabinet has approved a draft bill to reclassify crypto under the Financial Instruments and Exchange Act. The move introduces insider trading bans, annual disclosure requirements, and tougher penalties for unregistered operations.
TOTM Labs Launches AI Venture Builder
Singapore-based TOTM Labs has launched to integrate AI and blockchain for institutions. Backed by TOTM Technologies, the venture builder provides proprietary AI engines and tokenisation frameworks for the development of the on-chain economy.
TAO Faces Selloff Over Centralisation Claims
Bittensor’s TAO token dropped 30% after subnet operator Covenant AI exited, accusing the project of theatrics. Analysts warn of a 45% decline as fractals and high volumes suggest continued bearish momentum.
US CPI Rise Cools Hopes for April Rate Cuts
March CPI rose 3.3% year-on-year, slightly lower than expected but still above the Fed’s 2% target. Despite the data, traders see a 0% chance of an April rate cut. Bitcoin briefly touched $73,000 following Friday’s announcement.
Bhutan Liquidates 70% of Its Bitcoin Stash
Bhutan has reduced its Bitcoin stash from 13,000 to roughly 3,954 BTC over 18 months, moving $215m this year alone. Evidence suggests the kingdom has also halted hydropower mining as network difficulty rises and rewards diminish.
Artificial Intelligence (AI)
Viral Lego AI Videos Mock US Military Success
Iranian group Explosive Media is seeing viral success with AI-generated Lego videos. The clips mock the US rescue of a downed pilot as a financial waste, portraying jets exploding into cash. Despite the propaganda, the videos are trending.
Microsoft Scrubs Copilot Buttons From Apps
Windows 11 is undergoing a decluttering with Microsoft removing dedicated Copilot buttons from Notepad, Photos, and the Snipping Tool. Whilst branding is disappearing to keep apps lightweight, the underlying AI features remain for now.
Florida AG Launches OpenAI Investigation
Florida Attorney General James Uthmeier is investigating OpenAI over claims that the technology is reaching entities like the CCP. The probe also links ChatGPT to criminal behaviour and a 2025 shooting following a victim’s family’s lawsuit.
Meta Muse Spark Debuts to Chase AI Rivals
Meta has launched Muse Spark, the first model from its high-cost superintelligence team. Whilst it rivals Google and OpenAI in language tasks, it struggles with coding. Meta plans to integrate it across Instagram and WhatsApp.
Pentagon Official Reaps $24m From xAI Sale
Emil Michael, the Pentagon’s AI lead, reportedly made up to $24 million selling xAI stock. Ethics experts are raising red flags as he held the stake whilst the Department of War entered agreements with Musk’s firm, suggesting a conflict.
Incendiary Device Thrown at Sam Altman’s Home
A 20-year-old suspect has been arrested after throwing a Molotov cocktail at OpenAI CEO Sam Altman’s house. The suspect also allegedly threatened to burn down OpenAI’s headquarters. No injuries were reported; the case remains active.
Gen Z Uses AI Daily But Fears Cognitive Decay
A new Gallup survey reveals 51% of Gen Z uses AI weekly, yet excitement has plummeted. Many believe the tech leads to dependency, memory loss, and decreased creativity despite higher usage frequency.
Musk’s xAI Sues Colorado Over AI Risk Laws
xAI is suing to block Colorado’s SB24-205, arguing the law forces “state-enforced orthodoxy” on models. Musk’s team claims the risk-disclosure requirements violate the First Amendment by compelling speech on topics like diversity.
That’s all for this week’s Pasar Pulse. Want more insights? Stay tuned to our site or subscribe via email!
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