The cryptocurrency sector experienced a significant month in February, marked by substantial regulatory adjustments on the horizon and an uptick in Bitcoin adoption worldwide.
A recent report published this month indicates that the Bitcoin network is decentralizing rapidly. Corporate entities now represent 35% of the global hashrate, while China’s share of hashrate has diminished to 14%.
In the United States, the cryptocurrency sector is witnessing notable advancements on the legal front as the Securities and Exchange Commission (SEC) has dropped or suspended five prominent legal actions against crypto-related organizations.
However, not everything is proceeding smoothly. This month witnessed the largest exchange hack in history, with the North Korean hacker collective Lazarus believed to have pilfered $1.4 billion in Ether. Additionally, the market for memecoins appears to be softening, with new issuances plummeting to their lowest levels since before the new year—approximately 40,000 per day.
Here’s February, illustrated by the figures.
SEC drops 6 cases against prominent crypto firms
The SEC halted or paused six legal actions against various exchanges and protocols this month, including those involving Coinbase, Uniswap, and Robinhood Crypto.
These actions represent a new strategy the commission is adopting following the establishment of its Crypto Task Force, led by crypto-supportive Commissioner Hester Peirce. The group has already convened with industry stakeholders to discuss refining regulations related to staking, exchange-traded products (ETPs), and a framework for digital assets.
The SEC and its prospective new chair, Paul Atkins, have instilled hope in Ripple’s chief legal officer Stuart Alderoty that the highly-publicized case against the firm might be dismissed.
Bitcoin decentralizes: 70% of Bitcoin possessed by individuals
At the commencement of this month, investment firm River published an annual analysis highlighting the state of Bitcoin adoption. It revealed that the network is not just expanding quickly but has also become increasingly decentralized.
The US and China’s share of the worldwide hashrate have decreased. While the two nations remain at the forefront of hashrate, a country-specific analysis from Hash Rate Index — referenced by River — indicates that hashrate is diversifying.
The mining power of these two countries has diminished relative to other nations, with 28 countries holding more than 0.1% of the global hashrate and only nine countries holding more than 1%.
Additionally noteworthy: mining pools are distributed more evenly. Although the top 10 mining pools continue to represent the majority of the hashrate, their overall share has decreased in 2024.
Governments, financial institutions, and even software companies are demonstrating increased interest in Bitcoin; habitual substantial Bitcoin purchasers like Michael Saylor’s Strategy and El Salvador continue their acquisitions steadily.
Nevertheless, the preponderance of Bitcoin — nearly 70% — is held by individuals.
US legislators are enthusiastic about Bitcoin reserves, yet five states oppose
It has yet to be 40 days since US President Donald Trump took office and commenced — alongside his allies in Congress — to deregulate the cryptocurrency sector. In fact, 15 new crypto-friendly legislators have entered Congress following the federal elections in 2024.
Trump initiated an “internal working group to position America as the global hub for crypto” via an executive order on Jan. 23. The group is charged with investigating, among other things, the practicality of a national cryptocurrency reserve.
Related: Timeline: Trump’s initial 30 days usher in considerable changes for crypto
Nonetheless, other states press on undeterred. In February alone, 11 states introduced new legislation relevant to Bitcoin reserves or cryptocurrency investments by state authorities.
Lazarus seizes $1.4 billion in largest crypto theft in history
On Feb. 21, the North Korean hacking group Lazarus made off with $1.4 billion in Ether (ETH) from the crypto exchange Bybit, establishing a record for the most significant crypto hack to date. The sum pilfered surpassed the total of all crypto hacks in 2024, which amounted to $1.27 billion, as reported by DefiLlama.
Blockchain expert ZachXBT managed to validate that Lazarus was accountable by tracing the wallets employed in the Bybit breach to those linked with the Phemex exploit in January.
Memecoin excitement starts to subside to December 2024 figures
The memecoin frenzy that has exploded within the crypto arena with countless new tokens emerging daily is starting to settle down — at least temporarily.
The period leading to Trump’s Jan. 20 inauguration witnessed the emergence of numerous political-themed memecoins, created with varying levels of tastefulness.
Trump himself, along with his spouse, First Lady Melania Trump, launched their own memecoins, igniting worldwide fascination with the trend, accompanied by significant ethical questions.
Such concerns became apparent in February when Argentine President Javier Milei found himself in a memecoin controversy.
Recent statistics reveal that the daily creation of memecoins on Solana has dwindled to a mere 40,000, the lowest count since Dec. 25, 2024.
The memecoin craze, which led to a trader ending his life during a livestream on Feb. 22, has faced heightened scrutiny due to its gambling-like nature. Vitalik Buterin and Coinbase CEO Brian Armstrong have voiced their discontent with the industry, with the latter noting that it has “gone too far.”
The SEC has even established a dedicated division, the Cyber and Emerging Technologies Unit, to monitor the sector.
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