Bitcoin has dropped below the lowest band of the long-running Bitcoin Rainbow Chart for only the second time in its history, sliding into the original model's "Bitcoin Is Dead" zone around $62,500 — down roughly 50% from its October 2025 all-time high of $126,000. The chart, created by a Reddit user in 2014, plots bitcoin's price against a logarithmic regression and uses color bands to signal sentiment zones from "Fire Sale" at the bottom to "Maximum Bubble Territory" at the top. The only prior instance of the price breaching the floor was in 2022 when bitcoin hit a cycle low near $15,000. Analysts are split on what the breach means. XYO co-founder Markus Levin argued it's bullish: "I do not read this as bitcoin being dead, I read it as the Rainbow Chart being dead, and that is actually a bullish statement about how far the asset has matured." Bitget's Ryan Lee and Ethra COO Emad Shahin countered that the chart functions better as a sentiment gauge than a forecasting tool — it's built on historical logarithmic regression, not on the macro forces, ETF flows, or institutional dynamics that increasingly drive price today. 10x Research puts potential further downside at $55,000; a floor around $50,000 appears in several analyst models if the current chip-stock selloff deepens into a broader risk-off event.
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President Trump cancelled a signing ceremony for the 21st Century ROAD to Housing Act just hours before it was scheduled — pulling the plug on a bill that passed the Senate 85–5 and the House 358–32, and which contained a four-year ban on the Federal Reserve issuing a CBDC through 2030. Trump declared he won't sign anything until Congress passes the SAVE America Act, a strict voter ID and elections bill that currently lacks the Senate votes to clear the 60-vote threshold. The crypto industry had welcomed the CBDC ban as one of its major legislative wins of the year. It still becomes law automatically after ten days if Trump neither signs nor vetoes it — and both chambers passed it by margins that clear the veto-override bar — but the signing delay also creates a knock-on risk for the Clarity Act: Trump's stance suggests he may hold other legislation hostage, and the Senate calendar only has about five weeks before August recess. TD Cowen called the situation "a reminder of how quickly political dynamics can shift in Washington, even on bills with strong bipartisan support."
This week's Protocol Newsletter synthesizes Ethereum's most turbulent week in years: the simultaneous launches of EthLabs (backed by Bitmine, SharpLink, and Joe Lubin), the Ethereum Foundation's 54-person layoff and 40% budget cut, Vitalik's transition to an endowment model, and Hsiao-Wei Wang's resignation — the ninth senior departure since January. The bullish counterargument: Consensys' Joe Lubin told CoinDesk the EF should adopt a narrower role focused on core technology stewardship. Tom Lee's Bitmine bought 126,971 ETH last week at a cost of approximately $214 million — its largest single Ethereum purchase of 2026 — despite Lee's own prior public guidance to reduce buying activity amid falling prices. The structural case: corporate treasury holders including Bitmine (nearly 5.4 million ETH) and SharpLink now collectively control roughly 7% of circulating supply and generate $500 million in annual staking rewards, replacing EF grants as the primary funding mechanism for the ecosystem. "The Ethereum Foundation should adopt a narrower role," Lubin said — and some of the biggest names in crypto appear to agree that a leaner EF is, counterintuitively, a reason to be more optimistic about Ethereum, not less.
