Blast L2 Shuts Down, $103M Bitcoin ETF Inflows Mark October Start, SEC Eases Crypto Custody

Blast, the Ethereum layer-2 network founded by Blur creator Tieshun "Pacman" Roquerre, is winding down operations after determining that chain costs outpaced generated revenue with no credible path to economic sustainability. The network attracted more than $2 billion in total value locked ahead of its February 2024 mainnet launch by offering native yield on Ether and stablecoins, but DeFi TVL has plunged over 98% from its roughly $2.2 billion peak in June 2024. Blast is shortening its withdrawal delay to 24 hours, temporarily pausing withdrawals for approximately one week while it unwinds assets held through Lido. Users have until October 26 to withdraw through Blast's interface; after that deadline, assets remain accessible only via direct interaction with the network's bridge contracts on Ethereum mainnet.

US spot Bitcoin exchange-traded funds opened October with $102.7 million in net inflows on Thursday, reversing $148.7 million in net outflows the previous day, according to SoSoValue data. The positive start follows the ETFs' strongest quarter of 2026, which recorded $6.34 billion in net inflows including $2.65 billion in September as Bitcoin rose 42.7% over the three-month period. Combined net assets across the spot Bitcoin ETF complex climbed to $109.3 billion, with cumulative net inflows reaching $57.6 billion. Bitcoin traded near $85,900 at publication, up 2.1% over 24 hours, while the Alternative.me Crypto Fear & Greed Index slipped to 72 from 74, remaining in "Greed" territory.

The US Securities and Exchange Commission has proposed easing rules governing how investment advisers and funds hold crypto assets, potentially clearing a long-standing regulatory hurdle that has deterred some firms from entering the digital asset space. The proposed amendments target custody requirements under the Investment Advisers Act and the Investment Company Act, areas where legacy rules designed for traditional securities have struggled to accommodate assets like Bitcoin and Ether held in non-traditional formats. Industry participants have argued that outdated custody frameworks have effectively blocked registered advisers from offering crypto exposure to clients, a gap the SEC's latest proposal aims to address.