Blast Shuts Down L2, Bitcoin ETFs Start October With $103M Inflow, SEC Eases Custody Rules

Blast, the Ethereum layer-2 network launched by Blur founder Tieshun "Pacman" Roquerre in 2023, is winding down operations after determining the chain can no longer sustain itself financially. The network's total value locked has collapsed more than 98% from its roughly $2.2 billion peak in June 2024, leaving Blast without a credible path to economic sustainability. Blast will shorten its withdrawal delay to 24 hours, temporarily pausing withdrawals while it unwinds assets held through Lido, a process expected to take approximately one week. Users have until October 26 to withdraw through Blast's interface; after that, assets remain accessible only via direct interaction with the network's bridge contracts on Ethereum mainnet.

US spot Bitcoin exchange-traded funds returned to net inflows on the first trading day of October, drawing $102.7 million after Wednesday's $148.7 million in net outflows. The positive start to the so-called "Uptober" follows the strongest quarter of 2026 for Bitcoin ETFs, which collectively pulled in $6.34 billion across Q3, including $2.65 billion in September alone. Combined net assets now stand at $109.3 billion, with cumulative net inflows reaching $57.6 billion, according to SoSoValue data. Bitcoin itself traded near $85,900, up 2.1% over 24 hours and 42.7% over the quarter, per CoinGecko. Meanwhile, the Crypto Fear & Greed Index slipped to 72, still signaling "Greed" sentiment across the market.

The US Securities and Exchange Commission has proposed easing crypto custody requirements for investment advisers and funds, a move that could remove a longstanding regulatory barrier for firms looking to offer digital asset products. Under the current framework, advisers have faced uncertainty about how to comply with custody rules designed for traditional securities when holding crypto on behalf of clients. The proposed changes aim to bring clearer guidelines without lowering investor protection standards. If finalized, the rules could accelerate institutional adoption of crypto funds and expand the range of regulated products available to professional investors.