ESMA Warns Crypto-TradFi Links Could Amplify Financial Risks; $52M Sanctioned in Xinbi Crackdown

Europe's top securities regulator has raised fresh alarms over the deepening entanglement between crypto markets and traditional finance. In its latest risk monitoring report published Thursday, the European Securities and Markets Authority (ESMA) called for closer scrutiny of the "growing linkage between increasingly vulnerable crypto-asset markets and the broader financial system." The regulator flagged tokenized equities, recent decentralized finance (DeFi) exploits, and prediction markets as areas of heightened concern, warning that crypto-based prediction platforms could complicate detection of insider trading, wash trading, and market manipulation. ESMA's warning signals mounting regulatory pressure as stablecoins, tokenized assets, and DeFi protocols increasingly interact with legacy financial infrastructure.

In other crypto news, Hunter Biden has denied profiting from his newly launched LAPTOP memecoin after the token shed more than 95% of its value within its first hour of trading on Wednesday. At press time, LAPTOP traded at $0.8562, according to CoinGecko data. Several X users accused the project of a "rug pull," but Biden pushed back in an X post, stating: "The team's allocation is locked. Nobody on our side sold, and nobody could have. I, personally, have not made a single dollar." Biden attributed the steep price drop to thin liquidity and sniper bots that quickly absorbed token supply at launch. The Base-based memecoin draws its name from the laptop Biden reportedly left at a Delaware repair shop in 2019, a device that became central to a political controversy during the 2020 US presidential election.

Meanwhile, US authorities have restrained more than $52 million in cryptocurrency tied to Xinbi Guarantee and its vendor network as part of a coordinated enforcement action targeting the scam marketplace. The operation marks another escalation in efforts to disrupt illicit crypto-enabled commerce, with investigators tracing funds through blockchain analytics to identify and freeze assets linked to fraudulent vendors operating on the platform. The Xinbi crackdown underscores the US government's increasing use of crypto seizure powers and on-chain forensics to pursue cybercriminal enterprises operating across borders.

Across spot markets, major tokens posted modest gains: BTC traded near $111,374 (+2.10%), ETH at $4,257 (+0.84%), BNB at $708.99 (+1.94%), SOL at $98.67 (+2.87%), and HYPE leading the pack at $78.38 (+6.23%). XLM climbed 3.54% to $0.1747, while XMR held at $507.52.