Ethereum Under Pressure as Bitcoin Stalls and Crypto Tensions Rise

Ethereum experienced an external attack on its Zama privacy protocol. Bitcoin is trading sideways, and JPMorgan CEO Jamie Dimon is losing his temper over the Clarity crypto laws.

Bitcoin was trading at around $73,500 on Monday morning, having experienced a weekend without major price fluctuations. Bitcoin ETFs reported a $125 million outflow of capital on Friday. This made last week remarkably weak with a loss of $1.42 billion, and the entire month of May ended deep in the red for Bitcoin ETFs with a $2.43 billion outflow.

The US claims to have seized $1 billion in cryptocurrency in connection with the Iran crisis. Treasury Secretary Scott Bessent made this public at a conference, as reported by Fox News and other outlets. Bessent did not specify which cryptocurrencies were involved, but Bitcoin is likely to be part of the sum. This is because Iran levies tolls at the Strait of Hormuz, which are to be paid in BTC. This is good news for the US Strategic Bitcoin Reserve, as the seized crypto assets are likely to be added to it.

Ethereum Hit by Privacy Protocol Attack as Market Fear Builds

Ethereum struggled on Monday morning, as it had throughout the weekend, to avoid falling below the psychologically important $2,000 mark. Ethereum ETFs fared poorly last week, with a total outflow of $241 million, and losses for the entire month of May amounted to $541 million.

The news that $12.6 million has been frozen in the Zama privacy protocol is causing a stir in the Ethereum community. The funds in question were held in USDC (Circle) within this smart contract. Zama founder Rand Hindi initially expressed complete surprise on X. He later realized that almost the entire sum had been obtained through a hack and that the seizure had been ordered by a court.

However, Ethereum and the associated Zama protocol are designed to prevent such external interference through decentralization and censorship resistance; in this case, it appears that the USDC issuer, Circle, intervened.

Today’s winner is Humanity (H) with a phenomenal 67 percent gain. Humanity markets itself at the intersection of blockchain, artificial identity, and digital identity. The price jump to a new record high of $0.67 for Humanity is nonetheless surprising.

The biggest loser of the day is Zama, with a drop of around 8 percent. The reason for the decline is likely the external intrusion into the privacy protocol described above, which has damaged trust in Zama.

The crypto sentiment barometer continues to tremble in the “fear” zone, the US is again bombing targets in Iran, and the attacked country is striking back

Jamie Dimon, CEO of the major US bank JPMorgan, is abandoning his usual decorum in the negotiations surrounding the Clarity Act. In an interview with Fox Business, he called Coinbase CEO Brian Armstrong a “piece of shit” and accused his opponent of trying to influence the Clarity decision-making process with hundreds of millions of dollars.

Armstrong responded coolly with a sports analogy. Like other US banks, JPMorgan is determined to prevent crypto platforms such as Coinbase from offering interest on stablecoin deposits. This is considered the main reason why Clarity appears to be stalled in political negotiations.

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(Featured image by DrawkKt illustrations via Unsplash)

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