China's Semiconductor Advance Pressures Samsung, SK Hynix and ASML

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In Today's Note

• A report that a Chinese state-backed firm has begun mass-producing high-bandwidth memory chips reignited the semiconductor selloff, driving South Korea's Kospi down over 10%, Japan's Nikkei 225 down 4% and the Philadelphia Semiconductor index to a two-month low. The risk-off tone dragged crypto with it, as BTC fell to $63.4K, down 2.5%, and ETH slid 4.2% to $1.87K.
• Ondo Finance launched Ondo Network, an execution layer that separates trade execution from settlement inside secure hardware enclaves. Lido began rolling out Curated Module v2, its biggest core-protocol upgrade since Lido V2, the SEC approved Securitize Capital as a full Registered Investment Adviser, and Circle acquired IBM's blockchain patent portfolio.

Market Snapshot: Overnight Moves

Macro & Markets

• Crypto asset prices declined during Asian equity trading hours today, with BTC falling from $65.5K down to $63K.
• US equities erased a rally earlier in yesterday’s session and ended up finishing flat (+0.016%), while chipmakers and semiconductor stocks sold off once again (-2.23%) as jitters around AI-related capital expenditure continues to worry investors.
• The Philadelphia Semiconductor Sector index closed at its lowest level in two months.
• The selloff in semiconductor stocks was not just contained to US markets either.
• South Korea’s benchmark Kospi fell over 10% today, while the region’s leaders in memory chips, Samsung Electronics Co. and SK Hynix Inc., both declined more than 6%.
• Meanwhile, Japan’s chip-heavy Nikkei 225 Stock Average fell 4%.
• One factor that weighed on the sentiment for AI-related equities globally included improvements in China’s advanced chipmaking which could reduce the nation’s reliance on foreign semiconductor equipment and affect the global supply chain for chips.
• A report from The Information claimed that a Chinese state-backed company had begun mass producing immersion deep ultraviolet (DUV) lithography machines, a key chipmaking tool that had long been dominated by Western suppliers such as ASML.
• The risk-off moves in markets came despite oil prices retreating for a third day.
• Brent crude oil currently trades just below $87 as the US held off attacking Iran for a third consecutive day.
• President Trump confirmed that the US and Iran are currently in diplomatic talks in an effort to bring the Middle East conflict to a permanent end.
• Aboard Air Force One, he told reporters, “The only reason they [Iran] want to meet is because we’ve been hitting them very hard” and that, “There’s a good chance that something could happen. If it doesn’t, we go back to doing what we were doing.”
• Iran’s Foreign Ministry spokesman, Esmail Baghaei, on the other hand claimed yesterday that while, “it’s possible that mediators share messages from the US side about current developments,” no formal negotiations are currently taking place.
• Nonetheless, President Trump’s comments helped ease tensions around the likelihood of a further escalation in the conflict, following the past two-weeks of tit-for-tat strikes.
• According to both Axios and the New York Times, some of Trump’s military advisors recommended stopping strikes because they had reached the limit of their effectiveness and due to the risk of dwindling stocks of valuable interceptors.
• Trump however said yesterday that the US has “a lot of ammunition,” but conceded “I’d like to have more, to be honest.”
• Gold prices moved up following Trump’s comments, trading slightly below $4,100.
• The precious metal has consolidated around $4,000 since late June and remains around 20% below its all-time high near $5,600 in late January.

DeFi / Web3 / Altcoins / Crypto

• Ondo Finance, a tokenised real-world asset infrastructure company, launched Ondo Network, a new execution layer it described as the "evolution" of Ondo Chain, designed to combine centralised exchange-like speed with non-custodial trading and onchain settlement.
• The network separates trade execution from settlement by running application logic inside secure hardware enclaves, while a decentralised group of attestors verifies approved code, manages key access and connects the network to public blockchains.
• Ondo Perps is the first application built on the network, which is intended to support perpetual futures, spot markets, lending, structured products and other applications requiring fast, private and verifiable execution, while the ONDO token will continue serving as the ecosystem's governance token.
• Bitcoin treasury company, Strategy, made no bitcoin purchases or sales for a fifth consecutive week, according to an SEC filing, leaving its holdings unchanged at 843,775 BTC while increasing its U.S. dollar reserve by $525M to $3.75B as of July 26.
• The company raised the additional cash by selling approximately 5.4M MSTR shares for $544.5M and also repurchased 288,930 STRC preferred shares for $25M under its digital credit securities repurchase programme.
• Strategy said its $3.75B cash reserve is expected to cover around 2.1 years of dividend obligations.
• Ethereum treasury company, Bitmine Immersion Technologies, added 9,946 ETH to its reserve last week, lifting its holdings to 5.79M ETH worth about $11.3B, equivalent to roughly 4.8% of Ethereum’s total supply.
• The company also repurchased 6.1M common shares, bringing total buybacks to 11.6M shares under its $4B programme, while 4.92M ETH remains staked and is projected to generate around $254M in annualised revenue.
• Lido, an Ethereum liquid staking protocol, began rolling out its Curated Module v2 upgrade, consolidating more than 8M ETH worth around $16B onto 0x02 validators, a newer validator type introduced after Ethereum’s Pectra upgrade that can hold up to 2,048 ETH instead of the previous 32 ETH limit.
• The migration is expected to raise the share of Lido-staked ETH on 0x02 validators to about 52% from 32% and reduce Ethereum’s total validator count by roughly one-third, easing network load.
• Curated Module v2 also requires professional node operators to post ETH collateral that can be used to cover losses from slashing or operational failures, marking Lido’s biggest core protocol upgrade since Lido V2.
• Securitize, a tokenisation infrastructure company, said the SEC approved its previously exempt adviser subsidiary, Securitize Capital, to become a full Registered Investment Adviser, allowing it to operate tokenised funds above $100M and work more closely with institutional investors.
• The registration subjects the business to a full compliance programme and fiduciary duties, adding investor protections to Securitize’s existing U.S. stack of broker-dealer, alternative trading system, transfer-agent and fund-administration services.
• Securitize said the licence could also provide regulatory coverage for real-world asset vaults interacting with DeFi lending protocols, following recent comments from SEC Commissioner Hester Peirce that some vault curators may be acting as investment advisers.
• A U.S. federal judge issued a preliminary injunction blocking Minnesota from enforcing its new law banning prediction markets, allowing Kalshi and Polymarket to continue operating in the state while litigation proceeds.
• The judge said Minnesota likely cannot enforce the ban because federal law gives the CFTC primary authority to regulate certain derivatives markets, including prediction markets
• The ruling is a win for the platforms amid broader legal battles across the U.S., although courts in New York, Michigan and Washington have recently allowed restrictions on or blocked some of Kalshi's sports-related event contracts.
• Circle, the issuer of the USDC stablecoin, acquired IBM’s blockchain patent portfolio, comprising more than 680 patent families and nearly 1,000 issued patents worldwide, making it the largest blockchain patent holder in the U.S.
• The portfolio covers blockchain infrastructure, banking, insurance, supply-chain verification and secure cloud operations, supporting products including USDC, the Circle Payments Network and Arc, while financial terms were not disclosed.

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