Daily Brief: July 29, 2026
Morgan Stanley Bets, Apple's Lawsuit, DeFi Wake-Up
TL;DR: Morgan Stanley expands its crypto offerings with new Ethereum and Solana ETFs, emphasizing institutional interest in digital assets. Meanwhile, Apple faces a lawsuit over fake Bitcoin wallet apps, questioning its app security measures. Hyperliquid's flash crash reveals DeFi's fragility, while the CLARITY Act seeks to bring regulatory clarity to the crypto space. Core Scientific transitions from Bitcoin mining to AI infrastructure, highlighting the tech industry's evolving focus.
Market Overview
📈 Morgan Stanley Expands with Ether and Solana ETFs
Morgan Stanley has just rolled out two new exchange-traded products (ETPs) for Ethereum and Solana. These funds, trading on NYSE Arca, offer a low expense ratio of 0.14%, making them the most affordable in their categories. This move comes after the success of their Bitcoin fund, signaling a strategic expansion into diverse digital assets.
The Ethereum and Solana ETFs are designed to track the performance of their respective cryptocurrencies while offering staking rewards to investors. With 50,000 shares and over $1 million in initial assets, these funds aim to attract traditional investors by providing exposure to crypto without direct ownership. This could be a game-changer for those wary of the complexities of holding digital assets.
Morgan Stanley's extensive network of 16,000 financial advisors is expected to play a crucial role in distributing these products. By leveraging this network, the firm hopes to capture a significant share of the growing demand for crypto investments. The introduction of staking options also sets a new standard, potentially pressuring other fund managers to innovate.
Why it matters: This launch highlights the increasing integration of digital assets into traditional finance, potentially driving more institutional interest and participation in the crypto market.
📱 Apple Faces Lawsuit Over Fake Bitcoin Wallet Apps
Apple is under fire as a lawsuit claims the tech giant failed to protect users from a fake Bitcoin wallet app on its App Store. Three plaintiffs allege they lost a total of $1.8 million after downloading an app impersonating Sparrow Wallet. Despite warnings, Apple reportedly didn't act swiftly to remove the fraudulent app.
The lawsuit highlights concerns over Apple's app review process, which is marketed as a secure environment. Users trusted the App Store's vetting but ended up victims of a scam. This incident raises questions about the effectiveness of Apple's security measures, especially for financial apps.
As crypto scams grow, the case could push Apple to rethink its app security strategy. The plaintiffs are not just seeking compensation; they demand stronger safeguards for cryptocurrency apps. This situation underscores the need for robust protection in digital marketplaces, where trust is paramount.
Why it matters: This lawsuit could reshape how tech giants like Apple handle app security, especially for financial applications, influencing user trust and platform policies.
🚨 Hyperliquid's Flash Crash: A Wake-Up Call for DeFi
Perpetual futures tied to SK Hynix took a nosedive on the Hyperliquid exchange, dropping 20% in a flash before bouncing back. This sudden crash coincided with a broader selloff in South Korea's stock market, where SK Hynix shares fell sharply. The incident underscores the volatility inherent in thinly liquid markets, especially when AI-related stocks are under pressure.
The crash was exacerbated by an erroneous pre-market order from NXT, which valued SK Hynix stock significantly lower than its actual price. This led to $57 million in liquidations across nearly a thousand accounts. Hyperliquid clarified that it wasn't directly responsible, pointing to Trade.xyz's control over the price feed. This raises questions about the reliability of price oracles in DeFi.
Hyperliquid, launched in 2023, aims to be a foundational layer for DeFi, similar to AWS in cloud computing. Its infrastructure allows for deep liquidity and seamless integration with various applications. However, the recent flash crash highlights the need for robust risk management and reliable price feeds to maintain trader confidence and market stability.
Why it matters: This event highlights the fragility of DeFi markets and the critical need for reliable price mechanisms to prevent future disruptions.
🔍 CLARITY Act: A Step Towards Crypto Regulation
The CLARITY Act is making waves in the crypto world as it nears a crucial Senate vote. Coinbase's CEO, Brian Armstrong, is pushing hard for its passage, emphasizing its potential to bring much-needed regulatory clarity. The act aims to establish a federal framework for digital assets, enhancing consumer protections and law enforcement capabilities.
Major financial players like BlackRock, Fidelity, and Franklin Templeton are backing the act, highlighting its importance for investor confidence. However, not everyone is on board. Critics, including NY Attorney General Letitia James, argue it might undermine local regulatory powers. The debate underscores the tension between federal and local oversight.
Despite strong support, the act's future is uncertain. Senator Jon Husted backs it, but bipartisan disputes, especially over ethics provisions, are stalling progress. With the Senate's recess looming, the pressure is on to finalize the bill. If delayed, regulatory clarity might not come until 2027, leaving the industry in limbo.
Why it matters: The CLARITY Act could set the stage for a standardized regulatory environment, crucial for U.S. leadership and innovation in the digital asset space.
🤖 Core Scientific's Bold Shift to AI Infrastructure
Core Scientific is making waves in the tech world with its strategic pivot from Bitcoin mining to AI infrastructure. The company recently reported a 42% increase in Q2 2026 revenue, reaching $164.2 million. This surge is largely due to its expansion into high-density colocation services, a move driven by the growing demand for AI applications.
A key part of this transition is a 15-year partnership with AMD, which will see Core Scientific providing 529 megawatts of AI infrastructure. This deal, potentially worth over $14 billion, allows AMD to reserve up to 1.9 gigawatts of additional capacity by 2028. It's a clear signal of Core Scientific's commitment to AI data centers.
Despite these promising developments, Core Scientific faces challenges, including a net loss of $1.15 billion due to warrant revaluation. However, the shift to AI and HPC infrastructure is seen as a strategic response to market demands, aiming for more stable revenue streams in a volatile sector.
Why it matters: Core Scientific's pivot highlights the tech industry's shift towards AI infrastructure, reflecting broader market trends and the need for adaptable business models.
