Cryptoccino — Friday 05 June 2026

Zcash craters more than 50% on Orchard Pool counterfeiting disclosure. Shielded Labs revealed a critical vulnerability in Zcash’s Orchard shielded pool that sat undetected for four years, theoretically allowing unlimited undetectable ZEC minting. The bug was discovered using Anthropic’s Claude and patched within days, with developers saying actual exploitation is unlikely, but the market wasn’t waiting for confirmation. Arthur Hayes publicly dumped his ZEC holdings after the news broke, short interest hit a record, and Cypherpunk Technologies, the Winklevoss-backed Zcash treasury firm, fell nearly 40%. theblock coindesk decrypt

Morgan Stanley lets wealth clients lend crypto for in-kind ETF conversions. Morgan Stanley Wealth Management has partnered with Galaxy Digital to allow eligible clients to lend Bitcoin and other assets in exchange for shares in crypto exchange-traded products. The in-kind conversion route sidesteps cash redemption friction and is a meaningful step toward integrating spot crypto holdings with traditional portfolio structures. theblock cryptobriefing

CME CEO warns CFTC-approved perpetual futures are a retail blowup waiting to happen. CME chief Terry Duffy publicly criticised the CFTC’s move to greenlight crypto perpetual futures for US venues, arguing the unlimited-duration leverage products expose retail traders to outsized risk. His comments land as the UK FCA separately flagged Hyperliquid as an unauthorised firm targeting British users, adding regulatory heat to the perps market on two continents. theblock decrypt

Ethereum’s liquidation stack builds as ETH trades below $1,600. Ethereum’s slide below $1,600 for the first time since April 2025 has put roughly $547 million in onchain positions at risk of forced liquidation at nearby price levels. Prediction markets are pricing a 71% chance of a further fall to $1,500, and the charts offer little structural support between here and that level. cryptobriefing cryptobriefing decrypt

JPMorgan, BofA and Citi form a consortium to launch a tokenised deposit network by early 2027. The Wall Street Journal reported that a bank-backed group including JPMorgan, Bank of America, Citi and others plans to launch a shared tokenised deposit network that enables instant, around-the-clock interbank settlement. Hong Kong’s Monetary Authority simultaneously announced its own expert group, pulling in JPMorgan and HSBC to scale tokenised bond issuance, signalling parallel institutional momentum on multiple continents. theblock coindesk theblock

Coinbase closes the first Fannie Mae-backed mortgage using Bitcoin as collateral. A Michigan couple completed what Coinbase describes as the first conventional home mortgage backed by Fannie Mae where Bitcoin served as the pledged collateral. The structure keeps the BTC position intact while unlocking real-estate financing, a model likely to attract attention from retail holders sitting on appreciated coins. decrypt

Radiant Capital winds down after failing to recover from its 2024 hack. The lending protocol announced it is shutting down operations, citing an inability to rebuild after last year’s exploit. Frontends and smart contracts stay accessible so users can still withdraw and manage positions, but new activity is ending. cointelegraph_defi

Mastercard deepens stablecoin settlement coverage via USDC and RLUSD. Mastercard expanded its stablecoin settlement rails to include Circle’s USDC and Ripple’s RLUSD alongside existing integrations, framing the push as a commitment to always-on payment capability. The move adds two of the largest non-Tether stablecoins to a network that processes billions of transactions annually. decrypt

Zcash Orchard Pool: four-year-old counterfeiting flaw disclosed. A researcher working with Shielded Labs found a critical bug in Zcash’s Orchard shielded pool that could have allowed silent, unlimited ZEC minting. Patched within days of discovery; whether any exploitation occurred before disclosure remains unknown. theblock coindesk

Kelp DAO hacker launders $220 million, leaving recovery hopes largely exhausted. The exploiter behind the $293 million Kelp DAO hack has moved nearly all remaining stolen funds through mixing infrastructure, rendering them effectively unrecoverable. Approximately $71 million frozen by Arbitrum’s Security Council remains the sole chunk with any recovery pathway. cointelegraph_defi

EdgeX token collapses; ZachXBT alleges insiders held nearly the entire supply. The decentralised exchange EdgeX blamed an external party for its token crash, but onchain investigator ZachXBT published evidence suggesting insiders controlled most of the float and orchestrated the dump. The project denies manipulation. cointelegraph_defi

DOJ task force freezes $3.8 million in illicit crypto tied to Southeast Asian organised crime. The operation drew on cooperation from Coinbase, SpaceX and Meta to identify and freeze funds linked to fraud networks operating out of Southeast Asia. The dollar figure is modest but the cross-sector industry participation in a law enforcement action is notable. decrypt

CLARITY Act stalls again as Senator Alsobrooks insists on an ethics deal before a floor vote. Senator Angela Alsobrooks confirmed she will not support bringing the Digital Asset Market Clarity Act to a Senate vote until a satisfactory ethics provision addressing elected officials’ crypto conflicts is attached. JPMorgan analysts separately warned the bill may have only a narrow window to pass before the legislative calendar tightens. The White House crypto adviser Patrick Witt called the bill pro-enforcement and urged action, but bipartisan consensus remains elusive. coindesk theblock theblock

House Ways and Means weighs crypto tax bills including a small-transaction exemption. The House tax-writing committee took up a slate of crypto-related measures, among them a provision that would relieve taxpayers of reporting obligations on small everyday crypto purchases. A separate lawmaker warned that allowing government payments in stablecoins would legitimise alternatives to the dollar and enable tax evasion. coindesk decrypt

South Korean police open the country’s first illegal gambling probe into Polymarket users. Seoul authorities have launched proceedings against local users of the prediction market under gambling statutes, with potential fines of up to roughly $6,500 per person. The action is the first of its kind in South Korea and arrives as US House Republicans also plan to add prediction market restrictions to a congressional stock-trading ban bill. theblock cointelegraph_regulation decrypt

EU MiCA grace period ends 1 July with ESMA saying unlicensed firms must stop serving EU clients. The European Securities and Markets Authority has confirmed that crypto businesses still awaiting MiCA authorisation cannot use the pending status as cover to keep operating after the 1 July deadline. Firms that continue serving EU clients without a licence after that date face immediate enforcement exposure. cointelegraph_regulation

What else is brewing

• Crypto PAC-backed candidates swept primaries in California and New Jersey after $3.5 million in industry ad spend, continuing the sector’s streak of primary-season wins. cointelegraph_regulation
• Russia sanctioned a 17-year-old British student after he published research alleging the ruble-pegged stablecoin A7A5 was being used to circumvent sanctions, making him reportedly the first high-school student designated by a foreign authoritarian government. decrypt cointelegraph_regulation
• Chainalysis traced a $100 million gray-market peptide economy to Chinese cartel-linked suppliers who pivoted to Bitcoin and stablecoins as the looksmaxxing trend drove demand. chainalysis decrypt
• Cardano slumped to a five-year price low as founder Charles Hoskinson warned the ecosystem faces a coming wave of project failures. decrypt
• Coinbase launched pre-IPO perpetual contracts starting with SpaceX, which is targeting a $75 billion IPO oversubscribed and set for a 12 June debut. decrypt
• A Casascius physical Bitcoin coin minted 15 years ago was redeemed this week, yielding $1.78 million in BTC to whoever had been holding the brass disc. decrypt

Last sip. Whether the Zcash Orchard bug was ever quietly exploited before disclosure may never be provable, which is precisely the problem with shielded pools.