The crypto market was under pressure as bitcoin traders took profits and a broader risk-off mood, reinforced by concerns over artificial intelligence and geopolitics, weighed on digital assets. Sharp volatility in oil prices added to the cautious backdrop, while large withdrawals from U.S. spot Bitcoin ETFs set the tone for the session.
The day's news spanned market structure, protocol security and regulation, from a change in how Bitcoin Core discloses AI-discoverable bugs to a Senate inquiry into Tether and new blockchain-infrastructure moves in China and Southeast Asia.
ETF outflows reverse October's gains
U.S. spot Bitcoin ETFs recorded about $635 million in net outflows on Thursday, the largest single-day withdrawal since late June, according to Cointelegraph and Decrypt. The exit exceeded the inflows of the previous three sessions and pushed October's flows back into negative territory.
The pressure extended across major crypto ETFs. Ether funds lost about $111 million and Solana ETFs about $9 million. Cumulative net inflows into Bitcoin ETFs are declining, while total assets remain around $100 billion.
The scale of the move matters because ETF flows have become a visible gauge of institutional demand. A single day of withdrawals does not establish a trend, but it changes the monthly picture and can amplify price pressure when liquidity is thin.
Bitcoin Core adapts disclosure to AI bug hunting
Bitcoin Core adopted a new vulnerability-disclosure policy on October 23 aimed at the growing role of large language models in finding software bugs. Vulnerabilities that can be easily discovered with an LLM will be fixed quickly and published with a security advisory instead of being held under a long embargo, according to CoinDesk and Decrypt.
The change was proposed by Antoine Poinsot of Chaincode Labs. Fixes for easily LLM-discoverable bugs will be backported to all supported releases. Critical vulnerabilities such as coin theft or a chain split remain outside the new rule.
The policy follows an intensive summer of AI-assisted review. A volunteer Bitcoin Red Team found roughly 4,962 findings across 390 repositories, a volume that makes prolonged secrecy increasingly difficult to sustain.
For Bitcoin, the shift touches the core of network security. Faster disclosure can help users and operators patch sooner, but it also compresses the window between discovery and exploitation. The carve-out for critical bugs preserves a more cautious approach where a flaw could threaten funds or split the chain.
Ethereum delays Glamsterdam on Hoodi
Ethereum developers postponed activation of Glamsterdam on the Hoodi testnet after ChainSecurity raised concerns about gas changes in EIP-8037 and EIP-8038 that could weaken smart-contract protections, Cointelegraph and Decrypt reported.
ChainSecurity identified 13 potentially affected contracts. The risk is tied to the gas-refund mechanism for failed calls. Glamsterdam has already been activated on Sepolia, but the Hoodi delay affects the path to mainnet.
Hoodi is a critical testnet, so the delay carries weight beyond a single rehearsal. It does not by itself derail the upgrade, but it shifts attention to how the gas changes interact with older contracts and gives developers more time to assess exposure before mainnet deployment.
Initia exploit puts on-chain security back in focus
Initia halted its L1 and rollups after an unauthorized token mint, according to Cointelegraph and The Defiant. The network was stopped at 15:41 UTC, and the incident is still being assessed.
Blockchain researcher Spreek estimated that about $2.6 million was drained, with part of the proceeds converted into ETH. Roughly 1,135.5 ETH was consolidated in a single wallet.
Agora said it froze an AUSD account linked to the incident after 1.4 million AUSD was converted into ETH. D2 Finance linked the exploit to a vulnerability in a Move function. The details remain unconfirmed, and the final scope of the loss may change.
The case matters beyond Initia. A halt of an L1 and its rollups, combined with action by a stablecoin issuer, shows how quickly a smart-contract flaw can spill into on-chain liquidity and stablecoin markets. The reported link to a Move function will also draw scrutiny to security assumptions in Move-based systems.
Regulators widen their focus
On Capitol Hill, Senator Richard Blumenthal sent a request to Tether CEO Paolo Ardoino about a $6.3 million Nxum deal involving Bo Hines, a former White House adviser who later became CEO of Tether's U.S. unit. The request was sent Thursday and seeks a response by November 3, according to Cointelegraph and Decrypt.
The Wall Street Journal reported the Nxum-Tether transaction. Blumenthal alleges attempts to conceal opposition to lobbying on the GENIUS Act, while Tether says an external investigation found no violations. The probe links Tether to the lobbying fight over the GENIUS Act and raises questions about potential conflicts of interest.
Separately, the SEC's Division of Examinations included tokenization in its 2027 examination priorities for the first time, specifically in the context of clearing agencies and Regulation SCI. The list also cited superintelligence and other advanced technologies as a risk for the first time, Cointelegraph and Decrypt reported.
Cryptocurrency was not listed as a standalone priority for the second year in a row, even as tokenized securities received explicit attention. The shift suggests that the regulatory focus is moving from crypto as a category toward specific activities and technologies that touch market infrastructure.
In New York, Attorney General Letitia James asked a court to order the founders of NovaTech and AWS Mining to pay $1.37 billion in a crypto Ponzi case. The request comprises $1.13 billion in restitution and about $232 million in interest, following a default judgment, according to Cointelegraph and Decrypt.
More than 11,000 New York investors suffered losses. Four promoters have already agreed to pay nearly $6 million.
Blockchain infrastructure advances from Beijing to Hong Kong
China has set a target of substantially completing a national blockchain network by 2030 as part of its 15th Five-Year Plan for national informatization. The plan emphasizes trade and finance in the Yangtze River Delta and industry in the Chengdu-Chongqing region, with a focus on standardization and data circulation, Cointelegraph and The Defiant reported.
Beijing's push comes alongside continued restrictions on cryptocurrency business. The distinction matters: China is investing in blockchain infrastructure and data systems while keeping a hard line on speculative crypto activity.
In Southeast Asia, the central banks of Malaysia and Thailand joined Singapore's BLOOM initiative, which tests cross-border payments using stablecoins and tokenized deposits. BLOOM was launched by the Monetary Authority of Singapore in October 2025 on the foundation of Project Orchid. Participants include Airwallex, Mastercard, Ripple, Visa and the World Bank Group.
Hong Kong saw a bank-led retail stablecoin move as HSBC reportedly launched RedCoin, an HKD-pegged token for transfers and payments through PayMe, which serves more than 3.3 million users. The token is issued with 1:1 backing in Hong Kong dollars, according to reports, and a wallet is expected to appear in the HSBC HK Mobile Banking app later. HSBC received a stablecoin issuance license in April.
Because the RedCoin launch is flagged as unconfirmed, the reported details should be treated with caution. If confirmed, it would mark one of the clearest examples of a major bank bringing a regulated retail stablecoin into a mass-market payment app under Hong Kong's stablecoin framework.
The latest developments point to a market caught between institutional outflows and rapid structural change. Bitcoin and Ethereum are dealing with security and upgrade questions, a fresh exploit has renewed concerns about on-chain risk, and regulators across several jurisdictions are sharpening their focus on stablecoins, tokenization and enforcement. The common thread is that crypto's infrastructure is maturing under more scrutiny, not less.