Policy Event ยท High impact

Notional Finance Exploit Sends Stablecoins Through Tornado Cash

A reported Notional Finance custody contract exploit led to about USD 1.7 million in DAI and USDC losses, with funds swapped into ETH and deposited into Tornado Cash. The flow affects exchange deposit monitoring, sanctions screening, victim recovery, and root-cause disclosure expectations for DeFi custody contracts.

High impact๐ŸŒ GlobalAMLEnforcementDeFiDAIUSDCETHNotional FinanceTornado CashPeckShield

APAC FINSTAB analysis

Although this is outside core APAC, it is relevant because global market-structure, enforcement, and stablecoin precedents often shape licensing expectations for APAC exchanges, issuers, custodians, and DeFi teams. Protocols/assets in scope: DAI, USDC, ETH. Named institutions or platforms: Notional Finance, Tornado Cash, PeckShield. Teams should monitor the original source, map the change to licensing, custody, disclosure, and market-access obligations, and update their jurisdiction playbooks before the next compliance review.

Compliance read-through: map this event to entity licensing, market-access, custody, disclosure, token listing, and operational-risk obligations before expanding or marketing in the affected jurisdiction.

View related AML tracker page โ†’

Related policy events

AUSTRAC Extends AML CTF Outreach To Precious Metals And Jewellery Dealers

AUSTRAC reminded precious metals, stones, and product dealers that they are being brought into Australia's expanded AML/CTF framework and directed firms to new guidance. The outreach is relevant to digital asset compliance teams because enrolment, customer due diligence, and control evidence expectations are converging across high-value asset channels.

Medium impact๐Ÿ‡ฆ๐Ÿ‡บ AustraliaAMLRegulationAUD

Bybit Pay Mesh Integration Extends Exchange Balances Into Merchant Payments

Bybit Pay integrated with Mesh, allowing Bybit users to spend exchange account balances directly across connected merchant and funding platforms without first withdrawing or converting assets. The payment path merges exchange account controls with merchant categorisation, refunds, transaction monitoring, Travel Rule duties, and freeze handling.

Medium impact๐ŸŒ GlobalExchangeAMLStablecoinBTCETHUSDTUSDC

Harmony Proposes Mainnet Shutdown And ONE Migration To Ethereum

Harmony Protocol proposed shutting down its 2019 mainnet and migrating ONE to Ethereum through a final-block snapshot and ERC-20 airdrop to matching addresses. The plan creates operational risk around exchange deposit cutoffs, omnibus sub-ledger mapping, smart-contract-held balances, bridged assets, and late deposits.

High impact๐ŸŒ GlobalRegulationExchangeTokenizationONEETH

Liquid Network Peg Out Incident Triggers Exchange LBTC Halts

Liquid Network confirmed a security incident involving funds moved through SideSwap's Peg-out Authorization Key path while saying the key itself and other keys were not leaked. Exchanges were notified to pause or prepare to pause LBTC deposits and withdrawals, making UTXO tracing, customer balance reconciliation, and reopening criteria immediate controls.

High impact๐ŸŒ GlobalCustodyExchangeAMLBTCLBTCUSDTRWA