This past week brought crypto to center stage as the U.S. government hosted Crypto Week (July 14–18, 2025), a historic moment that marked a sincere push toward establishing clear digital asset regulations. While Kaspa remains a decentralized and international project with no known headquarters, these developments signal growing global momentum toward broader crypto adoption. 

The Kaspa ecosystem continues to thrive. The XXIM Podcast released two exciting episodes: one delving into Kasia, a wallet-to-wallet messaging protocol that utilizes encrypted on-chain transactions, and another examining the freelancer platform, Proof of Works. Zealous Swap crossed 3 million swaps. Michael Sutton shared key ecosystem updates, and Igra Labs announced the launch of the Caravel Testnet, effective today. Kasplex also takes the spotlight at Malaysian Blockchain Week, showcasing its Layer 2 solution. And perhaps most surprisingly, even staunch Bitcoin Maxis seem to be taking a second look, getting “green-pilled” by Kaspa’s potential.

US Crypto Week: US House Passes Crypto Bills - Crypto, Finally Legal! 

This week, on July 17, 2025, the U.S. House of Representatives voted by a slim margin to advance three significant crypto bills: the GENIUS Act, the Clarity Act, and the Anti-CBDC Surveillance State Act. Each one carries major implications for Kaspa, its community, and the broader future of decentralized digital finance. 

The GENIUS Act 

On Friday, July 18, 2025, U.S. President Donald Trump signed into law the GENIUS Act (Guiding Entrepreneurship through Nationwide Innovation in U.S. Stablecoins). While the bill primarily targets stablecoin regulation, its effects will be felt across the crypto space, including on Kaspa, especially once stablecoins go live on the network.

Key Provision of the GENIUS Act for Stablecoins:

• Full 1:1 asset backing with liquid assets such as US Dollars or short-term Treasuries

• Monthly audits and disclosure of reserve holdings

• Limits on marketing claims (e.g., cannot advertise as “federally insured” or “legal tender”)

• Federal and/or state licensing to ensure unified compliance

• In the event of default, stablecoin holders are prioritized over other creditors

The bill was designed to position the United States as the global leader in digital assets, aiming to attract massive investment and innovation to the country. One notable requirement is that stablecoin issuers must fully back their assets with US dollars and Treasury securities. This has important implications for Kaspa, which operates as an international, decentralized currency and is not inherently tied to US financial instruments.

To ensure compliance with the GENIUS Act, any future Kaspa-based stablecoin to operate in the US will need to adhere to the Bank Secrecy Act, including:

• Anti-money laundering (AML) systems

• Sanctions list screening

• Know-your-customer (KYC) compliance

• Technical ability to seize, freeze, or burn coins if legally ordered

The GENIUS Act sets the stage for compliant real-world asset (RWA) tokenization by establishing a clear federal framework for stablecoins. This gives banks, asset managers, and other institutions the regulatory clarity and trust they need to use stablecoins as the on-chain cash leg for settling tokenized securities and other RWAs. 

How does this bill affect Kaspa? The GENIUS Act outlines the requirements for a stablecoin to operate in the US, including stringent standards for reserves, transparency, and compliance. When Kaspa is ready for stablecoins, this act provides a clear breakdown of what is required, allowing projects to design stablecoin integrations and the tokenization of real-world assets (RWA) with confidence and regulatory certainty, up to institutional standards. This is a major advantage because it allows Kaspa’s ecosystem to prepare for compliant payment and settlement solutions.

Moreover, this is especially important for Kaspa Kii as they release green energy RWA markets on the Kaspa platform. RWA platforms, in general, will also prefer building on top of a layer that utilizes real-world assets (such as energy and mining expenditures) to secure all network transactions. We believe Kaspa is the future for RWA development for this reason. Bitcoin is simply too slow and expensive, while PoS layers cannot provide real-world security. 

To read more about the GENIUS Act, please see the White House Fact Sheet.

The CLARITY Act

The CLARITY Act (Digital Asset Market Clarity Act of 2025) is a landmark U.S. legislation that finally defines how cryptocurrencies are regulated. The law divides oversight between the Commodity Futures Trading Commission (CFTC), which now has primary authority over spot digital commodities (like decentralized blockchain tokens), and the Securities and Exchange Commission (SEC), which retains authority over securities offerings and investment contracts.

Key Provisions:

• Digital commodities are defined as decentralized digital assets that derive their value from blockchain usage, and Kaspa’s native token, KAS, fits this model.

• The CFTC gains primary authority over spot trading of digital commodities, including the regulation of exchanges, brokers, and dealers.

• Only mature and decentralized blockchains, such as Kaspa, qualify for treatment as digital commodity networks. Tokens from these networks are generally not considered securities in secondary markets.

• Fundraising exemptions allow compliant projects to raise up to 75 million USD per year, with fewer investor restrictions than traditional securities offerings.

• Utility and meme tokens, including those on Kaspa such as KRC20s, are not treated as securities unless they are explicitly marketed as investments. (See the SEC’s Staff Statement on Meme Coins for more information.)

How does this bill affect Kaspa? Kaspa’s fair launch and decentralized design position it well under the CLARITY Act. With KAS treated as a digital commodity, the project gains legal clarity, reduced SEC risk, and improved access to U.S. markets. This legislation strengthens confidence among developers, users, and exchanges, supporting Kaspa’s continued growth as a decentralized financial network.

For more information, please see Crypto Legislation: An Overview of H.R. 3633, the CLARITY Act.

The Anti-CBDC Surveillance State Act

The Anti-CBDC Surveillance State Act aims to prohibit the Federal Reserve from issuing a direct-to-consumer retail Central Bank Digital Currency (CBDC), either directly or through intermediaries, due to serious concerns regarding civil liberties and privacy. By blocking the Fed from launching, developing, or using a CBDC for monetary policy, the Act preserves space for private, decentralized protocols in digital payments. It prevents the potential monopolization of currency infrastructure by a government-issued digital dollar.

How does this bill affect Kaspa? This legislation keeps the door open for open-source innovation by explicitly safeguarding open, permissionless, and privacy-preserving digital currencies and ensuring that future digital payments innovation remains in the hands of communities rather than centralized state actors.

Why These Three Bills Matter—Together

Individually, each Act plays a key role in shaping the U.S. digital asset landscape; collectively, they represent a pivotal regulatory breakthrough that could legitimize and accelerate the adoption of Kaspa. Taken together, these bills could open the doors for U.S. banks, fintechs, and institutions to utilize Kaspa technology in a compliant and scalable manner—potentially transitioning it from an emerging Layer 1 project to recognized financial infrastructure. Greater regulatory clarity in the U.S. could also pave the way for broader international adoption, as global markets could follow America’s lead in financial innovation.

Banks get the Green Light to Work with Crypto

U.S. Bank Regulators also got in the Crypto Week spirit, releasing a joint press release from the Federal Reserve Board, Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) on July 14, 2025. It certifies that banks can engage in “crypto-asset-related activities,” including holding crypto-assets, such as KAS, on behalf of their customers. If a bank wants to offer these services, it must follow existing laws and manage associated risks, just as it would with any other asset.

The statement does not introduce any new rules. Instead, it reminds banks that they must operate safely, protect customer assets, and follow all applicable laws, including those related to risk management, anti-money laundering, and cybersecurity.

In short, regulators are saying that banks can offer crypto safekeeping services, but only if they do it carefully and responsibly. More guidance may be coming in the future as this area continues to evolve. 

How does this affect Kaspa? This means that banks are now permitted to safely hold Kaspa (KAS) for their customers, as long as they comply with existing rules and manage risks properly. This increased regulatory clarity could make it easier for institutions to offer Kaspa-related services, encouraging greater adoption and potentially making KAS more attractive to investors, exchanges, and developers by reducing uncertainty and legal risks.

For official details, the full joint press release is available at the Federal Reserve website. 

Michael Sutton Shares Kaspa’s Next Big Updates

Kaspa Core Developer Michael Sutton sparked excitement this week when he posted an article highlighting Kaspa’s future updates. A major technical upgrade is approaching for Kaspa, with the long-awaited DagKnight (DK) protocol and a zero-knowledge (ZK) L1<>L2 bridge now being considered for a combined rollout. Though these upgrades are technically distinct, bundling them into a single hard fork offers strong advantages in terms of engineering efficiency, system safety, and ecosystem growth.

DagKnight builds on GHOSTDAG and is designed to enhance total DAG ordering, particularly under stress or attack, which is crucial for future smart contract scalability. ZK Rollups are being developed as “based rollups” that fully commit on the L1 (base layer) for sequencing, data availability, and settlement. Research is ongoing into atomic composability for multi-rollup transactions.

By combining DK and ZK upgrades, the team is introducing early defenses against MEV and oracle manipulation—addressing key DeFi risks before they take hold.

The first DK/ZK code branches are expected to begin landing in the main repository soon, marking the start of a major revolution in Kaspa’s architecture. As the post says, “All hands on deck.” This is shaping up to be one of the most important upgrades in Kaspa’s history.

Igra Labs Caravel Testnet Goes Live Today

Igra Labs has officially begun rolling out its much-anticipated Caravel Testnet—launching today, July 21, 2025. Designed to bring full Ethereum Virtual Machine (EVM) capabilities to the Kaspa network, Caravel will unfold in three key phases over the coming weeks:

1. Activation of the testnet on Kaspa's TN10 testnet (starting today, at DAA score 206700000)

2. Distribution of node software to a select group of early testers

3. Public Access, when node software becomes available to everyone

The genesis event includes the minting of testnet $IGRA and$iKAS tokens. Shortly after activation, Igra Labs will launch validator nodes, known as attestor nodes, to begin processing transactions.

Between days 7 and 10, node clients will be distributed to preselected community testers to gather feedback and promote ecosystem engagement. Roughly one to two weeks later, the node software will be opened to the public, and all users will be encouraged to run an Igra Labs node. During this phase, users will also be able to wrap TN10 $KAS into Caravel testnet$iKAS and view transactions via the network's block explorers.

Igra Labs is calling on the entire Kaspa community to get involved. To scale to over 1,000 transactions per second, the team emphasizes that this is highly complex software that needs broad testing and input. As they put it: "Brace yourselves to test Caravel with everything you have."

To follow along or get involved, join the public Igra Discord and follow @IgraLabs on X. If you're interested in becoming a node operator or builder, reach out directly.

To learn more about Igra Labs' long-term roadmap and bridging goals, check out last week's Weekly Knight article: Proof-of-Work: the Most Useful of Them All. 

Kasplex Heads to Malaysia Blockchain Week 

Kasplex is set to unveil its zkEVM Layer 2 at Malaysia Blockchain Week 2025, taking place July 21–22 at the World Trade Centre in Kuala Lumpur. This marks a significant milestone for the project, as it showcases its cutting-edge technology on a global stage.

Kaspa supporters can even score free tickets by retweeting Kasplex's announcement and commenting "See you #Kaspa @MalaysiaBCW" on X.

For event details and registration, visit malaysiablockchainweek.com. 

We've been following Kasplex closely in our Weekly Knight articles, so be sure to browse past issues to learn more about their development.

Zealous Swap hits Three Million Swaps

Zealous Swap has officially hit 3 million swaps on the Kasplex testnet as of July 18th — a major milestone for one of the most active projects in the Kaspa ecosystem. With mainnet launch on the horizon, new language support rolling out, and exchange listings in progress, Zealous Swap shows no signs of slowing down.

To read more about their journey, check out our past Weekly Knight posts, where we’ve been closely following their progress. Congrats to the Zealous Swap team for this momentous achievement. 

Moonbound Updates

Moonbound has officially upgraded its infrastructure and wiped the testnet for the last time; there will be no more resets. With fully upgradeable contracts now in place, the platform is future-ready.

The Trade Page has undergone a major UX overhaul, featuring zoomable charts, a smarter layout, and cleaner statistics for an enhanced trading experience. Token Pages have graduated and are now live, while Mission Control now tracks your tokens in real time.

An Earn Page is on the way, introducing NFT staking and $NACHO Infinity rewards via ZealousSwap. Infrastructure has been tightened, bugs have been squashed, and security has been reinforced.

Moonbound will soon support multiple languages, including French, German, and Spanish. As the team put it, "The base is built. The mission is go. Test, trade, stress it hard. We're not just preparing — we're perfecting." To the moon!

Energy Efficiency for a Green World

BankQuote_DAG published an article in collaboration with KaspaCom titled "Kaspa: An Evolution in Energy-Efficient Decentralized Architecture". This article dives into the core philosophy behind Kaspa's approach to decentralized finance—viewing money as a system governed by the same principles that govern physical energy. In nature, efficient systems minimize waste and entropy. Bitcoin applied this logic to money by using proof-of-work to tie digital value to real-world energy. Still, its linear blockchain structure results in bottlenecks, including low throughput, slow finality, and wasted computation due to orphaned blocks.

Kaspa evolves this model with a novel blockDAG architecture that replaces the single-chain design while maintaining its proof-of-work consensus functionality. Instead of forcing blocks into a sequential order, Kaspa allows multiple blocks to be created and confirmed simultaneously. This dramatically increases throughput without compromising decentralization or security. At the heart of this is the GhostDAG protocol, which organizes and confirms blocks in parallel, enabling rapid, irreversible settlement even at high block rates.

The result is a system that approaches the theoretical limits of efficiency—minimizing latency and maximizing network utilization. Kaspa functions like a monetary engine operating at the speed of light: ultra-fast, thermodynamically efficient, and economically sound. It's a unified base layer for value storage, exchange, and settlement that reflects the true potential of decentralized digital money.

Kasia on XXIM Podcast 

In this episode, the XXIM team speaks with Izio (@IzioDev), a core contributor to Kasia (Izio pronounces it like Geisha). Kasia enables secure, wallet-to-wallet communication using encrypted on-chain transactions, without relying on tokens or centralized infrastructure.

Kasia functions as both an application and a protocol. Its core innovation lies in its handshake system, where two users initiate communication by sending encrypted transactions. Messages are sent in a way that obscures the sender/receiver link, preventing metadata leakage.

Key features discussed:

• Encrypted handshakes and real-time chat via on-chain transactions

• Wallet onboarding and setup

• File sharing with compression

• Integrated KAS payments within the chat

• All actions viewable on the Kaspa Explorer

• Minimal message fees (~0.000017 KAS) with the option for users to pre-fund others' messaging costs during the handshake

Izio shared his journey—from discovering Kaspa on Reddit two years ago to contributing code to Rusty Kaspa and collaborating with CoderofStuff, Crypto Aspect, and others. He also mentioned reaching out to Kasia's creator, @Auzghosty, when the project was in early text-only stages before encryption was added. He was grateful for collaborations with Ernie and Maxim on Kasia and encouraged community members to get involved and work together on the project.

The project showcases how Kaspa's unique architecture can power not just finance, but secure and censorship-resistant communication tools. We're excited to see Kasia's future growth and the meaningful impact it will have on expanding the Kaspa ecosystem.

Proof of Works on XXIM Podcast

The XXIM Podcast was churning out great Kaspa-focused content all last week. In addition to the podcast discussed above, Ankit sat down with the Proof of Works team—Jonathan, Andrew, and Alberto—to explore their decentralized job and reputation platform built on Kaspa’s fast, secure blockchain. Proof of Works lets users worldwide find jobs, build verified reputations, and handle payments via smart contracts, all without middlemen. Currently, smart contracts on Kaspa are in early development and testnet stages. Production-grade mainnet smart contracts are still upcoming, according to the latest Kaspa ecosystem updates.

The platform supports employers and workers with verified on-chain profiles, job and task listings, and a marketplace for digital assets with flexible licensing. Early adoption is promising, with around 70–75 jobs and tasks posted on the Kasplex testnet. A minimal 0.7% fee applies only when work is completed, keeping the platform community-focused.

Proof of Works plans to onboard freelancers and developers from projects like Igra and Zealous, migrating off-chain agreements onto the blockchain for transparent work histories. The team is also exploring DAO-based dispute resolution with community jurors and aims to evolve into a Web3 payroll system automating recurring payments on-chain.

They are actively promoting Kaspa and Proof of Works through global events, including university sponsorships in Nigeria, to educate and grow the community. As Proof of Works matures and Kaspa’s smart contract functionality expands, the project hopes to become a cornerstone of the new on-chain economy—empowering freelancers, making work agreements trustless, and fostering a truly borderless jobs marketplace.

The BTC Maxis are Getting Green-Pilled 

It seems that every time I open X, I see more and more Bitcoin maxis getting green-pilled by Kaspa’s tech. One reason for that is Vijay Kailash, CFA, CFP. A former BTC maxi, Vijay has recently started championing Kaspa in a big way, sparking discussions that have drawn attention from across the Bitcoin community.

Although he still holds more BTC than KAS, his posts comparing the two have helped convert a growing number of former maxis into curious — and even invested — Kaspa supporters. What’s most surprising is that just a few weeks ago, Vijay admitted he thought Kaspa was too good to be true. Now, he’s actively engaging with the ecosystem and spreading the word.

In one of his standout posts, he wrote: “Zoom out. We're all on the same team trying to help humanity.” We couldn’t agree more. Welcome to the KAS family, Vijay.