Stablecoin consortium
“Twenty-one banks backing a stablecoin is the clearest sign yet that the growth in blockchain rails is coming from TradFi now, not crypto. Nobody’s debating whether public chains work for settlement anymore, just who gets to own the issuer.
“The real losers here are the incumbents: between Open USD in June and the banks today, Circle’s dropped 6% because the market gets that banks and card networks own the customers, and Circle just owns a token.
“My guess is the market splits three ways — Tether keeps emerging markets and offshore retail, Open USD takes internet commerce, and the bank coin becomes the institutional settlement asset sitting next to DTCC’s tokenization launch in October. The catch is speed: this started as 10 banks ‘exploring’ last October and still has no company or product, so by mid-2027 they’ll be third to market in dollars, which is why the euro token might actually be the more interesting part.”
– Alex Witt, founding general partner, Verda Ventures
“Banks spent years debating whether stablecoins were a threat to traditional finance. Now 21 major financial institutions are getting together to issue one. To me, that is the bigger story here.
“I’ve maintained for some time that stablecoins will have a direct impact on the traditional banking system. Banks ultimately have two choices: adapt to where the movement and transaction of money is going, or risk being disrupted by it. This consortium is a clear sign that some of the world’s largest financial institutions recognize that shift and intend to participate in it rather than watch it happen from the sidelines.
“I would not assume this immediately takes significant market share from USDT or USDC. They have enormous advantages in liquidity, distribution and existing network effects. But the significance goes well beyond market share. When institutions like Citi, Goldman Sachs, Bank of America, UBS and Fidelity collectively move into stablecoins, it further validates stablecoins as a core piece of the future financial infrastructure.
“From an investment perspective, that shift also expands the opportunity around the ecosystem. As more money and tokenized assets move on-chain, you create greater demand for custody, compliance, liquidity, settlement and the infrastructure connecting traditional financial institutions with blockchain-based markets. That is where I think some of the most interesting opportunities will emerge.”
– Utkarsh Ahuja, founder and managing partner, Moon Pursuit Capital
“Twenty-one banks getting together to do this is a pretty clear indication of where the market is going. Stablecoins have proven there’s demand for dollars that can move around the clock, and banks want to be part of that.
“We’re likely heading towards a world where bank-issued stablecoins, USDC, USDT, tokenized deposits and eventually multiple currencies all exist alongside each other. That creates a very practical question: if I’m holding one form of digital dollar and you’re holding another, how easily can we transact?
“That’s going to matter a lot as institutional volumes grow. Having money available 24/7 only gets you so far if liquidity and settlement between those assets still depend on banking hours. The market needs to be able to move between them just as easily as the tokens themselves move.”
– Kyle Sonlin, co-founder and president, Global Settlement Network
“Three developments this week expose the same infrastructure question. Twenty-one major financial institutions are preparing to issue a dollar stablecoin before expanding into other G7 currencies. Singapore is working through how regulated stablecoins can operate across jurisdictions. Traditional exchanges are pushing into tokenized securities and round-the-clock trading.
“These are connected developments. Banks are issuing new forms of digital money as securities and other financial assets move onchain. That creates a market where different currencies, settlement assets and securities have to work together.
“A bank-issued dollar token may need to convert into a euro stablecoin, purchase a tokenized security and ultimately settle back into a commercial bank account in another jurisdiction. The individual components can all work. What matters is whether capital can move between them efficiently, with sufficient liquidity and without adding another layer of friction. The same is true of identity: every institution on that path can verify its own customer, but that verification rarely travels with the money.
“Once institutions issue stablecoins across several currencies, they are operating an FX and liquidity market. They need to know what one form of digital money is worth against another, where liquidity sits, how deep it is and whether conversion can happen quickly enough to support the underlying transaction.
“There will not be one universal stablecoin. A separate consortium of 37 financial institutions is already preparing a euro stablecoin, while privately issued stablecoins continue to circulate at far greater scale. Tether alone has issued more than $180 billion of its dollar-backed token.
“That leaves institutions dealing with multiple issuers, currencies and regulatory frameworks at the same time. Issuing a regulated digital dollar solves the issuance question. It does not solve liquidity between that dollar, a digital euro, commercial bank deposits and other settlement assets. Without those connections, digital money simply recreates the liquidity silos that already exist across financial markets.”
– Ryan Kirkley, CEO, Global Settlement Network
Stablecoins
“As stablecoin adoption grows, issuers are increasingly becoming significant participants in the market for short-term US Treasury bills. This will place greater pressure on the infrastructure connecting stablecoins with the traditional financial system. “Stablecoins operate continuously, while banking and conventional settlement systems still follow fixed operating hours. The central challenge is ensuring institutions can move and settle capital between trusted counterparties outside the traditional banking day. “The next phase of stablecoin growth will depend on regulated infrastructure that can connect digital assets with established financial markets and support settlement on a continuous basis.”
– Jerald David, CEO, Lynq Network
SEC 24-hour trading roundtable
“For U.S. retail, overnight trading is mostly a convenience. For Asia-Pacific investors, it solves a structural time-zone problem every day.
“There is a massive international market for U.S. assets that were historically available only during U.S. trading hours. Continuous digital-asset markets are already demonstrating that demand, but adoption of tokenized U.S. assets has been slower than it should have been, partly because of the historical lack of clarity in U.S. regulatory policy.
“Continuous trading is not just a longer session; it requires a different risk, back-office, settlement and systems architecture. We built technology for 24/7 markets, so we know how significant that change is. Traditional systems use overnight windows for heavy processing, reconciliation, maintenance and clean restarts.
“Continuous markets require real-time redundancy and recovery while everything remains live. Dec. 6 is possible, but aggressive. If it slips, the overnight market remains fragmented and more reliant on proprietary data.”
– Chris Mack, CTO, Quote.Trade
SEC’s new filing
“Updating transfer agent rules so blockchain can be the official record is a real step toward on-chain U.S. securities markets. LitVM is built for that work: EVM-native tokenized securities and RWAs, with zkLTC as gas—Litecoin bridged trustlessly, not another inflatable fee token. If agents have to report which platforms they use, durability and data integrity should be the standard.”
– Aztec Amaya, co-founder, LitVM
Crypto markets
“Bitcoin is consolidating around $78,000 after gaining roughly 25% in August and briefly breaking above $81,000. The rally has been supported by renewed concerns around US debt sustainability and dollar weakness, alongside the Treasury’s expansion of long-dated bond buybacks, which helped ease yields from recent highs and strengthened demand for scarce assets.
“A sharp short squeeze accelerated the move as BTC broke out of its previous $62,000-$67,000 range. The speed of the rally leaves room for some profit-taking, and the next move will depend on whether underlying demand can sustain prices once the squeeze has run its course. Holding the $75,000-$77,000 area would help preserve the current bullish structure, while a sustained move back above $80,000-$81,000 would put the low-to-mid $80,000s back in focus.
“The medium-term setup remains constructive. Fiscal concerns, renewed ETF demand and improving spot liquidity suggest the move has broader support than short covering alone. A period of consolidation after a 25% monthly gain would be expected and could help establish a more durable base if underlying demand remains intact.”
– Ryan Lee, chief analyst, Bitget Research
“Bitcoin’s renewed momentum could translate into another wave of crypto-funded home purchases. After gaining roughly 24% in August, Bitcoin has pushed above $81,000 this week, reaching its highest level since May. That kind of rally creates a meaningful wealth effect for long-term holders and potentially gives buyers considerably more purchasing power than they had just a few months ago.
“We’re already seeing that crypto wealth make its way into property. Crypto-wealth-enabled home purchases have increased 35% year over year, highlighting growing momentum behind digital asset-funded real estate transactions.
“If Bitcoin continues to hold these higher levels, I think we could see that trend accelerate. The opportunity now is making sure trusted infrastructure exists so buyers can seamlessly convert digital assets into U.S. dollars and move that wealth into real estate without adding unnecessary complexity to the closing process.”
– John Ioannou, founder, CryptEscrow
Singapore is tackling the cross-border problem
“The Monetary Authority of Singapore has opened a consultation on implementing its stablecoin regulatory framework, including how stablecoins should be recognized across jurisdictions. Under the proposals, stablecoins jointly issued by a Singapore entity and a foreign issuer could qualify under the MAS framework where the associated risks are sufficiently controlled. MAS is also considering recognizing a limited number of foreign-issued stablecoins governed by comparable regulatory regimes, particularly for cross-border wholesale use cases.
“This goes beyond backing and redemption. Those protections are fundamental, but international markets also need clarity on whether an asset recognized in one jurisdiction can legally and operationally be accepted in another. Interoperability is often treated as a technical problem: whether two blockchains can communicate or whether an asset can move between networks. Institutional markets also require regulatory interoperability.
“A bank needs to know who issued an asset, which standards apply, what legal rights sit behind it and whether those protections are recognized by the institution receiving it. In wholesale markets, where a single transaction can involve multiple institutions and jurisdictions before settlement, those questions are unavoidable. A digital dollar and digital euro can be technically compatible. That alone does not make them institutionally interoperable. Regulated entities on both sides still need to be able to hold, exchange and settle them.”
– Kirkley
Open USD makes identity the next interoperability problem
“Open USD, the consortium stablecoin announced in June by Open Standard with more than 140 founding partners, shows the same problem from a different angle. Visa, Mastercard, American Express, Stripe, Coinbase, BlackRock, BNY, Standard Chartered and DBS are among the participants. Any partner will be able to mint and redeem without fees or volume caps; reserve income is shared with the partners, and the token is due to go live later this year on Solana, with Tempo, Base and other networks to follow.
“That spreads a single dollar token across payment networks, banks, fintechs, exchanges and merchants in multiple jurisdictions. Each of those participants already onboards its own customers, under its own regulator and to its own standard. The token is fungible. The identity assurance behind each holder is not.
“When Open USD minted through one participant reaches a bank that is another participant, the receiving institution has to decide whether it can rely on the sender’s verification or must repeat it. The 21 financial institutions planning their own dollar token face the same question among themselves, and every institution faces it again when a bank-issued dollar is exchanged for Open USD, a euro stablecoin or a tokenized deposit. Each instrument sits inside its own compliance perimeter. Nothing yet connects them.
“Regulators are drawing those perimeters now. Under the GENIUS Act, FinCEN and the banking agencies have proposed customer identification rules that cover those dealing directly with a stablecoin issuer and exclude secondary-market holders, whose only interaction with the issuer is through a smart contract. Issuers may rely on another institution’s checks only where that institution is itself federally regulated. Singapore’s consultation would require issuers to be able to trace, freeze or burn tokens used for illicit activity and asks whether holders should be verified. The obligations reach well beyond the point of issuance. The identity information does not.
“The standards to close that gap exist. Verifiable credentials let an institution prove that a counterparty was verified, to what standard and under which regulator, without the receiving institution repeating the process or the underlying data changing hands. The verifiable LEI developed by GLEIF binds wallets and smart contracts to the legal entities that control them.
“Global Layer One, the MAS-led initiative that includes the Bank of England, the Banque de France, HSBC and JPMorgan, published a programmable compliance framework in June built on these components: identity credentials linked to wallet addresses, compliance attestations reusable across systems, and policy enforced separately from the token so that rules can differ by jurisdiction without fragmenting the asset. FinCEN’s own proposal asks whether digital identity solutions and verifiable credentials should count as verification.
“What is missing is adoption at the network level. Identity checks are still repeated by every institution a transaction touches and recorded in systems that do not talk to each other. In a market where Open USD, bank-issued stablecoins, euro tokens and tokenized deposits are exchanged continuously, that is the liquidity problem in another form.
“Capital that has to be re-verified at every hop does not move at the speed of the markets around it. Interoperable money needs interoperable identity. Proof of who a counterparty is, and how it was verified, has to travel with the asset.”
– Kirkley
24-hour securities require 24-hour money
“London Stock Exchange Group is planning to introduce tokenized UK shares through a partnership with Payward, the parent company of Kraken. The products are expected to trade through LSE 24, a new 24-hour trading venue planned for the first half of 2027, subject to regulatory approval. LSEG had already announced plans earlier this year for a blockchain-based settlement service.
“In the U.S., the SEC is also examining how securities infrastructure should work when assets are represented onchain. Commissioner Hester Peirce noted this week that transfer agents are preparing for a future where many shares could be tokenized and raised questions around how existing rules should apply to onchain trading and ownership records.
“The important point here is simple: 24-hour securities require money that can move 24 hours a day. There is little benefit in allowing an asset to trade continuously if the cash required to settle it remains constrained by banking hours, currency conversion windows or fragmented liquidity.
“Tokenization can make the transfer of ownership faster, but capital still has to enter the transaction, potentially change currency, settle against the asset and then become available for its next use. If one part of that process stops while everything around it keeps running, the market still has a bottleneck. Continuous markets need continuous settlement.”
– Kirkley
Interoperability is financial market infrastructure
“Banks are issuing digital currencies. Regulators are establishing how those currencies can cross borders. Exchanges are building tokenized securities and extending trading beyond traditional market hours.
“Institutions will hold tokenized deposits, regulated stablecoins, tokenized securities and traditional assets across multiple currencies and jurisdictions. The value of that infrastructure depends on whether capital can move freely between those positions.
“That requires liquidity between currencies and settlement assets. It requires regulatory recognition across jurisdictions. It requires identity that travels with the asset, so that a counterparty verified once can be recognized by every institution a transaction touches. It requires settlement infrastructure capable of operating at the same speed as the markets it supports.
“There will not be one blockchain, one stablecoin or one form of digital money running the financial system. Different networks, issuers and currencies will coexist because they serve different institutions and different markets. The infrastructure has to connect them. Digital assets are already easy to issue and trade. The harder and more consequential job is making sure they can settle with everything else.”
– Kirkley