Organization & Compilation: LenaXin, ChainCatcher
Original title: (Stablecoins Are Now Legit, but That’s Only the First Step - Bits + Bips)
Host: Steve Ehrlich, Chief Writer at Unchained Kingdom; Noelle Atchison, Editor-in-Chief and Chief Analyst at (Crypto is Macro Now).
Guests: Ram Alawalia, Head of Lumida Wealth Management; Cosmo Jiang, Senior Trader and Liquid Strategy Portfolio Manager at Pantera.
Podcast Date: July 24, 2025
ChainCatcher Editor's Summary
This article is compiled from the Unchained podcast segment Bits + Bips. With the introduction of the (GENIUS) bill and the stablecoin bill, the United States has established a clear regulatory framework for stablecoins for the first time.
Why does Noelle say the stablecoin law is just the beginning? What does the latest rebound in Ethereum mean, and what is its essence? How does Trump's threat to fire Powell shake macro sentiment?
This episode will discuss topics such as the rise in Ethereum prices, the interpretation of the (GENIUS) bill, the independence of the Federal Reserve, and the rise of emerging crypto asset management companies.
ChainCatcher has organized and compiled this.
Highlights Summary
Noelle: The stablecoin bill is just the beginning of the regulatory process.
Noelle: Tokenized money market funds may become the biggest winners.
Noelle: The core income source of Circle is spread income, and interest rates will eventually fall.
Noelle: Current macro data is not unexpected, CPI meets expectations, there is insufficient reason for interest rate cuts, and economic growth data is stable.
Cosmo: The legislative improvement of market structure and regulatory framework is where the fundamental change lies.
Cosmo: The DeFi sector will become the biggest beneficiary.
Cosmo: The core challenge faced by market judgment is how 'others' are defined in the crypto space based on traditional investment wisdom.
Cosmo: The key to the success of tokens lies in the scale effect.
Cosmo: While Coinbase is the first choice, the market can fully accommodate other competitors, although the allocation weights may differ.
Ram: It is expected that the importance of payment giants like Visa and MasterCard will significantly decline over the next decade.
Ram: There is an interesting paradox in market operation mechanisms: the more decentralized the system, the more centralized market leadership is needed.
Ram: The 'shareholder as user' innovation reshapes the market landscape.
Ram: Treasury Secretary Besson clearly stated that 'stablecoins can strengthen the dollar's hegemony,' and this policy direction significantly benefits Ethereum, which carries the main stablecoin traffic.
Ram: More cases are expected to emerge in the fourth quarter, and the market may experience a warming trend by the end of this year or early next year.
The stablecoin law is just the beginning.
Steve: What are your profound impressions of the bill signing ceremony itself, or the crypto industry's reaction over the past 72 hours?
Noelle: The U.S. cryptocurrency legislation has made substantial breakthroughs. As the world's largest financial market, the U.S. has introduced a dedicated regulatory bill for cryptocurrencies for the first time, which is milestone significance.
The stablecoin bill is just the beginning of the regulatory process. A more complex regulatory framework is still being constructed.
New regulations will allow the use of ETH or Bitcoin for daily consumption and are expected to be included in pension and 401k account investment ranges.
Ram: The bill's final passage benefited from Trump's gathering of 12 congressional leaders to negotiate at the White House. His subsequent tweet about Bitcoin also created the 'Trump tweet effect.'
However, the market response is unexpected. Despite the simultaneous arrival of two positive factors—the passage of the bill and Trump's tweet—Bitcoin's price this week is lower than last week's. This 'profit-taking leads to a peak' phenomenon is not the first time; fringe assets like Litecoin are unusually active, indicating a strong speculative atmosphere in the market.
Cosmo: I remain optimistic. Bitcoin has previously reached an all-time high, with considerable gains this year. Although the short-term price response is muted, the improvement of market structure and regulatory framework is the fundamental change.
The most noteworthy aspect of the (GENIUS) bill is the direction of banks. Institutions like JPMorgan, Citigroup, and Bank of America have all indicated plans to launch their own stablecoins or tokenized deposits, showing that the transformation process may accelerate beyond expectations. These banks have assembled digital asset teams of hundreds of people and invested tens of millions of dollars in R&D over the years.
Can Visa and Mastercard survive the disruption of stablecoins?
Steve: The passage of the first cryptocurrency bill marks a new phase for the industry. Subsequent regulatory details and market responses will determine whether it can translate into substantial development momentum. The market faces a crucial choice: is it 'profit-taking and exiting' or continuing to build positions?
Ram: This milestone will bring two fundamental changes:
1. Cryptocurrencies and fintech are deeply integrating, reconstructing financial infrastructures such as custody, lending, and payments.
2. The traditional payment system will undergo structural changes. The importance of payment giants like Visa and MasterCard will significantly decline over the next decade. The (GENIUS) bill is a significant starting point for this change.
Noelle: I am cautious about the rapid replacement of payment giants. The core competitiveness of Visa and MasterCard lies in decades of accumulated customer service, dispute resolution, and merchant management systems.
Moreover, if payment giants like Alipay decide to enter the stablecoin field, the market competition landscape may become more complicated.
Cosmo: How will the profit pool of stablecoins be distributed? Will it create entirely new businesses, or will it be absorbed by existing financial institutions?
Noelle: In a declining yield environment, Circle's core spread income model will face challenges. Investors may turn to the DeFi space in search of higher returns.
Ram: The market will show diversified development trends. Traditional banks and tech giants will compete, and in the next three years, various segmented stablecoins targeting different scenarios will emerge. The ultimate beneficiaries will be the end consumers.
Who will benefit the most from the new stablecoin law?
Steve: Can everyone share a less obvious beneficiary or loser?
Ram: Traditional financial institutions will become the main beneficiaries. Custodia Bank, led by Caitlin Long, and infrastructure banks like Cross River Bank will benefit significantly. Traditional banks' advantages in capital circulation will allow them to obtain considerable channel fees when connecting traditional finance with on-chain activities.
Noelle: Tokenized money market funds may become the biggest winners. In the future, funds could be smartly transferred between payment accounts and tokenized money market funds, achieving 'smart financial asset management.'
Cosmo: The DeFi sector will become the biggest beneficiary. The on-chain characteristics of stablecoins will guide massive funds into various DeFi protocols. Users will naturally choose on-chain innovative services. Regional banks may become the biggest losers, as their long-term decline trend will accelerate.
Ram: What about intermediaries? Another type of intermediary is facing risks: investment banks. As the scope of asset tokenization expands, their traditional business models will be impacted.
Cosmo: The laws of capitalism always point towards lowering transaction costs and improving consumer welfare. Ram's viewpoint hits the nail on the head: crypto technology and on-chain infrastructure are reshaping the structure of capital markets, and we may be witnessing the prologue of this transformation.
Are regional banks on the brink of bankruptcy?
Steve: In a situation with limited resources, should regional banks fully invest in stablecoin competition or leverage their position to lay out broader blockchain applications? Are regional banks on the brink of bankruptcy?
Ram: Regional banks lack technical capabilities and can only rely on infrastructure providers like FIS and Jack Hunter to offer generic stablecoin solutions, which actually reinforces the advantages of large banks. Infrastructure providers like Paxos are becoming potential winners. They are still developing stablecoins for platforms like Robinhood and Kraken, replicating the distribution network established by Circle through Coinbase.
This confirms the 'shovel seller' theory: just like the most profitable during a gold rush are the tool vendors, in the stablecoin wave, infrastructure providers (like Paxos) that provide technical solutions for trading platforms may be more robust than issuers.
Steve: Are you referring to the regulatory issues Paxos faced when issuing BUSD in collaboration with Binance?
Ram: To be precise, USDG is the stablecoin token they are issuing.
Noelle: Wallet service providers will encounter significant development opportunities. The core pain point for user experience is the interoperability between different stablecoins. This is precisely the key area that wallet design can address.
What does the latest rebound in ETH mean?
Steve: What do you all think about the significant rise in Ethereum?
Cosmo: The ETH/BTC exchange rate has nearly doubled in two months, reflecting a significant shift in market expectations. Large-scale purchases by digital asset custody institutions have become the main driving force, with the core logic being that Ethereum will serve as the infrastructure layer for the stablecoin ecosystem.
Steve: Ethereum is still in the expansion process. What does this mean for listeners evaluating different ETH investment channels? For example, how to choose between leveraged ETFs and crypto asset management companies?
Cosmo: Although core issues like the economic model of ETH still exist, several key changes are occurring:
1. Organizational culture innovation
The long-standing efficiency problem of the Ethereum Foundation is changing.
The organizational culture transformation driven by the new director Tomas has shown significant results.
A fundamental shift is taking place in the interaction model with venture capital, DeFi protocols, and traditional financial institutions.
2. Improvement of the regulatory environment
The legislation for stablecoins provides certainty for the industry.
Milestone events like Circle's IPO enhance the credibility of asset classes.
The value capture ability of Ethereum as underlying infrastructure is strengthening.
These changes constitute substantial fundamental improvements. The positive cycle currently experienced by the Ethereum ecosystem is a typical feature of fundamental qualitative change.
Noelle: There are still cognitive gaps in the crypto space. When policies take effect and become news, new investors begin to pay attention, and the market is far from fully priced. The current advancement speed of government bond allocation strategies has also not been fully digested.
Ram: This involves two dimensions: policy direction and personal influence. Stablecoin policies are bringing structural changes that significantly benefit Ethereum.
There is an interesting paradox in market operation mechanisms: the more decentralized the system, the more centralized market leadership is needed. The current insufficient market voice faced by Ethereum is related to Vitalik's relatively low-key public image. In contrast, in the Solana camp, people like Kyle Samani are adept at meme propagation.
Steve: How will this round of ETH market end? Current market bubble signs are obvious, and FOMO sentiment is spreading. How should investors respond?
Cosmo: The core issue is how to define 'others' in the crypto market. Currently, crypto-native capital has fully laid out, and although traditional financial capital is entering slowly, there are already signs. This gives me confidence in my positions, but the real wave of allocation still needs to wait.
What is the nature of the surge in digital asset financial companies?
Steve: As the head of Pantera's crypto asset management business, could you share your market observations?
Cosmo: We focus on innovative projects. Take the government bond company DFTV on the Solana chain as an example; its pioneering value was quickly validated by the market, with institutions like Tether and Cantor subsequently launching similar products. This field is experiencing explosive growth.
Although the industry will experience a survival of the fittest, we continue to increase investments. Witnessing the birth of a new category of enterprises is a rare investment opportunity.
Steve: How to identify truly high-quality investment targets? When reviewing numerous financing proposals, what key factors do you use to make decisions?
Cosmo: Business models must first be validated through sustainability. The current market has shown obvious homogeneous competition, and the industry is undergoing a process of commodification.
The key to success lies in the scale effect, which requires the token itself to possess:
1) A sufficiently large market capitalization (usually needs to rank in the top 10-15).
2) Mainstream market awareness
3) Clear value proposition
Execution capability is the decisive factor. The team needs to possess both crypto-native marketing capabilities and traditional financial tool application capabilities.
Ram: As cross-asset investors, we notice that the market has shown signs of fatigue. The seasonal characteristics of cryptocurrencies are particularly prominent, coinciding with Bitcoin's traditional weak cycle next month.
Digital asset prices are more reliant on market momentum than fundamental indicators. The current 'self-reinforcing upward trend' mechanism is weakening, indicating that momentum-driven markets may face a turning point.
(Note: The 'stampede engine' effect is explained as the self-reinforcing mechanism of the upward trend.)
Will the wave of crypto companies going public match the success of early companies?
Noelle: Recently, many crypto giants submitted IPO applications. Does this mean that the market's enthusiasm in the second half of the year will not match that of the first half?
Ram: The trend of a surge in crypto asset management companies is still ongoing. However, as similar projects increase, market attention is becoming dispersed, making it more difficult for investors to focus on industry leaders.
Noelle: The phenomenon of crypto companies like BitGo, Grayscale, and Bullish clustering for IPOs is worth noting. How long will this enthusiasm last?
Ram: The market still shows investment enthusiasm, but valuation systems are clearly differentiated. Some private projects are valued at only 35% of their listed peers, while Coinbase’s price-to-earnings ratio reaches 60 times. More IPO cases are expected to emerge in the fourth quarter.
Noelle: After the overvaluation in 2021, VC funds suddenly dried up. Cosmo, have you observed signs of recovery in VC activity?
Cosmo: Market funds are polarized. The benchmark effect of Coinbase's 60 times price-to-earnings ratio has made Pre-IPO rounds more attractive. Seed rounds and other early investments remain active, but intermediate stages like Series A-C rounds are relatively quiet.
Steve: Despite the optimistic narrative, why is venture capital activity still lagging?
Cosmo: The public market inherently accommodates many 'qualified' companies. For asset management, the portfolio will inevitably allocate multiple crypto trading platforms, but the weighting will differ.
How Trump's threat to fire Powell shakes macro sentiment.
Steve: What does Noelle think about whether Trump should fire Powell? With the earnings season approaching, could you briefly share your focus and analysis points?
Noelle: Current macro data meets expectations, and there is insufficient reason for interest rate cuts. This week, focus on housing data.
Tariff policy impacts are evident, with significant price increases for affected categories. Trump's threat to fire Powell is worth noting, as it has substantially undermined the Federal Reserve's independence.
The loss of independence of the Federal Reserve will lead to long-term inflation deterioration. The possibility of an interest rate cut this year is basically excluded, and Powell must defend policy independence.
Steve: Even if Trump replaces Federal Reserve Board members, will the new appointees succumb to presidential will? Will other members maintain their independent stance?
Noelle: Federal Reserve policy depends on collective decision-making. The current median view in the FOMC is relatively hawkish, and Trump can only replace at most two seats. The key lies in the traditional independence of the Federal Reserve. Members will resist political pressure.
It is necessary to distinguish the inflation driving factors: tariff shocks are one-time impacts, while the real risk lies in fiscal imbalances.
Steve: This week, the China-EU summit, with von der Leyen visiting China next week. If exports to the U.S. cannot proceed, will Beijing turn to the European market for dumping? What are your expectations?
Noelle: The originally planned EU-hosted meeting was forced to adjust due to a counter-invitation from China, with the agenda compressed to one day, leaving the European delegation in a passive position.
The tense situation stems from the EU's recent inappropriate remarks toward China, exposing its strategic dilemma. The vulnerabilities of the European economy are becoming increasingly apparent.
Conclusion segment: Share viewpoints
Steve: As you all know, I like to ask each guest to share an eagerly anticipated contrarian opinion to spark a debate on Twitter.
Ram: Newbank is an interesting case. With the progress of the pardon negotiations, tariffs previously imposed due to the treatment of Brazil's former prime minister are expected to ease. I believe there are investment opportunities in the Brazilian market, and Newbank is worth watching.
Cosmo: The impact of Coinbase's inclusion in the S&P 500 in April has been underestimated. This change has forced global asset managers to readjust their digital asset allocation strategies, and currently, most institutions have chosen to overweight.
Noelle: I will focus on Hong Kong (stablecoin bill). After the bill takes effect on August 1, it may launch Hong Kong dollar or renminbi pegged stablecoins. Against the backdrop of China's promotion of digital renminbi cross-border payments and expanding non-dollar trade, this trend is worth noting.
