Written by: Jiayi
I firmly believe that this round of the crypto cycle is being driven by the US government through policies.
Just last week, Trump signed an executive order regarding 401(k) retirement investments, allowing a portion of retirement funds to be invested in private equity, real estate, and even digital assets. Looking back at the timeline: a few weeks ago, the GENIUS Act was officially passed, clearing the regulatory path for stablecoins; this month, the SEC also changed its attitude, publicly declaring the intent to pursue 'Crypto Everything.' From stablecoins to DeFi, from on-chain identities to tokenized assets, almost every segment is being re-integrated into the US regulatory system.
This is not a small repair but a redirection of the capital structure. The US is doing one thing: incorporating Crypto into the dollar system as the next phase's financial growth engine.
Today, let's first discuss what the US government intends to do? And which sectors should we crypto enthusiasts pay more attention to in order to maximize our benefits.
What exactly is the US government planning?
The direction of this round of policy is neither 'liberalizing transactions' nor 'allowing speculation,' but rather a systematic-level reconstruction: systematically integrating crypto assets into the US-led financial structure with a regulatory and financial framework dominated by the US. This sounds abstract, but the context has become very clear from several recent key actions.
A crucial step is the passage of the GENIUS Act, marking the first time in US history that federal law has been established for 'payment stablecoins.' The US government has personally defined the model for 'compliant US dollar stablecoins' and has opened the doors of the financial system for them. This means that stablecoins are no longer gray patches on-chain but are financial instruments that can be incorporated into monetary policy frameworks. Stablecoins are backed by government bonds; users use them for cross-border payments, banks use them for liquidity allocation, and even businesses can use them for bookkeeping. It is a genuine institutional authorization.
At the same time, the SEC has quietly completed its attitude shift. They have launched 'Project Crypto,' aiming not to expel the industry but to 'regulate' it using existing legal frameworks. They are now willing to acknowledge: not all tokens are securities and are preparing to introduce unified standards. They are also pushing forward a significant initiative: bringing on-chain trading platforms, stablecoins, DeFi, and RWA issuance into the registration framework. This 'Crypto Everything' plan focuses on three things: 1. unified regulatory standards, 2. capturing compliant funds, 3. providing the on-chain world with a 'controllable role.' This also means that in the future, you may see: legally licensed DeFi protocols, publicly funded RWA issuance platforms, and exchange wallet combinations that connect with TradFi.
Therefore, what the US government really wants is not soaring token prices, but to make this on-chain system a productive tool it can master. Allowing the dollar to flow on-chain, enabling securities to be issued on-chain, and reconstructing a new round of global order with American-style finance. This is also why I have always said: the main line of this cycle is not the self-evolution of Crypto but the 'Digital Asset Absorption Program' personally designed by the US federal government.
As policies are implemented, the market responds quickly.
From the passage of the GENIUS Act to the signing of the 401(k) executive order today, BTC once surged to $123,000, and ETH saw a monthly increase of 54%, with highs nearing $4,000.
Now let's look at the macro level. In July, the total inflow into US crypto spot ETFs reached $12.8 billion, setting a historic high. Among them, Bitcoin-related products accounted for nearly half, about $6 billion; ETH ETFs also saw significant inflow, with $5.4 billion in a single month. Meanwhile, BlackRock's Bitcoin trust IBIT has surged to $86 billion in AUM, even surpassing some S&P 500 component ETFs.
Traditional financial institutions are also madly 'taking on-chain positions.' The on-chain treasury bond fund BUIDL issued by BlackRock has not only seen its management scale rise to $2.9 billion, but mainstream exchanges like Crypto.com and Deribit have also started accepting it as collateral, indicating it can now enter the crypto financial system as liquidity. JPMorgan has also upgraded its payment chain Onyx into a brand new on-chain settlement system Kinexys, collaborating with the clearing giant Marex to conduct the first '7x24 real-time on-chain clearing.' In simple terms, it has completely integrated things that originally took days to settle and could not be moved over the weekend into on-chain processes.
Institutions are not 'exploring'; they are genuinely treating on-chain as serious business. You can continue to watch KOL statements, or you can see where the money has gone. This round of market activity is not driven by narratives, but rather, after policy settings, capital actively sought out liquidity directions. Capital has already begun to bet on targets that can 'catch the policy.'
Which sectors will first catch the policy dividends?
So, which sectors will benefit from this wave of policy dividends? Let's analyze slowly.
This opportunity is not evenly distributed; it will concentrate in a few directions. Let me give my personal judgment: stablecoins, on-chain financial infrastructure, and ZK sectors driven by compliance will be the first to reap dividends, while other segments will have different rhythms.
The direct beneficiaries of this wave of policy dividends: stablecoins.
Stablecoins are the most direct winners of this wave of US regulatory dividends. The GENIUS Act essentially issued a passport to USD stablecoins: legally issued, identity legitimized, and finally able to walk into the main thoroughfare of the US financial system with confidence. We also see that two sons of the Trump family entered the market early through WLFI to launch USD1, securing a first-mover position as the era of compliance begins.
On the day the policy was implemented, JPMorgan announced its pilot issuance of JPMD deposit tokens on Coinbase's Base chain (essentially a bank deposit stablecoin with partial reserves). Coinbase's own stablecoin USDC has also rapidly grown under the favorable compliance environment, with an additional $800 million in circulation in the past week, and it has quickly launched a crypto credit card backed by American Express, partnering with Shopify and Stripe to bring USDC payments directly into e-commerce checkouts.
The explosive growth in scale is just an appetizer. The real change is: the widening of the scope of use.
Settlement networks like Visa and Mastercard have already incorporated stablecoins into their global networks, using them for high-frequency payments, bypassing the slow and expensive fees of traditional card networks. Cross-border remittances, e-commerce, and in-game transactions will see immediate efficiency improvements once compliant stablecoins are involved. At the same time, the entry of 'regular troops' also means a steep increase in the threshold. Regulations stipulate that issuers must be subsidiaries of regulated financial institutions or licensed trust companies, and must undergo safety assessments by financial regulatory committees.
This nearly directly bars small innovators from entry, and the stablecoin market will more quickly move towards oligopoly, with an increasingly evident confrontation between the three main camps of Circle, Coinbase, and traditional banks. Coupled with regulations prohibiting interest payments to token holders, the positioning of stablecoins will revert to payments and value storage itself, without the illusion of algorithmic coins yielding excessively high annualized returns.
So how can ordinary users participate in this wave of dividends?
There are indeed pathways. For instance, several compliant platforms are offering reasonable yields on USDC, with safer paths, strong liquidity, and more suitable for stable funds: Coinbase offers about 4.1% APY for holding USDC. Binance has also recently launched flexible deposit products for USDC. In this promotion, each account can enjoy a maximum APR of 12% on up to 100,000 USDC, and funds can be deposited and withdrawn at any time.
From an investment perspective, these yields are not low and possess stability, safety, and liquidity, far more practical than keeping funds on exchanges without entry. Especially for cross-border users, holding stablecoins not only earns interest but also avoids exchange rate fluctuations and the complexities of traditional channels.
To summarize my judgment: this round of policy clears the runway for stablecoins that are stable and compliant. In the short term, USD stablecoins and their payment applications will welcome capital inflows; in the long term, they will become the ballast for on-chain finance, serving as a core bridge for the digitalization of fiat currency.
As an entry point, stablecoins accelerate the development of on-chain economic infrastructure.
The clarity of US regulation is actually paving the way for the entire localized financial economy. 'Localization' fundamentally means compliant public chains and protocols will carry more business from American institutions, and traditional finance will actively integrate these on-chain infrastructures, treating them as new foundational tools; this is also the second sector I value.
The most intuitive example is Base, which, relying on Coinbase's compliance advantages and seamless exchange integration, has successfully accommodated an increasing number of on-chain businesses from American institutions and enterprises, connecting multiple sectors such as payments, applications, and asset circulation. In this trend, I am optimistic about the ecological extension of the Base system. Besides promoting tokenized securities, it is also filling in applications with partners, such as doing on-chain stablecoin payments with Stripe, making Base the center of payment innovation; it also provides underlying settlement facilities for PayPal, JPMorgan, and others.
In the future, US payment companies, banks, and brokerages will clearly prefer to use domestic networks that are communicable and can be addressed immediately over an overseas anonymous chain. Localization, in fact, is a compliance moat.
Base itself does not issue tokens; its traffic, value, and imagination are all realized through the B3's unique bloodline channel. B3 is built on top of Base, and the founding team members are all from Coinbase. B3 inherits the compliance system's synchronicity and the user economic entry advantages of Base, which also means whether for USD stablecoin payments, institutional settlements, or compliance narratives entering the North American market, B3 holds incomparable first-mover advantages. This type of on-chain financial infrastructure, after connecting scene-based and personalized closed loops, will have a massive appeal to high-quality assets looking to go on-chain and operate efficiently on-chain in the long term. When Base experiences a large-scale application explosion, B3 will become the first choice for direct landing and scaled operations of these applications, a true super application layer and on-chain economic entry.
Additionally, I am quite familiar with the B3 team, which operates very steadily. Besides refining products, they are also continuously expanding externally; I will keep this a bit mysterious for now. It is certain that after significant collaborations are announced later, B3's position in the industry will become clearer.
Looking ahead, I don't think this is just an isolated case. With the continuous improvement of regulations, more traditional giants will follow in the footsteps of JPMorgan and Coinbase. Perhaps in the future, we will see many large banks issuing on-chain bonds, insurance companies using on-chain management for policies, and tech giants issuing stablecoins for internal settlements... After all, every large client is a stable source of cash flow for on-chain infrastructure.
Of course, this will also raise the requirements: performance must withstand massive transactions, privacy must protect enterprise data, and compliance must incorporate auditing and risk control into the system. In simple terms, this wave of US policies is pushing on-chain infrastructure from the past 'international wild growth' towards 'localized fine cultivation.' This upgrade will make localized compliant chains and modular innovation networks the biggest beneficiaries.
ZK: New Infrastructure for Privacy under Policy Vision
Which sectors that were once declared 'dead' might welcome their second chance? For example, ZK.
On August 13, OKB's surge exploded Twitter and various communities. The price skyrocketed from 46 to nearly 120, almost a threefold increase. This surge was not only due to OKX destroying 65.25 million historical repurchased and reserved OKB in one go, eliminating some potential selling pressure from the past. The X Layer upgrade also compounded structural changes on both supply and demand sides, making OKB the only Gas Token of the X Layer, directing traffic through wallets, exchanges, and payment scenarios.
Supply contraction + concentrated demand made the market quickly realize the simultaneous magnification of OKB's scarcity and usability, leading to a short-term impact of capital rushing to the exit and emotional resonance. Another trading variable is compliance expectations. The market has been closely watching the dynamics of 'OKX preparing to go public in the US,' thus holding imaginative space for its entry into the US market, though whether it can materialize still depends on US regulatory policies.
I have a clear attitude towards this sector: no FOMO, keep observing. ZK is likely to find its revival opportunity in the era of compliance, or it may just be a brief resurgence. But in any case, its movements are worth keeping an eye on.
The latest US digital asset report has clearly stated that individuals should be allowed to conduct private transactions on public blockchains and encourages the use of self-custody and privacy-enhancing technologies to reduce the risk of on-chain data leakage. The White House's 2025 digital asset policy report also mentions that ZK is a key path to balancing privacy and compliance. This shift in attitude is interesting; previously, privacy coins and mixers were on the regulatory blacklist, but now decision-makers acknowledge that to bring more traditional funds on-chain, the shortfall of 'on-chain privacy' must be addressed, and ZK is the ready solution.
At the enterprise application end. Google Wallet has launched a ZK age verification based on Succinct Labs: you can prove you are over 18 without exposing any ID details. It sounds very Web2, compliant with KYC while protecting privacy, but this time it’s running on-chain.
The underlying Succinct has also been pushed to the forefront; the token $PROVE has performed relatively well compared to other recent projects since its launch, outperforming many altcoins in the recent market. This case illustrates one thing: when top tech companies and real business scenarios start using ZK, market patience will return.
I understand ZK's revival as not just an emotional rebound but a necessary demand in the era of compliance. Once assets and transactions move on-chain, enterprises cannot accept all business details being exposed to competitors, and individuals do not want their financial trajectories to become transparent.
Moreover, the regulatory requirements are very clear. Audits must be auditable, and traceability must be verifiable. This seemingly contradictory demand is precisely ZK's stage: 'prove legality first, then conceal details.' For example, large interbank settlements can use ZK to verify that transactions comply with anti-money laundering regulations without disclosing who the clients are. Such scenarios will become increasingly common: identity verification, credit scoring... all may be reshaped by ZK. Many high-quality ZK projects have yet to issue tokens, but the policy window may prompt them to accelerate their implementation.
In the last cycle, top ZK teams kept receiving funding, but many secondary performances were 'from kings to demise,' bringing the enthusiasm for the ZK sector to a freezing point. In this round, is there a chance to reverse the impression that 'ZK secondary must perish'?
I think we can focus on two types of targets: one is teams that have not yet issued tokens but have solid technology reserves and implementation capabilities; the other is projects that have issued tokens but have a healthy chip structure and are genuinely advancing their business. For me, this sector is worth observing in the short term, although it's not yet at the level where one can blindly overweight positions, but it does not rule out the emergence of a few winners who ride the wave.
With the policy now established, a new pattern is set to sail.
As a long-term investor focused on sectors, I am very clear: once the regulatory boot drops, the structural opportunities in the market begin to be rearranged. The clarity of this round of US policy is genuinely changing the flow of capital and the order of the industry.
In the short term, the capital inflows and bullish sentiment brought about by favorable compliance have already allowed some sectors to outperform the market; stablecoin issuers and market capitalization tokenization have given the market very intuitive feedback on prices and trading volumes. This is just the first wave of capital testing. More importantly, it is the reshaping of the long-term landscape. Once the rules are clear and the thresholds are defined, only truly valuable sectors will settle down. Conversely, those that are detached from real demand and rely solely on speculative games to build up will have increasingly less room for survival in a strong regulatory environment, and industry resources will flow towards more meaningful directions.
I firmly believe that the real opportunity lies in aligning with structural changes: in the short term, observe policies and capital flows to find points of entry; in the long term, see which sectors can resonate with future financial and technological developments. I view this round as a 'fourth phase moment of the Internet' for the crypto industry. Those interested can check out my previous article on the development path of the web3 industry: the Internet once underwent rule establishment and technological transformation, facing short-term pains but ultimately ushering in a larger, healthier ecosystem.
The current crypto industry is bidding farewell to the barbaric era of disorderly growth and moving towards a mature period with rules to follow. Those who can seize the policy dividends during this window period and layout strategies will have a better chance to secure their position in the next phase of the landscape.
A new path has been laid out; those who ride the tailwind will reach the future faster.
