Rug or be rugged (TWIF 1/24)

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There's now enough happening every week in the stablecoin ecosystem that it merits its own newsletter, so we published our first issue of The Weekly Stable today.

This week's features announcements from Nubank, Circle, 1Money, Brale, and more. If you come across interesting stablecoin news, opinions, or analysis, feel free to send it our way at [email protected] and we'll publish it.

But this week, stablecoins haven't been the biggest story in crypto news by a long-shot. The US government is pushing through a list of reforms in the digital currency space, lifting restrictions on banks' ability to work with crypto providers, and assembling a crypto task-force.

Presidential policies swing like pendelums when there is a change in leadership, and after years of an SEC that was openly hostile to crypto and an absence of rulemaking for digital currencies from any federal financial regulators, it looks like the US may finally get crypto regulation.

Which couldn't come sooner.

There are many well-known acronyms popular in the crypto community (HODL, FUD), but probably none as popular as DYOR - Do Your Own Research. Crypto has spent the last decade as the wild west of the investment world, where each NFT, DAO, ICO, project, and coin came with the warning "caveat emptor." This didn't just apply to open ponzis like Olympus DAO or algorithmic stables like Terra, but even to high-profile, venture-backed, regulator-friendly companies like FTX.

There is a good argument to be made that, if policymakers and regulators hadn't pushed crypto to the financial hinterlands, it would've been easier to enforce rules and protect consumers with similar disclosures, token registration, and audit requirements to equity markets.

But how much of a priority is that for this adminstration? Last week, the President launched his own memecoin $TRUMP – 80% owned by his own companies – which gained 12,000% in a day, before his wife launched her own memecoin $MELANIA. "At one point, the combined fully diluted valuation of the two cryptocurrencies, at about $58.34 billion, exceeded that of Occidental Petroleum," before both crashed, wiping out billions in investor gains. This isn't the couples' first foray into crypto; they previously launched an NFT trading card collection over the summer to raise campaign funds and a Melania's Eyes NFT collection back in 2021.

The crypto world had mixed feelings: “It undermines the seriousness of any liberalization of regulations that Trump undertakes for the crypto space because it makes it look self-interested,” said Castle Island Ventures' Nic Carter.

Memecoins lack the investor protections of most asset classes, but the real question is – how much do consumers want to be protected in the first place?

As hedge fund manager David Einhorn quipped this week,

These memecoin launches did not happen in a vacuum: The Gamestop short-squeeze that sent the company's price up 30x, the proliferation of leveraged and inverse leveraged ETFs, the proliferation of sports betting and online gambling all signal that investor priorities have changed.

Gone are the days of 80% stocks / 20% bonds, low VIX, and Bogleheads saving for retirement. We've entered the period of day traders, the law of the jungle, and financial nihilism.

And a new investing world comes with new rules: DYOR. Caveat emptor. Rug or be rugged.

(👍👎 Have feedback for us? Let us know. Find me at @nikmilanovic, @twifintech, and @ndm)

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Fidelity Investments launched Fidelity Stock Transfer, a digital-first stock transfer agent solution designed for publicly traded companies. Developed by Fidelity Labs, this platform enabled users to move shares, generate reports, and view their entire portfolio in one place, encompassing brokerage accounts, stock compensation, and retirement savings.

President Trump signed an executive order to strengthen American leadership in digital financial technology, establishing a working group to explore a national cryptocurrency stockpile and Senator Cynthia Lummis proposed the BITCOIN Act, aiming to establish a U.S. strategic bitcoin reserve by purchasing 1 million bitcoins over five years.

Bank of America CEO Brian Moynihan expressed the financial industry's readiness to embrace cryptocurrency, contingent upon regulatory approval. The Securities and Exchange Commission launched a crypto task force led by Commissioner Hester Peirce, aiming to establish clear regulatory frameworks for crypto assets.

U.S. Bank partnered with Agentic AI to drive innovation in banking, focusing on enhancing customer experiences through artificial intelligence. Agentic AI and Citi GPS explored the future of finance in the emerging "do-it-for-me" economy, emphasizing automated financial services. Goldman Sachs announced plans to develop artificial intelligence that emulates the decision-making processes of experienced bankers.

Meanwhile, Apple engaged in discussions with Barclays and Synchrony to replace its credit card partnership with Goldman.

WaFd Bank announced its exit from the mortgage business, leading to job cuts and impacting its earnings. HSBC decided to close its international payments app, Zing, approximately a year after its launch.

The Federal Deposit Insurance Corporation sued 17 former Silicon Valley Bank executives and directors, seeking to recover billions over the bank's collapse. American Express agreed to pay $230 million to settle allegations of deceptive sales practices. Capital One customers experienced an outage due to a technical issue with a third-party vendor, affecting access to accounts.

Coinbase announced plans to offer bitcoin-backed loans through Morpho, expanding its portfolio of crypto-based financial services.

AngelList and CoinList partnered to assist crypto startups in raising and managing funds more efficiently.

Ramp expanded into digital banking by launching a treasury product that enabled businesses to manage their cash more effectively.

Revolut introduced an instant-access savings account offering a market-leading interest rate of 5%, further diversifying its banking services and launched in-app calls to help customers identify and report phone call scams, enhancing fraud prevention efforts.

FactSet introduced an AI-powered Pitch Creator, allowing financial professionals to generate client-ready presentations automatically.

Fasanara Capital introduced a tokenized money market fund on Polygon, providing investors with blockchain-enabled access to short-term financial instruments.

Highnote announced its expansion into U.S. merchant acquiring, bolstering its payments infrastructure.

Real estate management app Boom launched BoomScreen to help property managers screen tenants.

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Nubank CEO David Vélez is considering relocating the company's domicile to Britain while exploring expansion opportunities in the U.S. market.

Upgrade targeted $1 billion in auto loan originations by the end of the year, capitalizing on its growing footprint in the auto financing space.

Q2 announced a new partnership with Alloy to deliver a joint fraud monitoring solution designed for banks and credit unions to enhance their protection against financial crimes.

PayPal reached a $2 million settlement with New York regulators over cybersecurity failures that exposed customers' Social Security numbers.

Stripe laid off 300 employees.