Category: cryptocurrencies

Europe’s landmark crypto regulation, MiCA, was intended to bring an end to the “Wild West” era of stablecoins. With proof-of-reserves, capital rules, and redemption requirements, the framework appears comforting on paper. However, in practice, MiCA does little to mitigate systemic risks that may arise when stablecoins integrate into the global financial ecosystem.

The irony is compelling: a regulation designed to contain risk may inadvertently legitimize and entrench it.

The contagion problem: when DeFi meets TradFi

Stablecoins have long existed in the shadowy corners of finance, serving as a crypto convenience for traders and remitters. Now, with MiCA enacted, and the UK and U.S. soon to follow, the division between crypto markets and traditional financial systems is blurring. Stablecoins are transitioning into regulated, mainstream payment instruments, gaining enough credibility for everyday use. This newfound legitimacy transforms the landscape.

Once a stablecoin is regarded as a reliable form of money, it competes directly with bank deposits as a type of private money. When deposits shift from banks to tokens backed by short-term government bonds, the conventional processes of credit creation and monetary policy become distorted.

In this context, MiCA addresses a micro-prudential issue (ensuring issuers remain stable) but overlooks a macro-prudential one: what occurs when billions of euros transition from the fractional-reserve system into crypto instruments?

Governor Bailey’s warning and the BoE’s cap

The Bank of England has identified this risk clearly. Governor Andrew Bailey recently stated that ‘widely-used stablecoins should be regulated like banks’ and suggested central-bank support for systemic issuers. The BoE is now proposing a cap of £10,000-£20,000 per person and a limit of up to £10 million for businesses on systemic stablecoin holdings, indicating a modest but significant precaution.

The message is straightforward: stablecoins represent more than just a new payment method; they pose a potential threat to monetary sovereignty. A significant movement from commercial bank deposits to stablecoins could jeopardize banks’ balance sheets, reduce credit availability to the real economy, and complicate monetary policy transmission.

Thus, even regulated stablecoins can become destabilizing on a large scale, and MiCA’s framework of reserves and reporting fails to tackle that inherent risk.

Regulatory arbitrage: the offshore temptation

The UK has adopted a cautious approach. The FCA’s proposals are comprehensive regarding domestic issuers but notably lenient toward offshore ones. Their own consultation acknowledges that consumers ‘will remain at risk of harm’ from overseas stablecoins used in the UK.

This creates a growing loop of regulatory arbitrage: the stricter a jurisdiction becomes, the more motivation issuers have to shift offshore while still catering to onshore users. Consequently, risk does not vanish; it merely migrates beyond the regulator’s jurisdiction.

In essence, the legal recognition of stablecoins is reshaping the shadow-banking dilemma into a new form: money-like instruments circulating globally, lightly regulated, but intricately linked with established institutions and government bond markets.

MiCA’s blind spot: legitimacy without containment

While MiCA is commendable for imposing order, it is based on a precarious assumption: that proof-of-reserves equates to proof-of-stability. This is not necessarily true.

Fully backed stablecoins can still trigger massive sales of sovereign debt during a redemption crisis. They can exacerbate liquidity shocks if holders perceive them as bank deposits without the protection of deposit insurance or a lender of last resort. They can also promote currency substitution, steering economies toward de facto dollarization through USD-denominated tokens.

By formally ‘endorsing’ stablecoins as safe and supervised, MiCA effectively grants them the legitimacy to expand without providing the macroeconomic tools (like issuance limits, liquidity facilities, or resolution frameworks) necessary to manage the potential consequences.

The hybrid future, and its fragility

Stablecoins occupy a space where DeFi and TradFi converge. They leverage the credibility of regulated finance while offering the seamless freedom of decentralized platforms. This “hybrid” model is not inherently problematic; it is innovative, efficient, and globally scalable.

However, when regulators consider these tokens merely as another asset class, they overlook their true nature. Stablecoins are not liabilities of an issuer in the traditional banking context; they are digital assets, a new form of property that functions as money. As this property gains widespread acceptance, stablecoins blur the boundary between private assets and public currency, creating systemic implications that regulators can no longer ignore.

The BoE’s cap, the EU’s proof-of-reserves, and the U.S. GENIUS Act all indicate that policymakers are beginning to recognize parts of this risk. Nonetheless, a comprehensive, system-wide approach that treats stablecoins as part of the money supply rather than merely as tradable crypto assets remains elusive.

Conclusion: MiCA’s paradox

MiCA represents a regulatory milestone but also a pivotal moment. By legitimizing stablecoins, it brings them into the financial mainstream. By concentrating on micro-prudential supervision, it risks ignoring macro-economic fragility and broader regulatory issues. While asserting oversight, it may inadvertently promote global arbitrage and systemic entanglement. In short, MiCA may not prevent the next crisis; it could be quietly contributing to its creation.

Cathie Wood’s ARK Invest expanded its crypto investments again this week, increasing its stake in exchange Bullish by more than 105,000 shares, valued at approximately $5.3 million.

This acquisition, spread across ARK’s three actively-managed ETFs — ARKK, ARKW, and ARKF — raises ARK’s total position in Bullish, RialCenter’s parent company, to about 2.27 million shares, estimated at $114 million at the closing price on Friday of $50.57 per share.

The investment emphasizes ARK’s commitment to digital asset infrastructure, an area the firm has been allocating to increasingly, including when Bullish went public via a $1.1 billion IPO earlier this year.

That initial offering had ARK as a day-one investor with $172 million in backing. Bullish now comprises 0.94% of ARKK, 0.95% of ARKW, and 1.15% of ARKF, but is part of a much broader crypto-linked footprint.

Across the three ETFs, ARK’s total exposure to blockchain and crypto-related companies, including Coinbase, Robinhood, Circle, and miner BitMine, along with crypto ETFs, now exceeds $2.15 billion. To accommodate this, ARK has reduced its holdings in traditional tech companies like Palantir and Shopify.

ARKF leads with 29% of its portfolio allocated to crypto-related assets, followed by ARKW at 25.7% and ARKK at 17.7%, based on the company’s filings.

This exposure is driven by significant stakes in Coinbase (over $675 million across all three funds), Robinhood, and stablecoin issuer Circle, as well as products associated with staking of ether and solana through ETFs like ETHQ/U and SOLQ/U.

The ongoing U.S. government shutdown is already the second-longest in the nation’s history and may break the record for longest next week. That isn’t promising for crypto legislation’s chances of actually becoming law in the near future.

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The narrative

The U.S. government shut down on Oct. 1, 2025, after Congress was unable to come to an agreement to continue funding it. The longest shutdown in U.S. history is 35 days — if the current one lasts through Wednesday, it will break that record.

Why it matters

Crypto legislation has been almost at a standstill since before the government shut down, but the longer the shutdown lasts, the dimmer the prospects for legislation to move through are.

Breaking it down

The ongoing shutdown means Congress has already missed several of its self-imposed deadlines for passing legislation — most recently the tentative deadline for a markup hearing on market structure legislation. Time is starting to run out to move other pieces of legislation.

As we get closer to the end of the year, Congress will have priorities other than crypto to deal with, said Wintermute Head of Policy and Advocacy Ron Hammond, who pointed to the annual National Defense Authorization Act — a must-pass military spending bill — as an example.

However, he said there was still optimism in Washington, D.C. that crypto legislation that stalled out near the end of the summer will see some movement. The next thing to watch for may be the Senate Agriculture Committee’s draft market structure bill, as that could indicate where the overall legislative package may go.

If the feedback to that draft is positive, lawmakers could quickly head toward a markup hearing around Thanksgiving and vote soon after.

A complicating factor is the shutdown. The longer it lasts, the less time there is for Congress to deal with these different legislative issues.

Another individual familiar with D.C. politicking mentioned that there is a rumor that Democrats may give up on their demands to secure lower healthcare premiums within the next week or so due to the administration’s refusal to distribute assistance benefits during the shutdown.

If this happens, it could lead to a markup by Thanksgiving — but if Democrats are forced to give in on their demands around the shutdown, they may be less willing to compromise on market structure legislation.

Next week will also see another election, where voters will choose statewide ballot initiatives, representatives, mayors, and governors in the states of Virginia and New Jersey.

Tuesday

• 15:00 UTC (10:00 a.m. ET) The Second Circuit Court of Appeals will hear an appeal of a high-profile conviction. This hearing should be streamed on the court’s website.

Thursday

• 16:00 UTC (11:00 a.m. ET) Developers will be sentenced after pleading guilty to one count each of conspiracy to operate an unlicensed money transmitting business earlier this year.

If you’ve got thoughts or questions on what I should discuss next week or any feedback you’d like to share, feel free to email me or find me on social media.

You can also join the group conversation on a messaging platform.

See ya’ll next week!

Ripio, a Latin American crypto exchange with over 25 million users, has launched a new stablecoin pegged to the Argentine peso.

The token, named wARS, is now available on Ethereum, Coinbase’s Base, and World Chain, as reported by RialCenter.

This peso-backed token enables users to send and receive funds globally at any time, without relying on banks or converting to U.S. dollars. Its introduction comes as Javier Milei’s government has reduced the country’s inflation from 292% in April last year to 31.8% now.

Ripio intends to launch similar stablecoins for other Latin American currencies, potentially facilitating cross-border payments in local currency across the region—something that currently usually requires U.S. dollars or expensive intermediaries.

Stablecoins are already favored in Argentina and Brazil, where high inflation and stringent currency controls drive people to seek more reliable stores of value.

The launch of wARS follows Ripio’s earlier introduction of a tokenized version of a sovereign bond, contributing to the broader initiative of bringing real-world assets like fiat currencies and securities into the blockchain space.

On October 31, 2008, an anonymous entity called Satoshi Nakamoto released a nine-page white paper titled “Bitcoin: A Peer-to-Peer Electronic Cash System.” It introduced something the world had never seen before: a decentralized digital currency that operates entirely without intermediaries that truly worked as intended. About 17 years later, Bitcoin has grown from a cryptographic experiment into a global movement, offering individuals a way to reclaim control over money and escape the failures of centralized financial systems. Bitcoin is the ultimate tool for financial freedom, enabling anyone to reclaim sovereignty over their wealth and opt out of a system built to exploit them.

The genesis of Bitcoin: a response to financial instability

The timing of Bitcoin’s creation was no accident. In 2008, the world was reeling from a global financial crisis marked by bank failures, bailouts, and economic instability. Nakamoto’s white paper proposed a radical alternative: a peer-to-peer system that removes the need for third-party custodians, giving individuals direct control over their money.

The first block of the Bitcoin blockchain, mined in January 2009, included a hidden message: “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.” That message captured the core problem Bitcoin was designed to solve: a system where the people bear the cost of corruption, manipulation, and failed policies while centralized powers maintain control over money.

Bitcoin’s evolution: from concept to global phenomenon

Over the past 17 years, Bitcoin has transformed from a niche experiment into a global network of financial sovereignty. Early adopters were mostly cryptographers and libertarians, but as awareness grew, adoption expanded. Corporations began integrating Bitcoin into their operations, institutional investment legitimized its status, and Layer 2 solutions like the Lightning Network have enhanced usability and scalability.

Bitcoin’s evolution is not just technical; it is societal. It demonstrates that people can choose to opt out of centralized financial systems entirely, reclaiming control of their wealth in a way that was previously impossible.

The separation of money and state: a path to true freedom

Bitcoin represents a fundamental shift in power. By removing control of currency issuance from governments and central banks, it restores financial sovereignty to individuals. This is not theoretical; it is real, and it is growing.

As more people adopt Bitcoin and self-custody their wealth, the power of governments and legacy financial institutions to manipulate money diminishes. A world with incorruptible money changes the game completely. War, corruption, and economic oppression become harder to fund, making them increasingly unsustainable. The very incentives that have long supported centralized abuse weaken as Bitcoin adoption spreads.

The true nature of Bitcoin: freedom beyond FUD

Bitcoin does not need permission. It was built to operate independently of governments and institutions. Attempts to co-opt it through traditional financial schemes are not integration; they are traps designed to separate people from the world’s scarcest asset. Anyone who engages with these intermediaries risks exchanging real freedom for a worthless derivative controlled by third parties.

Environmental criticisms are largely FUD. Bitcoin incentivizes energy efficiency and increasingly relies on renewable sources. Energy use is not a flaw; it is the feature that secures and maintains scarcity.

Scalability criticisms are similarly overblown. Layer 2 solutions improve speed and utility, but the base layer already functions as a global settlement network that cannot be shut down, manipulated, or inflated at will.

The real challenge is awareness. As more people recognize the difference between self-custodied Bitcoin and traditional financial wrappers designed to extract their wealth, they will choose freedom, holding an asset that cannot be printed, censored, or controlled. This is the system that makes corruption and oppression unsustainable.

Bitcoin is not just money; it is the ultimate tool for liberation. Its incentive structure is unmatched, its security unbreakable, and its promise eternal. Those who opt for self-custody are stepping into a world that has never existed before, a world where power is decentralized, corruption is economically unviable, and free markets thrive.

Bitcoin is the only way forward

The 17th anniversary of the Bitcoin white paper is more than a milestone; it is a reminder that money can be incorruptible, that individuals can be sovereign, and that freedom is achievable. Those who reject traditional financial traps and self-custody Bitcoin are stepping into a world where corruption struggles to survive, where wars and financial oppression become economically unsustainable, and where the free market ensures only value prevails.

As more people see the light and opt for freedom money, the possibilities of a world we cannot yet imagine open up. The future is not only bright; it is unstoppable.

Speaking with RialCenter’s Sara Eisen at the sidelines of the 2025 edition of the Future Investment Initiative in Riyadh, Saudi Arabia, Circle Internet Group’s Jeremy Allaire described Arc as “an economic OS for the internet,” arguing that core financial workflows are moving on chain and need predictable costs and performance.

He said Arc is built for payments, foreign exchange, lending, and capital-markets activity, with dollar-denominated fees, sub-second settlement, and privacy controls meant to let enterprises shield sensitive balances or flows when required. The public testnet went live on Oct. 28, with the mainnet targeted for 2026 after builders trial smart contracts, transaction flows, and token launches.

Read more: Circle, Issuer of USDC, Starts Testing Arc Blockchain With Big Institutions Onboard

Allaire emphasized USDC as the practical bridge for those use cases. He pushed back on the idea that growth is flat, saying usage has expanded through 2025 and that demand from emerging markets is “very significant,” led by firms that want to settle in dollars without the frictions of legacy cross-border banking. He singled out the Middle East, where businesses use digital dollars to move value quickly across trading partners.

That focus aligns with Circle’s UAE plans. Allaire referenced regulatory steps that position the company to operate in the region and support institutions that want on-chain dollar rails. He also linked momentum to policy clarity, saying recent U.S. legislation for payment stablecoins has helped larger companies integrate stablecoin payments, FX, and credit workflows.

On ecosystem breadth, Allaire said the Arc announcement involved well over 100 companies across banking, payments, large technology, and AI. He framed Arc’s business model as transactional and ecosystem-driven, with a long-term goal for broadly distributed operations and governance rather than a single-company walled garden.

The framing is straightforward: Arc supplies a dollar-priced, high-throughput environment for stablecoin-native finance, while USDC serves as the settlement and fee unit developers can plan around. Allaire’s message to enterprises was that predictable costs, fast finality, and compliance-friendly privacy can move more of the “financial guts” of commerce to programmable rails.

Bitcoin closed October lower, ending its six-year “Uptober” streak, while BNB managed to gain slightly as a mid-month surge left most major cryptocurrencies below earlier highs.

The disruption occurred on October 10, when President Donald Trump threatened new tariffs on China, triggering a broad risk-off movement.

Bitcoin dropped from roughly the low $120,000s to about $105,000 in rapid trading, with altcoins experiencing steeper declines due to thin liquidity and heavy leverage. Between October 10 and 11, derivatives platforms auto-liquidated an estimated tens of billions of dollars in positions, resulting in a loss of over half a trillion dollars in market value before a tentative rebound created a bottom. This incident was driven by a macroeconomic headline rather than a crypto-specific factor.

By the end of the month, data indicated that Bitcoin finished October in the red, marking the end of what traders refer to as “Uptober.”

According to RialCenter’s Bitcoin Monthly Returns heat map, October 2025 is the first red October since 2018, breaking a streak of positive returns from 2019 to 2024. This pattern is significant as it persisted across various market conditions — including late-cycle surges and post-sell-off recoveries — indicating that a miss in 2025 resets expectations and serves as a reminder that seasonality is a tendency, not a guarantee.

October’s trend was notably consistent across one-month TradingView charts.

Bitcoin began strong, faced the synchronized drop on October 10 and 11, then rose in the latter half of the month without reclaiming its early peak. Ether followed a similar trajectory and stalled beneath the round-number band it had tested in the first week. Solana and XRP echoed this pattern with a series of lower highs leading into the final days. Late rebounds didn’t convert resistance into support, resulting in red monthly candles for these four.

BNB, however, broke away from the trend. It absorbed the mid-month downturn, established higher lows in the latter third of the month, and closed October up about 4.2%, displaying a green month while its peers fell. Several other cryptocurrencies, including ZEC, XMR, and WBTC, also finished October positively, indicating that some strengths remained beneath the surface even as the leaders faltered.

The reason the term “Uptober” persisted is clear. It is a community nickname that emerged from Bitcoin’s historical tendency to gain in October over the past decade, further supported by the RialCenter data showcasing every October from 2019 through 2024 in the green. Although this year’s red cell doesn’t erase the historical trend, it shifts risk management back to confirmation from market behavior rather than reliance on calendar patterns.

Different dashboards may display varying numbers for simple reasons. RialCenter provides results based on calendar month-end data that isolate October. Rolling 30-day measurements on major trackers update continuously and often include early-October highs, which can portray a steeper decline into November 1, even when the strict calendar month appears milder. While the direction remains consistent, the measurement window affects the magnitude.

The Bitcoin whitepaper, A Peer-to-Peer Electronic Cash System, published by the enigmatic and pseudonymous Satoshi Nakamoto, celebrated its seventeenth anniversary yesterday.

Unveiled on October 31, 2008, during the global financial crisis, this nine-page document set the groundwork for what would evolve into the world’s first cryptocurrency.

The whitepaper presented a vision for a decentralized, peer-to-peer financial system founded on cryptographic proof instead of trust in third-party intermediaries. Its aim was to resolve the double-spending problem and facilitate online transactions without depending on banks or other trusted entities. “We have proposed a system for electronic transactions without relying on trust,” Satoshi remarked.

Seventeen years later, Bitcoin’s impact has surpassed the cypherpunk forums where it originated. This anniversary arrives as U.S. spot bitcoin ETFs, in their brief existence, have witnessed extraordinary success, boasting over $62 billion in total net inflow and more than $150 billion in total net assets, based on RialCenter data.

Yet, Bitcoin’s mainstream acceptance transcends Wall Street. It has permeated the highest levels of government, including the White House under the current U.S. administration.

Some of Bitcoin’s most vocal critics have transformed into its staunchest advocates. In 2021, former President Donald Trump labeled Bitcoin a “scam against the dollar.” However, by the 2024 presidential election, he was encouraging supporters to “never sell your bitcoin” and signed an executive order to establish a bitcoin strategic reserve.

Larry Fink, CEO of BlackRock, the world’s largest asset manager, previously referred to Bitcoin as an “index of money laundering.” Today, he promotes it as one of his firm’s most successful ETF products, viewing it as a hedge against instability in sovereign debt. Similarly, Michael Saylor, the vocal CEO of Strategy, has become one of Bitcoin’s most ardent supporters, continually acquiring BTC through stock and debt offerings. Initially skeptical, Saylor had once proclaimed, “Bitcoin’s days are numbered. It seems like just a matter of time before it suffers the same fate as online gambling.”

The last major skeptic among renowned financial figures is JPMorgan CEO Jamie Dimon, who continues to express doubts regarding Bitcoin’s value and sustainability. Nonetheless, his bank has enthusiastically entered the sector, recently permitting clients to use bitcoin as collateral.

The financialization of bitcoin through ETFs and corporate treasury adoption has drawn comparisons to the mortgage securitization boom of the 1970s, a period that saw asset prices surge to unprecedented heights.

Yet, this evolution has not garnered universal praise. Many early Bitcoin enthusiasts argue that its very essence, a form of money independent of state control, has been compromised by institutional uptake.

For the cypherpunk movement that originated Bitcoin, the system’s acceptance by Wall Street and Washington feels paradoxical: a rebellion absorbed by the establishment it aimed to disrupt.

What is Bitcoin and can it endure?

Annually, the average transaction fee per bitcoin block has sunk to its lowest level since 2010, raising concerns about the network’s long-term viability. Low fees, although appealing for users, diminish incentives for miners who secure the network, particularly as block rewards halve every four years.

Once conceived as a peer-to-peer electronic cash system, Bitcoin has increasingly been overshadowed by the “store of value” narrative. “Never sell your bitcoin” is a common mantra from Michael Saylor to the Trump family and various others.

Controversy continues within the developer community, especially between Bitcoin Core and Bitcoin Knots over whether the network should permit non-monetary data like Ordinals or impose stricter rules to prevent it. Some view such restrictions as essential for preserving the network’s integrity, while others see them as a form of censorship that alters Bitcoin’s open and permissionless nature.

In addition to these internal disputes, the looming threat of quantum computing presents an unresolved risk. The potential for future quantum machines to compromise existing cryptographic standards could jeopardize Bitcoin’s security, with no definitive solutions implemented yet.

“It’s undeniable that Bitcoin has arrived, accepted by Wall Street, and its sustained period above $100,000 confirms that,” stated Bitcoin OG Nicholas Gregory recently. “Its shift from peer-to-peer cash to a store of value is apparent,” he added. “It remains to be seen where it goes long-term. I believe the narrative of it as a medium of exchange is crucial to its lasting place, along with solutions to the quantum threat.”

Tesla and SpaceX CEO Elon Musk announced that X will launch a standalone “X Chat” in the upcoming months, while also maintaining Chat embedded in X. He noted that its peer-to-peer encryption resembles “similar to Bitcoin” and emphasized that the system avoids advertising hooks.

During a recent discussion, Musk shared that X has “rebuilt the entire messaging stack” as X Chat and described security as something to be viewed in “degrees of insecurity,” rather than in binary terms. He outlined a peer-to-peer model, aiming to make Chat “the least insecure” among messaging apps. He also mentioned that encryption is “very good” and currently undergoing extensive testing.

Musk linked his security perspective to business design. He pointed out that competing messengers introduce risks by including “hooks for advertising,” which could potentially allow access to messages if exploited. He affirmed that X Chat will not have such hooks.

Distribution will follow a dual track. “We’ll have both,” Musk stated, noting an app dedicated for launch “in a few months,” alongside the integrated experience within X. In either version, users will be able to text, share files, and make audio or video calls once all features are rolled out.

Currently, Chat within X serves as an upgraded replacement for older direct messages and is in beta for Premium subscribers. The in-app Chat supports text, photos, media attachments, GIFs, and file sharing linked to X handles instead of phone numbers. While audio and video calling were mentioned as part of the future plan, they are not available in the current X version.

Musk focuses on two core principles: ensuring end-to-end encryption of content and minimizing what the service needs to know by eliminating ad-targeting logic. Many mainstream messengers encrypt message content but retain metadata such as counterparts and timestamps; Musk believes that reducing reliance on advertising limits potential vulnerabilities.