This week’s theme: Stablecoins are quietly shaking the foundations of traditional banking.

The Federal Reserve’s new proposal for a “Skinny Master Account” marks the first time non‑bank institutions could gain direct access to the Fed’s clearing system. If fintechs can plug straight into the Fed, the ceiling for financial innovation moves dramatically higher. What might that do to the future shape of the fintech landscape?

Fintech players are already moving fast. Wise is preparing a stablecoin wallet for its 16 million users. Revolut, now holding both CASP and EMI licenses under MiCA, is building a full‑stack loop from custody to issuance across Europe. As these platforms—each serving tens of millions—absorb digital assets into everyday interfaces, how will the average consumer’s relationship with money evolve?

When payments no longer rely on banks, the erosion isn’t just in transaction fees; it’s in deposits and trust. The traditional banking model starts to wobble. The question isn’t whether banks will change—but what kind of institutions they will become when stablecoins turn from edge experiment to core infrastructure.

Market Overview & Growth Highlights

Total stablecoin market cap reached $308.195b, with a week-over-week increase of $1.016b. In terms of market structure, USDT continues to maintain its dominant position at 59.31%; USDC ranks second with a market cap of $76.027b, accounting for 24.67%.

Blockchain Network Distribution

Top 3 Networks by Stablecoin Market Cap:

1. Ethereum: $162.311b

2. Tron: $79.001b

3. Solana: $14.89b

Top 3 Networks by Weekly Growth:

1. Frax (FRAX) : +20.92%

2. Sky Dollar (USDS) ：+15.44%

3. Circle USYC (USYC) ：+12.76%

Data from DefiLlama

🎯When Startups Can Plug Directly Into the Fed — Rethinking the Edges of Payment Innovation

What happens when non‑bank companies can hold their own Fed accounts? When stablecoin issuers no longer rely on banks, what kind of financial institutions emerge? Those questions sit beneath a quiet but profound policy shift taking shape at the Federal Reserve.

At the first Payments Innovation Conference, Fed Governor Christopher J. Waller floated the idea of a “Skinny Master Account.” It would give regulated non‑bank payment firms limited access to the Fed’s balance sheet—enough to settle funds, but not enough to act like banks. No interest, no overdraft, no discount window. Just a narrow clearing channel between private money and the ultimate ledger of trust.

For more than a century, payments have been a by‑product of banking. Under fractional‑reserve money, every transaction was really an accounting dance between bank liabilities; to move funds, you had to move inside the system. Stablecoins cracked that logic. Backed one‑for‑one by liquid assets, they offered instant settlement without bank credit. In doing so, they separated the logistics of moving money from the business of creating it: custody, payments, and lending could become distinct layers again.

Waller’s proposal is, in a sense, the institutional recognition of that shift. The Skinny Account gives “narrow‑banking” models an official home—firms that don’t issue credit or take maturity risk but can still hold and transfer money securely within the Fed’s rails. It signals a willingness to let market players handle payment innovation while the central bank maintains the integrity of settlement itself.

If the OCC’s national‑trust charters resolved the legal chaos of state‑by‑state MTL licensing, the Fed’s Skinny Account tackles the operational limit: direct Fed access without a banking charter. For firms like Circle or Paxos, that means faster approvals, clearer oversight, and the ability to settle without an intermediary bank. Two institutional frictions—legal and infrastructural—begin to dissolve.

The implications are significant. Fintech has long lived “above” banks: building smoother on‑ramps and compliance layers while depending on traditional institutions for settlement. Stripe, for instance, transformed merchant payments but still clears through commercial banks. A Skinny Account flattens that hierarchy. Qualified non‑banks could clear directly on the Fed’s ledger, bypass correspondent networks, and reduce costs while gaining final‑settlement certainty. For the first time, private‑sector innovation would grow natively inside the central‑bank system—AI‑driven payment protocols and stablecoin reserves operating on the same base layer of public money.

That symmetry will inevitably erode banks’ payment earnings. Analysts estimate that as much as $1 trillion in global deposits could migrate into stablecoins over the next few years, with as much as $6 trillion of that in the U.S. Even a 10% shift could lift bank funding costs by 20–30 bps and tighten margins. Yet banks still retain a scarce privilege: the license to create credit and engage in capital‑market activity. In the post‑payment world, their focus will move up the stack—lending, underwriting, risk pricing, custody—while settlement itself becomes a neutral, public utility.

The deeper story is structural. The Fed’s new proposal doesn’t just modernize plumbing; it redraws the boundary between state money and private networks. Once payments decouple from credit, innovation can scale without leverage, and central‑bank trust becomes the substrate for competition rather than its constraint. In that sense, the Skinny Master Account isn’t a small policy tweak—it’s the blueprint for a thinner, faster, more open financial architecture.

🎯Europe’s Stablecoin Moment: How MiCA Is Rewriting the Rules of Fintech Regulation

So far, the story of stablecoins has been a story about the dollar. In both regulation and market practice, the United States holds a commanding lead. Its unified federal system makes it the only jurisdiction offering a truly “nationwide compliance channel” and, soon, direct access to central bank infrastructure. The advantage runs deep: the Genius Act established the first federal framework for dollar‑backed tokens; the OCC trust charter gave firms like Circle and Paxos a uniform regulatory identity, freeing them from the patchwork of state MTL licenses; and the Fed’s proposed “Skinny Master Account” would, once implemented, allow qualified non‑banks to settle directly on the Fed’s network—removing one of the last structural ceilings on private‑sector innovation. The outcome is hard to miss: roughly 99 percent of all stablecoins are denominated in U.S. dollars. Regulatory certainty has become America’s hidden moat—and the starting line for everyone else.

Now Europe is moving to catch up, and the shift is finally visible on the ground. Since the Markets in Crypto‑Assets Regulation (MiCA) came into force at the end of 2024, a wave of fintech firms have begun applying for licenses under the EU’s single framework. MiCA collapses the fragmented national VASP regimes into a bloc‑wide CASP (Crypto‑Asset Service Provider) system, pulling all crypto activity under one authorization. The structure works in two tiers: the CASP license allows firms to legally offer and market crypto‑asset services across the European Union, including custody, trading, order execution, and advisory services; the EMI (Electronic Money Institution) license governs e‑money and stablecoin issuance, reserves, and governance. For companies seeking a full “custody‑to‑issuance” model in Europe, the combination—CASP + EMI—is quickly becoming the entry ticket.

Blockchain infrastructure firm Plasma is pursuing both licenses under MiCA, aiming to build a “full‑stack payments platform” anchored on stablecoin settlement. Having acquired an Italian VASP entity, the company is now building a three‑layer compliance path—from VASP to CASP to EMI—supporting cross‑border payments and business accounts with stablecoins at the core.Digital bank Revolut is following a more bank‑like route: on top of its Lithuanian EMI license, it has secured a MiCA license from Cyprus regulators, allowing crypto trading, custody, and future stablecoin issuance across the EEA. According to people familiar with the matter, Revolut is developing a 1:1‑backed stablecoin that could launch as early as 2026—positioning it to become the first major digital bank to issue a stablecoin under Europe’s unified rulebook. For a $45 billion fintech serving 65 million users, that regulatory clarity doesn’t just mark compliance; it signals a template for how Europe’s fintechs can finally innovate within the law—and use structure, not speed, as their new competitive edge.

New Launches

👀French hardware wallet maker Ledger has launched a full product refresh with the Nano Gen5 “signer,” a redesigned Ledger Wallet app, and the Ledger Enterprise Multisig platform. Framed as a security layer for digital assets and identity in an AI-driven world, the Gen5 features Clear Signing, Bluetooth, and NFC, designed by Susan Kare and priced at $179 / €179. Ledger now defines its devices not as wallets but as instruments of proof, enabling verification and authority in digital interactions. Enterprise Multisig extends signing from individuals to organizations, reflecting how hardware security is becoming central to digital asset and identity management.

👀Coinbase has launched the Coinbase One Card for U.S. Coinbase One members, offering up to 4% Bitcoin rewards on purchases for an annual fee of $49.99. The card has no foreign transaction fees, and holders can pay balances via linked bank accounts or crypto funds on Coinbase. Earned Bitcoin rewards are not reported on Form 1099 until sold. The physical card features an etching of the Bitcoin Genesis Block created by Satoshi Nakamoto on January 3, 2009, reinforcing its Bitcoin-first identity. The launch highlights diverging strategies in the crypto rewards card market, as Gemini’s new Solana card targets multi-asset flexibility and no annual fee, while Coinbase focuses on Bitcoin purity and brand loyalty among committed crypto users.

👀Swiss crypto bank AMINA, regulated by FINMA and formerly known as SEBA Bank, has partnered with Apex Group’s blockchain platform Tokeny to build a regulated infrastructure for institutional asset tokenization. Under the partnership, AMINA will handle banking, custody, and regulatory oversight for traditional assets, while Tokeny provides the technology to tokenize them, enabling seamless movement between traditional accounts and blockchain systems. Tokeny’s platform, built on the ERC-3643 standard, embeds compliance controls that restrict holdings and transfers to authorized investors across assets such as government bonds, corporate securities, and treasury bills. The collaboration shortens tokenization timelines from months to weeks, creating a regulated “banking bridge” that connects traditional finance and blockchain-based markets, accelerating institutional adoption of tokenized assets within Switzerland’s regulated framework.

👀Coinbase has unveiled Payments MCP, a new Model Context Protocol that allows large language models such as Anthropic’s Claude and Google’s Gemini to go on‑chain, accessing wallets and transacting with digital assets. Built by the Coinbase Developer Platform and introduced after the x402 Foundation’s launch with Cloudflare, the system aims to standardize AI payments. Payments MCP lets AI models use the same blockchain financial tools as humans—from wallets and on‑ramps to stablecoin payments. Coinbase executives call crypto rails “the ideal payment infrastructure for agentic commerce,” running at “code speed” with minimal user friction and customizable local deployment for autonomous LLM agents.

👀Institutional liquidity provider B2C2 has launched PENNY, a zero-fee platform enabling instant cross-chain swaps between major stablecoins including USDT, USDC, USDG, RLUSD, PYUSD, and AUSD. The service currently supports Ethereum, Tron, Solana, and several Layer-2 networks, with more assets to be added. PENNY leverages B2C2’s institutional trading infrastructure—processing around $1 billion in stablecoin volume daily—to execute automatic, on-chain swaps without counterpart risk or transaction fees. As stablecoins expand beyond crypto trading into payments, banking, and settlements, B2C2 aims to provide traditional institutions with frictionless liquidity tools and real-time settlement.

👀Coinbase to add privacy transactions to its Base network — CEO Brian Armstrong announced that Coinbase is developing privacy‑enhancing transaction features for its Layer 2 network Base, with more details coming soon. The effort builds on Coinbase’s March 2025 acquisition of Iron Fish, whose team joined Base’s new privacy division to focus on “privacy‑preserving primitives.” The move comes as privacy coins like ZEC, XMR, and DASH surge amid renewed global attention, with ZEC up 460% in the past 30 days. Armstrong said “privacy is essential to unlocking the full potential of on‑chain finance,” underscoring Coinbase’s push to balance user confidentiality with regulatory compliance as mainstream crypto embraces enhanced privacy.

👀Tether has released a modular Wallet Development Kit (WDK) enabling developers to build self‑custodial wallets that support Bitcoin, Lightning, Ethereum, Arbitrum, Polygon, Solana, and TON. The toolkit runs on mobile, desktop, and embedded hardware, offering templates and modules for adding features like swaps and lending without relying on closed platforms. CEO Paolo Ardoino called it part of Tether’s vision for “a free and resilient monetary infrastructure” empowering “humans, autonomous machines, and AI agents to control their own finances.” The move advances Tether’s AI strategy, anticipating a future where every AI agent holds a wallet and machine‑to‑machine commerce runs on stablecoins and Bitcoin instead of traditional bank accounts.

Capital Deployment

💰Programmable bank Pave Bank has raised $39 million in Series A funding led by Accel, with participation from Tether Investments, Wintermute, Quona Capital, and Helios Digital Ventures. Licensed in Georgia, Pave Bank calls itself the first global “programmable bank” built for the digital asset and AI era, enabling corporate clients to manage fiat and crypto in real time and automate financial operations. The funding will support regulatory expansion, product development, and infrastructure growth. For Tether, whose stablecoin business generates substantial profits, the investment reflects a strategic move into programmable, full-reserve banking models that merge traditional finance with digital assets and could accelerate stablecoin adoption across regulated markets.

💰Aave Labs has acquired San Francisco–based startup Stable Finance, a company focused on simplifying on-chain savings for everyday users. Following the deal, Stable Finance founder Mario Baxter Cabrera and his engineering team have joined Aave Labs, with Cabrera becoming Director of Product. The acquisition advances Aave’s goal of turning “on-chain finance into everyday finance.” Stable’s mobile app—known for offering fiat and crypto deposits with stablecoin yield strategies—will be phased out as its technology integrates into future Aave products. This marks Aave’s third talent-focused acquisition after Sonar (2022) and Family (2023), signaling a continued push to make DeFi interfaces more consumer-friendly and expand stablecoin-based savings to mainstream users.

💰Salesforce‑backed Modern Treasury acquires Beam for $40 million . Modern Treasury will acquire Beam, a stablecoin infrastructure firm providing plug‑and‑play adoption tools for banks and enterprises, in an all‑stock deal valued at $40 million. The move follows a wider fintech trend of absorbing stablecoin talent and technology, echoing Stripe’s $1.1 billion acquisition of Bridge and its Tempo Layer 1 initiative. Beam founder Dan Mottice will lead Modern Treasury’s stablecoin division; Beam joined the Global Dollar Network this summer alongside Paxos and Robinhood to develop the USDG token. With the U.S. GENIUS Act now law and Circle’s NYSE listing, the deal positions Modern Treasury to compete with Stripe and Coinbase in programmable‑dollar payments and the rapidly growing stablecoin market.

💰Tempo, an Ethereum‑compatible Layer 1 blockchain optimized for high‑throughput payments and settlements, has closed a $500 million Series A led by Thrive Capital and Greenoaks, valuing the company at $5 billion. Incubated by Stripe and Paradigm, Tempo has already partnered with OpenAI, Shopify, and Visa. Ethereum core developer Dankrad Feist, co‑creator of Danksharding, joins as a senior engineer, underscoring how top blockchain talent is moving into payment infrastructure. The round signals Stripe’s deepening push into crypto, following its $1.1 billion acquisition of stablecoin‑infrastructure firm Bridge earlier this year.

💰Tether announced a strategic investment in Kotani Pay, a platform connecting African Web3 users with local payment rails to lower barriers for individuals and businesses to join the global financial system. According to Chainalysis, sub‑Saharan Africa saw over $205 billion in on‑chain crypto volume from July 2024 to June 2025, up 52%, driven by retail use and remittances. Growth is concentrated in Nigeria, Kenya, South Africa, and Ethiopia, where crypto helps counter inflation, currency volatility, and limited banking access. The partnership positions Tether and Kotani Pay to reduce costs and settlement times for cross‑border transactions, empowering millions to participate directly in the global economy.

Big Picture

🔮JPMorgan analysts say Stripe is positioning itself at the intersection of AI commerce and digital asset infrastructure, potentially unlocking a $350 billion market by 2030. The $107 billion fintech became profitable in 2024, processing over $1.4 trillion in payments across 195 countries, with net revenue rising 28% to $5.1 billion. Stripe re-entered crypto by acquiring Bridge and Privy and co-developing the Tempo Layer-1 blockchain with Paradigm, which raised $500 million at a $5 billion valuation. JPMorgan calls Stripe a key beneficiary of borderless finance, citing early traction with AI startups and growing exposure to agentic commerce, though expansion and regulatory risks under U.S. stablecoin and EU MiCA frameworks remain.

🔮Japan’s three largest banking groups—Mitsubishi UFJ, Sumitomo Mitsui, and Mizuho—plan to jointly launch a yen-backed stablecoin and create a shared framework for issuance and transfers among corporate clients, according to Nikkei. The project will start with a yen-pegged token and may later add a U.S. dollar version, operating under unified technical and legal standards for bank interoperability. Mitsubishi UFJ previously built the blockchain platform Progmat, already supported by major Japanese institutions. The initiative aligns with Europe’s multi-bank euro stablecoin efforts and reflects Japan’s strategy to establish a national digital payment standard amid a $300 billion market dominated by U.S. dollar stablecoins.

Market Adoption

🌱Zepz, the parent company of WorldRemit and Sendwave, has launched Sendwave Wallet, a USDC-based cross-border solution that allows users in more than 100 countries to send, store, and spend money seamlessly. Built on Solana and Portal infrastructure, the wallet maintains USD-pegged balances and offers near-instant, low-cost transfers. Users can already move funds within the Sendwave ecosystem in seconds and will soon be able to spend USDC via cards and QR codes. The launch marks Zepz’s evolution from a remittance provider to a full-service financial platform, offering global users stability, accessibility, and dignity through stablecoin-powered everyday payments.

🌱 Wise is recruiting a Head of Digital Assets to explore how customers can hold and use digital assets within their Wise accounts while maintaining the platform’s seamless fiat experience. The role aims to integrate stablecoins into Wise’s global ecosystem and monetize the receiving side by enabling in‑app balances to power savings, credit, and investment features. The move signals a broader fintech shift toward blockchain‑based customer lifecycles. For Wise’s 16 million users, digital‑asset support could extend its multi‑currency mission, bringing transparent, instant, and borderless money to the mainstream.

🌱U.S. retail chain Bealls, founded in 1915, has partnered with digital payments company Flexa to begin accepting cryptocurrency payments across its stores. By integrating the Flexa Payments system, Bealls can now accept over 99 cryptocurrencies from more than 300 digital wallets. With more than 660 locations nationwide, customers at Bealls, Bealls Florida, and Home Centric stores can now pay using crypto. The move underscores the growing acceptance of digital assets in traditional retail as roughly 65 million Americans—about 28% of adults—now own cryptocurrency, creating a substantial base for crypto-based payments.

Regulatory Compliance

🏛OCC Chief Jonathan Gould told the American Bankers Association Annual Conference that stablecoins are unlikely to trigger sudden deposit crises, saying any major outflows “wouldn’t go unnoticed or happen overnight.” While Standard Chartered projects stablecoins could draw $1 trillion in deposits from emerging‑market banks within three years, and a U.S. Treasury report warns of potential $6.6 trillion domestic outflows, Gould urged community banks to view stablecoins as competitive tools, not existential threats. Linking payment stablecoins, he added, could help them break Wall Street’s dominance in U.S. payments infrastructure.

🏛Coinbase CEO Brian Armstrong, Galaxy Digital CEO Mike Novogratz, and other crypto industry leaders met with pro-crypto Senate Democrats on Wednesday to discuss the digital asset market-structure bill, according to journalist Eleanor Terrett. The roundtable, led by Senator Kirsten Gillibrand, included Uniswap CEO Hayden Adams and Circle Chief Strategy Officer Dante Disparte, and took place amid stalled bipartisan negotiations. Analysts at TD Cowen noted that progress on the bill remains slow, with final passage likely delayed until after the midterm elections. Despite swift approval of the GENIUS Act, Democrats and Republicans remain divided over the bill’s approach to DeFi, and the Democratic six-page proposal has already drawn criticism from both GOP lawmakers and the crypto industry.

🏛The European Commission said on October 10 that it will not impose extra restrictions on stablecoin issuers, despite urgent financial‑stability warnings from the European Central Bank, marking a major win for firms like Circle. The dispute centers on whether tokens issued inside and outside the EU can be treated as interchangeable under “multi‑issuance” models, which risk regulators say could trigger runs on EU‑based reserves. The Commission stated that MiCA already provides a robust, proportionate framework addressing such concerns. The stance removes key uncertainty for Europe’s stablecoin market and preserves competitiveness versus the U.S., where new legislation is promoting stablecoin adoption.

🏛Senate Banking Committee Democrat Elizabeth Warren criticized the proposed GENIUS Act as a “light‑touch framework for crypto banks” in a letter to Treasury Secretary Scott Bessent. She highlighted potential conflicts of interest tied to the Trump family’s World Liberty Financial USD, one of the largest stablecoins, and demanded anti‑corruption safeguards. Citing Paxos’s accidental minting of 3 trillion PYUSD, Warren said the bill lacks protections to ensure stablecoins can’t “blow up the financial system.” Her warning aligns with Fed Governor Michael Barr’s recent comments as Congress begins drafting broader crypto regulation and Treasury faces pressure to strengthen consumer protection and stability measures.