Uncategorized

Crypto for Advisors: The Growth of Stablecoins

Published

5 месяцев ago

23 января, 2025

admin

In today’s issue, Alec Beckman from Advantage Blockchain explains stablecoins and their growing use cases for institutions and advisors.

Then, CK Zheng from ZX Squared Capital shares tips on preparing for tax season in Ask and Expert.

— Sarah Morton

You’re reading Crypto for Advisors, CoinDesk’s weekly newsletter that unpacks digital assets for financial advisors. Subscribe here to get it every Thursday.

Stablecoin Use Case for Advisors

One of the primary hurdles for blockchain adoption to date has been utility, especially when looking through the lens of financial advisors and how these public blockchains and decentralized finance (DeFi) protocols can impact their clients.

Stablecoins — digital currencies pegged to stable assets like the U.S. dollar — have emerged as a powerful tool for modernizing savings, payments, and settlement processes. These innovations present a significant opportunity for advisors to enhance the value they offer to clients while staying ahead of market trends.

How can advisors leverage stablecoins to streamline operations, reduce costs, and provide cutting-edge financial solutions? Here’s how stablecoins can become a transformative tool for your clients:

Savings account / going bankless

Financial Inclusion: Stablecoins provide a way for clients to store value outside of traditional banking systems, granting access to financial services for the unbanked or underbanked. Anyone with an internet connection can use stablecoins.

Stability: Unlike volatile cryptocurrencies, full-reserve, dollar-backed stablecoins maintain a consistent value (ex. USDC is tied to the value of $1).

Liquidity & Accessibility: Funds in stablecoins are globally accessible 24/7, offering liquidity without dependence on conventional banking hours.

Better Yield: Using on-chain finance, stablecoins can generate significantly more yield than a savings account (Ex. Coinbase offers slightly over 4% APY, beating traditional savings accounts).

Self Custody: Many people, including myself, have been held up by a third-party custodian or bank. If someone can keep you from spending/sending money, it is not your money. The ability to self custody your own assets provides a more seamless way of transacting your own funds.

Payments

Efficiency: Transactions using stablecoins are fast and cost-effective with no global restrictions, relevant for those sending payments domestically or cross-border.

Value Retention: The stability of these digital assets ensures that the amount sent is equal to the amount received.

Adoption by Institutions: Financial institutions are recognizing stablecoins as a complementary payment system, signaling growing mainstream acceptance.

Adoption by Commerce: Stablecoins are less costly and more efficient than credit card payments for merchants.

Settlement

Instantaneous Transactions: Settlements via stablecoins are near instantaneous, improving liquidity and reducing counterparty risks for clients managing high-value transactions.

Lower Costs: By eliminating traditional clearing and settlement processes, stablecoins significantly reduce fees.

Global Versatility: Whether your clients are trading internationally or managing investments across borders, stablecoins streamline and simplify the settlement process.

Real-world application: SpaceX’s strategic use of stablecoins

SpaceX uses stablecoins to manage foreign exchange (FX) risks from its global Starlink operations. SpaceX shields itself from FX volatility by collecting payments in various currencies and converting them into stablecoins. The stablecoins, pegged to the U.S. dollar, provide a stable intermediary before being converted back to dollars.

This approach offers several advantages:

Reduced Currency Risk

Enhanced Efficiency

Liquidity Preservation

This strategy demonstrates how stablecoins can be a powerful tool for multinational corporations and can be applied to managing client portfolios.

Why This Matters to You and Your Clients For financial advisors, stablecoins can elevate portfolios and modernize financial strategies. These assets aren’t just a novelty — they’re a bridge to a more inclusive, efficient, and adaptable financial future. By integrating stablecoins into conversations about savings, payments, or settlements, you position yourself as a forward-thinking advisor prepared to navigate these changes.

— Alec Beckman, president, Advantage Blockchain

Ask an Expert

Q: What’s the 101 on stablecoins and liquidity?

The stablecoin market cap has reached a record $215 billion, predominantly concentrated in the two coins Tether and USDC, having a combined 85% of the market cap. The liquidity of the stablecoin market stays healthy as more stablecoin issuers such as Visa, Stripe, and PayPal enter this unique digital asset sub-class. Given the new Trump administration’s pro-crypto attitude, we expect more crypto-friendly rules and regulations for this asset in the coming months, which will support the further growth of the stablecoin market.

Q: Are stablecoins risky compared to traditional finance (TradFi)?

Stablecoins are typically designed to stay pegged to the U.S. dollar (though they don’t need to be). The functionality of stablecoins in the crypto market is comparable to money market funds in the traditional financial market. The money market funds have reached a $10 trillion market cap, which serves the purpose of short-term investment and a place to park money. Stablecoins will serve a similar purpose in the digital asset space. The quality and liquidity of the issuer’s holdings of fiat-denominated short-term assets are some of the critical risks associated with stablecoins, especially when the financial market is under great stress.

Q: Do country borders matter when it comes to stablecoins?

Country borders matter greatly as different countries may have different rules, regulations and license requirements for the stablecoin market. One of the key regulatory requirements associated with stablecoins is around the stability, liquidity, disclosure and transparency of the short-term assets the issuers hold for the underlying stablecoins.

— CK Zheng, co-founder & CIO, ZX Squared Capital

Keep Reading

Bitcoin reached a new all-time high Monday morning in anticipation of President Trump’s inauguration.

The $Trump and $Melania meme coins explained.

The U.S. Securities and Exchange Commission announced a crypto task force to focus on clear regulatory guidelines.

Uncategorized

Litecoin Slips Below $86 as Resistance Holds; Traders Watch Bitcoin Dominance

Published

23 минуты ago

30 июня, 2025

admin

Litecoin (LTC) tried to punch above $88 during Monday’s trading session, but met a wall of sell orders near that level.

The token has since retreated to $85.21, down 3.17% since the session’s peak and 1.5% in the last 24-hour period. That stumble erased the week’s slim gains and set a new line in the sand for bulls.

The drop came at a time in which bitcoin (BTC) has been its dominance increase, while its volatility dropped below the 40 mark in a potential sign of incoming action.

Technical Analysis Overview

Litecoin’s price swung significantly in the last 24-hour period, covering a $3.05 range, or roughly 3.5%. The token encountered stiff resistance between $88.00 and $88.42, where sellers stepped in heavily, particularly during late evening trading hours, according to CoinDesk Research’s technical analysis data model.

After peaking, LTC reversed lower and found new support at $85.37. The steepest drop was accompanied by the session’s highest trading volume of over 180,000 tokens, signaling strong bearish sentiment.

Short-term trading saw additional volatility. In the last few hours of trading, LTC spiked from $85.65 to $86.05, a 0.47% jump, on a burst of buying. But momentum quickly reversed, sending prices back down to $85.53 on another volume spike.

This cemented resistance near $86.05 and reinforced the new support level at $85.37, leaving Litecoin at $85.42 as the session ended. Traders are watching these levels closely for clues on whether the asset will stage a recovery or slip lower in the days ahead.

Uncategorized

Industry’s PAC Keeps Seeking to Add Allies as Congress Hashes Out Crypto Legislation

Published

53 минуты ago

30 июня, 2025

admin

The crypto industry’s political-finance arm, the towering campaign-funding entity known as Fairshake, dropped another $1 million into the coffers of a special-election candidate hoping to replace a Virginia Democrat who died in office, Representative Gerald Connolly.

The candidate favored by the industry’s chief political action committee, James Walkinshaw, won the Democrats’ so-called firehouse primary over the weekend, in which the party conducted its own polling to determine its chosen candidate among a field of nine. The general election to formally select the Fairfax County region’s next member of Congress is set for Sept. 9, though the Democrat incumbent took about two thirds of the vote in the regular election last year, giving Walkinshaw a heavy advantage.

«We look forward to James joining the growing, bipartisan coalition in Congress that understands the importance of securing America’s leadership in the next generation of technology,» said Josh Vlasto, a Fairshake spokesman, in a statement. He argued that the race again demonstrated that the electorate isn’t moved by critics who attempt to tarnish candidates who show support for the sector and are backed by its campaign resources, as at least one of Walkinshaw’s opponents sought to do.

Fairshake (and its affiliate super PACs, Defend American Jobs and Protect Progress) rose into prominence in the 2024 congressional elections as it amassed a huge war chest from major digital assets businesses, including Coinbase, Ripple and a16z. It devoted its campaign spending in outsized chunks that in some cases dwarfed what was spent by the opponents of the group’s chosen candidates. As a result, Fairshake added a long list of winners to the ranks of Congress’ crypto supporters in those elections, but it has continued its strategy in special elections as one-off contests seek to fill vacated seats such as Connolly’s.

In the case of Walkinshaw, Connolly’s former chief of staff, the spending came from Protect Progress, which focuses on Democrat candidates. While his former boss had voted routinely against crypto issues, Walkinshaw’s campaign site says the candidate favors an «embrace of the next generation of technology,» including blockchain, which the campaign said «can reduce administrative costs for businesses and lower fees for consumers.»

«Congress should establish modern, risk-based regulatory frameworks that support responsible innovation and prevent abuse,» according to Walkinshaw’s website.

The super PAC still has about $116 million on hand as the 2026 congressional election cycle approaches next year, Vlasto said. Current members of Congress it supported in the past round are already at work on major crypto bills that have been advancing this year.

Fairshake makes massive «independent expenditures» in political races, meaning their outside money buys advertising without approval or communication from the candidate. Though it represents crypto interests, the advertising purchased by the group almost never mentions the topic of digital assets, instead focusing on whatever political points are most likely to garner a win.

Uncategorized

XRPL EVM Sidechain Goes Live, Unlocking Ethereum Dapps in XRP Ecosystem

Published

59 минут ago

30 июня, 2025

admin

Ripple officially introduced the XRP Ledger’s Ethereum Virtual Machine (EVM) sidechain to the mainnet in an bid to improve the ecosystem’s interoperability and allow developers to deploy their Ethereum-based decentralized applications (dapps) with the XRPL.

The development adds EVM-compatible smart contracts while maintaining a connection to the XRPL, giving developers access to the ecosystem at a low cost, Ripple said in a blog post. It is designed to eliminate the trade-off between EVM compatibility and XRPL’s own advantages, opening the door for dapps to lean into XRP’s payments infrastructure.

“The XRPL EVM Sidechain introduces a flexible environment for developers to deploy EVM-based applications, while maintaining a connection to the XRPL’s efficiency,” David Schwartz, Ripple’s chief technology officer and a co-creater of XRPL, said in the post. “It extends the capabilities of the ecosystem without changing the fundamentals that make the XRPL reliable.”

The sidechain operates as a separate blockchain that is parallel and connected to the XRP Ledger over the Axelar bridge, an interoperability protocol. XRPL’s native token, XRP (XRP), will serve as the native gas token for the sidechain.

The chain is designed specifically for developers, as they can now build and deploy their EVM-based applications, while accessing XRPL’s network of over 6 million wallet holders, Ripple said. The sidechain is planned to eventually also integrate with Wormhole, another interoperability protocol, allowing even more developers to access the XRP ecosystem.