As the stablecoin competition is heating up with looming regulation in the U.S., traditional finance institutions are taking notice—largely out of fear of losing out to digital dollars, said Ben Reynolds, BitGo’s managing director of stablecoins, at Consensus 2025 in Toronto.

Speaking at a panel discussion, he said that BitGo’s recently launched stablecoin-as-a-service has seen “incredible inbound” interest from U.S. and foreign banks wanting to tokenize deposits or issue stablecoins.

«A lot of banks are just being defensive—they’re afraid they’re going to lose their deposits,” Reynolds said. «They look at stablecoins and say: How do we not get left behind?»

Yield-bearing versions of stablecoins and tokenized money market funds have seen rapid growth recently, but still make up only a fraction of the $230 billion stablecoin market.

A16z’s Sam Broner said that while yield-bearing stablecoins are a promising market segment, their primary use case is for payments and transactions where users don’t really care about yields. Still, a near-term killer use case could be “collateral mobility”—the ability to instantly move money to meet obligations across different platforms.

«You can’t do a lot of things with a share of a money market fund,» Broner said. «You’ve got lock-up periods, business-hour settlement, and contracts that have to be manually reviewed. Crypto gives you programmatic, permissionless flexibility.»

Yield-bearing stablecoins could also be attractive for institutions, said Matt Kunke, crypto product strategist at BlackRock. «If you’re a DAO, protocol, or market maker, moving between crypto holdings on an exchange and your brokerage account is slow and full of friction,» he said. «Stablecoins that carry yield just reduce that drag.”

However, regulatory distinctions will shape the market. “A tokenized Treasury fund is a security, and an actual stablecoin is not,” he explained. “They deserve fundamentally different markets.»

Joseph Saldana, chief financial officer of the Wyoming Stable Token Commission, pointed out that yield–generating tokens have the power to broaden investors’ access compared to mutual funds that often have minimum limits of investment that «lock out a lot of people.»

«We want to service the underbanked and give broader access to instruments the rest of us enjoy every day,» Saldana said.

TORONTO — Despite a recent setback, U.S. President Donald Trump should be able to sign stablecoin and market structure legislation before Congress goes on break in August, said White House official Bo Hines on Wednesday.

Lawmakers are still discussing the legislation, which is good, said Hines, the executive director of the President’s Council of Advisers on Digital Assets, said on stage at Consensus 2025 in Toronto.

«Negotiations are ongoing,» he said. «But I remain steadfast in my optimism that we’re going to achieve — the President’s desire is to do it — but stablecoin legislation and market structure legislation before the August recess.»

Still, he acknowledged that the legislative process was «evolving.»

Hines said earlier in the day that Trump’s crypto ventures, as well as the president’s family’s tie-ups, did not pose any conflicts of interest.

«His sons have the right to engage in capital markets as private business people, like anyone else does in the U.S.,» he said on CoinDesk TV. «I don’t see any conflict in doing so. By the way, it should be exciting that they’re engaging in this space. If you’re a good business person, you should be looking at digital assets and saying, ‘how can I get involved?’ Because this is the next generation of finance.»

He repeated this argument on stage at Consensus.

«As we launch these tariff negotiations and trade negotiations play themselves out, we want to establish ourselves as a leader in digital asset financial technology more generally,» he said.

Asked on CDTV about reports that a small company was purchasing TRUMP coins, Hines said, «I’ll say very firmly, the president of the United States can’t be bought.»

The White House and members of its working group are still working on a strategic Bitcoin reserve, Hines said on stage.

Cantor Fitzgerald Chairman Brandon Lutnick personally verified Tether’s reserves when the firm began its relationship with the stablecoin giant, he said on Wednesday at Consensus 2025 in Toronto.

The 27-year-old said that in the early days of Cantor Fitzgerald and Tether’s relationship, there were “a lot of rumors” that Tether didn’t have the assets it claimed to have, referring to then-rampant speculation that Tether was not fully backed. New York Attorney General Letitia James alleged in 2019 that Tether had a nearly $1 billion hole in its books, though the regulator later settled these allegations with Tether and its sister firm, Bitfinex.

“I personally checked a lot of their reserves, and we proved a lot of those rumors wrong,” Lutnick said. Tether has maintained it has been fully backed, at least since its settlement with New York.

Lutnick was appointed chairman of Cantor Fitzgerald — the private parent company that controls the investment bank of the same name, brokerage BCG Group, and commercial real estate company Newmark Group — in February, shortly after U.S. President Donald Trump named his father, Cantor Fitzgerald’s former CEO Howard Lutnick, U.S. Commerce secretary.

Prior to taking the helm at Cantor Fitzgerald, Lutnick worked for the firm in another executive role. He denied reports from Bloomberg that he interned with Tether in Lugano, Switzerland in 2023.

“Bloomberg actually reported that I was a Tether intern. That is not true,” Lutnick said. “But I did learn a lot about crypto from the Tether guys — they orange-pilled me.”