J.P.Morgasm price

Source: Silicon Valley 101 Finishing & compilation: Daisy, ChainCatcher Editor's note: This article is based on an audio interview with podcast hosts Hong Jun and Feng Liu with Can Sun and Zheng Di. Hong Jun is the manager of "Silicon Valley 101", and Liu Feng is the manager of "Web3 101", a partner of BODL Ventures, and the former editor-in-chief of Chainnews. Guest Can Sun is the co-founder and head of legal compliance of Backpack Exchange, and has been deeply involved in the design of USDC's legal structure. Di Zheng is a cutting-edge investor focusing on finance and crypto technology. The interview takes the Circle listing as a starting point, and delves into the differences between USDC and Tether (USDT) in terms of compliance paths, profit models, and alliance structures, and extends to the future regulatory trends of stablecoins, changes in the platform landscape, and the strategic possibility of combining with AI and global settlement networks. The following is a compilation of the interviews. TL; DR： Circle became the first stablecoin issuer to go public, and USDC was seen as a representative of the "digital dollar", and the skyrocketing market capitalization attracted market attention. The stablecoin market has entered a white heat, with compliant USDC competing with non-compliant USDT, and traditional financial and technology giants accelerating their entry. Coinbase is deeply bound to USDC, which has promoted its rapid expansion, but its profits have long been limited by the revenue sharing protocol. Tether dominates the market with a high-yield, high-risk model, and Circle adheres to a compliant and transparent path, with a significant profitability gap. Regulatory proposals such as the Genius Act are expected to reshape the order of the industry and promote the legalization and institutionalization of stablecoins. Circle is building an on-chain global settlement network, combining AI payment scenarios, in an attempt to become a new infrastructure for digital finance. Comparison of USDC and Tether systems and profit models Hongjun: First question, why is the Circle listing so popular? Can, what do you think? Can Sun: USDC's core value lies in its use as a settlement and payment tool for the digital dollar. The traditional financial payment system has hardly changed in decades, bank transfers are limited by working hours, and the overall efficiency is still stuck in the last century. By digitizing the U.S. dollar, Circle has the ability to settle in real-time 24 hours a day around the world, which is a fundamental upgrade for the entire financial system. Another highlight of Circle's listing is that the underwriters include traditional financial giants such as JP Morgan and Goldman Sachs, which are also exploring the issuance of stablecoins. If they incorporate USDC into the existing clearing system in the future, USDC has the potential to become an "official" digital dollar. Thus, Circle's IPO not only represents the success of a technology company, but also reflects the positive attitude of traditional finance towards the prospects of the digital dollar. Zheng Di: Circle is too deeply tied to Coinbase, which limits its profitability. From a fundamental point of view, the valuation of the $7 billion IPO is reasonable, but the rapid rise in market value to $25 billion reflects the market's expectation of scarcity of compliant stablecoin targets. The stablecoin market itself has great potential for growth. There are two data worth paying attention to: first, the U.S. government and Standard Chartered and other institutions predict that the global stablecoin market will grow from the current $250 billion to $2 trillion by 2028; Second, Michael Saylor and others have a more radical view that the market could reach $10 trillion in the long run. In anticipation of such growth, investors are willing to give higher valuations. Hongjun: 2 trillion refers to the total amount of the entire stablecoin market? Zheng Di: At present, Circle's share of the stablecoin market is about 24% to 25%. If its market share remains the same, the market as a whole will expand by 8 times, and the corresponding assets of Circle could grow to $480 billion or more. Hongjun: Background information. Tether, the issuer of USDT, is an offshore institution and is not regulated in the United States; USDC is issued by Circle, registered in the United States and regulated by various states, and is a compliant stablecoin. Up to now, the global stablecoin market value is about $250 billion, of which USDT is about $150 billion, accounting for 62.5%; USDC is about $61 billion, accounting for about 24%. So, what are the specific aspects of USDC's "compliance"? It is understood that Circle disclosed a lot of operating costs and compliance information in the IPO prospectus. And Tether is regarded as one of the most profitable crypto companies at the moment. Can Sun: At present, there is no unified federal stablecoin regulatory law in the United States, and there is a lack of a complete framework similar to the European Union's MiCA. USDC's "compliance" is primarily reflected in the fact that it operates under the supervision of various states, especially the New York State Department of Financial Services (NYDFS), which is subject to regulations regarding reserve management and audit disclosures. USDC publishes a monthly reserve structure, which is fully allocated to government money market funds and short-term U.S. Treasury bonds, held in custody by large banks or independent trusts, and audited. In contrast, Tether, although it has also begun to disclose reserves in recent years, has a more complex asset class and relatively low transparency. Liu Feng: Regarding the "Genius Act", can you introduce the provisions that have the greatest impact on the industry? What are the possible implications of this legislation for Tether and the stablecoin industry as a whole? Can Sun: This bill has not yet been formally passed, and it is still being negotiated by the U.S. Senate and House of Representatives. Once implemented, it will be the first federal-level stablecoin regulatory framework, which will bring significant benefits to the industry, as traditional financial institutions such as banks and funds will be able to legally participate after clear regulation. One of the most critical terms stipulates that any stablecoin wishing to circulate in the United States or serve U.S. users must be licensed by U.S. regulators, or accept equivalent regulation recognized by the U.S. Otherwise, the government can ban its listing on U.S. exchanges and have the power to freeze its dollar reserves. This provision has a particularly significant impact on Tether. Most of the world's dollar settlements rely on the U.S.-led clearing system, and even if Tether holds U.S. dollar accounts abroad, the U.S. government has the ability to cut off U.S. dollar flows as long as its clearing bank is based in the U.S. Liu Feng: In other words, the United States can directly "get stuck" through the dollar system? Can Sun: Yes. If Tether is unable to meet U.S. regulatory requirements, the government can require banks to stop holding U.S. dollar reserves for it. Once the reserves are frozen, USDT will lose its ability to peg 1:1 to the US dollar, which is a fatal blow for stablecoins. Historically, the United States has used the financial system as a sanction tool, and countries such as Iran and North Korea have been constrained by it. Feng Liu: Do you think Tether has the ability to meet the relevant regulatory requirements? Is it possible to operate legally compliantly in the United States? Can Sun: The Tether team is capable, and it's really pushing for compliance and transparency. However, it is uncertain whether US regulatory requirements can be met in the short term. Especially when regulatory standards are high, its reserve structure and corporate governance may need to take longer to adjust. Feng Liu: This means that the competition will be more fair in the future. In the past, Tether has benefited from regulatory arbitrage, while USDC has borne higher compliance costs. As the rules converge, Tether will have to catch up. Can Sun: Yes, there is a common practice in the crypto industry of "no regulation first, then compliance", and many projects operate offshore in the early stage and seek compliance after they grow. But once strict regulations are implemented in the U.S., organizations like Tether will be required to meet regulatory standards from the start, and will no longer be able to rely on regulatory gaps to survive. Hongjun: We have just analyzed the reasons why USDC is attracting attention, and let's review the development path of Circle. The company was founded in 2013 and USDC was launched in 2018. Can, were you involved in the development of legal documents for Circle and Coinbase to jointly launch USDC? In addition, why did Circle choose to enter the stablecoin track in the first place? How did you work with Coinbase? Can Sun: In 2018, the stablecoin market was almost monopolized by USDT, and the asset transfer and loss recovery between exchanges were highly dependent on USDT, but due to its offshore operation and opaque information, there were great risks. Circle was diversifying at the time, owning businesses such as the Poloniex exchange, OTC trading, and payment instruments, but these did not form a core breakthrough. Realizing that there was a lack of compliant stablecoins in the market, they partnered with Coinbase to form a joint venture, Center, to jointly launch USDC. The two companies each hold 50% of the shares and are jointly responsible for the issuance and governance of USDC, with the goal of building a transparent, compliant, and auditable stablecoin system. Feng Liu: In the early days, Circle had diversified businesses, including Bitcoin wallets, payment products, OTC trading, and the operation of the Poloniex exchange. Since then, the company has successively divested these businesses, eventually focusing on USDC. Can this be seen as a kind of "strategic all in"? How did you see this shift at the time? Can Sun: Yes, Circle gradually divested its Bitcoin wallet, OTC trading, Poloniex and other businesses after 2019 to focus on USDC. At the time, there were doubts about this "give it all" strategy, after all, Poloniex still has scale and the OTC business has a stable institutional clientele. But Circle predicts that compliant stablecoins have the potential to become an important part of the financial infrastructure of the future. Whoever can be the first to enter the market and build ecological barriers is likely to become the core bearer of the "digital dollar". USDC's transparency and compliance have earned it recognition from large institutions, payment companies, and even governments. The company judges that this is a "winner-takes-all" track, and the strategic value of the stablecoin ecosystem is much higher than the short-term gains of other marginal businesses. Hongjun: According to Circle's prospectus, Coinbase has withdrawn from the ranks of shareholders of Center, but still retains 50% of USDC interest income. What is the background behind this revenue sharing agreement? What are your thoughts on this? Can Sun: This sharing agreement was reached when USDC was first established. Coinbase provides key resources for USDC, including user channels, wallet systems, and exchange listing support. In return, Circle signed an interest income sharing agreement with it. The agreement stipulates that as long as Coinbase meets certain growth KPIs each year, it can renew and receive 50% of USDC interest income over the long term. So far, Coinbase has indeed achieved these goals. This also means that although Circle bears the issuance, operation, and legal responsibilities, it can only retain half of the proceeds, and the other half needs to be distributed to Coinbase, limiting its profitability. Zheng Di: Coinbase essentially plays the role of "lying to earn". It does not bear the legal and regulatory responsibilities for the issuance of USDC, but by virtue of the early binding, it has obtained a long-term profit sharing mechanism, almost becoming a "perpetual dividend platform". Although Circle's overall profit seems to be substantial, it has shrunk significantly after the share. Can Sun: Yes, but from a strategic point of view, this bonding did help USDC open the market quickly in the early days. As a compliant exchange, Coinbase has promoted the launch of USDC and integrated wallet support, establishing a solid initial ecosystem for it. While this "divide and win" strategy was a reasonable choice at the time, it now puts Circle in a relatively passive position in terms of revenue structure. Liu Feng: This reminds me of another question. In recent years, Binance has gradually reduced its support for USDC in favor of a stablecoin called USD1. USD1 is rumored to be behind the Trump family and Abu Dhabi funds. Can, how do you see this trend? Can Sun: USD1 is issued by First Digital, headquartered in Hong Kong and registered in Abu Dhabi. Binance has a close relationship with it, mainly because the project provides the platform with more bargaining space and revenue sharing. In contrast, USDC is deeply tied to Coinbase, and Binance not only needs to bear the cost of use, but also cannot get a profit share, so it gradually reduces its support. This phenomenon reflects a trend in the stablecoin market: major platforms have begun to support their own or cooperative stablecoins, and gradually form different alliance camps. Zheng Di: At present, the stablecoin market can be roughly divided into five camps: The first is the USDT camp dominated by Tether, which has the largest market share and the most widespread application, but the compliance is relatively weak. The second is the USDC camp, which is dominated by Circle, emphasizes compliance and transparency, and is deeply bound to Coinbase. The third is Binance's USD1, which has obvious platform attributes and a complex capital structure behind it. The fourth is the camp of technology companies, including PYUSD issued by PayPal and USDB supported by Stripe, relying on their own payment networks to promote the landing of stablecoins. Fifth, traditional banks, such as JPMorgan Chase's JPM Coin and Citigroup's internal stablecoin, are mainly used for inter-institutional B2B clearing. Feng Liu: How do you think these stablecoin camps will evolve in the future? Will they end up as duopolys, or will they each occupy different markets? Zheng Di: I think the stablecoin market may eventually form a pattern similar to an operating system, dominated by two or three. Just like Android and iOS, one is open but risky, and the other is closed but has an emphasis on compliance, and the two can coexist for a long time. Tether will continue to serve non-compliant markets, DeFi, and high-risk transactions, while compliant stablecoins such as USDC will gradually enter the mainstream financial system such as payment, clearing, and banking. Hongjun: We just mentioned the difference between USDC and USDT in terms of profit models. Can you elaborate on how stablecoin issuers are profitable? For example, how does Circle earn revenue after a user redeems 1 USDC? Can Sun: The profit model of stablecoins is relatively simple. When a user exchanges 1 USDC, Circle gets 1 USD reserve. The funds will be invested in high-liquid, low-risk assets such as U.S. Treasury bonds and money market funds, with an annualized return of about 4% at the current rate. Since USDC holders do not enjoy interest, all proceeds go to the issuer, forming a clear "spread" - no interest payment can be achieved for a stable return on the asset. Feng Liu: So if Circle currently manages about $61 billion in USDC, based on an annualized return of 4%, it is equivalent to about $2.4 billion in interest income per year? Can Sun: In theory, yes, but the actual earnings are subject to a number of costs, such as the share paid to Coinbase, operating expenses, and audit fees. Even so, Circle has remained profitable, especially during the interest rate hike cycle, with significant growth in interest income. Zheng Di: Tether's profit model is relatively more aggressive. Although its reserves also include safe assets such as U.S. bonds and cash, disclosures show that it also includes high-risk assets such as Bitcoin, gold and equity in private companies, so the overall yield is significantly higher than that of Circle. The market estimates that Tether's annual profit could exceed $6 billion, while Circle is less than half of that. This also gives Tether the ability to continue to pay large dividends, make investments, and acquisitions. Circle's development strategy and the trend of stablecoin alliance Hongjun: Sounds like Tether operates more like a hedge fund than a financial infrastructure provider? Can Sun: Exactly. Tether operates closer to an asset manager, relying on user reserves for high-yield portfolio allocation, which has significant returns but relatively high credit risk. In contrast, Circle is closer to the banking model, emphasizing asset transparency, compliance, and low risk management, and does not participate in high-risk investments. Despite the lower returns, it is more credible in regulators and the financial system. Feng Liu: Will regulators allow Tether's "high-yield, high-risk" model to persist for a long time? In particular, in the event of a run, could there be a systemic impact on the entire crypto financial system? Can Sun This is a very real problem. Tether has a market cap of more than twice that of USDC and accounts for more than 60% of the stablecoin market. In the event of a liquidity crisis or a major default, it could trigger a "Lehman moment" in the crypto financial system. To this end, many DeFi protocols and trading platforms have begun to hedge risk, such as diversifying the use of multiple stablecoins, setting a cap on the proportion of holdings, or adopting a stablecoin basket mechanism to reduce the dependence on a single stablecoin. Di Zheng: Tether has not defaulted so far, but in the context of stricter regulation, it will either be forced to move towards transparency and accept regulation in the future, or continue to operate in the "gray zone", and the space for the latter will become more and more limited. Relatively speaking, if Circle can gradually break into the traditional financial system, such as establishing clearing cooperation with Visa, Stripe, banks and other institutions, it is expected to expand its market share in the long run. However, this path is slower, more expensive to operate, and margins are relatively limited. Hongjun: It can be said that this is a game of high returns and compliance and stability. Tether is profitable and profitable, but it comes with great risks; Circle's path is robust, compliant, and sustainable, but its revenue is relatively limited. Can Sun: Yes. Tether's success relies on first-mover advantage and rapid expansion in the early market gap; Circle, on the other hand, is betting on regulatory trends and the long-term evolution of the traditional financial system. Feng Liu: How do you see the development of these two models in the next few years? Is it possible for Circle to gradually catch up with Tether, or will Tether continue to stay ahead? Di Zheng: It's hard to make a definitive judgment and it depends on a few key factors. The first is the regulatory process, whether the United States can put in place a clear legal framework for stablecoins in the next two to three years; secondly, whether financial institutions are more inclined to work with compliance models; Finally, whether Tether can continue to maintain high returns and properly manage risks. I tend to believe that in the future, the stablecoin market will present a "dual-track" pattern: one track serves high-risk DeFi and offshore platforms, mainly USDT; The other track is geared towards institutional settlement and compliance scenarios, led by USDC or other new compliant stablecoins. Can Sun: I agree with that judgment. Just as the current financial system is divided into a banking system and a shadow banking system, stablecoins may also move towards dual-track development in the future. However, in key countries and core financial scenarios, the market share of compliant stablecoins is expected to gradually increase. The technological evolution of stablecoins and the implementation of emerging scenarios Jun Hong: We've discussed the past and present of stablecoins, and finally I'd like to ask you to look forward to the future direction. What application scenarios may USDC enter next? In addition to expanding market share, does Circle have a new strategic layout? Can Sun: Circle's core strategy is to build a global settlement network. The company has launched a protocol called CCTP (Cross-Chain Transfer Protocol), which supports the seamless transfer of USDC between multiple blockchains and connects with the banking system, essentially creating an on-chain dollar clearing system. Compared with the traditional USD clearing process, USDC has the advantages of real-time arrival, low cost, and transparent traceability. If Circle can successfully connect national payment systems with the USDC network, it will be possible to establish itself as the global clearing standard. Zheng Di: Another important direction is the integration of AI and stablecoins. More and more AI companies are building automated payment systems for payroll, contract enforcement, costing, and cross-border settlements, among other scenarios, which are well suited to stablecoins. USDC has the advantages of on-chain transparency, programmability, and fast settlement, and is suitable as a basic settlement asset for AI enterprises. In the future, AI systems may be directly connected to on-chain payment APIs to fully automate the flow of funds, which will become an important new application scenario for stablecoins. Feng Liu: It can be said that AI is becoming an "amplifier" of stablecoins. An AI system that operates around the clock, together with a payment network that settles around the clock, will greatly improve the efficiency and automation of capital flows. Can Sun: Yes. Circle has partnered with a number of AI automation companies to develop prototype products with features such as automated invoicing, bookkeeping, contract execution, and USDC settlement. Once these tools mature, the application of stablecoins will no longer be limited to the field of crypto trading, but will gradually be integrated into mainstream business scenarios such as enterprise financial systems, SaaS platforms, and financial software. The future pattern of stablecoins and the winning rules Hongjun: What do you think about the trend of traditional banks issuing stablecoins? JPM Coin like JP Morgan has already gone live, and Wells Fargo, Citigroup, and others are also exploring similar projects. Will these banks be competitors to Circle? Can Sun: Most of the stablecoins issued by traditional banks run on private chains, which are limited to clearing within banks or between specific large customers, and are closed systems that cannot be connected to mainstream wallets or DeFi protocols. In contrast, USDC is an open network, which can be used by any individual or institution, and developers can also access it freely. It's like the difference between the internet and a LAN – a bank's stablecoin is more like a LAN and is only for internal use; USDC, on the other hand, is an open internet with stronger compatibility and scalability. Zheng Di: However, the power of banks should not be underestimated. They have a large customer base, extensive network layout, and compliance benefits. If regulation is deregulated in the future, banks have the ability to quickly promote their own stablecoins. The key for Circle is to take the lead in establishing a "financial infrastructure" status within a compliance framework. Once its stablecoin becomes the liquidation layer of the mainstream financial system, it can form a strong network effect and first-mover advantage. Feng Liu: How do you see the possible structural changes in the stablecoin industry in the next few years? Among the multiple players such as Circle, Tether, traditional banks, tech companies, etc., who is more likely to come out on top? Zheng Di: In the next five to ten years, stablecoins will gradually evolve into financial infrastructure. Projects with real long-term development potential need to have three capabilities at the same time: one is to obtain regulatory recognition, the second is to apply in actual payment scenarios, and the third is to have the ability to build a global clearing network. As it stands, Circle is the only project that has the potential to meet all three of these requirements. Tether has strong profitability, but there are obvious shortcomings in compliance; Stablecoins issued by banks have compliance advantages, but the technical architecture is closed; The stablecoins launched by technology companies are supported by application scenarios, but users' trust in their financial attributes is still limited. Can Sun: The ultimate competition is not about market capitalization, but about who can be the "clearing foundation of the digital financial system". Just like SWIFT and VISA today, stablecoins compete for multi-dimensional capabilities such as settlement efficiency, credit level, regulatory, and ecosystem building.

Which asset will accrue the most value from JPMD adoption? > $ETH > $COIN > $JPM

Breaking news from yesterday and thoughts - $24B AUM, Purpose Investments received final regulatory approval to offer XRP ETF set to launch on June 18 on the Toronto Stock Exchange Ontario Securities Commission (OSC), Canada’s top regulator will allow $XRP ETF product in registered accounts, allowing customers to significantly reduce taxes on these assets. - Justin Sun linked firm is taking the Tron ecosystem public in the US via a reverse merger with Nasdaq listed SRM Entertainment. Deal’s backed by Dominari Securities (with ties to Trump Jr & Eric Trump). The new entity, Tron Inc, will stack TRX on its balance sheet, mirroring the Michael Saylor / Strategy playbook. Sun’s an advisor. Rumors say Eric Trump might key in, though he’s denying any involvement. Initial treasury strategy kicks off with a $210M TRX injection. SRM confirmed a $100M equity deal to fund the move and plans to roll out a dividend policy tied to staking rewards. - JPMorgan just filed a trademark for “JPMD,” sparking speculation of a new stablecoin The filing hints at broad digital asset services: trading, payments, brokerage, and on chain fund transfers built on blockchain. No direct mention of stablecoin, but it screams RWA + payment rails. This won’t be JPM’s first direct crypto exposure: their Kinexys platform runs JPM Coin, a permissioned Ethereum fork that’s settled $1.5T+ in tokenized USD, GBP, and EUR transfers.

[COINDESK] U.S.-Listed Bitcoin Miners' Share of Network Hashrate Hit Record High in June: JPMorgan $BTC $JPM

More smoke and mirrors again by Jamie. J.P. Morgan was helping Consensys build Ethereum in 2017, they then built Quorum and JPM Coin. Most recently, they used Ondo to test Tokenized Settlement