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TLDR:

July 2025 marked the biggest shift in crypto history. The Genius Act became the first major US law governing cryptocurrencies, bringing stablecoins into mainstream finance and making America the global crypto capital. While most people argue about Bitcoin prices, the real story is happening behind the scenes.

Stablecoin issuers just filed for federal banking charters to eliminate middlemen entirely. Bitcoin hit $123,000 while Ethereum corporate holdings surged 127%. A record $5.3 billion flowed into crypto projects in one month. Europe launched USDG under strict regulations, challenging US dollar dominance in payments.

The regulatory uncertainty that kept institutions on the sidelines has vanished. Companies can now trade S&P 500 index products alongside crypto assets 24/7, creating borderless markets that never close. States must choose their crypto strategy or watch businesses move elsewhere. Legacy payment providers face extinction if they don't adapt to on-chain functionality. The experimental phase is over.

July 2025 web3 with FTC Recap

Host Tedd Huff welcomes FinTech Confidential CI Rob Musiala, partner at Baker Hostler and leader of the firm's Web3 practice, to break down what changed in July 2025 and why it matters for founders, operators, and institutions right now with clear insights into new U.S. policy, market signals, and real moves from major issuers and banks without the usual industry jargon.

In this episode the Tedd and Rob discuss how the Genius Act created a clear federal framework for payment stablecoins, separating them from securities oversight and moving compliance to a risk-based model that actually makes sense. The act gives stablecoin programs a defined path with reserve rules, bank custody, attestations, and bankruptcy priority for retail holders. When Rob Musiala explains that "with the Genius Act, stablecoins are now part of the mainstream financial system," he's pointing to something fundamental: rules that teams can actually build on. When you have predictability, teams invest with confidence, and July's data backs that up.

The funding numbers tell a story that's hard to ignore. July brought more than $5.3 billion in new inflows into crypto projects, plus the strongest quarterly raise since 2022, which shows a clear shift from testing to execution. This isn't speculative money anymore - it's spread across blockchain infrastructure, DeFi protocols, stablecoins, and service sectors in ways that suggest institutional investors see real opportunities where regulatory clarity meets technical capability. The venture capital surge reached $10.03 billion in Q2 2025 alone, with July hitting $5.14 billion as the strongest single month since January 2022.

Pricing sent its own signal when Tedd Huff notes that "Bitcoin hits a new high, $123,000 a coin, and Ethereum's corporate holdings surged 127%—institutional confidence is back with serious conviction." Market share in large caps and select alt assets broadened too, suggesting institutions are placing targeted bets where policy and plumbing now line up. Bitcoin's market dominance fell to around 61% while Ethereum climbed to nearly 12%, showing diversification across digital assets as confidence grows beyond just the flagship cryptocurrency. Even altcoins captured 39.2% market share in July, hitting levels not seen since 2022.

Policy clarity unlocked new product design in ways that weren't possible before. The SEC's guidance on protocol staking opened the door for the first U.S. ETF that pairs spot exposure with on-chain staking rewards on a proof-of-stake network, bringing yield mechanics into a regulated wrapper that large accounts can actually touch. Rex Osprey launched their pioneering U.S. ETF combining spot Solana exposure with on-chain staking rewards, holding majority assets directly staked with the remainder in staking ETPs and liquid staking tokens. This isn't just a talking point; it's a design choice that turns staking into an operational feature for public market products at scale, listed on major U.S. options exchanges and providing institutional access to Solana staking yields.

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Tokenization stepped forward as well, with S&P Dow Jones Indices announcing a collaboration with Centrifuge tied to an S&P 500 index product that's waiting on approvals. The direction is straightforward: assets that were hard to move or combine are becoming easier to compose alongside crypto in unified flows. When Rob Musiala observes that "tokenized real-world assets are blurring the lines between traditional finance and blockchain, making 24/7, borderless trading a reality," he's describing something practical that traders actually want. The tokenized stock market hit about $370 million in value, representing a 220% surge in interest with characteristics similar to early DeFi booms.

Stablecoin issuers changed their playbook in response to the act's structure. Instead of only partnering with third-party banks, leading issuers moved to secure their own federal trust bank paths and, in one case, to seek direct Federal Reserve access. Circle filed with the OCC for the First National Digital Currency Bank of North America, pursuing federally regulated trust institution status that won't be a traditional deposit-taking bank but will have tight oversight and clear standards. This model reduces reliance on outside intermediaries and tightens control over reserves and rails, which raises the bar for speed, oversight, and cost.

Ripple took an even more aggressive dual-track approach, pursuing both a National Trust Bank charter and direct access to the Federal Reserve payment infrastructure. This allows them to avoid relying on outside banks entirely and send reserves straight through the Fed - a next-level approach that surprised many with its timing and ambition. It also forces banks to decide if they'll compete as affiliates or focus on custody and services for compliant programs.

The global picture is splitting across three zones with different rules: the U.S. under the Genius Act, the EU under MiCA with USDG now live, and the rest of the world where USDT remains most used. USDG launched as the first major stablecoin under MiCA regulation, reaching over 450 million consumers across 30+ countries through triple oversight from EU regulators, Finnish financial supervisory authority, and Singapore's monetary authority. EU oversight around USDG shows how regional policy aims to manage currency risk and keep local control while still meeting demand for a dollar-based unit. In practice, U.S. and EU programs will grow first where they're regulated; over time, expect cross-border alignment to follow the users and the flows.

What makes this particularly interesting is that dollar-backed stablecoins represent over 97% of the worldwide stablecoin market, estimated at about $215 billion. In Europe specifically, over 99% of stablecoins used are tied to U.S. currency. The European Central Bank views this as an accelerated digital dollarization risk, with ECB Executive Board member expressing concerns that stablecoins pegged to the U.S. dollar pose risks to Europe's strategic autonomy and monetary sovereignty.

Consumer and merchant safeguards are now table stakes under the new framework. The act requires one-to-one reserves in approved assets, bank custody of those reserves, monthly attestations by public accounting firms, and full audits above size thresholds. If an issuer fails, retail holders come first in bankruptcy priority, then the reserve bank, then the issuer—an order that matches how real businesses think about payment risk. For larger stablecoin issuers issuing $50 billion or more, audited financial statements will be required just like any public company.

Winners and losers are already becoming visible across the landscape. Winners include compliant stablecoin programs, auditors and attestation providers, RegTech companies, analytics and digital ID providers, banks that custody reserves, and enterprises that accept stablecoin payments in e-commerce. Traditional and commercial banks now have a clear path to get involved, which increases demand for auditors and technology providers across the board.

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As Tedd Huff puts it, "legacy financial institutions that don't pivot to digital assets will be the losers in this new regulatory environment," and that applies to unlicensed issuers, non-dollar stables targeting the U.S. without approvals, offshore venues seeking regulatory arbitrage, and remittance providers that don't add stablecoin rails. Cross-border payment providers that can't integrate on-chain functionality will find themselves unable to compete with the speed and cost advantages of stablecoin settlement.

States now have a choice to make since the act allows state-supervised issuers under $10 billion if a state builds a compliant regime. Some states will move fast to attract firms and jobs while others may cede that ground to federal or out-of-state programs. Markets will reward speed, clarity, and operational support; silence will push activity elsewhere. Wyoming is expected to lead, with Texas and Florida likely close behind, while states like New York and California face interesting decisions given their existing regulatory frameworks.

Market performance data reinforces institutional confidence. Coinbase hit a 6,200% increase in average trading volume year-over-year, expanded perpetual futures from 15 to 106 contracts, and saw their institutional desk represent over 27% of overall fee income. They processed over $2.8 billion in crypto payments for the first half of 2025, generating over $41 million in fees, while maintaining 24% year-over-year revenue growth despite Q1 challenges.

What to watch next is both simple and high impact. Expect more ETF filings that include staking mechanics where policy allows, more issuers pursuing federal trust charters and direct Fed access, growth in on-chain index products that sit next to crypto in one workflow, and enterprise teams adding stablecoins for payouts, collections, and cross-border settlement. When Tedd Huff says that "July of 2025 really represents the end of the experimental phase and the beginning of the implementation for a true Web3 America," he's describing a shift where the rules are here, the funding is real, and the plumbing is being built by firms that plan to lead.

July 2025 marks the definitive moment when America positions itself as the global crypto capital. The convergence of the Genius Act's regulatory clarity, strategic moves by Circle and Ripple to secure banking charters has eliminated the uncertainty that kept enterprises on the sidelines.

The experimental phase is over; Web3 has moved from "what if" to "how fast." States must now choose whether to build compliant frameworks that attract the next generation of financial companies or watch capital migrate elsewhere. For founders, operators, and institutions, the question is no longer whether digital assets will integrate with traditional finance, but how quickly organizations can adapt to a reality where 24/7 borderless markets become the competitive standard. The rules are here, the funding is real, and America is leading the charge.

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Key Highlights:

Genius Act Changes Everything

The Genius Act marks a historic regulatory milestone in the United States, formally integrating stablecoins into the mainstream US financial system. This legislation provides critical legal clarity and a comprehensive framework that enhances consumer protection, fosters innovation, and strengthens confidence in the digital asset industry, paving the way for broader adoption and development.

Record Investment Soars

Record-breaking venture capital investment and burgeoning institutional interest are fueling unprecedented growth in both the US and global blockchain infrastructure, decentralized finance (DeFi) protocols, and stablecoin markets. This surge in funding underscores growing confidence in digital finance technologies and signals a new era of innovation and expansion for the crypto economy.

Bitcoin Hits $123K

Bitcoin has reached an all-time high of $123,000 per coin while Ethereum's corporate holdings surged by 127%, signaling renewed and strong institutional confidence across global crypto markets. These milestones highlight the increasing acceptance of cryptocurrencies as viable assets and underline their growing role in diversified investment portfolios worldwide.

Stablecoins Rule DeFi

Stablecoins have become the backbone of the DeFi ecosystem by providing essential liquidity and stability. With US dollar-backed stablecoins leading the charge, these digital assets dominate both American and international markets, facilitating efficient decentralized finance operations and fueling the continued growth of blockchain-based financial applications.

Europe Fights Back

The launch of the USDG stablecoin within the European Union under the stringent MiCA regulatory framework reflects intensifying global competition and regulatory divergence shaping the future landscape of fiat-backed digital currencies. This development challenges US dollar dominance in payments and heralds a new chapter of cross-border digital finance innovation.

Banking Charter Race

Leading US stablecoin issuers such as Circle and Ripple are aggressively pursuing federal banking charters, embracing innovative business models that seek to eliminate traditional banking intermediaries. These moves are strategically aimed at strengthening the US payment infrastructure and reshaping how financial services integrate with blockchain technology.

Regulators Clear Path

Consistent and clear regulatory guidance from the US Securities and Exchange Commission (SEC) combined with strategic digital asset policy initiatives from the White House have drastically reduced market uncertainty. This clarity has encouraged broader institutional participation, fostering a more stable and mature environment for blockchain and digital asset investments.

Assets Go Token

The tokenization of real-world assets, including prominent financial instruments like the S&P 500 index products, is effectively bridging the gap between traditional finance and blockchain markets. This fusion expands investment opportunities globally, offering new liquidity mechanisms and access to a broader range of asset classes through decentralized platforms.

Winners Take All

Legacy financial institutions and payment service providers operating in the US and internationally face a critical juncture: adapt to the evolving compliant crypto asset ecosystem or risk losing relevance. Embracing digital asset adoption is becoming essential to maintaining competitive edge and meeting emerging customer demands in a rapidly digitizing financial world.

Compliance Drives Growth

Consumer protection, regulatory transparency, and rigorous compliance standards have become central pillars of both US and international stablecoin regulatory frameworks. With new mandates for regular audits, secure reserve backing, and prioritized bankruptcy protections, these regulations foster safer, more trustworthy markets and instill higher confidence among participants.

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Takeaways:

1️⃣ States Create Their Own Advantage

Monitor which states pass compliant legislation to allow stablecoin issuers under $10 billion market cap to operate through state oversight. Wyoming leads this race, with Texas and Florida following. Consider relocating your operations to winner states before they reach capacity.

2️⃣ NFT Volume Jumps 50% Again

Watch for the single large purchases driving market recovery, like the 45 different crypto punks bought in one transaction during July. These institutional moves often signal broader market shifts before retail investors catch on.

3️⃣ 24/7 Trading Changes Everything

Start positioning your portfolio for borderless, round-the-clock trading opportunities. Traditional market hours no longer matter when tokenized assets let you trade S&P 500 index products alongside crypto at 3 AM on federal holidays.

4️⃣ Federal Reserve Access Battle Begins

Track which stablecoin issuers successfully gain master account access at the Federal Reserve. Previous attempts failed, but the current regulatory climate creates new opportunities for direct Fed relationships that eliminate banking intermediaries.

5️⃣ Monthly Attestations Now Required

Prepare for new compliance costs as the Genius Act requires monthly reports by public accounting firms for all major stablecoin issuers. Companies issuing $50 billion or more must provide audited financial statements like public companies.

Links:

Robert A. Musiala Jr.

BakerHostetler Profile: https://www.bakerlaw.com/professionals/robert-a-musiala-jr/

LinkedIn: https://www.linkedin.com/in/robert-a-musiala-jr-esq-cfcs-b6534bb/ 

BakerHostetler

Website: https://www.bakerlaw.com/ 

The Blockchain Monitor: https://www.theblockchainmonitor.com/ 

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Time Stamps:

About The Guest:

Robert Musiala - Partner - BakerHostetler

Robert Musiala has been working in the blockchain and digital assets market since 2012 and has led multiple digital asset investigations, including as the court appointed receiver over cryptocurrency investment funds used in a major fraud. Robert also advises on a variety of regulatory compliance issues involving digital assets and has drafted/negotiated agreements for a wide range of transactions in the fintech, digital assets, Web3 and NFT markets. The inventor of two blockchain patents, he works directly with tech teams to build solutions that are compliant by design. Robert is co-leader of the Web3 and Digital Assets team at BakerHostetler.

About the Host:

Tedd Huff: 

Tedd Huff is the Founder of Voalyre, and Diamond D3, professional services consulting firms focused on global payments and marketing. He is also a video podcast host and executive producer on the Fintech Confidential network.

Over the past 24 years, he has contributed to FinTech startups as an Advisory Board Member, Co-Founder, and Chief Experience Officer, providing strategic and tactical direction for Global Payments OpenEdge, Heartland Payments, Nuvei, and TSYS, among others, focusing on growth while delivering innovation, process improvements and user experience-driven value to simplify the complexity of payments.

DD3, Media: 

DD3 Media is a media creation, management, and production company delivering engaging content globally

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