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TLDR:

October 2025 hit different. Bitcoin crashed harder than any October since 2015, someone accidentally minted $300 trillion in stablecoins, and traditional banks started an all-out war against crypto companies trying to get federal charters.

Tedd Huff, founder of Fintech Confidential and CEO of Voalyre, breaks it all down with Rob Musiala, partner at Baker Hostetler who co-leads The Blockchain Monitor. They walk through why stablecoins just crushed major card networks with $2.6 trillion in annual volume, how Western Union suddenly decided blockchain payments make sense, and what the Genius Act really means for everyone trying to operate in this space.

This isn’t theory. Banks are fighting to protect their turf while crypto infrastructure gets bought up for billions. The conversation covers enforcement crackdowns, court rulings that actually matter, and why sitting this one out stopped being an option months ago.

September 2025 web3 with FTC Recap

October 2025 proved to be one of the most volatile months in crypto history, with Bitcoin suffering its worst October performance since 2015 while stablecoins surged past major card networks in transaction volume. A $300 trillion accidental minting error exposed critical infrastructure risks, traditional banks launched an organized campaign against crypto companies seeking federal charters, and landmark court rulings began clarifying how securities laws apply to NFTs and other crypto assets. The month revealed a financial sector at an inflection point, where established institutions fight to protect market share while simultaneously recognizing the unstoppable momentum of blockchain-based payment systems.

Tedd Huff, founder of Fintech Confidential and CEO of advisory firm Voalyre, sits down with Rob Musiala, partner at Baker Hostetler who co-leads their Web3 practice and The Blockchain Monitor blog, to dissect what turned out to be one of the most turbulent months in recent crypto history.

October 2025 brought the kind of chaos that makes regulators nervous and investors question their positions. Bitcoin hit a new peak at $126,200 on October 6th, marking its third consecutive month closing above the $100,000 threshold. The celebration lasted exactly four days. When the administration announced new tariffs on October 10th, the crypto markets plunged. Bitcoin crashed 18% to $104,782 in a matter of hours, erasing $19 billion in leveraged positions across 1.6 million traders. The month closed down 4% to 5% near $110,000, making it Bitcoin's worst October performance since 2015.

The sell-off wasn't isolated to Bitcoin. Ethereum dropped 10% during October to close near $3,856 after reaching its all-time high of $4,953 back in August. The asset briefly touched the $3,000 mark, erasing nearly all of its 2025 gains. On-chain volume for Bitcoin reached $2.3 trillion, the highest level since November 2024, while volatility spiked from 40% to 60% during the worst of the decline. Despite the turbulence, Ethereum's upcoming Fusaka upgrade remains locked in for December 3rd, promising to lower rollup costs and increase node bandwidth.

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But the real story of October wasn't about price crashes or technical upgrades. It was about an error so massive it temporarily minted more value than exists in the entire global economy. Paxos accidentally created over $300 trillion worth of PYUSD during an internal transfer, more than twice the world's GDP. The mistake was corrected within 20 minutes, but it exposed the risks inherent in centralized control of stablecoin infrastructure. This incident became a focal point in ongoing debates about regulation and oversight.

Stablecoins emerged as the undisputed winner of October's chaos. While traditional cryptocurrencies hemorrhaged value, the stablecoin market surged to $307 billion with estimated annual transfer volume reaching $2.6 trillion. That figure represents two and a half times the combined purchase volume of the world's two largest US-based card networks. USDT maintains its dominant position with 60% market share at $150 billion, while USDC holds $67 billion. Ripple's RLUSD crossed the $1 billion mark after experiencing 1,278% year-to-date growth.

The stablecoin sector received validation from an unexpected source when Western Union announced plans to launch a federally regulated stablecoin on Solana, targeting the first half of 2026 for launch. The company plans to integrate the stablecoin with its network of over 550,000 agent locations across more than 150 countries, combining federal oversight with Solana's high-throughput blockchain infrastructure. This represents a significant endorsement of the technology from one of the world's oldest and largest money transfer networks.

Western Union wasn't alone in recognizing stablecoins' potential. Reports emerged that Zero Hash, a crypto infrastructure firm, is in late-stage talks to be acquired by a top-three global payments network for approximately $2 billion. The acquisition would provide the buyer with access to regulated infrastructure supporting stablecoin payments, crypto trading, custody, and other tokenized assets across multiple US states. Meanwhile, Tether continued moving forward with plans to launch USAT, a new stablecoin featuring reserves exclusively compliant with the Genius Act, while USDT continues operating globally as a foreign stablecoin issuer.

Even central bankers are taking notice. US Federal Reserve Governor Christopher Waller unveiled a proposal for limited-purpose "skinny payment accounts" that would allow eligible stablecoin issuers to access Fed rails like Fedwire and FedNow directly. The proposal aims to promote competition and speed in the payment system while maintaining eligibility requirements and imposing balance caps. Governor Michael Barr countered the IMF's warnings about the $305 billion stablecoin market, arguing that the Genius Act's tight control over reserve assets could enhance stablecoin stability and make them more viable as long-term payment instruments.

The regulatory landscape grew more contentious as three additional crypto companies filed applications for OCC national trust bank charters. Crypto.com, Connectia Trust NA (affiliated with a major Japanese electronics company), and Bridge (affiliated with a major US payments company) joined Ripple, Circle, and Paxos in seeking federal banking charters. The Bank Policy Institute responded by publishing a series of letters specifically urging the SEC to reject the pending applications.

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Rather than issuing a single letter opposing all applications, the Bank Policy Institute published five separate letters, each individually addressing a specific OCC trust charter applicant and explaining why that particular application should be denied. The letters argue that applicants are engaging in activities that "closely mirror core banking functions such as managing stablecoin reserves, facilitating payments and taking deposits," suggesting these companies need full-service national bank charters rather than limited trust charters. One letter compared the situation to subprime mortgages: "Just as the OCC should not (and we offer never would) grant a national trust bank charter to an institution solely focused on, for example, the subprime mortgage market, the OCC should not grant a charter to an institution solely focused on the crypto asset market."

The courts provided some clarity on at least one contentious issue. A California federal district court judge ruled that Bored Ape NFTs are not securities, dismissing a proposed securities class action against the collection's creator. The judge found that NFT sales failed key prongs of the Supreme Court's Howey test for investment contracts and therefore did not constitute securities transactions. This ruling provides important precedent as the industry continues grappling with how existing securities laws apply to new asset classes.

Enforcement actions also made headlines. FinTrac, Canada's anti-money laundering regulator, imposed a $176 million fine against a crypto exchange for various AML violations. The US Department of Justice filed its largest-ever forfeiture action, seeking approximately $15 billion in Bitcoin related to the Prince Group, a Cambodia-based business conglomerate that operates forced labor compounds where individuals are held against their will to engage in crypto fraud schemes known as pig butchering scams.

XRP saw significant developments beyond the ongoing charter applications. Futures options launched on October 14th and 15th, while Ripple announced a pilot program at its Swell 2025 conference in New York City with a major global payments network and a US-regulated bank to settle credit card transactions using RLUSD stablecoin on the XRP ledger. This marks one of the first times a regulated bank will settle fiat payments using a regulated stablecoin on a public blockchain. XRP bounced over 4% following the announcement.

The meme coin sector suffered severe losses, with most major tokens dropping 60% to 80%. Dogecoin maintained its market lead despite significant declines. Shiba Inu trailed at approximately $6.1 billion in market cap. Pepe dropped to a $2.97 billion cap, down 65% from its previous position, with $500 million in daily volumes. Some newcomers surged against the trend, including Mini U, which jumped 203% to a $56 million market cap, and MemeCore, which rose 230% to become the fourth-ranked meme coin.

Layer one and layer two networks saw notable activity. Figure Technology Solutions launched the YLDS stablecoin, a yield-bearing stablecoin, on the SUI layer one blockchain after previously being available only on the Providence blockchain. Ironlight Markets received FINRA approval to launch an alternative trading system that will support both traditional securities and tokenized securities, joining approximately 1,000 ATS platforms in the US capable of facilitating compliant tokenized security issuance and trading.

The first deadline for public comments on the Genius Act passed, with companies from across the crypto asset and financial services sectors submitting initial feedback focused primarily on illicit activity provisions. This commentary reveals clear splits between various market participants, with different sectors focused on issues most relevant to their business models. The public comment period continues as Treasury and the OCC work toward implementing regulations.

October 2025 demonstrated that the crypto sector has reached a critical inflection point. Traditional financial institutions are mounting organized resistance to crypto companies' attempts at legitimacy through federal charters, while simultaneously watching stablecoins process transaction volumes that rival established payment networks. The Paxos minting error highlighted centralization risks that opponents cite when arguing against crypto's mainstream adoption, yet major institutions like Western Union are launching their own stablecoins regardless. Court rulings are slowly establishing precedent on how securities laws apply to crypto assets, even as enforcement actions against bad actors intensify.

The battles forming around OCC charters and the Genius Act implementation will shape how traditional finance and crypto-native companies coexist or compete over the coming years. The stakes are enormous, with hundreds of billions in stablecoin market value and trillions in annual transaction volume now flowing through blockchain-based payment rails.

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Key Highlights:

Bitcoin's Worst October Ever

Bitcoin crashed 18% in hours after tariff announcements wiped out $19 billion in leveraged positions across 1.6 million traders. The month closed down nearly 5% at $110,000, making it the worst October performance since 2015 despite starting with a peak above $126,000.

Three Hundred Trillion Dollar Mistake

Paxos accidentally minted over $300 trillion worth of PYUSD during an internal transfer, creating more than twice the entire global GDP in stablecoin value. The error was corrected within 20 minutes, but it exposed serious risks in centralized stablecoin infrastructure that regulators immediately seized upon.

Stablecoins Beat Card Networks

The stablecoin market hit $307 billion with annual transfer volume reaching $2.6 trillion, representing two and a half times the combined purchase volume of the world's two largest US-based card networks. This marks a major shift in how payments are processed globally.

Banks Declare War on Crypto

The Bank Policy Institute published five separate letters attacking individual crypto companies seeking federal banking charters, comparing them to subprime mortgage lenders. Traditional banks are mounting organized resistance to prevent crypto firms from accessing the same regulatory legitimacy they enjoy.

Western Union Goes Blockchain

One of the world's oldest money transfer networks announced plans to launch a federally regulated stablecoin on Solana, integrating it with over 550,000 agent locations across 150 countries. The move validates blockchain payment technology from an unexpected legacy finance player.

NFTs Are Not Securities

A California federal district court ruled that Bored Ape NFTs failed key tests to qualify as securities, dismissing a class action lawsuit and setting important legal precedent. The decision clarifies how existing securities laws apply to new crypto asset classes.

Two Billion Dollar Crypto Buyout

Zero Hash entered late-stage acquisition talks with a top-three global payments network for approximately $2 billion. The deal would give a major card network instant access to regulated crypto infrastructure spanning stablecoin payments, trading, custody, and tokenized assets.

Fed Wants Stablecoins on Fedwire

US Federal Reserve Governor Christopher Waller proposed allowing eligible stablecoin issuers direct access to Fed payment rails like Fedwire and FedNow through limited-purpose accounts. The plan aims to boost competition and speed in payments while maintaining strict eligibility requirements.

Ripple Pilots Blockchain Credit Card Settlement

Ripple announced a pilot program with a major payments network and US-regulated bank to settle credit card transactions using RLUSD stablecoin on the XRP ledger. This represents one of the first times a regulated bank will settle fiat payments using a regulated stablecoin on a public blockchain.

Fifteen Billion Bitcoin Seizure

The US Department of Justice filed its largest-ever forfeiture action seeking approximately $15 billion in Bitcoin connected to forced labor compounds in Cambodia. The Prince Group operated facilities where people were held against their will to run pig butchering crypto fraud schemes.

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Takeaways:

1️⃣ Banks Need Stablecoin Plans Now:

Financial institutions must evaluate make-or-buy decisions on stablecoin infrastructure before competitors capture market share. Banks choosing to do nothing risk losing customers to platforms offering faster, cheaper blockchain-based payments that already process volumes exceeding major card networks.

2️⃣ Ethereum Upgrade Slashes Costs:

Developers building on Ethereum layer-2 solutions can expect 30-60% lower transaction fees after Fusaka activates December 3rd. Projects and businesses operating on these networks should prepare to adjust pricing models or capture improved margins from reduced blockchain infrastructure costs.

3️⃣ Genius Act Splits Industry:

Stablecoin issuers, custodians, payment facilitators, and exchanges face different compliance requirements based on their specific business models. Companies should review comment letters from their market segment to understand regulatory priorities and prepare for tailored oversight frameworks.

4️⃣ Meme Coins Lost Eighty Percent:

Retail investors and traders experienced 60-80% losses across major meme coins, proving extreme volatility risks. Speculators watching new projects like Mini U and MemeCore that surged during downturns need thorough research before entering positions in highly speculative assets.

5️⃣ Japan Launches Yen Stablecoin:

Businesses operating cross-border payments between Japan and international markets gain new infrastructure for faster, cheaper transactions. Payment companies and merchants serving Japanese customers should explore integration opportunities as institutions push toward 10 trillion yen circulation targets.

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 25+ 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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