The OCC Will Let Crypto Be

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Introduction

Welcome to the first ever edition of the Tokenized newsletter, brought to you by the creators of the Tokenized Podcast. 

We want to be the newsletter for institutions who need help preparing for a Tokenized future.

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The future will be Tokenized.

Join us every week as we meet your Tokenization needs.

Stories you can’t Miss 📰 

🗽 OCC Says Banks can Engage in Crypto Custody & Stablecoin Activities

This could be a gamechanger…

Key Points:

• The new guidance allows banks to custody crypto assets, hold stablecoin reserves, and operate blockchain nodes without receiving prior OCC approval.

• This guidance also removes previous burdensome requirements that mandated banks to obtain regulatory pre-approval for crypto-related activities.

🔈️ The Tokenized Take:

• This regulatory posture represents a significant shift from the previous stance of crypto debanking and ‘Operation Chokepoint 2.0.’

• This creates a substantial new opportunity for regulated financial institutions and banks to seamlessly offer crypto and stablecoin products alongside their existing fiat solutions.

• From Simon: “I had three banks ask me where they get started at Fintech Meetup in Las Vegas this week”

🏦 BBVA To Offer Cryptocurrency Services in Spain

Key Points:

• BBVA has received approval from Spain's Securities and Exchange Commission (CNMV) to offer cryptocurrency services to retail clients

• Initially enabling Bitcoin and Ethereum trading through its mobile banking app.

• BBVA will provide its own cryptocurrency custody technology rather than relying on third-party providers, setting it apart from many banks that partner with external custody solutions.

🔈️ The Tokenized Take:

• This is a major, more “incumbent” bank offering retail customers access to Crypto (although BBVA has always been very tech-forward).

• BBVA benefits from the regulatory clarity under Europe's MiCA framework to integrate digital assets into mainstream banking services.

• Expect others to follow. Clarity = momentum.

🌕 Moonpay Acquire Iron for $100m

Key Points:

• MoonPay has acquired Iron, an API stablecoin infrastructure startup, in a deal worth over $100m.

• MoonPay can enable its existing business customers to accept and send stablecoin payments. 

• Previously, MoonPay was focused on enabling seamless consumer on-ramps and off-ramps into crypto.

🔈️ The Tokenized Take:

• On-ramps are becoming invisible: In the last cycle “buying crypto” was the goal, now that is becoming invisible to users and lower friction.

• The battle to be the Braintree vs Stripe of Crypto: MoonPay's strategic acquisitions position it to become the "Braintree of crypto," offering a wide range of solutions to its customers for crypto and stablecoin on/off ramps and payment processing.

• Further momentum: This follows the Mesh Series B of $82m, and of course the enormous $1.1bn acquisition of Bridge by Stripe.

📰 Some More News:

• Japanese Bill Plans to Expand Stablecoin Assets 

• Coinbase Secures Registration in India

• Former JPM Digital Asset Lead Oli Harris Raises $3m to transform Real Estate with Blockchain (Pssst… check out our podcast with Oli here!)

• Avalanche Foundation Launches Visa Credit Card for IRL Payments (Check out Tokenized co-host Cuy Sheffield talking about it here!)

• Figure Markets is offering the first SEC-registered public security yield-bearing USD stablecoin

• Goldman Sachs acknowledges cryptocurrencies in annual letter

Stablecorner ⚖️  → Stablecoins Hit All-Time High Supply; Here are the 8 ways banks can make money from them

Stablecoin supply has hit all time high, whilst crypto markets are bleeding.

Some of this of course is a direct result of the crypto market declining, as traders and speculators flock to safe havens. 

However, this is also a feature, not a bug.

Onramping to crypto isn’t flawless, and going from stablecoins to crypto, is much easier than fiat-to-crypto. That will likely change, and very quickly – with banks looking to provide crypto products to their customers – and onramps will generally improve. But right now, going to stables is easier. 

Stablecoins are no doubt all the rage in industry as well, with almost every big bank, payments business and fintech discussing internally; what is our stablecoin strategy?

On a recent episode of Tokenized with Nick Philpott, Co-Founder of the Standered Chartered Subsidiary Zodia Markets, he broke down 8 ways Banks can make money from stablecoins:

1. Banking Services - Provide traditional banking services to stablecoin issuers (like Standard Chartered does for Circle).

2. Custody Services - Custody the treasuries that back the stablecoin reserves.

3. Treasury Brokerage - Broker treasuries to the reserve manager of the stablecoin.

4. Repo & Reverse Repo - Offer repurchase agreements for the reserve manager.

5. Cash Buffer Income - Generate income from the cash buffer needed for minting and burning operations.

6. Payment Income - Earn fees from minting and burning transactions with firms that can interact directly with stablecoin issuers.

7. FX Trading - Generate revenue from foreign exchange trades when stablecoins are exchanged against foreign currencies.

8. Custody Business Revenue - Earn revenue through stakes in custody companies that handle the digital assets.

Simon’s Market Read Out 💬 

Tweet of the Week 🐤 

From Pete Schroeder (Circle) and Max Von Wallenberg (Iron)

(Yes, we’re refusing to call them Xeets…)

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Disclaimers