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Hindustan Times
12 hours ago
- Business
- Hindustan Times
Crypto gets stability with a GENIUS Act
Last month, I met two Lebanese women at a conference overseas. They were accompanying their businessmen husbands. We got talking and I found that they keep their money mostly abroad or in dollars and euros in cash at home. In 2019, the Lebanese government froze bank accounts, effectively locking over $93 billion of citizens' money and making it inaccessible. Therefore, when I read that the US has given stablecoins a formal legal backbone, it seemed that a giant step has been taken in legitimising a particular form of crypto currencies that finally have a use case, especially for people in countries with unstable governments and those with hyper-inflation. Let's get the basics out of the way first. A cryptocurrency is a specific type of digital token that is designed to function as a medium of exchange or store of value using blockchain to record transactions. Bitcoin is the most well-known example. Cryptocurrencies have two major problems. One, there is no underlying asset. Remember that a fiat currency has the promise of the government to honour the value as an underlying asset. Stocks have businesses and bonds have a loan contract as underlying assets with a value. But cryptocurrencies have no asset or promise that gives them value. Two, there are no rules of the game as these have been outside the regulatory gaze. This has encouraged all kinds of frauds to perpetuate. Over half the cryptocurrencies have failed since 2021, with billions of dollars lost by people gambling on a quick return. The emergence of stablecoins over the past few years solved the first problem. A stablecoin is a type of cryptocurrency that has an underlying asset — typically the dollar or a US government bond. The second problem is bad faith actors, like exchanges and issuers of these coins who can either embezzle customer money (like FTX did) or simply not buy the required asset causing an asset liability mismatch in the future. In the absence of road rules, the market has been the Wild West revisited. The GENIUS Act that US President Donald Trump signed into law on July 18, 2025, attempts to put down some rules of the game. It mainly solves for customer protection through three key provisions. One, stablecoin issuers must have a 100% reserve backing with liquid assets (like US dollars or short-term treasuries). Two, they must make monthly public disclosures about their reserves. Three, they are forbidden from making misleading claims that their stablecoins are backed by the US government or are federally insured or are legal tender. A privately issued stablecoin is not a fiat currency. So, what's the use-case? The Lebanese women I met might be among the first to begin using a dollar-backed stablecoin to hold their money because they no longer trust banks in their own country. They might not know it today, but in a year, they will be using some form of a stablecoin to keep their money safe in their home country. Expand this story to countries with weak governance, weak macros, hyper-inflation, dictatorships, and persistent political instability, and you see a huge market for a trusted stablecoin. While distressed-country use of stablecoins will be the first large customer base, a widening ripple will be in international money transfers and remittances. Personal international remittances are a $740 billion a year flow. Business flows are a multiple of this. These are expensive given the global average cost for retail of sending remittances is just over 6% as of March 2025. While this is the average, in some places, the costs can be as high as 20% for small amounts. When the time taken to do the paperwork is included, the costs of using banks and other safe ways to transfer money abroad are very large. A trusted, low-cost stablecoin issuer backed either by the dollar or US government bonds will slowly replace other ways of moving money across borders. Safety, trust and cost will be the three variables that will make regular remitters change over to the use of stablecoins over time. So, will banks lose all this business? I'm going to make some predictions here. I see some banks and other trusted names in global finance using their trust to set up global payment systems based on a stablecoin framework. They will either buy out the existing players — Tether being the largest today — or issue their own coin with their own branding. Banks that are forward looking will do it fast and though it will cut their margins, they will at least still be in the game. I also see the demand for the dollar and US government bonds stabilise over time as the US asset-backed coins gain acceptance reinforcing the dollar-first global payment system. It will be imperative in the first few years that there are no major blowouts of a global stablecoin issuer. What does it mean for you and me? At the moment — nothing. India is not a country that is at risk of hyper-inflation. Nor will private assets be frozen unless there is a drastic change in the political viewpoint where private assets are at risk of being shared for a more 'equal' country. Our use case for stablecoins will be purely cheaper and faster remittances and not as a distress store of value. And even then, the use-case is only after a trusted name has proven its track record over time. I would not rush into using it just yet. Should you invest in these stablecoins? Unless you invest today in the foreign exchange markets, there is no justification to do so in a stablecoin. We need to understand that the global financial system is changing. As tiny retail users, we should wait for the rules of the game to settle down before we enter this digital financial superhighway. Monika Halan is the best-selling author of the Let's Talk series of books on money. The views are personal.
Yahoo
3 days ago
- Business
- Yahoo
Crypto Still Seen as 'Risky' Among U.S. Investors Despite Ownership Surging 8x Since 2018: Survey
Cryptocurrency may be easier to buy than ever, but most Americans still want no part of it. A new Gallup survey found that just 14% of U.S. adults own crypto, a figure that has been growing but still represents a small slice of the investing public. The study, conducted in mid-June, revealed deep skepticism about cryptocurrencies. 60% of respondents said they have no interest in ever buying cryptocurrency, and just 17% admitted they're intrigued. Only 4% of respondents said they plan on buying crypto in the near future. Gallup also found that among U.S. investors owning more than $10,000 in stocks, bonds or mutual funds, 55% considered the asset class 'very risky.' Still, ownership rates skyrocketed from 2% in 2018 to 17%. This skepticism isn't surprising, despite the U.S. having a pro-crypto president and clearer regulations that have recently been rolling in. While the 2021 bull run ushered in extreme volatility and made crypto a mainstream topic, the subsequent brutal crypto winter, which saw many high-profile bankruptcies, such as FTX, as well as scams and exploits, soured retail investors' sentiment. Although crypto has since then seen institutional investors jumping into the market, helping it become more legitimate, many retail investors, burned by the past losses, are likely still staying vigilant. Four years ago, Gallup found that 6% of U.S. investors owned cryptocurrency. That figure has since risen but may be conservative, as a Fed survey revealed 12% ownership among U.S. investors. Diving deeper into the ownership, the demographic divide is stark. While one in four men aged 18 to 49 owns crypto, the survey found that ownership drops sharply among women and older adults. College graduates and high-income earners report above-average participation, but seniors and low-income households remain largely absent from the space, the survey shows. Knowledge gaps also persist. Nearly everyone surveyed had heard of crypto, but only 35% said they actually understood how it works. Familiarity was highest among younger men and the wealthier. Even among those who claim to understand crypto, most still call it a risky bet. Among U.S. investors, 64% see the asset class as 'very risky,' up from 60% in 2021. The survey found that about one in seven Americans owns crypto, while nearly six in 10 own stocks or real estate. Only 4% of adults said crypto is the best long-term investment.
Yahoo
6 days ago
- Business
- Yahoo
Binance adds USYC as Circle expands footprint of its yield-bearing stablecoin
Circle on Thursday announced that the world's biggest crypto exchange would begin accepting USYC, a type of stablecoin that shares yield with investors, as collateral from institutional clients. While the news will be of interest primarily to a niche subset of traders, the new arrangement is significant as another step in the rapid integration of the traditional and crypto realms of finance. Circle, a newly public company that is the world's second biggest issuer of stablecoins, acquired USYC as part of a larger acquisition in January. USYC stands out from most other stablecoins in that it is a tokenized version of a money-market fund and, unlike conventional stablecoins like USDC and Tether, it shares interest proceeds with those who hold it. According to Circle's chief business officer, Kash Razzaghi, the importance of USYC also lies in its appeal to institutional traders as a source of collateral. Many of these traders currently post money-market securities as collateral when they want to trade on crypto platforms like Binance. While this arrangement works well for purposes of trading, it is also cumbersome because it can take a day or more to settle a transaction—especially on weekends when the traditional financial system, which unlike crypto does not run 24/7, is closed. This is not the case when traders post USYC, Razzaghi explained, since the collateral can be instantly redeemed for its companion stablecoin USDC, which is fast becoming a practical alternative to traditional dollars. While many institutional traders who use platforms like Binance post collateral in Bitcoin or other crypto assets, some traditional organizations remain reluctant to do so. According to Catherine Chen, Binance's head of VIP and institutional, this is in part because the infamous collapse of FTX left many wary of leaving collateral on an exchange. Chen added that Binance has sought to address this concern with an offering called Banking Triparty that involves the company working with traditional banks to let them act as custodians, and post assets held at the bank as collateral for crypto trading. She added that many of these same partners are working with Binance on integrating USYC, which would provide for faster settlement. On Thursday, Binance also announced that it would likewise be integrating cUSDO, another yield-bearing stablecoin; cUSDO (a.k.a. OpenEden OpenDollar) is issued by OpenEden Digital, a Bermuda-licensed and regulated entity. This story was originally featured on Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Yahoo
6 days ago
- Business
- Yahoo
Chapter 11 bankruptcy firm to pay $1.9 billion to creditors
Chapter 11 bankruptcy firm to pay $1.9 billion to creditors originally appeared on TheStreet. FTX, the crypto exchange that went bankrupt in November 2022, announced on July 23 that the record date for claim holders is Aug. 15 and it will begin the next round of creditor claim distribution on Sep. 30. The exchange also said that the bankruptcy court has lowered the disputed claims reserve from $6.5 billion to $4.3 billion — a reduction of $1.9 billion. It means these funds, not considered disputed claims anymore, can be distributed among claim holders in the upcoming batch. FTX is required to distribute $14.7 billion to $16.5 billion among the claimants out of which it has already paid $6.2 billion in two previous batches: $1.2 billion in February and $5 billion in May. The third batch of distribution is expected to be overseen by BitGo, Kraken, and Payoneer. Notably, the FTX Recovery Trust requested the court in early July to dispute claims from 49 restricted jurisdictions, including China, Russia, North Korea, and Saudi Arabia, on the ground that crypto trading is allegedly illegal in these countries. The move drew intense criticism from former FTX users residing in these jurisdictions. Founded in 2019, FTX was the third-largest cryptocurrency exchange by volume at its peak in July 2021. However, as depositors got a whiff of potential fraud at the exchange, they began withdrawing their funds. The exchange filed for Chapter 11 bankruptcy in November 2022. The court found the firm's founder Sam Bankman-Fried guilty of seven counts of fraud and sentenced him to 25 years in prison and penalized him $11 billion in forfeiture. Chapter 11 bankruptcy firm to pay $1.9 billion to creditors first appeared on TheStreet on Jul 24, 2025 This story was originally reported by TheStreet on Jul 24, 2025, where it first appeared. Sign in to access your portfolio
Associated Press
6 days ago
- Business
- Associated Press
Safeguarding Users' Assets: BTCC Reports Total Reserve Ratio of 132% For July, ETH Leads At 170%
By Meg Flippin Benzinga DETROIT, MICHIGAN - July 24, 2025 ( NEWMEDIAWIRE ) - BTCC, one of the world's longest-serving cryptocurrency exchanges founded fourteen years ago, had a total reserve ratio of 132% for July, marking the fourth month in a row in which it maintained reserves well above 100%. The reserve ratio is the amount of customer funds the exchange holds in reserve compared to the amount of customer funds deposited. It measures the exchange's ability to cover withdrawals by customers. The higher the reserve ratio, the greater the exchange's ability to meet withdrawals; the lower the reserve ratio, the higher the risk the exchange could run into trouble. BTCC, which prides itself on transparency, has been releasing Proof of Reserves (PoR) reports since April, and reserves have been above 100% in every month since then. Safeguarding Users' Assets Proof of Reserve is an audit procedure that verifies assets held by exchanges through cryptographic proof, public wallet ownership checks and repeated audits, reports BTCC. Custodians provide transparent proof that on-chain reserves truly exist, demonstrating that the total tokens held and freely available on the platform are greater than or equal to the total token assets of all users. In centralized trading platforms, each user's assets are recorded through a ledger in a database. Securely proving that the platform is properly safeguarding all users' assets is a challenge that each platform must address. BTCC uses Merkle tree tools to verify platform reserves and user asset proof reports, allowing users to verify their assets within the platform. Being able to verify the assets can give users peace of mind that their assets are safe. Several cryptocurrency exchanges have gone under over the years, including FTX and BlockFi, resulting in large losses for customers. In April, BTCC reported that the ratio was 161%. In May, the figure was 152%, and in June, it was 135%. Ethereum Leads The Way In the latest PoR report, BTCC said the exchange had strong asset backing across all major cryptocurrencies, with Ethereum showing the highest reserve ratio at 170%. Bitcoin, the world's leading cryptocurrency, has a reserve ratio of 120%, while XRP has a reserve ratio of 145% and Tether has a reserve ratio of 143%. USD coin ended the period under review with a reserve ratio of 110% while Cardano had a reserve ratio of 120%. BTCC said the strong reserves across all the digital coins demonstrate the exchange's commitment to maintaining sufficient reserves 'July has been a remarkable month for the cryptocurrency market,' said Alex Hung, head of operations at BTCC Exchange. 'Rising geopolitical tensions and new US tariff policies have driven increased safe-haven demand, with Bitcoin breaking through the historic $120,000 milestone for the first time. Throughout this period of market volatility, BTCC has maintained its strong financial position while continuing to grow both our asset base and user community.' BTCC: Standing The Test Of Time With Zero Security Incidents BTCC is one of the world's longest-serving cryptocurrency exchanges, founded in June 2011, providing crypto futures trading services to users worldwide. The exchange offers perpetual futures on over 390 crypto and spot trading on more than 300 currencies, including BTC, ETH, DOGE, LTC, SOL, XRP and SHIB. The cryptocurrency exchange adopted industry-leading security standards early on, which it credits with zero security incidents since its inception fourteen years ago. As of April, BTCC has over 9.1 million registered users around the world. For the second quarter, BTCC reported a volume of $850 billion in futures trading. Crypto exchanges come and go but BTCC has been able to stand the test of the time, thanks to its security, transparency and ability to safeguard customers' assets. With reserve ratios that surpass 100% for consecutive months, BTCC is demonstrating why it's one of the world's longest-serving cryptocurrency exchanges. Featured image fromShutterstock. This post contains sponsored content. This content is for informational purposes only and is not intended to be investing advice. This content was originallypublished on further disclosureshere. View the original release on
