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Coinbase Targets USDT Stablecoin Rival Tether With an $86 Billion ‘Stretch Goal’ for USDC

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Coinbase CEO Brian Armstrong said Thursday that the crypto heavyweight is taking off its gloves for a renewed fight in the stablecoin ring.

During the company’s fourth-quarter earnings call, Armstrong said the firm will aim to challenge Tether’s position as the industry’s reigning stablecoin issuer. The ultimate goal is to make Circle’s USDC the world’s “number one dollar stablecoin.”

Armstrong characterized this new aim as a “stretch goal,” signaling it represents an ambitious yet potentially achievable feat, which will nonetheless push Coinbase outside its comfort zone.

As the second largest stablecoin, USDC’s market cap stands at $56 billion after hitting an all-time high last week. Still, that leaves a lot of ground for USDC to cover as it works to overtake Tether. As of this writing, USDT currently accounts for a hulking 60% of the stablecoin market at $142 billion market capitalization, per CoinGecko.

Because stablecoins are designed to maintain a 1:1 peg with another currency, in this case the U.S. dollar, the market capitalization tends to be a reliable indicator of issuance.

Coinbase CFO Alesia Haas contextualized Armstrong’s bold call on Thursday. “I think it’s important to note that we hope to achieve this over the next few years,” she said.

The high bar for Coinbase comes after its stronger-than-expected fourth quarter was marked by $1.3 billion in profits. Meanwhile, stablecoin legislation appears to be gaining momentum on Capitol Hill, after years of quibbling among lawmakers.’

Sen. Tim Scott (R-SC), Senate Banking Committee Chairman, has already pledged that legislation covering stablecoins will be passed within the first 100 days of President Donald Trump’s term.

That bill, dubbed the GENIUS Act, would create a pathway to legality for issuers of U.S. dollar-backed stablecoins. That would include sharing monthly audits on the health of the fiat reserves backing their products, according to a draft of the bill seen by Decrypt.

Since lawmakers may end up modifying the stablecoin bill before it can be passed through both chambers of Congress and signed into law by Trump, how sweeping stablecoin legislation could ultimately impact USDC, USDT, or any stablecoin remains unclear.

Can legislation help?

Hours before Coinbase’s earnings, JP Morgan analysts posited that Tether may be forced to change the structure of the dollar-equivalent reserves backing USDT.

In its most recent attestation report, Tether said those reserves consist mostly of cash and cash equivalents and other short-term deposits, including assets like U.S. Treasuries and money market funds, which account for 82% of Tether’s reserves.

For years, Tether has sporadically and then more regularly published attestation reports about the reserves that back its stablecoin. But accountants and competitors alike have been quick to point out that none of those financial statements have been audited.

While audits seek to uncover risks and potential compliance issues by gathering data, attestations are typically used to authenticate how truthful data is. 

But it is worth pointing out that, as of this writing, Circle also has never published an audited report on the reserves backing USDC. Like Tether, the company publishes attestations about the “highly liquid fiat reserves” backing USDC and EUROC, its Euro-backed equivalent.

JP Morgan posited that Tether may have to sell a significant sum of “non-compliant” assets in its reserve, like Bitcoin and any remaining commercial paper, if it wants to comply with new U.S. rules.

A Tether spokesperson pushed back against JP Morgan’s suggestion, telling Decrypt that $20 billion in “other very liquid assets” had been overlooked by the Wall Street titan, along with “more than $1.2 billion in profits per quarter” from holding swathes of government debt.

Notably, Tether may also fall outside the stablecoin bill’s scope; the company recently relocated its business from the British Virgin Islands to El Salvador.

“If stablecoin regulation passes in the U.S., I do think it will disproportionately help USDC gain market share,” Bitwise Senior Investment Strategist Juan Leon told Decrypt. “But will that be enough to surpass USDT?”

USDC would have to become the predominately used stablecoin in developed markets for it to have a chance at surpassing USDT, Leon said. USDC is less likely to be able to displace USDT’s dominance in emerging markets, he added.

Former SEC Chair Gary Gensler once referred to stablecoins as “poker chips” used in decentralized finance, or DeFi, as a common way for traders to easily park funds and lock in gains. Remittances and payments represent real-world use cases, while the use of stablecoins in money laundering and sanctions evasion has also drawn controversy.

‘Accelerating’

On-chain activity involving stablecoins is largely concentrated on networks that support smart contracts, like Ethereum and Solana. But Armstrong said growing USDC’s footprint on the Ethereum scaling network Base—which Coinbase itself created and launched—is key, along with fostering commercial partnerships.

“We think USDC has a network effect behind it, and the compliant approach that they’ve taken, I think, is going to be really defensible long term,” Armstrong said, referring to Circle.

“We’ll be accelerating the market cap growth of USDC with more partnerships, and leaning into new use cases like adding payments support across our product suite,” he continued.

Stablecoin revenue totaled $224 million in Coinbase’s fourth quarter, falling $20 million from the previous quarter and representing just 9.4% of the company’s total sales.

In its shareholder letter, Coinbase described USDC as “the fastest growing ‘major’ stablecoin in 2024,” while pointing to $12 billion in on-chain USDC payments that the exchange facilitated.

Coinbase is taking an offensive approach to growing USDC now. But during the bear market in 2023, when trading volumes lagged, the company saw stablecoin revenue bolster its subscriptions and services segment.

In fact, subscriptions and services revenue temporarily surpassed transaction revenue as Coinbase’s main money maker, totaling $334 million and $289 million, respectively, in the third quarter of 2023.

In August of that year, Circle said Coinbase had taken an equity stake in the firm. Both companies agreed to shelve a “self-governance consortium” to better hone their alignment.

Circle and Tether did not immediately respond to requests for comment from Decrypt.

Edited by Stacy Elliott

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GameStop Approves Adding Bitcoin To Treasury Reserves

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GameStop Corp. (NYSE: GME) announced that its board of directors has unanimously approved an update to the company’s investment policy, allowing Bitcoin to be held as a treasury reserve asset. The decision follows a series of engagements between GameStop Chairman and CEO Ryan Cohen and prominent figures like Michael Saylor in the Bitcoin industry.

On February 8, Cohen met with Strategy Chairman and well-known Bitcoin advocate Michael Saylor, sparking speculation that GameStop may be adding BTC to its balance sheet. A couple weeks after, Cohen responded to CoinDesk via a tweet stating “Letter received.” after receiving a letter from Strive Asset Management CEO Matt Cole, which urged GameStop to adopt Bitcoin as a reserve asset.

In its announcement, GameStop noted that its investment policy now permits investments in “certain cryptocurrency assets, including Bitcoin and U.S. dollar-denominated stablecoins.” The company also acknowledged associated risks, including the potential impact of these investments on its financial results and internal financial controls.

The policy update was disclosed alongside the company’s financial results for the fourth quarter and full fiscal year ended February 1, 2025.

For the fourth quarter, GameStop reported net sales of $1.283 billion, a decrease from $1.794 billion in the same period the prior year. Selling, general and administrative (SG&A) expenses fell to $282.5 million, compared to $359.2 million in the fourth quarter of the previous year. Net income for the quarter was $131.3 million, up from $63.1 million a year earlier. Adjusted EBITDA for the quarter was $96.5 million, compared to $88.0 million in the prior year’s fourth quarter.

GameStop also disclosed that it held $4.775 billion in cash, cash equivalents, and marketable securities at the end of the quarter. The company completed its exit from Italy and finalized the wind-down of store operations in Germany during this period.

For the full fiscal year 2024, GameStop reported net sales of $3.823 billion, down from $5.273 billion in fiscal year 2023. SG&A expenses for the year were $1.130 billion, compared to $1.324 billion in the prior year. Net income for the year reached $131.3 million, significantly higher than the $6.7 million reported in fiscal year 2023. Adjusted EBITDA for the full year was $36.1 million, compared to $64.7 million in the previous year.

The company has not yet disclosed how much Bitcoin it plans to purchase or when it will begin acquiring BTC, and CEO Ryan Cohen has not yet commented publicly on the addition of Bitcoin to GameStop’s balance sheet at the time of publishing. 



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Cboe Exchange Submits Filing to List Fidelity Solana ETF

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Cboe has submitted a filing to the U.S. Securities and Exchange Commission that would allow the exchange to list shares of a Fidelity exchange-traded fund tracking the price of Solana. 

The19b-4 form, filed Tuesday, is a major step in the SEC’s approval process, although Fidelity must still file an S-1 registration statement describing the product. 

The filing comes just days after Fidelity registered a Delaware Trust entity for its Solana fund, which would be based on the performance of the sixth largest digital asset by market capitalization.  

The token was recently trading at about $145, up nearly 1.2% in the past 24 hours, according to data provider CoinGecko. 

Grayscale, Bitwise, Canary, 21Shares, Franklin Templeton, and VanEck have also submitted filings for spot Solana ETFs. Earlier this year, Bloomberg Senior ETF Analyst Eric Balchunas has penciled in a 70% chance that Solana ETFs would receive a green light this year, although he would not predict the timing. 

Those applications are part of a deluge of proposed altcoin funds, including XRP, Dogecoin and Cardano, that have followed the wild success of spot bitcoin ETFs, which have generated more than $35 billion in net inflows since their approvals starting last January, and more muted achievements of spot Ethereum funds. 

Fidelity’s Wise Origin Bitcoin Fund has received about $11.5 billion in net flows in its more than 14 months of existence, the second most among the spot bitcoin funds. 

According to a CoinShares report, crypto-backed investment products generated $644 million in net inflows last week following five consecutive weeks of outflows. The rebound was largely driven by inflows to products based on Bitcoin, followed by Solana-based offerings. 

Edited by James Rubin

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Circle Deepens Japan Commitment as SBI Group Prepares USDC Launch

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Circle Internet Financial, the Boston-headquartered U.S. firm behind the USDC stablecoin, is deepening its ties to Japan’s burgeoning digital assets market.

Japanese SBI VC Trade, a crypto exchange operating as a subsidiary of SBI Holdings, a major internet-based financial conglomerate in the country, is expected to play a key role in Circle’s commitments in Japan.

After receiving regulatory approval earlier this month, SBI VC Trade now plans to leverage USDC in Japan, marking the first token of its kind approved under Japan’s stablecoin regulatory framework.

Circle has established a Japanese entity, Circle Japan KK, to support the stablecoin’s local operations. SBI VC Trade is set to launch USDC trading on March 26, 2025, the pair announced Monday. 

Domestic exchanges Binance Japan, Bitbank, and BitFlyer also plan to list and distribute USDC in the near future, per the statement.

Circle co-founder and CEO Jeremy Allaire said on X the development would unlock “tremendous opportunities” for Japan’s digital assets markets, powering payments, cross-border finance, commerce, and FX, among other use cases for USDC.

The approval builds on a partnership between Circle and SBI Holdings that began in 2023, combining USDC distribution with banking and Web3 technology for the Japanese market.

USDC is fully reserved and backed 100% by cash and cash-equivalent assets, with reserves held at regulated financial institutions that publish third-party monthly attestations, according to documentation from Circle.

It also goes beyond just introducing a new crypto product in the country, Jay Jo, a senior research analyst at Tiger Research, told Decrypt.

Once launched, besides the usual listing and trading on exchanges, Japanese companies could “offer custody services and develop various stablecoin-based businesses,” Jo explained.

While the country “still prohibits trust-based yen stablecoins,” future regulatory developments could help shape where its crypto and digital asset sector could go, Jo said.

However, the continued depreciation of the Japanese yen could create market dynamics, given the current tensions between it and the U.S. dollar.

If the yen shows sustained weakness, “Japanese investors might shift to USDC” as a hedge and potentially “increase selling pressure on JPY,” Jo added.

“Easier access to dollar-denominated assets” could lead to accelerated outflows from traditional yen investments, Jo said. This could happen “especially if interest rate differentials remain wide.”

Edited by Sebastian Sinclair

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