Last week's White House crypto summit, which was during the week of January 27, I saw everyone sharing the press release, talking about 'breaking the ice between banks and crypto giants' and 'building a compliant future together,' which made me very sleepy. To be honest, if you really believe those formalities, this bull market will probably be handed over to the main players again.
I also dug up some details from this closed-door meeting, especially what Coinbase, Ripple, and a few others discussed sitting at the same table as the American Bankers Association (ABA). On the surface, they talked about legislation, but in reality, it was all about splitting the cake, with one core word: stablecoin profits.
Don't be fooled by those lofty terms. The essence of this matter is very simple: the banks are getting anxious. Just think, if Coinbase or any on-chain protocol can legally offer users a 5% yield on $USDC, who would still keep their money in JPMorgan for that 0.01% interest? This directly threatens the core 'deposit' cheese of traditional banks.
So, this so-called 'Crypto Czar' at the White House bringing both sides together is not really for the benefit of retail investors, but rather the banks are forcing regulation: either stablecoins cannot offer interest, or only banks can issue this interest. This is the real knife-edge behind this meeting.
What does this mean for the chips we hold?
First of all, don't expect $BTC to surge immediately due to this meeting. This kind of top-level game is long-term, and the market is currently more concerned with liquidity release. However, once legislation regarding 'stablecoin yields' is established, if it is favorable for the crypto sector, then the DeFi sectors in the $ETH and $SOL ecosystems will definitely experience an epic explosion. Because that would mean on-chain assets officially possess a 'legal weapon' to compete with traditional bank deposits.
Conversely, if the final compromise results in 'only licensed banks can issue stablecoins that provide yields', then this positive news would be significantly diminished, commonly referred to as being 'co-opted'.
I find the current market quite interesting. After the news broke, $BTC didn't fluctuate much; instead, several tokens in the RWA sector are subtly moving, indicating that smart money is already betting on the outcome.
For us traders, we must not trade based on news headlines. This White House meeting is a signal that Crypto has transitioned from being a 'fringe gamble' to a competitor of 'core financial assets'. It's the same logic: when the enemy starts trying to constrain you with rules, it means they are really scared.
This matter is likely to end with both sides taking a step back, but for decentralized stablecoins, the restrictions will only tighten. In the coming months, keep an eye on the details of the stablecoin bill in the House of Representatives, which will be the key factor in determining whether the altcoins in your hands can outperform $BTC.
If stablecoin interest were truly opened up, would you move your deposits on-chain? Let's discuss in the comments.