E51｜Stablecoin Battle: Circle's rise and the competition between new forces entering traditional finance

As the US Genius Act continues to advance, the competition for stablecoins has become fierce: On the one hand, it is the competition between the compliant stablecoin USDC and the non-compliant stablecoin USDT in the crypto market, but as global stablecoins are compliant, whether USDT can continue to maintain its existing leading position is related to the battle of the entire stablecoin pattern; on the other hand, global consortiums such as JPMorgan Chase, Bank of America, Wells Fargo, and Citibank have begun to form alliances to discuss the issuance of stablecoins for stablecoins; at the same time, Silicon Valley financial technology giants Stripe and Paypal have been vigorously betting on stablecoins; in politics, political capital such as the Trump family, US Secretary of Commerce Howard Lutnick and the Abu Dhabi royal family have also entered the market and become a key variable in this stablecoin war. In this episode, we start with the listing of the first stablecoin stock and the USDC stablecoin issuer, Circle, and try to disassemble the hottest and core issues discussed in the stablecoin industry: - Why is Circle so popular to list, with a rise of nearly 4 times in two days? - Coinbase's full support is the key to Circle's rise? Key contract origin, risks and detailed terms that test Circle's future profitability - New variables brought by the entry of politics and big capital: What are the six centralized stablecoin alliances for traditional finance? - The double overlap between macro environment and accidental factors: the starting volume of USDC, the two rapid growth periods and the critical moment of being close to a major defeat - The same stablecoin business: Why is the profitability gap between USDC and USDT huge? - With the support of policy, the two core directions and key strategies for the development of stablecoins [sponsor] This episode is sponsored and broadcasted by the open source hardware wallet OneKey. Hardware wallets are one of the most effective ways to protect crypto assets. The crypto world is a dark forest, and everyone is responsible for their own assets. A physically isolated hardware wallet can better protect mnemonics from being stolen. Visit OneKey: https://shop.onekey.so/discount/web3101 Purchase an open source hardware wallet and use the discount code "web3101" to enjoy a 95% discount. If you want to know about OneKey, you can jump to the show 07:56. [Anchor] Liu Feng: Web3 101 Manager, BODL Ventures Partner, Former Editor-in-Chain News Hongjun Jane: Founder of Silicon Valley 101, Podcast Manager [Guest] Can Sun: Co-founder of Backpack Exchange, head of legal compliance Zheng Di: Frontier Technology Investor [You will hear] Circle's listing soars: Digital US dollar reconstructs the financial settlement pattern 03:56 Why is Circle popular: Digital US dollar redefining Wall Street and Finance 05:34 The US Genius Act promotes: 2 trillion in 3 years, the scale of the stablecoin market has skyrocketed by 12:05 The regulatory details of the Genius Act are relatively clear, but it is a big test for the industry giant Tether Circle's history of making a fortune and transformation: from the multi-disciplinary defeat to focusing on stablecoins 16:02 The first batch of stablecoins in the industry in 2018, USDC came into being 17:53 Circle's three major businesses before stablecoins: wallets, exchanges, and over-the-counter trading 21:16 2019 cryptocurrency winter hero cut off his arm: cutting off all other businesses "binding curse": Is Circle and Coinbase considered an "unequal treaty" 24:52 The beginning of the story: Circle and Coinbase launched a joint venture in 2018 31:03 Coinbase's strong endorsement is very worthwhile: liquidity is the biggest challenge for stablecoins 33:53 Renegotiation in 2023: The two details of the prospectus agreement dismantled repurchase and cooperation details 35:42 Revenue exceeds 56% paid to Coinbase: pay Coinbase $900 million, Binance only $60 million 36:44 Why does the Genius Act not allow stablecoin issuers to pay interest to users? Preventing the bank from bankruptcy 37:23 The big hidden dangers of Circle and Coinbase: Is joint promotion considered disguised interest payment? 39:11 Six centralized stablecoin alliances with traditional finance entering 44:29 Circle's biggest hidden danger - Can it get rid of the legal details of the Coinbase agreement interpret the rise of USDC: ups and downs and downs 48:50 Key nodes for changes in USDC issuance - 2020 launch - 10 times growth of DeFi Summer in 2022 - 2023 Silicon Valley Bank Breaking + Suffocation 2.0 (Operation Choke Point 2.0) - A new round of policy positives at the end of 2024 57:08 Coinbase's full support is the key to USDC's increase of 59:38 If the Federal Reserve had not saved Silicon Valley Bank, USDC would have been out of the way 1:00:55 The difference between USDT and USDC blockchain distribution: Justin Sun's tide accounts for more than half of the USDT volume, which is also stablecoin business: Why is the profitability gap huge 1:02:34. Comparison of reserve funds: USDC structure is like Yu'ebao; USDT's 18% non-compliant reserve funds earned 50% of revenue 1:03:46. "TEDA is the largest lending institution in the entire blockchain world" 1:08:35. Promotion or back-payment: The market's top and runner-up difference is huge. The core strategy of stablecoin competition is 1:09:24. USDC's compliance path: huge, but its long-term competitiveness may exceed Tether 1:13:38. The dilemma and core of stablecoin in traditional financial institutions: distribution + liquidity 1:14:07. The stablecoin market winners take all? 1:15:18 The future expansion path of stablecoins: touch consumers through ToB scenarios + on-chain transactions 1:22:21 Inflation and currency depreciation in Turkey and Africa have stabilized 1:24:59 Don’t educate users, but quietly embed them into the existing financial system [Related podcasts] https://www.youtube.com/watch?v=MNMYB_gseTQ https://www.youtube.com/watch?v=SmWu3kNgqUo [Later] AMEI [BGM] Mumbai - Ooyy Estimations - Christoffer Moe Ditlevsen [Find us here] Listening channel: Apple Podcast｜Spotify｜YouTube｜Xiaoyun Contact Us: podcast@sv101.net