WEEKLY - banks + stablecoins
plus, agentic web models, the decline of surveys and more
Hello everyone, I hope you’re all doing well and gearing up for what will no doubt be an intense summer! No? Me neither, it feels way too soon…
You’re reading the free weekly Crypto is Macro Now, where I reshare/update a couple of posts from the week, offer some interesting links I came across in my weekly reading, and include something from outside the crypto/macro sphere that is currently inspiring me (it’s a fascinating world out there).
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In this newsletter:
Stablecoins, banks and signals
Assorted links: new agentic web models, the Convenience Economy, why do we need ratings agencies, and a lot more
The humanity and atmosphere of food
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Some of the topics discussed in this week’s premium dailies:
Coming up: negotiations, G7, housing and more
Moody markets
Europe’s elections: the far-right advances
Macro-Crypto Bits: geopolitics, sentiment, tariffs and more
Good news for stablecoins and crypto
Foreign buyers of treasuries
Macro-Crypto Bits: markets, JPMorgan, gold, authoritarianism
When Bitcoin’s narratives merge
Debt issuance diversifies
Macro-Crypto Bits: the basis trade is back, foreign buyers of US bonds
Why Pizza Day matters
The easy but mistaken BTC narrative
A stablecoin bill passes
Macro-Crypto Bits: jittery markets, currency agreements and more
Stablecoins, banks and signals
Podcast notes: Anas Alhajji on why energy prices are likely to climb
Macro-Crypto Bits: tariffs and markets, yikes
Stablecoins, banks and signals
If I had a nickel for every time I’ve been told “banks don’t like to change”, well, I’d have many nickels. I wouldn’t necessarily use them to buy bank stocks, but any skim of headlines over the past few months will highlight just how fast banks are adjusting to the wave of financial innovation triggered by the emergence of a new way to record and distribute data. This started slow many years ago – I remember when you could count the number of suits at a crypto conference on two hands. Now, they would probably outnumber the hoodies if it weren’t for radical changes in dress codes.
The pace of change is certainly picking up. Earlier this week, the Wall Street Journal reported that some of the largest banks in the US, including JPMorgan, Bank of America, Wells Fargo and others, are contemplating forming a consortium to launch a stablecoin.
Reactions to this have ranged from the victorious (“if you can’t beat ‘em, join ‘em”) to the ominous (“CBDCs through the back door”). As usual, both extremes are seeing what they are pre-disposed to see, while the real development hidden in the news is not about crypto nor is it about centralized digital cash. It’s about the evolution of banking.
So, while I generally don’t dwell on things that might happen, and the consortium is still only at the idea stage, this news is worth looking at more closely for what it says about the convergence of blockchain-based and traditional financial services.
What’s the goal?
First, each of the big three banks mentioned in the report has either already launched or investigated stablecoin services in some form. The consortium approach is new, and raises questions. Does this mean a joint stablecoin with a joint reserve pool? Or are they thinking of a tokenized deposit scheme with account reconciliation in the background? Or maybe a separate company jointly owned by the participating banks? If so, would banking compliance rules apply? If so, who would be responsible? Would banks be willing to share client data? How would a joint effort affect capital rules?
Second, the why is intriguing. As it happens, earlier this week I started work on a deeper dive into banks and stablecoins, as I’ve noticed the rhythm of news about banks looking into stablecoins is accelerating. A cursory glance at my growing list falls on names such as HSBC (which launched its tokenized deposit service on Thursday), Standard Chartered, Société Générale, ANZ Bank and many more.
One of my main theses so far is that all banks will either scramble to get ahead of what they see as an existential threat, or end up being acquired by those that do.
Most will sell the move as an embrace of innovation, with the priority of offering a better customer service – and that will be true. But underlying the uncomfortable nudge is the realization that banking is changing. Stablecoins are not the cause – rather, they’re more like a symptom. But they are also to some extent the catalyst for acceptance of that change.
In part, this is to do with the march towards a regulatory framework in the US and elsewhere that allows for bank stablecoin issuance, itself a big step forward for one of the most regulated and therefore slow-moving industries.
In part, it’s to do with the changing mix of banking revenue, which is becoming increasingly tied to the financial sector rather than the “main street” economy, and in which the weight of digital payments is becoming heavier.
And it’s also to do with the rapid development of stablecoin services from non-banks such as Circle, Stripe, Visa, Mastercard and more. Put differently, the product is out there, it is being used, and it is diverting payments business away from banks. As platforms enable simple user interfaces in more jurisdictions, familiarity with the speed and low cost will spread, and use will grow. Unless banks compete.
The thing is, can they, really? They have size, customer relationships and official support in their favour. In theory that would give them a head start as well as the heft of institutional legacy and regulatory protection. But those characteristics also make banks less agile than other innovators. Their compliance requirements are more costly and usually designed by bureaucrats who don’t care much about user convenience. These could deter retail customers who are also perhaps concerned about financial industry surveillance and fees.
But retail payments are perhaps a part of the market banks are willing to cede to other platforms, who will themselves work with banks but as institutional clients. In other words, banks moving into stablecoins is likely to end up being less about continuing to dominate payments, as it is about broadening the suite of institutional services.
Bigger changes
That suggests the end result could be a more fragmented landscape, at least at first – greater choice is arguably good for users, who will eventually consolidate around a handful of market leaders. Meanwhile, institutions get improved treasury management and accelerated settlement, making capital more efficient. Banks get deeper relationships with institutional clients, including those that service retail users.
In the end, the use of blockchain rails is not the news here. Rather, it’s banks rethinking a core tenet of their business. This is positive, for finance and for the crypto ecosystem, but those crowing that banks are “joining the revolution” misunderstand what banks care about: service, and justifying their moat.
The news is also not about banks “taking over”. In crypto, there will always be choice, and any attempt to mandate use of one token over others will be met with resistance in a field awash with tokens and applications, with new ones always in the pipeline. Banks will offer stablecoins that will be more centralized and monitored than some others, and they will be used by those more interested in convenience and compliance than decentralization. They will not be forced upon the rest of us, as that would be both ineffective and a political dead-end.
Meanwhile, in the background we will witness a re-think of why banks came to dominate payments in the first place, and how the term “payments” will change meaning as tokens become money and transactions become more the result of an activity than an action.
That’s the big news here: not banks embracing stablecoins, although that is interesting. No, it’s more about how we are getting ever-louder signals that finance is changing faster than we once thought possible.
ASSORTED LINKS
(A selection of reads outside of crypto and macro, although these may find their way in anyway. I try to choose links without a paywall, but when I feel it’s worth making an exception, I specify.)
Ben Thompson argues that the “original sin” of the world wide web is not, as some have suggested, the lack of payments – advertising-based content models are more human-centric, after all, which gave communities a chance to form without initial outlay, and creators the opportunity to monetize how they saw fit. But the old content models won’t work in the new world of AI:
Ad-based web models are dying as the shift of search from Google and others to AI models dries up the traffic flow
An agentic web is emerging in its place, with content “transactions” between agents replacing human interaction with ads
A big problem is that there is as yet no way to monetize these agentic interactions, and the absence of compensation for content creation could dry up creativity
Unless the new agentic distribution protocols include payment rails
Which is another realm for stablecoins: programmable and infinitely divisible (microtransactions)
This brings AI into the media evolution I’ve been hoping to see – community-based, focused on learning rather than consumption and on depth rather than breadth. (The Agentic Web and Original Sin, Stratechery)
Kyla Scanlon documents the Convenience Economy, and what it has done to both culture and our concept of “flourishing”. (Economic Lessons from the Screwtape Letters, Kyla’s Newsletter)
A wide-ranging interview with historian Niall Ferguson that covers the rise and fall of empires, the need for a new human philosophy for the AI era, the “other” coup of January 2021, the divisive power of networks, the political forcefield of religion and more. (America Is In A Late Republic Stage Like Rome, Noema)
Commissioner Hester Peirce lays out why crypto is a key part of the SEC’s priorities this early in the new Administration – it’s largely to correct the unjust enforcement-first approach of the previous SEC, and give more regulatory clarity to innovators, but it’s also so that the SEC can then move on to the many other things on its agenda. Plus, she explains why she thinks most crypto assets are not securities. (New Paradigm: Remarks at SEC Speaks, Hester M. Peirce)
Most of us know that survey response rates are dropping, and we’re not surprised. But we probably don’t know just how bad the situation is, what percentage of responses are now coming from bots, and what impact this will have on the “soft data” we use to gauge economic sentiment. Lauren Leek shares some startling facts, and offers some remedial suggestions. (The quiet collapse of surveys: fewer humans (and more AI agents) are answering survey questions, Lauren’s data Substack)
What is the point of ratings agencies? It’s their creation of the common language of credit risk: ratings don’t need to be accurate, they just need to be understandable. (Why credit ratings do (kinda) matter, FT Alphaville)
HAVE A GREAT WEEKEND!
(in this section, I share stuff that has NOTHING to do with macro or crypto, ‘cos it’s the weekend and life is interesting)
It’s been a while since I shared stunning photos with you, so today I will rectify that by featuring some of my favourites from the World Food Photography Awards 2025 – I prefer atmospheric to mouth-watering, and these capture the legacy and humanity behind feeding people. I hope you find them as moving as I do.
by Scott Goldsmith
by Diego Marinelli
by Shaolong Su
by Andrew Reiner
by Yu Chunshui
DISCLAIMER: I never give trading ideas, and NOTHING I say is investment advice! I hold some BTC, ETH and a tiny amount of some smaller tokens, but they’re all long-term holdings – I don’t trade.