WEEKLY - stablecoins, layer-1s, CME tokenization
plus: assorted links, summer music and more
Hello everyone, I hope you’re all doing well! Sigh, I am so not ready to say goodbye to summer. I know we have at least a couple of weeks left, but I also know that they are going to fly by.
If you’re interested in seeing ~daily photos of Madrid, Spain, in all its summer glory, plus the occasional crypto/macro thoughts and rants, follow me on X at @noelleinmadrid.
Next week I’m in Hungary for a wedding, and will have to skip next Saturday’s weekly summary. I’ll be publishing this Monday and Tuesday, though.
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You’re reading the free weekly Crypto is Macro Now, where I reshare/update a couple of posts from the past few days, 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).
In this newsletter:
Big-name payments-focused blockchains
Crypto adoption in high-inflation countries
Schwab’s stablecoin: why?
Assorted links: strong man culture, deeper than “why”, Belarus, social media gateways, simmering risk
Weekend: summer music
Some of the topics discussed in this week’s premium dailies:
Coming up: US CPI, PPI and retail sales, Alaska, China and more
What an end to the war could mean for markets
Another CBDC pivot
Macro-Crypto Bits: BTC’s move, reverse tariffs, China’s crypto stance
Big-name payments-focused blockchains
CME and tokenization
Crypto adoption in high-inflation countries
Macro-Crypto Bits: data, tariffs, BTC and gold
What even is CPI for?
Inflation is picking up
The market reaction
Make-or-break in Alaska: why it matters
Schwab’s stablecoin: why?
Macro-Crypto Bits: ETH’s moment, “long crypto” is back, NFIB signals
Big-name payments-focused blockchains
It’s starting to feel like “Layer-1 season”.
This week, we saw reports based on a now-deleted job posting that payments operator Stripe was building its own layer-1 blockchain called Tempo, together with VC firm Paradigm.
And, along with Q2 results, stablecoin issuer Circle unveiled Arc, a layer-1 blockchain expected to launch on testnet later this year. Details are slim, but it looks like Arc will connect clients across Circle’s ecosystem on a platform that can handle stablecoin transfers as well as FX and other market applications.
An obvious question, as always with this type of announcement, is “why?”.
One reason could be to ensure the development of features the ecosystem wants. For both Circle and Stripe, the priorities of most clients will probably be speed, cost and compliance – these are not necessarily the priorities of the Ethereum or Arbitrum communities, for instance.
Another could be to ensure low fees by controlling the system architecture.
But new layer-2s should be able to solve for that – Robinhood’s blockchain is being built as a layer-2 on Arbitrum, taking advantage of Arbitrum’s (and ultimately, Ethereum’s) security while customizing features for a tokenization-friendly platform. Kraken’s Ink layer-2 is based on Optimism’s technology. Coinbase’s Base layer-2 is also built on the Optimism stack, and today ranks as one of the most active networks.
Building a layer-1 from scratch is more expensive, will take longer, and will still have to earn the ecosystem’s trust on issues such as decentralization and security. For users of payment systems, though, that just want value to get from A to B as efficiently as possible, and that trust the operators of the network, perhaps that doesn’t matter as much as control and flexibility.
Crypto adoption in high-inflation countries
Last week, Bloomberg carried a report on the growing use of cryptocurrencies in Bolivia. Some cited examples:
After the 2014 central bank ban on crypto transactions was lifted in June of last year, payments in digital assets grew to around $300 million in H1 2025.
A top university pays its international faculty in Bitcoin.
A state-owned oil company was for a while authorized to use stablecoins for cross-border payments.
Some shops at the airport list prices in USDT.
Small businesses from coffee shops to fitness centres accept payment in BTC.
A local business leader is quoted as saying cryptocurrency use is high among importers.
Apart from the signal of a “mainstream” financial publication carrying a story like this, the reasons given for the growing use are intriguing, ranging from the economic to the ideological:
Dollars are in short supply – bank withdrawals are sometimes limited to just $100 per week.
Inflation is at a 34-year high of 25%.
Institutional trust is low.
And some prefer to transact in cryptocurrencies as a protest against “the system”.
What are the odds this recipe for growing adoption spreads to other developing economies?
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Schwab’s stablecoin: why?
In last month’s summer conference call, Charles Schwab CEO Rick Wurster dropped two big crypto-related announcements:
The firm will soon start to offer spot crypto trading.
There’s a stablecoin in the works.
The spot crypto trading is not news, this initiative was teased last November, and earlier this year a tentative launch date was given as April 2026. This was largely expected – the financial giant has offered various types of crypto industry exposure to clients since 2017, and in 2024 was one of the largest purchasers of the spot crypto ETFs on behalf of clients.
It’s a big deal, as Schwab – founded in 1971 – has over 37.5 million brokerage accounts, and $10.8 trillion in client assets. Many clients already have exposure via traditional vehicles – but offering spot trading should both boost fees and signal a deeper interest in ecosystem beyond traditional price exposure.
This could go some way towards explaining the second announcement. It’s not immediately clear why Schwab would want to issue a stablecoin, but the CEO was adamant: “We are going to have a stablecoin”. The firm is exploring doing so on its own, as well as with other banks in a consortium.
Why? Here it gets more complex.
One obvious reason would be to facilitate spot crypto asset purchases when that service is up and running. In theory, stablecoin balances could make trading and settlement more efficient – but fiat can work for that, especially when it involves rotating out of other assets in their Schwab portfolio (no actual transfers needed, just a ledger adjustment). Or, USDC could work just fine.
Then again, creating its own stablecoin would serve three strategic purposes:
Keep clients within the Schwab ecosystem.
Generate additional revenue from interest on the reserves, as well as minting/redemption fees.
Prepare for the convergence of crypto and traditional markets.
Schwab today earns a hefty amount of interest on client balances ($2.7 billion in Q1, almost half of total revenue) – sacrificing that by encouraging conversion into a third party token would not make economic sense.
What’s more, launching a stablecoin would enable it to get ahead of more focused competition from Robinhood, which recently announced a suite of onchain services including investment advice and cash management via its consortium stablecoin USDG.
Also, should Schwab one day decide to offer other onchain assets such as tokenized securities, an in-house stablecoin could facilitate settlement.
This is less convincing for now, however. Within a permissioned system, it’s not clear how much efficiency onchain settlement would add. Plus, the lack of regulatory clarity on definitions of tokenized settlement as well as price discovery and disclosures, at least for now, makes that a long way off.
What’s more, Wurster expressed some tokenization skepticism, pointing out that it’s not clear what problem it would be solving for. Greater liquidity and efficiency for tokenized securities are not a given. And more flexibility in trading windows? Schwab already offers 24/5 trading, yet only 1% of volumes are done outside of normal hours.
But, Wurster insisted, if it turns out that clients want tokenization, then Schwab will be there, and preparing for that eventually is probably one of the drivers of the stablecoin strategy.
Another possible reason is Schwab’s stake, together with Citadel Securities and Fidelity Investments, in institutional crypto exchange EDX Markets, which went live in 2023. An agreement with EDX to use Schwab’s stablecoin would not only broaden the use case and potential revenue for both; it could also facilitate multi-platform trading between Schwab, EDX Markets and Singapore-based EDX International which started trading last year. When there’s a reason for a token to leave a closed ecosystem, a stablecoin starts to make much more sense.
So, in sum, Schwab launching a stablecoin on the surface doesn’t make a lot of sense from the client’s point of view – the firm’s fiat onramps are convenient, as is the range of investment options. But if Schwab believes that traditional markets will be gradually moving onchain, getting the basic tools in place ahead of the industry stampede will enhance its already strong reputation for innovation.
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ASSORTED LINKS
(A selection of reads I came across this week that I think are worth sharing, not always about crypto or macro. I try to choose links without a paywall, but when I feel it’s worth making an exception, I specify.)
Marvin Barth points out that, while Trump’s negotiating and policy style may appear to be weakening America’s standing on the world stage, in many non-US cultures he is popular – a reminder that culture is complex and variable, but geopolitically important. (Values aren’t universal, but power is - Seriously, Marvin?!)
Brett Scott shares a deep, raw and also hopeful take on the pain of social media scrolling, which many hate but also have to contend with. Some interesting ideas in here. (How to turn your phone addiction into a ripped body, Altered States of Monetary Consciousness)
Simon Shuster – one of the few western journalists to be invited to interview Belarus President Alexander Lukashenko – shares previously unreported insight into the role Belarus has played in the evolving relationship between Russia and the US, and in the organization of the Alaska summit. (Exclusive: The Secret White House Backchannel That Paved the Way For Trump’s Summit With Putin, Time Magazine)
Packy McCormick dives into why we do what we do, and it’s not what you’d expect. It’s not about building products to solve problems, or feeling that what we do adds value. It’s about figuring out what kind of life you want to live. It’s about asking “why?” but then going deeper, until you see the pattern in “now what?”. He also pulls at what that question and its likely answers say about where society as a whole is heading. A lot to unpack here. (Means and Meaning, Not Boring by Packy McCormick)
Noah Smith warns of the risks building up in the eye-watering investment in AI data centers, and points out that the basic conditions of a financial crisis are starting to fall into place:
The “this time it’s different” hype
The large and growing amount of debt fuelling one single sector of the economy (which means correlated defaults)
The significant involvement of opaque private credit funds
Systemically important banks getting caught up in the expansion
(Will data centers crash the economy?, Noahpinion)
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)
I’ve seen some fun lists circulating of top summer songs, but one thing stuck out: they are all so different.
We know music is personal – but it turns out that our image of summer is, too, especially now that our media consumption is so granular and fragmented. Decades ago, we all watched the same summer movies and listened to the same music (maybe we didn’t like it, but we heard it). Now, there is no unifying platform, which means there is no “summer music” anymore.
But anyway, today I’ll share with you a smattering of my favourite seasonal songs, not the ones that I listen to most in these sultry days but the ones that to me say “summer”, that make me think of carefree times, extended vacation, watermelon, pretty cotton tops.
Let me know yours!
Summer in the City – The Lovin’ Spoonful
Aserejé – Las Ketchup
Watermelon Man – Mongo Santamaria
Good Vibrations – The Beach Boys
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. Also, I often use AI for research instead of Google, but never for writing.