Mainstream finance, supervised by national monetary authorities, has long viewed the crypto industry as fundamentally unstable and socially useless. Unregulated exchanges, stablecoins resembling money-market funds and speculative altcoins (stuff other than Bitcoin and Ether) have undoubtedly pioneered many blockchain applications. Going forward, licensed financial institutions like JPMorgan Chase & Co. may as well take control of the technology. After all, tokenized customer deposits will offer all the functionalities of programmable money. So why not promote them in smart contracts, as an alternative to stablecoins like Circle Internet Financial Ltd.’s USDC?
Authorities can at times lose control of depositary institutions, as we saw with the multiple US bank failures this year. Still, the risks are largely known, which isn’t the case with digital assets. Now that the US regulators are determined to check the unbridled growth of crypto, Wall Street can move in with tokenized versions of its own traditional products — starting with the humble bank deposit.
Source: Crypto: Watch Wall Street Move in After Crackdown – Bloomberg
