The Future of Stablecoins: Wall Street’s Role in the Crypto Market

Wall Street corporations’ increasing involvement in the stablecoin market may hasten the creation of rules in the United States, enabling a private alternative to a central bank digital currency (CBDC).

Ryan Sean Adams, a crypto investor, believes the recent launch of off-ramps in USD Coin for BlackRock’s tokenized fund is part of the growing integration between traditional finance and stablecoin providers.

“Stablecoins will happen in the U.S. because BlackRock and the banks want them to happen. This could not be more obvious,” Adams stated on X.

BlackRock’s BUIDL Fund: Stablecoin Liquidity Boost with USDC Integration

Circle, the company behind the USDC stablecoin, recently introduced a new feature on April 11. This functionality allows holders of BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL) to swap their shares for USDC. In simpler terms, investors in the tokenized fund can now easily convert their holdings into stablecoins, enhancing liquidity for shareholders around the clock.

BlackRock holds a significant stake in Circle, marking a strategic collaboration between the two entities. The partnership, announced in April 2022, saw BlackRock participate in Circle’s $400 million fundraising round. Additionally, BlackRock oversees the Circle Reserve Fund, a government-backed money market fund exclusively available to Circle.

“The new BlackRock BUIDL fund on Ethereum is a high-bandwidth pipeline between U.S. Treasury securities and USDC,” Adams said, adding that Circle’s planned initial public offering will also help stablecoins integrate with traditional markets.

“The banks will backdoor themselves into stablecoins by acquiring, partnering, and controlling crypto native companies, and they’ll lobby for stablecoin legislation and make it happen along the way. The US does not have the political will to build a central bank digital currency. They’re creating one de facto through private bank-issued stablecoins on public crypto networks like Ethereum.”

BlackRock is already a major player in the cryptocurrency market. The asset manager is behind the iShares Bitcoin Trust spot Bitcoin ETF, which was valued at $18.5 billion as of April 10. The company just launched its tokenized fund, BUIDL, which allows investors to purchase tokens representing shares in a fund that invests in assets such as US Treasury notes.