The dream of Clarity for digital assets in the U.S. is alive. Yesterday, the crypto market structure bill passed the Senate Banking Committee with a bipartisan 15-9 vote.
Its next stop? The full U.S. Senate.
Getting there wasn’t smooth. Over the past year, the framework has been a public tug-of-war between the banking lobby and the crypto industry. The latter's most vocal representative, Coinbase, famously even pulled support back in January over what looked like a strict ban on stablecoin rewards. Polymarket odds crashed.
Four months later, much of the crypto industry seems more comfortable with the draft that just cleared Senate Banking:
Deposit-like yield on payment stablecoins is banned, but activity-based rewards survive
DeFi infrastructure gets a more explicit carve-out from regulated financial intermediation.
Tokenization language becomes narrower but more workable, with more SEC flexibility around tokenized securities.
Non-custodial software providers and non-controlling developers get protections.
Still, this is not a home run yet. As of writing, Polymarket prices the likelihood of the Clarity Act passing this year at around 70%. The reason: the bill still needs to pass the full Senate. That likely means clearing a 60-vote threshold, so Republicans need more Democratic support.
One of the biggest remaining roadblocks is ethics language around crypto-related conflicts of interest involving government officials and their families (Trump).
Even after the Senate, the bill needs to be reconciled with the House version passed last year. Both chambers have to approve identical text before it reaches the President’s desk.
The White House is reportedly targeting July 4. Crypto’s Independence Day.
In today’s Briefing:
Circle raises $222 million in ARC token pre-sale
U.S. asset managers position for stablecoin flows ahead of GENIUS
HIGH SIGNAL NEWS
Circle raises $222 million for Arc network. Led by a16z crypto, the ARC token pre-sale drew investments from firms including Apollo and BlackRock. The raise brings the payment-focused Layer 1’s fully diluted valuation to $3 billion. 💰
USDC becomes Hyperliquid's preferred stablecoin. To enable this, Coinbase struck a deal with Native Markets, the firm behind Hyperliquid’s current stablecoin USDH, to acquire the rights to its brand assets. 💸
Bitwise expands into Solana ecosystem. The $11 billion asset manager will now curate an Ethena USDe market on Jupiter Lend, one of Solana’s largest lending markets. In the first days after launch, the market attracted around $300 million in deposits. 📈
Bank of England set to ease planned stablecoin restrictions amid industry pressure. On Thursday, BoE Governor Sarah Breeden told the Financial Times that the central bank is “looking very hard” at alternatives to its proposed approach for regulating stablecoins. Under the current proposal, individuals would be limited to holding up to £20,000, while businesses would face a £10 million cap. 🇬🇧
TOP STORY
U.S. Asset Managers Position for Stablecoin Flows Ahead of GENIUS
The fight for stablecoin reserves: Over the past few weeks, three of the largest U.S. asset managers — Morgan Stanley, BlackRock, and JPMorgan — have launched or filed for money market funds purpose-built for stablecoin issuer reserves. The timing is deliberate. In January 2027, the GENIUS Act is expected to take effect, requiring every U.S. stablecoin to be backed 1:1 by short-dated Treasuries, bank deposits, or government-registered money market funds holding those assets.
Why it matters: Stablecoin reserves are already a major revenue driver for some asset managers. BlackRock already manages roughly $67 billion of Circle’s USDC reserves, about 87% of the stablecoin’s backing, generating more than $100 million in annual management fees at the fund’s ~0.16% rate. And with Citi expecting the stablecoin market to exceed $2 trillion by 2030, asset managers are now competing for a foothold in one of the fastest-growing pools of capital.
“The significant increase in stablecoin issuers as well as the growing number of assets held in stablecoins represents an evolving portion of the marketplace that is ripe for future growth,” noted Fred McMullen, Co-Head of Global Liquidity at Morgan Stanley Investment Management.
Three funds, three positions on tokenization: While the three managers target the same market, their funds occupy different points on the spectrum between traditional and tokenized infrastructure.
Morgan Stanley’s MSNXX is the most conventional. It uses a traditional shareholder register, with subscriptions and redemptions running through standard fund rails. No blockchain component.
JPMorgan’s JLTXX sits in the middle. Token balances and smart contracts enable blockchain-based redemption requests and transfers, but the official record of ownership remains the traditional Investor Register maintained by the transfer agent.
BlackRock’s BRSRV goes furthest. Shares are recorded on public blockchains and can be transferred peer-to-peer between whitelisted wallets. Together with an offchain identity register maintained by Securitize’s transfer agent, the blockchain record forms the fund’s official shareholder register.
The BUIDL question: For BlackRock, BRSRV would be its second tokenized money market fund. Its first, BUIDL, now sits at $2.4 billion in TVL and is used as collateral by stablecoins such as Ethena’s USDtb. But because BUIDL is not classified as a government money market fund, its role under the GENIUS Act remains unclear. BRSRV appears designed to meet that requirement.
The cap fight: Still, whether a fund like BRSRV can even hold a meaningful share of any issuer’s reserves is now itself in regulatory doubt. In its proposed GENIUS Act rulemaking, the OCC has asked whether tokenized reserve assets should be capped at 20% of a stablecoin issuer’s total reserves. The agency’s stated concern is that, even when the underlying assets are high-quality, putting ownership onchain adds operational, custody, and settlement complexity that could complicate reserve management during heavy redemptions.
The pushback: BlackRock is not waiting for the rules to land. In a 17-page comment letter to the OCC, the asset manager urged regulators to drop the proposed cap, arguing that reserve risk should be assessed based on the underlying asset’s liquidity, duration, and credit quality, not on whether ownership of that asset is recorded on a blockchain.
Adam Ackermann is Head of Treasury and Portfolio Management at Paxos. Prior to Paxos, he was Executive Director and Senior Portfolio Manager for JPMorgan Asset Management’s Government Money Market Funds, where he helped oversee approximately $500 billion in institutional MMF assets and also introduced the concept of tokenized MMFs internally at JPMAM in 2019.
What is the benefit of tokenized MMFs over traditional funds?
Tokenized MMFs provide additional utility because they can enable liquidity rebalancing to remain onchain rather than requiring redemption to fiat and movement through the banking system. For example, an issuer could mint or redeem stablecoins directly against MMF tokens instead of cash. Another potential benefit is peer-to-peer transferability within a sponsor’s ecosystem or walled garden, effectively creating a 24/7 book-transfer mechanism.
That said, these funds are not necessarily specialized products. GENIUS-compliant MMFs are structurally similar to existing Rule 2a-7 government money market funds, but with a more restrictive permissible asset set under the GENIUS framework.
Mark Phillips is Co-Founder of Grove, a credit infrastructure protocol that enables asset managers, treasuries, and individuals to access onchain yields with institutional-grade controls. He previously co-founded Steakhouse Financial, a leading vault curator.
What is needed for tokenized money market funds to become more attractive collateral for stablecoin issuers?
A key obstacle for tokenized MMFs as stablecoin collateral today is the mismatch between collateral and settlement rails. For example, if a stablecoin issuer redeems onchain shares of a tokenized MMF, access to cash still depends on the fund’s underlying offchain processes.
What is needed is convergence between collateral movement and settlement, with both taking place on shared onchain rails.
Until this convergence happens, liquidity hubs for tokenized MMFs, such as Grove’s Basin, help bridge the fragmentation. They provide instant stablecoin liquidity to tokenized fund holders in size while the traditional subscription and redemption process settles in the background. This makes tokenized MMFs usable not only as yield-bearing reserves, but also as real-time collateral infrastructure connecting stablecoin issuers, funds and onchain settlement.
1inch: Senior Software Engineer, Blockchain, Stuttgart 🇩🇪
Binance: Global Regulatory Legal Lead, London 🇬🇧
Bitvavo: Director of User Experience and Design, Amsterdam 🇳🇱
Bybit: Payments Principle Product Specialist, Vienna 🇦🇹
Chainlink: Account Executive, EMEA, United Kingdom 🇬🇧
Circle: Director, Security Compliance, London 🇬🇧
Crypto(.)com: Product Director, Banking Engagement, Berlin 🇩🇪
Securitize: Director of Sales, EU, Spain 🇪🇸
Next week, we’re back on tour with the launch of the Blockstories Horizon 2026 Summer Series, kicking off in Madrid on May 21 before continuing to Amsterdam for our Money20/20 Summit.
Join us and our partners from Visa, Bitwise, Steakhouse Financial, ABN AMRO and others for exclusive evening events exploring the top trends in digital assets over the next 12 to 18 months.
Elliptic | $120 million | Series D : Crypto compliance and blockchain analytics platform.
Augustus | $40 million | Unknown : Digital bank focused on AI and crypto assets.
Osero | $13.5 million | Seed Round : Stablecoin yield infrastructure platform.
turnkey | $12.5 million | Strategic : Wallet infrastructure provider.
Boundary | $2 million | Pre-Seed : Issuer of the institutional-grade USBD stablecoin.
What do you think of today's briefing?
Disclaimer: The information provided in the Crypto Briefing by Blockstories does not constitute investment advice. Accordingly, we assume no liability for any investment decisions made based on the content presented herein.
