Crypto Weekly Digest | Stablecoin Giant Circle Surges 168% on NYSE Debut; Hong Kong's Stablecoin Regulations Set for August 1

Last week, the cryptocurrency market initially experienced high-level volatility. Due to a public spat between Musk and Trump, the crypto market took a sharp downturn, with Bitcoin approaching the $100,000 mark.

Circle's revenue primarily comes from interest earned on reserves backing USDC, with strong recent growth fueled by expanding stablecoin adoption and market demand. The company plans to use IPO proceeds to expand globally and develop the Circle Payments Network, targeting disruption of traditional cross-border payments with real-time, low-cost settlements. The successful IPO has sparked investor enthusiasm and is expected to pave the way for other crypto firms to go public, reflecting a broader acceptance and normalization of crypto assets in traditional financial markets.

According to a Hong Kong government announcement, the Stablecoin Ordinance (Chapter 656) will officially come into effect on August 1, 2025, establishing a licensing regulatory system for stablecoin activities. The Financial Secretary has specified that professional investors can access unlicensed specified stablecoins. Christopher Hui, Secretary for Financial Services and the Treasury, stated that the ordinance marks a key milestone for the development of the local stablecoin and digital asset ecosystem. Relevant regulatory details, including anti-money laundering requirements, have been finalized by the HKMA after consultation.

Federal Reserve Governor Michelle Bowman was narrowly approved by the Senate with a 48-46 vote to become the Fed's Vice Chair for Supervision. This key position will lead regulatory policy direction for the banking system and potential stablecoin issuers. As a Republican member, Bowman takes office during a transitional period in crypto industry regulation. In April 2025, the Fed, along with the OCC and other agencies, lifted restrictions on banks' business dealings with crypto firms. While the current stablecoin bill in the Senate leans towards OCC regulation of non-bank issuers, it still reserves the Fed's jurisdiction over bank-issued stablecoins and assigns it the responsibility to assess foreign regulatory capabilities.

Analysts point out that Bowman's policy orientation, replacing Democrat Michael Barr, will influence key issues such as crypto firms' access to banking services. Fed Chair Powell previously stated he would authorize the Vice Chair to lead the regulatory agenda, while Bowman has rarely made public statements on crypto regulation during her tenure as governor.

Wyoming Republican Senator Cynthia Lummis is pushing to add provisions to her party's tax and spending bill to reform how the United States taxes cryptocurrencies. Key points include extending the "wash sale rules" for securities trading to the cryptocurrency sector, which is expected to generate billions of dollars in tax revenue, while exempting Bitcoin miners from reporting gains and losses. Lummis submitted a tax reform proposal co-drafted with Senator Kirsten Gillibrand to Senate Finance Committee Chairman Mike Crapo.

Lummis emphasizes that the current tax system has flaws that need correction, while Gillibrand believes the timing for legislation is not yet right. Finance Committee members have consulted with President Trump on the bill's content, with Louisiana Senator Bill Cassidy revealing the president's interest in the "work account benefits" clause. If passed, this proposal would become the first systematic tax framework for crypto assets in the United States.

The UK’s Financial Conduct Authority (FCA) announced the removal of its ban on retail investors purchasing cryptocurrency exchange-traded notes (ETNs). This policy shift is expected to boost market growth and competitiveness, signaling a more open regulatory stance as the government aims to stimulate the digital asset sector and the broader economy.

BRN Chief Research Analyst Valentin Fournier maintains a pessimistic outlook, noting that bearish signals are accumulating. These include decreased ETF inflows, weakening momentum, and a surge in cryptocurrency IPOs, indicating profit-taking in the market. He points out that Circle and Kraken's financing and IPO plans suggest cryptocurrency companies are capitalizing on a high-valuation window, potentially signaling slower future growth.

Additionally, U.S. spot cryptocurrency ETF inflows have decreased, with significant drops in both Bitcoin and Ethereum ETF inflows, accompanied by price declines. Fournier believes these are signs of exhausted market momentum and recommends reducing risk exposure and shifting towards defensive strategies.

JPMorgan, the largest US bank, is preparing to allow its trading and wealth management clients to use certain crypto-related assets, such as Bitcoin ETFs, as collateral for loans. This step, starting with BlackRock’s iShares Bitcoin Trust, reflects the growing acceptance of crypto assets in traditional finance, especially amid efforts to ease regulatory constraints under the Trump administration.

Trump's Truth Social has filed an S-1 registration statement with the SEC for a Bitcoin ETF. The proposed ETF will directly hold Bitcoin and issue shares to investors, aiming to reflect Bitcoin's price performance. Crypto.com will serve as the exclusive custodian, primary executor, and liquidity provider. The launch is pending SEC approval of both the registration statement and a 19b-4 form. If approved, the ETF will list on NYSE Arca, with Yorkville America Digital as its sponsor. This move marks Truth Social's entry into the cryptocurrency ETF market.

According to CoinDesk, following Trump's election as U.S. President, public companies' enthusiasm for holding Bitcoin has surged. A Binance research report shows that as of late May, 116 public companies collectively held 809,100 bitcoins, valued at approximately $85 billion at current prices. This marks a significant increase from 312,200 bitcoins held a year ago, with nearly 100,000 bitcoins added since early April alone.

Since taking office, Trump has actively promoted cryptocurrency development, including establishing strategic Bitcoin reserves. New accounting rules allowing companies to recognize gains from Bitcoin holdings have also encouraged increased holdings. Additionally, newcomers like GameStop have begun accumulating Bitcoin, though strategy companies still hold the largest share. The report also notes that tokenized real-world assets have grown by over 260% this year, reaching $23 billion.

NASDAQ-listed business consulting firm ATIF Holdings (ZBAI.US) announced its strategic entry into the Bitcoin sector with a five-year plan to accumulate 1,000 bitcoins through a combination of direct purchases and mining operations.

As part of this plan, ATIF Holdings will adopt a hybrid strategy over the next five years, including: direct acquisition of Bitcoin in the open market; building and operating its own Bitcoin mining facilities; and/or acquiring operational Bitcoin mining sites. The company has already purchased Bitcoin in the open market and plans to continue buying in the near future.