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Welcome back. It’s Fed day, so Casey unpacks where stocks and crypto stand and what’s weighing on them (or pulling them higher). Be sure to check out Felix’s deep dive on the dots in tomorrow’s edition. 

In the meantime, Ben has some updates on what might just be TradFi’s favorite new crypto investment vehicle. Here goes:

Current conditions

US equities moved higher while oil prices dipped in the hours before the FOMC decision. The price action comes on the heels of reports that the conflict in the Middle East may soon de-escalate. 

President Trump, speaking Wednesday to reporters outside the White House, said an Iranian delegation may be coming to Washington. 

“They want to negotiate,” he said. “They even suggested that they come to the White House. That’s courageous.” 

It’s a markedly different tone than the president has taken on social media in recent days. Yesterday afternoon, Trump called Iran’s leader an “easy target” in a Truth Social post. Trump added that US forces will not target Iran’s leader “for now.” 

Trump also reiterated his dislike for Fed Chair Jerome Powell on Wednesday morning, telling reporters the head of the US central bank is a “stupid person.” As we wrote yesterday, it sounds like Powell isn’t getting the renomination after his term ends next May. 

The president has repeatedly expressed frustration with the FOMC’s decision to hold interest rates. 

“Europe had 10 cuts, and we had none,” Trump told reporters. “And I guess he’s a political guy, I don’t know. He’s a political guy who’s not a smart person, but he’s costing the country a fortune.”

The S&P 500 and Nasdaq Composite indexes were trading 0.3% and 0.5% higher, respectively, an hour before the Fed released its interest rate decision. Bitcoin was flat over the day, hovering around $104,500. 

Stocks moved higher just after 2 pm ET when the Fed announced that interest rates will remain unchanged. Most committee members still expect two rate cuts before the end of the year, per projection materials released alongside the rate decision. Felix will be unpacking the dots in more detail tomorrow, so keep an eye on your inbox. 

In other news, the Senate passed its first-ever stablecoin-focused bill last night, sending crypto stocks higher in today’s session. The GENIUS Act passed in a 68-30 vote. 18 Democrats voted in favor while two Republicans broke with the party majority and voted against passage. 

Newly-public Circle, the issuer behind the USDC stablecoin, gained as much as 23% Wednesday. Crypto exchange Coinbase rallied more than 15% on the news. 

The regulatory tailwinds for crypto seem to be fueling what could soon become an IPO boom, even as geopolitical tensions and macro conditions paint an uncertain picture for the US stock market. 

The day after Circle’s IPO, crypto exchange Gemini revealed it had filed to go public in the US. 

We’ll be watching that space and keeping an eye on just how much insulation a favorable regulatory environment can provide.

— Casey Wagner

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Arkham is a crypto exchange and a blockchain analytics platform that lets you look inside the wallets of the best crypto traders — and then act on that information.

Arkham’s Intel Platform has a suite of features including real-time alerts, customizable dashboards, a transaction visualization tool, and advanced transaction filtering — all of which is accessible on all major blockchain networks, and completely free.

Arkham’s main product is the exchange, where users can express their trade ideas against the market.

This is the four-week moving average for initial jobless claims, according to data released Wednesday by the Department of Labor. The consensus estimate was 240,250. The figure suggests that while the labor market is not yet in dire straits, conditions are softening. 

As you’ve probably heard a thousand times: Tokenization is in its early stages. 

But a new tidbit seems to confirm that the utility of onchain assets will continue to evolve. 

As it stands now, stablecoins are “really the only [RWA]” that have gained substantial product-market fit, Ondo Finance CEO Nathan Allman recently told me. (My fuller Q&A with Allman will hit Blockworks.co a bit later). 

Circle had its IPO earlier this month and the Senate passed the GENIUS Act last night, both of which brought stablecoins further into the public eye.

While the promise of more widespread access to tokenized stocks, bonds and other assets has not yet been fully realized, another tokenized RWA with growing traction is money market funds. 

BlackRock got into that game with Securitize via the USD Institutional Digital Liquidity Fund (BUIDL) launch in March 2024. Its assets under management stand at roughly $2.9 billion.

Now, certain institutional clients using Crypto.com and Deribit can post BUIDL as collateral. The thought is enabling capital allocation flexibility while getting the relative price stability of tokenized Treasurys.

And the yield.

As Securitize CEO Carlos Domingo put it in a statement: “The fund is evolving from a yield-bearing token into a core component of crypto market infrastructure."

Tokenized money market funds are not here to replace the ~$240 billion stablecoin market, industry watchers have noted.

Standard Chartered’s Waqar Chaudry told me in March that the two are “definitely complementary,” adding: “Many might prefer tokenized funds for collateral management.”

But while BlackRock’s Robbie Mitchnick sees tokenized yield funds as the predominant cash savings vehicle, he believes stablecoins “will retain their dominance” for payments and transactions.

Deribit’s nearly $1.2 trillion in trading volume was one reason Coinbase agreed to buy the company last month. We’ll see if and how today’s development contributes to accelerated tokenized yield fund adoption. And, of course, we’ll get back to you. 

— Ben Strack