Good morning everybody.
I hope everybody had a great Father’s Day weekend.
We had the whole family over yesterday. Ribeyes, filets, scalloped potatoes, fresh garden salad, the whole thing. My dad was here. My brother was here. My brother’s father-in-law was here. Basically every dad I know was sitting in my living room eating steak.
One of the nice things about where I live is that every Father’s Day they shut down the town square and turn it into a giant car show.
Hundreds of cars.
American muscle everywhere.
Firebirds. Cutlasses. Chevelles.
I only saw one Porsche and two Audi R8s.
A little disappointing on the European side of things.
But I did see a mint-condition Thunderbird that reminded me just how beautiful some of those early 2000s retro designs really were.
Anyway, let’s talk crypto.
Strategy’s Bitcoin Machine Is Facing Questions
One of the more important stories this morning involves Strategy.
The company’s Bitcoin-backed preferred stock continues trading below its intended value, raising concerns about one of the funding mechanisms that Strategy has relied on to keep buying Bitcoin.
This matters because Strategy isn’t just a Bitcoin holder anymore.
Strategy is a financing machine that buys Bitcoin.
The company has built an entire treasury model around raising capital and converting it into Bitcoin exposure.
If investors become less interested in those preferred stock offerings, people start asking difficult questions.
Can Strategy continue buying at the same pace?
Will it need different financing methods?
Will it rely more heavily on common stock issuance?
The Bitcoin itself isn’t the concern.
The capital structure is.
And increasingly, the market is paying attention.
The Stablecoin Fight Isn’t About Crypto Anymore
The Bank of England released its final stablecoin framework and dropped earlier proposals that would have capped individual holdings.
Instead, regulators are proposing issuance limits and reserve requirements that allow stablecoin issuers to hold a significant portion of their reserves in short-term government debt.
At the same time, lawmakers in the United States are arguing over how the Genius Act should be implemented.
But what caught my attention wasn’t the stablecoins.
It was the fight underneath the stablecoins.
Because this is quickly becoming a battle over who gets to regulate them.
States?
Or the federal government?
And honestly, I understand both sides.
The States’ Rights Problem
I’ve always thought one of the strengths of the United States was that states could compete.
Different tax structures.
Different business environments.
Different regulations.
Different cultures.
If a state creates a better environment for businesses or families, people can move there.
That competition matters.
It’s one of the reasons the American system has worked as well as it has.
But at the same time, there are some areas where fifty different sets of rules become a problem.
Commerce is one of them.
Stablecoins are one of them.
Healthcare is one of them.
Even gun laws fall into this category.
If a company is trying to operate nationally, how do you build products around fifty completely different regulatory systems?
At some point, you need consistency.
Not because federal control is inherently better.
But because interstate commerce requires some level of cohesion.
That’s the tension we’re seeing with stablecoins right now.
It’s no longer crypto versus banks.
It’s becoming federal oversight versus state oversight.
And I think we’re going to see that fight play out across a lot more industries in the years ahead.
Stablecoins Keep Moving Toward Traditional Finance
Several federal agencies, including the Treasury, Federal Reserve, OCC, and FDIC, continue pushing frameworks that would require stablecoin issuers to follow anti-money laundering and customer identification rules similar to traditional financial institutions.
Honestly, I don’t have a problem with that.
If you’re issuing digital dollars, some level of compliance makes sense.
The issue becomes how far those requirements extend.
Regulating the issuer is one thing.
Regulating every individual user is something else entirely.
That’s where the line starts getting blurry.
And that’s where I think the real debate will happen.
The Hacks Continue
Meanwhile, crypto remains crypto.
Taiko temporarily halted its Ethereum Layer 2 network after attackers exploited withdrawal proof vulnerabilities and drained roughly $1.7 million.
Separately, the infamous JaredFromSubway.eth MEV operation was itself exploited for more than $7.5 million after attackers manipulated contract approvals.
There is a certain irony in watching an MEV bot get MEV’d.
But the broader lesson remains the same.
Smart contracts are only as good as their implementation.
And attackers remain relentless.
Pension Funds Continue Moving Into Crypto
One of the more encouraging stories came out of Japan.
A corporate pension fund serving roughly 1,200 small and medium-sized businesses plans to allocate approximately one percent of assets to crypto beginning in fiscal year 2026.
The allocation isn’t enormous.
Roughly $130 million.
But that’s not really the point.
The point is that another pension fund looked at crypto and decided it deserved a seat at the table.
That trend continues.
Slowly.
But steadily.
Crypto Prices
Bitcoin: $65,000
Ethereum: $1,776
BNB: $600
XRP: $1.15
Solana: $74.65
Tron: $0.331
Hyperliquid: $69.35
Dogecoin: $0.084
Total Crypto Market Cap: $2.2 Trillion
Fear & Greed Index: 23 (Fear)
My Take
The more I watch stablecoin regulation develop, the less I think this is a crypto story.
I think it’s a governance story.
Who makes the rules?
Who enforces the rules?
Who gets licensed?
Who gets shut out?
Who controls the rails?
That’s the real fight.
Five years ago we spent all our time talking about Bitcoin replacing banks.
Now we’re arguing about whether stablecoin issuers should be regulated like banks.
That should tell you how much the industry has changed.
Crypto isn’t trying to overthrow the system anymore.
Crypto is trying to become part of the system.
And whether that’s good or bad probably depends on what got you interested in crypto in the first place.