Shallow Cuts, Shifting Flows: Fed Moves, Stablecoin Expansion, and Market Realignments

Federal Reserve – September FOMC Recap

• Decision: Cut 25 bps to 4.00–4.25%
• Dots: Median path = 2 more cuts in 2025 (50 bps); 25 bps/yr in 2026–2027
• Committee split: 9/19 see two cuts next year; 6/19 see none
• Powell (labor): Job gains below breakeven; “can no longer say labor market is solid”
• Powell (inflation): Recently firmer; tariffs driving goods prices; impact seen as short-lived
• Stance: No appetite for 50 bps; “don’t need to move quickly”; cut framed as risk management

Summary:
The Fed delivered a 25 bps “starter” cut to 4.00–4.25%, while signalling a shallow easing path ahead—two more cuts pencilled in for 2025 and gradual trims through 2027. Chair Powell painted a cooler backdrop: hiring has slipped below breakeven, marginal workers are struggling, and GDP’s moderation reflects softer consumption. Inflation has ticked up recently, largely on tariffs, which the Fed views as transitory but uncertain. Powell stressed independence and patience, pushing back on market rate paths and emphasizing meeting-by-meeting risk management. Market is still pricing in an almost certain cut next meeting, looking through what it takes to be the usual Feds jawboning though.

‍

Toyota, Yamaha, BYD Accept Tether in Bolivia as USD Reserves Shrink

• USDT accepted for vehicle purchases; first Toyota sold with USDT
• BitGo + Tether assisting self-custody & settlement at dealerships
• Macro backdrop: FX reserves down 98% since 2014; crypto ban lifted in 2024

Summary:
Facing a severe USD shortage, major automakers’ dealerships in Bolivia—Toyota, Yamaha, BYD—now accept USDT. With BitGo and Tether providing custody/ops support, USDT payments are spreading from retail to trade finance, where importers source stablecoins to pay suppliers. Since lifting its crypto ban in 2024, Bolivia has seen rising stablecoin use (even airport shops price in USDT). The country’s October run-off election may further shape policy; one frontrunner proposes blockchain transparency in governance.

‍

First Chinese CNH Stablecoin Debuts as Global Race Heats Up

• AnchorX launches AxCNH (offshore CNH peg) in Hong Kong
• BDACS launches KRW1 (Korean won peg)
• Both are over-collateralized (fiat/government debt in custody)

Summary:
The stablecoin geopolitics chapter deepens as AxCNH—a regulated, offshore yuan (CNH) token—launches at the Belt and Road Summit, targeting cross-border flows with BRI partners. In parallel, KRW1 expands on-chain access to the Korean won. Over-collateralized designs align with the trend of stablecoin issuers holding sovereign debt, effectively broadening the global buyer base for T-bills/bonds and putting national currencies on 24/7 settlement rails. The moves underscore governments’ push to keep pace with USD-pegged dominance.

‍

CZ’s YZi Labs Deepens Stake in Ethena

• YZi Labs increases investment to expand USDe across CEX/DeFi & BNB Chain
• Supports USDtb (treasury-backed) and Converge (EVM settlement/RWA layer)
• USDe market cap ≈ $14B, trailing only USDT/USDC

Summary:
YZi Labs (formerly Binance Labs) doubled down on Ethena, backing a multi-pronged push: scaling USDe distribution, advancing USDtb (short-duration treasuries such as BUIDL), and building Converge as an institutional settlement chain. With marquee investors in the cap table and fast-growing adoption (notably on BNB Chain), USDe’s delta-neutral design is positioning it as a credible alternative to fiat-backed giants, setting up share-of-wallet battles across exchanges, money markets, and on-chain derivatives.

‍

BitGo Files for US IPO with $90B AUC

• Targeting NYSE: BTGO; $90.3B assets on platform (as of Jun 30, 2025)
• 1,400+ supported assets; 4,600+ clients / 1.1M+ users / 100 countries
• Dual-class shares; CEO Michael Belshe retains control; BaFin license extended (MiCA)

Summary:
Custody leader BitGo filed for a US IPO, spotlighting institutional crypto’s next leg. With $90B+ in assets under custody, broad asset coverage, and SOC 1/2 controls plus $250M insurance, BitGo is pitching itself as core infrastructure amid bank re-entries and TradFi expansion into crypto custody. A dual-class structure keeps founder control, while a strengthened EU license positions the firm to capture MiCA-driven opportunities across trading, custody, staking, and transfers.

‍

FTX Recovery Trust to Unlock $1.6B for Creditors (Sept. 30)

• Third distribution: $1.6B slated for Sept 30 (+ funds arrive within 3 biz days)
• Payouts: 6% (Dotcom Customer), 40% (US Customer Entitlement), 24% (GUC & Digital Asset Loans), 120% (Convenience claims)
• Up to $16.5B earmarked for creditors (after prior $1.2B in Feb, $5B in May)

Summary:
The FTX Recovery Trust will disburse a third tranche—$1.6B—on Sept. 30, continuing a multi-billion-dollar unwind toward $16.5B in total distributions. The tiered schedule sends meaningful cash to claimants and may periodically impact market flows as recovered funds re-enter crypto/fiat channels. Meanwhile, SBF plans a November appeal following his 25-year sentence, maintaining arguments around solvency and trial fairness.

‍

Aster (BNB Chain) Hits $2B TVL Before Sharp Pullback

• Aster TVL briefly > $2B, retraced to $545M, then rebounded to $655M
• APX token launch spiked activity; $434M 24h volume
• Comparables: Hyperliquid still leads on TVL/volume/open interest

Summary:
BNB Chain perp DEX Aster surged past $2B TVL on token launch hype before settling lower, though still above pre-launch ranges. Social buzz—including a congratulatory post from CZ—fueled speculation about ties to the Binance founder, even as he remains formally barred from management. With backing and incubation links via YZi Labs/BNB Chain, Aster is now a focal point of BNB’s derivatives strategy—but early UX complaints and sharp TVL swings underscore the execution and stickiness hurdles ahead versus entrenched rival Hyperliquid.

‍

Important Dates: Sep 22 – 27, 2025