Stablecoin Growth Presents New Risks for Regulators, BIS Says
Growth in both circulation and integration with traditional finance warrant closer regulatory scrutiny, the BIS said in a bulletin on Friday. It cited a doubling in stablecoins' overall market value to about $255 billion since 2023, with more than 90% of that value concentrated in two US dollar-pegged tokens.
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5 things in markets that will make you do a double-take
Well, it is mid-summer, and the markets — and the business world — just get weirder and weirder. Rather than connect five points directly to one theme this week, we are going to take a look at five news items that have recently made me do a double-take, and have reminded me that there is never a dull moment in business and in investing. Yes, the business world remains — always — surprising and unique. Trump's Powell obsession U.S. President Donald Trump wants to fire Federal Reserve chief Jerome Powell. He seems obsessed with it, and it has gotten to the point of school-yard name calling bullying. But my question is: Why? Trump of course wants lower interest rates. Investors, home buyers and consumers like low rates, and lower rates will also substantially help the U.S. budget by lowering its massive interest rate charges. But let's take a look at Powell's record: He managed to successfully slay the inflation dragon of 2022; he steered the U.S. economy through the COVID pandemic and essentially by doing so saved the world; unemployment is low and stock markets are near record highs. What's not to like? Trump needs to understand that simply lowering the Fed rate does not always work, anyway. The market is smarter than that. Market interest rates can still rise even if Fed overnight rates fall. Before making any Fed personnel moves to enhance his own agenda, Trump might want to look at the economic record of Turkey, which pursued a lower interest rate policy before it was ready. (Hint: It's not good.) Sarepta Therapeutics Inc. It's been a long time since we have seen a blow-up fist fight between a company and the U.S. Food and Drug Administration (FDA). But Sarepta came close. The company is developing drugs and therapies for Duchenne Muscular Dystrophy, a horrible disease affecting mostly boys. Elevidys, its gene therapy treatment, showed promise in treating the disease. But then three patients died taking the drug and the FDA asked the company to stop shipments. On July 18, the FDA met with the company and the company essentially said, 'Nah, we are not going to do that.' Eventually the company relented and voluntarily stopped shipments. This week, it was allowed to resume shipments after patient advocacy groups lobbied for the drug's return. How has all this worked out for Sarepta? Shares are down about 87 per cent this year. Palantir Technologies Inc. Palantir has been one of the best-performing large-cap stocks this year, up more than 100 per cent. Market capitalization is now about US$370 billion. Its focus on artificial intelligence and data analytics has been in the sweet spot of this year's tech rally, and the company has reported solid growth in revenue and earnings. That being said, every single analyst report on the company discusses its extreme valuation. It is certainly notable: The stock trades at 267 times earnings and at nearly 100 times forward sales. Some analysts view it as the most expensive stock ever. Of course it was expensive at the start of the year too, before its big move. So, considering this, we looked at the short interest of the company. Right now, it is 2.5 per cent. So while it may be very expensive, the short sellers are not really committing capital to this call by shorting it. As a comparison, Manulife Financial Corp., the conservative and stable insurance company, has a higher short interest, at 2.8 per cent. And, by the way, its price-earnings ratio is only 11 times earnings. Maybe all the short sellers in Palantir have given up. They have certainly lost money so far. But the situation is a good example of how some companies can stay expensive for a long time. Or, sometimes they are expensive for a reason. What year is it again? Despite lots of worries in the world investors seem to have lots of confidence. Yes, meme stocks are back again, like they were in 2021. Companies such as QuantumScape Corp., GoPro Inc. and Kohls Corp. have seen their stock prices soar as retail traders and Reddit chat boards hype up their prospects. Being on the right side of this trade can be very profitable but investors are not exactly buying 'quality' here. Meme stock traders are buying with the expectation, simply put, that someone is going to pay more. We heard a new phrase this week regarding the phenomenon: One noted analyst called it a 'flight to crap.' Meme stocks are causing some excitement during the slow summer months, but, like prior instances, we doubt it is going to end well for traders. If it sounds too good to be true, it could yield trouble We have been watching with interest this year's obsession with very-high-yield exchange-traded funds (ETFs). There are products out there, such as YieldMax MSTR Option Income Strategy ETF (symbol MSTY), that have an indicated yield of — wait for it — 72.91 per cent. This ETF uses a synthetic option strategy on a single stock, MicroStrategy Inc. to enhance yield, which is paid out to unitholders. MicroStrategy is among the largest corporate holders of bitcoin right now, and with bitcoin's rally, the stock has done very well. But even with such a high yield the units of MSTY are down more than 20 per cent this year. ETF owners, attracted by the giant income, still haven't made any real money, even though MicroStrategy stock itself is up about 36 per cent so far this year. Yet, this has not stopped investors from pouring money into the ETF, now at about US$5.6 billion in assets. And this is just one example. There are now many dozens of such super-high yielding ETFs. We think investors need to be careful here. In addition to getting seduced by high yields, investors could be in trouble in a different type of market, or if the derivative market seizes up, as it has done before. Peter Hodson, CFA, is founder of 5i Research Inc., an independent investment research network helping do-it-yourself investors reach their investment goals. He is also portfolio manager for the i2i Long/Short U.S. Equity Fund. (5i Research staff do not own Canadian stocks. i2i Long/Short Fund may own non-Canadian stocks mentioned.) 5 reasons to be worried about the market today 5 reasons new market highs are not necessarily a sign to sell If you like this story, sign up for the FP Investor Newsletter. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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6 minutes ago
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Got $1,000? 3 Cryptocurrencies to Buy and Hold For Decades
Key Points Bitcoin's 16-year track record and $2.34 trillion market cap make it the cornerstone of any crypto portfolio. Ethereum's smart contract technology powers everything from NFTs to stablecoins, with massive growth potential ahead. Without Chainlink's real-world data connections, Ethereum's contracts would be worthless. 10 stocks we like better than Bitcoin › Some cryptocurrencies can be fun and exciting for a little while. The hottest new idea or cutest meme coin logo writes headlines for a while. The crypto's price soars as long as the news coverage continues -- and then it's over. The hottest coin or token isn't so great anymore, people moved on to the next Next Big Thing, and the chart starts to droop. And then there are the cryptocurrencies that were made to last. This is where you should start your crypto journey. A $1,000 investment spread across these dependable crypto names should serve you well. Good old Bitcoin (CRYPTO: BTC) has been around since 2009, and many investors expect it to be relevant forever. Ethereum (CRYPTO: ETH) changed the crypto game with the first smart contracts -- another innovator with long-term plans. And Chainlink (CRYPTO: LINK) provides a unique and necessary service to the crypto community. If any of these three cryptocurrencies go out of style and lose value in the long run, the whole crypto market would crumble. These are the building blocks that the broader set of digital currencies were built around. So I wouldn't buy some Bitcoin for a bit of summer fun, or speculate in Chainlink and Ethereum over a couple of weeks. They are long-term investments, made to hold for years and years. Bitcoin believers think it's digital gold The first Bitcoin was mined on January 3, 2009. The subprime mortgage meltdown was in full swing and banks didn't look like particularly safe places to store your wealth at the time. It's no surprise that a new form of digital currency was invented and launched in that era. More than 16 years later, Bitcoin is still going strong. With a total market value of $2.34 trillion and an inflation-proof limit to the creation of new coins, it's the largest name in the crypto sector. So-called Bitcoin maximalists, like Strategy (NASDAQ: MSTR) chairman Michael Saylor, expect Bitcoin to replace old-school currencies like the dollar and the euro over time. From that point of view, Bitcoin could be the only cryptocurrency or currency worth owning in the long haul. That's an extreme view and I certainly wouldn't recommend copying Saylor's Bitcoin-binging tactics. He has converted nearly all of Strategy's cash reserves into Bitcoin holdings. Then, he took out loans and sold stock to buy even more coins. His approach looks brilliant when Bitcoin's price is going up, but could end in financial disaster in the opposite scenario. But I do recommend having some Bitcoin exposure in your nest egg. You could buy some of the cryptocurrency directly, or pick up shares of a spot Bitcoin exchange-traded fund (ETF) like the iShares Bitcoin Trust ETF (NASDAQ: IBIT). You could even invest in a company that owns a lot of Bitcoin, such as Strategy or a leading Bitcoin miner. Either way, a modest amount of this robust digital coin belongs in any crypto-friendly investor's holdings. Ethereum actually does something useful Ethereum is a much smaller asset, with a market value of $455 billion today. It's still a big fish in the crypto pond, though. Other than Ethereum and Bitcoin, no other coin is worth more than $200 billion. It's a very different idea. Bitcoin creates value for its owners by providing a secure currency with strict supply side limits. It's rare on purpose, and it's expensive to create new coins because the mathematical difficulty keeps increasing. Things are different in the Ethereum camp. There's no hard cap on the Ethereum supply. The number of coins has held steady since the fall of 2022. The balance is regulated by staking rewards and the partial removal ("burning") of coins that are collected as transaction fees. And those fees are the keys to the Ethereum castle. This cryptocurrency can manage and execute smart contracts, generating transaction fees in the process of actually doing things. So far, Ethereum has mainly been used to power non-fungible tokens (NFTs) and certain stablecoins. One of these days, you may find your personal finances managed by blockchain-based apps on your phone, kicking banks out of the process. Ethereum will almost certainly play a role in that revolution, generating fees with every money transfer, account balance review, and digital ID presentation. Millions of active users could add a ton of Ethereum value. This sea change hasn't happened yet, and it might be fairly invisible when it comes. Still, the influx of active usage will boost Ethereum's price. There are fewer investment options here, since very few companies hold Ethereum on their balance sheets and you can't mine the currency. But you still get to choose between direct Ethereum holdings or spot-priced Ethereum ETFs, led by the iShares Ethereum Trust ETF (NASDAQ: ETHA). After getting your cryptocurrency feet wet with some Bitcoin, a bit of Ethereum exposure should be next on your long-term investment list. Chainlink feeds real-world info to Ethereum Finally, Ethereum's smart contracts rely on real-world data. Chainlink's job is to deliver that data in a form that makes sense to smart contract developers. Chainlink isn't the only so-called oracle coin on the market, but it's miles ahead of the competition. With a $12.1 billion market cap, Chainlink dwarfs Bittensor's (CRYPTO: TAO) $3.6 billion and Pyth Network (CRYPTO: PYTH) at $724 million. Even so, Bittensor and Pyth don't really copy Chainlink's broad portfolio of real-world data feeds. Bittensor helps artificial intelligence systems rate each other. Pyth provides high-speed access to a handful of financial data points. Without Chainlink's input, Ethereum would grind to a halt. Smart contracts without data access can't get any work done. As such, I highly recommend grabbing a few Chainlink coins. There are no ETFs or indirect investments to consider here, just the basic cryptocurrency itself. Should you buy stock in Bitcoin right now? Before you buy stock in Bitcoin, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Bitcoin wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $638,629!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,098,838!* Now, it's worth noting Stock Advisor's total average return is 1,049% — a market-crushing outperformance compared to 182% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 29, 2025 Anders Bylund has positions in Bitcoin, Chainlink, Ethereum, iShares Bitcoin Trust, and iShares Ethereum Trust-iShares Ethereum Trust ETF. The Motley Fool has positions in and recommends Bitcoin, Chainlink, and Ethereum. The Motley Fool recommends Bittensor and Pyth Network. The Motley Fool has a disclosure policy. Got $1,000? 3 Cryptocurrencies to Buy and Hold For Decades was originally published by The Motley Fool
Yahoo
6 minutes ago
- Yahoo
Tether Posts $4.9B Profit, Surpasses $127B In U.S. Treasuries In Q2
Tether (CRYPTO: USDT) on Thursday released its Q2 2025 attestation, showing the company added over $13.4 billion in USDT during the quarter. What Happened: With more than $20 billion in net new issuance year-to-date, the total supply of USDT has risen to over $157 billion. The report shows that Tether's total exposure to U.S. Treasuries climbed to $127 billion, including $105.5 billion in direct holdings and $21.3 billion held indirectly, up from roughly $119 billion in Q1. This level of exposure places Tether among the world's largest holders of U.S. sovereign debt, rivaling even institutional investors and central banks. Tether's net profit for the second quarter reached approximately $4.9 billion, with $3.1 billion of that attributed to recurring operational earnings. The remainder, roughly $1.8 billion, came from mark-to-market appreciation in its bitcoin and gold holdings. Combined with Q1 results, total net profit for the first half of 2025 now stands at $5.7 billion. Shareholder capital remained steady at around $5.47 billion, supporting Tether's long-term solvency. The attestation confirmed that Tether's total assets stood at $162.57 billion at the end of June, exceeding its $157.1 billion in liabilities, of which $157.1 billion were related to tokens issued. Tether noted that proprietary investments in emerging sectors such as AI, energy, and communications are not counted as part of its token reserves. However, these ventures, led through Tether Investments and XXI Capital, continue to receive a growing share of Tether's retained earnings. The firm reported that roughly $4 billion has already been deployed into U.S.-based ventures as part of its reinvestment strategy, including projects like Rumble and the Rumble Wallet. These initiatives are aimed at enhancing financial infrastructure, digital rights, and open-source platforms globally. Also Read: What's Next: CEO Paolo Ardoino emphasized growing confidence in Tether's model, stating, "Q2 2025 affirms what markets have been telling us all year: trust in Tether is accelerating." "With over $127 billion in U.S. Treasury exposure, robust Bitcoin (CRYPTO: BTC) and gold reserves, and over $20 billion in new USDT issued, we're not just keeping pace with global demand, we're shaping it,' he added. Ardoino also noted that Tether represents a "live, proven model" of stablecoin functionality at scale, offering "transparency, resilience, and massive global reach" amid ongoing regulatory developments concerning digital dollars. Read Next: Image: Shutterstock Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? This article Tether Posts $4.9B Profit, Surpasses $127B In U.S. Treasuries In Q2 originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
