September 4, 2025, written in Singapore
In August 2025, global financial cities began to experience dramatic market changes due to the impact of the stablecoin wave. The push from Genius Act and Project Crypto, along with the wealth creation examples from Mstr and Circle, broke the equilibrium of interests in traditional finance. Stablecoins, the linkage between coins and stocks, DAT, RWA, and on-chain asset management quickly became competitive hotspots in the new environment.
Essentially, the implementation of the stablecoin bill marks the starting point for a comprehensive reform of the global financial chain. The second curve of Crypto growth will develop along the application scenarios of stablecoins and the tokenization of various assets, combining the flexibility of Crypto finance with the historical experience of professional finance, resulting in differentiated development under different regional compliance frameworks.
tl;dr
1. The essence of the Genius Act is to decentralize the issuance and settlement rights of currency, thereby gaining enhanced currency pricing power.
Stablecoins have triggered reforms in global financial chainization and asset chainization through changes in currency pricing forms.
The reform is rapidly dismantling the long-standing cartel alliances in traditional finance, bringing opportunities for interest restructuring amidst chaos.
4. Trump successfully aligned his interests with the historical transformation, creating an incredible legitimacy.
5. The two directions of coin-stock linkage: securitization and tokenization, and their market characteristics.
6. The industry characteristics and issues of stablecoins, DAT, stock tokenization, RWA, and on-chain asset management.
- The industry and cultural fragmentation following the initiation of the second curve of Crypto growth.
1. The essence of the Genius Act is to decentralize the issuance and settlement rights of currency, thereby gaining enhanced currency pricing power.
In a previous article titled GENIUS Act and On-Chain Shadow Currency, I detailed the irreversible trend of declining control over traditional dollars and how the Genius Act aims to decentralize issuance and settlement rights in exchange for a larger scale of circulating dollars. In fact, this move was further validated by the market within three months after the introduction of the Genius Act. At this stage, loosening the issuance and settlement rights of the dollar has, in fact, allowed dollar-derived stablecoins to gain broader market application scenarios through the form of shadow currency, strengthening a more extensive pricing power. The pricing power of currency is the embodiment of competitive consensus in the future of on-chain finance, while the issuance and settlement rights will gradually fade into a common infrastructure, losing their moat and competitive value.
The future currency war will be a competition of consensus power in currency applications, rather than a competition for the rights of currency issuance and settlement. This is a qualitative reform that on-chain finance forces traditional finance to undergo, and it is evident that many countries and regions' policies, as well as some traditional financial experts, scholars, and entrepreneurs, have not recognized or found it difficult to change this concept. In other words, the M2 of future on-chain currency will gradually lose its original meaning, and the excessive issuance of a large amount of currency and tokenized assets will represent a form of freedom. However, this freedom does not imply equivalent value; true value will exist based on the consensus power of currency and tokenized assets, reflected in their liquidity, purchasing power, interoperability, community recognition, and other substantively quantifiable market value feedback.
At such a critical juncture of qualitative reform, the flexibility of paradigm shift concepts is crucial. Many definitions from traditional economics, market control methods, and asset management styles will change. For example, as M2 loses its original meaning, it may be corrected through liquidity value factors as multipliers to obtain an effective circulation value of currency or assets, etc. Of course, various monetary and fiscal policies also need to undergo essential changes to adapt to the formation of new methods for on-chain economic governance.
2. Stablecoins have triggered reforms in global financial chainization and asset chainization through changes in currency pricing forms.
After the Genius Act quietly ignited this new currency war, countries and regions around the world rushed to introduce their own stablecoin bills. Although many of these bills are still based on the inertia rules of traditional currency finance, requiring time for iterative adjustments, the overall reform of the financial market towards chainization has already begun.
While the assets settled in 1 USD and 1 USDC (or other stablecoins) may not seem significantly different in pricing, the fundamental difference in their monetary mechanisms has led to substantial changes in the financial significance of assets. This is mainly reflected in the programmability, combinability, market liquidity, ecological differentiated circulation, and flexibility of financial derivatives of various assets.
Recently, when friends from traditional finance ask about the characteristics of on-chain asset management done by CICADA Finance, I use the analogy of a "financial motherboard." Various financial asset strategies are akin to different algorithms of "financial chips," forming flexible financial combinations on the financial motherboard through the selection and plugging of asset management, while stablecoins act as the "financial current" connecting the chips and the motherboard (Note 1).
3. The reform is rapidly dismantling the long-standing cartel alliances in traditional finance, bringing opportunities for interest restructuring amidst chaos.
From the Genius Act to Project Crypto, the stablecoin and on-chain financial reforms fundamentally disrupt the inherent interest models of traditional finance. At other historical times, this would certainly trigger large-scale conflicts; however, this time, the transition appears to be smooth and acceptable. Is it because modern financial legal systems have made competition fairer, or that contemporary institutions are more civilized compared to history?
Certainly not. The reason is simple: the current global social development curve is too rapid. Enterprises that understand trends and quickly transform can gain additional profits far exceeding the loss costs of clinging to existing interests and resisting change. The previous stage's financial cartel alliances were swiftly broken and abandoned by enterprises that transformed quickly. From Wall Street to the entire New York, the overall choice has adopted a (+3, +3) model to enter a new situation for competition. This process of transformation will inevitably lead to a chaotic restructuring of the financial market within a certain period, while also creating numerous trading opportunities for new assets and funds.
In the past month, I have observed in the New York market that the degree of cartel alliance solidification varies significantly across different industries. Although the financial industry has rapidly transformed under the impetus of the Genius Act and Project Crypto, many traditional industries (such as real estate) remain very stubborn. Due to the strict control of entry conditions and information flow by monopolistic alliances, the trading environment in many industries is still quite primitive, and many RWA assets are far from meeting the conditions for entering the current tokenization upgrade.
4. Trump successfully aligned his interests with the historical transformation, creating an incredible legitimacy.
It is worth mentioning that the driving force behind these rapid developments is the crypto president, Trump. Historically, pushing for reform usually involves high risks and significant resistance, especially when aligning one's interests with the reform, which seems to add fuel to the fire. However, Trump's actions have cleverly positioned him at a unique historical juncture, gaining incredible correctness and legitimacy, offsetting a large amount of negative opposition with the opportunities for interest restructuring brought about by an inevitable industry trend.
5. The two directions of coin-stock linkage: securitization and tokenization, and their market characteristics.
Coin-stock linkage is an important topic in Q3 2025. Essentially, coin-stock linkage involves two directions: one is to insert tokenized assets into listed companies, forming capital premiums in the form of stocks; the other is to tokenize stocks along the development of existing policies, reflecting a 7x24 hour tradable stock token market. The former is the process of securitization, usually managed by the securities regulatory authority of a country or region; the latter is the process of tokenization, typically managed by alternative asset management regulations of a country or region, some of which fall under banking regulations for currency or payments, while others belong to alternative securities regulation.
The securitization process of coin-stock linkage has evolved into a new term in Q3 2025, namely DAT (Digital Asset Treasury). This is a more flexible and universal process of inserting tokenized assets into listed companies to create capital premiums, following the ETF. The success of DAT in the first generation of Mstr and other cases has created a premium multiplier of 1.5x-2x (with peaks reaching nearly 4x), becoming the mainstream wealth creation method in major financial cities like New York and Hong Kong over the past six months. As we enter the end of Q3 and the beginning of Q4, the differences in the DAT market compared to the initial Mstr-BTC are: 1) the expansion of inserted assets, now including other non-BTC token assets like ETH and SOL; 2) in addition to the stock price premium multiplier caused by the inserted assets, financial instruments are beginning to be used to create leverage for higher capital or currency multipliers; 3) unlike Mstr, which has benchmark political and economic significance, the practices of small and medium-sized listed companies are mostly purely commercial, thus the risks of a Davis double whammy after obtaining a premium will be more pronounced.
The tokenization process of coin-stock linkage is still in its early stages in Q3 2025. The main issues include: 1) The to-C scenarios are premature, with current demand not being genuine (usually only involving the need to increase trading duration and evade taxes during non-compliance periods), still in the early stages of infrastructure construction and to-B; 2) The participation of small and medium-sized projects is not friendly enough, as the profit difficulties caused by issue 1) mean that only mature participants like Robinhood and Ondo Finance can support the initial market; 3) The demand for infrastructure construction and to-B is relatively hidden and lengthy, and individual business models find it difficult to be profitable independently, requiring the formation of an industrial chain to achieve overall resonance, necessitating a period of growth. Many institutions entering the market in the early stages have certain misconceptions about the development of stock tokenization; what is truly needed or in demand at this stage includes: 1) Achieving compliant pathways in different regions; 2) Issuing large-scale stock tokenized assets through low-cost purchasing/borrowing/holding of stocks; 3) Forming liquidity providers with substantial capital; 4) Creating leverage multipliers and derivative markets through financial instruments like lending; 5) Providing a large number of high liquidity assets with alpha-extractable value for the competitive token quantitative strategy market.
In comparison, as of Q3 2025, the securitization process of coin-stock linkage is somewhat closer to money than the tokenization process, but it also faces a shorter opportunity time window; conversely, the tokenization process of debt-stock exchange is a long-term development direction, an important step in the asset chainization process, and will open a larger market for strategy-based quantitative financial assets.
6. The industry characteristics and issues of stablecoins, DAT, stock tokenization, RWA, and on-chain asset management.
Stablecoins, DAT, stock tokenization, RWA, and on-chain asset management can be considered the five key elements of the second curve of Crypto growth and asset chainization. Among them, stablecoins, DAT, and stock tokenization have been discussed earlier and will not be elaborated on further.
RWA is an interesting track. Last year, it was unpopular; however, this year, despite regaining popularity, it has also encountered more problems, mainly including: 1) Most parties involved in RWA, whether asset providers or platforms, treat RWA as a fundraising tool without considering issues related to post-issuance purchasing power, exit strategies, liquidity, yield generation, market making, and sustainability; 2) There is a lack of consideration for the assessability of the fair value of RWA assets and the Oracle process; 3) Beyond fundraising functions, there is no economic design or ecological construction for composability and programmability, which is no different from the P2P and crowdfunding ideas of Web2.
In the past few months, we have engaged with numerous RWA partners. Abstractly speaking, RWA essentially builds a quasi-primary market for some non-standard assets. This is, in fact, a dilemma of treating others as one would not want to be treated. For assets that lack sufficient consensus, purchasing power, and liquidity, it is indeed challenging to achieve a one-step solution through RWA. The entire asset tokenization still needs to undergo a process of standardization, fair valuation, marketization, and financialization of the assets themselves. The most challenging issue to resolve for RWA assets is the liquidity problem of large mid-term tradable assets, which is akin to the issues faced by structured financial structures and liquidity asset disposal institutions in traditional markets. Currently, there is still a lack of effective solutions in the Crypto asset tokenization market.
Compared to the real estate, digital collectibles, and artworks that many people intuitively focus on, the RWA asset tokenization that is more feasible at this stage is actually in Supply Chain Fi and PayFi, as the characteristics of the underlying liquid assets support the feasibility of tokenized trading flows.
On-chain asset management is essentially a comprehensive track for classifying and managing various assets under the wave of stablecoins. It is fundamentally a systematic project that connects liquid assets with liquid funds, involving everything from economic model design to platform products, from asset selection to asset management operations, which is more complex than in TradFi and requires multi-faceted professional actuarial and quantitative capabilities. CICADA Finance has rapidly iterated its on-chain asset management capabilities in the past six months of second curve growth, pioneering new standards for on-chain asset management, and welcomes communication and cooperation with different assets and ecosystems.
7. Industry and cultural fragmentation following the initiation of the second curve of Crypto
After the SEC launched Project Crypto in August, the rapid growth of the second curve of Crypto accelerated the further differentiation of the entire Crypto market. Markets in North America, Southeast Asia, the Middle East, and Africa began to show completely different characteristics.
The development of Native DeFi and stablecoin ecosystems is strongest in New York and the East Coast; RWA and coin-stock linkage have opportunities in global financial cities, but each is influenced by its own policy peculiarities, which adds to the cognitive inertia of mainstream market participants, resulting in different interpretations; Africa, South Asia, and South America are developing more from the perspective of Supply Chain Fi and PayFi applications, which are truly the mainstream emerging markets that have not yet been priced into the Crypto Market but possess tremendous potential for future growth; Southeast Asia has instead become a base for the subsequent development of the first curve, with centralized exchanges and narrative projects gathering here to form new purchasing power.
The different social environments under varying geographies have created a fragmented layering of the Crypto market, with global finance facing disruptive changes in financial reforms and asset pricing methods across different dimensions. Stablecoins are merely the first step in this process.
Author: Yang Ge Gary
Date: September 4, 2025
Note 1: For details on the concept of financial current, see the article Financial Circuits and Web3 Economic Model Principles.
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