Crypto Business Converges With Traditional Banking

At first glance, this week’s biggest business stories could have come straight from Wall Street. BlackRock launched tokenized money market funds for stablecoin reserves. Tether generated another $1.5 billion in profit from its US Treasury holdings. Tokenized gold continued gaining traction, though its use in decentralized finance remains limited. Even Bitcoin (BTC) mining was defined by production costs, profitability and balance sheet management rather than the price of Bitcoin.

The digital asset industry’s business model is increasingly converging with traditional finance. Stablecoin reserves, tokenized money market funds and onchain collateral are emerging as some of the industry’s most important revenue drivers, signaling that blockchain’s next phase may be shaped as much by financial infrastructure as by digital assets themselves.

BlackRock launches tokenized reserve funds for stablecoin issuers

Asset manager BlackRock has introduced two tokenized money market products designed to help stablecoin issuers meet reserve requirements under the US GENIUS Act, expanding its push into blockchain-based financial infrastructure.

One fund tokenizes shares of BlackRock’s existing Treasury liquidity strategy on Ethereum, allowing approved investors to transfer ownership onchain while the underlying assets remain invested in cash and short-term US government securities. The second is a new institutional money market vehicle built for digital asset markets that supports multiple blockchains and automatically reinvests income, making it suitable for stablecoin reserve management.

The launch deepens BlackRock’s presence in the rapidly growing tokenized Treasury market, where the asset manager already operates BUIDL, the industry’s largest tokenized Treasury fund. The move also reflects a broader shift by Wall Street toward onchain financial products following the passage of the GENIUS Act, which established a federal framework for payment stablecoins. 

Tokenized gold’s DeFi footprint remains small despite record trading volumes

A RedStone report found tokenized bullion held up during gold’s sharp sell-off, but DeFi lending adoption remains limited despite surging market growth and trading volumes.

Spot trading volume reached $90.7 billion in Q1 as gold futures rallied above $5,600 per troy ounce, yet only about $63 million of Tether Gold and PAX Gold is used as collateral on Aave v3 and Morpho — just 1.5% of their combined $4.2 billion market cap, according to RedStone. On March 23, Aave processed its largest cluster of XAUT liquidations without disruption after gold fell 10% in a week, the worst weekly performance in more than four decades; JPMorgan’s Greg Shearer described it as an “extremely brutal flush.”

Gold futures have since declined more than 20% from January peaks on expectations of higher US interest rates, and RedStone’s findings suggested tokenized gold was resilient yet faces an infrastructure gap as tokenized real-world assets scale.

Liquidations of tokenized gold collateral spiked across Aave and Morpho during March’s market sell-off. Source: RedStone

Trump-linked American Bitcoin posts record output, narrower Q2 losses

The Trump family-linked Bitcoin miner reported record second-quarter production, generating 932 BTC and narrowing its net loss from the previous quarter.

Nasdaq-listed American Bitcoin, co-founded by Eric Trump and Donald Trump Jr., reported record quarterly production of 932 BTC, helping lift mining revenue 8% to $67 million from $62.1 million in the first quarter. The company posted a net loss of $57.2 million, improving from an $81.8 million loss in Q1. 

Last month, it completed a 1-for-15 reverse stock split to maintain its Nasdaq listing after its share price fell below the exchange’s minimum bid requirement. Majority-owned by Hut 8, the miner held roughly 8,002 BTC as of June 30 and had pledged about 3,090 BTC as collateral under equipment purchase agreements with Bitmain.

While production and revenue improved, American Bitcoin remains unprofitable. Its reverse stock split underscores the challenges facing its public listing, while its pledged Bitcoin holdings expose the company to additional risk if BTC prices decline.

Tether posts $1.5 billion Q2 profit as US Treasury income boosts reserves

Tether generated a $1.5 billion net operating profit in the second quarter, driven primarily by interest earned on its US Treasury holdings and repurchase agreements, according to its latest quarterly attestation.

The attestation reported a reserve buffer of $4.11 billion as of June 30, with assets exceeding liabilities by that amount. Despite a broader stablecoin market contraction, USDT circulating supply rose by $446 million to $184.6 billion, preserving Tether’s share of more than 60% of the global market, which DeFiLlama valued at roughly $307 billion. Tether remains one of the largest holders of US Treasury securities.

The company’s earnings continue to benefit from elevated short-term interest rates, which boost income from Treasury bills and cash equivalents. However, the stronger profit and reserve surplus come amid continued pressure across the crypto sector and a weaker stablecoin market, conditions that could temper future growth if rate environments shift or market contraction deepens.

USDT continues to dominate the stablecoin market by circulating supply. Source: DeFiLlama

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