Welcome to the Monday edition of the Crypto In America newsletter!
Where does risk management end and gambling begin? Former CFTC Chairman Russ Behnam sat down with Crypto In America at Georgetown University’s Psaros Financial Markets Quality Conference to explain why Congress needs to draw that line as prediction markets continue to see explosive growth. With lawsuits over sports contracts playing out across the country, he says the issue could ultimately land before the U.S. Supreme Court.
Behnam also weighs in on crypto regulation after the Clarity Act failed to advance in the Senate. He explains why regulating spot markets with the CFTC’s existing authority can feel like using “Scotch tape and paperclips,” why there is now a premium on regulators writing durable rules, and what agencies can realistically do to protect customers if a crypto firm goes bankrupt.
Catch the full episode on all platforms here.
👀 What To Watch This Week
Monday
The House is out. The Senate is in.
Tuesday
10:00 a.m.: The Conference Board releases its September consumer confidence reading.
10:00 a.m.: The Bureau of Labor Statistics releases its August Job Openings and Labor Turnover Survey, or JOLTS report.
12:40 p.m.: Fed Governor Michael Barr speaks on the economic outlook.
3:00 p.m.: Fed Governor Christopher Waller gives a speech on payments.
Wednesday
Korea Blockchain Week’s main conference kicks off in Seoul. Crypto In America will be on the ground for the two-day event.
8:30 a.m.: The Commerce Department releases August personal income and spending data, including headline and core PCE inflation, the Fed’s preferred inflation gauge. Its third estimate of second quarter GDP is also due.
Thursday
9:05 a.m.: Richmond Fed President Tom Barkin, Kansas City Fed President Jeff Schmid and Boston Fed President Susan Collins discuss regional economic conditions.
10:00 a.m.: The Institute for Supply Management releases its September manufacturing index.
1:30 p.m.: Fed Vice Chair Philip Jefferson discusses the U.S. economy and monetary policy.
Friday
8:30 a.m.: Jobs Friday: The Bureau of Labor Statistics releases the September jobs report, including payroll growth, the unemployment rate and average hourly earnings.
News Flash
Luke Pettit, assistant secretary for financial institutions and acting under secretary for domestic finance, who worked on the GENIUS Act and Clarity Act efforts, will leave the Treasury Department next month for the private sector.
SEC Commissioner Hester Peirce will leave the agency on October 2 after nearly nine years. She’s set to join Regent University School of Law as an associate professor in November.
Blockchain Association CEO Summer Mersinger is stepping down on October 16. BA board president Kristin Smith will take over as interim CEO the following day while continuing to lead the Solana Policy Institute. Mersinger will stay on as an adviser through the end of the year.
Franklin Templeton and Bybit are partnering to let eligible institutional clients use tokenized money market fund shares as off-exchange collateral for crypto trading.
A U.S. Senate Democratic investigation found that 84% of 846 wallets sanctioned by the U.S. and Israel over ties to Iran transacted exclusively or nearly exclusively in Tether’s USDT.
Bitget says the vulnerability behind its roughly $388 million breach was in a third-party security product and allowed the attacker to obtain high-level internal credentials. The exchange says its private keys and cold wallets were not compromised.
Citigroup is partnering with Coinbase to let its institutional clients accept stablecoin payments from customers. Coinbase will provide the payment rails and convert the stablecoins into fiat, while Citi will settle the funds.
The Clearing House has selected Quant to power a new U.S. network for clearing and settling tokenized bank deposits. The network is expected to open to participating institutions in the first half of 2027.
California Governor Gavin Newsom signed a law barring state and local public officials from issuing meme coins.The law also restricts companies from listing certain meme coins tied to public officials for California residents.
U.S. spot Bitcoin ETFs have pulled in $5.3 billion since the Treasury announced plans to increase its buybacks of longer-dated bonds, including $2.4 billion last week alone.
Kalshi lost a major Sixth Circuit case over its sports event contracts. The court ruled that Ohio and Tennessee may enforce their sports gambling laws against the prediction market platform, rejecting Kalshi’s argument that federal commodities law preempts the states.
Defense Secretary Pete Hegseth disclosed at least $3.1 million in family cash, retirement investments and Bitcoin in his latest annual financial filing. His Bitcoin holdings were valued at between roughly $16,000 and $65,000.
IBM is connecting its Digital Asset Haven platform to Swift’s blockchain-based ledger, giving banks a way to move tokenized deposits 24/7 before final settlement through existing systems. The new connectivity is currently in beta.
Ondo partnered with BlackRock to launch three onchain investment portfolios using strategies developed by the asset manager. The products are currently available only to eligible investors outside the U.S.
The Federal Reserve proposed two stablecoin rules under the GENIUS Act. One establishes reserve, capital, custody and risk management requirements for issuers it supervises. The other outlines how state banks supervised by the Fed can apply to issue stablecoins.
CFTC staff clarified that registered derivatives firms can hold certain customer investments as tokens and use blockchain records to meet federal recordkeeping rules.
Inside the Clarity Act’s Failed Senate Vote
ICYMI: Crypto In America’s Eleanor Terrett moderated a panel discussion with White House Crypto Council Executive Director Patrick Witt and former Counselor to the Treasury Secretary for Digital Assets Tyler Williams at Georgetown’s Psaros Financial Markets Quality Conference to examine the Clarity Act’s failed Senate vote and what comes next.
They unpack the Clarity Act’s biggest challenges, including what went wrong during negotiations, what could have been done differently, whether banks overplayed their hand by lobbying against a deal that would have given them protections they now lack, and whether the bill can still make a comeback.
The conversation also covers the Strategic Bitcoin Reserve bill advancing out of the House Financial Services Committee, the administration’s crypto priorities going forward and how the market should ultimately judge its promise to make the United States the crypto capital of the world.
Remember: New editions of the Crypto In America newsletter drop every Monday and Thursday.
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"Scotch tape and paperclips" is the right description, and Friday showed the cost. Community banks sued the OCC asking a judge to throw out its March chartering rule. That's the catch with regulators doing what Congress wouldn't: anything an agency writes can be challenged in court. If the durable rules have to come from regulators now, how durable can they really be?