[███░░░░]: A Week of Regulatory Whiplash

Welcome to the TAC's Progress Bar, where we combed through 852 relevant tokenization news stories from the week, analyzed the key stories on our weekly podcast, then distilled what you need to know into a few hundred words in this newsletter. Delivered to your inbox in time for Friday happy hour in NYC (usually).

The biggest names in traditional finance crossed a line this week that they can't uncross. Circle raised $222 million for their Arc network from BlackRock, Apollo, and A16z at a $3 billion valuation. Meanwhile, the Clarity Act cleared Senate Banking Committee with bipartisan support, though the path to passage remains narrow.

Market KPIs (brought to you by RWA.xyz):
📈 RWA market cap was down 50 basis points WoW to $34.1 billion
🏆 Biggest RWA winner: Biddle added $85M and made a significant move to Avalanche
🏆 Biggest network winner: Avalanche added $440M as Biddle migrated from BNB and Solana

📈 Stablecoin market cap was flat WoW to $305 billion
🏆 Biggest stablecoin winner: USD1 added $270M
🏆 Biggest network winner: Arbitrum added $500M

📈 Onchain risk free rates:
Short term treasuries (1m): 3.5% (down 10 basis points)
Aave / DeFi: 3.75% (still elevated above SOFR following recent DeFi incidents)

Stories we're tracking this week

The institutional playbook for corporate tokenization just got its template.

• Securitize reported record Q1 earnings of nearly $20 million ahead of their SPAC, with 39% year-over-year growth driven primarily by their fund administration services (up 201%). The company now services 650 active funds, validating their strategy of providing traditional back-office services before moving clients to tokenization.
• The Clarity Act passed Senate Banking Committee with a bipartisan 15-9 vote, though only two Democrats supported it, raising questions about whether it can secure the 60 votes needed for Senate passage. The bill would codify the division of regulatory authority between the CFTC and SEC for crypto assets, but faces headwinds from Democratic concerns about ethics provisions. Headwinds so strong, in fact, Polymarket is down to a 50% chance of passage by year end.

• Bloomberg reported on the SEC's innovation exemption framework, initially suggesting broad permissions for synthetic token derivatives, though Commissioner Hester Peirce later clarified the scope would be more limited to regulated entity structures similar to existing tokenized asset models.

• Ondo's Global Markets platform reached $1 billion in total value just eight months after launch, adding to their existing billion-dollar flagship products USDY and OUSG. The milestone demonstrates strong institutional demand for tokenized securities platforms.
• Circle announced their Arc network presale, raising $222 million from A16z, BlackRock, Apollo, and ARK Invest at a $3 billion implied valuation. This marks the first time a public company has executed a token presale, with Circle's stock price rising on the announcement. The tokenomics split 25% to Circle, 60% to network contributors, and 15% to long-term reserves, creating a blueprint for other public companies considering similar moves.
• Solana Foundation launched their Developer Platform, providing institutions with a click-to-deploy interface for tokenized assets, stable coins, and payment coordination with customizable transfer rules and compliance features.
• Commissioner Hester Peirce announced she will leave the SEC in November to join Regent University School of Law as a professor, ending an eight-year tenure that saw unprecedented crypto guidance development and consistent advocacy for clear regulatory frameworks during uncertain times.

Tweet of the week

"The crypto market structure bill has PASSED the Senate Banking Committee with a bi-partisan vote! Historic day for crypto and for the future of digital assets in America. Grateful for the countless hours from lawmakers and staff to strengthen this legislation. Big improvement"
-- @brian_armstrong (Brian Armstrong)

Crypto Mom Says Goodbye

We learned this week that Commissioner Hester Peirce will be leaving the SEC in November to join Regent University School of Law as a professor. This officially ends an era at the SEC that saw more crypto guidance issued in a single year than the previous eight combined. The big burning question on all of our minds is how we can audit literally any class she's teaching.

Seriously though - Commissioner Peirce deserves a very special shout out for everything she's done while at the Commission.

During the Gensler years, when the SEC refused to engage in rulemaking and instead governed through enforcement actions, Commissioner Peirce was the lone voice pushing back. She consistently argued that the SEC is a rulemaking agency with an enforcement arm, not the other way around. That took tremendous courage given the political dynamics.

Her legacy will be that crypto capital markets found their footing in the United States. Reinforcing almost a century of leadership in capital markets dominance and innovation. The guidance that came (and will come) out of her task force created the framework that serious institutional players are now using to bring trillions of dollars on-chain. The industry owes her a debt of gratitude that will be felt for decades.

This week we also dove deep into Circle's groundbreaking Arc network presale and what it means for the future of corporate tokenization. We also analyzed the CLARITY Act's chances of passage (including the ethical reasons why CLARITY's passage is a long shot), and the wave of new tokenized fund filings from JP Morgan, BlackRock, and Fidelity. Charlie just returned from an epic backcountry adventure in Zion, and we covered the infrastructure buildout that's preparing traditional finance for infinite onchain liquidity.

The episode is available below and we've summarized it for you here.

Stay ahead of the curve

Be sure to follow us on X, LinkedIn, and Spotify for real-time updates, behind-the-scenes insights, and the occasional hot take that didn't make it into the Progress Bar or the First Trillion podcast episode or summary.

Until next week,

The TAC Team