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A rebellion at the Federal Reserve — can it avoid the next bank collapse?
June 29, 2023
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Bank regulation gets far fewer headlines than monetary controls, but it has just as much to do with the future of the economy.

Every financial conflagration over the last century has been followed by a soul-searching review of how it could have been prevented, followed by adjustments in regulation that promise things will be better in the future. Inevitably, bank executives are accused of being reckless and taking risks they would not have taken if they just had been subject to even more penalties than they already are. And regulators reluctantly admit they could have done a better job if Congress had given them just a few more powers than the vast constellation they already have.

The Federal Reserve Board’s report on the failure of Silicon Valley Bank overseen by Vice Chair for Supervision Michael Barr follows this script. But as Barr now initiates a new six-month review to overhaul Federal Reserve bank supervision, an uncharacteristic rift at the Fed has appeared.

In a speech made in Salzburg, Austria, Fed Governor Michelle Bowman threw cold water on the vice chair’s prior assessments and, by implication, his future review. Having apparently exhausted her collegial patience within the inner walls of the Fed, she publicly called for an independent review by a third party of recent bank failures, given that much of the work on the SVB report “was prepared internally […] relying on a limited number of unattributed source interviews.” She revealed that it was the work product of only one board member, with no opportunity for review by other Fed governors prior to its highly anticipated public release.

Expectations for any meaningful corrective action coming out of any new review by the Fed should be low. Barr has said that the Fed will rely heavily on, among other things, his SVB report and a 2009 report from the New York Fed on the future of supervision. The former dodges many of the main issues the bank’s collapse raised while straining to blame the prior administration for the supervisory lapses by its San Francisco Bank over the last three years. The latter has a lofty consultant’s feel that suggests dealing with systemic risk culturally and psychologically, a perspective that Barr explains intrigues him because some of the most important work that he has done has been “in collaboration with a behavioral economists.”

Governor Bowman correctly argues that there are more critical questions at stake beyond the perennial go-to issue of the appropriate level of bank capital. While she doesn’t say it, it is apparent that the country’s financial stability relies on the effectiveness of a nearly 100-year-old system of financial oversight that is hopelessly out of date. Since regulation turns on what a financial company calls itself rather than what it does, shadow banks like nonbank lenders, fintechs, crypto companies and various funds produce much of the financial risk in the system but go largely unregulated. That disconnect between risk and regulation has become an increasingly significant threat to the U.S. economy.

Bowman’s speech raises questions of regulatory transparency and effectiveness — a great question given that the Fed Board and its staff in Washington, D.C., write bank rules, orchestrate interest rates and oversee the supply of money while its 12 Federal Reserve Banks regulate and lend to members whose CEOs sit on the boards of those reserve banks. This arcane structure slavishly relies on historic data and financial proxies such as stress tests, capital ratios and liquidity requirements, which come up short in terms of actually anticipating and preventing financial disasters.

To put a finer point on it, if Google or Meta regulated banks, they would bring vast amounts of technological firepower and huge databases to bear in real time to make policy decisions that impact the present and future health of financial companies. Nothing close to that happens today.

Vice Chair Barr has recently joined Congress and the chorus of bank critics in suggesting that greater executive accountability is needed, notwithstanding that banking is a business where executive accountability is surpassed by no other. Fair enough, but there should be no less a standard of accountability for regulators that fail to do their jobs. So far, there is no evidence of that. Moreover, the board itself now seems to be at odds over the reliability of the facts that have been presented to the public about the SVB collapse.

Given the narrow escape the banking system just had, we need a credible, independent evaluation of the current strengths and deficiencies of the current Fed’s system of oversight and how it can be far better prepared for the next crisis. Better yet, we need a bipartisan set of recommendations on how to reconstruct a comprehensive financial regulatory system that can effectively deal with the risks and rewards of the 21st century. I am not holding my breath for either.

Thomas P. Vartanian is the author of “200 Years of American Financial Panics” and “The Unhackable Internet.” He is a former federal bank regulator, and currently executive director of the Financial Technology & Cybersecurity Center.

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🚀 Bitcoin Hits New All-Time High – What’s Next?

Bitcoin reached a new peak of $118,254 on July 11, 2025, driven by institutional demand, favorable macro conditions, and supportive crypto regulations. With a 100%+ year-over-year surge, what's next for BTC?

🔮 Bitcoin Outlook

📆 Short Term (6–12 Months)

  • Expect volatility post-ATH
  • Spot BTC ETFs attract significant capital
  • Potential range: $95K–$135K

🕰 Medium Term (1–3 Years)

  • 2024 halving impact continues
  • More institutions may adopt BTC as reserve/collateral
  • Global regulatory clarity boosts confidence
  • Potential range: $120K–$200K+

🌐 Long Term (5–10+ Years)

  • BTC may solidify as digital gold
  • Used in cross-border settlements and emerging markets
  • Scarcity (21M cap) drives value
  • Bullish case: $250K–$1M+
  • Bearish case: $20K–$50K (if tech/regulatory risks rise)

📌 Key Drivers

  • Institutional adoption
  • Spot ETF flows
  • Crypto regulations
  • Fed interest rate policy
  • Lightning Network & Layer 2 scaling
  • Geopolitical uncertainty

💬 TL;DR:
Bitcoin’s $118K breakout ...

00:00:07
Ripple CEO on partnership with BNY to serve as custodian of stablecoin
00:01:12
Brad Garlinghouse In Washington 🚀

It’s time for a fair and open level playing field.

Under Gary Gensler it was quite the opposite.

  • Brad Garlinghouse
    July 9, 2025
00:01:56
👉 Coinbase just launched an AI agent for Crypto Trading

Custom AI assistants that print money in your sleep? 🔜

The future of Crypto x AI is about to go crazy.

👉 Here’s what you need to know:

💠 'Based Agent' enables creation of custom AI agents
💠 Users set up personalized agents in < 3 minutes
💠 Equipped w/ crypto wallet and on-chain functions
💠 Capable of completing trades, swaps, and staking
💠 Integrates with Coinbase’s SDK, OpenAI, & Replit

👉 What this means for the future of Crypto:

1. Open Access: Democratized access to advanced trading
2. Automated Txns: Complex trades + streamlined on-chain activity
3. AI Dominance: Est ~80% of crypto 👉txns done by AI agents by 2025

🚨 I personally wouldn't bet against Brian Armstrong and Jesse Pollak.

👉 Coinbase just launched an AI agent for Crypto Trading
PERSISTENCE Q2 SUMMARY & WHATS TO COME IN Q3 👀

Q2’25 was a significant one as we laid the groundwork for multiple initiatives on our orange-themed road to BTCFi 🛣️🧡

From being one of the first DEXs to deploy on Babylon, to going live with the beta-mainnet & onboarding new Persisters.

Read more 👉 https://blog.persistence.one/2025/07/10/persistence-one-a-look-back-on-q2-2025-and-an-overview-of-whats-to-come-in-q3/

BTC Interop beta mainnet is back 🧡
🚀 XDC Goes Omnichain with LayerZero & Stargate!

XDC Network has officially launched omnichain bridging via LayerZero Labs and Stargate, enabling seamless $XDC transfers across Ethereum, Solana, Arbitrum, Base, and more using the OFT (Omnichain Fungible Token) standard—live now on Stargate Finance.

🔑 Key Features

  • Zero slippage: Bridge $XDC with no loss of value during transfers.

  • Unlimited transfer size: Move any amount of XDC across supported chains.

  • Access to millions: Instantly tap into new users and ecosystems across DeFi[2][6.

💡Why This Matters

  • $2.9B in gas token value: XDC Network’s massive liquidity is now accessible cross-chain, expanding its footprint in DeFi and real-world asset tokenization.

  • OFT standard: The OFT protocol ensures unified, secure, and permissionless movement of assets between blockchains, powered by LayerZero’s advanced interoperability layer.

  • Stargate integration: Users can bridge XDC instantly, with zero slippage and no arbitrary limits, leveraging Stargate’s ...

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Musk Turns On Starlink to Save Iranians from Regime’s Internet Crackdown

Elon Musk, the world’s richest man and a visionary behind SpaceX, has flipped the switch on Starlink, delivering internet to Iranians amid a brutal regime crackdown.

This move comes on the heels of Israeli strikes targeting Iran’s nuclear facilities, as the Islamic Republic cuts off online access.

The former Department of Government Efficiency chief activated Starlink satellite internet service for Iranians on Saturday following the Islamic Republic's decision to impose nationwide internet restrictions.

As the Jerusalem Post reports, that the Islamic Republic’s Communications Ministry announced the move, stating, "In view of the special conditions of the country, temporary restrictions have been imposed on the country’s internet."

This action followed a series of Israeli attacks on Iranian targets.

Starlink, a SpaceX-developed satellite constellation, provides high-speed internet to regions with limited connectivity, such as remote areas or conflict zones.

Elizabeth MacDonald, a Fox News contributor, highlighted its impact, noting, "Elon Musk turning on Starlink for Iran in 2022 was a game changer. Starlink connects directly to SpaceX satellites, bypassing Iran’s ground infrastructure. That means even during government-imposed shutdowns or censorship, users can still get online, and reportedly more than 100,000 inside Iran are doing that."

During the 2022 "Woman, Life, Freedom" protests, Starlink enabled Iranians to communicate and share footage globally despite network blackouts," she added.

MacDonald also mentioned ongoing tests of "direct-to-cell" capabilities, which could allow smartphone connections without a dish, potentially expanding access and supporting free expression and protest coordination.

Musk confirmed the activation, noting on Saturday, "The beams are on."

This follows the regime’s internet shutdowns, which were triggered by Israeli military actions.

Adding to the tension, Israeli Prime Minister Benjamin Netanyahu addressed the Iranian people on Friday, urging resistance against the regime.

"Israel's fight is not against the Iranian people. Our fight is against the murderous Islamic regime that oppresses and impoverishes you,” he said.

Meanwhile, Reza Pahlavi, the exiled son of Iran’s last monarch, called on military and security forces to abandon the regime, accusing Supreme Leader Ayatollah Ali Khamenei in a Persian-language social media post of forcing Iranians into an unwanted war.

Starlink has been a beacon in other crises. Beyond Iran, Musk has leveraged Starlink to assist people during natural disasters and conflicts.

In the wake of hurricanes and earthquakes, Starlink has provided critical internet access to affected communities, enabling emergency communications and coordination.

Similarly, during the Ukraine-Russia conflict, Musk activated Starlink to support Ukrainian forces and civilians, ensuring they could maintain contact and access vital information under dire circumstances.

The genius entrepreneur, is throwing a lifeline to the oppressed in Iran, and the libs can’t stand it.

Conservative talk show host Mark Levin praised Musk’s action, reposting a message stating that Starlink would "reconnect the Iranian people with the internet and put the final nail in the coffin of the Iranian regime."

"God bless you, Elon. The Starlink beams are on in Iran!" Levin wrote.

Musk, who recently stepped down from leading the DOGE in the Trump administration, has apologized to President Trump for past criticisms, including his stance on the One Big Beautiful Bill.

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GENIUS Act lets State banks conduct some business nationwide. Regulators object

The Senate passed the GENIUS Act for stablecoins last week, but significant work remains before it becomes law. The House has a different bill, the STABLE Act, with notable differences that must be reconciled. State banking regulators have raised strong objections to a provision in the GENIUS Act that would allow state banks to operate nationwide without authorization from host states or a federal regulator.

The controversial clause permits a state bank with a regulated stablecoin subsidiary to provide money transmitter and custodial services in any other state. While host states can impose consumer protection laws, they cannot require the usual authorization and oversight typically needed for out-of-state banking operations.

The Conference of State Bank Supervisors welcomed some changes in the GENIUS Act but remains adamantly opposed to this particular provision. In a statement, CSBS said:

“Critical changes must be made during House consideration of the legislation to prevent unintended consequences and further mitigate financial stability risks. CSBS remains concerned with the dramatic and unsupported expansion of the authority of uninsured banks to conduct money transmission or custody activities nationwide without the approval or oversight of host state supervisors (Sec. 16(d)).”

The National Conference of State Legislatures expressed similar concerns in early June, stating:

“We urge you to oppose Section 16(d) and support state authority to regulate financial services in a manner that reflects local conditions, priorities and risk tolerances. Preserving the dual banking system and respecting state autonomy is essential to the safety, soundness and diversity of our nation’s financial sector.”

Evolution of nationwide authorization

Section 16 addresses several issues beyond stablecoins, including preventing a recurrence of the SEC’s SAB 121, which forced crypto assets held in custody onto balance sheets. However, the nationwide authorization subsection was added after the legislation cleared the Senate Banking Committee, with two significant modifications since then.

Originally, the provision applied only to special bank charters like Wyoming’s Special Purpose Depository Institutions or Connecticut’s Innovation Banks. Examples include crypto-focused Custodia Bank and crypto exchange Kraken in Wyoming, plus traditional finance player Fnality US in Connecticut. Recently the scope was expanded to cover most state chartered banks with stablecoin subsidiaries, possibly due to concerns about competitive advantages.

Simultaneously, the clause was substantially tightened. The initial version allowed state chartered banks to provide money transmission and custody services nationwide for any type of asset, which would include cryptocurrencies. Now these activities can only be conducted by the stablecoin subsidiary, and while Section 16(d) doesn’t explicitly limit services to stablecoins, the GENIUS Act currently restricts issuers to stablecoin related activities.

However, the House STABLE Act takes a more permissive approach, allowing regulators to decide which non-stablecoin activities are permitted. If the House version prevails in reconciliation, it could result in a significant expansion of allowed nationwide banking activities beyond stablecoins.

Is it that bad?

As originally drafted, the clause seemed overly permissive.

The amended clause makes sense for stablecoin issuers. They want to have a single regulator and be able to provide the stablecoin services throughout the United States. But it also leans into the perception outside of crypto that this is just another form of regulatory arbitrage.

The controversy over Section 16(d) reflects concerns about creating a regulatory gap that allows banks to operate interstate without the oversight typically required from either federal or state authorities. As the two Congressional chambers work toward reconciliation, lawmakers must decide whether stablecoin legislation should include provisions that effectively reduce traditional banking oversight requirements.

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Dubai regulator VARA classifies RWA issuance as licensed activity
Virtual Asset Regulatory Authority (VARA) leads global regulatory framework - makes RWA issuance licensed activity in Dubai.

Real-world assets (RWAs) issuance is now licensed activity in Dubai.

~ Actual law.
~ Not a legal gray zone.
~ Not a whitepaper fantasy.

RWA issuance and listing on secondary markets is defined under binding crypto regulation.

It’s execution by Dubai.

Irina Heaver explained:

“RWA issuance is no longer theoretical. It’s now a regulatory reality.”

VARA defined:

- RWAs are classified as Asset-Referenced Virtual Assets (ARVAs)

- Secondary market trading is permitted under VARA license

- Issuers need capital, audits, and legal disclosures

- Regulated broker-dealers and exchanges can now onboard and trade them

This closes the gap that killed STOs in 2018.

No more tokenization without venues.
No more assets without liquidity.

UAE is doing what Switzerland, Singapore, and Europe still haven’t:

Creating enforceable frameworks for RWA tokenization that actually work.

Matthew White, CEO of VARA, said it perfectly:

“Tokenization will redefine global finance in 2025.”

He’s not exaggerating.

$500B+ market predicted next year.

And the UAE just gave it legal rails.

~Real estate.
~Private credit.
~Shariah-compliant products.

Everything is in play.

This is how you turn hype into infrastructure.

What Dubai is doing now is 3 years ahead of everyone else.

Founders, investors, ecosystem builders:

You want to build real-world assets onchain.

Don’t waste another year waiting for clarity.

Come to Dubai.

It’s already here.

 

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If you find value in my content, consider showing your support via:

💳 PayPal: 
1) Simply scan the QR code below 📲
2) or visit https://www.paypal.me/thedinarian

🔗 Crypto – Support via Coinbase Wallet to: [email protected]

Or Buy me a coffee: https://buymeacoffee.com/thedinarian

Your generosity keeps this mission alive, for all! Namasté 🙏 Crypto Michael ⚡  The Dinarian

 

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