NYAG USD Stablecoin Restrictions Request

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Good Morning.

The S&P is more bipolar than BTC, and that’s a sentence that I wouldn’t be expecting to write just a few weeks ago. It seems to be clear that confidence in US assets are decreasing amidst the trade war. BTC has a shot to prove its value prop in the coming months.

In Today's Email:

• What Matters: NYAG on Stablecoin Issuers 💵 

• Founders Highlight: Barry of Interchain Labs 🌐 

• Deal Flow: Apollo Backs Plume 🚀 

You read and share. We listen and improve. Send us feedback at [email protected].

TOGETHER WITH

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WHAT MATTERS

NYAG Pushes Stablecoin Curbs on Foreign Issuers

State of play: New York Attorney General Letitia James has called on Congress to restrict stablecoin issuance to US-based companies that are fully regulated under federal and state laws.

• In a letter sent on April 8, James warned that foreign issuers like Tether, which currently holds over $90B in US Treasuries, could pose risks to national financial stability.

• James stressed that stablecoins should be backed 1:1 by US dollars or Treasuries, with reserves held in institutions under US oversight.

• She argued these measures could prevent market turmoil during volatility when mass redemptions might trigger "run on the bank" scenarios and shake the Treasury market.

• The letter comes as Congress debates new stablecoin legislation that could define the role of foreign issuers.

• James noted that Tether, the world’s largest stablecoin provider, lacks a US presence and recently relocated its headquarters to El Salvador.

Meanwhile, Tron’s TRX token has surged 10% over the past three days, defying broader market uncertainty tied to global trade tensions.

• The rally follows Tether’s minting of 1B USDT on the Tron network, signaling strong institutional interest and confidence in the chain.

What’s next: Tether CEO recently said the company is considering launching a US-based stablecoin for institutional clients and is working with a Big Four accounting firm on a full audit.

For builders and investors: Friendlier regulatory environment doesn’t mean that there’ll be legal competition prompted by lobbying efforts.

BUILDER-INVESTOR HIGHLIGHT

Barry Plunkett of Interchain Labs

Intro: Barry Plunkett is the co-CEO of Interchain Labs, the development and growth team for Cosmos, a decentralized network of independent, scalable, sustainable, and interoperable blockchains.

Previous background: Before Interchain, Barry previously worked at D. E. Shaw as a New Ventures Associate, launching startups from scratch.

• Earlier, he was a Reinforcement Learning Researcher at Wharton, with award-winning work on economic games. He holds a BA in Econ & CS from Penn.

The big idea: Interchain just launched IBC Eureka, the big idea behind IBC Eureka is to bridge Ethereum and Cosmos in a fast, affordable, and secure way, creating the first cross-chain connection between Cosmos and a major non-Cosmos network.

• In the long term, the vision is to expand IBC Eureka to other major chains like Solana, Base, and Arbitrum, ultimately creating a unified, interoperable blockchain economy where assets and protocols can move freely.

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INSIGHTS

Trump Overturns IRS Rule Targeting DeFi

State of play: President Trump has signed a resolution overturning an IRS rule from the Biden era that classified DeFi platforms as brokers, requiring them to track and report user activity.

• This marks the first major pro-crypto legislation to pass through Congress, with strong bipartisan support.

• The move blocks the IRS from implementing similar rules and signals growing momentum for crypto-friendly regulation.

• Next on the agenda is stablecoin legislation, which could reach the president’s desk by August.

DEAL FLOWS

Apollo Backs Plume to Tokenize RWAs

Deal flows soared this week - we saw $1.4B in deals 💼 

Plume, a blockchain platform for real-world assets (RWAs), secured a seven-figure investment from Apollo Global Management to scale its infrastructure.

• The Ethereum-compatible protocol aims to make traditional assets like bonds and carbon credits usable in crypto markets for lending, trading, and more.

• Plume recorded over 18M wallets on its testnet.

• Plume’s partnership with Apollo highlights rising institutional interest in tokenized asset infrastructure.

Deal flows in the past week:

• Sats Terminal, $1.7M Pre-Seed Round

• Lyzi, $1.4M Seed Round

• Firefish, $1.8M Seed Round

• P2P me, $2M Seed Round

• Octane Security, $6.75M Seed Round

• Cap Labs, $8M Seed Round

• Codex, $15.8M Seed Round

• Meta Era, $40M Pre-A Round

• DecentralGPT, $3M Series A

• Meanwhile, $40M Series A

• Blackbird, $50M Series B

• Towns Protocol, $10M Series B

• CAP, $1.1M Community Round

• Hidden Road, $1.25B M&A

QUICK BITES

• Trump's tariff effect tumbled crypto volumes in Q1.

• US Senate votes to confirm Paul Atkins to lead the SEC.

• Spot Bitcoin ETFs see $127M in outflows amid market rally.

• SEC drops unregistered securities claims against Nova Labs.

• South Korean banks call for relaxed crypto partnership rules.

• Trump signs resolution to repeal controversial IRS crypto rule.

• US Senate Democrats condemn DOJ for dropping crypto unit.

• NYAG warns Congress of non-US stablecoin issuers like Tether.

• Interchain Labs launches IBC Eureka to connect Ethereum to Cosmos.

• Dorsey's Block, Inc. settles for $40M with NY regulator over AML failures.

• Grayscale & Osprey settle legal dispute over Bitcoin ETF marketing practices.

NOTEWORTHY READS

• Jani’s read on Berabundance.

• Decentralised’s read on networks in crypto VC.

• Vitalik’s read on a maximally simple L1 privacy roadmap.

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Disclaimer: All the information presented in this publication and its affiliates is strictly for educational purposes only. It should not be construed or taken as financial, legal, investment, or any other form of advice.