Bitcoin Coinbase Premium At Rare Discount As US Demand Weakens

A senior executive at Coinbase has warned that U.S. lawmakers risk handing a strategic advantage to global rivals if they limit rewards on U.S.-issued stablecoins, as China moves to pay interest on its central bank digital currency (CBDC), the digital yuan. 

In a post on X on Tuesday, Faryar Shirzad, Coinbase's chief policy officer, said the debate over whether U.S. dollar stablecoins should be allowed to offer yield under the GENIUS Act has taken on greater urgency after China's central bank announced it will allow banks to pay interest on the digital yuan.

"For those who misunderstand what's at stake," Shirzad wrote, pointing to China's move as evidence that the competitive landscape for digital money is evolving.

"Tokenization is the future and the GENIUS Act was a visionary move by POTUS and Congress to ensure U.S. dollar stablecoins issued under U.S. rules would be the primary settlement instrument of the future," said Shirzad.

He cautioned that if Senate negotiations over the market structure bill mishandle the issue of stablecoin rewards, it could give global rivals "a big assist" by giving non-U.S. stablecoins and CBDCs a meaningful competitive edge. 

"Lobbyists for entrenched incumbents will always fight change," Shirzad added. "It's critical for negotiators to protect the primacy of the U.S. dollar and the U.S. financial system, not just incumbent interests."

China's CBDC push

Shirzad's comments come as China prepares a significant shift in its CBDC strategy aimed at boosting adoption of the e-CNY, which has struggled to gain widespread consumer traction despite years of pilot programs. 

The People's Bank of China announced earlier this week that it will allow commercial banks to pay interests on clients' digital yuan holdings under a new framework set to take effect on Jan. 1, 2026.

Under the new policy, the e-CNY will transition from functioning as digital cash to operating as "digital deposit currency," said PBOC Deputy Governor Lu Lei.

Debate over incentives

The GENIUS Act, passed into law in July, bars issuers of U.S. dollar payment stablecoins from paying interest or yield directly to holders, aiming to keep stablecoins focused on payments.

The current debate centers on how strictly that ban should be applied. Crypto firms argue that limiting rewards could weaken the competitiveness of U.S. stablecoins against foreign alternatives and CBDCs, while banking groups are urging regulators to enforce a broad prohibition.

In a Dec. 18 letter, the Blockchain Association and over 125 crypto industry participants urged Congress to reject efforts to expand the GENIUS Act's prohibition on interest or yield. "Claims that stablecoin rewards threaten community banks are not supported by evidence," the letter said.

Meantime, the American Bankers Association published a separate letter the same day, calling on lawmakers to strictly enforce the GENIUS Act's ban on yield-bearing stablecoins, arguing that some crypto exchanges are interpreting the law in ways that allow reward-like incentives and could undermine traditional banking activity.

Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.

© 2025 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Pakistan is moving faster on crypto adoption than many expect. Former Binance CEO Changpeng Zhao (CZ) says the country is laying strong foundations to become a major crypto hub by 2030, citing rapid policy action and execution throughout 2025. While several governments remain cautious, Pakistan’s approach points to long-term planning rather than trial-and-error experimentation.

Bitcoin Mining and Energy Monetization Strategy

A key step has been Pakistan’s decision to allocate 2,000 megawatts of surplus electricity to Bitcoin mining and AI data centers. Instead of wasting excess power, the government is using mining as a tool for energy monetization and industrial growth. This reframes Bitcoin mining as digital infrastructure, supported by legal and incentive frameworks aimed at long-term viability.

Pakistan has also entered strategic discussions with Binance on a potential framework that could unlock nearly $2 billion in investment. These talks reflect an effort to attract global capital while keeping operations within a regulated structure.

Crypto Regulation and Government Policy Progress

Regulatory clarity has played a central role. The launch of the Pakistan Virtual Assets Regulatory Authority signals a move away from uncertainty, giving crypto businesses defined rules to operate under. Major exchanges, including Binance and HTX, have been permitted to operate locally, strengthening confidence among users and institutions.

There have also been discussions around building a state-level Bitcoin reserve, indicating that digital assets are now part of broader policy planning rather than sidelined innovation.

CZ has repeatedly pointed out that speed is Pakistan’s advantage. With a young, tech-literate population and policymakers willing to act quickly, he believes the country could rank among the top global crypto markets within five years if execution continues.

Tokenization of Stock Markets and Capital Access

Tokenization is another pillar of Pakistan’s strategy. CZ argues that tokenizing the stock market could allow international investors to access Pakistani equities through blockchain-based assets. This could improve liquidity, lower entry barriers, and channel foreign capital more efficiently than traditional systems. Countries that move early on tokenization, he says, will gain a lasting edge.

Focus on Blockchain Infrastructure Over Speculation

Pakistan is not being marketed crypto—it is being positioned to build it. The emphasis is on regulation, tokenization, builders, and economic rails rather than hype-driven trading. If executed well, crypto could become core digital infrastructure instead of a speculative side market.

CZ also highlighted blockchain’s lower barriers for entrepreneurs. Unlike banking or AI, which require large capital and access to data, blockchain enables small teams to build without heavy gatekeeping. However, he emphasized that education, incubators, and university-led programs will be crucial to transforming policy momentum into sustained innovation.

Pakistan’s Long-Term Crypto Vision

Taken together, Pakistan’s moves point to a deliberate bet on crypto as infrastructure. If current momentum holds, the country could reshape its digital economy and emerge as a serious global crypto player by the end of the decade.

FAQs

Pakistan has established a Virtual Assets Regulatory Authority, providing clear rules for crypto businesses and allowing major global exchanges to operate locally under a regulated framework.

Yes, with rapid policy action, a young tech-literate population, and strategic focus on blockchain infrastructure, Pakistan is laying strong foundations to rank among top global crypto markets by 2030.

Pakistan is prioritizing regulation, tokenization, and builder ecosystems to embed crypto as core digital infrastructure for long-term economic growth, rather than just promoting speculative trading.

Ugandan politician and opposition leader Bobi Wine is encouraging his constituents to download Jack Dorsey’s decentralized peer-to-peer messaging service, Bitchat, in the lead-up to the country’s election, alleging the ruling party will try to cut off communication services.

During the 2016 election, long-time Ugandan President Yoweri Museveni blocked internet and social media access for the entire population, citing security and safety concerns, and again in 2021, according to a report from the Pan-African Human Rights Defenders Network.

Wine alleged in a X post on Tuesday that a similar action is on the agenda in the lead-up to the Uganda 2026 presidential election, which is scheduled for January 15.

“They switch off the internet in order to block communication and ensure that citizens do not organise, verify their election results and demand for accountability over the massive election theft,” he said.

According to recent data, the top four exchanges (Upbit, Binance, Bithumb, and Uphold) control the vast majority of the exchange-held supply.

The combined market share of these four crypto giants stands at an enormous 80%. Together, they hold roughly 12.3 billion XRPs. 

There is also a drop-off after fourth place. There is a 1.1 billion difference between Uphold and Bitbank. 

South Korean dominance 

The data shows that Upbit is the clear outlier. The South Korean exchange 2.5x more XRP than the world’s largest exchange, Binance. This is a known market phenomenon specific to XRP. In South Korea, XRP is exceptionally popular among retail investors. 

This heavy accumulation is frequently linked to the Kimchi Premium.

Binance is typically in first place for most assets, for XRP it sits firmly in second place. Its 21 wallets show a complex custody structure. 

The presence of Bithumb in third place clearly shows the Korean dominance. Combined with Upbit, these two South Korean exchanges alone control over 52% of the XRP represented on this list.

XRP-friendly exchange 

Uphold has historically positioned itself as an "XRP-friendly" exchange. It supported the asset during periods when other US exchanges delisted it due to SEC litigation. Hence, their high ranking is not even remotely surprising. 

In fact, as reported by U.Today, XRP was the most traded cryptocurrency on the exchange. 

XRP ETF share 

In the meantime, the share of the XRP supply controlled by exchange-traded products currently stands at only 1%. The percentage might not seem impressive, but these products have had successful launches. 

Bitcoin and the broader cryptocurrency market are entering the New Year under pressure after the Federal Reserve released the minutes from its December policy meeting. While the Fed delivered a rate cut last month, the message that followed was far less supportive for risk assets. Policymakers made it clear they see little urgency to ease further anytime soon.

FOMC Minutes Update: Rate Cuts Take a Back Seat, for Now

The December minutes suggest the Fed is comfortable hitting pause after its recent 25-basis-point cut. Several officials said holding rates steady for a while would allow time to measure the delayed impact of earlier easing on both inflation and the labor market. While markets had already ruled out a January cut, the minutes also dampened hopes for a quick move in early 2026.

According to interest rate futures, a cut in March now looks unlikely, pushing realistic expectations toward April at the earliest. This “higher for longer” outlook is weighing on investor confidence across risk assets, including crypto.

Several Fed members pointed to recent inflation readings as a positive sign. Consumer price data for November showed headline inflation easing to 2.7% year over year, with core inflation at 2.6%, both below expectations. These figures suggest inflation is edging closer to the Fed’s long-term 2% target.

That said, not everyone is convinced the trend is fully reliable. Some officials warned that recent data may be distorted, particularly due to temporary factors like the US government shutdown. Because of this uncertainty, policymakers are hesitant to rush into further cuts without sustained confirmation.

Why it matters for Bitcoin 

Bitcoin has spent recent weeks trading in a narrow band between roughly $85,000 and $90,000. Repeated attempts to reclaim higher resistance levels have failed, reflecting fragile sentiment and cautious positioning.

Trading volumes across the crypto market remain subdued, pointing to a lack of conviction among both retail and institutional participants. December’s pullback appears to have cooled risk appetite, with investors waiting for clearer macro signals before stepping back in.

Labor Market Risks Acknowledged, But Not Enough

While Fed officials flagged rising downside risks to employment, including slower hiring and growing strain on lower-income households, most preferred to wait for more data before adjusting policy again. The December cut itself was described by some as a close call, highlighting how divided the committee remains.

It will be all about Crypto…

For crypto markets, the takeaway is straightforward. Elevated real yields and tight liquidity conditions leave few near-term catalysts for a sustained rally. Bitcoin’s current consolidation reflects this uncertainty, as traders weigh long-term easing expectations against short-term macro headwinds.

Unless inflation shows meaningful improvement or labor conditions deteriorate sharply, crypto prices may continue to struggle for direction in the early months of 2026.

FAQs

The minutes signal fewer near-term rate cuts, keeping liquidity tight. That pressures Bitcoin by reducing risk appetite and delaying a strong upside breakout.

Gradually easing inflation helps long term, but without rate cuts or liquidity growth, the short-term impact on crypto prices remains limited.

Without meaningful improvement in inflation or a sharp labor market downturn, tight liquidity may cause crypto to struggle for direction in early 2026, awaiting clearer macroeconomic signals.

Key signals include inflation trends, labor market data, and Fed guidance, as these will shape liquidity conditions and crypto market direction.

As we approach the final day of a massive year for the crypto industry, a recent report revealed that the sector has lost nearly $3 billion amid the emergence of new trends from malicious actors and growing security complexities.

2025 Crypto Losses Increase By 45%

On Tuesday, blockchain security firm SlowMist shared its 2025 Blockchain Security & AML Annual Report, highlighting the severe security challenges the crypto industry faced throughout the year.

According to SlowMist, the total value stolen from crypto hacks increased by 46% in 2025 compared to 2024, a trend previously noticed by earlier reports. Notably, crypto theft had been more devastating by the first half of this year than the entirety of 2024.

A Mid-Year report by Chainalysis showed that 2025’s activity by the end of June revealed a significantly steeper trajectory into the end of the first half than any previous year, with an alarming velocity and consistency.

Now that the year is near its end, security incidents have cost approximately $2.935 billion, according to SlowMist data, significantly surpassing the $2.013 billion in losses from the previous year.

However, the number of incidents dropped year-over-year (YoY) despite the total amount of losses increasing, signaling a trend of fewer but larger-scale crypto heists. The number of incidents declined by 51%, with 200 cases in 2025. In comparison, 2024 saw 410 reported hacks.

The report shared that DeFi remained the most frequently targeted sector this year, with 126 security incidents, accounting for approximately 63% of all hacks and total losses of around $649 million. This represents a 37% and 62% YoY decrease from 2024’s 339 incidents and $1.029 billion in losses, respectively.

Meanwhile, Centralized exchange (CEX) platforms reported 22 incidents, which accounted for $1.809 billion in losses, led by Bybit’s hack. The February attack resulted in approximately $1.46 billion being stolen in a single incident, becoming the most serious and largest security event of the year.

Regulatory Enforcement Strengthens

Although phishing remained one of the most active schemes, scams and intrusive attacks continued to evolve in 2025, noted SlowMist. Therefore, scams have become more deceptive and difficult to detect, with malicious actors no longer relying on a single method of attack to deceive victims:

However, the report highlighted that crypto enforcement and sanction actions worldwide displayed a “clear trend of escalation” this year, as regulatory and law enforcement agencies directly intervened “in key areas of crypto-related money laundering, fraud, sanctions evasion, and illicit financing.”

Notably, there were 18 incidents this year in which lost funds were recovered or frozen. In these cases, the total stolen funds totaled to $1.95 billion, of which nearly $387 million was successfully returned or frozen.

SlowMist concluded that “the development of the Web3 industry will no longer rely solely on technical innovation. (…) Organizations that can build stronger internal security controls, more transparent fund governance models, and more comprehensive KYT/AML review capabilities will gain longer-term resilience in the next cycle.”