3 for Web3: What Is the Price for Market Maturation?
A look at stablecoins, token transparency, and blockchain valuation
Three key developments from last week are reshaping the digital asset landscape: regulatory progress on stablecoins, new transparency initiatives in token markets, and evolving frameworks for blockchain valuation. Here's what you need to know.
1. Stablecoin Regulation Advances
The U.S. Senate passed the GENIUS Act last Tuesday, establishing a regulatory framework for stablecoins. This moves us closer to the world's first international stablecoin market. The bill now needs House approval and the president's signature—both likely to happen. Major corporations, including Bank of America, Morgan Stanley, Walmart, Amazon, and PayPal are already preparing to issue stablecoins.
2. Token Market Self-Regulation Concerns
Byron Gilliam questions whether the token market suffers from information asymmetry. In response, Blockworks launched a Token Transparency Framework—a commendable attempt at self-regulation. However, this creates risk: if Blockworks develops close relationships with token projects, transparency could be compromised for mutual benefit. As a media company dependent on trust, Blockworks' credibility is essential. Without it, transparency fails, and the token market returns to square one.
3. Blockchain Valuation Framework
William Mougayar uses lessons from internet company valuations (mid-1990s to 2020s) to propose a model for measuring blockchain value. His framework treats blockchains as economies, measuring their value through velocity and flow metrics. This focuses on valuing the blockchains themselves, not blockchain businesses. The challenge lies in accurately measuring total economic output on individual blockchains similar to measuring a nation’s GDP—a complex but ongoing discussion.
The Future of Web3: Are We Leaning Into Private Money?
These developments highlight crypto’s maturation from experimental technology to regulated financial infrastructure. As stablecoins gain legitimacy, transparency efforts evolve, and blockchain valuation methods improve, institutional adoption will accelerate. Not only that, but we could be rocketing toward an international economic dynamic characterized by the rise of private money. When every major corporation and government entity issues a digital currency, fiat money—whether government-issued or government-endorsed—will decline. Is that the world we want?
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