Plus: Stablecoins could break into the $1T derivatives market

GM. Markets blended smoother than a $12 açai bowl. Still tastes like regret.

Here's the serving:

🍍 Fed Chair Powell is cautious.

💸 Stablecoins as collateral.

🍋 Kraken crypto picks, CZ denies outside investors in $10B fund + more

🍍 Market flavor today

Crypto Market Cap: $3.90T -0.01% (24H)
Name		Price	24H	7D
	Bitcoin BTC	$113,558.47	0.70%	-2.02%
	Ethereum ETH	$4,195.23	0.17%	-6.80%
	XRP XRP	$2.91	1.62%	-3.53%
	BNB BNB	$1,017.62	0.22%	7.01%
	Solana SOL	$215.05	-1.50%	-8.41%

Fed Chair Jerome Powell gave a speech in Rhode Island yesterday, a week after the US Fed cut interest rates by 25 bps.

Traders were watching this speech to get clues on how the future of US monetary policy might look - and if you had to sum it up in one word, it'd be careful.

Powell described the current policy stance as "modestly restrictive," meaning rates are still high enough to put some brakes on the economy, but less so than they were before the cut.

Going forward, he made it clear that the Fed isn't planning to aggressively cut rates anytime soon, because there's "no risk-free path" here:

👉 Cut rates too much → inflation could surge back up;

👉 Cut too little → economy could weaken further.

JPow said that each rate decision will depend on the actual data they're seeing - employment numbers, economic growth, inflation readings, the whole picture.

No autopilot, just careful analysis of what's actually happening in the economy.

Now, this whole cautious vibe from Powell made investors a bit nervous about riskier investments - and crypto felt it:

👉 The total crypto market cap dropped ~1.2%;

👉 Bitcoin fell to around $111K.

A decline, but nothing too dramatic. After all, Powell still is inclined toward lowering the rates, he just won't go crazy go stupid with it.

Measure twice, cut once. Or whatever.

🥝 Memecoin harvest

Forget caffeine - these gains are the real energy boost your wallet needed ☕️

Data as of 06:30 AM EST.

Check out these memecoins and plenty more here.

💸 Stablecoins as collateral

Welcome back to our show, "The US Trying to Make Stablecoins Part of Mainstream Finance"! 🎉

In today's episode: the Commodity Futures Trading Commission (CFTC) announced that they wanna approve stablecoins as collateral in derivatives trading.

Translation of what that actually means:

The derivatives market is where traders make bets on what the price of stuff will be in the future - things like oil, wheat, or Bitcoin.

To make these bets, you have to put down something called collateral, which is like a deposit that proves you can cover your side of the deal.

Right now, collateral in most cases is limited to very safe and highly liquid assets: things like cash, US Treasuries, and other top-quality government bonds.

And the CFTC is considering adding stablecoins to that list.

Which could be huge, and here's why 👇

The derivatives market moves trillions of dollars daily. Yes, TRILLIONS.

To put that in perspective, the entire stablecoin market today is ~$200B in size. So if stablecoins got approved as collateral, they'd gain access to a market waaay bigger than the one they currently serve.

Which would result in:

1️⃣ New demand channels

Right now, stablecoins are mainly used for trading within the crypto ecosystem.

If they were approved as collateral in derivatives, institutions would have a legit reason to hold and move them for regular mainstream financial contracts as well.

Sure, not every company is gonna jump in on this right away - but the door is now open for adoption at a scale that simply didn't exist before.

2️⃣ Integration with market infrastructure

Clearinghouses and settlement systems - the backbone of the derivatives market - would now need to handle stablecoins as part of their daily operations.

That means stablecoin technology would plug directly into the core systems that run global finance, not just crypto platforms.

Now, I know this might sound a bit boring.

But stuff like this is how you get TradFi used to blockchain.

And once they're hooked, well... number go up. Ain't nothing boring about that 😏

🍋 News drops you can't miss

🐙 Curious which cryptos on Kraken are actually worth a look? From Bitcoin to memecoins, we've laid it all out for you here.

💼 Changpeng Zhao clears the air: his company, YZi Labs, isn't planning to let outside investors into its $10B fund.

⚖️ A US court turned down Tron founder Justin Sun's attempt to stop Bloomberg from publishing details about his crypto portfolio. That means Bloomberg can go ahead and release the estimated numbers.

📊 The SEC's working on a policy that'd let crypto products hit the market faster. They're calling it an "innovation exemption," and it's supposed to drop before the end of December.

🛑 UXLink, a Web3 social app that uses AI, got hacked... then the hacker got scammed.

🍌 Juicy memes