Money20/20, tokenized deposits and OCC updates

Simon’s takeaway from Money20/20 is how grown-up the conversation about AI and stablecoins had become. Compared with 2021, few crypto companies bought the big sponsorships. The ones there were mostly infrastructure firms, and payments companies and enterprises wanted to get on with it, while banks still lean towards tokenized deposits. Dan, back for the first time in about ten years, saw two themes: AI first, with everyone wanting an agentic story, and stablecoins second, on more booths than he expected, including companies he hadn’t known were working with them. Simon adds that on AI, everyone is manoeuvring over which standards to own or support, while stablecoins now have a business case of their own as one more rail most payment providers support.

JPMorgan brought its deposit token, JPMD, to Ethereum, its second public chain after Base. Simon explains the use case: crypto-native institutional clients such as stablecoin issuers and hedge funds want to off-ramp stablecoins through their bank, but the bank would rather not hold someone else’s stablecoin. Ethereum has the most liquidity and, unlike Base with Coinbase, no single counterparty behind it, which makes the signal bigger. He expects banks to follow their clients, and JPMD to appear on more chains. Dan calls it an Overton window shift that tells other banks this is fine. Capital rules make holding stablecoins at rest unattractive for a bank, he notes, while tokenized deposits fit the rules banks already work under, and after years of consortiums and meetings, actually shipping is what matters.

The OCC has issued its final rule under the GENIUS Act. Dan’s reading is that rewards tied to activity and to using a product can be shared with a platform’s customers, while a straight pass-through of yield can’t. Simon wonders whether the push to settle those details in the Clarity Act backfired and simply left the status quo in place. The rule leans on facts and circumstances, he says, which leaves room for interpretation, and credit card cashback, once controversial, is a strong precedent for activity-based rewards. Many stablecoin card programs already pay their rewards as cashback.

Dan argues that money is fungible: even without paying yield directly, a fintech can use its stablecoin margin to price everything else better, from free trades to, one day, a cheaper mortgage for customers who keep a balance with it. Simon points to Chime and SoFi, which have long competed on differentiated pricing. Stablecoins take that model global, he says, especially for platform businesses, and he wonders whether enterprise adoption is moving from early adopters to the early majority.