Banks Are Panicking Over Stablecoin Yields — And It Shows

Good Friday! In today’s edition:

• 🏦 Stablecoin yield spooks banks and sparks lobbying blitz

• 🧹 X cleans house, forcing crypto engagement platforms to pivot

Today’s newsletter is brought to you by Fuse!

FUSE ENERGY HITS A $5B VALUATION FOLLOWING A $70M SERIES B

Fuse Energy is a $400M ARR utility powering 200,000+ homes, and has recently announced a $70M series B at a blockbuster $5B valuation.

This comes after the recent beta launch of The Energy Network, a new digital layer engineered to scale our grids and save billions in costs.

And now, it’s just building momentum:

• $170M raised to date

• $5B valuation

• Beta live on Solana

• Landmark SEC no-action letter secured

• Planning listings for early 2026

A new foundation for the grid is coming.

Check out their announcement here and follow Fuse on X for updates.

Banks Push Back as Stablecoin Yields Threaten Deposit Flows

The banking industry’s discomfort with stablecoins hit full volume this week, after Bank of America CEO Brian Moynihan warned that up to $6 trillion in deposits could leave the banking system if stablecoins are allowed to pay interest. That’s nearly a third of all U.S. commercial bank deposits, and clearly a scenario banks want to avoid at all costs.

Moynihan’s message is simple: if stablecoins offer yield, banks lose their edge. Depositors might choose to earn 4% on-chain rather than 0.1% in a savings account. That shift would force big banks to borrow from the Fed at market rates, rather than living off your idle deposits.

So banks are lobbying hard. A Senate draft bill now includes a ban on interest for merely holding stablecoins, a move framed as consumer protection, but which critics argue is just propping up a broken banking model. Passive yield would be banned, but staking and liquidity rewards might still be allowed.

Let’s be clear: this is about control. Banks fear real competition. They fear losing lending volume to DeFi. But consumers stand to gain through better yield, more choice, and fewer middlemen deciding what your money can earn.

X Bans Incentivized Posting Apps, Prompting Shakeup in Crypto Engagement Platforms

In a long-awaited move to clean up spam and bot-driven content, X (formerly Twitter) announced Thursday that it has revoked API access for apps that pay users to post, effectively banning incentive-based InfoFi platforms. 

“Your X experience should start improving soon (once the bots realize they’re not getting paid anymore),” wrote X product lead Nikita Bier, adding that InfoFi projects had led to a “tremendous amount of AI slop and reply spam.”

The announcement had immediate ripple effects. The token of Kaito, one of the largest InfoFi platforms, dropped over 14%, and the company quickly announced it would shut down its Yaps and incentivized leaderboards, pivoting instead to a more curated platform: Kaito Studio.

Founder Yu Hu said the change reflects both X’s policy shift and a broader evolution in crypto marketing. “It’s agreed that a permissionless distribution model is no longer viable,” Hu wrote. Kaito Studio will prioritize quality creators, cross-platform reach, and analytics-driven marketing.

Meanwhile, Xeet, another InfoFi-adjacent platform, confirmed that all campaigns have stopped and it is assessing its next steps. While not directly identifying as InfoFi, Xeet acknowledged it was affected by the change and promised further communication.

The change is a welcome one for many, signaling a broader move away from algorithm-choking spam and toward higher-quality, user-first engagement in the crypto social space.

Podcast host Gwart had a funny thing to say about it: 

• 🏛️🔥 House Democrats criticized the SEC for retreating from crypto enforcement cases while raising national-security concerns about Tron founder Justin Sun’s alleged China ties, as momentum stalled behind a major bill meant to clarify U.S. crypto regulation.

• ⚛️📉 A top strategist at Jefferies dropped bitcoin entirely from his model portfolio, arguing that advances in quantum computing could eventually weaken the cryptography protecting the network, and reallocated the funds into physical gold and gold-mining stocks instead.

• 🏗️ Citrea, a layer 2 on Bitcoin, introduced ctUSD, a U.S. dollar stablecoin backed by Treasury bills and issued through MoonPay, aiming to simplify Bitcoin-based finance by offering a single native dollar token instead of fragmented bridged versions.

• 🤝 Ripple and institutional trading firm LMAX Group formed a long-term partnership backed by $150 million in financing, positioning Ripple’s dollar stablecoin as usable collateral across global trading markets that operate around the clock.

• ⏱️ Interactive Brokers now allows 24/7 account funding using the USDC stablecoin through crypto infrastructure firm Zerohash, enabling near-instant trading access and planning to add Ripple and PayPal stablecoins to reduce costs and bypass banking hours.

• 🏛️ Societe Generale worked with Swift to successfully test issuing and settling tokenized bonds using both cash and its euro-backed stablecoin, showing that traditional banking infrastructure and blockchains can operate together rather than compete.

• 🔗 State Street is expanding its blockchain strategy by creating tokenized versions of traditional cash and fund products like money-market funds and ETFs, positioning regulated, onchain bank assets as a safer alternative to stablecoins as institutions modernize financial plumbing.

• 📺 Bitmine, the ETH treasury company led by Tom Lee, committed $200 million to Beast Industries, the company behind YouTube star MrBeast, gaining exposure to a massive Gen Z audience while backing plans to blend consumer brands with crypto-based financial services.

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