Everybody seems focused on stablecoins, with the House bill on the subject passing through committee and the SEC releasing guidance on the types of stablecoin transactions that do not need to be registered with the agency. With people looking to park their money in cash during the current economic conditions, why not park it in digital cash that can easily get bond-level yields? There were also talks of which digital asset companies go public this year, and DeSci is having a moment.
Here’s everything that happened last week in Web3 legal:
House Marks Up Stablecoin Bill and Passes Through Committee
The House Financial Services Committee included H.R. 2392, the Stablecoin Transparency and Accountability for a Better Ledger Economy (STABLE) Act of 2025 in a recent markup session. Committee Chair French Hill stated he expected “our discussion today will be passionate” and his expectations were met over a marathon 10 hour debate, particularly regarding various proposed amendments to prohibit federal officials from “sponsoring, issuing, promoting or licensing” stablecoins, in response to President Trump-backed World Liberty Financial stating its intent to issue a stablecoin for its platform. The bill ended up passing through committee on a 32-17 bipartisan vote, but further changes can be expected before it reaches the House floor.
Tl;dr– Stablecoin legislation is getting done this year it looks like, but the two big remaining questions are whether authority will be split between state and federal authorities, and whether stablecoins should be permitted to be interest bearing with some arguing in favor of it and others arguing allowing interest bearing stablecoins would destroy modern banking. An Anti-Central Bank Digital Currency (“CBDC”) bill also advanced through the Committee, but that was more along party lines and less of an issue as any CBDC would likely need affirmative approval from Congress anyways.
SEC Releases Guidance on Stablecoins
While Congress seeks to address how to integrate stablecoins into traditional finance, the SEC also put out guidance regarding the applicability of existing securities laws to stablecoins. The SEC’s Division of Corporation Finance’s Statement on Stablecoins provides that the offer and sale of certain “Covered Stablecoins” do not involve the offer and sale of securities and issuers of the same “do not need to register [sales or redemptions of Covered Stablecoins] with the Commission under the Securities Act or fall within one of the Securities Act’s exemptions from registration.”
Tl;dr– The biggest takeaways here are the SEC’s focus on interest-bearing stablecoins turning a consumer product to an investment product under the Howey and Reves tests, and how the SEC focuses on centrally issued stablecoins but doesn’t limit its guidance to centrally issued stablecoins. The yield generation analysis is consistent with the bills moving through Congress which prohibit payment of interest to ensure stablecoins are not investment products. The guidance also doesn’t cover stablecoins pegged to something other than the U.S. dollar, but save that issue for another day.
OTHER STORIES
State Staking as a Service Lawsuits Dropped: Fresh off the SEC clarifying its view that pooled PoW mining operations are not generally securities offerings, South Carolina, Kentucky, and Vermont have all dropped their lawsuits against Coinbase alleging their PoS staking services were securities.
Bring Back the Fourth Amendment: I love to see this amicus brief from the DeFi Education Fund in a case regarding Americans’ Fourth Amendment Rights. I have been harping on this for years, but glad to see people focusing on the Fourth again.
Web3 AAA Gaming Token: Gunzilla Games’ GUN token, which fuels the Off the Grid game ecosystem, dropped. I have been playing with my friends, and even if the in-game assets are worth next to nothing, they are still rewards I get and can sell for doing something I would be doing anyways (gaming with my buddies) so I am a big fan, even amid some controversy.
Circle Going Public: USDC stablecoin issuer Circle has filed their S-1 to go public, aiming for a $5 billion valuation. Considering they had $1.68 billion in revenue and reserve income in 2024, that seems reasonable, even in less than optimal market conditions. Interesting we get details into Coinbase’s acquisition of a stake in Circle. Still not a fan of regulatory capture efforts by both firms, though. This is just the first of the crypto companies going public in the upcoming months/years, if tariffs don’t derail those plans.
Solana Policy Organization: First it was announced that the former CEO of the DeFi Education Fund would be leading newly formed Solana Policy Institute, and now the former Blockchain Association CEO is joining as well. Powerhouse.
DeSci Hot: Lots of decentralized science talk last week, with Bio Protocol making major upgrades and Sei Foundation looking to purchase 23andMe out of bankruptcy.
Bo Hines Interview: This interview with Bo Hines, who was appointed to lead crypto administrative efforts of the current Administration, was worth reading. Nothing groundbreaking, but good to know the perspective of the executive director of the Presidential Council of Advisers for Digital Assets.
Blackrock Tokenized Money Market Dividends: BlackRock’s tokenized money market fund BUIDL has paid out $25.4 million in investor returns within a year. All built on Ethereum, which as an ETH bag holder brings a smile to my face.
Framework on Digital Assets Going Bye-Bye?: Acting SEC Chair Uyeda has asked the staff to reassess certain guidance which includes the Framework for “Investment Contract” Analysis of Digital Assets. Good riddance.
CONCLUSION
If you have any questions or would like me to write about anything else, let me know on Twitter (X?) or Warpcast. As always, I am an attorney, I am not your attorney. For legal advice, you should always consult (and pay for) an attorney.
Outro/Disclaimer: Since late 2022, I’ve prepared weekly updates for attorneys at my firm to stay abreast of the latest Web3 legal developments. The biggest stories are included in Bi-Weekly posts on the firm’s BitBlog, where we provide tl;dr overviews and insights into the biggest stories from the past two weeks. I post the weekly updates on my personal blog every Tuesday, where I also provide links to more obscure legal developments and otherwise discuss industry trends and stories. Please note, the views and opinions I express, both on BitBlog and my personal blog, are solely my own. They do not reflect the official stance or endorsement of my firm.
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