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Reports have disclosed that centralized crypto lending climbed to roughly $25 billion in outstanding loans in the third quarter, a figure that signals renewed activity among centralized platforms. Activity has picked up this year, and some firms that survived the recent shake-out are growing their loan books again. CeFi Surges According to Galaxy Research , the broader crypto lending market totaled about $36.5 billion as of Q4 2024, down from a high of $64.4 billion in Q4 2021. That drop reflects the fallout from earlier platform failures and bankruptcies that cut into both supply and demand. The makeup of the market has shifted. Based on reports , the largest centralized lenders — including Tether, Galaxy and Ledn — now account for a large share of CeFi loans. Those three together held close to $10 billion of CeFi outstanding loans, equal to roughly 88.6% of that segment by the end of last year. Tether alone represented the biggest single slice. DeFi Borrowing Sees A Strong Comeback DeFi borrowing has recovered sharply from the lows of the 2022–2023 downturn. Open borrows on decentralized platforms climbed from about $1.8 billion in the trough to $19 billion by the end of 2024, an increase of 959% over the period. This shows many users moved back to on-chain solutions as centralized options contracted. Why Numbers Matter Now Market watchers say the new totals matter because they reveal where activity lives today: more on chain, and concentrated among fewer centralized players. Some lenders appear to be operating with higher collateral levels and clearer reporting than some of the failed firms of past years. That has calmed some investors. Still, the total lending market is far below its 2021 size. Risks Remain The concentration of CeFi loans in a handful of firms raises questions about single-point stress. If one large lender faces trouble, contagion could spread. Price swings in major cryptocurrencies also leave loans vulnerable to rapid liquidations. Regulators are watching the sector closely, and policy changes could reshape where and how loans are made. What To Watch Next Observers will be watching quarterly loan books, the pace of on-chain borrowing, and any signals of new capital flowing into lending desks. The market is rebuilding, but it is rebuilding in a changed form — smaller than the peak in 2021 and more split between centralized players and DeFi protocols. Featured image from Unsplash, chart from TradingView

Summary The UAE has enacted one of the world’s most comprehensive digital-asset frameworks, placing crypto, DeFi, and tokenization under central bank supervision and reinforcing the country’s position as a leading global crypto hub. Tether has rapidly expanded its gold reserves to 116 tonnes, placing it among the world’s top central bank-level holders. It also prepares a fully U.S.-regulated stablecoin (USAT) amid a highly competitive and evolving U.S. stablecoin landscape. Texas's $5 million allocation to a bitcoin ETF marks an early move toward the first state-level bitcoin reserve in the U.S., occurring alongside a broader trend of global public entities gradually increasing BTC exposure even as short-term market selling persists. UAE Enacts Sweeping Central Bank Law to Regulate Crypto and DeFi The United Arab Emirates has introduced one of the world’s most comprehensive national frameworks for digital assets, bringing crypto, DeFi and blockchain services fully under the supervision of the Central Bank of the UAE (CBUAE). The newly enacted Federal Decree Law No. 6 of 2025 replaces the country’s previous banking framework and requires all crypto and blockchain businesses operating in or from the UAE to obtain a CBUAE license, regardless of the technology used. The law integrates digital assets, decentralized finance, stablecoins, tokenized real-world assets, exchanges, wallets, and infrastructure into traditional financial regulation while aiming to position the UAE as a global hub for financial innovation. It introduces 60-day licensing decisions, risk-based capital rules, enhanced Shari’ah governance, and a one-year grace period (until September 2026) for existing firms to become compliant. New licensable categories include virtual asset payments, open finance, and digital wallets. Key Take The UAE has introduced one of the first fully unified national frameworks that explicitly brings DeFi under central-bank oversight, going one step further than current regimes in other jurisdictions like Europe or the U.S., where DeFi is still not covered in regulation or only indirectly addressed. The UAE has established itself as a leading global crypto hub. Dubai and Abu Dhabi, in particular, are hotspots, with free zones like the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market ((ADGM)) fostering innovation through dedicated regulators such as the Virtual Assets Regulatory Authority (VARA). Compared to other crypto hubs such as Hong Kong and Singapore, UAE emphasizes innovation and competitiveness through its free-zone frameworks, creating a more flexible environment for Web3, tokenization, and DeFi experimentation. Tether Becomes a Major Global Gold Buyer Tether ( USDT-USD ) has significantly accelerated its gold accumulation, emerging as one of the largest purchasers of the metal in recent months. According to a new analysis from investment bank Jefferies, the company acquired 26 tonnes of gold in Q3 2025, lifting its total holdings to around 116 tonnes, roughly $9 billion, a level that only central bank gold reserves could compare, and would place Tether among the top 30 gold-holding central banks worldwide. While part of this stash backs Tether’s tokenized gold product XAUT ( XAUT-USD ), the total market cap of XAUT is only $1.6 billion, which translates into around 12 tons of gold. The majority of the gold sits within the firm’s broader reserve portfolio, where precious metals now make up roughly 7% of assets. Tether has been expressing a growing preference for “safe” real-world assets, allocating the company's profits into Bitcoin ( BTC-USD ), gold, and land. Beyond bullion, Tether has also been expanding into commodity-linked investments, including a reported $100 million commitment to mining royalties through Elemental Altus. Key Take USDT allocates a growing share of its reserve assets to hard assets like gold and Bitcoin, which now make up over 12% of total reserves. However, this approach contrasts sharply with the framework outlined in the U.S. Stablecoin Act, which would require stablecoins operating in the U.S. to be backed exclusively by U.S. Treasuries or similarly cash-equivalent instruments. Tether is developing a new U.S.-regulated stablecoin, USAT, led by Bo Hines, the former White House digital-assets advisor and current CEO of Tether U.S. The token will be issued through Anchorage Digital, a U.S.-regulated crypto bank, with its reserves custodied by Cantor Fitzgerald. The U.S. stablecoin market is poised to become intensely competitive, with established regulated players like Circle, payment leaders such as PayPal ( PYPL ) with PYUSD, and a growing number of licensed financial institutions all exploring or preparing to issue compliant stablecoins. Texas Takes Initial Step Toward State-Level Bitcoin Reserve Texas has taken a first step toward creating a state-managed bitcoin reserve by allocating $5 million to BlackRock’s [[IBIT]] bitcoin ETF, with the funding coming from state-appropriated money. While this is not yet a direct bitcoin holding, Texas is finalizing the structure, custody arrangements, and procurement process for its planned Texas Strategic Bitcoin Reserve. Several U.S. states have previously gained indirect crypto exposure through pension-fund investments, but none have yet established their own government-held bitcoin reserves. Texas may become the first to do so, with New Hampshire and Arizona also working on the same efforts at different stages of development. At the federal level, the current U.S. government’s bitcoin reserve comes entirely from seized assets, acquired through law enforcement actions. Following the Strategic Bitcoin Reserve Executive Order signed by President Trump earlier this year, seized bitcoins will not be sold and will be treated as long-term store-of-value assets, and in the meantime, federal officials are evaluating what a budget-neutral accumulation framework could look like. Key Take With Bitcoin dipping below $90,000, public entities around the world appear to be buying pullbacks. El Salvador recently added roughly $100 million in BTC to its holdings, while Texas deployed $5 million into a bitcoin ETF. Recent activity shows a growing number of global public entities increasing their Bitcoin exposure. The Czech National Bank approved and executed a $1 million digital-asset pilot purchase in late October 2025, including BTC and a USD stablecoin. Luxembourg’s sovereign wealth fund confirmed its 1% Bitcoin allocation in 2025 as part of a completed strategic rebalancing. In the Middle East, the Abu Dhabi Investment Council tripled its holdings in BlackRock’s IBIT ETF during Q3 2025, accumulating nearly 8 million shares ($518 million) ahead of the recent market volatility. As noted last week, current market selling is largely driven by retail ETF outflows, long-term holders taking profit, and four-year cycle believers reducing exposure. However, the backdrop also shows a steady base of long-term bidders from both public companies and government-linked entities. Public companies treating Bitcoin as a treasury asset can accumulate more decisively and at scale, while state institutions and sovereign bodies tend to move more gradually due to public-funding constraints, procedural requirements, and political considerations. Weekly Market Chart: Deleveraging Hits Ethena’s USDe Ethena’s USDe ( ENA-USD ), the synthetic stablecoin that earns yield from perpetual funding rates, has seen its total value locked (TVL) fall nearly 50%, from $14.8 billion in October to $7.6 billion. USDe’s yield, now around 5.1% APY, has declined from earlier double-digit levels as perpetual funding rates compressed alongside waning leverage demand. The TVL contraction appears primarily tied to the deleveraging of looping strategies across DeFi protocols such as Aave ( AAVE-USD ), where traders had used staked USDe (sUSDe) as collateral to borrow USDC, re-enter positions, and amplify exposure up to 10x. As yields fell below USDC borrowing rates (5.4%), many of these trades turned unprofitable, triggering widespread unwinds. Source: The Block Disclaimer: The information provided herein does not constitute investment advice, financial advice, trading advice, or any other sort of advice, and should not be treated as such. All content set out below is for informational purposes only. Original Post Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.

Sony Bank plans to launch a stablecoin pegged to the US dollar as early as 2026. Sony Bank, which is a subsidiary of Sony Financial Group Inc. and part of the broader Sony Group, is reportedly planning to integrate its stablecoin within its global entertainment ecosystem, including services such as gaming, streaming, and anime, according to Nikkei. Sony users to pay using stablecoins Up until now, US customers who used Sony’s entertainment services were able to pay for subscriptions and content primarily via credit cards or traditional payment methods. But with the launch of its stablecoin, the company expects to offer a faster and lower-cost alternative for users to make purchases across its platforms, the report said . For Sony Group, the US remains a major market that accounted for over 30% of its total external revenue for the fiscal year ending March 2025, and with the introduction of a supportive regulatory environment championed by pro-crypto President Donald Trump, Sony hopes to capitalize on the momentum. The Trump administration signed the GENIUS Act into law in July, which paved the way for regulated issuance of payment stablecoins under a clear federal framework. Since its passage, the market for stablecoins in the country has continued to flourish, with a rapidly expanding list of institutions like Sony Bank now entering the space. Sony Group began exploring stablecoins as early as April 2024, when it launched a proof-of-concept for a yen-pegged token in collaboration with Polygon Labs and blockchain firm SettleMint. However, its plans for a US dollar-pegged coin started becoming clear after it partnered with Bastion, a US-based infrastructure provider for compliant stablecoin issuance. Sony Innovation Fund was a participant in Bastion’s $14.6 million funding round in September. Bastion offers a “stablecoin-as-a-service” platform that allows enterprises like Sony Bank to issue and manage their own branded tokens while remaining fully compliant with US laws, including the GENIUS Act. Sony Bank also applied for a US banking charter in October through a subsidiary named Connectia Trust and plans to establish a US-based branch to oversee issuance, compliance, and operational functions related to the stablecoin. Stablecoin market expected to grow Sony is making its move at a time when the stablecoin market is expected to see explosive growth, with Citi forecasting it could reach up to $1.9 trillion by 2030 as a base case scenario. Much of the current global stablecoin market remains concentrated in dollar-backed tokens like Tether’s USDT and Circle’s USDC, but that hasn’t stopped other players from entering with their own offerings. Over the past few months alone, a number of major institutions have disclosed plans for stablecoin initiatives aimed at improving cross-border payments and digital settlement systems. As previously reported by Invezz, Klarna, a Sweden-based fintech, launched KlarnaUSD to enhance global payment efficiency for its 114 million customers. Similarly, US Bank recently announced it was partnering with the Stellar Development Foundation and PwC to test the issuance of custom programmable stablecoins designed specifically for banking use. The post Sony Bank to launch US dollar pegged stablecoin to power payments in 2026 appeared first on Invezz

The recent crypto crash in November 2025 wiped out $524 million in liquidations, driven by concerns over Tether's stability and potential Bitcoin sales from major holders like MicroStrategy. Bitcoin dropped 5% in 24 hours to around $86,800, pulling altcoins like Ethereum and XRP down as well. Bitcoin fell 5% amid fears of increased supply from [...]

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Tether CEO Paolo Ardoino criticized S&P Global's downgrade of USDT's peg stability rating, calling it based on outdated models and incomplete data. He highlighted Tether's $7 billion excess equity, $184.5 billion reserves, and $23 billion retained earnings to affirm the stablecoin's robust backing and financial strength beyond critics' assumptions. S&P Global downgraded USDT's peg-stability rating [...]

Tether CEO Paolo Ardoino has strongly criticized S&P Global an d cr itics, dismissing the agency’s assessment as based on “outdated legacy models. He argued that the downgrade of the stablecoin’s rating was based on incomplete information and did not accurately reflect the company’s real financial strength. Ardoino insisted that S&P had failed to fully take into account Tether’s assets, the volume of its profits, and the value of the wider group’s equity. These points further strengthen Tether’s case, he said, and demonstrate that USDt is backed by significantly more assets than critics would have assumed. For numerous exchanges and users, USDt serves as a reliable workhorse for daily transactions. As a consequence, any perception of weakness can raise alarm bells, even if the fundamentals supporting it remain strong. S&P downgrades USDT dollar-peg rating On November 26, S&P downgraded USDT’s so-called “peg‑stability” rating from 4 (“constrained”) to 5 (“weak”) — the lowest level under its 1–5 scale introduced in 2023. The agency cited growing reserves in what it terms “high‑risk” assets: allocations to cryptocurrencies such as Bitcoin, precious metals, corporate bonds, secured loans, and other assets that introduce credit, market, interest‑rate, or foreign‑exchange risks. The agency downgraded the dollar peg stability for USDt to its weakest level, its second downgrade since March. This decision took many in the industry by surprise, as USDt has proven itself capable of maintaining its peg during significant market swings over the years. The downgrade quickly alarmed analysts, who said the rating could undermine confidence in a token that underpins billions of dollars’ worth of daily trading activity throughout the cryptocurrency market. Ardoino disputed the report , saying it did not accurately represent Tether’s financial position. He said that Tether had, at the end of Q3 2025, approximately $7 billion in excess equity, in addition to the approximately $184.5 billion in stablecoin reserves, and an additional $23 billion in retained earnings as part of the Tether Group’s equity. There was also roughly another $7 billion worth of reserves kept as a second buffer for USDt holders, but these were reserved in other forms, and they had “a different risk level”, Ardoino said. Ardoino also claimed that S&P had swept Tether’s powerful revenue engine under the rug. From U.S. Treasury yields alone, Tether is taking in roughly $500 million a month, courtesy of its substantial holdings of government debt. The company’s income has grown as it has expanded and invested more of its reserves in short-term U.S. securities. He contended that the rating company did not take into consideration the structure of the broader Tether Group. This conglomerate encompasses several revenue-generating divisions and substantial amounts of equity unrelated to stablecoin reserves. Experts scrutinize Tether’s asset allocation and potential pitfalls The downgrade had reignited old controversies about Tether’s reserves. Some analysts have wondered if Tether is too heavily reliant on non-traditional assets. BitMEX creator Arthur Hayes hinted that Tether may be acquiring more gold and Bitcoin. He said these assets could also be employed to offset dwindling income on U.S. Treasuries in the context of falling interest rates. If the prices of gold and Bitcoin were to decline precipitously, by, say, 30% or more, Tether’s equity could be wiped out, Hayes warned. He said that, in theory, such a situation could leave USDt vulnerable to insolvency. But other experts dismissed the view. Joseph Ayoub, who was previously a top digital asset analyst at Citi, said he had analyzed Tether extensively and that the company is much stronger than many of its critics claim. Ayoub stated that Tether’s reserves exceed its debt, much of which is unaccounted for in public summaries, and that the company has one of the most lucrative business models in finance. The firm, he said, generates billions in interest income with a staff of barely 150 people. Tether is better collateralized than the majority of traditional banks, he also noted. The smartest crypto minds already read our newsletter. Want in? Join them .