A research report by Bernstein suggested the recent regulatory action taken against the Binance USD (CRYPTO: BUSD) stablecoin and its issuer Paxos is specific to BUSD and cannot be applied to other stablecoins like USD Coin (CRYPTO: USDC).
What Happened: Some in the industry were concerned that stablecoins and custody rules were under attack, but USDC’s issuer, Circle, stated it had not received any notice from the U.S. Securities and Exchange Commission.
The proposed custody rule change is favorable for bank custodians, which is good news for crypto custodians such as Anchorage Digital, which have bank charters.
Despite short covering, the crypto market has seen significant gains this week, with a total market cap of almost $1.2 trillion.
The report also noted bearish crypto investors have ignored healthy user trends on-chain and that layer 2 ecosystems have been vibrant, with cheap transaction costs driving adoption and new app deployments.
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Asia Market Status: According to a Coindesk report, Bernstein noted regulatory murmurs from Hong Kong are net positive, and there was an expected easing of norms.
The research further suggested that while the U.S. regulatory environment for cryptocurrencies may seem challenging, the situation is more positive in Hong Kong. As a result, the market is likely to be led by Asia until the regulatory landscape settles down in the U.S.
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