The move enables seamless value transfers across decentralized exchanges by using XRP’s native auto-bridging feature. Circle’s latest development happened amid growing regulatory focus in the US on establishing a stablecoin framework, with officials like Treasury Secretary Scott Bessent promoting dollar-pegged stablecoins as instruments to uphold the dollar’s global dominance. Meanwhile, stablecoin issuer Tether continues to diversify beyond fiat-backed tokens with its recent $89.4 million acquisition of a 32% stake in Elemental Altus Royalties. It is expected that this acquisition will help strengthen its position in gold-backed assets and enhance the appeal of its XAUt token. At the same time, US Bancorp is revisiting its crypto strategy under the Trump administration by reviving its custody services and even exploring stablecoin initiatives of its own. Overall, this convergence of corporate, banking, and government interest could be a pivotal moment. XRP Ledger Welcomes USDC Circle’s USDC stablecoin officially launched on the XRP Ledger (XRPL). This is a big step in integrating traditional financial tools with decentralized blockchain infrastructure. The addition of the overcollateralized, dollar-pegged USDC token to the XRPL allows users to leverage XRP as a bridge asset, which will enable seamless transfers between decentralized exchanges (DEXs) using the network’s auto-bridging feature. RippleX Senior Vice President Markus Infanger said that stablecoins are becoming crucial on-ramps into the crypto economy, especially for applications centered on utility rather than speculation. The launch coincides with a regulatory push in the United States to establish a comprehensive framework for stablecoins as the market capitalization of the sector climbs past $237 billion. Policymakers increasingly see stablecoins as strategic tools to maintain the global influence of the US dollar. Issuers of overcollateralized stablecoins typically invest in short-term US Treasury bills, using the yield from these government securities as profit while also strengthening the demand for US debt. Overview of the stablecoin market (Source: RWA.xyz ) This mechanism took on added importance as concerns about the US government’s creditworthiness and ballooning debt levels led some foreign governments to reduce their holdings of US bonds. Such sell-offs raise yields and drive up borrowing costs for the US government, compounding the already high $36 trillion national debt . To counter this trend, Treasury Secretary Scott Bessent pledged at the White House Crypto Summit in March to support stablecoin development as a way to enhance the salability and global demand for the US dollar. Nevertheless, critics like Bitcoin advocate Max Keiser argue that relying on stablecoins to prop up the dollar is a short-term solution that will not prevent the long-term decline of the fiat system. Keiser believes that stablecoins backed by gold may ultimately outperform dollar-pegged tokens due to gold’s intrinsic resistance to inflation and its high stock-to-flow ratio, which ensures a more stable store of value. Tether Acquires Major Stake in Elemental Altus Royalties Circle is not the only stablecoin issuer making moves. Tether acquired a 32% stake in Canada’s Elemental Altus Royalties as part of a strategic move to diversify its assets beyond stablecoins. The stablecoin issuer announced the $89.4 million deal on Thursday, which involved purchasing over 78 million common shares from La Mancha Investments at CA$1.55 ($1.14) per share. This acquisition is part of Tether’s strategy to integrate long-term stable assets like gold and Bitcoin into its digital financial ecosystem to reduce risk and build resilience in its infrastructure. Elemental operates on a royalty and streaming model that provides exposure to global gold production without the operational risks of mining. Tether sees this as a low-risk way to back its digital assets with real-world value, enhancing transparency and financial stability. CEO Paolo Ardoino explained that investments in gold and Bitcoin are essential for creating a more durable and transparent financial system, and called the move a step toward building infrastructure for the next century. The acquisition also boosts Tether’s gold-backed stablecoin, Tether Gold (XAUt) , which has grown to become the largest gold-backed cryptocurrency by market cap. XAUt reached a market cap of $854 million in April, coinciding with gold’s 30% surge year-to-date that saw spot prices peak at $3,500 before dipping slightly to around $3,433. Tether hinted that its stake in Elemental could support even more expansion into commodity-backed digital assets. This purchase was made after a series of high-profile investments by Tether after it reported a record $13 billion profit in 2024 and formally expanded its focus beyond stablecoins in April of 2024. In May, the company acquired $458.7 million worth of Bitcoin for Twenty One Capital, a firm set to merge with Cantor Equity Partners, and later moved another $3.9 billion in BTC to the same firm. These transactions made Tether the third-largest corporate Bitcoin holder behind Strategy and MARA. Earlier this year, Tether also took a 30% stake in Italian media company Be Water, and invested in the Juventus football club. US Bancorp Eyes Stablecoins Meanwhile, US Bancorp’s institutional crypto custody business is experiencing a resurgence under the crypto-supportive Trump administration, according to CEO Gunjan Kedia. At the Morgan Stanley US Financials Conference , Kedia explained that the bank’s crypto custody product, which was originally launched in 2021 , failed to gain traction during the Biden administration due to regulatory uncertainty. However, she said that institutional interest is returning now that the regulatory climate has shifted, and the bank is once again able to offer the service to clients. Gunjan Kedia The earlier stagnation of US Bancorp’s crypto offering was largely attributed to the SEC’s aggressive stance during the Biden era, which saw a number of enforcement actions against digital asset companies and offerings. These regulatory hurdles made large institutional investors very cautious about entering the space. With the Trump administration reversing many of these enforcement efforts and promising to stop more regulatory crackdowns, banks like US Bancorp are revisiting their role in the digital asset ecosystem. In addition to renewed interest in crypto custody, Kedia revealed that US Bancorp is closely monitoring developments around stablecoins. The bank is considering what role it might play in the growing stablecoin economy , including the possibility of launching its own dollar-pegged token. She explained that this would likely involve partnerships and pilot programs that are already underway. Moreover, the bank could take on a broader role in the ecosystem by providing infrastructure, like custody for the backing assets and escrow services, although she acknowledged that many details still need to be resolved. Kedia also pointed out that despite the headline growth in stablecoin transactions, a lot of the current volume is still limited to crypto-to-crypto activity rather than real-world payments. She believes that the path forward for traditional financial institutions in the stablecoin space will become clearer as legislation like the GENIUS Act progresses.
