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Good morning and welcome to the Hodl Report
The banks are nervous, and for once, it’s not just because Jamie Dimon said something spicy on CNBC. Between stablecoins threatening their turf and Bitcoin quietly infiltrating your retirement fund like it’s wearing a suit and tie, TradFi is starting to sweat. Today we’re diving into why regulators are eyeing USDC like it’s a ticking time bomb—and how BTC is becoming the sleeper agent of American index funds. Let’s unpack the quiet revolution happening on Wall Street’s spreadsheet.
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Editors Corner
Why Banks Are Freaking Out About Stablecoins
The GENIUS Act made stablecoins legal, regulated, and boring in all the right ways. Circle, Paxos, and other issuers are thrilled — clarity is exactly what they wanted. But the banking industry is not happy. Here’s why:
Deposits are their lifeblood.
Banks don’t actually make money holding your money. They make money lending your deposits out. If people start moving trillions into stablecoins, banks suddenly have less to work with. That’s a problem, because their whole business model is basically “hold your money, pay you nothing, and profit off the spread.”
Yields make them look bad.
If a stablecoin can offer 3–5% backed by boring old Treasuries, why would you keep cash in a checking account earning 0.2%? For decades, banks got away with this because there wasn’t an easy alternative. Now there is.
They don’t want competition.
Banks would love to keep the money game rigged in their favor. Their lobbyists are already working overtime to stop stablecoin issuers from paying interest. They’ll say it’s about “consumer protection.” Translation: “please don’t let crypto show everyone we’re cheap.”
So What Happens Now?
Regulatory tug-of-war. Banks will push for rules that make stablecoins less useful. Don’t be shocked if “interest-bearing” stablecoins get clipped.
DeFi workarounds. Even if issuers can’t pay yield directly, you can bet DeFi platforms will wrap, vault, or structure stablecoins to squeeze yield out anyway.
Bank-style stablecoins. If banks get their way, only mega-players like JPM, Circle, or PayPal will issue “official” stablecoins — everyone else gets pushed out.
Or… stablecoins win. If regulators hold the line, we could see deposits bleeding out of banks into tokenized dollars and money markets. That’s when things get spicy.
At the end of the day, banks aren’t scared because stablecoins are shady. They’re scared because stablecoins are better. Faster, cheaper, more transparent, and — here’s the kicker — actually paying people.
And when banks finally have to compete on yield instead of monopoly, things are going to get real interesting adn ultimately better for consumers.
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Today’s Report
How Bitcoin Is Sneaking Into Every Index Fund in America
Our Report
Strategy just hit every mark for S&P 500 inclusion, and the only thing standing between Bitcoin's corporate proxy and a flood of institutional money is a green light from the index committee. That decision could land as early as Friday, with inclusion set for September 19. In case it wasn’t obvious: this is monumentally bullish. Not just for Strategy (née MicroStrategy), but for Bitcoin’s creeping colonization of traditional finance. Passive flows are about to meet maximalist conviction—and someone’s going to have to buy the top.
Key Points
Strategy posted $14B in operating income and $10B in net income for Q2, driven by unrealized Bitcoin gains under new accounting rules.
The company holds ~600K BTC, by far the largest corporate stack on Earth.
It now qualifies for every S&P 500 inclusion metric: market cap, liquidity, float, profitability, and U.S. listing.
A potential decision is expected on September 5; index changes take effect September 19.
If added, ~$3 trillion in index-tracking assets would be forced to buy Strategy shares.
Relevance
If Strategy gets in, Bitcoin gets institutionalized—again. This time, not through ETFs or futures, but through passive equity exposure. S&P 500 inclusion isn’t a feel-good milestone; it’s a rules-based reallocation trigger. That means pensions, mutual funds, and robo-advisors will auto-buy a Bitcoin proxy whether they want to or not. The beauty here is in the mechanics. This isn’t bullish sentiment—it’s bullish inevitability. Bitcoin’s volatility just became a feature in the most tracked index on Earth. And if the committee pulls the trigger, don’t expect the market to wait until September 19 to react.
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Today’s Top News
HEALDINES
Trump-Backed American Bitcoin Surges After Nasdaq Debut — American Bitcoin (ticker: ABTC), backed by Donald Trump Jr. and Eric Trump and merged with Gryphon Digital Mining, soared ~110% before settling with a 17% gain. The listing and follow-on stock offering could influence public-sector sentiment toward crypto regulation and market dynamics.
Galaxy Digital Tokenizes Its Common Stock on Solana — Galaxy Digital made a pioneering move by digitizing its U.S.-listed shares for trade directly on Solana, providing legally equivalent equity access on-chain and potentially setting the stage for mainstream equity tokenization.
Solana Outperforms Bitcoin; Could Follow Ethereum’s Rally — Solana (SOL) has surged ~33% since early August, outperforming BTC and showing signs of following Ethereum’s recent explosive rally—a key signal for altcoin strength heading into Q4.
Ethereum Foundation to Sell 10,000 ETH for R&D and Grants — The Ethereum Foundation plans to liquidate 10,000 ETH via centralized exchanges over several weeks to fund research, grants, and donations—raising concerns and strategic talk around protocol funding and centralization dynamics.
Market Trendline
PRICE ACTIONS
Bitcoin finally peeled off its two‑week downtrend, clawing above the $111K mark intraday before settling mid‑range—not exactly ripping higher, but enough to suggest buyers are tentatively poking around again. Ethereum outpaced BTC, rallying nearly 3.6% today as ETF momentum and large‑scale withdrawals hint at supply tightening. The broader market is quietly healthier—altcoins are catching bids in a cautious recovery.
Notable Movers
Ethereum (ETH): Up ~3.6%, outperforming BTC. ETFs and supply squeeze from withdrawals appear to be lighting a spark under bulls.
Bitcoin (BTC): Bumped back above $111K, marking a technical break from the recent drip. Stablecoin liquidity is credited with buoying sentiment.
XRP: Whales quietly scooped up $1.1B in tokens over just three days—calm accumulation that could surprise if demand picks up.
Pi Coin: Still crawling near its all-time low; it’s a weak signal in an otherwise firmer tone across major assets.
Macro View
ETF flows into Ethereum remain the clearest short‑term narrative, tilting demand dynamics. The uptick in stablecoin liquidity (leveraged into the BTC market) puts a floor under selling. Meanwhile, whale accumulation in XRP reveals selective faith in specific altplays—even as broad attention stays modest.
Bottom Line
Ethereum’s move today confirms it's capturing the spotlight, while Bitcoin stabilizes—teetering but not falling. The market may be shifting from fear headline to selective confidence, with liquid altcoins drawing cold‑hearted capital. Expect chop unless a fresh catalyst arrives—this feels like prep, not party.
Today’s Top Meme
MEME GOD
YOU, BITCOIN and YOUR FRIENDS. 😅
#BTC #Bitcoin #Crypto #Meme
— #THE BLOCKOPEDIA (#@theblockopedia_)
2:30 PM • Aug 28, 2025
Today’s Top Tweet
TWITTER NEVER SLEEPS
$ETH has only been here 3 times in history.
In 2021, these levels marked exhaustion.
This time, Ethereum has record demand, with over 1.5M ETH ( $8B ) purchased in August alone.
The difference is supply mechanics:
ETH is now being bought faster than it’s being issued. That’s
— #Milk Road (#@MilkRoadDaily)
3:30 PM • Aug 30, 2025
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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.