On the eve of Thanksgiving, Uweb, Asia's largest digital asset education institution, organized a study tour to New York, which I was fortunate enough to be invited to participate in, and I gained a great deal. New York is undoubtedly the center of global capitalism and global finance, and is now becoming the center of the crypto economy, so even though the short week-long itinerary was packed, I still felt it wasn't enough. This trip to New York coincided with several key moments. First, the longest government shutdown in US history had just ended; second, the AI industry's market capitalization was facing widespread concerns about a bubble and experienced a temporary correction; and third, the crypto asset market experienced a flash crash of over 10% overnight. Therefore, at Wall Street, the intersection of money and information, we were exposed to a large amount of information at a high density. There was a lot I could write about, but with the further tightening of policies on digital assets in China, and the main readers of this public account being in China, I will omit some sensational details and only summarize the key points.
Although I summarized the viewpoints, I should have personally mentioned and thanked the experts and friends from various parties. However, given the sensitivity of current online public opinion in Chinese, some names have had to be omitted to avoid causing unnecessary trouble for others. Please understand. I summarized nine viewpoints in total, published in two parts. 1. The US Economy is in a Dilemma Between Stimulating Growth and Curbing Inflation The US's current attitude towards the crypto economy is to first "Americanize" it; therefore, discussing the crypto economy is inseparable from understanding the overall US economy. During this study tour, two economists were invited to conduct a comprehensive analysis of the US economic situation. Their views were largely consistent, both believing that the US economy currently exhibits a structural contrast. From the overall data, economic growth is strong, inflation is stable, and the situation is quite good. However, upon closer inspection, growth is almost entirely driven by AI investment, and structural inflation is severe. Excluding AI-related sectors, the economy is near zero growth. Trump's actively promoted "manufacturing resurgence," at best, is still "laying the foundation," with no tangible results yet. While overall CPI data looks good, service sector inflation is severe, particularly with property insurance and housing prices expected to surge in 2025. Long-standing issues like tipping have not only failed to improve but are showing signs of worsening. Coupled with the exceptionally difficult job market for this year's graduates, the economy lacks the vibrant feel of the early part of Trump's first term. Economists describe the current US economy as experiencing "K-shaped growth"—AI-related sectors are booming, while the plight of the lower and middle classes continues to decline. Americans are not like the Chinese. The Chinese don't care about their own well-being; they can get excited over impressive macroeconomic data and passionately concern themselves with abstract topics like whether China can "defeat the West" in technological competition—they are truly selfless. However, what we saw and heard during our visit to New York revealed that Americans' level of concern is far lower. Even Wall Street elites are more concerned with how well they are doing than with winning or losing. So, good-looking numbers are useless; Americans are actually quite dissatisfied. If this situation continues, the Republicans will lose at least one house in next year's midterm elections. Economists also see this situation, but they disagree on how to handle it. Some believe that interest rates should absolutely not be cut in December, while others believe that interest rate cuts should be prioritized to stimulate the economy. I asserted on one occasion that Powell would not compromise and therefore there would be no interest rate cut in the near future, but another senior financial expert believed that the Fed would not withstand the pressure and would definitely cut rates. Unexpectedly, our differing opinions were reconciled in an unforeseen way: news broke that Powell would retire four months early in January, and the new chairman appointed by Trump would inevitably push for a rapid interest rate cut. This way, the hard-headed Chairman Powell preserved his reputation, and the domineering President Trump achieved his goal—a win-win situation. Therefore, although the cryptocurrency market crashed during my time in New York, leading to widespread cries of a bear market, I remain bullish on the future. However, given the current situation in the US, once interest rates are cut, inflation will likely rise immediately. How long can this liquidity boom last? 2. AI Single Engine Driving US Growth The US GDP grew by 4.1% in the third quarter, with AI-related growth accounting for 4.0%. US economic growth is almost entirely driven by AI. Moreover, in VC investment, there's a trend of "no investment in anything but AI." It's clear to anyone with a discerning eye that this situation is unsustainable and should be considered an extreme case in this AI boom, but it also reflects the role AI plays in the current US economic growth. Before our academic visit to New York, the AI stock market experienced a downturn, with AI benchmark stock Nvidia falling more than 10% from its peak, and Oracle even falling more than 30%. Therefore, the idea of an AI investment bubble was a hot topic on Wall Street. When I visited Silicon Valley in August, most Silicon Valley VCs strongly denied the AI bubble theory. However, Wall Street in November had a different view, which I think reflects the different attitudes of innovative thinking and financial thinking towards the issue. Most on Wall Street believe that current AI infrastructure investment in the United States is financially unhealthy, meaning that the money invested in AI data centers is not worthwhile. Some have pointed out that the impressive financial statements of companies like Nvidia are ultimately embellished by orders from companies like OpenAI, which have promised $1.4 trillion in orders but have only generated less than $20 billion in revenue. Wall Street, when doing the math, simply cannot make this work. But does this mean there's an AI bubble? Even on Wall Street, opinions differ. Some believe there is a financial bubble because the entire AI industry's revenue is weak, struggling even to cover investment interest. Others are optimistic, believing that AI applications are rapidly expanding and will soon strongly boost US economic growth. Some even argue that AI applications are driving rapid innovation in areas like nuclear power miniaturization, hydrogen power generation, aerospace technology, robotics, and 6G, potentially propelling the US economy to grow at 10% by the 2030s. If this is the case, investing in the AI industry now, even with short-term financial losses, is entirely worthwhile. After the initial investment period, the market will automatically adjust prices, allowing investors to profit in the long run. This view is not unfamiliar to the Chinese. China's high-speed rail itself has been operating at a huge loss financially for a long time, but many believe that high-speed rail has driven the overall growth of China's economy and industrial level, making some short-term losses worthwhile. This sentiment also exists within the United States. During our time in New York, Trump signed an executive order launching the Genesis Mission, emulating the Manhattan Project of yesteryear, using government resources to promote AI development—a manifestation of this approach. 3. Although debate persists, the trend of the US embracing the crypto economy is irreversible. One important purpose of this trip to New York was to observe Wall Street's attitude towards the crypto economy. Over the past decade, Wall Street has generally been anti-crypto. After almost a year of relentless promotion by the Trump administration, has their attitude changed? From my observation, a shift is underway, roughly 10-20% complete. First, it would be absolutely misleading to say that Wall Street is now fully and enthusiastically embracing the crypto economy. Wall Street remains Wall Street. After centuries of development, it has created the world's most advanced, complete, and prosperous financial ecosystem, enjoying the wealth and power it brings. Satisfied with the status quo, Wall Street is unlikely to react with the same excitement as tech geeks to a technology that claims to disrupt or at least transform its own centered financial infrastructure. Instead, it will inevitably adopt a guarded and skeptical attitude. Within Wall Street, JPMorgan Chase is a major representative of the anti-crypto movement. Unconfirmed market rumors suggest that the crypto market crash on November 20th was related to JPMorgan Chase's attack on MicroStrategy. Regardless of the veracity of this claim, it is undeniable that a considerable and stubborn force on Wall Street still rejects and opposes crypto. However, a shift is underway. Wall Street traders and fund managers have long been highly attentive to and involved in the crypto market, but the key lies in the attitude of institutions. Wall Street institutions are not monolithic; from banks to asset management, from investment banks to securities firms, from exchanges to hedge funds, different ecological niches determine their different perspectives on crypto. From the perspective of at least some institutions, blockchain technology can help them solve two problems: First, it allows them to conduct financial business globally through blockchain. Especially in the context of deglobalization, blockchain can break down regulatory barriers in countries with weak governance, allowing Wall Street to continuously expand its business. In this sense, the higher the financial barriers in other countries and the more blocked traditional channels are, the greater the attraction of on-chain finance to Wall Street. Second, it attracts young people. One problem that has plagued Wall Street in recent years is that young people who grew up in the internet age are increasingly impatient with Wall Street's outdated and cumbersome service models, preferring to trade cryptocurrencies rather than work on Wall Street. However, if financial services can be built on blockchain, it can attract young people back. Therefore, more and more institutions on Wall Street are starting to consider blockchain, with RWA and DeFi being their current focus. A senior investment banking expert on Wall Street told me that the "Jews" on Wall Street are now "getting restless," a significant signal that cannot be ignored. However, looking solely at Wall Street, I don't believe the situation has reached an irreversible point. If we imagine the next US administration cracking down on the crypto economy like Biden did, would Wall Street revert to its starting point? At least for now, Wall Street hasn't invested much in crypto, so a reversal is possible. However, if we look at the US as a whole, we can conclude that the US's embrace of the crypto economy is irreversible. During this visit, we met the head of a prominent Democratic Party family foundation. She told us that Democratic leaders have recognized that crypto is a choice for young people. During Biden's administration, in order to appease the hardliners on Wall Street, the Democratic Party ruthlessly suppressed the crypto economy, offending young people. This was a significant reason for the Democratic Party's defeat in the 2024 election. In today's American politics, the political leanings of middle-aged and older people are already established; winning the votes of young people is crucial for both parties. Therefore, even if the Democrats govern in the next election, they will not be reactionary on crypto policy. She also revealed that the family's fund has already allocated a large portion to crypto assets. Meanwhile, some economists and central bankers we spoke with also expressed their support for the crypto economy from another perspective. One economist told us that, according to their research, since the Stablecoin Act was passed in July 2025, the global usage of the US dollar has increased, indicating that stablecoins have indeed strengthened the dollar's position as expected. This is a strong incentive for congressional legislators, and Congress is actively pushing for the passage of the Market Structure Act. In summary, my view is that the consensus among US policymakers to embrace the crypto economy is strengthening and expanding, and in this context, Wall Street will also follow the trend. 4. Stablecoin payments are primarily used in B2B, not B2C scenarios. I recall that before the Stablecoin Act was passed in July of this year, there was a widespread optimistic expectation within the crypto community. Many, including myself, anticipated that once the Act was implemented, dozens or even hundreds of large US companies would issue USD-denominated stablecoins, encouraging widespread adoption and use of stablecoins by ordinary consumers. Especially for leading internet companies, issuing stablecoins to enhance their network economic impact seemed like a very reasonable expectation. However, this hasn't happened, at least not yet. While the number of stablecoins issued has steadily increased, there hasn't been a significant trend of expansion into e-commerce or offline applications. Why is this? We discussed this with senior experts in the banking and internet payment industries in New York and reached a startling conclusion: for a considerable period, the real-world application of stablecoins in payments will be concentrated in the B2B sector, primarily institutional-to-institutional payments, rather than the C2C sector. This conclusion is startling because within the crypto industry, many entrepreneurs and researchers firmly believe that stablecoins' advantages—instant global transfers, integrated payment clearing and settlement, and ultra-low fees—give them an overwhelming competitive edge over traditional banking and internet transfers. Therefore, once stablecoins are widely adopted, they will rapidly capture the market in everyday C2C payment scenarios such as retail and e-commerce. To this end, many investment institutions and entrepreneurs have invested heavily in stablecoin payment tools, hoping to seize the initiative. However, in the past few months, some stablecoin payment products that are technologically and cost-effective have encountered significant resistance in their promotion, or have simply failed to gain traction. A leading expert in global electronic and internet payments analyzed the reasons behind this. He explained that while the total global stablecoin payment volume in 2024 was $46 trillion, which seems large, $37 trillion of that was actually programmatic trading by bots on the blockchain and exchanges. Of the remaining $9 trillion, the vast majority still occurred in on-chain asset transactions and transfers, with real-world payment scenarios being negligible. Why? Because stablecoins offer no advantage over credit cards and internet payments in everyday transactions. This expert stated that proponents of stablecoin payments believe they can defeat traditional electronic payments simply by virtue of a 1% to 3% fee advantage, which is arrogance and a misconception. Traditional electronic payment systems have established a complete trust loop and ecosystem, possessing a strong network effect advantage. Their user experience is also superior to current mainstream stablecoin payment tools. Whether it's WeChat and Alipay users in China or VISA users in the US, the payment experience is already quite perfect. In a sense, VISA's transaction fees are a premium for its network effect. Stablecoins will find it difficult to break through this barrier. So where does the opportunity lie for stablecoins? This expert believes that the advantage of stablecoins doesn't lie in speed or cheapness, but in the programmability granted by smart contracts. By programming stablecoins with smart contracts, structured, conditional payments can be achieved, such as proportional payments to multiple recipients upon receipt of funds, or third-party guarantor payments similar to Alipay. Such structured payments based on contractual conditions are extremely common in inter-institutional payments, and this is where stablecoins truly shine. Therefore, he believes that the current direction of innovation and entrepreneurship in the stablecoin industry has "gone astray," neglecting its true advantages and users' real needs to challenge an opponent it has no chance of winning, which will inevitably lead to a pessimistic outcome. The stablecoin industry should immediately focus on B2B scenarios and leverage the advantages of smart contracts; this is the true superior advantage of stablecoins compared to traditional payments. This viewpoint was a revelation to me, because for the past few years we've been working with the Monetary Authority of Singapore (MAS) on trials of stablecoin cross-border trade payments, and we've found that all the scenarios are business-to-business and institution-to-institution; the originally anticipated 2C scenarios haven't materialized. This also made me realize that if the primary scenario for stablecoin payments is B2B, then enterprise-level wallets and enterprise-level account management systems become a weak link. This seems to be the focus of innovation. 5. Wall Street is confident it's seizing dominance in crypto finance, but the two orders will coexist and interact for a long time. If you're an overseas Chinese Twitter user, a short observation of the overseas Chinese crypto community will give you the impression that the center of the crypto economy is in Dubai and Singapore. But this impression may be misleading, because the center of gravity of the crypto world is shifting to New York. During our week in New York, almost all the Wall Street experts we spoke with unanimously expressed the same judgment: the crypto economy is transitioning from a retail-driven era to an institutional one. In their view, this shift is both an inevitable consequence of market development and a signal of the resurgence of American institutional power. Once the institutional era begins, the center of the global crypto economy will inevitably return to the United States, especially New York and Miami. The former is the center of capital, regulation, and compliance, while the latter, with its open tax system, innovative policies, and vibrant entrepreneurial atmosphere, has become the most active testing ground for the integration of crypto and the real economy. Their reasoning is simple: Wall Street possesses advantages in terms of capital scale, institutional advantages, and talent, while the overall size of the crypto world is still too small; the entire industry is smaller than the size of a single stock on Wall Street. Faced with a genuine influx of capital and regulatory restructuring, the decentralization of so-called "decentralized finance" is likely only relative. According to these experts, the ongoing regulatory framework in the United States—whether it's the Stablecoin Act, the Market Structure Act, or future regulations for crypto securities, custody, and trading—is not truly about regulating retail investors or stifling innovation, but rather about granting Wall Street a license for "Western expansion." Once the regulatory framework is established, institutional capital can enter the market on a large scale under legal protection, gaining control over pricing, discourse, and liquidity. From that moment on, the rules, benchmarks, and even the ecosystem of the crypto market will be reshaped, and this reshaping will unfold with Wall Street at its core. However, this does not mean that the offshore crypto ecosystem in Asia will disappear. On the contrary, Dubai and Singapore will remain important hubs for global crypto innovation. They offer the flexibility, cultural inclusivity, and entrepreneurial spirit brought about by regulatory gray areas—elements that the US system cannot fully replace. Therefore, the future global crypto landscape will present a state of "dual-system coexistence." New York represents the mainstream onshore crypto economy ecosystem, characterized by institutionalization, financialization, and dollarization, while the Asian offshore ecosystem represents an alternative system of openness, experimentation, and transnational collaboration. The two will interact in the long term, but with a clear distinction between primary and secondary roles.
Catherine
Kikyo
Weatherly
Alex
Joy
Anais