The Briefing Memo

September 2026 - If you’re new here, welcome to The Briefing Memo, which features the latest insights and updates from The Venture Dept., the friendly former regulators on the cap table. If this newsletter has been forwarded to you, you can subscribe here. 

Portfolio Updates

For the third time in 2026, one of our portfolio companies got an exclusive in Fortune. Following Rhythmic (February) and Valinor (March), Tare has graced the magazine’s pages. 

TVD got a nod as one of the investors, along with Strobe, Blockchain Capital, and others. We promise there’s no payola going to Fortune’s editors; they just seem to recognize greatness when they see it. If you want to know about why we invested in Tare, check this out, and check out Kevin’s own thoughts here.

Two of our portcos met and fell in love. Or at least in business. Valinor launched the BDC Exposure Fund (VBDC), a tokenized fund that holds a basket of publicly traded business development companies and offers accredited/qualified purchasers daily subscriptions and redemptions rather than the quarterly-or-longer lockups typical of private credit. The fund trades on Superstate's blockchain infrastructure and offers daily subscriptions and redemptions, with Superstate providing the tokenization layer through its FundOS platform, handling both the blockchain rails and the transfer agent function to keep the structure compliant with securities rules. Get the skinny about the product here. 

The FBI invited Predicate founder Nikhil Raghuveera to speak at its ninth annual Virtual Asset Technical Exchange. He hasn’t said whether he partied with Director Patel on his private jet after. Probably less excitingly, he spoke at Stablecon on whether stablecoins can be both private and compliant. 

Uniform Labs' Multiliquid is partnering with Particula, a tokenized-asset risk rating provider who’s already rated a fund for Wellington Management, which has $1.3 trillion AUM, to build standardized risk assessments (a rating, a structured data profile and flagged risks) into how it vets and onboards assets for instant conversion, settlement and collateral use. Issuers disclose information once for both processes, and Multiliquid participants get a consistent basis for comparing assets while still applying their own risk parameters. Good upgrade. 

Fission is now offering instant USDC redemptions for two of Midas's tokenized funds, mWIN gives onchain exposure to institutional credit managed by Wellington (there’s that name again) and mGLOBAL gives exposure to alternative debt managed by Fasanara Capital.

If you’ll be at SF Tech Week, go see Stable Sea CEO and cofounder (I’m over the hyphen) Tanner Taddeo get on stage with friend of the fund WisdomTree in a panel discussion, “Building the Onchain Capital Stack.” Hear him here talking about, regardless of Clarity’s demise (see more below on that thing), growth in tokenized technology is “up and to the right.” Correct. And if you’re in Seoul for XRPL Korea, go see Squid cofounder Fig. Squid is XRPL’s official bridge partner. 

This Week in Fintech posted a (deservedly) flattering piece on Flyra founder and CEO Oneal Bhambani. He helps folks to see what we did when we invested: a deep background in finance and payments, with time in TradFi and at early-stage credit and infrastructure players, and a programmer, to boot. The post also highlights FlyraOS, a programmable financial operating system built on a real-time stablecoin ledger with AI agents, that lets platforms launch global money products like remittances, wallets, cards and rewards in as little as 60 days without stitching together separate vendors. Oneal says, "I always wanted one live system of truth for the balance sheet. AI can now assemble it continuously, and blockchain can make the assets on it programmable. So I built it." Love this guy.

Circuit founder Harry Donnelly brought his smooth brogue to a FintechTV interview, where he described Circuit as an on-chain risk platform that focuses on real-time response to crypto theft, using pre-signed transactions to automatically sweep funds to safety the moment an attack is detected, rather than relying on prevention or post-hack recovery. He discussed why this matters given rising AI-driven attacks and the 2024 Bybit hack, how Circuit secured backing from Lloyd's of London as their first-ever crypto investment, and his vision for security safeguards in an emerging agentic, on-chain economy. Slainte!

Dept. Updates

Matt went to DC for this year’s US stablecon, where he sat on a panel on the path forward post GENIUS Act.

Look how happy he is. He’s up there with Ji Kim, President of the Crypto Council for Innovation and friend of the fund. Speaking of FOTFs, Justin Friedman got to sit down with Patrick Witt, discussing how Clarity will definitely pass (this was early September, when some people had hope).

Justin asked him about non-USD stablecoins, and Witt argued there's room for them just as there is for multiple national currencies, but predicted that GENIUS will become the global benchmark, with other jurisdictions adopting it, seeking reciprocity with the US, or reworking frameworks like Europe's more restrictive regime to mirror it.

On digital identity for the agentic economy, he said policy has a role in helping "Know Your Agent" standards take shape, since AI agents already outnumber humans online, and stressed that any solution must prove only as much identity as necessary to protect privacy, likely emerging iteratively into a common standard.

Jon and Matt also hosted a Digital Asset Leadership Dinner, cohosted with Mirana Ventures.

We ate Korean BBQ, seafood pancakes, and kimchi til we burst. Great to have several of our LPs, founders, and friends together to discuss the latest news and insights from across the industry. We hope to see you at another TVD dinner soon.

The boys also made their way to the Avalanche Summit New York. It was pretty corporate this year, as you might expect. Fortunately, that meant TVD portco founders, including Kevin Miao from Tare and Lily Yarborough from Valinor, got to get up on stage and show TradFi how it’s done. We also got to spend some time with etherfuse, which continues its winning ways.

Matt also found himself surrounded by a blue-suited current and former DFS crew while speaking at the Digital Assets, Stablecoins, and Tokenized Finance roundtable.

And if anyone is in town in October, The Bridge Presented by The Tie is back in Battery Park City (i.e., the absolute closest event Jon can go to without its being in his own apartment). It’s always a good event, and especially so with this year, as Matt will be charming attendees from the stage.

Hope to see you there.

Regulatory Developments

Yeah, Clarity. Cloture didn’t happen and now there’s no time left on the clock until after the midterms, given Speaker Johnson sent everyone home September 17 and congress wont reconvene until November 9; Sen. Kennedy believes they’ll try again post election, but it’s unclear why things will be terribly different then. We would imagine the Democrats, if the blue wave ends up happening (currently 61% odds on Polymarket that they’ll sweep both chambers) will not prioritize that legislation, though Sens. Gillibrand, Booker, and five other Dems announced they “committed to a bipartisan path” to get it done. (FWIW, they all voted against cloture). The main sticking point seems to be ethics provisions, which the White House ain’t giving on; I guess when you make $1.4bn in crypto in a year, you want to hang onto that.

Who’s to blame for not passing? CoinDesk's Nikhilesh De, drawing on interviews with more than a dozen industry participants and Hill aides, argues the Clarity Act was sunk by a pile-up of problems rather than any single one: the Senate ignored the House's bipartisan bill and wrote its own piecemeal, Democrats never got an ethics deal restricting Trump's crypto profits that satisfied them (made worse by his $1.4 billion disclosure), and the vote came just weeks before a midterm in which neither party wanted to hand the other a win. Sources also fault Coinbase's January withdrawal of support, which set off a months-long fight with banks over stablecoin yield and burned valuable time, and a Republican-led drafting process that sidelined Democratic staff, including a last-minute Tillis-led compromise reportedly cut off by a staffer for Chairman Tim Scott. The Journal largely agrees. 

So that leaves rulemaking to get us (lower case) clarity on some of these issues. While rules don’t have the same permanence as laws (i.e., an agency can issue new rules through the same path), our belief is that with a substantive set of rules, institutions can start putting shovels in the ground. It seems that if TradFi ends up pretty all-in on digital assets, then by the time Elizabeth Warren is the SEC chair, it will be very difficult to undo what the agencies have done. The SEC and CFTC have announced they’re moving full steam on delivering what they can in the absence of legislation. It’s what we’re working with. We believe there is an emerging, cohesive network of regulations that will provide a pathway to permanent open lanes leading to the growth we’re looking for.

And the SEC is delivering, first with the modernization of transfer agency rules, its first major overhaul of transfer agent rules since the late 1970s/early 1980s, explicitly accounting for blockchain-based recordkeeping, tokenized securities, and third-party service providers. The proposal would amend rules to modernize recordkeeping/retention terminology for electronic and distributed-ledger systems, while rewritten rules would add risk-management, business-continuity, and written compliance-policy requirements. It also would require transfer agents to report their use of DLT, tokenization providers, and DLT platforms, plus separately track issuer-initiated versus third-party tokenized issues. 

The SEC's new innovation exemption creates time-limited relief allowing a new category of entity called "tokenized securities venues" (TSVs) that run automated market maker liquidity pools to be exempt from the definitions of "exchange" and "dealer" under the Exchange Act, enabling tokenized NMS stocks to trade onchain. Commissioner Hester Peirce framed the order as an alternative to the mythological Procrustes, who forced every traveler to fit one bed by stretching or cutting them, saying the Commission instead tailored the exemption's conditions to fit the sleeper without disturbing anyone else's sleep. She described it as an interim, observational step rather than a permanent rule, meant to let regulators watch how tokenized stocks trade onchain before crafting durable rules, and stressed it doesn't extend to true decentralized finance, as permissionless smart contracts don't raise the intermediary-trust concerns securities regulation targets. 

The Commission also dropped new FAQs following its March interpretive guidance release. Biggest takeaways: Once a network is functional, the token team can keep building without its token being treated as a security. Staff say that after a crypto system is functional, services to secure, maintain, improve or enhance it, including funding development and growing network effects, are not "essential managerial efforts." Also, teams get more room in marketing, and liquid staking tokens get clearer treatment. Promoting a network's current utility, or making vague, aspirational statements about future features, likely doesn't count as a promise of managerial effort, as long as nothing in it promotes profit potential. Separately, staking receipt tokens for non-security assets are classified as "digital tools" or as "digital commodities" when issued by a protocol-based liquid staking provider. A token only counts as a receipt if the issuer can't lend, pledge, or rehypothecate the underlying asset. We love this sort of transparency from a regulator. 

Crypto Mom Hester Peirce is almost ready to leave the SEC, but isn’t done talking about what’s important to her. She gave a speech at SIFMA’s conference about how KYC is just the worst, but zero-knowledge proofs can evolve how things are done. Such a path would allow customer data to be verified without the invasiveness today’s systems require. Fine by me.

The CFTC got right on it, saying they’ve got existing authority to make new rules, sending proposed rulemaking to the White House two days after Clarity bit the dust. It also granted through a no-action letter relief to software developers who connect users to registered derivatives changes. The developers will not have to register as brokers. The Commission also issued new crypto/blockchain FAQs, including digital assets’ use as collateral (you’re allowed) and margin (you’re not). Nonstop action from the big regulators sends our hearts aflutter.  

Well at least Congress is moving the ball forward with something about crypto. The House Ways and Means Committee voted 38-5 (when’s the last time there was such bipartisan support for anything?) to advance a bill on crypto wash sale rules and counts staking and mining rewards as ordinary income. I guess we’ll take it.

Across the pond, the ECB and the various central banks asked the European Commission to extend the yield ban on stablecoins to crypto lending, borrowing, and staking and to have those activities regulated at the EU level. We’re looking at mid-2027 for some new rulemaking around it. Europe also launched Pontes, enabling wholesale tokenized asset transactions to be settled in central bank money.

The G20, which met in North Carolina (why?), endorsed digital assets as a growth tool (and why did it take this long?). They’re deferring to FASB’s work on how they would affect cross-border activity. FASB has already been working, seeking public comment on clarifying how cash equivalent definitions apply to stablecoins, which is unreconciled, giving some uncertainty about accounting under GAAP. They’ve revealed that among other things, there would be enhanced disclosures about cash holdings, including stablecoins.

Another month, another OCC application. Block announced it’s seeking a banking charter. Builders Bank would be a national trust bank under federal supervision, offering (uninsured) custody and other fiduciary services, including for bitcoin and stablecoins. As Block grows, the charter would let it run these activities under a single nationwide regulatory framework.  

The Fed has taken some blame for Silicon Valley Bank’s failure in March 2023 with a report by Vice Chair Michelle Bowman. Sen. Warren isn’t buying it, saying the report “magically exonerates her and President Trump of any wrongdoing” and is “an embarrassing attempt to re-write history designed to pave the way for more dangerous deregulation that will lead to the next Silicon Valley Bank disaster.” Not entirely sure how Trump and Bowman, who weren’t in office at the time, were to blame, but Warren knows. She knows.

News

The State and Treasury Departments, along with the Development Finance Corporation, are looking for a public/private partnership to push USD stablecoins. It’s a way to boost Treasury sales and counter a digital euro and China’s mBridge product. Call us, DFC! We get it!

Morgan Stanley thinks we hit $2.3 trillion in tokenized RWAs by 2030 (if AI hasn’t killed us yet, I guess), with the bear case at $1.7T and bull case $5.5T. Market cap is currently in the low billions, so this would be pretty bullish regardless from where we are now. But we have some support for that. First, the NYSE is working with Blockchain.com to bring tokenized stocks to Blockchain’s 44 million customers worldwide. Also, Kraken parent Payward is working on tokenizing the LSE’s 100 top stocks, which could be self-custodied or on an exchange and trade 24/7. Tokenized RWA volumes have exploded recently, up 415% in August. Always-on stock trading is here, in size. On just Saturday and Sunday over Labor Day weekend, $1.01bn in tokenized stocks traded hands, equaling the volume traded on that Friday.

(Looks like some traders at least on Monday were a little preoccupied with BBQs.)

Citi, Goldman, WisdomTree, BofA, and other financial institutions are working on issuing a dollar stablecoin, with an eye to broadening to the other major currencies. 

Look at all that TradFi.

Citi tapped Coinbase to let its big corporate clients accept stablecoin payments at checkout, with Coinbase handling the blockchain rails and automatic conversion to dollars while Citi settles the funds as bank of record. The deal, along with Citi expanding its own token services to Japan and the UAE, shows banks are pushing ahead on crypto under existing rules despite the Clarity Act's collapse in the Senate.

While stablecoin market capitalization has been pretty flat (and there are theories why), Visa is out here killing it, announcing a $20bn stablecoin settlement annualized run rate, 15x YoY. The company cites programmatic control (auto-settling settlement receivables) and settlement-data- verified underwriting (better data means better pricing) as the two main drivers. Visa claims zero defaults on $2bn in settlements since launching in 2023.

Capgemini is out here telling banks they better get a move-on with stablecoins or risk losing business to non-bank providers. Big takeaway: “71% of corporates would choose a bank over a fintech for tokenized payments at equivalent cost and quality.… Nearly 60% of corporate clients are willing to source stablecoin services from non-bank providers if their banking partners fail to keep pace. This competitive erosion arrives as corporate clients report 36% of their B2B payment volume already flows through non-banks.” Sounds like it’s time, banks. Coinbase is bringing 1,000 community banks stablecoin access, so hopefully they will have an avenue of approach on what’s coming.

But it’s not crypto that’s killing small banks right now, it seems; it’s big banks. 

Chase and BofA alone have more deposits than all community banks (4,300 of them) combined.

Circle also launched Arc’s public mainnet, a Layer-1 blockchain purpose-built for financial markets, real-time money movement, and agentic economic activity. They promise sub-second deterministic finality and launched with BlackRock, DTCC, Visa, Mastercard, and ICE. Circle’s pushing here beyond just issuing USDC and into owning more of the settlement infra itself. 

Hunter Biden went and launched himself a meme token, $LAPTOP. How about that. Twenty percent of the tokens were set aside for airdrops, including to those holding TRUMP tokens at a loss. Ahem. At launch $SLAPTOP went immediately to the moon and then crashed down through the launching pad. Went from $37 to about $200 before falling by 99% and now has about the same valuation as TRUMP. Stay away from the memecoins, everyone - they bite. 

Listens and Reads

Here’s Blackrock, arguing that AI (which it calls "machine-native intelligence") and digital assets ("machine-native money") are converging, because both rely on tokenization to turn real-world inputs into standardized units machines can process, and it frames AI adoption as an underappreciated source of demand for crypto infrastructure. Agentic AI will need always-on payment rails capable of sub-cent, machine-to-machine transactions, which traditional systems like ACH and card networks handle poorly, positioning stablecoins and protocols like x402 and ACP as the likely settlement layer. They also predict that compute capacity, with hyperscaler cloud revenue projected to reach about $1.1 trillion by 2030, could become a major new tokenized asset class with standardized contracts, futures, and agents that buy capacity on their own. Strong agree. 

Want to know everything there is to know about vaults? Check out this piece by GBBC that dives deep into the stack and will certainly make you smarter on where we’ve recently invested (through Nashpoint). DeFi vaults are smart contracts that pool user deposits and automatically execute yield-generating strategies, and the report distinguishes fully automated vaults from "curated" vaults where a designated curator exercises varying degrees of discretion over strategy, protocols, and risk parameters. This curation spectrum is the key analytical lens for the report, as it determines how a vault should be treated from a regulatory, risk, and accountability standpoint, drawing a sharp line between the software developer who builds the vault (an infrastructure function) and the curator who actively manages capital allocation (potentially a financial intermediation function). The report closes with recommendations covering mandate clarity, risk-adjusted disclosure, curator governance, cybersecurity, AI-agent oversight, and activity-based regulatory analysis, arguing that vaults should be assessed by what is actually being done and by whom rather than by labels like "decentralized" or "automated." Enjoy.

Disclaimer

The information in this newsletter is provided solely for general informational purposes and reflects the author’s personal views at the time of publication. Nothing herein should be construed as investment advice, legal advice, or a recommendation to engage in any transaction or strategy. Readers should consult their own professional advisors before making any financial, legal, or other decisions. All information is provided “as is,” without any representation or warranty of any kind.