Are non-KYC exchanges riskier? Understanding legal implications

The stalling of key stablecoin legislation in the United States Senate was a minor setback, and the bill will pass in the coming weeks, said Cody Carbone, CEO of Digital Chamber, a Washington, DC,-based blockchain trade association and advocacy group.Speaking to Cointelegraph at Consensus 2025, Carbone argued it is in the best interests of the US to pass comprehensive stablecoin regulations to protect US dollar hegemony in global markets, which has bipartisan appeal and support. Carbone said:”These things never move as quickly as we want them to move, but it’s stablecoin legislation. This Congress has already moved more expeditiously than we ever could have imagined. So, yes, it’s a bump in the road, but I think very, very shortly, we will have another vote.”The Guiding and Establishing National Innovation in U.S. Stablecoins of 2025, or GENIUS Act, is seen as a critical piece of legislation. Failing to pass comprehensive regulatory reform before the midterm elections in 2026 could mean a reversal in the positive regulatory environment and a downturn in the crypto markets.”Negotiations have continued, and so I am still very optimistic,” Carbone said. “This bill is going to pass the Senate in the next few weeks.”The GENIUS Act of 2025. Source: US SenateRelated: What are the next steps for the US stablecoin bill?Partisan politics and Trump’s involvement in crypto blamed for bill failureThe act failed to pass a procedural vote in the Senate on May 8 after several Democratic lawmakers withdrew support for the bill, citing US President Donald Trump’s involvement in crypto as a potential cause for ethics concerns and the primary driver for backpedaling support for the bill at the last minute.Coinbase chief legal officer Paul Grewal likewise said that Trump’s crypto ties complicate the regulatory process, as lawmakers continue to scrutinize his activities in the memecoin market, decentralized finance, and the non-fungible token (NFT) sector.Republican Senator Tim Scott fired back against the concerns voiced by Democratic policymakers, attributing the failure to partisan politics and an attempt by Democrats to prevent Trump from achieving the administration’s digital asset goals.The latest version of the bill removes references to the Trump family and could pass the Senate by the end of May, some industry executives say.Magazine: Crypto wanted to overthrow banks, now it’s becoming them in stablecoin fight

Opinion by: Megan Knab, CEO, Franklin PayrollThere are few historical examples of such a massive about-face for an industry, from banks debanking crypto businesses to now embracing stablecoins. If you talk to most crypto startup founders or companies with crypto on the balance sheet, they will all have war stories about finding, applying for and maintaining bank accounts. Over the past three years, over half of debanking complaints have been lodged against four American banks — Bank of America, JPMorgan, Wells Fargo and Citibank. Now, as the policies that discriminated against the crypto industry, like “Operation Chokepoint 2.0” and the recision of controversial accounting rule SAB 121, have been repealed, a new openness to blockchain technology from the finance sector is possible. It is imperative that the banking industry stop shunning crypto and start — at least understanding it — to stay competitive. How stablecoins are deployed will separate the banking winners and losers. From debanking to stablecoins Of course, stablecoins are not a new concept. For years, large institutions like JPMorgan and Santander have experimented with stablecoins and blockchains. Those experiments were around small functions like internal treasury reconciliation and interbank settlement. Much of this was also on private blockchains created by those banks. Implementing digital dollars on private chains, however, misses out on the core innovation of stablecoins.While the use case of stablecoins for international remittances is clear, we are just scratching the surface of the power of stablecoins on public networks. For example, stablecoins eradicate unauthorized payment disputes and enable far faster pay cycles. Payroll payments are also complex. Payday is a web of thousands of automated clearing houses, wires, comma-separated values and PDFs. The programmability of stablecoins enables companies to create efficiency among all these data structures, processing times, reconciliations and paycheck reporting. Many smaller banks are just now waking up to the opportunity to incorporate permissionless, public network stablecoins into their workflows. Similar to how many businesses started to investigate how AI might change their businesses with the 2022 release of ChatGPT, so too are banks needing to look at how stablecoins will upend money movement. Recently, Custodia Bank issued its own stablecoin, Avit, on Ethereum. Custodia’s users can access quick, cheap banking services that are hard to beat. This is an excellent example of implementation for other financial institutions to follow.Stablecoin adoption is increasing as the tech keeps improvingActive stablecoin wallets increased from 19.6 million in February 2024 to over 30 million in February 2025, according to Artemis and Dune. US President Donald Trump hopes to have stablecoin legislation on his desk by August 2025. Wyoming already did so in late March 2025.Recent: Mastercard links with Circle, Paxos for merchant stablecoin paymentsStablecoin infrastructure has improved significantly, and there is increased confidence in the security of stablecoins. 91% of the supply of stablecoins is fiat-backed, and only 8.5% are backed by collateralized crypto assets. Riskier algorithmic stablecoins have gone out of vogue.Incremental changes also make it easier for non-crypto businesses to use stablecoins. There are now simple solutions for many of the original UX problems with stablecoins.Additionally, more assets are moving onchain. Using stablecoins on public networks like Ethereum, payment companies will be better prepared to serve the future financial system. It’s not just stablecoins that are updating the financial system, either. Earlier this year, BlackRock CEO Larry Fink said on Squawk Box he wants the SEC to “rapidly approve the tokenization of bonds and stocks.”For banks looking for a competitive advantage in a world of powerful fintechs, shifting interest rates and lower consumer savings, using the power of stablecoins to improve their products and their internal operations might be the most powerful decision they make. Opinion by: Megan Knab, CEO, Franklin Payroll.This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Ripple’s legal chief said a US court’s rejection of a proposed XRP settlement with the Securities and Exchange Commission (SEC) does not pose a threat to Ripple’s win.Judge Analisa Torres of the US District Court for the Southern District of New York rejected a joint Ripple-SEC motion seeking an indicative ruling on their proposed settlement, according to a filing on May 15.Ripple’s chief legal officer, Stuart Alderoty, said the rejection does not reverse the company’s victory in the case. The company announced the end of the lawsuit on March 19.Source: Stuart AlderotyAlderoty stressed that the latest court decision does not change the fact that XRP (XRP) is not a security, adding that the rejection is related to “procedural concerns with the dismissal of Ripple’s cross-appeal.”Why did the court refuse to grant the ruling?According to the court document, Torres denied the motion as “procedurally improper” since the SEC and Ripple failed to file the correct procedural motion to support the proposed settlement.“By styling their motion as one for ‘settlement approval,’ the parties fail to address the heavy burden they must overcome to vacate the injunction and substantially reduce the civil penalty,” the Judge wrote.An excerpt from the court’s rejection of the SEC-Ripple motion on May 15, 2025. Source: CourtlistenerThe SEC and Ripple agreed to lower the court’s $125 million fine days before Ripple CEO Brad Garlinghouse announced the end of the case. Subsequently, Alderoty disclosed on X that the SEC will keep $50 million of the $125 million fine.“The parties have made no effort to satisfy that burden here; their request does not even mention the Rule,” the court document stated.Community asks for explanationAs Alderoty has not provided any details on the nature of procedural concerns by the court, but assured the public that Ripple and the SEC are “fully in agreement to resolve the case,” many in the community were unhappy with the lack of specifics from Ripple.“First, in a recent post about this case, you said you would not be making any more X posts because the case was closed,” one XRP observer responded to Alderoty in the X thread.Source: X thread from Stuart Alderoty“Second, I don’t think it’s enough to just say that it’s procedural. I think further explanation of what went wrong in the filing is needed,” one XRP observer wrote in an X thread,” the post continued.Related: Ripple commits $25M to US school nonprofits“Let’s remember that both he and Brad said the case was over, and it still isn’t; they’re cheating us a little,” another user speculated.The news came shortly after online reports suggested that US President Donald Trump was allegedly manipulated by a Ripple-linked lobbyist into announcing the XRP token would be part of his plans for a national cryptocurrency reserve.Many in the Bitcoin (BTC) community have been slamming Ripple for advocating for a multi-coin strategic reserve, instead of a Bitcoin-only reserve.Magazine: Danger signs for Bitcoin as retail abandons it to institutions: Sky Wee